City Council Meeting

CITY OF LAREDOCITY COUNCIL MEETING

A-2016-R-02CITY COUNCIL CHAMBERS

1110 HOUSTON STREETLAREDO, TEXAS 78040

FEBRUARY 1, 20165:30 P.M.

DISABILITY ACCESS STATEMENT Persons with disabilities who plan to attend this meeting and who may need auxiliary aidor services are requested to contact Doanh "Zone" T. Nguyen, Acting City Secretary, at(956) 791-7308 at least two working days prior to the meeting so that appropriatearrangements can be made. The accessible entrance and accessible parking spaces arelocated at City Hall, 1100 Victoria Ave.

Out of consideration for all attendees of the City Council meetings, please turn off allcellular phones and pagers, or place on inaudible signal. Thank you for yourconsideration.

Pursuant to the Texas Penal Code (trespass by holder of license to carry a handgun), aperson licensed under Subchapter H, Chapter 411, Government Code (ConcealedHandgun Law or Handgun Licensing Law), may not enter into the City Council Chamberwhile City Council is in session with a concealed or openly-carried handgun.

I. CALL TO ORDER II. PLEDGE OF ALLEGIANCE III. ROLL CALL IV. MINUTES

Approval of the minutes of January 19, 2016 and January 26, 2016. V. COMMUNICATIONS AND RECOGNITIONS

Communiqués

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Communiqués

Presentation by City Staff on the Cell Phone Ban Ordinance MediaCampaign.

1.

Recognitions

Citizen commentsCitizens are required to fill out a witness card and submit it to the City Secretary no laterthan 5:45 p.m. and identify themselves at the microphone. Comments are limited to three(3) minutes per speaker. No more than three (3) persons will be allowed to speak on anyside of an issue. Should there be more than three (3) people who wish to speak on aparticular issue, they need to select not more than three (3) representatives to speak forthem and the presiding officer may limit the public comments further in the interest of anorderly meeting. Speakers may not pass their minutes to any other speaker. Commentsshould be relevant to City business and delivered in a professional manner. Noderogatory remarks will be permitted.

VI. APPOINTMENTS TO COMMISSIONS, BOARDS AND COMMITTEES

Appointment by Council Member Alejandro "Alex" Perez of ____ to the Planning& Zoning Commission.

a.

Appointment by Council Member Alejandro "Alex" Perez of ____ to theHistorical/Landmark Board.

b.

Appointment by Council Member Roque Vela Jr. of Richard Norton to thePlanning and Zoning Commission.

c.

VII. PUBLIC HEARINGS

1. Authorizing the City Manager to accept and enter into contract with theTexas Department of State Health Services (DSHS), amending the FY2015-2016 Budget by appropriating additional revenues and expenditures inthe amount of $200,000.00, and amending the FY 2015-2016 Full TimeEquivalent (FTE) Listing by adding one (1) Health Educator Supervisor, R38position and one (1) Caseworker, R34 position to implement the TexasHealthy Adolescent Initiative (THAI) clinic-based program for the periodbeginning December 21, 2015 through August 31, 2016. This program willassist youth to get preventive health care, behavioral health services andcounseling that maybe needed to address social-psycho issues. (Approvedby Operations and Finance Committees)

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2. Authorizing the City Manager to accept a voucher payment reimbursement

of additional funds in the amount of $350,000.00 (for remodeling and roofrepairs of the Santo Nino Community Center) from the Texas Department ofState Health Services (TDSHS) and amending the FY 2015-2016 HealthDepartment Budget by appropriating additional revenues and expendituresfor a total of $5,964,826.00 for the Women, Infants and Children (WIC)Program of the City of Laredo Health Department (CLHD) for the period ofOctober 1, 2015 through September 30, 2016.

3. Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning Lot

2, Block 624, Western Division, located at 2416 Ventura Street, from R-2(Multi-Family Residential District) to R-3 (Mixed Residential District);providing for publication and effective date.

Staff does not support the application and the Planning and ZoningCommission recommends approval of the zone change. District VIII

(Recess)(Press Availability)

VIII. INTRODUCTORY ORDINANCES

4. Authorizing the City Manager to execute a lease agreement withWashington’s Birthday Celebration Association, Inc. (W.B.C.A.) forapproximately 3.9 acres and more formally known as the “Park and Ride”,and the approximate 7.35 acres consisting of all Lot No’s. 1 and 2 of theLaredo International Airport Manufacturing Facilities Subdivision Plat, andthe portion area north of the Animal Care Shelter on Maher/Hillside/ThomasStreet for the W.B.C.A. Jalapeno Festival and other W.B.C.A. sponsoredevents. The lease term is for five (5) consecutive years for the month ofFebruary commencing on February 2016 and ending on February 2020 andproviding for termination. Initial annual rental rate of $1,000.00; providing foran effective date. (Approved by Operations and Finance Committees)

5. Closing and vacating as a public easement that section of Center Road, as

dedicated by the R. M.R. Industrial Park Plat Unit 2, Volume 3, page 23, ofthe Webb County Plat Records and providing for the reversion of all publicinterest in said dedicated road to the current abutting landowners in equalshares provided that the City retain the east one half section of the road asa utility easement. The road section is further depicted on attached exhibit Aand providing for an effective date. (Approved by Operations Committee)

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6. Public hearing and introductory ordinance amending the City of Laredo's FY

2015-2016 Laredo Convention and Visitors Bureau Fund budget byincreasing revenues and expenditures in the amount of $195,000.00 forfunding a documentary film in conjunction with TAMIU and KLRN. Thefunding will be transferred from the City of Laredo FY 2015-2016 Hotel MotelFund budget. (Approved by Operations and Finance Committees asamended)

IX. FIRST AND FINAL READINGS

7. 2016-O-020 An ordinance by the City Council of the City of Laredo, Texasauthorizing the issuance, sale and delivery of City of Laredo, Texas GeneralObligation Refunding Bonds, Series 2016; approving and authorizing apurchase contract, an escrow agreement, and a paying agent/registraragreement; approving and authorizing all other instruments and proceduresrelated thereto; delegating authority to the Mayor and/or the City Manager toselect outstanding bonds to be refunded and approve all final terms of thebonds; and authorizing amendment to the city's budget to appropriate suchproceeds for purposes authorized herein; and ordaining other mattersrelating to the subject.

8. 2016-O-021 Ordinance authorizing the issuance of City of Laredo, Texas

Waterworks and Sewer System Revenue Refunding Bonds, New Series2016, for the purpose of refunding Waterworks and Sewer System RevenueBonds, approving an official statement, authorizing the execution of apurchase contract and the execution of an escrow agreement, and makingprovisions for the security thereof, delegating authority to the Mayor and/orthe City Manager to select outstanding bonds to be refunded and approveall final terms of the bonds, and authorizing amendment to the city's budgetto appropriate such proceeds for purposes authorized herein; and ordainingother matters relating to the subject.

X. FINAL READING OF ORDINANCES

2016-O-010 Amending the City of Laredo FY 2016 Airport Operating andAirport Construction Budget to appropriate revenues in the amount of $2.4million for Airport Runway Protection Zone, appropriating said revenue tothe appropriate expenditure accounts and authorizing the City Manager toimplement said budget amendment. As amended to increase amount from$2.0 million to $2.4 million.

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2016-O-011 Amending the Zoning Ordinance (Map) of the City of Laredo byrezoning Lots 1 and 2, and parts of Lots 7 and 8, Block 1774, EasternDivision, located at 819 S New York Avenue, 2901 Blaine Street, from B-1(Limited Commercial District) to B-3 (Community Business District);providing for publication and effective date. District II

2016-O-012 Amending the Zoning Ordinance (Map) of the City of Laredo byauthorizing a Special Use Permit for a Restaurant Serving Alcohol, on Lot 2,Block 1, Walmart at San Isidro Ranch Subdivision, located at 10719International Boulevard; providing for publication and effective date. DistrictVI

2016-O-013 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning four (4) acres out of Tracts 8-A, 8-B, 8-C and 8-D, Casa Verde Acres Subdivision, as further described by metes and bounds in attached Exhibit "A", located at 8404 Casa Verde Road, from R-1 (Single-family residential District) to R-2 (Multi-Family Residential District); providing for publication and effective date. DistrictV

2016-O-014 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning Lot 3, Block 1, Webb County Road and Bridge Plat Subdivision, located at 7210 U.S. Highway 59, from AG (Agricultural District) to B-1 (Limited Commercial District); providing for publication and effective date. District V

2016-O-015 Amending the Zoning Ordinance (Map) of the City of Laredo byauthorizing a Conditional Use Permit for an impound lot on Lots 3 and 4,Block 807, Eastern Division, located at 306 and 316 South Meadow Avenue;providing for publication and effective date. District Ill

2016-O-016 Amending the Zoning Ordinance (Map) of the City of Laredo byrezoning Lot 2B, Block 3, McPherson Acres, Unit 1, located at 5812McPherson Road, from B-3 (Community Business District) to B-4 (HighwayCommercial District); providing for publication and effective date. District V

2016-O-017 Amending the Zoning Ordinance (Map) of the City of Laredoby rezoning Lot 10, Block 86, Western Division, located at 320 lturbide Street from B-1 (Limited Commercial District) to B-3 (Community Business District); providing for publication and effective date. District VIII

2016-O-018 Authorizing the City Manager to execute a lease assignment

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2016-O-018 Authorizing the City Manager to execute a lease assignmentfrom Adriana Martinez, as LESSEE, to Mel-Mac Deck Investments, LLC., asASSIGNEE, of that original lease agreement approved by Ordinance No.95-O-177 dated August 7, 1995 and as amended by Ordinance No.2015-O-020 for approximately 16,291.44 square feet of land located at 1719E. Hillside St., located at the Laredo International Airport. The monthly rentaleffective September 1, 2015 is increased from $1,410.46 to $1,660.46 andshall be adjusted by changes in CPI. All other terms and conditions remainthe same and in effect; providing for an effective date.

2016-O-019 Authorizing the ratification of the contract amendment with theTexas Health and Human Services Commission (HHSC) and amending theFY 2015-2016 budget by appropriating additional revenues andexpenditures in the amount of $106,158.60 with a cash match of $10,616.00for a total of $573.274.60 for continuation of the Nurse Family Partnership(NFP) for the City of Laredo Health Department (CLHD) to provideevidence-based nurse home visitation for first-time mothers anddevelopment and preventive care to their children to ensure a healthy birthoutcome for mom and baby for the period beginning September 1, 2015through August 31, 2016.

XI. MOTIONS

9. Confirming the recommendation by Judge Cuellar to appoint ElizabethMartinez as Associate Municipal Court Judge.

10. Consideration to reject all bids for contract FY16-018 for the purchase and

installation of Solar Lighting for Pathway for Bartlett Soccer Complex. Thesebids received were evaluated and rejected by staff as most were found to beincomplete and others far exceeded the estimated costs. Funding isavailable in the 2008 C.O.

11. Consideration to award purchase contract to Hunter Knepshield, Plano,

Texas in the amount not to exceed $67,122.00. This contract is throughBuyBoard Cooperative Purchase Contract and is for the purchase of LEDLight Fixtures and Poles to be installed at Bartlett Soccer Complex. Fundingis available in the 2008 C.O.

XII. CONSENT AGENDA

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XII. CONSENT AGENDA

Resolutions and Motions previously brought before Operations and FinanceCommittees may be approved by City Council categorically EN BLOC. AtCouncil's request, specific items may be withheld from the consent agendafor individual treatment.

XII (a) RESOLUTIONS

12. 2016-R-09 Consideration to grant fee waivers and a Tax AbatementAgreement between the City of Laredo and B & G’s, LLC for the residentialproperty located at 801 Fremont St., being Lot 1 Block 268 Eastern Division.The proposed residential property eligible for property tax abatementincludes the new construction of a 1,279 sq. ft. structure in the total amountof $54,783.63 which is equal to or in excess of 20% of the Base Value of theproperty in accordance with authorized guidelines and criteria establishedfor the Neighborhood Empowerment Zone (NEZ). This agreement will be fora five (5) year period and will consist of an estimated annual tax abatementtotal of $281.95 and estimated total fee waiver of $681.00 based on capitalinvestment for the purpose of economic development. Guidelines andcriteria for the agreement are set forth in the attached agreement andinformation.

13. 2016-R-10 Authorizing the City Manager to execute this Memorandum of

Agreement (MOA)into by and between the Coastal Bend Regional AdvisoryCouncil (CBRAC) and the City of Laredo Fire Department to participate as amember of Texas Emergency Medical Task Force (hereinafter EMTF). ThisMOA is to establish a mechanism for the utilization and coordination ofemergency medical resources and assets in the event of an emergency ordisaster.

14. 2016-R-12 Authorizing the City Manager to enter into and execute 77

cooperative working agreements/mutual assistanceagreements/memorandums of understanding between the City of LaredoPolice Department and various federal, state and local agencies, includingbut not limited to: Drug Enforcement Administration (DEA), Federal Bureauof Investigations (FBI), SCAN, et al., a comprehensive list is attached heretoas “Exhibit A”. The Police Department’s participation is part of thecommunity service provided to our citizens, with no cost to the City ofLaredo.

15. 2016-R-14 Authorizing the City Manager to execute this Memorandum of

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15. 2016-R-14 Authorizing the City Manager to execute this Memorandum ofAgreement (MOA) between South Texas Development Council (hereinafterSTDC) and the City of Laredo Fire Department in the amount of $20,000.00to form a management and administration structure to oversee, implement,and maintain the WebEOC for the South Texas Region 19. WebEOC is aweb based crisis information management system improving the ability toshare awareness of resources throughout the state and provide access toregional medical operation centers. local health departments, hospitals,emergency medical services, fire departments, and other emergencycenters across the state. Funds are appropriated in General Fund.

XII (b) MOTIONS

16. Authorizing the City Manager to award an Architectural and EngineeringServices contract in the amount of $ 163,560.00 to Sepulveda AssociatesArchitects, Inc., Laredo, Texas for the design, technical drawings, biddingdocuments, specifications, construction administration services withproduction printing, and as-built for the Utilities Department AdministrationBuilding. Funding is available in 2013 Sewer Revenue Bond and 14WW/SW Revenue Bond.

17. Authorizing the City Manager to award an Engineering Services contract in

the amount of $ 110,000.00 to Porras Nance Engineering, Laredo, Texas forthe topographic survey & preliminary schematics, plans, specs, biddingdocuments, estimates, TxDot Permit & Utility Coordination, easement plat &description, construction staking, coordination & administration, as-builtplans & close out documents for the 24" Waterline along Cuatro VientosRoad. Funding is available in the 2015 Water Revenue Bond.

18. Consideration to ratify the emergency contract issued to Bradley Motors,

Gregory, Texas, in the total amount of $51,805.00 for the repair of a 600 HPVertical Motor at Jefferson WTP East High Service Pump #1. These repairsare needed due to high service pump usage during the upcoming summermonths. Funding is available in the Utilities Department fund.

19. Authorizing the City Manager to enter into and execute a Toshiba

Governmental Copier Lease Program Contract with Toshiba BusinessSolutions (USA) Inc., San Antonio, TX, for the use of ninety nine (99) newcopiers; and authorizing that the equipment lease finance agent be LageLanden Public Finance, L.L.C. This lease is through a TEXAS DIR Contract,Toshiba Public Finance Contract and lease agreement shall be for a fortyeight (48) month period with an estimated lease contract total of$416,640.96. This contract is contingent on continued appropriations in

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future fiscal years and funding for the lease purchase payments shall beavailable in user departmental budgets.

20. Consideration to award contract FY16-027 to the sole bidder, Galls, LLC.,

Lexington, KY, in the estimated annual amount of $215,400.00, for thepurchase of uniforms, boots and accessories for the Fire Department. Theseitems are included in the Collective Bargaining Agreement between the Cityand the Firefighters Union. Each firefighter has a $600.00 clothingallowance that may be used to purchase any of the listed items in theagreement. The term of the contract is for three (3) years, subject to futurebudget appropriations. Contract has renewal options for two (2) additionalone year periods. Funding is available in General Fund - Fire Department'soperational budget.

21. Consideration to award annual supply contract FY16-022 to Neuhaus &

Company, Weslaco, Texas in an amount up to $50,000.00, for the purchaseof John Deere original equipment manufacturer (OEM) repair parts for theCity’s lawn maintenance equipment. All parts will be purchased on an asneeded basis. The term of this contract shall be for a period of one (1) yearbeginning as of the date of its execution. This contract has five extensionrenewal option periods, upon mutual agreement. Funding is available in theFleet Maintenance Budget.

22. Consideration to award a construction contract to the lowest bidder, ABBA

Construction, L.L.C., Laredo, Texas, in the base bid amount of $99,280.00for the Laredo Colombia International Bridge Expansion Joint Rehabilitationwith a construction contract time of ninety (90) calendar days; andauthorizing the City Manager to execute all related contract documentscontingent upon receipt and approval of insurance and bond documents.Completion date for the project is scheduled for May 2016. Funding isavailable in the Bridge 2008 Bond.

23. Authorizing the City Manager to renew contract FY15-027 for the Laredo

Lemurs Baseball 2016 season visiting team and special events lodgingexpenses with TownePlace Suites. The contract amount is not to exceed$102,000.00. Funding is available in the Laredo Convention and VisitorsBureau FY 2015-2016 budget.

END OF CONSENT AGENDA

XIII. GENERAL COUNCIL DISCUSSIONS AND PRESENTATIONS

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24.

A. Request by Mayor Pete Saenz

Exercise of Mayor's Veto of contract awarded to Altus Construction, atthe regular City Council Meeting on January 19, 2016; reference Agendaitem #24 of the January 19, 2016 published Agenda: award ofconstruction contract for the Galveston Street Waterline ReplacementProject.

a.

Discussion with possible action on status of ongoing independent audit ofFirst Recycling LLC, at landfill.

b.

Discussion with possible action entering into an Memorandum ofUnderstanding (MOU) with the Port of Corpus Christi, I-69 FreightCorridor.

c.

B. Request by Council Member Esteban Rangel

Discussion with possible action on the contract for the Chapter 380agreement for the Wright Ranch Subdivision at Cuatro Vientos East. (Co-Sponsored by Council Member Rudy Gonzalez)

a.

C. Request by Council Member Alejandro "Alex" Perez

Discussion with possible action to update the existing Tree Ordinance toinclude the protection of trees in private property from being removed fordevelopment. This item is in collaboration with Keep Laredo Beautiful.

a.

Discussion with possible action on installing a memorial for a fallenPolice Officer at Slaughter Park at the request of S.C.A.N.

b.

D. Mayor Pro-Tempore Juan Narvaez

Requesting assistance from each Council Member to help fund a mediabuy for an awareness campaign for the Cell Phone Ban Ordinance.

a.

E. Request by Council Member Charlie San Miguel

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E. Request by Council Member Charlie San Miguel

Discussion with possible action regarding the TIRZ for The Coves atWinfield.

a.

Discussion with possible action to recommend to the Charter ReviewCommittee that they consider an item for the ballot that would requireany and all City projects that are voted on by the public have an amountlimit/up to, included in the wording for the referendum.

b.

Discussion with possible action to evaluate options to correct the drasticand sharp contrast in elevation that is presenting a safety hazard at theShiloh and Loop 20 intersection.

c.

F. Request by Council Member George Altgelt

Discussion with possible action to allow public comments at all meetingsincluding special called meetings.

a.

Request for Qualification (RFQ) for a consultant to do a design plan for adedicated noncommercial route from the Max Mandel golf course toIH-35.

b.

Discussion with possible action to have the City of Laredo TrafficDepartment design and build a speed table at the intersection of PortIsabel and People's Blvd at the Green Ranch Subdivision that isconsistent with the Institute of Transportation Engineers -- ITE - designplan."

c.

G. Request by Council Member Roberto Balli

Discussion with possible action to create one or more “Safe Zones” –places where online buyers and sellers can meet to safely exchangemerchandise.

a.

H. Request by Council Member Rudy Gonzalez, Jr.

Discussion with possible action on installing surveillance equipment at allCity parks and recreation facilities to deter crime and vandalism.

a.

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XV. EXECUTIVE SESSION

The City Council hereby reserves the right to go into executive session at anytime during this public meeting, if such is requested by the City Attorney or otherlegal counsel for the City, pursuant to his or her duty under Section 551.071(2) ofthe Government Code, to consult privately with his or her client on an item on theagenda, or on a matter arising out of such item.

25. Request for executive session pursuant to Texas Government Code Section

551.072 to deliberate on-going negotiations regarding the value of realproperty located at north end of the Laredo International Airport, legallydescribed as an approximate 18.33-acre tract of land, Eastern Division,Laredo, Webb County, Texas. Acquisition of this tract would be formunicipal purposes, Runway Protection Zone.

XVII. ADJOURN AS THE LAREDO MASS TRANSIT BOARD AND RECONVENE ASTHE LAREDO CITY COUNCIL AND ADJOURN

This notice was posted at the Municipal Government Offices, 1110 HoustonStreet, Laredo, Texas, at a place convenient and readily accessible to the publicat all times. Said notice was posted on Wednesday, January 27, 2016 at 6:10 p.m.

_____________________________Doanh "Zone" T. NguyenActing City Secretary

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Public Hearings (also Intro Ord) 1. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Cynthia Collazo, Deputy City Manager Staff Source: Hector F. Gonzalez, MD, MPH, Director of Health

SUBJECTAuthorizing the City Manager to accept and enter into contract with the TexasDepartment of State Health Services (DSHS), amending the FY 2015-2016 Budget byappropriating additional revenues and expenditures in the amount of $200,000.00, andamending the FY 2015-2016 Full Time Equivalent (FTE) Listing by adding one (1)Health Educator Supervisor, R38 position and one (1) Caseworker, R34 position toimplement the Texas Healthy Adolescent Initiative (THAI) clinic-based program for theperiod beginning December 21, 2015 through August 31, 2016. This program will assistyouth to get preventive health care, behavioral health services and counseling thatmaybe needed to address social-psycho issues. (Approved by Operations andFinance Committees)

VENDOR INFORMATION FOR COMMITTEE AGENDAN/A

PREVIOUS COUNCIL ACTIONNone.

BACKGROUNDThe Department of State Health Services (DSHS), Office of Title V & Family Health willwork with City of Laredo Health Department (CLHD) to implement the Texas HealthyAdolescent Initiative (THAI) clinic-based program. The primary objective of the THAIclinic-based program is to improve the overall health and well-being of Texasadolescents, 10-24 years of age, increase their protective factors, prepare them with astrong foundation for adult life, and support positive life choices.

The THAI clinic-based program intends to positively impact youth services in thecommunity by providing funding for local clinics to focus on Positive Youth Development,provide support to youth in regards to managing health check-ups, provide education onrisk factors including bullying using CDC’s guidelines if available, and, address identifiedhealth risk factors through screening and referral as well as timely follow-up. ThroughTHAI clinic-based programming, the CLHD will establish a Youth-Adult Council tofacilitate the development and monitoring of strategies and activities. CLHD will partnerand subcontract for $83,060 with the Texas Campaign and Baylor School of Medicine toconduct evidenced based youth outreach services training and technical assistance andquality assurance evaluation.

Resources through this grant provide for the addition of two (2) full time equivalentpositions (FTEs); one (1) Health Educator Supervisor, R38 position and one (1)Caseworker, R34 position

COMMITTEE RECOMMENDATIONN/A

STAFF RECOMMENDATIONStaff recommends that Council introduce the Ordinance.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: NSource of Funds: DSHSAccount #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The revenue account 226-0000-323-4019 will increase by $200,000.00 and theexpenditure division 226-6035 with the project number HEAI01 will increase by$200,000.00.

AttachmentsOrdinanceBudgetContract

ORDINANCE

AUTHORIZING THE CITY MANAGER TO ACCEPTAND ENTER INTO CONTRACT WITH THE TEXAS DEPARTMENT OF STATE HEALTH SERVICES (DSHS), AMENDING THE FY 2015-2016 BUDGET BY APPROPRIATING ADDITIONAL REVENUES AND EXPENDITURES IN THE AMOUNT OF$200,000.00, AND AMENDING THE FY 2015-2016 FULL TIME EQUIVALENT (FTE) LISTING BY ADDING ONE (1) HEALTH EDUCATOR SUPERVISOR, R38 POSITION AND ONE (1) CASEWORKER, R34 POSITION TO IMPLEMENT THE TEXAS HEALTHY ADOLESCENT INITIATIVE (THAI) CLINIC-BASED PROGRAM FOR THE PERIOD BEGINNING DECEMBER 21, 2015 THROUGH AUGUST 31, 2016.

WHEREAS, the Department of State Health Services (DSHS), Office of Title V & Family Health will work with City of Laredo Health Department (CLHD) to implement the Texas Healthy Adolescent Initiative (THAI) clinic-based program. The primary objective of the THAI clinic-based program is to improve the overall health and well-being of Texas adolescents, 10-24 years of age, increase their protective factors, prepare them with a strong foundation for adult life, and support positive life choices; and

WHEREAS, the THAI clinic-based program intends to positively impact youth services in the community by providing funding for local clinics to focus on Positive Youth Development, provide support to youth in regards to managing health check-ups, provide education on risk factors including bullying using CDC’s guidelines if available, and, address identified health risk factors through screening and referral as well as timely follow-up. Through THAI clinic-based programming, the CLHD will establish a Youth-Adult Council to facilitate the development and monitoring of strategies and activities; and

WHEREAS, resources through this grant provide for the addition of two (2) full time equivalent positions (FTEs); one (1) Health Educator Supervisor, R38 position and one (1) Caseworker, R34 position.

NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT:

Section 1: The City Manager is hereby authorized to accept and enter into contract with the Texas Department of State Health Services (DSHS), amending the FY 2015-2016 Budget by appropriating additional revenues and expenditures in the amount of $200,000.00, and amending the FY 2015-2016 Full Time Equivalent (FTE) Listing by adding one (1) Health

2

Educator Supervisor, R38 position and one (1) Caseworker, R34 position to implement the Texas Healthy Adolescent Initiative (THAI) clinic-based program for the period beginning December 21, 2015 through August 31, 2016.

Section 2: The revenue account 226-0000-323-4019 is hereby increased by $200,000.00 and the expenditure division 226-6035 with the project number HEAI01 is hereby increased by $200,000.00.

Section 3: The City Manager is hereby authorized to make transfers within the budget as allowable under the Special Contract Provisions and General Provisions of the contract with HHSC to meet the necessary costs to accomplish the scope of work for the program.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON

THIS _________________ DAY OF ________________________, 2016.

______________________________PETE SAENZMAYOR

ATTEST:

_______________________________DOANH “ZONE” T. NGUYENACTING CITY SECRETARY

APPROVED AS TO FORM:

RAUL CASSO CITY ATTORNEY

________________________________KRISTINA K. LAUREL HALEASSISTANT CITY ATTORNEY

COUNCIL COMMUNICATION

BUDGETOTVFH- Texas Healthy Adolescent Initiative – Clinic Based

Division 6035; Project HEAI01

CATEGORIES APPROVED BUD.

REVENUES

TDSHS GRANT REVENUE $ 200,000

PROGRAM INCOME

TOTAL REVENUES $ 200,000

EXPENSES

PERSONNEL $ 65,726

OVERTIME 0

FRINGE BENEFITS 38,071

TRAVEL 1,312

EQUIPMENT 0

SUPPLIES 2,512

CONTRACTUAL 83,060

OTHER 9,319

SUB-TOTAL $ 200,000

RESERVE (PROGRAM INC.) 0

TOTAL $ 200,000

92648-1

DEPARTMENT OF STATE HEALTH SERVICES

This contract, number 2016-048897 (Contract), is entered into by and between the Department

of State Health Services (DSHS or the Department), an agency of the State of Texas, and CITY

OF LAREDO HEALTH DEPARTMENT (Contractor), a Government Entity, (collectively, the

Parties).

1. Purpose of the Contract. DSHS agrees to purchase, and Contractor agrees to provide,

services or goods to the eligible populations as described in the Program Attachments.

2. Total Amount of the Contract and Payment Method(s). The total amount of this Contract

is $200,000.00, and the payment method(s) shall be as specified in the Program Attachments.

3. Funding Obligation. This Contract is contingent upon the continued availability of funding.

If funds become unavailable through lack of appropriations, budget cuts, transfer of funds

between programs or health and human services agencies, amendment to the Appropriations Act,

health and human services agency consolidation, or any other disruptions of current appropriated

funding for this Contract, DSHS may restrict, reduce, or terminate funding under this Contract.

4. Term of the Contract. This Contract begins on 12/21/2015 and ends on 08/31/2016. DSHS

has the option, in its sole discretion, to renew the Contract as provided in each Program

Attachment. DSHS is not responsible for payment under this Contract before both parties have

signed the Contract or before the start date of the Contract, whichever is later.

5. Authority. DSHS enters into this Contract under the authority of Health and Safety Code,

Section 12.051.

6. Documents Forming Contract. The Contract consists of the following:

a. Core Contract (this document)

b. Program Attachments:

2016-048897-001 OTVFH - Texas Healthy Adolescent Initiative Clinic-Based

Program

c. General Provisions (Sub-recipient)

d. Solicitation Document(s), and

e. Contractor’s response(s) to the Solicitation Document(s).

f. Exhibits

92648-1

Any changes made to the Contract, whether by edit or attachment, do not form part of the

Contract unless expressly agreed to in writing by DSHS and Contractor and incorporated herein.

7. Conflicting Terms. In the event of conflicting terms among the documents forming this

Contract, the order of control is first the Core Contract, then the Program Attachment(s), then the

General Provisions, then the Solicitation Document, if any, and then Contractor’s response to the

Solicitation Document, if any.

8. Payee. The Parties agree that the following payee is entitled to receive payment for services

rendered by Contractor or goods received under this Contract:

Name: CITY OF LAREDO

Address: PO BOX 579

LAREDO, TX 78042-0579

Vendor Identification Number: 17460015732021

9. Entire Agreement. The Parties acknowledge that this Contract is the entire agreement of

the Parties and that there are no agreements or understandings, written or oral, between them

with respect to the subject matter of this Contract, other than as set forth in this Contract.

92648-1

By signing below, the Parties acknowledge that they have read the Contract and agree to its

terms, and that the persons whose signatures appear below have the requisite authority to execute

this Contract on behalf of the named party.

DEPARTMENT OF STATE HEALTH SERVICES CITY OF LAREDO HEALTH DEPARTMENT

By:__________________________

Signature of Authorized Official

By:___________________________

Signature

____________________________

Date

_____________________________

Date

Evelyn Delgado

______________________________

Printed Name and Title

Assistant Commissioner for Family and

Community Health Services

______________________________

Address

1100 WEST 49TH STREET

AUSTIN, TEXAS 78756

______________________________

City, State, Zip

512.776.7321

______________________________

Telephone Number

[email protected]

______________________________ E-mail Address for Official Correspondence

CONTRACT NO. 2016-048897

PROGRAM ATTACHMENT NO.001

PURCHASE ORDER NO. 0000421914

CONTRACTOR: CITY OF LAREDO HEALTH DEPARTMENT

DSHS PROGRAM: DSHS / Office of Title V & Family Health (DFCHS/THAI-CB)

TERM: 12/21/201511/01/2015 THRU: 08/31/2016 08/31/2016

SECTION I: STATEMENT OF WORK:

The Department of State Health Services (DSHS), Office of Title V & Family Health will work with

Contractor to implement the Texas Healthy Adolescent Initiative (THAI) clinic-based program. The

primary objective of the THAI clinic-based program is to improve the overall health and well-being

of Texas adolescents, 10-24 years of age, increase their protective factors, prepare them with a strong

foundation for adult life, and support positive life choices. The THAI clinic-based program intends to

positively impact youth services in the community by providing funding for local clinics to focus on

Positive Youth Development, provide support to youth in regards to managing health check-ups,

provide education on risk factors including bullying using CDC’s guidelines if available, and,

address identified health risk factors through screening and referral as well as timely follow-up.

Through THAI clinic-based programming, the contractor will establish a Youth-Adult Council to

facilitate the development and monitoring of strategies and activities.

SECTION II: PERFORMANCE MEASURES:

Year 1:

Contractor shall:

By 11/30/15, submit completed Youth-Friendly Services Self-Assessment Tool to DSHS;

By 12/31/15, organize a Youth-Adult Council recruitment meeting within the community on

the chosen risk factor(s);

Form a Youth-Adult Council (YAC) with required participation as noted in the FY16 RFP;

By 03/31/16, develop a Strategic Plan, with YAC input, to address the risk factors (listed

below) including screening tools as available;

By 04/30/16, establish Performance measures, with YAC input, for the clinic;

By 03/01/16, develop an Improvement Plan to address deficits in the Youth-Friendly

Services Self-Assessment Tool results using Positive Youth Development strategies;

By 06/01/16, begin Clinic Plan implementation;

Collect data for internal review on a monthly basis;

By 08/31/16, develop a Media Campaign;

By 08/31/16, review needs assessment / gap analysis from RFP;

Evaluate program components in coordination with and with input from DSHS’ external

evaluator throughout the contract term;

Submit required reports on the format provided by DSHS as requested by DSHS;

Participate in External Evaluation and data collection including External Evaluator monthly

calls and provision of requested data to the External Evaluation team;

Participate on conference calls and attend trainings (both in-person and webinar) as directed

by DSHS;

Participate in state-level Adolescent Health activities as directed by DSHS;

Document community-level impacts using data about the community including number

of screenings and referrals. This needs to include data pre- and post-introduction of THAI

clinic-based activities on Access to Care as well as the following risk factors:

o Motor Safety

o Juvenile delinquency

o Adolescent substance use

o Adolescent HIV/STD

o Mental Health / Suicide prevention

o Dating Violence

o Physical Activity / Nutrition

o Bullying; and

Participate in Adolescent and Young Adult Health Collaborative Innovation and

Improvement Network (AYAH CoIIN)

Year 2:

Contractor shall:

Re-administer the Youth-Friendly Services Self-Assessment Tool and submit findings

and Improvement Plan to DSHS;

Continue Clinic implementation;

Implement Media Campaign;

Continue to collect data for internal and external review;

Participate in External Evaluation and data collection;

Continue to participate in state-level activities as directed by DSHS;

Develop (if not provided by external evaluator) and distribute a Satisfaction survey for:

o YAC members

o Youth patients

o Family members;

Implement activities in the Improvement Plan; and

Review and update needs assessment and gap analysis.

Years 3:

Year Three will continue Clinic implementation and activities, specifically resource development for

coordination of services. During Year Three, internal and independent evaluations and client

satisfaction data will continue to be gathered for examining changes in youth resilience in YAC, and

effectiveness of Clinic implementation and modifications. The YAC will continue to focus on the

Youth-Friendly Services Self-Assessment Tool results and Improvement Plan for implementation as

well as provide general support and advice on Clinic implementation.

Contractor shall implement their approved work plan, and any subsequent revisions as approved

by DSHS. All activities must be performed in accordance with Contractor’s final approved work

plan.

All required reports shall be submitted to the Texas Healthy Adolescent Initiative Coordinator at

[email protected].

DSHS reserves the right, where allowed by legal authority, to redirect funds in the event of

financial shortfalls. DSHS Program will monitor Contractor’s expenditures on a quarterly basis.

If expenditures are below that projected in Contractor’s total contract amount as shown in

SECTION VII: BUDGET, Contractor’s budget shall be subject to a decrease for the remainder of

the Program Attachment term. Vacant positions existing after ninety (90) days may result in a

decrease in funds.

SECTION III: SOLICITATION DOCUMENT:

FY16 Competitive Request for Proposal (RFP) for Texas Healthy Adolescent Initiative Clinic-Based

Program #537-16-145991 posted on ESBD on August 18, 2015.

SECTION IV: RENEWALS:

DSHS may renew the Program Attachment for up to two (2) additional one-year terms, at DSHS’

sole discretion. Continued funding of the project in future years is contingent upon the availability of

funds and the satisfactory performance of the contractor during the prior budget period. Funding

may vary and is subject to change each budget period.

SECTION V: PAYMENT METHOD: Cost Reimbursement

SECTION VI: BILLING INSTRUCTIONS:

Contractor shall submit monthly requests for reimbursement for actual allowable costs incurred in

the provision of services under this Program Attachment. Contractor shall submit a State of Texas

Purchase Voucher (Form B-13) and a DSHS Monthly Reimbursement Request (MRR), Form EF21-

12004, within thirty (30) days following the end of the month covered by the voucher.

The Purchase Voucher shall be submitted electronically and simultaneously to the DSHS Claims

Processing Unit (CPU) email inbox and the Contract Development and Support Branch (CDSB)

email inbox.

CONTACT INFORMATION

Contract Development and Support Branch Email [email protected]

Claims Processing Unit Email [email protected]

mailto:[email protected]



Assigned DSHS Title V staff will review the voucher and the MRR. If either form is not submitted

or is unsatisfactory, DSHS staff will email a request for the missing document or for a revised

document. After approval by the Title V staff, the voucher will be forwarded to the Performance

Management Unit. After verifying funding information, the Performance Management Unit will send

approval to the Claims Processing Unit to process the voucher for payment.

Contractor must submit vouchers and MRRs monthly even if there are zero expenditures. Contractor

shall submit a reimbursement request as a final close-out bill not later than forty-five (45) days

following the end of the applicable Attachment term(s) for costs encumbered on or before the last

day of the Program Attachment term. Reimbursement requests received in DSHS offices more than

forty-five (45) days following the end of the applicable Program Attachment term will not be paid.

SECTION VII: BUDGET: Cost Reimbursement

Funding is further detailed in the attached Categorical Budget and, if applicable, Equipment List.

The specific dollar amount awarded to each successful respondent depends upon the merit and scope

of the proposal and other best value considerations and is at the sole discretion of DSHS.

Funding is further detailed in the attached Categorical Budget.

SOURCE OF FUNDS: CFDA 93.994.000#

SECTION VIII: SPECIAL PROVISIONS:

For purposes of this Program Attachment only, the following provisions shall apply:

General Provisions, Compliance and Reporting Article II, Reporting Section 2.05, is revised to

include the following:

Contractor shall submit quarterly reports within thirty (30) days after the end of each quarter

concerning the performance measures to DSHS; format for reports will be provided by DSHS Title

V staff unless external evaluation requirements alter this deliverable.

Contractor shall provide all final programmatic and financial reports for FY2016 no later than forty-

five (45) days after the end of the contact term (i.e. report shall be submitted by October 15, 2016).

FINANCIAL REPORTS

REPORT TITLE SUBMISSION FREQUENCY DUE DATE

Monthly Reimbursement

Request (Submit to Title V

Emails only)

Monthly Within thirty (30) days

following the end of the

month

State of Texas Purchase

Voucher (Form B-13) (Submit

to CPU Inbox and CDSB Inbox)

Monthly Within thirty (30) days

following the end of the

month covered by the bill.

Financial Status Report

(Form 269a)

Note: Form 269a should be sent

to DSHS, Claims Processing

Unit email address

([email protected]) as

well as the CDSB Inbox. Form

269a must have an original

signature for CPU.

Quarterly

September 1 – November 30

December 1 – February 29

March 1 - May 31

June 1 – August 31

Within thirty (30) days after

the end of each quarter;

final report due forty-five

(45) days after the end of

the contract term

December 30, 2015

March 30, 2016

June 30, 2016

September 30, 2016

General Provisions, Terms and Conditions of Payment Article VI, Prompt Payment Section 6.01,

is replaced with the following:

Program staff will evaluate the Contractor’s performance towards meeting contract deliverables and

progress towards meeting program expectations by February 29, 2016. If Contractor is unable to

meet performance measures by the established date, contract funds may be subject to a decrease (all

or in part) for the remainder of the contract term (March 1, 2016 through August 31, 2016).

General Provisions, Access, Inspection and Audit of Records Article X, Access and Inspection

Section 10.01, is revised to include the following:

Contractor shall allow DSHS to conduct on-site quality assurance reviews as deemed necessary by

DSHS. Unsatisfactory review findings may result in implementation of General Provisions, Breach

of Contract and Remedies for Non-Compliance Article XV.

General Provisions, General Business Operations of Contractor Article XIII, Changes to

Equipment List Section, is not applicable to this Program Attachment.


2016-048897-001

Categorical Budget:

Total reimbursements will not exceed $200,000.00

Financial status reports are due: 03/31/2016, 06/30/2016, 10/17/2016

PERSONNEL $65,726.00

FRINGE BENEFITS $38,071.00

TRAVEL $1,312.00

EQUIPMENT $0.00

SUPPLIES $2,512.00

CONTRACTUAL $83,060.00

OTHER $9,319.00

TOTAL DIRECT CHARGES $200,000.00

INDIRECT CHARGES $0.00

TOTAL $200,000.00

DSHS SHARE $200,000.00

CONTRACTOR SHARE $0.00

OTHER MATCH $0.00

Revised: 7/6/2009

Legal Name of Respondent:

CONTRACTOR NAME (Agency or Individual)

DESCRIPTION OF SERVICES (Scope of Work) Justification

METHOD OF PAYMENT

(i.e., Monthly, Hourly, Unit, Lump

Sum)

# of Months, Hours, Units,

etc.

RATE OF PAYMENT (i.e., hourly rate, unit rate, lump sum

amount)

TOTAL

The Texas Campaign to Prevent Teen Pregnancy

Consultant Services To conduct training of program staff to reach performance measures and to outreach to youth. Also for quality assurance and continuous improvement training and assessment.

Lump Sum 1

$83,060.00 $83,060$0$0$0$0$0$0$0$0$0

Total Amount Requested for CONTRACTUAL: $83,060

FORM I-5: CONTRACTUAL Budget Category Detail Form

List contracts for services related to the scope of work that is to be provided by a third party. If a third party is not yet identified, describe the service to be contracted and show contractors as “ToBe Named.” Justification for any contract that delegates $100,000 or more of the scope of the project in the respondent’s funding request, must be attached behind this form.

City of Laredo Health Department

TOTAL FROM CONTRACTUAL SUPPLEMENTAL BUDGET SHEETS

General Provisions (September 1, 2015) 1

Fiscal Year 2016 Department of State Health Services

Contract General Provisions

ARTICLE I CONTRACT COMPONENTS ....................................................................................................................... 4

SECTION 1.01 CONTRACT COMPONENTS ................................................................................................................................. 4 SECTION 1.02 ORDER OF PRECEDENCE ................................................................................................................................... 4

ARTICLE II COMPLIANCE AND REPORTING ............................................................................................................. 4

SECTION 2.01 COMPLIANCE .................................................................................................................................................... 4 SECTION 2.02 PRECEDENCE OF CONTRACT TERMS ................................................................................................................ 4 SECTION 2.03 EFFECT OF LEGISLATIVE CHANGES .................................................................................................................. 4 SECTION 2.04 COMPLIANCE WITH REQUIREMENTS OF SOLICITATION DOCUMENT ............................................................... 4 SECTION 2.05 REPORTING ....................................................................................................................................................... 4 SECTION 2.06 APPLICABLE CONTRACTS LAW AND VENUE FOR DISPUTES ............................................................................. 4 SECTION 2.07 STATUTES AND STANDARDS OF GENERAL APPLICABILITY ............................................................................... 4 SECTION 2.08 APPLICABILITY OF GENERAL PROVISIONS TO INTERAGENCY AND INTERLOCAL CONTRACTS ........................ 6 SECTION 2.09 CIVIL RIGHTS POLICY AND COMPLAINTS ......................................................................................................... 7 SECTION 2.10 LICENSES, CERTIFICATIONS, PERMITS, REGISTRATIONS AND APPROVALS ...................................................... 7 SECTION 2.11 FUNDING OBLIGATION ...................................................................................................................................... 7 SECTION 2.12 WHISTLEBLOWER ACT PROTECTION ............................................................................................................... 7

ARTICLE III SERVICES ...................................................................................................................................................... 7

SECTION 3.01 EDUCATION TO PERSONS IN RESIDENTIAL FACILITIES ..................................................................................... 7 SECTION 3.02 DISASTER SERVICES .......................................................................................................................................... 8 SECTION 3.03 CONSENT TO MEDICAL CARE OF A MINOR ....................................................................................................... 8 SECTION 3.04 TELEMEDICINE/TELEPSYCHIATRY MEDICAL SERVICES .................................................................................. 8 SECTION 3.05 SERVICES AND INFORMATION FOR PERSONS WITH LIMITED ENGLISH PROFICIENCY ...................................... 9

ARTICLE IV FUNDING ........................................................................................................................................................ 9

SECTION 4.01 DEBT TO STATE AND CORPORATE STATUS ....................................................................................................... 9 SECTION 4.02 APPLICATION OF PAYMENT DUE ...................................................................................................................... 9

ARTICLE V PAYMENT METHODS AND RESTRICTIONS .......................................................................................... 9

SECTION 5.01 PAYMENT METHODS ......................................................................................................................................... 9 SECTION 5.02 INVOICE/BILLING SUBMISSION ......................................................................................................................... 9 SECTION 5.03 FINAL INVOICE/BILLING SUBMISSION ............................................................................................................ 10 SECTION 5.04 THIRD PARTY PAYORS ................................................................................................................................... 10

ARTICLE VI TERMS AND CONDITIONS OF PAYMENT ........................................................................................... 10

SECTION 6.01 PROMPT PAYMENT ......................................................................................................................................... 10 SECTION 6.02 PAYMENT BY DEPARTMENT ........................................................................................................................... 10 SECTION 6.03 WITHHOLDING PAYMENTS ............................................................................................................................. 11

ARTICLE VII CONFIDENTIALITY ................................................................................................................................... 11

SECTION 7.01 MAINTENANCE OF CONFIDENTIALITY ............................................................................................................ 11 SECTION 7.02 DEPARTMENT ACCESS TO PHI AND OTHER CONFIDENTIAL INFORMATION .................................................. 11 SECTION 7.03 EXCHANGE OF CLIENT-IDENTIFYING INFORMATION ..................................................................................... 11 SECTION 7.04 SECURITY OF PATIENT OR CLIENT RECORDS ................................................................................................. 11 SECTION 7.05 HIV/AIDS MODEL WORKPLACE GUIDELINES .............................................................................................. 12


ARTICLE VIII PUBLIC INFORMATION ACT ................................................................................................................. 12

SECTION 8.01 TEXAS PUBLIC INFORMATION ACT ................................................................................................................ 12

ARTICLE IX RECORDS RETENTION ........................................................................................................................... 12

SECTION 9.01 RETENTION .................................................................................................................................................... 12

ARTICLE X ACCESS, INSPECTION AND AUDIT OF RECORDS ............................................................................. 12

SECTION 10.01 ACCESS AND INSPECTION ............................................................................................................................... 13 SECTION 10.02 STATE AUDITOR’S OFFICE ............................................................................................................................. 13 SECTION 10.03 RESPONDING TO DEFICIENCIES ...................................................................................................................... 13

ARTICLE XI REPORTING REQUIREMENTS .............................................................................................................. 13

SECTION 11.01 CHILD ABUSE REPORTING REQUIREMENT ..................................................................................................... 13 SECTION 11.02 SIGNIFICANT INCIDENTS ................................................................................................................................. 14 SECTION 11.03 LITIGATION .................................................................................................................................................... 14 SECTION 11.04 CONTRACT OR LICENSE ACTION AGAINST THE CONTRACTOR ...................................................................... 14 SECTION 11.05 INSOLVENCY ................................................................................................................................................... 14 SECTION 11.06 PERFORMANCE MALFEASANCE ...................................................................................................................... 14 SECTION 11.07 CRIMINAL ACTIVITY AND DISCIPLINARY ACTION ......................................................................................... 15 SECTION 11.08 RETALIATION PROHIBITED ............................................................................................................................ 15 SECTION 11.09 DOCUMENTATION .......................................................................................................................................... 15

ARTICLE XII ASSURANCES AND CERTIFICATIONS ................................................................................................. 15

SECTION 12.01 CERTIFICATION .............................................................................................................................................. 15 SECTION 12.02 CHILD SUPPORT DELINQUENCIES .................................................................................................................. 16 SECTION 12.03 AUTHORIZATION ............................................................................................................................................ 16 SECTION 12.04 GIFTS AND BENEFITS PROHIBITED ................................................................................................................. 16 SECTION 12.05 INELIGIBILITY TO RECEIVE THE CONTRACT .................................................................................................. 16 SECTION 12.06 ANTITRUST ..................................................................................................................................................... 17

ARTICLE XIII GENERAL BUSINESS OPERATIONS OF CONTRACTOR .................................................................. 17

SECTION 13.01 PROGRAM SITE ............................................................................................................................................... 17 SECTION 13.02 HISTORICALLY UNDERUTILIZED BUSINESSES (HUBS) ................................................................................... 17 SECTION 13.03 BUY TEXAS ..................................................................................................................................................... 17 SECTION 13.04 STATUS OF SUBCONTRACTORS ....................................................................................................................... 17 SECTION 13.05 INDEPENDENT CONTRACTOR .......................................................................................................................... 18 SECTION 13.06 TAX LIABILITY ............................................................................................................................................... 18 SECTION 13.07 NOTICE OF ORGANIZATIONAL CHANGE ......................................................................................................... 18 SECTION 13.08 NO ENDORSEMENT ......................................................................................................................................... 18 SECTION 13.09 E-VERIFY SYSTEM ......................................................................................................................................... 18

ARTICLE XIV GENERAL TERMS ..................................................................................................................................... 18

SECTION 14.01 ASSIGNMENT .................................................................................................................................................. 18 SECTION 14.02 LOBBYING ...................................................................................................................................................... 19 SECTION 14.03 CONFLICT OF INTEREST ................................................................................................................................. 19 SECTION 14.04 TRANSACTIONS BETWEEN RELATED PARTIES ............................................................................................... 20 SECTION 14.05 INTELLECTUAL PROPERTY ............................................................................................................................. 20 SECTION 14.06 OTHER INTANGIBLE PROPERTY ..................................................................................................................... 21 SECTION 14.07 SEVERABILITY AND AMBIGUITY ..................................................................................................................... 21 SECTION 14.08 LEGAL NOTICE ............................................................................................................................................... 21 SECTION 14.09 SUCCESSORS ................................................................................................................................................... 21 SECTION 14.10 SURVIVABILITY OF TERMS ............................................................................................................................. 21


SECTION 14.11 CUSTOMER SERVICE INFORMATION ............................................................................................................... 21 SECTION 14.12 AMENDMENT .................................................................................................................................................. 21 SECTION 14.13 CONTRACTOR’S NOTIFICATION OF CHANGE OF CONTACT PERSON OR KEY PERSONNEL ............................. 21 SECTION 14.14 UNILATERAL AMENDMENT ............................................................................................................................ 21 SECTION 14.15 INTERIM EXTENSION AMENDMENT ................................................................................................................ 22 SECTION 14.16 IMMUNITY NOT WAIVED ................................................................................................................................ 22 SECTION 14.17 HOLD HARMLESS AND INDEMNIFICATION ...................................................................................................... 22 SECTION 14.18 WAIVER .......................................................................................................................................................... 22 SECTION 14.19 ELECTRONIC AND INFORMATION RESOURCES ACCESSIBILITY AND SECURITY STANDARDS .......................... 22 SECTION 14.20 FORCE MAJEURE ........................................................................................................................................... 24 SECTION 14.21 COOPERATION AND COMMUNICATION ........................................................................................................... 24 SECTION 14.22 INSURANCE ..................................................................................................................................................... 24

ARTICLE XV BREACH OF CONTRACT AND REMEDIES FOR NON-COMPLIANCE ........................................... 25

SECTION 15.01 ACTIONS CONSTITUTING BREACH OF CONTRACT .......................................................................................... 25 SECTION 15.02 GENERAL REMEDIES AND SANCTIONS ............................................................................................................ 25 SECTION 15.03 NOTICE OF REMEDIES OR SANCTIONS ............................................................................................................ 26 SECTION 15.04 EMERGENCY ACTION ..................................................................................................................................... 26

ARTICLE XVI CLAIMS AGAINST THE DEPARTMENT-NOTICE OF DISPUTE ...................................................... 27

SECTION 16.01 BREACH OF CONTRACT CLAIM ...................................................................................................................... 27 SECTION 16.02 NOTICE ........................................................................................................................................................... 27 SECTION 16.03 PERFORMANCE NOT SUSPENDED ................................................................................................................... 27

ARTICLE XVII TERMINATION AND TEMPORARY SUSPENSION ............................................................................. 27

SECTION 17.01 EXPIRATION OF CONTRACT OR PROGRAM ATTACHMENTS ........................................................................... 27 SECTION 17.02 EFFECT OF TERMINATION OR EXPIRATION .................................................................................................... 27 SECTION 17.03 TERMINATION OR TEMPORARY SUSPENSION WITHOUT CAUSE ..................................................................... 27 SECTION 17.04 IMMEDIATE TERMINATION ............................................................................................................................. 28 SECTION 17.05 TERMINATION FOR CAUSE ............................................................................................................................. 28 SECTION 17.06 NOTICE OF TERMINATION .............................................................................................................................. 28

ARTICLE XVIII VOID, SUSPENDED AND TERMINATED CONTRACTS ..................................................................... 28

SECTION 18.01 VOID CONTRACTS .......................................................................................................................................... 28 SECTION 18.02 EFFECT OF VOID, SUSPENDED, OR INVOLUNTARILY TERMINATED CONTRACT ............................................. 28 SECTION 18.03 APPEALS RIGHTS FOR DSHS FUNDED BLOCK GRANTS ................................................................................. 28

ARTICLE XIX CLOSEOUT .................................................................................................................................................. 28

SECTION 19.01 CESSATION OF SERVICES AT CLOSEOUT ........................................................................................................ 28 SECTION 19.02 ADMINISTRATIVE OFFSET .............................................................................................................................. 29 SECTION 19.03 DEADLINE FOR CLOSEOUT ............................................................................................................................. 29 SECTION 19.04 PAYMENT OF REFUNDS ................................................................................................................................... 29 SECTION 19.05 DISALLOWANCES AND ADJUSTMENTS ............................................................................................................ 29


ARTICLE I CONTRACT COMPONENTS

Section 1.01 Contract Components. As used in herein, the “Contract” consists of the following documents: a. The Contract, including any applicable Program Attachment(s); The Department of State Health

Services Fiscal Year 2016 General Provisions (General Provisions) and if applicable; c. The solicitation document, if applicable; and d. The response, proposal or application submitted by Contractor in response to the solicitation document,

if applicable.

Section 1.02 Order of Precedence. To the extent that there is any conflict between the terms of any contract component document, the conflict shall be resolved in the above order of priority in Section 1.01.

ARTICLE II COMPLIANCE AND REPORTING

Section 2.01 Compliance. Contractor shall comply and require its subcontractor(s) to comply with the requirements of these general provisions and all other applicable state and federal statutes, regulations, rules and executive orders, as such statutes, regulations, rules and executive orders including as such statutes, regulations, rules and executive orders may be amended.

Section 2.02 Precedence of Contract Terms. To the extent this Contract imposes a higher standard or additional requirements beyond those required by applicable statutes, regulations, rules or executive orders, the terms of this Contract shall take precedence and control.

Section 2.03 Effect of Legislative Changes. Contractor agrees that upon notification from Department of State Health Services (DSHS or Department) Contractor shall comply with any changes to the term of the contract include in its contracts that are a result of legislation during the term of this Contract.

Section 2.04 Compliance with Requirements of Solicitation Document. If applicable and except as specified in these General Provisions or the Contract’s terms, the Contractor shall comply with the requirements, eligibility conditions, assurances, certifications and program requirements of the Solicitation Document for the duration of this Contract or any subsequent renewals. The Parties agree that the Department has relied upon Contractor’s response to the Solicitation Document. The Parties agree that any misrepresentation contained in Contractor’s response to the Solicitation Document constitutes a breach of this Contract and may result in termination.

Section 2.05 Reporting. Contractor shall submit reports in accordance with the reporting requirements established by the Department and provided for in the Contract and in these General Provisions. Except as otherwise provided for in this Contract or General Provisions, the Contractor shall submit reports to the assigned contract manager. Contractor shall also provide any other information requested by the Department in the format required by DSHS. Failure to submit any required report or additional requested information by the due date specified in the contract or upon request may constitute a breach of contract, result in delayed payment and/or the imposition of sanctions and remedies. And failure to comply with a reporting requirement may adversely affect evaluation of Contractor’s ability to contract in the future with the Department.

Section 2.06 Applicable Contracts Law and Venue for Disputes. Except as provided for in Article XV, all issues related to this contract, including formation, performance and interpretation that may arise in any dispute between the Parties, shall be governed by and construed in accordance with the laws of the State of Texas and venue shall be in Travis County, Texas.

Section 2.07 Statutes and Standards of General Applicability. Contractor is responsible for reviewing and complying with all applicable statutes, rules, regulations, executive orders and policies. To the extent applicable


to Contractor, Contractor shall comply with the following:

a. Statutes, rules, regulations, and DSHS policy (and any of their subsequent amendments) that collectively prohibit discrimination, exclusion from or limitation of participation in programs, benefits or activities or denial of any aid, care, service or other benefit on the basis of race, color, national origin, limited English proficiency, sex, sexual orientation (where applicable), disabilities, age, substance abuse, political belief or religion: 1. Title VI of the Civil Rights Act of 1964, 42 USC §§ 2000d et seq.; 2. Title IX of the Education Amendments of 1972, 20 USC §§ 1681-1683, and 1685-1686; 3. Section 504 of the Rehabilitation Act of 1973, 29 USC § 794(a); 4. Americans with Disabilities Act of 1990, 42 USC §§ 12101 et seq.; 5. Age Discrimination Act of 1975, 42 USC §§ 6101-6107; 6. Comprehensive Alcohol Abuse and Alcoholism Prevention, Treatment and Rehabilitation Act of

1970, 42 USC § 290dd (b)(1); 7) 45 CFR Parts 80, 84, 86 and 91; 7. U.S. Department of Labor, Equal Employment Opportunity E.O. 11246; 8. Tex. Labor Code Chapter 21; 9. Food Stamp Act of 1977 (7 USC §§ 2011 et seq.); 10. Executive Order 13279, 45 CFR Part 87 or 7 CFR Part 16 regarding equal treatment and

opportunity for religious organizations; 11. Drug Abuse Office and Treatment Act of 1972, 21 USC §§ 1101 et seq., relating to drug abuse; 12. Public Health Service Act of 1912, §§ 523 and 527, 42 USC § 290dd-2, and 42 CFR pt. 2, relating

to confidentiality of alcohol and drug abuse patient records; 13. Title VIII of the Civil Rights Act of 1968, 42 USC §§ 3601 et seq., relating to nondiscrimination in

housing; and 14. DSHS Policy AA-5018, Non-discrimination Policy for DSHS Programs;

b. Immigration Reform and Control Act of 1986, 8 USC § 1324a, and Immigration Act of 1990, 8 USC 1101 et seq., as amended by Public Law113-4 (March 7, 2013), regarding employment verification; and Illegal Immigration Reform and Immigrant Responsibility Act of 1996;

c. Pro-Children Act of 1994, 20 USC §§ 6081-6084, and the Pro-Children Act of 2001, 20 USC § 7183, regarding the non-use of all tobacco products;

d. National Research Service Award Act of 1971, 42 USC §§ 289a-1 et seq., and 6601 (P.L. 93-348 and P.L. 103-43), regarding human subjects involved in research;

e. Hatch Political Activity Act, 5 USC §§ 1501-1508 and 7324-26, which limits the political activity of employees whose employment is funded with federal funds;

f. Fair Labor Standards Act, 29 USC §§ 201 et seq., and the Intergovernmental Personnel Act of 1970, 42 USC §§ 4701 et seq., as applicable, concerning minimum wage and maximum hours;

g. Texas Government Code Chapter 469 pertaining to eliminating architectural barriers for persons with disabilities;

h. Texas Workers’ Compensation Act, Texas Labor Code Chapters 401-406, and 28 Texas Administrative Code (TAC) pt. 2, regarding compensation for employees’ injuries;

i. The Clinical Laboratory Improvement Amendments of 1988, 42 USC § 263a, regarding the regulation and certification of clinical laboratories;

j. The Occupational Safety and Health Administration Regulations on Blood Borne Pathogens, 29 CFR § 1910.1030, or Title 25 Tex. Admin Code Chapter 96 regarding safety standards for handling blood borne pathogens;

k. Laboratory Animal Welfare Act of 1966, 7 USC §§ 2131 et seq., pertaining to the treatment of laboratory animals;

l. Environmental standards pursuant to the following: 1. Institution of environmental quality control measures under the National Environmental Policy Act

of 1969, 42 USC §§ 4321-4347 and Executive Order 11514 (35 Fed. Reg. 4247), “Protection and Enhancement of Environmental Quality;”


2. Notification of violating facilities pursuant to Executive Order 11738 (40 CFR Part 32), “Providing for Administration of the Clean Air Act and the Federal Water Pollution Control Act with respect to Federal Contracts, Grants, or Loans;”

3. Protection of wetlands pursuant to Executive Order 11990, 42 Fed. Reg. 26961; 4. Evaluation of flood hazards in floodplains in accordance with Executive Order 11988, 42 Fed. Reg.

26951 and, if applicable, flood insurance purchase requirements of Section 102(a) of the Flood Disaster Protection Act of 1973 (P.L. 93-234);

5. Assurance of project consistency with the approved State Management program developed under the Coastal Zone Management Act of 1972, 16 USC §§ 1451 et seq.;

6. Federal Water Pollution Control Act, 33 USC §§ 1251 et seq.; 7. Protection of underground sources of drinking water under the Safe Drinking Water Act of 1974, 42

USC §§ 300f-300j; 8. Protection of endangered species under the Endangered Species Act of 1973, 16 USC §§ 1531 et

seq.; 9. Conformity of federal actions to state clean air implementation plans under the Clean Air Act of

1955, 42 USC §§ 7401 et seq.; 10. Wild and Scenic Rivers Act of 1968, 16 USC §§ 1271 et seq., related to protecting certain river

systems; and m. Lead-Based Paint Poisoning Prevention Act, 42 USC §§ 4821 et seq., prohibiting the use of lead-based

paint in residential construction or rehabilitation; n. Intergovernmental Personnel Act of 1970, 42 USC §§ 4278-4763, regarding personnel merit

systems for programs specified in Appendix A of the federal Office of Program Management’s Standards for a Merit System of Personnel Administration, 5 CFR Part1200 et seq;

o. Titles II and III of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of, 42 USC §§4601 et seq (PL 91-646), relating to fair treatment of persons displaced or whose property is acquired as a result of Federal or federally-assisted programs;

p. Davis-Bacon Act, 40 USC §§ 3141-3148; q. Copeland Act, 40 USC §§ 276c and 18 USC § 874; r. Contract Work Hours and Safety Standards Act, 40 USC § 3702 et seq., regarding labor standards for

federally-assisted construction subagreements; s. National Historic Preservation Act of 1966, § 106, 16 USC § 470; Executive Order 11593; and the

Archaeological and Historic Preservation Act of 1974 (16 USC §§ 469a-1 et seq.) regarding historic property to the extent necessary to assist DSHS in complying with the Acts;

t. Trafficking Victims Protection Act of 2000, Section 106(g) (22 USC § 7104); u. Executive Order 13513 (Oct. 1, 2009), Federal Leadership on Reducing Text Messaging While Driving,

October 1, 2009, if required by a federal funding source of this Contract; v. Whistleblower Protection Enhancement Act (5 U.S.C. 2302(b)(8)) and Texas Whistleblower Act (Tex.

Gov. Code Chapter 554); and w. Requirements of any other applicable state and federal statutes, executive orders, regulations, rules and

policies.

Section 2.08 Applicability of General Provisions to Interagency and Interlocal Contracts. a. The following sections or portions of sections of these General Provisions shall not apply to Interagency

Cooperation Contracts (Texas Government Code 771) or Interlocal Cooperation Contracts (Texas Government Code Chapter 791):

1. Hold Harmless and Indemnification, Section 14.17; 2. Independent Contractor, Section 13.05; 3. Historically Underutilized Businesses (HUBs), Section 13.02 (Contractor, however, shall comply

with HUB requirements of other statutes and rules specifically applicable to that entity; 4. Debt to State and Corporate Status, Section 4.01;


5. Application of Payment Due, Section 4.02; and 6. Article XVI Claims against the Department.

b. The following additional provisions shall apply to Interlocal Cooperation Contracts:

1. Payments made by DSHS to Contractor shall be from current revenues available to DSHS; and 2. Each Party represents that it has been authorized to enter into this Contract.

Section 2.09 Civil Rights Policy and Complaints. Upon request, Contactor shall provide the Health and Human Services Commission (HHSC) Civil Rights Office with copies of all Contractor’s civil rights policies and procedures. Contractor shall notify HHSC’s Office of Civil Rights of any civil rights complaints received relating to performance under this Contract no more than ten calendar days after Contractor’s receipt of the claim. Notice must be directed to:

Civil Rights Office Health and Human Services Commission 701 W. 51st Street, Mail Code W206 Austin, Texas 78751 (888) 388-6332 or 512-438-4313 TTY Toll-free (877) 432-7232 [email protected]

Section 2.10 Licenses, Certifications, Permits, Registrations and Approvals. Contractor shall obtain and maintain all applicable licenses, certifications, permits, registrations and approvals to conduct its business and to perform the services under this Contract. Failure to obtain or any revocation, surrender, expiration, non-renewal, inactivation or suspension of any such license, certification, permit, registration or approval constitutes grounds for termination of this Contract or other remedies the Department deems appropriate. Contractor shall ensure that all its employees, staff and volunteers obtain and maintain in active status all licenses, certifications, permits, registrations and approvals required to perform their duties under this Contract and shall prohibit any person who does not hold a current, active required license, certification, permit, registration or approval from performing services under this Contract.

Section 2.11 Funding Obligation. This Contract is contingent upon the availability of funding. If funds become unavailable through lack of appropriations, budget cuts, transfer of funds between programs or health and human services agencies, amendment of the Appropriations Act, health and human services agency consolidation, or any other disruptions of current appropriated funding for this Contract, DSHS may restrict, reduce or terminate funding under this Contract. Notice of any restriction or reduction shall include instructions and detailed information on how DSHS shall fund the services and/or goods to be procured with the restricted or reduced funds.

Section 2.12 Whistleblower Act Protection. This Contract is required to include the Whistleblower Protection Acts (See Section 2.07(v)) protections to grantees, their subgrantees and subcontractors, and contractor must inform their employees of whistleblowers’ rights and remedies. The requirement is in effect for all grants, contracts, subgrants, and subcontractors issued beginning July 1, 2013 through January 1, 2017.

ARTICLE III SERVICES

Section 3.01 Education to Persons in Residential Facilities. If applicable, Contractor shall ensure that all persons, who are housed in Department-licensed and/or -funded residential facilities and are 22 years of age or younger, have access to educational services as required by Texas Education Code § 29.012.



Contractor shall notify the local education agency or local early intervention program as prescribed by this Section not later than the third calendar day after the date a person who is 22 years of age or younger is placed in Contractor’s residential facility.

Section 3.02 Disaster Services. In the event of a local, state, or federal emergency, including natural, man- made, criminal, terrorist, and/or bioterrorism events, declared as a state disaster by the Governor, or a federal disaster by the appropriate federal official, Contractor may be called upon to assist DSHS in providing services, as appropriate, in the following areas:

a. Community evacuation; b. Health and medical assistance; c. Assessment of health and medical needs; d. Health surveillance; e. Medical care personnel; f. Health and medical equipment and supplies; g. Patient evacuation; h. In-hospital care and hospital facility status; i. Food, drug and medical device safety; j. Worker health and safety; k. Mental health and substance abuse; l. Public health information; m. Vector control and veterinary services; and n. Victim identification and mortuary services.

Contractor shall carry out disaster services in the manner most responsive to the needs of the emergency, in the most cost-effective, and least intrusive manner to Contractor’s primary services.

Section 3.03 Consent to Medical Care of a Minor. If Contractor provides medical, dental, psychological or surgical treatment to a minor under this Contract, either directly or through contracts with subcontractors, Contractor shall not provide treatment of a minor unless informed consent to treatment is obtained pursuant to Texas Family Code Chapter 32 relating to consent to treatment of a child by a non-parent or the child or other state law. If requirements of federal law relating to consent directly conflict with this Chapter, then federal law supersedes state law.

Section 3.04 Telemedicine/Telepsychiatry Medical Services. If applicable, the Contractor shall ensure that if Contractor or its subcontractor uses telemedicine/telepsychiatry that the services are implemented in accordance with written procedures and using a protocol approved by Contractor’s medical director and using equipment that complies with the equipment standards as required by the Department. Procedures for providing telemedicine service must include the following requirements:

a. Clinical oversight by Contractor’s medical director or designated physician responsible for medical

leadership; b. Contraindication considerations for telemedicine use; c. Qualified staff members to ensure the safety of the individual being served by telemedicine at the

remote site; d. Safeguards to ensure confidentiality and privacy in accordance with state and federal laws; e. Use by credentialed licensed providers providing clinical care within the scope of their licenses; f. Demonstrated competency in the operations of the system by all staff members who are involved in the

operation of the system and provision of the services prior to initiating the protocol; g. Priority in scheduling the system for clinical care of individuals; h. Quality oversight and monitoring of satisfaction of the individuals served; and


i. Management of information and documentation for telemedicine services that ensures timely access to accurate information between the two sites. Telemedicine Medical Services does not include chemical dependency treatment services provided by electronic means under 25 TAC Rule § 448.911.

Section 3.05 Services and Information for Persons with Limited English Proficiency.

a. Contractor shall take reasonable steps to provide services and information both orally and in writing, in

appropriate languages other than English, to ensure that persons with limited English proficiency are effectively informed and can have meaningful access to programs, benefits and activities.

b. Contractor shall identify and document on the client records the primary language/dialect of a client

who has limited English proficiency and the need for translation or interpretation services and shall not require a client to provide or pay for the services of a translator or interpreter.

c. Contractor shall make every effort to avoid use of any persons under the age of 18 or any family

member or friend of the client as an interpreter for essential communications with a client with limited English proficiency unless the client has requested that person and using the person would not compromise the effectiveness of services or violate the client’s confidentiality and the client is advised that a free interpreter is available.

ARTICLE IV FUNDING

Section 4.01 Debt to State and Corporate Status.

a. Pursuant to Texas Government Code § 403.055, the Department shall not approve and Texas Comptroller of Public Accounts shall not issue payment to Contractor if Contractor is indebted to the State for any reason, including a tax delinquency.

b. Contractor, if a corporation, certifies by execution of this Contract that it is current and shall remain

current in its payment of franchise taxes to the State of Texas or that it is exempt from payment of franchise taxes under Texas law (Texas Tax Code §§ 171.001 et seq.). As a corporation, this Contractor further certifies that it is and shall remain in good standing with the Secretary of State’s office.

c. A false statement regarding franchise tax or corporate status is a material breach of this Contract. If

franchise tax payments become delinquent during the Contract term, all or part of the payments under this Contract may be withheld until Contractor’s delinquent franchise tax is paid in full.

Section 4.02 Application of Payment Due. Contractor agrees that any payments due under this Contract shall be applied towards any debt of Contractor, including but not limited to delinquent taxes and child support that is owed to the State of Texas.

ARTICLE V PAYMENT METHODS AND RESTRICTIONS

Section 5.01 Payment Methods. Except as otherwise provided by the provisions of this Contract, the payment method is based on a unit rate (fixed price or a specified) or fee for service (delivery of a specified unit of service) as stated in the Contract. Section 5.02 Invoice/Billing Submission.


a. Contractor shall bill the Department in accordance with the Contract in the form and format prescribed by DSHS. If applicable, the Contractor must submit of all required documentation, reports, forms and/or deliverables in order to receive payment from the Department.

b. Unless otherwise specified in the Contract or permitted under the Third Party Payors (See Section 5.04

below), Contractor shall submit requests for payment monthly by the last business day of the month following the end of the month covered by the bill.

c. Contractor shall maintain all documentation that substantiates billing submissions and make the

documentation available to DSHS upon request.

Section 5.03 Final Invoice/Billing Submission. Unless otherwise provided by the Department, Contractor shall submit a reimbursement or payment request as a final close-out bill not later than 45 calendar days following the end of the term of the Contract.

Section 5.04 Third Party Payors. Except as provided in this Contract, Contractor shall screen all clients and may not bill the Department for services eligible for reimbursement from third party payors, who are any person or entity who has the legal responsibility for paying for all or part of the services provided, including commercial health or liability insurance carriers, Medicaid, or other federal, state, local and private funding sources.

As applicable, the Contractor shall:

a. Enroll as a provider in Children’s Health Insurance Program and Medicaid if providing approved services

authorized under this Contract that may be covered by those programs and bill those programs for the covered services;

b. Provide assistance to individuals to enroll in such programs when the screening process indicates possible eligibility for such programs;

c. Allow clients that are otherwise eligible for Department services, but cannot pay a deductible required by a third party payor, to receive services up to the amount of the deductible and to bill the Department for the deductible;

d. Not bill the Department for any services eligible for third party reimbursement until all appeals to third party payors have been exhausted;

e. Maintain appropriate documentation from the third party payor reflecting attempts to obtain reimbursement;

f. Bill all third party payors for services provided under this Contract before submitting any request for reimbursement to Department; and

g. Provide third party billing functions at no cost to the client.

ARTICLE VI TERMS AND CONDITIONS OF PAYMENT

Section 6.01 Prompt Payment. Upon receipt of a timely, undisputed invoice pursuant to this Contract, Department shall pay Contractor. Payments are contingent upon a signed Contract and shall not exceed the total amount of authorized funds under this Contract. Contractor is entitled to payment only if the service, work, and/or product has been authorized by the Department and performed or provided pursuant to this Contract. If these conditions are met, Department shall make payment in accordance with the Texas Prompt Payment Act (Texas Government Code Chapter 2251). Contractor acknowledges and agrees that it shall comply with the provisions in the Texas Prompt Payment Act regarding its prompt payment of its financial obligations to its subcontractors.

Section 6.02 Payment by Department. Payment of invoices by the Department shall not constitute acceptance or approval of Contractor’s performance nor foreclose the right of the Department and HHSC to recover excessive or illegal payments. All invoices and Contractor’s performance are subject to review and audit by the Department.


Section 6.03 Withholding Payments. Department may withhold all or part of any payments to Contractor to offset overpayments that Contractor has not refunded to Department. Department may take repayment from funds due to the Contractor for services performed or goods delivered in amounts necessary to fulfill Contractor’s repayment obligations.

ARTICLE VII CONFIDENTIALITY

Section 7.01 Maintenance of Confidentiality. Contractor must maintain the privacy and confidentiality of information and records received during or related to the performance of this Contract, including patient and client records that contain protected health information (PHI) and any other information that discloses confidential personal information or identifies any client served by DSHS in accordance with any applicable federal and state law, rules and regulations, including but not limited to:

a. 7 Code of Federal Regulations (CFR) Part 246; 42 CFR Part 2, 45 CFR Parts 160 and 164 (Health

Insurance Portability and Accountability Act [HIPAA]); b. Texas Health and Safety Code Chapters 12, 47, 81, 82, 85, 88, 92, 161, 181, 241, 245, 251, 534, 576,

577, 596, 611 and 773; c. Texas Occupations Code, Chapters 56 and 159; and d. Any other applicable federal and state laws, rules or regulations.

The HHS Data Use Agreement (Version 8.3) at http://www.hhsc.state.tx.us/about_hhsc/BusOpp/data-use- agreement.pdf is incorporated as part of the Contract and describes Contractor’s rights and obligations with respect to the Confidential Information and the limited purposes, for which the Contractor may create, receive, maintain, use, disclose or have access to Confidential Information. For the purpose of this Contract, the:

Contractor does not access Confidential Information and does not have to comply with HHS Data Use Agreement (Version 8.3); or

Contractor accesses Confidential Information as defined in and agrees to comply with the HHS Data Use

Agreement (Version 8.3).

Section 7.02 Department Access to PHI and Other Confidential Information. Contractor shall cooperate with Department to allow Department to request, collect and receive PHI and other confidential information under this Contract, without the consent of the individual to whom the PHI relates, for funding, payment and administration of the grant program and for purposes permitted under applicable state and federal confidentiality and privacy laws.

Section 7.03 Exchange of Client-Identifying Information. Except as prohibited by other law, Contractor and DSHS shall exchange PHI without the consent of clients in accordance with 45 CFR § 164.504(e)(3)(i)(B), Texas Health and Safety Code § 533.009 and 25 TAC Chapter 414, Subchapter A or any other applicable federal or state laws, rules or regulations.

Contractor shall disclose information described in Texas Health and Safety Code § 614.017(a)(2) relating to special needs offenders, to an agency described in Texas Health and Safety Code § 614.017(c) upon request of that agency, unless Contractor documents that the information is not allowed to be disclosed under 45 CFR Part 164 or other applicable law.

Section 7.04 Security of Patient or Client Records. Contractor shall ensure that patient and client records are managed in compliance with state and federal law relating to security and retention of medical or mental health and substance abuse patient and client records. Department may require Contractor to transfer original or copies of patient and client records to Department, without the consent or authorization of the patient or client, upon termination of this Contract or a Contract to

http://www.hhsc.state.tx.us/about_hhsc/BusOpp/data-use-agreement.pdf

http://www.hhsc.state.tx.us/about_hhsc/BusOpp/data-use-agreement.pdf


this Contract, as applicable, or if the care and treatment of the individual patient or client is transferred to another entity. Prior to providing services funded under this Contract to a patient or client, Contractor shall attempt to obtain consent from the patient or client to transfer copies of patient or client records to another entity funded by DSHS upon termination of this Contract or a Contract to this Contract, as applicable or if care or treatment is transferred to another DSHS-funded contractor.

Section 7.05 HIV/AIDS Model Workplace Guidelines. If providing direct client care, services, or programs, Contractor shall implement Department’s policies based on the HIV/AIDS (human immunodeficiency virus/acquired immunodeficiency syndrome), AIDS Model Workplace Guidelines for Businesses, State Agencies and State Contractors Policy No. 090.021. Contractor shall also educate employees and clients concerning HIV and its related conditions, including AIDS, in accordance with the Texas. Health & Safety Code §§ 85.112-114. A link to the Model Workplace Guidelines can be found at: http://www.dshs.state.tx.us/hivstd/policy/policies.shtm .

ARTICLE VIII PUBLIC INFORMATION ACT

Section 8.01 Texas Public Information Act. The Contractor understands that DSHS shall comply with the Texas Public Information Act (Texas Government Code Chapter 552).

If the Contractor is not a state agency, institution of higher education or other governmental entity, then the Contractor is required to make any information created or exchanged with the state pursuant to a contract, which is not otherwise excepted from disclosure under the Texas Public Information Act, available in a format that is accessible by the public at no additional charge to the state.

ARTICLE IX RECORDS RETENTION

Section 9.01 Retention.

a. Contractor shall retain and preserve records in accordance with applicable state and federal statutes, rules and regulations. At a minimum, Contractor shall maintain all records, including but not limited to financial that are generated or collected by Contractor under the provisions of this Contract for a period of four years after the termination of this Contract.

b. If the federal retention period for services are funded through Medicaid is more than four years, then the

Contractor will retain the records for longer period of time.

c. Contractor shall retain all records pertaining to this Contract that are the subject of litigation or an audit until the litigation has ended or all questions pertaining to the audit are resolved.

d. Contractor shall retain medical records in accordance with 22 TAC §165.1(b) or other applicable statutes,

rules and regulations governing medical information.

e. Contractor shall include this provision concerning records retention in any subcontract it awards.

f. Contractor ceases business operations, it shall ensure that records relating to this Contract are securely stored and are accessible by the Department upon Department's request for at least four years from the date Contractor ceases business or from the date this Contract terminates, whichever is sooner.

g. Contractor shall provide, and update as necessary, the name and address of the party responsible for storage

of records to the contract manager assigned to this Contract.

ARTICLE X ACCESS, INSPECTION AND AUDIT OF RECORDS

http://www.dshs.state.tx.us/hivstd/policy/policies.shtm


Section 10.01 Access and Inspection. In addition to any right of access arising by operation of law, Contractor and any of Contractor’s affiliate or subsidiary organizations or subcontractors shall permit the Department or any of its duly authorized representatives, as well as duly authorized federal, state or local authorities, including the Comptroller General of the United States, the Office of the Inspector General at HHSC (OIG) and the State Auditor’s Office (SAO) or any of their successor agencies, unrestricted access to and the right to examine any site where business is conducted or client services are performed, and all records, which includes but is not limited to financial, client and patient records, books, papers or documents related to this Contract. If deemed necessary by the Department or the OIG, for the purpose of investigation or hearing, Contractor shall produce original documents related to this Contract. The Department and HHSC shall have the right to audit billings both before and after payment, and all documentation that substantiates the billings.

Contractor shall include this provision concerning the right of access to, and examination of, sites and information related to this Contract in any subcontract it awards.

Section 10.02 State Auditor’s Office. Contractor shall, upon request, make all records, books, papers, documents, or recordings related to this Contract available for inspection, audit, or reproduction during normal business hours to any authorized representative of the SAO. Contractor understands that the acceptance of funds under this Contract acts as acceptance of the authority of the SAO, or any successor agency, to conduct an audit or investigation in connection with those funds. Contractor shall cooperate fully with the SAO or its successor in the conduct of the audit or investigation, including providing all records requested, and providing access to any information the SAO considers relevant to the investigation or audit. The SAO’s authority to audit funds shall apply to Contract funds disbursed by Contractor to its subcontractors, and Contractor shall include this provision concerning the SAO’s authority to audit and the requirement to cooperate, in any subcontract Contractor awards.

Section 10.03 Responding to Deficiencies. Any deficiencies identified by DSHS or HHSC upon examination of Contractor’s records or during an inspection of Contractor’s site shall be conveyed in writing to Contractor. Contractor shall submit, by the date prescribed by DSHS, a resolution to the deficiency identified in a site inspection, program review or management or financial audit to the satisfaction of DSHS or, if directed by DSHS, a corrective action plan to document and resolve the deficiency. A DSHS or HHSC determination of either an inadequate or inappropriate resolution of the findings may result in contract remedies or sanctions under the Breach of Contract and Remedies for Non-Compliance (See Article XV).

ARTICLE XI REPORTING REQUIREMENTS

Section 11.01 Child Abuse Reporting Requirement. This section applies to mental health and substance abuse contractors and contractors for the following public health programs:

a. Human Immunodeficiency Virus/Sexually Transmitted Diseases (HIV/STD); b. Family Planning; c. Primary Health Care; d. Maternal and Child Health; and e. Women, Infants and Children (WIC) Nutrition Services.

All Contractors shall comply with child abuse reporting guidelines and requirements in Texas Family Code Chapter 261 relating to investigations of reports of child abuse and neglect.

Contractor shall develop, implement and enforce a written policy that includes at a minimum the Department’s Child Abuse Screening, Documenting, and Reporting Policy for Contractors/Providers and train all staff on reporting requirements.


Contractor shall use the DSHS Child Abuse Reporting Form located at www.dshs.state.tx.us/childabusereporting as required by the Department. Contractor shall retain reporting documentation on site and make it available for inspection by DSHS.

This section is in addition to and does not supersede any other legal obligation of the Contractor to report child abuse.

Section 11.02 Significant Incidents. In addition to notifying the appropriate authorities, Contractor shall report to the contract manager assigned to the Contract significant incidents involving substantial disruption of Contractor’s program operation or affecting or potentially affecting the health, safety or welfare of Department funded clients or participants within 72 hours of discovery.

Section 11.03 Litigation. Contractor shall notify the contract manager assigned to this Contract of litigation related to or affecting this Contract and to which Contractor is a party within seven calendar days of becoming aware of such a proceeding. This includes, but is not limited to an action, suit or proceeding before any court or governmental body, which includes but is not limited to environmental and civil rights matters, professional liability and employee litigation. Notification must include the names of the parties, nature of the litigation and remedy sought, including amount of damages, if any.

Section 11.04 Contract or License Action Against the Contractor. Contractor shall notify the contract manager assigned to the contract if Contractor has had any contract suspended or terminated for cause by any local, state or federal department or agency or nonprofit entity within three working days of the suspension or termination. Such notification must include the:

a. Reason for such action; b. Name and contact information of the local, state or federal department or agency or entity; c. Date of the contract; d. Date of suspension or termination; and e. Contract or case reference number.

If Contractor has surrendered its license or has had its license suspended or revoked by any local, state or federal department or agency or non-profit entity, it shall disclose this information within three working days of the surrender, suspension or revocation to the contract manager assigned to the Contract by submitting a one- page description that includes the:

a. Reason for such action; b. Name and contact information of the local, state or federal department or agency or entity; c. Date of the license action; and d. License or case reference number.

Section 11.05 Insolvency. Contractor shall notify in writing the contract manager assigned to the Contract of Contractor’s insolvency, incapacity or outstanding unpaid obligations to the Internal Revenue Service (IRS) or Texas Workforce Commission (TWC) within three working days of the date of determination that Contractor is insolvent or incapacitated or the date Contractor discovered an unpaid obligation to the IRS or TWC. The Contractor shall also notify in writing the contract manager assigned of its plan to seek bankruptcy protection within three working days of such action by Contractor.

Section 11.06 Performance Malfeasance. Contractor shall report to the contract manager assigned to the Contract any knowledge of debarment, suspected fraud or unlawful activity related to performance under this Contract. Contractor shall make such report no later than three working days from the date that Contractor has

http://www.dshs.state.tx.us/childabusereporting


knowledge or reason to believe such activity has taken place. Additionally, if this Contract is federally funded by the Department of Health and Human Services (HHS), Contractor shall report any credible evidence that a principal, employee, subcontractor or agent of Contractor, or any other person, has submitted a false claim under the False Claims Act (31 U.S.C. §§3729-3733) or has committed a criminal or civil violation of laws pertaining to fraud, conflict of interest, bribery, gratuity, or similar misconduct involving those funds. Contractor shall make this report to the SAO at http://sao.fraud.state.tx.us, and to the HHS Office of Inspector General at http://www.oig.hhs.gov/fraud/hotline/ no later than three working days from the date that Contractor has knowledge or reason to believe such activity has taken place.

Section 11.07 Criminal Activity and Disciplinary Action.

a. Contractor affirms that Contract nor any no person who has an ownership or controlling interest in the

organization or who is an agent or managing employee of the organization has been placed on community supervision, received deferred adjudication, is presently indicted for or has been convicted of a criminal offense related to any financial matter, federal or state program or felony sex crime.

b. Contractor shall report in writing the contract manager assigned to the Contract, no later than three

working days from the date that Contractor has knowledge or reason to believe such activity has taken place, if it has reason to believe Contractor, or a person with ownership or controlling interest in the organization or who is an agent or managing employee of the organization, an employee or volunteer of Contractor, or a subcontractor providing services under this Contract has engaged in any activity that:

1. Would constitute a criminal offense equal to or greater than a Class A misdemeanor; 2. Reasonably would constitute grounds for disciplinary action by a state or federal regulatory

authority;

c. Has been placed on community supervision, received deferred adjudication, or been indicted for or convicted of a criminal offense relating to involvement in any financial matter, federal or state program or felony sex crime. Contractor shall not permit any person who engaged, or was alleged to have engaged, in any activity subject to reporting under this section to perform direct client services or have direct contact with clients, unless otherwise directed in writing by DSHS.

Section 11.08 Retaliation Prohibited. Contractor shall not retaliate against any person who reports a violation of, or cooperates with an investigation regarding, any applicable law, rule, regulation or standard to the Department, another state agency, or any federal, state or local law enforcement official.

Section 11.09 Documentation. Contractor shall maintain appropriate documentation of all notices and reporting to DSHS as required under these General Provisions or this Contract.

ARTICLE XII ASSURANCES AND CERTIFICATIONS

Section 12.01 Certification. Contractor certifies by execution of this Contract to the following and will include such in all of its subcontracts:

a. It is not disqualified under 2 CFR § 376.935 or ineligible for participation in federal or state assistance

programs; b. Neither it, nor its principals, are presently debarred, suspended, proposed for debarment, declared

ineligible, or voluntarily excluded from participation in this transaction by any federal or state department or agency in accordance with 2 CFR Parts 376 and 180 (parts A-I), 45 CFR Part 76 (or comparable federal regulations);

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c. It has not knowingly failed to pay a single substantial debt or a number of outstanding debts to a federal or state agency;

d. It is not subject to an outstanding judgment in a suit against Contractor for collection of the balance of a debt;

e. It is in good standing with all state and/or federal agencies that have a contracting or regulatory relationship with Contractor;

f. That no person who has an ownership or controlling interest in Contractor or who is an agent or managing employee of Contractor has been convicted of a criminal offense related to involvement in any program established under Medicare, Medicaid, or a federal block grant;

g. Neither it, nor its principals have within the three year period preceding this Contract, has been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a private or public (federal, state or local) transaction or contract under a private or public transaction, violation of federal or state antitrust statutes (including those proscribing price-fixing between competitors, allocation of customers between competitors and bid-rigging), or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or false claims, tax evasion, obstruction of justice, receiving stolen property or any other offense indicating a lack of business integrity or business honesty that seriously and directly affects the present responsibility of Contactor or its principals;

h. Neither it, nor its principals is presently indicted or otherwise criminally or civilly charged by a governmental entity (federal, state or local) with the commission of any of the offenses in subsection (g) above; and

i. Neither it, nor its principals within a three year period preceding this Contract has had one or more public transaction (federal, state or local) terminated for cause or default.

Where Contractor is unable to certify to any of the statements in this Article, Contractor shall submit an explanation to the contract manager assigned to the Contract. Also, if Contractor’s status with respect to the items certified in this Article changes during the term of this Contract, Contractor shall immediately notify the contract manager assigned to the Contract.

Section 12.02 Child Support Delinquencies. As required by Texas Family Code § 231.006, a child support obligor who is more than 30 calendar days delinquent in paying child support and a business entity in which the obligor is a sole proprietor, partner, shareholder or owner with an ownership interest of at least 25% is not eligible to receive payments from state funds under a contract to provide property materials, or services or receive a state- funded grant or loan. If applicable, Contractor shall maintain its eligibility to receive payments under this Contract, certifies that it is not ineligible to receive the payments specified in this Contract and acknowledges that this Contract may be terminated and payment may be withheld if this certification is inaccurate.

Section 12.03 Authorization. Contractor certifies that it possesses legal authority to contract for the services described in this Contract and if applicable, a resolution, motion or similar action has been duly adopted or passed as an official act of Contractor’s governing body, authorizing the binding of the organization under this Contract including all understandings and assurances contained in this Contract, and directing and authorizing the person identified as the authorized representative of Contractor to act in connection with this Contract and to provide such additional information as may be required.

Section 12.04 Gifts and Benefits Prohibited. Contractor certifies that it has not given, offered to give, nor intends to give at any time hereafter, any economic opportunity, present or future employment, gift, loan, gratuity, special discount, trip, favor, service or anything of monetary value to a DSHS or HHSC official or employee in connection with this Contract.

Section 12.05 Ineligibility to Receive the Contract.


a. Pursuant to Texas Government Code § 2155.004 and federal law, Contractor is ineligible to enter into this Contract with the Department if this Contract includes financial participation by a person who received compensation from DSHS to participate in developing, drafting or preparing the specifications, requirements, statement of work or Solicitation Document on which this Contract is based. Contractor certifies that neither Contractor nor its employees nor anyone acting for Contractor has received compensation from DSHS for participation in the developing, drafting or preparation of specifications, requirements or statements of work for this Contract or in the Solicitation Document associated with this Contract.

b. Pursuant to Texas Government Code §§ 2155.006 and 2261.053, Contractor is ineligible to enter into

this Contract, if Contractor or any person who would have financial participation in this Contract has been convicted of violating federal law or been assessed a federal civil or administrative penalty, in connection with a contract awarded by the federal government for relief, recovery or reconstruction efforts as a result of Hurricanes Rita or Katrina or any other disaster occurring after September 24, 2005.

c. Contractor certifies that the individual or business entity named in this Contract is not ineligible to

receive the specified Contract under Texas Government Code §§ 2155.004, 2155.006 or 2261.053 and acknowledges that this Contract may be terminated and payment withheld if these certifications are inaccurate.

Section 12.06 Antitrust. Pursuant to 15 USC Sec. 1, et seq., and Texas Business & Commerce Code § 15.01, et seq. Contractor certifies that neither Contractor nor anyone acting for Contractor has violated the antitrust laws of this state or federal antitrust laws nor communicated directly or indirectly regarding a bid made to any competitor or any other person engaged in Contractor’s line of business for the purpose of substantially lessening competition in such line of business.

ARTICLE XIII GENERAL BUSINESS OPERATIONS OF CONTRACTOR

Section 13.01 Program Site. Contractor shall provide services only in locations that are in compliance with all applicable local, state and federal zoning, building, health, fire and safety standards.

Section 13.02 Historically Underutilized Businesses (HUBs). If Contractor was not required to submit a HUB subcontracting plan and if subcontracting is permitted under this Contract, Contractor is encouraged to make a good faith effort to consider subcontracting with HUBs in accordance with Texas Government Code Chapter 2161 and 34 TAC § 20.14 et seq. Contractors may obtain a list of HUBs at http://www.window.state.tx.us/procurement/prog/hub. If Contractor has filed a HUB subcontracting plan, the plan is incorporated by reference in this Contract. If Contractor desires to make a change in the plan, Contractor must obtain prior approval of the revised plan from the Department’s HUB Coordinator before proposed changes shall be effective under this Contract.

Contractor shall make a good faith effort to subcontract with HUBs during the performance of this Contract and shall report HUB subcontract activity to the Department’s HUB Coordinator by the 15th day of each month for the prior month’s activity, if there was any such activity in accordance with 34 TAC § 20.16(c).

Section 13.03 Buy Texas. Contractor shall purchase products and materials produced in Texas when the products and materials are available at a price and time comparable to products and materials produced outside of Texas as required by Texas Government Code § 2155.4441.

Section 13.04 Status of Subcontractors. Contractor shall require that all subcontractors certify that they

http://www.window.state.tx.us/procurement/prog/hub


are/have:

a. In good standing with all state and federal funding and regulatory agencies; b. Not currently debarred, suspended or otherwise excluded from participation in federal grant programs; c. Not delinquent on any repayment agreements; d. Not had a required license or certification revoked; e. Not ineligible under the following sections of these General Provisions: Ineligibility to Receive the

Contract (Assurances and Certifications Article) or the Conflict of Interest or Transactions Between Related Parties sections (General Terms Article); and

f. Not had a contract terminated by the Department. Contractors shall further require that subcontractors certify that they have not voluntarily surrendered within the past three years any license issued by the Department.

Section 13.05 Independent Contractor. Contractor is an independent contractor. Contractor shall direct and be responsible for the performance of its employees, subcontractors, joint venture participants or agents. Contractor is not an agent or employee of the Department or the State of Texas for any purpose whatsoever. For purposes of this Contract, Contractor acknowledges that its employees, subcontractors, joint venture participants or agents shall not be eligible for unemployment compensation from the Department or the State of Texas.

Section 13.06 Tax Liability. Contractor shall comply with all state and federal tax laws and is solely responsible for filing all required state and federal tax forms and making all tax payments. If the Department discovers that Contractor has a liability or has failed to remain current on a delinquent liability to the IRS, this Contract shall be subject to remedies and sanctions under this Contract, including immediate termination at the Department’s discretion. If the Contract is terminated under this section, the Department shall not enter into a contract with Contractor for three years from the date of termination.

Section 13.07 Notice of Organizational Change. Contractor shall submit written notice to the contract manager assigned to the Contract within 10 business days of any change to Contractor's name, contact information, key personnel, organizational structure, such as merger, acquisition or change in form of business, legal standing or authority to do business in Texas.

A change in Contractor’s name and certain changes in organizational structure require an amendment to this Contract in accordance with the amendment provisions in Article XIII.

Section 13.08 No Endorsement. Other than stating the fact that Contractor has a contract with DSHS, Contractor and its subcontractors are prohibited from publicizing the contractual relationship between Contractor and DSHS and from using the Department’s name, logo or website link in any manner that is intended or that could be perceived as an endorsement or sponsorship by DSHS or the State of Texas of Contractor’s organization, program, services or product, without the express written consent of DSHS.

Section 13.09 E-Verify System. By entering into this Contract, the Contractor certifies and ensures that it utilizes and will continue to utilize, for the term of this Contract, the U.S. Department of Homeland Security’s E- Verify system to determine the eligibility of:

a. All persons employed to perform duties within Texas, during the term of the Contract; and b. All persons (including subcontractors) assigned by the Contractor to perform work pursuant to the

Contract, within the United States of America.

ARTICLE XIV GENERAL TERMS

Section 14.01 Assignment. Contractor shall not transfer, assign, or sell its interest, in whole or in part, in this


Contract without the prior written consent of the Department.

Section 14.02 Lobbying.

a. Contractor shall comply with Texas Government Code § 556.0055, which prohibits contractors who receive state funds from using those funds to pay lobbying expenses. Further, Contractor shall not use funds paid under this Contract, either directly or indirectly, to support the enactment, repeal, modification, or adoption of any law, regulation or policy at any level of government, or to pay the salary or expenses of any person related to any activity designed to influence legislation, regulation, policy or appropriations pending before Congress or the state legislature, or for influencing or attempting to influence an officer or employee of any federal or state agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with the awarding of any contract or the extension, continuation, renewal, amendment, or modification of any contract (31 USC § 1352).

b. If at any time this Contract exceeds $100,000 of federal funds, Contractor shall file with the contract

manager assigned to the Contract a declaration containing the name of any registrant under the Lobbying Disclosure Act of 1995 who has made lobbying contacts on behalf of Contractor in connection with this Contract, a certification that none of the funds provided by Department have been or shall be used for payment to lobbyists, and disclosure of the names of any and all registered lobbyists with whom Contractor has an agreement.

c. Contractor shall file the declaration, certification, and disclosure:

1. At the time of application for this Contract; 2. Upon execution of this Contract unless Contractor previously filed a declaration, certification, or

disclosure form in connection with the award; and 3. At the end of each calendar quarter in which any event occurs that materially affects the accuracy of

the information contained in any declaration, certification, or disclosure previously filed. Contractor shall require any person who requests or receives a subcontract to file the same declaration, certification, and disclosure with the contract manager assigned to the Contract. Contractor shall include this provision in any subcontracts.

Section 14.03 Conflict of Interest. Contractor represents to the Department that it and its subcontractors, if any, do not have, nor shall Contractor or its subcontractors knowingly acquire or retain any financial or other interest that would conflict in any manner with the performance of their obligations under this Contract. Potential conflicts of interest include, but are not limited to, an existing or potential business or personal relationship between Contractor (or subcontractor), its principal (or a member of the principal’s immediate family) or any affiliate or subcontractor and Department or HHSC, their commissioners, officers or employees, or any other entity or person involved in any way in any project that is the subject of this Contract.

Contractor shall establish safeguards to prohibit employees and subcontractors and their employees from using their positions for a purpose that constitutes or presents the appearance of personal or organizational conflict of interest or personal gain.

If, at any time during the term of this Contract, Contractor or any of its subcontractors has a conflict of interest or potential conflict of interest, Contractor shall disclose the actual or potential conflict of interest to the contract manager assigned to the Contract within 10 days of when Contractor becomes aware of the existence of the actual or potential conflict of interest. Contractor shall require each of its subcontractors to report to Contractor any conflict of interest or potential conflict of interest the subcontractor has or may have within 10 days of when the subcontractor becomes aware of the actual or potential conflict of interest.


Section 14.04 Transactions Between Related Parties. Contractor shall identify and report to DSHS any transaction between Contractor and a related party that is part of the work that the Department is purchasing under this Contract before entering into the transaction or immediately upon discovery. A related party is a person or entity related to Contractor by blood or marriage, common ownership or any association that permits either to significantly influence or direct the actions or policies of the other. Contractor, for purposes of reporting transactions between related parties, includes the entity contracting with the Department under this Contract as well as the chief executive officer, chief financial officer and program director of Contractor.

Contractor shall submit to the contract manager assigned to the Contract the name, address and telephone number of the related party, how the party is related to Contractor and the work the related party shall perform under this Contract.

Contractor shall comply with Texas Government Code Chapter 573.

Contractor shall maintain records and supply any additional information requested by the Department, regarding a transaction between related parties, needed to enable the Department to determine the appropriateness of the transaction pursuant to applicable state or federal law, regulations or circulars, which may include 45 CFR § 74.42.

Section 14.05 Intellectual Property.

a. Texas Health and Safety Code §12.020 authorizes DSHS to protect intellectual property developed as a

result of this Contract. “Intellectual property” is created property that may be protected under copyright, patent, or trademark/service mark law.

b. For purposes of this Contract, intellectual property prepared for DSHS use, or a work specially ordered

or commissioned through a contract for DSHS use is a “work made for hire.” DSHS owns works made for hire unless it agrees otherwise by contract. To the extent that title and interest to any such work may not, by operation of law, vest in DSHS, or such work may not be considered a work made for hire, Contractor irrevocably assigns the rights, title and interest therein to DSHS.

c. DSHS has the right to obtain and hold in its name any and all patents, copyrights, registrations or other

such protections as may be appropriate to the subject matter, and any extensions and renewals thereof. Contractor shall give DSHS and the State of Texas, as well as any person designated by DSHS and the State of Texas, all assistance required to perfect the rights defined herein without charge or expense beyond those amounts payable to Contractor for goods provided or services rendered under this Contract.

If federal funds are used to finance activities supported by this Contract that result in the production of intellectual property, the federal awarding agency reserves a royalty-free, nonexclusive, and irrevocable license to reproduce, publish, or otherwise use, and to authorize others to use, for federal government purposes:

1. Copyright in any intellectual property developed under this Contract including any subcontract; and 2. Any rights of copyright to which a Contractor purchases ownership with contract funds.

d. Any rights of copyright, service or trademarks or patents to which a grantee, subgrantee or a Contractor

purchases ownership with contract funds


e. If the results of the contract performance are subject to copyright law, Contractor cannot publish those results without prior review and approval of DSHS. Contractor shall submit requests for review and approval to the contract manager assigned to the Contract.

Section 14.06 Other Intangible Property. At the conclusion of the contractual relationship between Department and Contractor, for any reason, Department shall have the sole ownership rights and interest in all non-copyrightable intangible property that was developed, produced or obtained by Contractor as a specific requirement under this Contract or under any grant that funds this Contract, such as domain names, URLs or software licenses with a value of $500 or more. Contractor shall cooperate with Department and perform all actions necessary to transfer ownership of such property to the Department or its designee, or otherwise affirm Department’s ownership rights and interest in such property. This provision shall survive the termination or expiration of this Contract.

Section 14.07 Severability and Ambiguity. If any provision of this Contract is construed to be illegal or invalid, the illegal or invalid provision shall be deemed stricken and deleted to the same extent and effect as if never incorporated, but all other provisions shall continue. The Parties represent and agree that the language contained in this Contract is to be construed as jointly drafted, proposed and accepted.

Section 14.08 Legal Notice. Except as otherwise provided in this Contract or General Provisions, any notice required or permitted to be given by the provisions of this Contract or General Provisions shall be deemed to have been received by a Party on the third business day after the date on which it was mailed to the Party at the address specified by the Party to the other Party in writing or, if sent by certified mail, on the date of receipt.

Section 14.09 Successors. This Contract shall be binding upon the Parties and their successors and assignees, except as expressly provided in this Contract.

Section 14.10 Survivability of Terms. Termination or expiration of this Contract or a Contract for any reason shall not release either party from any liabilities or obligations in this Contract that the parties have expressly agreed shall survive any such termination or expiration or remain to be performed, including but not limited to maintaining confidentiality of information and records retention.

Section 14.11 Customer Service Information. If requested, Contractor shall supply such information as required by the Department to comply with the provisions of Texas Government Code Chapter 2114 regarding Customer Service surveys.

Section 14.12 Amendment. All amendments to this Contract must be in writing and agreed to by both Parties. If a Contractor requests an amendment, it must be submitted in writing and include a justification for the request, to the contract manager assigned to the Contract.

Section 14.13 Contractor’s Notification of Change of Contact Person or Key Personnel. Within ten calendar days shall notify in writing the contract manager assigned to the Contract of any change enumerated in the Contractor’s Contact Personnel or Key Personnel, if included in their response to a solicitation document.

Section 14.14 Unilateral Amendment. The Department reserves the right to amend this Contract through execution of a unilateral amendment signed by the contract manager for this Contract and provided to the Contractor with ten days notice prior to execution of the amendment under the following circumstances to:

a. Correct an obvious clerical error in this Contract; b. Incorporate new or revised federal or state laws, regulations, rules or policies; and


c. Change the name of the Contractor in order to reflect the Contractor's name as recorded by the Texas Secretary of State.

Section 14.15 Interim Extension Amendment.

a. Prior to or on the expiration date of this Contract, the Parties agree that this Contract can be extended as

provided under this Section.

b. DSHS/HHSC shall provide written notice of interim extension amendment to the Contractor under one of the following circumstances:

1. Continue provision of services in response to a disaster declared by the governor; or 2. To ensure that services are provided to clients without interruption.

c. DSHS will provide written notice of the interim extension amendment that specifies the reason for it and

period of time for the extension.

d. Contractor will provide and invoice for services in the same manner that is stated in the Contract.

e. An interim extension under Section (b)(1) above shall extend the term of the contract not longer than 30 days after governor's disaster declaration is declared unless the Parties agree to a shorter period of time.

f. An interim extension under Section (b)(2) above shall be a one-time extension for a period of time

determined by HHS/DSHS.

Section 14.16 Immunity Not Waived. THE PARTIES EXPRESSLY AGREE THAT NO PROVISION OF THIS CONTRACT IS IN ANY WAY INTENDED TO CONSTITUTE A WAIVER BY DEPARTMENT OR THE STATE OF TEXAS OF ANY IMMUNITIES FROM SUIT OR FROM LIABILITY THAT DEPARTMENT OR THE STATE OF TEXAS MAY HAVE BY OPERATION OF LAW.

Section 14.17 Hold Harmless and Indemnification. Contractor, as an independent contractor, agrees to hold Department, the State of Texas, individual state employees and officers, and the federal government harmless and to indemnify them from any and all liability, suits, claims, losses, damages and judgments, and to pay all costs, fees, and damages to the extent that such costs, fees, and damages arise from performance or nonperformance of Contractor, its employees, subcontractors, joint venture participants or agents under this Contract.

Section 14.18 Waiver. Acceptance by either Party of partial performance or failure to complain of any action, non-action or default under this Contract shall not constitute a waiver of either party’s rights under this Contract.

Section 14.19 Electronic and Information Resources Accessibility and Security Standards.

a. Applicability.

The following Electronic and Information Resources (EIR) requirements apply to the Contract because the Contractor performs services that include EIR that DSHS employees are required or permitted to access or members of the public are required or permitted to access.

This Section does not apply to incidental uses of EIR in the performance of the Agreement, unless the Parties agree that the EIR will become property of the State of Texas or will be used by HHSC’s clients or recipients after completion of the Agreement.


Nothing in this section is intended to prescribe the use of particular designs or technologies or to prevent the use of alternative technologies, provided they result in substantially equivalent or greater access to and use of a Product.

b. Definitions. For purposes of this Section:

“Accessibility Standards” means accessibility standards and specifications for Texas agency and institution of higher education websites and EIR set forth in 1 TAC Chapter 206 and/or Chapter 213.

“Electronic and Information Resources” means information resources, including information resources technologies, and any equipment or interconnected system of equipment that is used in the creation, conversion, duplication, or delivery of data or information. The term includes telephones and other telecommunications products, information kiosks, transaction machines, Internet websites, multimedia resources, and office equipment, including copy machines and fax machines.

“Electronic and Information Resources Accessibility Standards” means the accessibility standards for electronic and information resources contained in 1 Texas Administrative Code Chapter 213.

“Product” means information resources technology that is, or is related to, EIR.

“Web Site Accessibility Standards/ Specifications” means standards contained in Volume 1 Tex. Admin. Code Chapter 206(c) Accessibility Requirements.

Under Tex. Gov’t Code Chapter 2054, Subchapter M, and implementing rules of the Texas Department of Information Resources, DSHS must procure Products and services that comply with the Accessibility Standards when those Products are available in the commercial marketplace or when those Products are developed in response to a procurement solicitation. Accordingly, Contractor must provide electronic and information resources and associated Product documentation and technical support that comply with the Accessibility Standards.

c. Evaluation, Testing, and Monitoring.

1. DSHS may review, test, evaluate and monitor Contractor’s Products and services, as well as associated documentation and technical support for compliance with the Accessibility Standards. Review, testing, evaluation and monitoring may be conducted before and after the award of a contract. Testing and monitoring may include user acceptance testing. Neither the review, testing (including acceptance testing), evaluation or monitoring of any Product or service, nor the absence of review, testing, evaluation or monitoring, will result in a waiver of the State’s right to contest the Contractor’s assertion of compliance with the Accessibility Standards.

2. Contractor agrees to cooperate fully and provide DSHS and its representatives timely access to

Products, records, and other items and information needed to conduct such review, evaluation, testing, and monitoring.

d. Representations and Warranties.

1. Contractor represents and warrants that:

i. As of the Effective Date of the Contract, the Products and associated documentation and technical support comply with the Accessibility Standards as they exist at the time of entering the Agreement, unless and to the extent the Parties otherwise expressly agree in writing; and


ii. If the Products will be in the custody of the state or a DSHS client or recipient after the Contract expiration or termination, the Products will continue to comply with Accessibility Standards after the expiration or termination of the Contract Term, unless DSHS or its clients or recipients, as applicable, use the Products in a manner that renders it noncompliant.

2. In the event Contractor becomes aware, or is notified that the Product or service and associated documentation and technical support do not comply with the Accessibility Standards, Contractor represents and warrants that it will, in a timely manner and at no cost to DSHS, perform all necessary steps to satisfy the Accessibility Standards, including remediation, replacement, and upgrading of the Product or service, or providing a suitable substitute.

3. Contractor acknowledges and agrees that these representations and warranties are essential

inducements on which DSHS relies in awarding this Contract.

4. Contractor’s representations and warranties under this subsection will survive the termination or expiration of the Contract and will remain in full force and effect throughout the useful life of the Product.

e. Remedies.

1. Under Tex. Gov’t Code § 2054.465, neither the Contractor nor any other person has cause of action against DSHS for a claim of a failure to comply with Tex. Gov’t Code Chapter 2054, Subchapter M, and rules of the Department of Information Resources.

2. In the event of a breach of Contractor’s representations and warranties, Contractor will be liable for

direct, consequential, indirect, special, or liquidated damages and any other remedies to which DSHS may be entitled under this Contract and other applicable law. This remedy is cumulative of any other remedies to which DSHS may be entitled under this Contract and other applicable law.

Section 14.20 Force Majeure. Neither Party shall be liable for any failure or delay in performing all or some of its obligations, as applicable, under this Contract if such failure or delay is due to any cause beyond the reasonable control of such Party, including, but not limited to, extraordinarily severe weather, strikes, natural disasters, fire, civil disturbance, epidemic, war, court order or acts of God. The existence of any such cause of delay or failure shall extend the period of performance in the exercise of reasonable diligence until after the cause of the delay or failure no longer exists and, if applicable, for any reasonable period of time thereafter required to resume performance. A Party, within a period of time reasonable under the circumstances, must inform the other party as soon as practicable. This Party must also submit written notice with proof of receipt of the existence of a force majeure event or otherwise waive the right as a defense to non-performance.

Section 14.21 Cooperation and Communication. Contractor shall cooperate with Department staff and as applicable, other DSHS contractors and shall promptly comply with requests from DSHS for information or responses to DSHS inquiries concerning Contractor’s duties or responsibilities under this Contract.

Section 14.22 Insurance. Contractor shall acquire and maintain for the duration of this Contract, insurance and with financially sound and reputable insurers licensed by the Texas Department of Insurance, in the type and amount customarily carried within the Contractor’s industry or profession. Contractor must submit evidence of insurance as required under this Contract, including if requested a schedule of coverage or “underwriter’s schedules” establishing to the satisfaction of DSHS the nature and extent of coverage granted by each such policy upon request by DSHS. In the event that any policy is determined to be deficient to comply with the terms of this Contract, Contractor shall


secure such additional policies or coverage as DSHS may reasonably request or that are required by law or regulation.

ARTICLE XV BREACH OF CONTRACT AND REMEDIES FOR NON-COMPLIANCE

Section 15.01 Actions Constituting Breach of Contract. Actions or inactions that constitute breach of contract include, but are not limited to, the following:

a. Failure to properly provide the services and/or goods purchased under this Contract; b. Failure to comply with any provision of this Contract including failure to comply with all applicable

statutes, rules or regulations; c. Failure to pay refunds or penalties owed to the Department; d. Failure to comply with a repayment agreement with Department or agreed order issued by the

Department; e. Discovery of a material misrepresentation in any aspect of Contractor’s application or response to the

Solicitation Document; f. Any misrepresentation in the assurances and certifications in Contractor’s application or response to the

Solicitation Document or in this Contract; or g. Contractor is on or is added to the Excluded Parties List System (EPLS).

Section 15.02 General Remedies and Sanctions. The remedies and sanctions in this section are available to the Department against Contractor and any entity that subcontracts with Contractor for provision of services or goods.

Additionally, HHSC OIG may investigate, audit and impose or recommend imposition of remedies or sanctions to Department for any breach of this Contract.

The Department may impose one or more remedies or sanctions for each item of noncompliance and shall determine remedies or sanctions on a case-by-case basis if Contractor breaches this Contract by failing to comply with one or more of the terms of this Contract, including but not limited to compliance with applicable statutes, rules or regulations, the Department may take one or more of the following actions:

a. Terminate this Contract by one of means provided in Article XVII. If applicable, notify Contractor of

the opportunity to request a hearing on the termination pursuant to Texas Government Code Chapter 2105 regarding administration of Block Grants;

b. Suspend all or part of this Contract by notifying that the Contractor that DSHS is temporarily discontinue performance of all or a part of the Contract as provided for in Article XVII; as of the effective date of the suspension pending DSHS’s determination to terminate, amend the Contract or permit the Contractor to resume performance. Contractor shall not bill DSHS for services performed during suspension, unless expressly authorized by the notice of suspension;

c. Use as a basis to deny additional or enter into future contracts with Contractor; d. Temporarily withhold cash payments to Contractor for proper charges or pending resolution of issues of

noncompliance with conditions of this Contract or indebtedness to the United States or to the State of Texas;

e. Permanently withhold cash payments by retaining funds billed by Contractor; f. Request that Contractor be removed from the Centralized Master Bidders List (CMBL) or any other

state bid list, and barred from participating in future contracting opportunities with the State of Texas; g. Declare this Contract void upon the Department’s determination that this Contract was obtained

Fraudulently, or was illegal or invalid from this Contract’s inception and demand repayment of any funds under this Contract;


h. Delay execution of a new contract or renewal with Contractor while other imposed or proposed sanctions are pending resolution;

i. Demand repayment from Contractor when it has been verified that Contractor has been overpaid for reasons such as payments are not supported by proper documentation or failure to comply with Contract terms;

j. Pursue a claim for damages as a result of breach of contract; k. Require Contractor to prohibit any employee or volunteer of Contractor from performing under this

Contract or having direct contact with DSHS-funded clients or participant, if the employee or volunteer has been indicted or convicted of the misuse of state or federal funds, fraud or illegal acts that are in contraindication to continued obligations under this Contract, as reasonably determined by DSHS;

l. Withhold any payment to Contractor to satisfy any recoupment imposed by DSHS and take repayment from funds available under this Contract in amounts necessary to fulfill Contractor’s payment or repayment obligations;

m. Reduce the Contract term; n. Recoup improper payments when Contractor has been overpaid for reasons such as payments are not

supported by proper documentation, improper billing or failure to comply with Contract terms; and o. Impose any other remedies, sanctions or penalties permitted by federal or state statute, law, regulation or

rule.

Section 15.03 Notice of Remedies or Sanctions.

a. Department shall formally notify Contractor in writing when a remedy or sanction is imposed, stating the nature of the remedies and sanction, the reasons for imposing them, the corrective actions, if any, that must be taken before the actions shall be removed and the time allowed for completing the corrective actions, and the method, if any, of requesting reconsideration of the remedies or sanctions imposed.

b. Other than in the case of repayment or recoupment, Contractor is required to file, within 15 calendar

days of receipt of notice, a written response to Department acknowledging receipt of such notice.

c. If requested by the Department, the written response must state how Contractor shall correct the noncompliance by agreeing to a corrective action plan or demonstrate in writing that the findings on which the remedies or sanctions are based are either invalid or do not warrant the remedies or sanctions. If Department determines that a remedy or sanction is warranted, unless the remedy or sanction is subject to review under a federal or state statute, regulation, rule, or guideline, Department’s decision is final. Department shall provide written notice to Contractor of Department’s final decision.

d. If required by the Department, Contractor shall submit a corrective action plan for DSHS approval and

take corrective action as stated in the plan approved by DSHS. If DSHS determines that repayment is warranted, DSHS shall issue a demand letter to Contractor for repayment. If full repayment is not received within the time limit stated in the demand letter, and if recoupment is available, DSHS shall recoup the amount due to DSHS from funds otherwise due to Contractor under this Contract.

Section 15.04 Emergency Action. In an emergency, Department may immediately terminate or suspend all or part of this Contract, temporarily or permanently withhold cash payments, deny future contract awards, or delay contract execution by delivering written notice to Contractor, by any verifiable method, stating the reason for the emergency action. An “emergency” is defined as Contractor is noncompliant and the noncompliance has a direct adverse effect on the public or client health, welfare or safety. The direct adverse effect may be programmatic and may include failing to provide services; providing inadequate services; or providing unnecessary services.


Whether Contractor’s conduct or noncompliance is an emergency will be determined by Department on a case- by-case basis and will be based upon the nature of the noncompliance or conduct.

ARTICLE XVI CLAIMS AGAINST THE DEPARTMENT-NOTICE OF DISPUTE

Section 16.01 Breach of Contract Claim. The process for a breach of contract claim against the DSHS provided for in Texas Government Code Chapter 2260 and implemented in the rules at 25 TAC §§4.11-4.24 or as amended by DSHS, shall be used by DSHS and Contractor to attempt to resolve any breach of contract claim against DSHS.

Section 16.02 Notice. Contractor’s claims for breach of this Contract that the Parties cannot resolve in the ordinary course of business must be submitted to the negotiation process provided in Chapter 2260 and 25 TAC or as amended. To initiate the process, Contractor shall submit written notice, as required by Subchapter B, to DSHS Office of General Counsel. The notice must specifically state that the provisions of Chapter 2260 are being invoked and comply with all the requirements in this Chapter and TAC. A copy of the notice must also be given to all other representatives of DSHS and Contractor.

Section 16.03 Performance Not Suspended. Neither the occurrence of an event nor the pendency of a notice of claim filed by the Contractor constitutes grounds for the suspension in whole or part of performance by Contractor.

ARTICLE XVII TERMINATION AND TEMPORARY SUSPENSION

Section 17.01 Expiration of Contract or Program Attachments.

a. Except as provided in the Survivability of Terms section of the General Terms Article, Contractor’s

service obligations stated in each Contract or Program Attachment shall end upon the expiration date of that Contract or Program Attachment unless extended or renewed by written amendment.

b. Prior to completion of the term of all Contracts or Program Attachments, all or a part of this Contract

may be terminated with or without cause under this Article and in the Contract.

c. A Program Attachment’s term cannot extend past the Contract term in its associated Contract.

Section 17.02 Effect of Termination or Expiration.

a. Upon termination of this Contract or Program Attachment, as applicable, Contractor shall cooperate with DSHS to the fullest extent possible to ensure the orderly and safe transfer of responsibilities under this Contract or Program Attachment, as applicable to DSHS or another entity designated by DSHS.

b. Upon termination of all or part of this Contract, Department and Contractor shall be discharged from

any further obligation created under the applicable terms of this Contract or Program Attachment, as applicable, except for the equitable settlement of the respective accrued interests or obligations incurred prior to termination and for Contractor’s duty to cooperate with DSHS and, except as provided in the Survivability of Terms section of the General Terms Article.

c. Termination does not, however, constitute a waiver of any remedies for breach of this Contract.

Section 17.03 Termination or Temporary Suspension Without Cause.


a. Either Party may terminate this Contract or Program Attachment, as applicable with at least 30 calendar days prior written notice to the nonterminating Party.

b. If Contractor seeks to terminate a Contract that involves residential client services, Contractor shall give

the Department at least 90 calendar days prior written notice and shall submit a transition plan to ensure client services are not disrupted.

c. The Parties can agree to terminate by mutual agreement.

DSHS may temporarily suspend or terminate this Contract or Program Attachment, as applicable if funds become unavailable through lack of appropriations, budget cuts, transfer of funds between programs or HHSC agencies, amendments to the Appropriations Act, health and human services consolidations or any other disruption of current appropriated funding for this Contractor Program Attachment. Contractor shall be notified in writing of any termination or temporary suspension and of any cessation of temporary suspension. Upon notification of temporary suspension, Contractor will discontinue performance under the Contract as of the effective date of the suspension for the duration of the suspension.

Section 17.04 Immediate Termination. Department may immediately terminate this Contract or Program Attachment, as applicable, when, in the sole determination of Department, termination is in the best interest of the State of Texas.

Section 17.05 Termination For Cause. Department may terminate this Contract, in whole or in part, for breach of contract by providing 10 calendar days written notice to Contractor.

Section 17.06 Notice of Termination. Either Party may deliver written notice of intent to terminate by any verifiable method. Notice of termination is effective when it is received by the non-terminating party.

ARTICLE XVIII VOID, SUSPENDED AND TERMINATED CONTRACTS

Section 18.01 Void Contracts. Department may void this Contract upon determination that the award was obtained fraudulently or was otherwise illegal or invalid from its inception.

Section 18.02 Effect of Void, Suspended, or Involuntarily Terminated Contract. A Contractor who has been a party to a contract with DSHS that has been found to be void, is suspended or is terminated for cause is not eligible for any renewal or increase of funding for an existing contract or new contracts or renewals until in the case of suspension or termination the Department has determined that Contractor has satisfactorily resolved the issues underlying the suspension or termination. Additionally, if this Contract is found to be void any amount paid to the Contractor is subject to recoupment by DSHS.

Section 18.03 Appeals Rights for DSHS Funded Block Grants. Pursuant to Texas Government Code § 2105.302, after receiving notice from the Department of termination of a contract with DSHS funded by block grant funds, Contractor may request an administrative hearing under Texas Government Code Chapter 2001.

ARTICLE XIX CLOSEOUT

Section 19.01 Cessation of Services at Closeout. Upon expiration or termination of this Contract or Program Attachment, as applicable, Contractor shall stop providing services or the delivery of goods under this Contract and if necessary, shall cooperate with DSHS to the fullest extent possible to ensure the orderly and safe transfer of responsibilities under this Contract to DSHS or another entity designated by DSHS.


Contractor shall not bill DSHS for services performed or goods delivered after termination or expiration of Contract or Program Attachment.

Upon termination or expiration of this Contract or Program Attachment, Contractor shall immediately initiate Closeout activities described in this Article.

Section 19.02 Administrative Offset. The Department has the right to administratively offset amounts owed by Contractor against any invoice submitted for payment.

Section 19.03 Deadline for Closeout. Contractor shall submit all performance, and other Closeout reports required under this Contract within 45 calendar days after the Contract or Program Attachment, if applicable, has terminated.

Section 19.04 Payment of Refunds. Any funds paid to Contractor in excess of the amount to which Contractor is finally determined to be entitled under the terms of this Contract constitute a debt to the Department and shall result in a refund due, which Contractor shall pay within the time period established by the Department.

Section 19.05 Disallowances and Adjustments. The Closeout of this Contract or Program Attachment does not affect the Department’s right to recover funds on the basis of a later audit or other review or Contractor’s obligation to return any funds due as a result of later refunds, corrections or other transactions.

2016 FEDERAL GRANT SUBRECIPIENT ADDITIONAL PROVISIONS

ARTICLE XX DSHS GENERAL PROVISIONS ....................................................................................... 31

ARTICLE XXI PROGRAM OPERATIONS ...................................................................................................... 31

Section 21.01 Client Financial Eligibility. ....................................................................................................... 31 Section 21.02 Contracts with Subrecipient and Vendor Subcontractors. .................................................... 31 Section 21.03 Incorporation of Terms in Subrecipient Subcontracts. .......................................................... 31 Section 21.04 Quality Management. ................................................................................................................ 32 Section 21.05 Contractor’s Notification of Change to Certain Contract Provisions. .................................. 32 Section 21.06 Responsibilities and Restrictions Concerning Governing Body, Officers and Employees. .. 32 Section 21.07 Direct Operation. ...................................................................................................................... 33

ARTICLE XXII PROGRAM EQUIPMENT AND SUPPLIES .......................................................................... 33

Section 22.01 Equipment. ................................................................................................................................ 33 Section 22.02 Equipment List. ......................................................................................................................... 33 Section 22.03 Supplies. ..................................................................................................................................... 34 Section 22.04 Property Inventory and Protection of Assets. ......................................................................... 34 Section 22.05 Assets as Collateral Prohibited. ................................................................................................ 34

ARTICLE XXIII PROGRAM FUNDS AND PAYMENTS ................................................................................. 34

Section 23.01 Use of Funds................................................................................................................................ 34 Section 23.02 Use for Match Prohibited. ........................................................................................................ 34 Section 23.03 Program Income. ....................................................................................................................... 35 Section 23.04 Nonsupplanting. ........................................................................................................................ 35 Section 23.05 Payment Methods. ...................................................................................................................... 35 Section 23.06 Financial Status Reports (FSRs). ............................................................................................. 35 Section 23.07 Working Capital Advance. ....................................................................................................... 35 Section 23.08 Condition Precedent to Requesting Payment. ......................................................................... 36 Section 23.09 Management and Control Systems. ......................................................................................... 36 Section 23.10 Effect of Grant Close Out. ........................................................................................................ 36

ARTICLE XXIV ALLOWABLE COSTS AND AUDIT REQUIREMENTS .................................................... 36

Section 24.01 Allowable Costs. ........................................................................................................................ 36 Section 24.02 Property Acquisitions. ............................................................................................................... 37 Section 24.03 Cost Allocation Plan. ................................................................................................................. 38 Section 24.04 Overtime Compensation. .......................................................................................................... 38 Section 24.05 Independent Single or Program-Specific Audit. ..................................................................... 38 Section 24.06 Submission of Audit. ................................................................................................................. 39

ARTICLE XXV INSURANCE AND BONDS ....................................................................................................... 39

Section 25.01 Insurance. .................................................................................................................................. 39 Section 25.02 Fidelity Bond. ............................................................................................................................. 40 Section 25.03 Liability Coverage. .................................................................................................................... 40

ARTICLE XXVI TERMINATION, BANKRUPTCY AND CLOSEOUT ......................................................... 40

Section 26.01 Final Budget. .............................................................................................................................. 40 Section 26.02 Bankruptcy. ............................................................................................................................... 40 Section 26.03 Title to Property. ....................................................................................................................... 41 Section 26.04 Disposition of Property. ............................................................................................................ 41 Section 26.05 Closeout of Equipment. ............................................................................................................. 41

ARTICLE XXVII NON-EXCLUSIVE LIST OF APPLICABLE LAWS ........................................................... 41

Subrecipient General Provisions (September 1, 2015) 31

ARTICLE XX DSHS GENERAL PROVISIONS In addition to the terms and conditions in the Department of State Health Services (DSHS or Department) FY 2016 General Provisions (General Provisions), Contractor agrees to comply with these 2016 Federal Grant Subrecipient Additional Provisions.

ARTICLE XXI PROGRAM OPERATIONS

Section 21.01 Client Financial Eligibility. Where applicable, Contractor shall use financial eligibility criteria, financial assessment procedures and standards developed by the Department to determine client eligibility.

Section 21.02 Contracts with Subrecipient and Vendor Subcontractors.

a. Contractor may enter into contracts with subrecipient subcontractors unless restricted or otherwise prohibited in the Contract or Program Attachment(s).

b. Prior to entering into a subrecipient agreement equaling or exceeding $100,000, Contractor shall

obtain written approval from DSHS.

c. Contractor shall establish written policies and procedures for competitive procurement and monitoring of subcontracts and shall produce a subcontracting monitoring plan.

d. Contractor shall monitor subrecipient subcontractors for both financial and programmatic

performance and shall maintain pertinent records that must be available for inspection by DSHS.

e. Contractor shall ensure that subcontractors are fully aware of the requirements placed upon them by state/federal statutes, rules, and regulations and by the provisions of this Contract.

f. Contracts with all subcontractors, whether vendor or subrecipient, must be in writing and include

the following: 1. Name and address of all parties and the subcontractor’s Vendor Identification Number (VIN) or

Employee Identification Number (EIN); 2. Detailed description of the services to be provided; 3. Measurable method and rate of payment and total not-to-exceed amount of the contract; 4. Clearly defined and executable termination clause; and 5. Beginning and ending dates that coincide with the dates of the Contract.

g. Contractor is responsible to DSHS for the performance of any subcontractor.

h. Contractor shall not contract with a subcontractor, at any tier, that is debarred, suspended, or

excluded from or ineligible for participation in federal assistance programs or if the subcontractor would be ineligible under the Sections 12.05, 14.03 and 14.04 of the General Provisions.

Section 21.03 Incorporation of Terms in Subrecipient Subcontracts.

a. Contractor shall include in all its contracts with subrecipient subcontractors and solicitations for subrecipient subcontracts, without modification (except as required to make applicable to the subcontractor): 1. Assurances and Certifications in Article XII of the General Provisions; 2. Sections 14.03 and 14.04 of the General Provisions; and


3. A provision granting to DSHS, SAO, OIG, and the Comptroller General of the United States, and any of their representatives, the right of access to inspect the work and the premises on which any work is performed, and the right to audit the subcontractor in accordance with Article X of the General Provisions;

b. Each subrecipient subcontract contract must also include a copy of these General Provisions and a

copy of the Statement of Work and any other provisions in the Program Attachment(s) applicable to the subcontract.

c. Contractor shall ensure that all written agreements with subrecipient subcontractors incorporate the

terms of this Contract so that all terms, conditions, provisions, requirements, duties and liabilities under this Contract applicable to the services provided or activities conducted by a subcontractor are passed down to that subcontractor.

d. No provision of this Contract creates privity of contract between DSHS and any subcontractor of

Contractor.

e. If a subcontractor is unable to certify (or status changes during contract term) to any of the statements in Sections 14.03 and 14.04, or any of the certifications stated in Article XII of the General Provisions, Contractor shall submit an explanation to the contract manager assigned to the Contract.

Section 21.04 Quality Management. Contractor shall comply with quality management requirements as directed by the Department.

Section 21.05 Contractor’s Notification of Change to Certain Contract Provisions. The following changes may be made to this Contract without a written amendment or the Department’s prior approval:

a. Cumulative budget transfers that do not exceed 25% among direct cost categories, other than the equipment category, of less than $100,000, provided that the total budget amount is unchanged (This subsection does not apply to contracts funded by funding sources that have different percentage requirements); and

b. Change in Contractor’s share of the budget concerning non-DSHS funding other than program income and match, regardless of the amount of the change, provided that in changing the budget, Contractor is not supplanting DSHS funds.

Contractor within ten calendar days shall notify in writing the contract manager assigned to the Program Attachment of any change enumerated in this section, but the contract will not be amended.

Section 21.06 Responsibilities and Restrictions Concerning Governing Body, Officers and Employees.

a. Contractor and its governing body shall bear full responsibility for the integrity of the fiscal and programmatic management of the organization. This provision applies to all organizations, including Section 501(c) (3) organizations as defined in the Internal Revenue Service Code as not- for-profit organizations.

b. Each member of Contractor’s governing body shall be accountable for all funds and materials

received from Department. The responsibility of Contractor’s governing body shall also include accountability for compliance with Department Rules, policies, procedures, and applicable federal and state laws and regulations; and correction of fiscal and program deficiencies identified through


self-evaluation and Department’s monitoring processes. Contractor’s governing body shall ensure separation of powers, duties, and functions of governing body members and staff.

c. No member of Contractor’s governing body, or officer or employee of Contractor shall vote for,

confirm or act to influence the employment, compensation or change in status of any person related within the second degree of affinity or the third degree of consanguinity (as defined in Texas Government Code Chapter 573) to the member of the governing body or the officer or any employee authorized to employ or supervise such person. This prohibition does not prohibit the continued employment of a person who has been continuously employed for a period of two years prior to the election, appointment or employment of the officer, employee, or governing body member related to such person in the prohibited degree. These restrictions also apply to the governing body, officers and employees of Contractor’s subcontractors.

Section 21.07 Direct Operation. At the Department’s discretion, the Department may temporarily assume operations of a Contractor’s program or programs funded under this Contract when the continued operation of the program by Contractor puts at risk the health or safety of clients and/or participants served by Contractor.

ARTICLE XXII PROGRAM EQUIPMENT AND SUPPLIES

Section 22.01 Equipment. Equipment means tangible personal property having a useful lifetime of more than one year and a per-unit acquisition cost that exceeds the lesser of the capitalization level established by the of $5,000 or more. Contractors shall inventory all equipment, and report the inventory on the Contractors Property Inventory Form.

Contractor shall initiate the purchase of all equipment approved in writing by DSHS, in the first quarter of the Contract or Program Attachment term, as applicable. Failure to timely initiate the purchase of equipment may result in the loss of availability of funds for the purchase of equipment. Requests to purchase previously approved equipment after the first quarter in the Program Attachment must be submitted to the contract manager assigned to this Contract.

Section 22.02 Equipment List.

a. All items of equipment to be purchased with funds under this Contract must be itemized in Contractor’s equipment list as finally approved by the Department in the executed Contract. The equipment list must include: 1. Description of the property; 2. Serial number or other identification number; 3. Source of funding for the property (including the Federal Assistance Identification Number); 4. Who holds title, 5. Acquisition date and cost of the property; 6. Percentage of Federal participation in the project costs for the Federal award under which the

property was acquired; 7. Location use and condition of the property; and 8. Any ultimate disposition data including the date of disposal and sale price of property. Any

changes to the approved equipment list in the executed Contract must be approved in writing by Department prior to the purchase of equipment.

b. Contractor shall submit to the contract manager assigned to this Contact, a written description

including complete product specifications and need justification prior to purchasing any item of


unapproved equipment. If approved, Department will acknowledge its approval by means of a written amendment.

Section 22.03 Supplies.

a. Supplies are defined as consumable items necessary to carry out the services under this Contract including medical supplies, drugs, janitorial supplies, office supplies, patient educational supplies, software, and any items of tangible personal property other than those defined as equipment above.

b. Tangible personal property includes controlled assets, including firearms, regardless of the

acquisition cost, and the following assets with an acquisition cost of $500 or more, but less than $5,000, which includes desktop and laptop computers (including notebooks, tablets and similar devices), non-portable printers and copiers, emergency management equipment, communication devices and systems, medical and laboratory equipment, and media equipment are also considered Supplies.

c. Prior approval by DSHS of the purchase of Controlled Assets is not required, but such purchases

must be reported on the Contractors Property Inventory Form as detailed under Section 22.04. Section 22.04 Property Inventory and Protection of Assets. Contractor shall maintain an inventory of equipment, supplies defined as controlled assets, and property described in Section 14.06 of the General Provisions and submit an annual cumulative report of the equipment and other property on Contractor’s Property Inventory Report to the Department’s Contract Oversight and Support Section, Mail Code 1326, P.O. Box 149347, Austin, Texas 78714-9347, no later than October 15th of each year. The report is located on the DSHS website at: http://www.dshs.state.tx.us/contracts/forms.shtm.

Contractor shall maintain, repair, and protect assets under this Contract to assure their full availability and usefulness.

If Contractor is indemnified, reimbursed, or otherwise compensated for any loss of, destruction of, or damage to the assets provided or obtained under this Contract, Contractor shall use the proceeds to repair or replace those assets.

Section 22.05 Assets as Collateral Prohibited. Contractors on a cost reimbursement payment method shall not encumber equipment purchased with Department funds without prior written approval from the Department.

ARTICLE XXIII PROGRAM FUNDS AND PAYMENTS

Section 23.01 Use of Funds. Contractor shall expend Department funds only for the provision of approved services and for reasonable and allowable expenses directly related to those services.

Section 23.02 Use for Match Prohibited. Contractor shall not use funds provided through this Contract for matching purposes in securing other funding unless directed or approved by the Department in writing.

http://www.dshs.state.tx.us/contracts/forms.shtm


Section 23.03 Program Income. a. Gross income directly generated from Department funds through a project or activity performed

under a Contract and/or earned only as a result of this Contract during its term is considered program income.

b. Unless otherwise required under the terms of the grant funding this Contract, Contractor shall use

the addition alternative, as provided in the Uniform Grant Management Standards, for the use of program income to further the program objectives of the state or federal statute that provided the authority of this Contract or its Program Attachment, and Contractor shall spend the program income on the same Project Attachment or Statement of Work project under which it was generated.

c. Contractor shall identify and report this income in accordance with Article IX of these General

Provisions and the provisions in the Contract or its Program Attachment(s).

d. Contractor shall expend program income during the Program Attachment term and may not carry forward to any succeeding term. Contractor shall refund program income not expended in the term in which it is earned to DSHS.

e. DSHS may base future funding levels, in part, upon Contractor’s proficiency in identifying, billing,

collecting, and reporting program income, and in using it for the purposes and under the conditions specified in this Contract.

Section 23.04 Nonsupplanting. Contractor shall not use funds from this Contract to replace or substitute existing funding from other sources that also supports the activities that are the subject of this Contract but rather shall use funds from this Contract to supplement existing state or local funds currently available for a particular activity.

Contractor shall make a good faith effort to maintain its current level of support.

Contractor may be required to submit documentation substantiating that a reduction in state or local funding, if any, resulted for reasons other than receipt or expected receipt of funding under this Contract.

Section 23.05 Payment Methods. Section 5.01 of the General Provisions is replaced with the following: Except as otherwise provided by the provisions of this Contract or its Program Attachment(s), the payment method for it will be cost reimbursement. This payment method is based on an approved budget in this Contract or its Program Attachment(s) and acceptable submission of a request for reimbursement.

Section 23.06 Financial Status Reports (FSRs). Except as otherwise provided in these General Provisions or in the terms of Contracts, if a contract has a categorical budget, Contractor shall submit quarterly FSRs to Accounts Payable by the last business day of the month following the end of each quarter of the Contract term for Department review and financial assessment. Contractor shall submit the final FSR no later than 45 calendar days following the end of the Contract term.

Section 23.07 Working Capital Advance. If necessary, if allowed by law, and if permitted at DSHS sole discretion, Contractor's requests for an advance of funds shall be limited to the minimum amount needed for effective accomplishment of the Project under this Contract, and shall be timed as closely as possible to actual cash requirements. Contractor


shall establish procedures to minimize the time elapsing between the transfer of funds from DSHS to Contractor, and shall ensure that such funds are disbursed as soon as administratively possible.

Section 23.08 Condition Precedent to Requesting Payment. Contractor shall disburse program income, rebates, refunds, contract settlements, audit recoveries, and interest earned on such funds before requesting cash payments including any advance payments from Department.

Section 23.09 Management and Control Systems.

a. Contractor shall maintain an appropriate contract administration system to ensure that all terms, conditions, and specifications are met during the term of the contract through the completion of the closeout procedures.

b. Contractor shall develop, implement, and maintain financial management and control systems

that meet or exceed the requirements of UGMS. Those requirements and procedures include, at a minimum, the following:

1. Financial planning, including the development of budgets that adequately reflect all functions

and resources necessary to carry out authorized activities and the adequate determination of costs;

2. Financial management systems that include accurate accounting records that are accessible and identify the source and application of funds provided under each Program Attachment of this Contract, and original source documentation substantiating that costs are specifically and solely allocable to a Contract and its Program Attachment and are traceable from the transaction to the general ledger;

3. Effective internal and budgetary controls; 4. Comparison of actual costs to budget; determination of reasonableness, allowableness, and

allocability of costs; 5. Timely and appropriate audits and resolution of any findings; 6. Billing and collection policies; and 7. Mechanism capable of billing and making reasonable efforts to collect from clients and third

parties. Section 23.10 Effect of Grant Close Out. Contractor must submit all requests for reimbursement prior to the date of the closure of the grant. DSHS may reject any request for reimbursement submitted after closure of the grant.

ARTICLE XXIV ALLOWABLE COSTS AND AUDIT REQUIREMENTS

Section 24.01 Allowable Costs.

a. Except as provided by Section 23.06, DSHS will reimburse Contractor for services satisfactorily performed, and sufficiently documented for allowable costs.

b. Contractor must have incurred a cost prior to claiming reimbursement and within the applicable

term to be eligible for reimbursement under this Contract.

c. DSHS will determine whether costs submitted by Contractor are allowable and eligible for reimbursement.


d. If DSHS has paid funds to Contractor for unallowable or ineligible costs, DSHS will notify Contractor in writing, and Contractor shall return the funds to DSHS within 30 calendar days of the date of this written notice.

e. DSHS may withhold all or part of any payments to Contractor to offset reimbursement for any

unallowable or ineligible expenditures that Contractor has not refunded to DSHS, or if financial status report(s) are not submitted by the due date(s). DSHS may take repayment (recoup) from funds available under this Contract in amounts necessary to fulfill Contractor’s repayment obligations.

Applicable Cost principles, Audit requirements and Administrative Requirements

Applicable Entity Applicable Cost Principles

Audit Requirements Administrative Requirements

State, Local and Tribal Governments

OMB Circular A-87 (2 CFR, Part 225)

OMB Circular A-133 and UGMS

UGMS, OMB Circular A-102, and applicable Federal awarding agency common rule

Educational Institutions OMB Circular A-21 (2 CFR, Part 220)

OMB Circular A-133

OMB Circular A-110 (2 CFR, Part 215) and applicable Federal awarding agency common rule; and UGMS, as applicable

Non-Profit Organizations

OMB Circular A-122 (2 CFR, Part 230)

OMB Circular A-133 and UGMS

UGMS; OMB Circular A-110 (2 CFR, Part 215) and applicable Federal awarding agency common rule

For-profit Organization other than a hospital and an organization named in OMB Circular A-122 (2 CFR Part, 230) as not subject to that circular.

48 CFR Part 31, Contract Cost Principles Procedures, or uniform cost accounting standards that comply with cost principles acceptable to the federal or state awarding agency

OMB Circular A- 133 and UGMS

UGMS and applicable Federal awarding agency common rule

A chart of applicable Federal awarding agency common rules is located through a weblink on the DSHS website at http://www.dshs.state.tx.us/contracts/links.shtm. OMB Circulars will be applied with the modifications prescribed by UGMS with effect given to whichever provision imposes the more stringent requirement in the event of a conflict. The Contract will specify appropriate grant guidance.

Section 24.02 Property Acquisitions. Department funds must not be used to purchase buildings or real property. Any costs related to the initial acquisition of the buildings or real property are not allowable.

http://www.dshs.state.tx.us/contracts/links.shtm


Section 24.03 Cost Allocation Plan. a. Contractor shall implement and follow the applicable Cost Allocation Plan.

b. Contractor shall submit a Cost Allocation Plan on the format provided by DSHS to the

Department’s Contract Oversight and Support Section, at Mail Code 1326, P.O. Box 149347, Austin, Texas 78714-9347, or by email to: [email protected] no later than the 60th calendar day after the effective date of the Contract, except when a Contractor has a current Cost Allocation Plan on file with the Department. If Contractor’s plan is the same as the plan previously submitted to DSHS, by signing this Contract, Contractor certifies that its current Cost Allocation Plan for the current year is the same as the plan previously submitted.

c. If the Cost Allocation Plan changes during the Contract term, Contractor shall submit a new Cost

Allocation Plan to the Contract Oversight and Support Section within 30 calendar days after the effective date of the change.

Section 24.04 Overtime Compensation. Except as provided in this section, Contractor shall be responsible for any obligations of premium overtime pay due employees. Premium overtime pay is defined as any compensation paid to an individual in addition to the employee’s normal rate of pay for hours worked in excess of normal working hours.

Funds provided under this Contract may be used to pay the premium portion of overtime only under the following conditions:

a. With the prior written approval of DSHS; b. Temporarily, in the case of an emergency or an occasional operational bottleneck; c. When employees are performing indirect functions, such as administration, maintenance, or

accounting; d. In performance of tests, laboratory procedures, or similar operations that are continuous in nature

and cannot reasonably be interrupted or otherwise completed; or e. When lower overall cost to DSHS will result.

Section 24.05 Independent Single or Program-Specific Audit.

a. If Contractor within Contractor’s fiscal year expends a total amount of at least $750,000 in federal funds awarded, Contractor shall have a single audit or program-specific audit in accordance with the 2 CFR § 200.501. The $750,000 federal threshold amount includes federal funds passed through by way of state agency awards.

b. If Contractor within Contractor’s fiscal year expends a total amount of at least $500,000 in state

funds awarded, Contractor must have a single audit or program-specific audit in accordance with UGMS, State of Texas Single Audit Circular.

c. For-profit Contractors whose expenditures meet or exceed the federal and/or state expenditure

thresholds stated above shall follow the guidelines in 2 CFR § 200.501 or UGMS, as applicable, for their program-specific audits.

d. The HHSC Office of Inspector General (OIG) will notify Contractor to complete the Single Audit

Status Registration Form.

e. If Contractor fails to complete the Single Audit Status Form within 30 calendar days after notification by OIG to do so, Contractor shall be subject to DSHS sanctions and remedies for noncompliance with this Contract.



f. The audit must be conducted by an independent certified public accountant and in accordance with applicable OMB Circulars, Government Auditing Standards, and UGMS, which is accessible through a web link on the DSHS website at http://www.dshs.state.tx.us/contracts/links.shtm.

g. Contractor shall procure audit services in compliance with this section, state procurement procedures, as well as with the provisions of UGMS. Contractor, unless Contractor is a state governmental entity, shall competitively re-procure independent single audit services at least every six years.

Section 24.06 Submission of Audit. Within thirty (30) calendar days of receipt of the audit reports required by the Independent Single or Program- Specific Audit section, Contractor shall submit one copy to the Department’s Contract Oversight and Support Section, and one copy to the OIG, at the following addresses:

Department of State Health Services Contract Oversight and Support, Mail Code 1326 P.O. Box 149347 Austin, Texas 78714-9347 Health and Human Services Commission Office of Inspector General Compliance/Audit, Mail Code 1326 P.O. Box 85200 Austin, Texas 78708-5200

Electronic submission to DSHS should be addressed as follows: [email protected]

Electronic submission to HHSC should be addressed as follows: [email protected] If Contractor fails to submit the audit report as required by the Independent Single or Program-Specific Audit section within thirty (30) calendar days of receipt by Contractor of an audit report, Contractor shall be subject to DSHS sanctions and remedies for non-compliance with this Contract.

ARTICLE XXV INSURANCE AND BONDS Section 25.01 Insurance. In addition to the Insurance provision in Section 14.22 of the General Provisions, Contractor shall maintain insurance or other means of repairing or replacing assets purchased with Department funds.

Contractor shall repair or replace with comparable equipment any such equipment not covered by insurance that is lost, stolen, damaged or destroyed. If any insured equipment purchased with DSHS funds is lost, stolen, damaged or destroyed, Contractor shall notify the contract manager assigned to this Contract within 5 business days of learning of the loss, to obtain instructions whether to submit and pursue an insurance claim. Contractor shall use any insurance proceeds to repair the equipment or replace the equipment with comparable equipment or remit the insurance proceeds to DSHS.





Section 25.02 Fidelity Bond. a. For the benefit of DSHS, Contractor is required to carry a fidelity bond or insurance coverage equal

to the amount of funding provided under this Contract up to $100,000 that covers each employee of Contractor handling funds under this Contract, including person(s) authorizing payment of such funds.

b. The fidelity bond or insurance must provide for indemnification of losses occasioned by any

fraudulent or dishonest act or acts committed by any of Contractor’s employees, either individually or in concert with others, and/or failure of Contractor or any of its employees to perform faithfully his/her duties or to account properly for all monies and property received by virtue of his/her position or employment. The bond or insurance acquired under this section must include coverage for third party property.

c. Contractor shall notify, and obtain prior approval from, the DSHS Contract Oversight and Support

Section before settling a claim on the fidelity bond or insurance. Section 25.03 Liability Coverage. For the benefit of DSHS, Contractor shall at all times maintain liability insurance coverage, referred to in Tex. Gov. Code § 2261.102, as “director and officer liability coverage” or similar coverage for all persons in management or governing positions within Contractor’s organization or with management or governing authority over Contractor’s organization (collectively “responsible persons”). This section applies to entities that are organized as non-profit corporations under the Texas Non-Profit Corporation Act; for-profit corporations organized under the Texas Business Corporations Act; and any other legal entity.

Contractor shall maintain copies of liability policies on site for inspection by DSHS and shall submit copies of policies to DSHS upon request. Contractor shall maintain liability insurance coverage in an amount not less than the total value of this Contract and that is sufficient to protect the interests of Department in the event an actionable act or omission by a responsible person damages Department’s interests. Contractor shall notify, and obtain prior approval from, the DSHS Contract Oversight and Support Section before settling a claim on the insurance.

ARTICLE XXVI TERMINATION, BANKRUPTCY AND CLOSEOUT Section 26.01 Final Budget Contractor shall submit an actual Budget to DSHS no later than sixty (60) days after the contract termination date or at the conclusion of all contract activities, whichever occurs first. The Budget shall be in a format prescribed by DSHS and shall be accompanied by a report of all activities performed under this Contract.

Section 26.02 Bankruptcy. In the event of bankruptcy, Contractor shall sever Department property, equipment, and supplies in possession of Contractor from the bankruptcy, and title must revert to Department. If directed by DSHS, Contractor shall return all such property, equipment and supplies to DSHS.

Contractor shall ensure that its subcontracts, if any, contain a specific provision requiring that in the event the subcontractor’s bankruptcy, the subcontractor must sever Department property, equipment, and supplies in possession of the subcontractor from the bankruptcy, and title must revert to Department, who may require that the property, equipment and supplies be returned to DSHS.


Section 26.03 Title to Property. At the expiration or termination of this Contact for any reason, title to any remaining equipment and supplies purchased with funds under this Contract reverts to Department. Title may be transferred to any other party designated by Department. The Department may, at its option and to the extent allowed by law, transfer the reversionary interest to such property to Contractor.

Section 26.04 Disposition of Property.

a. Contractor shall follow the procedures in the American Hospital Association’s (AHA) “Estimated Useful Lives of Depreciable Hospital Assets” in disposing, at any time during or after the Contract term, of equipment purchased with the Department funds, except when federal or state statutory requirements supersede or when the equipment requires licensure or registration by the state, or when the acquisition price of the equipment is equal to or greater than $5,000.

b. All other equipment not listed in the AHA reference (other than equipment that requires licensure or

registration or that has an acquisition cost equal to or greater than $5,000) will be controlled by the requirements of UGMS.

c. If, prior to the end of the useful life, any item of equipment is no longer needed to perform services

under this Contract, or becomes inoperable, or if the equipment requires licensure or registration or had an acquisition price equal to or greater than $5,000, Contractor shall request disposition approval and instructions in writing from the contract manager assigned to this Contract.

d. After an item reaches the end of its useful life, Contractor shall ensure that disposition of any

equipment is in accordance with Generally Accepted Accounting Principles, and any applicable federal guidance.

Section 26.05 Closeout of Equipment. At the end of the term of a Contract that has no additional renewals or that will not be renewed (Closeout), or when a Contract is otherwise terminated, Contractor shall submit to the contract manager assigned to this, an inventory of equipment purchased with Department funds and request disposition instructions for such equipment.

All equipment purchased with Department funds must be secured by Contractor at the time of Closeout, or termination of this Contract, and must be disposed of according to the Department’s disposition instructions, which may include return of the equipment to DSHS or transfer of possession to another DSHS contractor, at Contractor’s expense.

ARTICLE XXVII NON-EXCLUSIVE LIST OF APPLICABLE LAWS

Where applicable, federal statutes and regulations, including federal grant requirements applicable to funding sources, will apply to this Contract. Contractor agrees to comply with applicable laws, executive orders, regulations and policies, as well as Office of Management and Budget (OMB) Circulars (as codified in Title 2 of the Code of Federal Regulations), the Uniform Grant and Contract Management Act of 1981 (UGMA), Tex. Gov. Code Chapter 783, and Uniform Grant Management Standards (UGMS), as revised by federal circulars and incorporated in UGMS by the Comptroller of Public Accounts, Texas Procurement and Support Services Division. UGMA and UGMS can be located through web links on the DSHS website at http://www.dshs.state.tx.us/contracts/links.shtm.



Contractor also shall comply with all applicable federal and state assurances contained in the Uniform Grant Management Standards. If applicable, Contractor shall comply with the Federal awarding agency’s Common Rule, and the U.S. Health and Human Services Grants Policy Statement, both of which may be located through web links on the DSHS website at http://www.dshs.state.tx.us/contracts/links.shtm. For contracts funded by block grants, Contractor shall comply with Tex. Gov. Code Chapter 2105.


CSCU # EF29-12374 - Revised 08.10.07

CERTIFICATION REGARDING LOBBYING

CERTIFICATION FOR CONTRACTS, GRANTS, LOANS AND COOPERATIVE

AGREEMENTS

The undersigned certifies, to the best of his or her knowledge and belief that:

(1) No federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to

any person for influencing or attempting to influence an officer or an employee of any agency, a

member of Congress, an officer or employee of Congress, or an employee of a member of Congress in

connection with the awarding of any federal contract, the making of any federal grant, the making of

any federal loan, the entering into of any cooperative agreement, and the extension, continuation,

renewal, amendment, or modification of any federal contract, grant, loan, or cooperative agreement.

(2)

If any funds other than federal appropriated funds have been paid or will be paid to any person for

influencing or attempting to influence an officer or employee of any agency, a member of Congress,

an officer or employee of Congress, or an employee of a member of Congress in connection with this

federal contract, grant. loan, or cooperative agreement, the undersigned shall complete and submit

Standard Form LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions.

(3) The undersigned shall require that the language of this certification be included in the award

documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants,

loans and cooperative agreements) and that all subrecipients shall certify and disclose accordingly.

This certification is a material representation of fact upon which reliance was placed when this transaction

was made or entered into. Submission of this certification is a prerequisite for making or entering into this

transaction imposed by Section 1352, Title 31, U.S. Code. Any person who fails to file the required

certification shall be subject to a civil penalty of not less that $10,000 and not more than $100,000 for each

such failure.

Signature Date

Print Name of Authorized Individual

2016-048897

Application or Contract Number

CITY OF LAREDO HEALTH

DEPARTMENT

Organization Name

TEXAS DEPARTMENT OF STATE HEALTH SERVICES



SUBJECTAuthorizing the City Manager to accept a voucher payment reimbursement of additionalfunds in the amount of $350,000.00 (for remodeling and roof repairs of the Santo NinoCommunity Center) from the Texas Department of State Health Services (TDSHS) andamending the FY 2015-2016 Health Department Budget by appropriating additionalrevenues and expenditures for a total of $5,964,826.00 for the Women, Infants andChildren (WIC) Program of the City of Laredo Health Department (CLHD) for the periodof October 1, 2015 through September 30, 2016.


PREVIOUS COUNCIL ACTIONOn January 19, 2016, Council approved Resolution 2016-R-07.

BACKGROUNDThe Texas Department of State Health Services has contracted with the City of Laredoto continue to provide public health services to residents of Webb, Duval, Jim Hogg,Zapata, Brooks, Jim Wells, Kleberg, and Live Oak Counties through the City of LaredoHealth Department (CLHD) for wellness, nutrition services and food supplementalservices through the Women, Infant and Children (WIC) Program.

The WIC Program provides health screening, nutrition education and counseling,breastfeeding education and counseling, food supplemental services for whole grains,fruits, vegetables and dairy products, referrals to other programs, and immunizations atno cost to high risk, low income, eligible residents who are pregnant, lactating, infants,and children up to age five who are identified to have a nutritional risk.

Resources through this award will allow for the renovation, roof repairs and parkingexapnsion of the Santo Niño WIC Wellnes Center located at 2200 Zacatecas Street inLaredo, Texas.


STAFF RECOMMENDATIONStaff recommends that Council introduce the Ordinance.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The revenue account 226-0000-323-4037 and expenditure division 226-6008 withproject number HEWI08 will increase by $350,000.00.

AttachmentsDSHS LetterOrdinance

ORDINANCE

AUTHORIZING THE CITY MANAGER TO ACCEPT A CONTRACT AMENDMENT FROM THE TEXAS DEPARTMENT OF STATE HEALTH SERVICES (TDSHS) AND AMENDING THE FY 2015-2016 HEALTH DEPARTMENT BUDGET BY APPROPRIATING ADDITIONAL REVENUES AND EXPENDITURES IN THE AMOUNT OF $350,000.00 FOR A TOTAL OF $5,964,826.00 FOR THE WOMEN, INFANTS AND CHILDREN (WIC) PROGRAM OF THE CITY OF LAREDO HEALTH DEPARTMENT (CLHD) TO CONTINUE TO PROVIDE NUTRITION EDUCATION AND FOOD SUPPLEMENTAL SERVICES TO HIGH RISK WOMEN AND CHILDREN FOR THE TERM PERIOD OF OCTOBER 1, 2015 THROUGH SEPTEMBER 30, 2016.

WHEREAS, The Texas Department of State Health Services has contracted with the City of Laredo to continue to provide public health services to residents of Webb, Duval, Jim Hogg, Zapata, Brooks, Jim Wells, Kleberg, and Live Oak Counties through the City of Laredo Health Department (CLHD) for wellness, nutrition services and food supplemental services through the Women, Infant and Children (WIC) Program; and

WHEREAS, the WIC Program provides health screening, nutrition education and counseling, breastfeeding education and counseling, food supplemental services for whole grains, fruits, vegetables and dairy products, referrals to other programs, and immunizations at no cost to high risk, low income, eligible residents who are pregnant, lactating, infants, and children up to age five who are identified to have a nutritional risk.

WHEREAS, resources through this award will allow for the renovation of the Santo Niño WIC clinic, located at 2200 Zacatecas Street in Laredo, Texas.

NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT:

Section 1: The City Manager is hereby authorized to accept a contract amendment from the Texas Department of State Health Services (TDSHS) and amend the FY 2015-2016 Health Department Budget by appropriating additional revenues and expenditures in the amount of $350,000.00 for a total of $5,964,826.00 for the Women, Infants and Children (WIC) Program of the City of Laredo Health Department (CLHD) to continue to provide nutrition education and food supplemental services to high risk women and children for the term period of October 1, 2015 through September 30, 2016.

2

Section 2: The revenue account 226-0000-323-4037 and expenditure division 226-6008 with project number HEWI08 are hereby increased by $350,000.00.

Section 3: The City Manager is hereby authorized to make transfers within the budget as allowable to meet the necessary costs to accomplish the scope of work for the program.


THIS _________________ DAY OF ________________________, 2016.

______________________________PETE SAENZMAYOR

ATTEST:






Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Luis Castillo, owner

Staff Source: Nathan R. Bratton, Planning Director

SUBJECTAmending the Zoning Ordinance (Map) of the City of Laredo by rezoning Lot 2, Block624, Western Division, located at 2416 Ventura Street, from R-2 (Multi-FamilyResidential District) to R-3 (Mixed Residential District); providing for publication andeffective date.

Staff does not support the application and the Planning and Zoning Commissionrecommends approval of the zone change. District VIII

PREVIOUS COUNCIL ACTIONThis item was denied at the regular meeting of January 19, 2016. It is placed on theagenda for reconsideration.

BACKGROUNDCouncil District: VIII – The Honorable Roberto Balli

Proposed use: Manufactured home

Site: vacant lot

Surrounding land uses: The properties to the north include single-family residences,multi-family residential and vacant lots. To the east are single-family residences,manufactured homes, vacant lots, vacant commercial structures and tractor trailerstorage. To the west are single-family residences and vacant lots. To the south aresingle-family residential residences and vacant lots.

Comprehensive Plan: The Future Land Use Map recognizes this area as MediumDensity Residential.

Transportation Plan: The Long Range Thoroughfare Plan does not identify VenturaStreet.

Letters sent to surrounding property owners: 35 In Favor: 0 Opposed: 0

STAFF COMMENTS

Staff does not recommend approval of the proposed zone change for the followingreasons:

The proposed zone change is not appropriate at this location because it is notcompatible with the primarily single-family residential uses in the immediate area.

1.

The proposed R-3 district is not in conformance with the existing low densityresidential land use pattern in the neighborhood.

2.

The proposed district may introduce more intense uses into the well-establishedneighborhood.

IMPACT ANALYSIS

R-3 (Mixed Residential District): The purpose of the R-3 is to provide an area forhigher density residential uses, the use of mobile homes on single lots, and thosepublic and semipublic uses normally considered an integral part of theneighborhood they serve.

Is this change contrary to the established land use pattern? Yes, the established land use pattern is primarily single-family residential in nature.

Would this change create an isolated zoning district unrelated tosurrounding districts? No, there are other R-3 districts to the east and west.

Will change adversely influence living conditions in the neighborhood? Yes, the change may introduce uses of a more intense nature to the neighborhood.

Are there substantial reasons why the property can not be used inaccordance with existing zoning? Yes. The current R-2 district does not permit manufactured homes.

3.

COMMITTEE RECOMMENDATIONThe P & Z Commission, in a 7to 0vote, recommended approvalof the zone change.

STAFF RECOMMENDATIONStaff does not supportthe proposed zone change.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:

Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:N/A

AttachmentsOrdinanceZoning MapAerial MapFuture Land Use MapZoning Overview MapPicturesSurvey

1

ORDINANCE NO. 2016-O-

AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING LOT 2, BLOCK 624, WESTERN DIVISION, LOCATED AT 2416 VENTURA STREET, FROM R-2 (MULTI-FAMILY RESIDENTIAL DISTRICT) TO R-3 (MIXED RESIDENTIAL DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owners of Lot 2, Block 624, Western Division, located at 2416 Ventura Street, from R-2 (Multi-Family Residential District) to R-3 (Mixed Residential District); and, WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on December 17, 2015, and, WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the proposed zone change; and, WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and, WHEREAS, the City Council has held a public hearing on February 1, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and, WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT: Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning Lot 2, Block 624, Western Division, located at 2416 Ventura Street, from R-2 (Multi-Family Residential District) to R-3 (Mixed Residential District). Section 2: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo.

2

Section 3: This ordinance shall become effective as and from the date of publication specified in Section 2. PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE __________ DAY OF _________________, 2016. _____________________________________ PETE SAENZ MAYOR ATTEST: ___________________________ DOANH “ZONE” T. NGUYEN ACTING CITY SECRETARY APPROVED AS TO FORM: RAUL CASSO, CITY ATTORNEY ____________________________ KRISTINA K. LAUREL HALE ASSISTANT CITY ATTORNEY

623636

634625

618

635624 619

620

VENTURA ST 55.56'

WATER ST 55.56'

PIEDREGAL ST 55.56'SH

EAD E

N AVE

55.56

'

ATLE

E AVE

55.56

'

WILH

ELM

AVE 5

5.56'

HEAD

EN AV

E 55.5

6'

R-3

B-3

R-2

R-3 R-3

2420L: 1

2419L: 8

2414L: 2

2404L: 3

2402L: 4

2320L: 1

2319L: 8A

2317L: 8B

2312L: 2

2308L: 3

104L: 4

118L: 5

2520L: 1

2519L: 10

2516L: 2

2512L: 3

2517L: 9

2515L: 8 218

L: 7B& 6B

118L: 7A & 6A

2307L: 6A 2305

L: 6B-5A

2302L: 4

2301L: 5B

2620L: 1

2620L: 4 2520

L: 1

2520L: 1

2520L: 2

2500L: 3

2500L: 4 2420

L: 1201L: 2

2403L: 3

2320L: 8

2402L: 4

2305L: 1

2320L: 7

2320L: 6

2305L: 2 2305

L: 3

2320L: 5

2305L: 4

2511L: 7B

2601L: 7B

2520L: 1

2519L: 8

2509L: 7A

2507L: 6B

2503L: 5B

106L: 10

2518L: 2

2519L: 7

2502L: 9

108L: 4

110L: 3

2419L: 8

2419L: 8

2407L: 7

2403L: 6

2416L: 2

2417L: 7

202L: 3

2415L: 6

2401L: 5

2305L: 8

202L: 4

2401L: 6& 5

2309L: 7

2305L: 6 2305

L: 5

2320L: 1

2319L: 8

2318L: 2

2318L: 3

2317L: 7A

2315L: 7B 2301

L: 6

102L: 4B

104L: 4A

2301L: 5

2601L: 5A

2513L: 1-A 2505

L: 6A2501L: 5A

L:

2420L: 8

2420L: 7

2420L: 6

2420L: 5

2318L: 7

2315L: 7

2602L: 1A

L:UNPLATTED

2507L: 6

2503L: 6& 5

104L: 4 & 5

2501L: 6& 5

205L: 6 & 5

102L: 5

2403L: 6-5

2401L: 5110L: 5

2405L: 6

2415L: 7

2417L: 7

2506L: 4

102L: 4

206L: 1

L: 5

23071/2

L: 6A

L:

206L: 1

1 inch = 100 feetDate: 12/2/2015

ZC-06-2016COUNCIL DISTRICT 8

REZONE FROMR2 (MULTI-FAMILY RESIDENTIAL DISTRICT)

-> R3 (MIXED RESIDENTIAL DISTRICT)2416 VENTURA ST

S.U.P. (SPECIAL USE PERMITS)C.U.P. (CONDITIONAL USE PERMITS)S.U.P. & C.U.P.

ZONING MAP

0 10050Feet

2420L: 1

2419L: 8

2414L: 2

2404L: 3

2402L: 4 2320

L: 1

2319L: 8A

2317L: 8B

2312L: 2

2308L: 3

104L: 4

118L: 5

2520L: 1

2519L: 10

2516L: 2

2512L: 3

2517L: 9

2515L: 8 218

L: 7B& 6B

118L: 7A& 6A

2307L: 6A 23

05L:

6B-5A

2302L: 4

2301L: 5B

2620L: 1

2620L: 4 2520

L: 1

2520L: 1

2520L: 2

2500L: 3

2500L: 4

2420L: 1

201L: 2

2403L: 3

2320L: 8

2402L: 4 2305

L: 1

2320L: 7

2320L: 6

2305L: 2

2305L: 3

2320L: 5

2305L: 4

2511L: 7B

2601L: 7B

2520L: 1

2519L: 8

2509L: 7A

2507L: 6B

2503L: 5B

106L: 10

2518L: 2

2519L: 7

2502L: 9

108L: 4

110L: 3

2419L: 8

2419L: 8

2407L: 7

2403L: 6

2416L: 2

2417L: 7

202L: 3

2415L: 6

2401L: 5

2305L: 8

202L: 4

2401L: 6 & 5

2309L: 7

2305L: 6

2305L: 5

2320L: 1

2319L: 8

2318L: 2

2318L: 3

2317L: 7A

2315L: 7B

2301L: 6

102L: 4B

104L: 4A

2301L: 5

2601L: 5A 2513

L: 1-A 2505L: 6A 2501

L: 5A

L:

2420L: 8

2420L: 7

2420L: 6

2420L: 5

2318L: 7

2315L: 7

2602L: 1A

L:UN

PLAT

TED

2507L: 6

2503L: 6 & 5

104L: 4& 5

2501L: 6& 5

205L: 6 & 5

102L: 5

2403L: 6-5

2401L: 5110L: 5

2405L: 6

2415L: 7

2417L: 7

2506L: 4 10

2L:

4206L: 1

L:5

2307

1/2

L: 6A

2601L: 5

2610 L: 4

L:

206L: 1

623636

634625

618

635624 619

620

VENTURA ST 55.56'

WATER ST 55.56'


EAD E

N AVE

55.56

'

ATLE

E AVE

55.56

'

WILH

ELM

AVE 5

5.56'

HEAD

EN AV

E 55.5

6'

1 inch = 100 feetDate: 12/2/2015




AERIAL MAP

0 10050Feet

2420L: 1

2419L: 8

2414L: 2

2404L: 3

2402L: 4 2320

L: 1

2319L: 8A

2317L: 8B

2312L: 2

2308L: 3

104L: 4

118L: 5

2520L: 1

2519L: 10

2516L: 2

2512L: 3

2517L: 9

2515L: 8 218

L: 7B& 6B

118L: 7A& 6A

2307L: 6A 23

05L:

6B-5A

2302L: 4

2301L: 5B

2620L: 1

2620L: 4

2520L: 1

2520L: 1

2520L: 2

2500L: 3

2500L: 4 2420

L: 1201L: 2

2403L: 3

2320L: 8

2402L: 4 2305

L: 1

2320L: 7

2320L: 6

2305L: 2

2305L: 3

2320L: 5

2305L: 4

2511L: 7B

2601L: 7B

2520L: 1

2519L: 8

2509L: 7A

2507L: 6B

2503L: 5B

106L: 10

2518L: 2

2519L: 7

2502L: 9

108L: 4

110L: 3

2419L: 8

2419L: 8

2407L: 7

2403L: 6

2416L: 2

2417L: 7

202L: 3

2415L: 6

2401L: 5 2305

L: 8

202L: 4

2401L: 6 & 5

2309L: 7

2305L: 6

2305L: 5

2320L: 1

2319L: 8

2318L: 2

2318L: 3

2317L: 7A

2315L: 7B 2301

L: 6

102L: 4B

104L: 4A

2301L: 5

2601L: 5A

2513L: 1-A 2505

L: 6A 2501L: 5A

L:

2420L: 8

2420L: 7

2420L: 6

2420L: 5

2318L: 7

2315L: 7

2602L: 1A

L:UN

PLAT

TED

2507L: 6

2503L: 6 & 5

104L: 4& 5

2501L: 6& 5

205L: 6 & 5

102L: 5

2403L: 6-5

2401L: 5

110L: 5

2405L: 6

2415L: 7

2417L: 7

2506L: 4 10

2L:

4

206L: 1

L:5

2307

1/2

L: 6A

2601L: 5

2610 L: 4

L:

206L: 1

623636

634625

618

635624 619

620

VENTURA ST 55.56'

WATER ST 55.56'


EAD E

N AVE

55.56

'

ATLE

E AVE

55.56

'

WILH

ELM

AVE 5

5.56'

HEAD

EN AV

E 55.5

6'

MediumDensity

Residential

MediumDensity

ResidentialMediumDensity

Residential

MediumDensity

Residential

MediumDensity

Residential

MediumDensity

Residential

MediumDensityResidential

MediumDensity

Residential

High DensityResidential



HighDensity

Residential

LightCommercial

LightCommercial

LightCommercial

MediumDensity

Residential

HighDensity

Residential

Medium DensityResidential

MediumDensity

Residential

MediumDensity

Residential

MediumDensity

Residential

MediumDensity

Residential

LightCommercial

MediumDensity

ResidentialHigh

DensityResidential

MediumDensity

Residential

HighDensity

Residential




Parks/OpenSpace


MediumDensity

Residential

MediumDensity

Residential


MediumDensity

Residential


MINORARTERIAL-PLANNED

1 inch = 100 feetDate: 12/2/2015




FUTURE LANDUSE MAP

0 10050Feet

ITURBIDE ST 55.56'

GRANT ST 55.56'

RIVE R RD 40'

SAN T

ACLE

O TIL D

E AVE

50'

MAI N

AVE 5 0'

PIEDREGALST40' MAIN

AVE 3

0'

MOWR

Y AVE

55.56

'

VIDAU

RRI A

VE 30

'

M AIN

A VE 28'

SANTAISABELAVE 55.56'

EVAN

SAV

E55.

5 6'

MAI N

AVE 2 0'

EVAN

SA V

E 40'

MAIN

A VE

2 6'

LINCOLN ST 30'

ZARAGOZA ST 41'

ITURBIDE ST 21'

FARRAGUT ST 35'

VENTURA ST 40'

HIDALGO ST 30'

WATER ST 31'

VENTURA ST 55.56'

WATER ST 55.56'

PIEDREGAL ST 55.56'

HUDSONRD50'

AINSWORTH RD 0'

HEAD

EN AV

E 55.5

6'

SANFRAN CI SC O JA VIER

AVE 50'

HUDSON RD 0'

1 inch = 500 feetDate: 12/2/2015




ZONING OVERVIEW

0 10020030040050050Feet

2416 Ventura StreetR-2 (Multi-Family Residential District) to R-3 (Mixed Residential District)

ZC-06-2016

Introductory Ordinances 4. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Jose Luis Flroes

SUBJECTAuthorizing the City Manager to execute a lease agreement with Washington’s BirthdayCelebration Association, Inc. (W.B.C.A.) for approximately 3.9 acres and more formallyknown as the “Park and Ride”, and the approximate 7.35 acres consisting of all Lot No’s.1 and 2 of the Laredo International Airport Manufacturing Facilities Subdivision Plat, andthe portion area north of the Animal Care Shelter on Maher/Hillside/Thomas Street forthe W.B.C.A. Jalapeno Festival and other W.B.C.A. sponsored events. The lease term isfor five (5) consecutive years for the month of February commencing on February 2016and ending on February 2020 and providing for termination. Initial annual rental rate of$1,000.00; providing for an effective date. (Approved by Operations and FinanceCommittees)

PREVIOUS COUNCIL ACTIONN/A

BACKGROUNDWashington’s Birthday Celebration Association, INC., (W.B.C.A.) has been in goodstanding with the airport since 1992.

The Washington’s Birthday Celebration is the oldest celebration in the United Stateshonoring the first president of our country, George Washington. Done with internationalflair, the WBCA and the City of Laredo hosts a party with 28 events in 32 days! Anincredible air show, the jalapeño festival, a carnival with exhilarating rides, lavishpageants depicting our country’s early history. .

The subject property is leased “AS IS” condition.

COMMITTEE RECOMMENDATIONOn November 3, 2015, the Airport Advisory Board considered this item andrecommends approval.

STAFF RECOMMENDATIONApproval of this Ordinance.

Approval of this Ordinance.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: yesSource of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Land Rent242-000-361-2060February annual rent: $1,000.00

AttachmentsWBCA ORDWBCA DOC

of 2

ORDINANCE NO.

AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE AGREEMENT WITH WASHINGTON’S BIRTHDAY CELEBRATION ASSOCIATION, INC. (W.B.C.A.) FOR APPROXIMATELY 3.9 ACRES AND MORE FORMALLY KNOWN AS THE “PARK AND RIDE”, AND THE APPROXIMATE 7.35 ACRES CONSISTING OF ALL LOT NO’S. 1 AND 2 OF THE LAREDO INTERNATIONAL AIRPORT MANUFACTURING FACILITIES SUBDIVISION PLAT, AND THE PORTION AREA NORTH OF THE ANIMAL CARE SHELTER ON MAHER/HILLSIDE/THOMAS STREET FOR THE W.B.C.A. JALAPENO FESTIVAL AND OTHER W.B.C.A. SPONSORED EVENTS. THE LEASE TERM IS FOR FIVE (5) CONSECUTIVE YEARS FOR THE MONTH OF FEBRUARY COMMENCING ON FEBRUARY 2016 AND ENDING ON FEBRUARY 2020 AND PROVIDING FOR TERMINATION. INITIAL ANNUAL RENTAL RATE OF $1,000.00; PROVIDING FOR AN EFFECTIVE DATE.

WHEREAS, the Airport Manager recommends that the City Council approve the proposed lease between the City of Laredo, as LESSOR, and the Washington’s Birthday Celebration Association, as LESSEE, for approximately 3.9 acres and more formally known as the “Park and Ride”, and the approximate 7.35 acres consisting of all Lot No’s. 1 and 2 of the Laredo International Airport Manufacturing Facilities Subdivision Plat, and the portion area north of the Animal Care Shelter on Maher/Hillside/Thomas Streetfor the W.B.C.A. Jalapeno Festival and other W.B.C.A. sponsored events at the Laredo International Airport, as a contract and in furtherance of the development of the Laredo International Airport and as a support to the maintenance and operation of the Laredo International Airport;

WHEREAS, the Airport Advisory Board finds that said lease is in the best interest of the Airport and recommends that the City Council approve the proposed lease; and

WHEREAS, the City Council of the City of Laredo having heard the recommendations of the Airport Manager and of the Airport Advisory Board agrees with same.

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT:

Section 1: The City Manager be hereby authorized to execute a lease with the Washington’s Birthday Celebration Association for approximately 3.9 acres and more formally known as the “Park and Ride”, and the approximate 7.35 acres consisting of all Lot No’s. 1 and 2 of the Laredo International Airport Manufacturing Facilities Subdivision Plat, and the portion area north of the Animal Care Shelter on Maher/Hillside/Thomas Street for the W.B.C.A. Jalapeno Festival and other W.B.C.A. sponsored events at the Laredo International Airport, a copy of which lease is attached hereto as Exhibit A, and incorporated herein as if set out at length for all intents and purposes.

of 2

Section 2: This Ordinance shall become effective upon passage hereof.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE ____ DAY OF ________________, 2016

_________________________PETE SAENZMAYOR

ATTEST:

_____________________________DOANH “ZONE” NGUYENACTING CITY SECRETARY


BY:__________________________RAUL CASSO CITY ATTORNEY


Initiated By: Cynthia Collazo, Deputy City Manager Initiated By: Cynthia Collazo

Staff Source: Arturo Garcia

SUBJECTClosing and vacating as a public easement that section of Center Road, as dedicated bythe R. M.R. Industrial Park Plat Unit 2, Volume 3, page 23, of the Webb County PlatRecords and providing for the reversion of all public interest in said dedicated road tothe current abutting landowners in equal shares provided that the City retain the eastone half section of the road as a utility easement. The road section is further depicted onattached exhibit A and providing for an effective date. (Approved by OperationsCommittee)

PREVIOUS COUNCIL ACTIONNone

BACKGROUNDThe City received a request to close and vacate as a public easement that section ofCenter Road as dedicated by the R.M.R Industrial Park Plat Unit 2, City of Laredo,Webb County, Texas, by the abutting landowners. The landowners have executedRelease Forms holding the City of Laredo harmless from any all and all damages whichmay arise from the closing of said road. The flow of traffic will not be adversely affectedby such closing since the street dead ends on the south property line of a city owneddrainage tract. No future expansion of street is anticipated. Upon its closure the public’sinterest in said road will revert to the current abutting landowners in equal shares withthe City retaining the east one half section of the road as a utility easement for furtherimprovements.

COMMITTEE RECOMMENDATIONNone

STAFF RECOMMENDATIONStaff recommends the introduction of this Ordinance.

Fiscal ImpactFiscal Year:

Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:No financial impact.

AttachmentsOrdinance Exhibit A

1

INTRODUCTORY ORDINANCE

CLOSING AND VACATING AS A PUBLIC EASEMENT THAT SECTION OF CENTER ROAD, AS DEDICATED BY THE R.M.R INDUSTRIAL PARK PLAT UNIT 2, VOLUME 3, PAGE 23, OF THE WEBB COUNTY PLAT RECORDS ANDPROVIDING FOR THE REVERSION OF ALL PUBLIC INTEREST IN SAID DEDICATED ROAD TO THE CURRENT ABUTTING LANDOWNERS IN EQUAL SHARES PROVIDED THAT THE CITY RETAIN THE EAST ONE HALF SECTION OF THE ROAD AS A UTILITY EASEMENT. THE ROAD SECTION IS FURTHER DEPICTED ON ATTACHED EXHIBIT A AND PROVIDING FOR AN EFFECTIVEDATE

WHEREAS, Center Road is a non-thoroughfare road dedicated as per the R.M.R. Industrial Park Unit 2; and,

WHEREAS, traffic flow in said the road section will not be adversely affected by such closing since this street dead ends on a drainage tract and no future expansion of this road is anticipated; and,

WHEREAS, the two abutting property owners requesting the proposed road closure have executed Release Forms holding the City of Laredo harmless from any all and all damages which may arise from the closing of said road; and,

WHEREAS, upon the its closure the public’s interest in said road will revert to the current abutting landowners in equal shares provided that the City retain the east one half section of the road as a utility easement: and,

WHEREAS, the City Council finds that it is in the best interest of the City to close Center Road as a public easement and relinquish any interest the City may have on said road provided that the City retain the east one half section of the road as a utility easement. Through the authority provided in the Texas Local Government Code section 253.001(c).

.


1. The section of Center Road, as dedicated by the R.M.R Industrial Park Plat Unit 2, Volume 3, page 23, of the Webb County Plat Records is hereby closed and vacated as a public easement providing for the reversion of the public interest in said dedicated road to the current abutting landowners in equal shares provided that the city retain the east one half section of the road as a utility easement. The section road is further depicted on attached exhibit A.

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2. This Ordinance shall become effective upon passage thereof.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE _________ DAY OF _____________, 2016.

_________________________Pete SaenzMayor

ATTEST:

______________________Doanh “Zone” T. Nguyen Acting City Secretary

_________________________APPROVED AS TO FORM:Raul CassoCity Attorney


Initiated By: Cynthia Collazo, Deputy City Manager Initiated By: Cynthia Collazo - Deputy City Manager

Staff Source: Blasita Lopez - LCVB Director, Martin Aleman - Budget Manager

SUBJECTPublic hearing and introductory ordinance amending the City of Laredo's FY 2015-2016Laredo Convention and Visitors Bureau Fund budget by increasing revenues andexpenditures in the amount of $195,000.00 for funding a documentary film inconjunction with TAMIU and KLRN. The funding will be transferred from the City ofLaredo FY 2015-2016 Hotel Motel Fund budget. (Approved by Operations andFinance Committees as amended)


BACKGROUNDThe President of Texas A&M International University (TAMIU) , Dr. Ray Keck, asked theCity Council to consider funding a documentary film that the University was approachedabout and will air on KLRN. The documentary will focus the broad musical talent atTAMIU as well as community-wide and will promote Laredo's diversity and uniqueness.City Council made a motion/directive to find funding to support this project.


STAFF RECOMMENDATIONConduct a public hearing and introduce this ordinance.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: Hotel Motel FundAccount #: 244-4910-597-0250Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

CVB Fund Original Amended Budget Budget Amendment

RevenuesTranfer In from HotelMotel250-0000-393-0244 $ 3,305,855 $ 3,500,855 $ 195,000

ExpendituresKLRN Documentary Film250-5315-554-9919 $ 150,445 $ 345,445 $ 195,000

AttachmentsDocumentary Ordinance

INTRODUCTORY ORDINANCE

AMENDING THE CITY OF LAREDO’S FY 2015-2016 LAREDO CONVENTION AND VISITORS BUREAU FUND BUDGET BY INCREASING REVENUES AND EXPENDITURES IN THE AMOUNT OF $195,000.00 FOR FUNDING A DOCUMENTARY FILM IN CONJUNCTION WITH TAMIU AND KLRN. THE FUNDING WILL BE TRANSFERRED FROM THE CITY OF LAREDO’S FY 2015-2016 HOTEL MOTEL FUND BUDGET.

WHEREAS, on January 19, 2016, City Council approved a motion to fund this project; and

WHEREAS, it is being requested to amend the fiscal year 2015-2016 Convention and Visitors Bureau budget; and

WHEREAS, the documentary film will focus the broad musical talent at TAMIU as well as community-wide and will promote Laredo’s diversity and uniqueness;

NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS;

Section 1: Amending the City of Laredo’s Convention and Visitors Bureau FY 2015-2016 budget by increasing revenues and expenditures in the amount of $195,000.00.

Section 2: This Ordinance shall become effective upon passage thereof.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE _______DAY OF ________________, 2016.

PETE SAENZMAYOR

ATTEST:

__________________________DOANH “ZONE” T. NGUYENACTING CITY SECRETARY

__________________________APPROVED AS TO FORM:RAUL CASSOATTORNEY

First and Final Readings 7. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Horacio De Leon, Assistant Manager; Rosario C. Cabello, Finance

Director

SUBJECT2016-O-020 An ordinance by the City Council of the City of Laredo, Texas authorizingthe issuance, sale and delivery of City of Laredo, Texas General Obligation RefundingBonds, Series 2016; approving and authorizing a purchase contract, an escrowagreement, and a paying agent/registrar agreement; approving and authorizing all otherinstruments and procedures related thereto; delegating authority to the Mayor and/or theCity Manager to select outstanding bonds to be refunded and approve all final terms ofthe bonds; and authorizing amendment to the city's budget to appropriate such proceedsfor purposes authorized herein; and ordaining other matters relating to the subject.

VENDOR INFORMATION FOR COMMITTEE AGENDANone

PREVIOUS COUNCIL ACTIONA Plan of Finance was presented by Noe Hinojosa of Estrada-Hinojosa InvestmentBankers on January 19, 2016.

BACKGROUNDThe City of Laredo in in the process of refinancing various bond issues including aWaterworks and Sewer System Revenue Refunding Bond and a General ObligationRefunding Bond, Series 2016. The General Obligation Bond will be refunding the 2008A & 2008 B Certificates of Obligation in the estimated amounts of $59,155,000.00. Thetransaction is expected to generate estimated saving of $7,768,051.00


STAFF RECOMMENDATIONConduct first and final reading of this ordinance.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: N

Source of Funds: Bond ProceedsAccount #: VariousChange Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Savings and Interest and Principal payments will be determined at the time of the saleof the bonds.

AttachmentsOrdinance 2016-O-020

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ORDINANCE NO. 2016-O-020

AN ORDINANCE BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS AUTHORIZING THE ISSUANCE, SALE AND DELIVERY OF CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2016; APPROVING AND AUTHORIZING A PURCHASE CONTRACT, AN ESCROW AGREEMENT, AND A PAYING AGENT/REGISTRAR AGREEMENT; APPROVING AND AUTHORIZING ALL OTHER INSTRUMENTS AND PROCEDURES RELATED THERETO; DELEGATING AUTHORITY TO THE MAYOR AND/OR THE CITY MANAGER TO SELECT OUTSTANDING BONDS TO BE REFUNDED AND APPROVE ALL FINAL TERMS OF THE BONDS; AND AUTHORIZING AMENDMENT TO THE CITY'S BUDGET TO APPROPRIATE SUCH PROCEEDS FOR PURPOSES AUTHORIZED HEREIN; AND ORDAINING OTHER MATTERS RELATING TO THE SUBJECT

THE STATE OF TEXAS §COUNTY OF WEBB §CITY OF LAREDO §

WHEREAS, the CITY OF LAREDO, TEXAS (the "City") in Webb County, Texas, is a political subdivision of the State of Texas operating as a home-rule city pursuant to the Texas Local Government Code; and

WHEREAS, among numerous series of bonds of the City which are secured by the full faith and credit of the City and a pledge by the City to levy ad valorem taxes sufficient to pay principal of and interest on such bonds as they become due, within the limits permitted by law, there are specifically outstanding the following series of obligations:

City of Laredo, Texas Combination Tax and Revenue Certificates of Obligation, Series 2008A, dated May 15, 2008, maturing on February 15 in the years 2016 through 2028, and currently outstanding in the aggregate principal amount of $25,135,000 (the "Series 2008A Certificates"); and

City of Laredo, Texas Combination Tax and Waterworks and Sewer System Revenue Certificates of Obligation, Series 2008B, dated May 15, 2008, maturing on February 15 in the years 2016 through 2028, inclusive, and 2033, and currently outstanding in the aggregate principal amount of $38,195,000 (the "Series 2008B Certificates"); and

WHEREAS, pursuant to the ordinance which authorized the issuance of the Series 2008A Certificates, maturities 2018 through 2028 of such Series 2008A Certificates are subject to redemption, at the option of the City, at the redemption price of par, on February 15, 2017 or any date thereafter; and pursuant to the ordinance which authorized the issuance of the Series 2008B Certificates, maturities 2018 through 2028, inclusive, and 2033, of such Series 2008BCertificates are subject to redemption, at the option of the City, at the redemption price of par, on February 15, 2017 or any date thereafter; and

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WHEREAS, the City now desires to authorize the refunding of all or a portion of the outstanding Series 2008A Certificates and Series 2008B Certificates, which are more fully described as follows:

SERIES 2008A CERTIFICATES ELIGIBLE TO BE REFUNDED

MATURITY

(FEB. 15)PRINCIPAL AMOUNT

MATURING IN YEAR ($)

PRINCIPAL AMOUNT

ELIGIBLE TO BE

REFUNDED ($)

STATED

INTEREST

RATE (%)CUSIP NO.

(516823)

2016 1,350,000 1,350,000 4.000 F48

2017 1,410,000 1,410,000 5.000 F55

2018 1,485,000 1,485,000 5.000 F63

2019 1,700,000 1,700,000 4.000 F71

2020 1,775,000 1,775,000 4.000 F89

2021 1,845,000 1,845,000 4.125 F97

2022 1,925,000 1,925,000 4.250 G21

2023 2,015,000 2,015,000 4.500 G39

2024 2,110,000 2,110,000 5.000 G47

2025 2,220,000 2,220,000 5.000 G54

2026 2,325,000 2,325,000 4.500 G62

2027 2,435,000 2,435,000 4.500 G70

2028 2,540,000 2,540,000 4.500 G88

Totals $25,135,000 $25,135,000 *** ***

[The remainder of this page intentionally left blank.]

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SERIES 2008B CERTIFICATES ELIGIBLE TO BE REFUNDED

MATURITY

(FEB. 15)PRINCIPAL AMOUNT


PRINCIPAL AMOUNT

ELIGIBLE TO BE

REFUNDED ($)

STATED

INTEREST

RATE (%)CUSIP NO.

(516823)

2016 1,415,000 1,415,000 4.000 C74

2017 1,475,000 1,475,000 4.000 C82

2018 1,545,000 1,545,000 5.000 C90

2019 1,615,000 1,615,000 4.000 D24

2020 1,680,000 1,680,000 4.000 D32

2021 1,750,000 1,750,000 4.125 D40

2022 1,825,000 1,825,000 4.250 D57

2023 1,905,000 1,905,000 4.250 D65

2024 1,985,000 1,985,000 4.375 D73

2025 2,080,000 2,080,000 5.000 D81

2026 2,190,000 2,190,000 5.000 D99

2027 2,300,000 2,300,000 5.000 E23

2028 2,415,000 2,415,000 4.500 E31

*** *** *** *** ***

2033 14,015,000 14,015,000 5.000 E49

Totals $38,195,000 $38,195,000 *** ***

WHEREAS, pursuant to the provisions of Section 1207.007(a)(4), Texas Government Code, the City now desires to delegate to a "Designated Officer" (as defined in Section 1(a) below) the authority, individually or collectively, to select the specific maturities and principal amounts of the Series 2008A Certificates and Series 2008B Certificates described in the preceding recital to be refunded with proceeds of the bonds authorized pursuant to this Ordinance and effect the sale of such bonds; and

WHEREAS, the Series 2008A Certificates and Series 2008B Certificates selected by a Designated Officer to be refunded as authorized by Section 1(c) of this Ordinance are hereafter referred to as the "Refunded Obligations"; and

WHEREAS, any Refunded Obligations selected by the Designated Officer to be refunded

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with proceeds of the bonds authorized pursuant to this Ordinance and that are not currently callable are to be refunded for cash flow and debt service management purposes; and

WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207"), authorizes the City to issue refunding bonds and to deposit the proceeds from the sale thereof, and any other available funds or resources, directly with a place of payment (paying agent) for the Refunded Obligations, or with another trust company or commercial bank that does not act as a depository for the City, in an amount sufficient to provide for the payment and/or redemption of the Refunded Obligations, and such deposit, if made before such payment dates, shall constitute the making of firm banking and financial arrangements for the discharge and finalpayment or redemption of the Refunded Obligations; and

WHEREAS, Chapter 1207 (specifically Section 1207.062, Texas Government Code) further authorizes the City to enter into an escrow agreement with any paying agent for the Refunded Obligations, or with another trust company or commercial bank that does not act as a depository for the City, with respect to the safekeeping, investment, reinvestment, administration and disposition of any such deposit, upon such terms and conditions as the City and such paying agent may agree; provided that such deposits may be invested and reinvested in:

(i) direct noncallable obligations of the United States, including obligations that are unconditionally guaranteed by the United States,

(ii) noncallable obligations of an agency or instrumentality of the United States, including obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date the City Council of the City adopts or approves this Ordinance, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, and

(iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the date the City Council of the City adopts or approves this Ordinance, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent,

and all of which must mature and bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment or redemption of the Refunded Obligations; and

WHEREAS, the Designated Officer is hereby authorized to select any paying agent for the Refunded Obligations or another trust company or commercial bank that does not act as a depository for the City as the escrow agent (the “Escrow Agent”) for the Refunded Obligations and the Escrow Agreement hereinafter authorized between the City and Escrow Agent shall constitute an escrow agreement of the kind authorized and permitted by Chapter 1207; and

WHEREAS, the City Council of the City hereby finds and declares a public purpose and deems it advisable and in the best interests of the City to issue a series of bonds (defined in Section 2 hereof as the "Bonds"), the proceeds of which will be used to pay costs of issuance and refund the Refunded Obligations in order to achieve a gross debt service savings and a net present value debt service savings for the benefit of the taxpayers of the City; provided, however,

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in no event shall Bonds be issued unless the City is able to achieve a net present value debt service savings of at least 5.00% of the principal of the Refunded Obligations; and

WHEREAS, the Bonds hereinafter authorized and designated are to be issued and delivered pursuant to Chapter 1207; and

WHEREAS, it is hereby officially found and determined that the meeting at which this Ordinance was passed was open to the public, and public notice of the time, place, and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code;

THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO:

SECTION 1. AMOUNT AND PURPOSE OF THE BONDS; DELEGATION OF AUTHORITY TO CERTAIN CITY OFFICIALS.

(a) Authorization to Issue General Obligation Refunding Bonds. General obligation bonds of the City are hereby authorized to be issued and delivered in the aggregate principal amount as designated by the Mayor and/or the City Manager (each a "Designated Officer") pursuant to the provisions of Section 1(b) of this Ordinance FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE ISSUER'S OUTSTANDING GENERAL OBLIGATION INDEBTEDNESS AND TO PAY FOR COSTS OF ISSUANCE.

(b) Delegation of Final Terms. As authorized by Section 1207.007, Texas Government Code, each Designated Officer is hereby authorized, appointed, and designated as an officer of the City authorized to act on behalf of the City to effect the sale of the Bonds and to establish the terms and details related to the issuance and sale of the Bonds including the total aggregate principal amount of Bonds to be issued (but in no event to exceed $72,000,000 in aggregate principal amount), the price at which the Bonds will be sold (but in no event shall the Bonds be sold at a price which would result in a net present value savings of less than 5.00% of the principal amount of the Refunded Obligations), the date of the Bonds, the aggregate principal amount of each maturity thereof, the due date of each maturity (but in no event later than February 15, 2030), the rate of interest to be borne on the principal amount of each such maturity(but in no event to exceed a net effective interest rate for all of the Bonds of 5.00% per annum),the interest payment periods, the dates, price and terms upon and at which the Bonds shall be subject to any mandatory sinking fund redemption provisions for any maturity, the method of sale of the Bonds (negotiated underwriting or competitive sale), the Underwriters (if a negotiated underwriting) or the Purchaser (if a competitive sale) and all other matters relating to the issuance, sale and delivery of the Bonds. The Designated Officer, acting for and on behalf of the City, is further authorized to (i) complete and attach Exhibit A of this Ordinance, and (ii) revise and complete the FORM OF BOND set forth in Section 5 of this Ordinance, with the final terms of the Bonds approved pursuant to the authority granted herein, and to enter into, execute and carry out an agreement to purchase the Bonds (the "Purchase Contract") with the Purchasernamed in Section 13 herein.

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(c) Delegation of Authority to Select Series 2008A Certificates and Series 2008BCertificates for Refunding. As authorized by Section 1207.007(a)(4), Texas Government Code, each Designated Officer, for and on behalf of the Issuer, is hereby authorized to select all or any portion of the Series 2008A Certificates and Series 2008B Certificates described in the recitals to this Ordinance to be refunded with proceeds of the Bonds and to evidence the selection of such Series 2008A Certificates and Series 2008B Certificates by executing and attaching to this Ordinance as Exhibit B a certificate describing the maturities and the principal amount of such maturities of the Series 2008A Certificates and Series 2008B Certificates to be refunded with the proceeds of the Bonds.

(d) Determination Required by Section 1201.022(a)(3), Texas Government Code. In satisfaction of Section 1201.022(a)(3), Texas Government Code, the City Council hereby determines that the delegation of the authority to the Designated Officer to approve the final terms of the Bonds set forth in this Ordinance is, and the decisions made by a Designated Officer pursuant to such delegated authority and incorporated in Exhibit A will be, in the City's best interests, and the Designated Officer is hereby authorized to make and include in Exhibit A an appropriate finding to that effect.

(e) Expiration of Delegation Authority. The authority delegated to a Designated Officer pursuant to Sections 1(b) and (c) above shall expire on August 1, 2016.

SECTION 2. DESIGNATION, DATE, DENOMINATIONS, NUMBERS AND MATURITIES OF BONDS. Each Bond issued pursuant to this Ordinance shall be designated: CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BOND, SERIES 2016, and initially there shall be issued, sold and delivered hereunder one fully registered bond, numbered R-1 (the "Initial Bond"), without interest coupons, dated as of the date determined by a Designated Officer and set forth in Exhibit A, and payable on the dates and in the principal installmentsdetermined by a Designated Officer and set forth in Exhibit A, with Bonds issued and delivered in substitution for the Initial Bond being in the denomination of $5,000 or any integral multiple thereof, being numbered consecutively from R-2 upward, and being payable to the initial registered owner designated in Section 13 hereof, or to the registered assignee or assignees of said Bonds or any portion or portions thereof (the "Registered Owner").

The term "Bonds" used in this Ordinance shall mean and include collectively the bonds initially issued and delivered pursuant to this Ordinance and all substitute bonds exchanged therefor, as well as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bond" shall mean any of the Bonds

SECTION 3. INTEREST. The Bonds shall bear interest calculated on the basis of a 360-day year composed of twelve 30-day months from the dates specified in the FORM OF BONDS set forth in this Ordinance to their respective dates of maturity at the rates per annum determined by a Designated Officer as set forth in Exhibit A attached hereto. Said interest shall be payable in the manner provided and on the dates stated in the FORM OF BONDS set forth in this Ordinance.

SECTION 4. CHARACTERISTICS OF THE BONDS.

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(a) Registration, Transfer, and Exchange; Authentication. The City shall keep or cause to be kept at the designated office of a paying agent to be approved by the Designated Officer (the "Paying Agent/Registrar"), books or records for the registration of the transfer and exchange of the Bonds (the "Registration Books"), and the City hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such registrations of transfers and exchanges under such reasonable regulations as the City and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such registrations, transfers and exchanges as herein provided. Attached hereto as Exhibit C is a copy of the Paying Agent/Registrar Agreement between the City and the Paying Agent/Registrar which is hereby approved in substantially final form, and the Mayor and City Secretary of the City are hereby authorized to execute the Paying Agent/Registrar Agreement and approve any changes in the final form thereof.

The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the registered owner of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each registered owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. To the extent possible and under reasonable circumstances, all transfers of Bonds shall be made within three business days after request and presentation thereof. The City shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. The Paying Agent/Registrar's standard or customary fees and charges for making such registration, transfer, exchange and delivery of a substitute Bond or Bonds shall be paid as provided in the FORM OF BONDS set forth in this Ordinance. Registration of assignments, transfers and exchanges of Bonds shall be made in the manner provided and with the effect stated in the FORM OF BONDS set forth in this Ordinance. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond.

Except as provided in (c) below, an authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the Paying Agent/Registrar's Authentication Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate is so executed. The Paying Agent/Registrar promptly shall cancel all paid Bonds and Bonds surrendered for transfer and exchange. No additional ordinances, orders, or resolutions need be passed or adopted by the governing body of the City or any other body or person so as to accomplish the foregoing transfer and exchange of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant to Sections 1201.061 through 1201.067 of the Public Securities Code, Chapter 1201, Texas Government Code, the duty of transfer and exchange of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of said Certificate, the transferred and exchanged Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Bonds which initially were issued and delivered pursuant to this Ordinance, approved by the Attorney General, and registered by the Comptroller of Public Accounts.

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(b) Payment of Bonds and Interest. The City hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, all as provided in this Ordinance. The Paying Agent/ Registrar shall keep proper records of all payments made by the City and the Paying Agent/Registrar with respect to the Bonds.

(c) In General. The Bonds (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the registered owners thereof, (ii) may be transferred and assigned, (iii) may be exchanged for other Bonds, (iv) shall have the characteristics, (v) shall be signed, sealed, executed and authenticated, (vi) the principal of and interest on the Bonds shall be payable, and (vii) shall be administered and the Paying Agent/Registrar and the City shall have certain duties and responsibilities with respect to the Bonds, all as provided, and in the manner and to the effect as required or indicated, in the FORM OF BONDS set forth in this Ordinance. The Initial Bond is not required to be, and shall not be, authenticated by the Paying Agent/ Registrar, but on each substitute Bond issued in exchange for the Initial Bond issued under this Ordinance the Paying Agent/Registrar shall execute the PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE, in the form set forth in the FORM OF BONDS. In lieu of the executed Paying Agent/Registrar’s Authentication Certificate described above, the Initial Bond delivered on the closing date (as further described in subparagraph (i) below) shall have attached thereto the Comptroller's Registration Certificate substantially in the form set forth in the FORM OF BONDS below, manually executed by the Comptroller of Public Accounts of the State of Texas or by his duly authorized agent, which certificate shall be evidence that the Initial Bond has been duly approved by the Attorney General of the State of Texas and that it is a valid and binding obligation of the City, and has been registered by the Comptroller.

(d) Substitute Paying Agent/Registrar. The City covenants with the registered owners of the Bonds that at all times while the Bonds are outstanding the City will provide a competent and legally qualified bank, trust company, financial institution, or other entity to act as and perform the services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying Agent/Registrar will be one entity and shall be an entity registered with the Securities and Exchange Commission. The City reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the City covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Registrar designated and appointed by the City. Upon any change in the Paying Agent/Registrar, the City promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar.

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(e) Book-Entry Only System for Bonds. The Bonds issued in exchange for the Bonds initially issued to the purchaser specified in Section 13 herein shall be initially issued in the form of a separate single fully registered Bond for each of the maturities thereof. Upon initial issuance, the ownership of each such Bond shall be registered in the name of Cede & Co., as nominee of The Depository Trust Company of New York ("DTC"), and except as provided in subsection (i) hereof, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC.

With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the City and the Paying Agent/Registrar shall have no responsibility or obligation to any securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations on whose behalf DTC was created ("DTC Participant") to hold securities to facilitate the clearance and settlement of securities transaction among DTC Participants or to any person on behalf of whom such a DTC Participant holds an interest in the Bonds. Without limiting the immediately preceding sentence, the City and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a registered owner of the Bonds, as shown on the Registration Books, of any notice with respect to the Bonds, or (iii) the payment to any DTC Participant or any other person, other than a registered owner of Bonds, as shown in the Registration Books of any amount with respect to principal of or interest on the Bonds. Notwithstanding any other provision of this Ordinance to the contrary, the City and the Paying Agent/Registrar shall be entitled to treat and consider the person in whose name each Bond is registered in the Registration Books as the absolute owner of such Bond for the purpose of payment of principal and interest with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The Paying Agent/Registrar shall pay all principal of and interest on the Bonds only to or upon the Ordinance of the registered owners, as shown in the Registration Books as provided in this Ordinance, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the City's obligations with respect to payment of principal of and interest on the Bonds to the extent of the sum or sums so paid. No person other than a registered owner, as shown in the Registration Books, shall receive a Bond certificate evidencing the obligation of the City to make payments of principal and interest pursuant to this Ordinance. Upon delivery by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions in this Ordinance with respect to interest checks being mailed to the registered owner at the close of business on the Record Date, the words "Cede & Co." in this Ordinance shall refer to such new nominee of DTC.

(f) Successor Securities Depository; Transfers Outside Book-Entry Only Systems. In the event that the City determines that DTC is incapable of discharging its responsibilities described herein and in the representation letter of the City to DTC or that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds, the City shall (i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the appointment of such successor securities depository and transfer one or more separate Bonds to such successor securities depository or (ii) notify DTC and DTC Participants of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds credited to their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in the Registration Books in the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities depository, or its nominee, or in whatever name or names registered owners transferring or exchanging Bonds shall designate, in accordance with the provisions of this Ordinance.

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(g) Payments to Cede & Co. Notwithstanding any other provision of this Ordinance to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee for DTC, all payments with respect to principal of and interest on such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the representation letter of the City to DTC.

(h) DTC Letter of Representation. The officers of the City are herein authorized for and on behalf of the City and as officers of the City to enter into one or more Letters of Representation, if necessary, with DTC establishing the book-entry only system with respect to the Bonds.

(i) Delivery of Initial Bond. On the closing date, one Initial Bond representing the entire principal amount of the Bonds and, payable in stated installments to the initial registered owner named in Section 13 of this Ordinance or its designee, executed by manual or facsimile signature of the Mayor or Mayor Pro-Tem and the City Secretary of the City, approved by the Attorney General of Texas, and registered and manually signed by the Comptroller of Public Accounts of the State of Texas, will be delivered to the initial purchaser or its designee. Upon payment for the Bonds, the Paying Agent/Registrar shall cancel the Initial Bond and deliver to the initial registered owner or its designee one registered definitive Bond for each year of maturity of the Bonds, in the aggregate principal amount of all of the Bonds for such maturity.

SECTION 5. FORM OF BONDS. The form of the Bonds, including the form of Paying Agent/Registrar's Authentication Certificate, the form of Assignment and the form of Registration Certificate of the Comptroller of Public Accounts of the State of Texas (to be attached only to the Bonds initially issued and delivered pursuant to this Ordinance), shall be, respectively, substantially as follows, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance.


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FORM OF BOND

R-__ Principal Amount$_____________

UNITED STATES OF AMERICASTATE OF TEXAS

COUNTY OF WEBBCITY OF LAREDO, TEXAS

GENERAL OBLIGATION REFUNDING BOND, SERIES 2016

INTEREST RATE

____%

DATE OF SERIES

March 15, 2016

MATURITY DATE

___________, 20__

CUSIP NO.

_________

REGISTERED OWNER:

PRINCIPAL AMOUNT: DOLLARS

ON THE MATURITY DATE specified above, the CITY OF LAREDO, TEXAS (the "City"), being a political subdivision and home-rule municipality of the State of Texas, hereby promises to pay to the Registered Owner set forth above, or registered assigns (hereinafter called the "Registered Owner") the Principal Amount set forth above, and to pay interest thereon from March 30, 2016, at the Interest Rate per annum specified above, on August 15, 2016, and semiannually on each February 15 and August 15 thereafter to the Maturity Date specified above; except that if this Bond is required to be authenticated and the date of its authentication is later than the first Record Date (hereinafter defined), such Principal Amount shall bear interest from the interest payment date next preceding the date of authentication, unless such date of authentication is after any Record Date but on or before the next following interest payment date, in which case such Principal Amount shall bear interest from such next following interest payment date; provided, however, that if on the date of authentication hereof the interest on the Bond or Bonds, if any, for which this Bond is being exchanged or converted from is due but has not been paid, then this Bond shall bear interest from the date to which such interest has been paid in full.

THE PRINCIPAL OF AND INTEREST ON THIS BOND are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the Registered Owner hereof upon presentation and surrender of this Bond at maturity at the designated corporate trust or commercial banking office (initially located in ________, _____________) of ________________________________________, which is the "Paying Agent/Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the Registered Owner hereof on each interest payment date by check or draft, dated as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the City required by the ordinance authorizing the issuance of the Bonds (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such interest payment date, to the Registered Owner hereof, at its address as it appeared on the last business day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described. In addition, interest may be paid by such other method, acceptable to the Paying Agent/Registrar, requested by, and at the risk and expense of, the

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Registered Owner. In the event of a non-payment of interest on a scheduled payment date, and for 30 days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the City. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five business days prior to the Special Record Date by United States mail, first-class postage prepaid, to the address of each owner of a Bond appearing on the Registration Books at the close of business on the last business day next preceding the date of mailing of such notice. The City covenants with the Registered Owner of this Bond that on or before each principal payment date and interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due.

IF THE DATE FOR ANY PAYMENT DUE on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the city where the Designated Trust Office of the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close, and payment on such date shall have the same force and effect as if made on the original date payment was due.

THIS BOND IS ONE OF A SERIES OF BONDS dated as of March 15, 2016, authorized in accordance with the Constitution and laws of the State of Texas in the principal amount of $____________ FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE ISSUER'S OUTSTANDING GENERAL OBLIGATION INDEBTEDNESS AND TO PAY FOR COSTS OF ISSUANCE.

ON FEBRUARY 15, 20__, OR ON ANY DATE THEREAFTER, the Bonds scheduled to mature on and after February 15, 20__ may be redeemed prior to their scheduled maturities, at the option of the Issuer, with funds derived from any available and lawful source, as a whole, or in part (provided that a portion of such Bond may be redeemed only in an integral multiple of $5,000 in principal amount) at the redemption price equal to the principal amount being called for redemption plus unpaid accrued interest. If less than all of such Bonds are to be redeemed, the particular Bonds to be redeemed shall be selected by the Paying Agent/Registrar at random and by lot.

AT LEAST 30 DAYS PRIOR to the date fixed for any redemption of Bonds or portions thereof prior to maturity, a written notice of such redemption shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, at least 30 days prior to the date fixed for any such redemption to the Registered Owner of each Bond to be redeemed at its address as it appeared on the Registration Books maintained by the Paying Agent/Registrar on the day such notice of redemption is mailed. Any notice of redemption so mailed shall be conclusively presumed to have been duly given irrespective of whether received by the Registered Owner. The notice with respect to an optional redemption of Bonds may state (1) that it is conditioned upon the deposit of moneys, in an amount equal to the amount necessary to effect the redemption, with the Paying Agent/Registrar no later than the redemption date, or (2) that the City retains the right to rescind such notice at any time prior to the scheduled redemption date if the City delivers a certificate of an authorized representative to the Paying Agent/Registrar instructing the Paying Agent/Registrar to rescind the redemption notice, and such notice and optional redemption shall be of no effect if such moneys are not so deposited or if the notice is so rescinded. By the date fixed for any such redemption, due provision shall be made with the Paying Agent/Registrar for the payment of the required redemption price for the Bonds or portions thereof which are to be so redeemed. If such written notice of redemption is mailed (and not rescinded), and if due provision for such payment is made, all as provided above, the Bonds or portions thereof which are to be

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so redeemed thereby automatically shall be treated as redeemed prior to their scheduled maturities, and they shall not bear interest after the date fixed for redemption, and they shall not be regarded as being outstanding except for the right of the Registered Owner to receive the redemption price from the Paying Agent/Registrar out of the funds provided for such payment. If a portion of any Bond shall be redeemed a substitute Bond or Bonds having the same maturity date, bearing interest at the same rate, in any denomination or denominations in any integral multiple of $5,000, at the written request of the Registered Owner, and in an aggregate principal amount equal to the unredeemed portion thereof, will be issued to the Registered Owner upon the surrender thereof for cancellation, at the expense of the City, all as provided in the Bond Ordinance.

ALL BONDS OF THIS SERIES are issuable solely as fully registered Bonds, without interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Ordinance, this Bond may, at the request of the Registered Owner or the assignee or assignees hereof, be assigned, transferred, converted into and exchanged for a like aggregate amount of fully registered Bonds, without interest coupons, payable to the appropriate Registered Owner, assignee or assignees, as the case may be, having any authorized denomination or denominations as requested in writing by the appropriate Registered Owner, assignee or assignees, as the case may be, upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof in any authorized denomination to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be registered. The form of Assignment printed or endorsed on this Bond may be executed by the Registered Owner to evidence the assignment hereof, but such method is not exclusive, and other instruments of assignment satisfactory to the Paying Agent/Registrar may be used to evidence the assignment of this Bond or any portion or portions hereof from time to time by the Registered Owner. The Paying Agent/Registrar's reasonable standard or customary fees and charges for assigning, transferring, converting and exchanging any Bond or portion thereof will be paid by the City. In any circumstance, any taxes or governmental charges required to be paid with respect thereto shall be paid by the one requesting such assignment, transfer, conversion or exchange, as a condition precedent to the exercise of such privilege. The Paying Agent/Registrar shall not be required to make any such transfer or exchange of a Bond during the period commencing with the close of business on any Record Date immediately preceding a principal or interest payment date for such Bond and ending with the opening of business on the next following principal or interest payment date.

WHENEVER THE BENEFICIAL OWNERSHIP of this Bond is determined by a book entry at a securities depository for the Bonds, the foregoing requirements of holding, delivering or transferring this Bond shall be modified to require the appropriate person or entity to meet the requirements of the securities depository as to registering or transferring the book entry to produce the same effect.

IN THE EVENT ANY PAYING AGENT/REGISTRAR for the Bonds is changed by the City, resigns, or otherwise ceases to act as such, the City has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, and cause written notice thereof to be mailed to the registered owners of the Bonds.

IT IS HEREBY CERTIFIED, RECITED, AND COVENANTED that this Bond has been duly and validly authorized, issued, and delivered; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance and delivery of this Bond have been performed, existed, and been done in accordance with law; that this Bond is a general obligation of the City, issued on the full faith and credit thereof; and that ad valorem taxes sufficient to

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provide for the payment of the interest on and principal of this Bond, as such interest comes due, and as such principal matures, have been levied and ordered to be levied against all taxable property in the City, and have been pledged for such payment, within the limits provided by law.

THE CITY HAS RESERVED THE RIGHT TO AMEND the Bond Ordinance as provided therein, and under some (but not all) circumstances amendments thereto must be approved by the registered owners of a majority in aggregate principal amount of the outstanding Bonds.

BY BECOMING THE REGISTERED OWNER of this Bond, the Registered Owner thereby acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the City, and agrees that the terms and provisions of this Bond and the Bond Ordinance constitute a contract between each Registered Owner hereof and the City.

IN WITNESS WHEREOF, the City has caused this Bond to be signed with the manual or facsimile signature of the Mayor or Mayor Pro-Tem of the City and countersigned with the manual or facsimile signature of the City Secretary of the City, and has caused the official seal of the City to be duly impressed, or placed in facsimile, on this Bond.

(facsimile signature) (facsimile signature) City Secretary, City of Laredo, Texas Mayor [Pro-Tem], City of Laredo, Texas

(SEAL)

FORM OF REGISTRATION CERTIFICATE OFTHE COMPTROLLER OF PUBLIC ACCOUNTS:

COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO. _____________

I hereby certify that this Bond has been examined, certified as to validity, and approved by the Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas.

Witness my signature and seal this______________________________Comptroller of Public Accounts

(COMPTROLLER'S SEAL) of the State of Texas

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FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE

PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE(To be executed if this Bond is not accompanied by an executed Registration Certificate of the Comptroller of Public Accounts of the State of Texas)

It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described in the text of this Bond; and that this Bond has been issued in conversion or replacement of, or in exchange for, a bond, bonds, or a portion of a bond or bonds of a Series which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas.

Dated ________________________________________________, _____________Paying Agent/Registrar

By________________________________Authorized Representative

FORM OF ASSIGNMENT:

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned Registered Owner of this Bond, or duly authorized representative or attorney thereof, hereby assigns this Bond to____________________________/____________________________/___________________________________________________(Assignee's Social Security or (Print or typewrite Assignee's name and address, including zip code)Taxpayer Identification)

and hereby irrevocably constitutes and appoints ________________________________________ attorney to register the transfer of the within Bond on the books kept for registration thereof, withfull power of substitution in the premises.

Dated: __________________________

Signature Guaranteed:

____________________________________NOTICE: Signature(s) must be guaranteed by a member firm of the New York Stock Exchange or a commercial bank or trust company.

____________________________________NOTICE: The signature above must correspond with the name of the Registered Owner as it appears upon the front of this Bond in every particular, without alteration or enlargement or any change whatsoever.

INITIAL BOND INSERTIONS

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The Initial Bond shall be in the form set forth above except that:

(A) Immediately under the name of the Bond, the headings "INTEREST RATE" and "MATURITY DATE" shall be completed with the words "As shown below" and "CUSIP NO. _____" shall be deleted.

(B) The first paragraph shall be deleted and the following shall be inserted:

"ON THE RESPECTIVE MATURITY DATES specified below, the CITY OF LAREDO, TEXAS (the "City"), being a political subdivision and home-rule municipality of the State of Texas, hereby promises to pay to the Registered Owner specified above, or registered assigns (hereinafter called the "Registered Owner"), the respective Principal Installments specified below, and to pay interest thereon (calculated on the basis of a 360-day year composed of twelve 30-day months) from March 30, 2016 at the respective Interest Rates per annum specified below, payable on August 15, 2016, and semiannually on each February 15 and August 15 thereafter to the respective Maturity Dates specified below. The respective Maturity Dates, Principal Installments and Interest Rates for this Bond are set forth in the following schedule:

MATURITY DATE

PRINCIPAL

INSTALLMENT ($)INTEREST

RATE (%)

_____ ________ _____

_____ ________ _____

_____ ________ _____

[Insert information from Exhibit A]

(C) The Initial Bond shall be numbered "T-1."

SECTION 6. INTEREST AND SINKING FUND; TAX LEVY; SECURITY INTEREST.

(a) Interest and Sinking Fund; Tax Levy. A special "Interest and Sinking Fund" is hereby created and shall be established and maintained by the City at an official depository bank of the City. Said Interest and Sinking Fund shall be kept separate and apart from all other funds and accounts of the City, and shall be used only for paying the interest on and the principal of said Bonds. Immediately after the issuance and delivery of the Bonds, all accrued interest on the Bonds, together with any premium on the Bonds that is not used by the City to pay costs of issuance in accordance with the provisions of Section 1201.042(d), Texas Government Code, as amended, shall be deposited to the credit of the Interest and Sinking Fund. In addition, all ad valorem taxes levied and collected for and on account of said Bonds shall be deposited, as collected, to the credit of said Interest and Sinking Fund. For each fiscal year while any of the Bonds or interest thereon are outstanding and unpaid, the governing body of the City shall compute and ascertain a rate and amount of ad valorem tax which will be sufficient to raise and produce the money required to pay the interest on the Bonds as such interest comes due, and to provide and maintain a sinking fund adequate to pay the principal of the Bonds as such principal

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matures (but never less than 2% of the original principal amount of the Bonds as a sinking fund each year); and said tax shall be based on the latest approved tax rolls of the City, with full allowance being made for tax delinquencies and the cost of tax collection. Said rate and amount of ad valorem tax is hereby levied, and is hereby ordered to be levied, against all taxable property in the City for each year while any of the Bonds or interest thereon are outstanding and unpaid; and said tax shall be assessed and collected each such year and deposited to the credit of the Interest and Sinking Fund created by this Ordinance. Said ad valorem taxes sufficient to provide for the payment of the interest on and principal of the Bonds, as such interest comes due and such principal matures, are hereby pledged for such payment, within the limit prescribed by law.

(b) Security Interest. Chapter 1208, Texas Government Code, applies to the issuance of the Bonds and the pledge of the ad valorem taxes granted by the City under Section 6(a) of this Ordinance, and is therefore valid, effective, and perfected. If Texas law is amended at any time while the Bonds are outstanding and unpaid such that the pledge of the ad valorem taxes granted by the City under Section 6(a) of this Ordinance is to be subject to the filing requirements of Chapter 9, Texas Business & Commerce Code, then in order to preserve to the registered owners of the Bonds the perfection of the security interest in said pledge, the City agrees to take such measures as it determines are reasonable and necessary under Texas law to comply with the applicable provisions of Chapter 9, Texas Business & Commerce Code, and enable a filing to perfect the security interest in said pledge to occur.

SECTION 7. INVESTMENTS. Funds on deposit in the Interest and Sinking Fund shall be secured by the depository bank of the City in the manner and to the extent required by law to secure other public funds of the City and may be invested from time to time in any investment authorized by applicable law, including but not limited to the Public Funds Investment Act (Chapter 2256, Texas Government Code), and the City's investment policy adopted in accordance with the provisions of the Public Funds Investment Act; provided, however, that investments purchased for and held in the Interest and Sinking Fund shall have a final maturity no later than the next principal or interest payment date on which such funds will be needed. Income and profits from such investments shall be deposited in the Interest and Sinking Fund. It is further provided, however, that any interest earnings on proceeds which are required to be rebated to the United States of America pursuant to Section 11 hereof in order to prevent the Bonds from being arbitrage bonds shall be so rebated and not considered as interest earnings for the purposes of this Section.

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SECTION 8. DEFEASANCE OF BONDS.

(a) Defeasance. Any Bond and the interest thereon shall be deemed to be paid, retired and no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the extent provided in subsection (d) of this Section, when payment of the principal of such Bond, plus interest thereon to the due date (whether such due date be by reason of maturity or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof, or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar in accordance with an escrow agreement or other instrument (the "Future Escrow Agreement") for such payment (1) lawful money of the United States of America sufficient to make such payment and/or (2) Defeasance Securities that mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money to provide for such payment, and when proper arrangements have been made by the City with the Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the ad valorem taxes herein levied and pledged as provided in this Ordinance, and such principal and interest shall be payable solely from such money or Defeasance Securities.

(b) Investment of Funds in Defeasance Securities. Any moneys so deposited with the Paying Agent/Registrar may at the written direction of the City be invested in Defeasance Securities, maturing in the amounts and times as hereinbefore set forth, and all income from such Defeasance Securities received by the Paying Agent/Registrar that is not required for the payment of the Bonds and interest thereon, with respect to which such money has been so deposited, shall be turned over to the City, or deposited as directed in writing by the City. Any Future Escrow Agreement pursuant to which the money and/or Defeasance Securities are held for the payment of Defeased Bonds may contain provisions permitting the investment or reinvestment of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the requirements specified in subsection (a)(i) or (ii) of this Section. All income from such Defeasance Securities received by the Paying Agent/Registrar which is not required for the payment of the Defeased Bonds, with respect to which such money has been so deposited, shall be remitted to the City or deposited as directed in writing by the City.

(c) Definition of Defeasance Securities. The term "Defeasance Securities" means (i) direct, noncallable obligations of the United States of America, including obligations that are unconditionally guaranteed by the United States of America, (ii) noncallable obligations of an agency or instrumentality of the United States of America, including obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date of the purchase thereof are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, (iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the date on the date the governing body of the City adopts or approves the proceedings authorizing the financial arrangements are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, and (iv) any other then authorized securities or obligations under applicable state law that may be used to defease obligations such as the Bonds.

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(d) Duties of Paying Agent/Registrar. Until all Defeased Bonds shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bonds the same as if they had not been defeased, and the City shall make proper arrangements to provide and pay for such services as required by this Ordinance.

(e) Selection of Certificates of Obligation to be Defeased. In the event that the City elects to defease less than all of the principal amount of Bonds of a maturity, the Paying Agent/Registrar shall select, or cause to be selected, such amount of Bonds by such random method as it deems fair and appropriate.

SECTION 9. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS.

(a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new bond of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided.

(b) Application for Replacement Bonds. Application for replacement of damaged, mutilated, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the registered owner applying for a replacement bond shall furnish to the City and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto. Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall furnish to the City and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or mutilated.

(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has occurred which is then continuing in the payment of the principal of or interest on the Bond, the City may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section.

(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the City whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance.

(e) Authority for Issuing Replacement Bonds. In accordance with Chapter 1201, Texas Government Code, as amended, this Section of this Ordinance shall constitute authority for the

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issuance of any such replacement bond without necessity of further action by the governing body of the City or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bonds in the form and manner and with the effect, as provided in Section 4(a) of this Ordinance for Bonds issued in conversion and exchange for other Bonds.

SECTION 10. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION; CUSIP NUMBERS; AND OTHER MATTERS. The Mayor or Mayor Pro-Tem of the City is hereby authorized to have control of the Bonds initially issued and delivered hereunder and all necessary records and proceedings pertaining to the Bonds pending their delivery and their investigation, examination, and approval by the Attorney General of the State of Texas, and their registration by the Comptroller of Public Accounts of the State of Texas. Upon registration of the Bonds said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate attached to such Bonds, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Certificate. The approving legal opinion of the City's Bond Counsel (with an appropriate certificate pertaining thereto executed by facsimile signature of the City Secretary of the City) may, at the option of the City, be printed on the Bonds issued and delivered under this Ordinance, but neither shall have any legal effect, and shall be solely for the convenience and information of the registered owners of the Bonds. In addition, if bond insurance is obtained, the Bonds may bear an appropriate legend as provided by the insurer.

SECTION 11. COVENANTS REGARDING TAX EXEMPTION OF INTEREST ON THE BONDS.

(a) Covenants. The City covenants to take any action necessary to assure, or refrain from any action which would adversely affect, the treatment of the Bonds as obligations described in section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), the interest on which is not includable in the "gross income" of the holder for purposes of federal income taxation. In furtherance thereof, the City covenants as follows:

(1) to take any action to assure that no more than 10 percent of the proceeds of the Bonds or the Refunded Obligations or the projects financed or refinanced therewith (less amounts deposited to a reserve fund, if any) are used for any "private business use," as defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds of the Bonds or the Refunded Obligations or the projects financed or refinanced therewithare so used, such amounts, whether or not received by the City, with respect to such private business use, do not, under the terms of this Ordinance or any underlying arrangement, directly or indirectly, secure or provide for the payment of more than 10 percent of the debt service on the Bonds, in contravention of section 141(b)(2) of the Code;

(2) to take any action to assure that in the event that the "private business use" described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the Refunded Obligations or the projects financed or refinanced therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of 5 percent is used for a "private business use" which is "related" and not "disproportionate," within the meaning of section 141(b)(3) of the Code, to the governmental use;

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(3) to take any action to assure that no amount which is greater than the lesser of $5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve fund, if any) is directly or indirectly used to finance loans to persons, other than state or local governmental units, in contravention of section 141(c) of the Code;

(4) to refrain from taking any action which would otherwise result in the Bonds being treated as "private activity bonds" within the meaning of section 141(b) of the Code;

(5) to refrain from taking any action that would result in the Bonds being "federally guaranteed" within the meaning of section 149(b) of the Code;

(6) to refrain from using any portion of the proceeds of the Bonds, directly or indirectly, to acquire or to replace funds which were used, directly or indirectly, to acquire investment property (as defined in section 148(b)(2) of the Code) which produces a materially higher yield over the term of the Bonds, other than investment property acquired with --

(A) proceeds of the Bonds invested for a reasonable temporary period of three years or less or, in the case of a refunding bond, for a period of thirty days or less until such proceeds are needed for the purpose for which the Bonds are issued,

(B) amounts invested in a bona fide debt service fund, within the meaning of section l.148-1(b) of the Treasury Regulations, and

(C) amounts deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed 10 percent of the proceeds of the Bonds;

(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (relating to advance refundings); and

(8) to pay to the United States of America at least once during each five-year period (beginning on the date of delivery of the Bonds) an amount that is at least equal to 90 percent of the "Excess Earnings," within the meaning of section 148(f) of the Code and to pay to the United States of America, not later than 60 days after the Bonds have been paid in full, 100 percent of the amount then required to be paid as a result of Excess Earnings under section 148(f) of the Code.

(b) Rebate Fund. In order to facilitate compliance with the above covenant (8), a "Rebate Fund" is hereby established by the City for the sole benefit of the United States of America, and such fund shall not be subject to the claim of any other person, including without limitation the bondholders. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code.

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(c) Proceeds. The City understands that the term "proceeds" includes "disposition proceeds" as defined in the Treasury Regulations and, in the case of refunding bonds, transferred proceeds (if any) and proceeds of the refunded bonds expended prior to the date of issuance of the Bonds. It is the understanding of the City that the covenants contained herein are intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S. Department of the Treasury pursuant thereto. In the event that regulations or rulings are hereafter promulgated which modify or expand provisions of the Code, as applicable to the Bonds, the City will not be required to comply with any covenant contained herein to the extent that such failure to comply, in the opinion of nationally recognized bond counsel, will not adversely affect the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In the event that regulations or rulings are hereafter promulgated which impose additional requirements which are applicable to the Bonds, the City agrees to comply with the additional requirements to the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In furtherance of such intention, the City hereby authorizes and directs the Mayor, the City Manager and the Director of Finance of the City to execute any documents, certificates or reports required by the Code and to make such elections, on behalf of the City, which may be permitted by the Code as are consistent with the purpose for the issuance of the Bonds.

(d) Allocation of, and Limitation on, Expenditures for the Project. The City covenants to account for the expenditure of sale proceeds and investment earnings to be used for the purposes described in Section 1 of this Ordinance on its books and records in accordance with the requirements of the Internal Revenue Code. The City recognizes that in order for the proceeds to be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18 months of the later of the date that (1) the expenditure is made, or (2) the project is completed; but in no event later than three years after the date on which the original expenditure is paid. The foregoing notwithstanding, the Issuer recognizes that in order for proceeds to be expended under the Internal Revenue Code, the sale proceeds or investment earnings must be expended no more than 60 days after the earlier of (1) the fifth anniversary of the delivery of the Bonds, or (2) the date the Bonds are retired. The City agrees to obtain the advice of nationally-recognized bond counsel if such expenditure fails to comply with the foregoing to assure that such expenditure will not adversely affect the tax-exempt status of the Bonds. For purposes hereof, the City shall not be obligated to comply with this covenant if it obtains an opinion that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest.

(e) Disposition of Project. The City covenants that the property constituting the projects financed or refinanced with the proceeds of the Bonds will not be sold or otherwise disposed in a transaction resulting in the receipt by the City of cash or other compensation, unless the City obtains an opinion of nationally-recognized bond counsel that such sale or other disposition will not adversely affect the tax-exempt status of the Bonds. For purposes of the foregoing, the portion of the property comprising personal property and disposed in the ordinary course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For purposes hereof, the City shall not be obligated to comply with this covenant if it obtains an opinion that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest.

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(f) Written Procedures. Unless superseded by another action of the City, to ensure compliance with the covenants contained herein regarding private business use, remedial actions, arbitrage and rebate, the City Council hereby adopts and establishes the instructions attached hereto as Exhibit D as the City's written procedures.

SECTION 12. COMPLIANCE WITH RULE 15c2-12.

(a) Definitions. As used in this Section, the following terms have the meanings ascribed to such terms below:

"EMMA" means the Electronic Municipal Market Access system being established by the MSRB.

"MSRB" means the Municipal Securities Rulemaking Board.

"Rule" means SEC Rule 15c2-12, as amended from time to time.

"SEC" means the United States Securities and Exchange Commission.

(b) Annual Reports. The City shall provide annually to the MSRB through EMMA within six months after the end of each fiscal year ending in or after 2014, financial information and operating data with respect to the City of the general type included in the final Official Statement authorized by this Ordinance being the information described in Exhibit E hereto. Any financial statements so to be provided shall be (1) prepared in accordance with the accounting principles described in Exhibit D hereto, or such other accounting principles as the City may be required to employ from time to time pursuant to state law or regulation, and (2) audited, if the City commissions an audit of such statements and the audit is completed within the period during which they must be provided. If the audit of such financial statements is not complete within such period, then the City shall provide (1) unaudited financial statements for such fiscal year within such six month period, and (2) audited financial statements for the applicable fiscal year to the MSRB through EMMA when and if the audit report on such statements become available.

If the City changes its fiscal year, it will notify the MSRB through EMMA of the date of the new fiscal year end prior to the next date by which the City otherwise would be required to provide financial information and operating data pursuant to this paragraph (b).

The financial information and operating data to be provided pursuant to this paragraph (b) may be set forth in full in one or more documents or may be included by specific reference to any document (including an official statement or other offering document, if it is available from the MSRB) that theretofore has been provided to the MSRB through EMMA or filed with the SEC.

(c) Event Notices.

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(i) The City shall notify the MSRB through EMMA in an electronic format as prescribed by the MSRB, in a timely manner (but not in excess of ten business days after the occurrence of the event) of any of the following events with respect to the Bonds, if such event is material within the meaning of the federal securities laws:

1. Non-payment related defaults;

2. Modifications to rights of holders;

3. Redemption calls;

4. Release, substitution, or sale of property securing repayment of the Bonds;

5. The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; and

6. Appointment of a successor or additional trustee or the change of name of a trustee.

(ii) The City shall notify the MSRB through EMMA in an electronic format as prescribed by the MSRB, in a timely manner (but not in excess of ten business days after the occurrence of the event) of any of the following events with respect to the Bonds, without regard to whether such event is considered material within the meaning of the federal securities laws:

1. Principal and interest payment delinquencies;

2. Unscheduled draws on debt service reserves reflecting financial difficulties;

3. Unscheduled draws on credit enhancements reflecting financial difficulties;

4. Substitution of credit or liquidity providers, or their failure to perform;

5. Adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701–TEB) or other material notices or determinations with respect to the tax-exempt status of the Bonds, or other events affecting the tax-exempt status of the Bonds;

6. Tender offers;

7. Defeasances;

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8. Rating changes; and

9. Bankruptcy, insolvency, receivership or similar event of an obligated person.

(iii) The City shall notify the MSRB through EMMA, in a timely manner, of any failure by the City to provide financial information or operating data in accordance with subsection (b) of this Section by the time required by such subsection.

(d) Limitations, Disclaimers, and Amendments. The City shall be obligated to observe and perform the covenants specified in this Section for so long as, but only for so long as, the City remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except that the City in any event will give notice of any deposit made in accordance with Section 11 of this Ordinance that causes Bonds no longer to be outstanding.

The provisions of this Section are for the sole benefit of the holders and beneficial owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or equitable right, remedy, or claim hereunder to any other person. The City undertakes to provide only the financial information, operating data, financial statements, and notices which it has expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any other information that may be relevant or material to a complete presentation of the City's financial results, condition, or prospects or hereby undertake to updateany information provided in accordance with this Section or otherwise, except as expressly provided herein. The City does not make any representation or warranty concerning such information or its usefulness to a decision to invest in or sell Bonds at any future date.

UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR BENEFICIAL OWNER OF ANY BOND OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE CITY, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.

No default by the City in observing or performing its obligations under this Section shall comprise a breach of or default under this Ordinance for purposes of any other provision of this Ordinance.

Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties of the City under federal and state securities laws.

The provisions of this Section may be amended by the City from time to time to adapt to changed circumstances that arise from a change in legal requirements, a change in law, or achange in the identity, nature, status, or type of operations of the City, but only if (1) the provisions of this Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the primary offering of the Bonds in compliance with the Rule, taking into account

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any amendments or interpretations of the Rule since such offering as well as such changed circumstances and (2) either (a) the holders of a majority in aggregate principal amount (or any greater amount required by any other provision of this Ordinance that authorizes such an amendment) of the outstanding Bonds consent to such amendment or (b) a person that is unaffiliated with the City (such as nationally recognized bond counsel) determined that such amendment will not materially impair the interest of the holders and beneficial owners of the Bonds. The City may also amend or repeal the provisions of this continuing disclosure agreement if the SEC amends or repeals the applicable provision of the Rule or a court of final jurisdiction enters judgment that such provisions of the Rule are invalid, but only if and to the extent that the provisions of this sentence would not prevent an underwriter from lawfully purchasing or selling Bonds in the primary offering of the Bonds. If the City so amends the provisions of this Section, it shall include with any amended financial information or operating data next provided in accordance with paragraph (b) of this Section an explanation, in narrative form, of the reason for the amendment and of the impact of any change in the type of financial information or operating data so provided.

SECTION 13. SALE OF BONDS. The Bonds are hereby authorized to be sold and shall be delivered to underwriters, to be selected by the Designated Officer, (the "Underwriters") of the Bonds at a price determined by a Designated Officer as set forth in Exhibit A attached hereto, and pursuant to the terms and provisions of a Purchase Contract in the form approved by a Designated Officer, which each Designated Officer is hereby authorized and directed to execute and deliver. The City will initially deliver to the Underwriters the Initial Bond described in Section 2 hereof, which shall be registered in the name of ________________.

SECTION 14. APPROVAL OF OFFICIAL STATEMENT. The City hereby authorizes the Mayor and the City Manager to approve the form and content of an Official Statement relating to the Bonds and any addenda, supplement, or amendment thereto, and to approve the distribution of the Official Statement in the reoffering of the Bonds by the Underwriters in final form, with such changes therein or additions thereto as the officer executing the same may deem advisable, such determination to be conclusively evidenced by his execution thereof. The preparation, distribution and use of a Preliminary Official Statement for the Bonds is also hereby approved.

SECTION 15. APPROVAL OF ESCROW AGREEMENT; REFUNDING OF REFUNDED OBLIGATIONS. Concurrently with the initial delivery of the Bonds the City shall deposit an amount from the proceeds from the sale of the Bonds and other available funds of the City, if required, with the Escrow Agent, sufficient to provide for the refunding of the Refunded Obligations, all in accordance with Chapter 1207. Attached hereto as Exhibit F is an Escrow Agreement between the City and the Escrow Agent, which is hereby approved in substantially final form, and the Mayor or Mayor Pro-Tem and City Secretary of the City are hereby authorized, for and on behalf of the City, to approve any changes in the Escrow Agreement from the form attached hereto and to execute the Escrow Agreement in final form.

SECTION 16. REDEMPTION OF REFUNDED OBLIGATIONS. There is attached to this Ordinance as Exhibit G, and made a part hereof for all purposes, a NOTICE OF REDEMPTION for each series of the Refunded Obligations. (The Designated Officer and the City Secretary are authorized to substitute a revised Exhibit F to reflect the actual maturities and principal amount of such maturities of the Refunded Obligations that are selected by a

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Designated Officer to be refunded.) The City hereby exercises its option to redeem prior to maturity the Refunded Obligations described in each NOTICE OF REDEMPTION, and the Refunded Obligations are hereby called for redemption, and shall be redeemed, prior to maturity, on the date, at the place, and at the price set forth respectively therein.

As soon as practicable after the delivery of the Bonds, and in no event less than 30 days prior to the date set for redemption, a copy of each respective NOTICE OF REDEMPTION shall be sent to all registered owners of the respective Refunded Obligations by first class mail postage prepaid, addressed to such registered owners at their respective addresses shown on the registration books of the paying agent/registrar for such Refunded Obligations. In addition, as soon as practicable after the issuance and delivery of the Bonds, a copy of each respective NOTICE OF REDEMPTION shall be filed with the MSRB through EMMA in order to comply with the City's requirements under the Rule to provide notice of the occurrence of certain material events.

SECTION 17. RESERVED.

SECTION 18. AUTHORITY FOR OFFICERS TO EXECUTE DOCUMENTS AND APPROVE CHANGES. The Mayor, Mayor Pro-Tem, City Secretary, City Manager and Director of Finance of the City shall be and they are hereby expressly authorized, empowered, and directed from time to time and at any time to do and perform all such acts and things and to execute, acknowledge, and deliver in the name and under the corporate seal and on behalf of the City all such instruments, whether or not herein mentioned, as may be necessary or desirable in order to carry out the terms and provisions of this Ordinance, the Bonds, the sale of the Bonds, the Official Statement, and the Paying Agent/Registrar Agreement. In addition, prior to the initial delivery of the Bonds, the Mayor, Mayor Pro-Tem, City Secretary, City Manager, Director of Finance, City Attorney and Bond Counsel are hereby authorized and directed to approve any technical changes or correction to this Ordinance or to any of the instruments authorized and approved by this Ordinance necessary in order to (i) correct any ambiguity or mistake or properly or more completely document the transactions contemplated and approved by this Ordinance and as described in the Official Statement, (ii) obtain a rating from any of the national bond rating agencies or satisfy any requirements of the provider of a municipal bond insurance policy, if any, or (iii) obtain the approval of the Bonds by the Attorney General's office. In case any officer whose signature shall appear on any Bond shall cease to be such officer before the delivery of such Bond, such signature shall nevertheless be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery.

SECTION 19. ORDINANCE A CONTRACT; AMENDMENTS. This Ordinance shall constitute a contract with the registered owners of the Bonds, binding on the City and its successors and assigns, and shall not be amended or repealed by the City as long as any Bond remains outstanding except as permitted in this Section. The City may, with prior written notice to the Insurer but without the consent of or notice to any registered owners, amend, change, or modify this Ordinance as may be required (i) by the provisions hereof, (ii) for the purpose of curing any ambiguity, inconsistency, or formal defect or omission herein, or (iii) in connection with any other change which is not to the prejudice of the registered owners. The City may, with the written consent of the Insurer and the registered owners of a majority in aggregate principal amount of the Bonds then outstanding affected thereby, amend, change, modify, or rescind any provisions of this Ordinance; provided that without the consent of the Insurer and all of the

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registered owners affected, no such amendment, change, modification, or rescission shall (i) extend the time or times of payment of the principal of and interest on the Bonds, reduce the principal amount thereof or the rate of interest thereon, (ii) give any preference to any Bond over any other Bond, (ii) extend any waiver of default to subsequent defaults, or (iv) reduce the aggregate principal amount of Bonds required for consent to any such amendment, change, modification, or rescission. Whenever the City shall desire to make any amendment or addition to or rescission of this Ordinance requiring consent of the registered owners, the City shall cause notice of the amendment, addition, or rescission to be sent by first class mail, postage prepaid, to the registered owners at the respective addresses shown on the Registration Books and to the Insurer. Whenever at any time within one year after the date of the giving of such notice, the City shall receive an instrument or instruments in writing executed by the Insurer and the registered owners of a majority in aggregate principal amount of the Bonds then outstanding affected by any such amendment, addition, or rescission requiring the consent of the Insurer and the registered owners, which instrument or instruments shall refer to the proposed amendment, addition, or rescission described in such notice and shall specifically consent to and approve the adoption thereof in substantially the form of the copy thereof referred to in such notice, thereupon, but not otherwise, the City may adopt such amendment, addition, or rescission in substantially such form, except as herein provided. No Registered Owner may thereafter object to the adoption of such amendment, addition, or rescission, or to any of the provisions thereof, and such amendment, addition, or rescission shall be fully effective for all purposes.

SECTION 20. INTERESTED PARTIES. Nothing in this Ordinance expressed or implied is intended or shall be construed to confer upon, or to give to, any person or entity, other than the City and the registered owners of the Bonds, any right, remedy or claim under or by reason of this Ordinance or any covenant, condition or stipulation hereof, and all covenants, stipulations, promises and agreements in this Ordinance contained by and on behalf of the City shall be for the sole and exclusive benefit of the City and the registered owners of the Bonds.

SECTION 21. REMEDIES IN EVENT OF DEFAULT. In addition to all the rights and remedies provided by the laws of the State of Texas, it is specifically covenanted and agreed particularly that in the event the City (i) defaults in the payment of the principal, premium, if any, or interest on the Bonds, (ii) defaults in the deposits and credits required to be made to the Interest and Sinking Fund, or (iii) defaults in the observance or performance of any other of the covenants, conditions or obligations set forth in this Ordinance and the continuation thereof for 30 days after the City has received written notice of such defaults, the holders of any of the Bonds shall be entitled to seek a writ of mandamus issued by a court of proper jurisdiction compelling and requiring the governing body of the City and other officers of the City to observe and perform any covenant, condition or obligation prescribed in this Ordinance. Notwithstanding the foregoing, the Insurer shall have the right to direct all remedies upon an event of default, and the Insurer shall be recognized as the registered owner of the Bonds for the purposes of exercising all rights and privileges available to the holders.

No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver of any such default or acquiescence therein, and every such right and power may be exercised from time to time and as often as may be deemed expedient. The specific remedy herein provided shall be cumulative of all other existing remedies, and the specification of such remedy shall not be deemed to be exclusive.

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SECTION 22. APPROPRIATION TO PAY PRINCIPAL AND INTEREST. The City Council hereby finds that there are sufficient funds available to pay the principal and interest on the Bonds coming due on February 15, 2016 and the interest on the Bonds coming due on August 15, 2016 and hereby directs the Director of Finance to transfer on or before such dates available funds to the Interest and Sinking Fund in an amount sufficient to pay the principal and interest coming due on such date.

SECTION 23. INCORPORATION OF RECITALS. The City hereby finds that the statements set forth in the recitals of this Ordinance are true and correct, and the City hereby incorporates such recitals as a part of this Ordinance.

SECTION 24. SEVERABILITY. If any provision of this Ordinance or the application thereof to any circumstance shall be held to be invalid, the remainder of this Ordinance and the application thereof to other circumstances shall nevertheless be valid, and this governing body hereby declares that this Ordinance would have been enacted without such invalid provision.

SECTION 25. AMENDMENT TO BUDGET. It is hereby officially found and determined that the annual budget for this year is hereby amended to appropriate the proceeds from the Bonds for the purposes authorized herein.

Section 26. EFFECTIVE DATE. Pursuant to the provisions of Section 1201.028, Texas Government Code, this Ordinance shall become effective immediately after its adoption by the City Council.

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PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS AT A REGULAR MEETING HELD ON THIS 1st DAY OF FEBRUARY, 2016.

Mayor, City of Laredo, Texas

ATTEST:

City Secretary, City of Laredo, Texas

(CITY SEAL)


By:City Attorney

** ** ** ** **

EXECUTION PAGE TO THE ORDINANCE AUTHORIZING THE ISSUANCE OF

CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2016

A-1

EXHIBIT A

FORM OF APPROVAL CERTIFICATE

CERTIFICATE APPROVING THE FINAL TERMS OF THE BONDS

I, the City Manager of the CITY OF LAREDO, TEXAS (the "City"), pursuant to authority granted by the provisions of Section 1207.007, Texas Government Code, and by the City Council of the City in Section 1(b) of an ordinance approved by the City Council on February 1, 2016, relating to the issuance of the Bonds defined below (the "Ordinance"), hereby certify as follows:

1. GENERAL. This Certificate is given in connection with the issuance by the City of the CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2016 (the "Bonds") which, pursuant to the Ordinance, have been authorized by the City Council.

2. DEFINITIONS. All capitalized terms used in this Certificate which are not otherwise defined herein shall have the same meanings as set forth in the Ordinance.

3. DATED DATE AND AGGREGATE PRINCIPAL AMOUNT. The Bonds shall be dated ______________, 2016, and shall be issued in the aggregate principal amount of $____________.

4. PRINCIPAL AMOUNTS AND INTEREST RATES. The Bonds shall (i) mature on February 15 in each of the years and in the respective principal amounts, and (ii) bear interest from March 30, 2016, to their respective date of maturity at the respective interest rates, all as set forth below:

CITY OF LAREDO, TEXASGENERAL OBLIGATION REFUNDING BONDS, SERIES 2016

MATURITY

DATE

PRINCIPAL

AMOUNT ($)INTEREST

RATE (%)MATURITY

DATE

PRINCIPAL

AMOUNT ($)INTEREST

RATE (%)

A-2

5. INTEREST ON BONDS. As provided in Section 4 of the Ordinance and in the FORM OF BONDS contained in Section 5 of the Ordinance, interest on the Bonds shall be payable on each February 15 and August 15, commencing on ___________, until stated maturity or redemption.

6. OPTIONAL REDEMPTION. The Bonds maturing on and after February 15, 20__, may be redeemed prior to their scheduled maturities, at the option of the City on February15, 20__, or on any date thereafter at the redemption price equal to par plus accrued interest to the date fixed for redemption.

7. Initial Purchaser and Purchase Price. The Bonds shall be sold to __________________ as the initial purchaser thereof pursuant to [a negotiated underwriting] and shall be purchased at a price equal to $________________ (which amount is equal to par, [plus][less] a net original issue [premium][discount] on the Bonds of $______________, less Purchaser' discount of $______________), and no accrued interest. The Initial Bond shall be registered in the name of ___________________.

8. DETERMINATION OF DEBT SERVICE SAVINGS. Pursuant to the Ordinance, the City Council authorized the issuance of the Bonds in order to "achieve a gross debt service savings and a net present value debt service savings for the benefit of the taxpayers of the City; provided, however, in no event shall Bonds be issued unless the City is able to achieve a net present value debt service savings of at least 5.00% of the principal of the Refunded Obligations." The final terms of the Bonds as set forth in this Certificate have achieved such purpose, for the issuance of the Bonds will result in a gross debt service savings of $______________ and a present value debt service savings of $____________(_______________% of the principal amount of the Refunded Obligations), after taking into account the application of accrued interest on the Bonds in the amount of $______________.

9. PAYING AGENT/REGISTRAR AND ESCROW AGENT. ___________, is hereby appointed to serve as the paying agent/registrar for the Bonds and as escrow agent for the Refunded Obligations.

10. DETERMINATION REQUIRED BY SECTION 1201.022(A)(3), TEXAS GOVERNMENT

CODE. In satisfaction of Section 1201.022(a)(3), Texas Government Code, as authorized by Section 1(d) of the Ordinance, and upon consultation with the City's Financial Advisor, the undersigned hereby determines that the final terms of the Bonds as set forth in this Certificate are in the City's best interests.


A-3

APPROVED BY CITY MANAGER OF THE CITY OF LAREDO, TEXAS ON THE_____ DAY OF ____________, 2016 IN ACCORDANCE WITH SECTION 1(B) OF THEORDINANCE.

_____________________________________________________, [Mayor or City Manager]CITY OF LAREDO, TEXAS

SIGNATURE PAGE TO CERTIFICATE APPROVING FINAL TERMS OF THE

CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2016

EXHIBIT B

FORM OF CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

I, the City Manager of the CITY OF LAREDO, TEXAS (the "City"), pursuant to authority granted by the provisions of Section 1207.007(a)(4), Texas Government Code, and by the City Council of the City in Section 1(c) of an ordinance approved by the City Council of the City on February 1, 2016, relating to the issuance of the Bonds defined below (the "Ordinance"), hereby certify as follows:

1. This Certificate is given in connection with the issuance by the City of the CITY OF LAREDO, TEXAS GENERAL OBLIGATION REFUNDING BONDS, SERIES 2016 (the "Bonds") which, pursuant to the Ordinance, have been authorized by the City Council.

2. All capitalized terms used in this Certificate which are not otherwise defined herein shall have the same meanings as set forth in the Ordinance.

3. Pursuant to Section 1(c) of the Ordinance, the City Council authorized the undersigned, as the City Manager of the City, to select to be refunded with proceeds of the Bonds all or a portion of the following outstanding obligations:

Series 2008A Certificates maturing in the years 2016 through 2028Series 2008B Certificates maturing in the years 2016 through 2028, inclusive,

and 2033

In accordance with such authority, and after consulting with the City's financial advisors, [I][we] hereby determine and approve the following Series 2008A Certificates and Series 2008BCertificates to be refunded with proceeds of the Bonds, which are described as follows:

APPROVED BY THE CITY MANAGER OF THE CITY OF LAREDO, TEXAS ON THE ____ DAY OF ____________, 2016, IN ACCORDANCE WITH SECTION 1(c) OF THE ORDINANCE.


SIGNATURE PAGE TO CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

EXHIBIT C

FORM OF PAYING AGENT REGISTRAR AGREEMENT

THE PAYING AGENT/REGISTRAR AGREEMENT IS OMITTED AT THIS POINT AS IT APPEARS ELSEWHERE IN THIS TRANSCRIPT OF PROCEEDINGS

EXHIBIT D

WRITTEN PROCEDURES RELATING TO CONTINUING COMPLIANCE WITH FEDERAL TAX COVENANTS

A. Arbitrage. With respect to the investment and expenditure of the proceeds of the Bonds, the City's chief financial officer (the "Responsible Person"), which currently is the City's Director of Finance, will:

(i) monitor all amounts deposited into a sinking fund or funds (e.g., the Interest and Sinking Fund), to assure that the maximum amount invested at a yield higher than the yield on the Bonds does not exceed an amount equal to the debt service on the Bonds in the succeeding 12 month period plus a carryover amount equal to one-twelfth of the principal and interest payable on the Bonds for the immediately preceding 12-month period;

(ii) monitor the actions of the Escrow Agent to ensure compliance with the applicable provisions of the Escrow Agreement, including with respect to reinvestment of cash balances;

(iii) ensure that the applicable information return (e.g., IRS Form 8038-G, 8038-GC, or any successor forms) is timely filed with the IRS; and

(iv) assure that, unless excepted from rebate and yield restriction under section 148(f) of the Code, excess investment earnings are computed and paid to the U.S. government at such time and in such manner as directed by the IRS (A) at least every 5 years after the date of delivery of the Bonds (the "Issue Date"), and (B) within 30 days after the date the Bonds are retired.

B. Private Business Use. With respect to the use of the facilities financed or refinanced with the proceeds of the Bonds the Responsible Person will:

(i) monitor the date on which the facilities are substantially complete and available to be used for the purpose intended;

(ii) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has any contractual right (such as a lease, purchase, management or other service agreement) with respect to any portion of the facilities;

(iii) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has a right to use the output of the facilities (e.g., water, gas, electricity);

(iv) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has a right to use the facilities to conduct or to direct the conduct of research;

(v) determine whether, at any time the Bonds are outstanding, any person, other than the City, has a naming right for the facilities or any other contractual right granting an intangible benefit;

(vi) determine whether, at any time the Bonds are outstanding, the facilities are sold or otherwise disposed of; and

(vii) take such action as is necessary to remediate any failure to maintain compliance with the covenants contained in the Ordinance related to the public use of the facilities.

C. Record Retention. The Responsible Person will maintain or cause to be maintained all records relating to the investment and expenditure of the proceeds of the Bonds and the use of the facilities financed or refinanced thereby for a period ending three (3) years after the complete extinguishment of the Bonds. If any portion of the Bonds is refunded with the proceeds of another series of tax-exempt obligations, such records shall be maintained until the three (3) years after the refunding obligations are completely extinguished. Such records can be maintained in paper or electronic format.

D. Responsible Person. The Responsible Person shall receive appropriate training regarding the City's accounting system, contract intake system, facilities management and other systems necessary to track the investment and expenditure of the proceeds and the use of the facilities financed or refinanced with the proceeds of the Bonds. The foregoing notwithstanding, the Responsible Person is authorized and instructed to retain such experienced advisors and agents as may be necessary to carry out the purposes of these instructions.

EXHIBIT E

DESCRIPTION OF ANNUAL FINANCIAL INFORMATION

The following information is referred to in Section 12 of this Ordinance.

Annual Financial Statements and Operating Data

The financial information and operating data with respect to the City to be provided annually in accordance with such Section are as specified (and included in the Appendix or under the headings of the Official Statement referred to) below:

1. The annual audited financial statements of the City or the unaudited financial statements of the City in the event audited financial statements are not completed within six months after the end of any fiscal year.

2. All quantitative financial information and operating data with respect to the City of the general type included in the Official Statement under Tables 1 through 5 and 7 through 13thereof.

Accounting Principles

The accounting principles referred to in such Section are the accounting principles described in the notes to the financial statements referred to in paragraph 1 above.

EXHIBIT F

FORM OF ESCROW AGREEMENT

THE ESCROW AGREEMENT IS OMITTED AT THIS POINT AS IT APPEARS ELSEWHERE IN THIS TRANSCRIPT OF PROCEEDINGS

EXHIBIT G

FORM OF NOTICES OF REDEMPTION

First and Final Readings 8. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Horacio De Leon, Assistant Manager; Rosario C. Cabello, Finance

Director

SUBJECT2016-O-021 Ordinance authorizing the issuance of City of Laredo, Texas Waterworksand Sewer System Revenue Refunding Bonds, New Series 2016, for the purpose ofrefunding Waterworks and Sewer System Revenue Bonds, approving an officialstatement, authorizing the execution of a purchase contract and the execution of anescrow agreement, and making provisions for the security thereof, delegating authorityto the Mayor and/or the City Manager to select outstanding bonds to be refunded andapprove all final terms of the bonds, and authorizing amendment to the city's budget toappropriate such proceeds for purposes authorized herein; and ordaining other mattersrelating to the subject.


PREVIOUS COUNCIL ACTIONA Plan of Finance was presented by Noe Hinojosa of Estrada-Hinojosa InvestmentBankers on January 19, 2016.

BACKGROUNDThe City of Laredo in in the process of refinancing various bonds issues including aGeneral Obligation Refunding Bond, Series 2016 and a Waterworks and Sewer SystemRevenue Refunding Bond, Series 2016. The Waterworks and Sewer System Bond willbe refunding a 2007 and a 2010 Waterworks and Sewer System Bond issues in theestimated amount of $24,700,000.00. The transaction is expected to generate estimaedsaving of $2,052,400.00


STAFF RECOMMENDATIONConduct first and final reading of this ordinance.

Fiscal Impact

Fiscal Year: 2016Bugeted Y/N?: NSource of Funds: Bond ProceedsAccount #: VariousChange Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Interest and Principal payments will be determined at the time of the sale of the bonds.

AttachmentsOrdinance 2016-O-021


ORDINANCE AUTHORIZING THE ISSUANCE OF CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BONDS, NEW SERIES 2016, FOR THE PURPOSE OF REFUNDING WATERWORKS AND SEWER SYSTEM REVENUE BONDS, APPROVING AN OFFICIAL STATEMENT, AUTHORIZING THE EXECUTION OF A PURCHASE CONTRACT AND THE EXECUTION OF AN ESCROW AGREEMENT, AND MAKING PROVISIONS FOR THE SECURITY THEREOF, DELEGATING AUTHORITY TO THE MAYOR AND/OR THE CITY MANAGER TO SELECT OUTSTANDING BONDS TO BE REFUNDED AND APPROVE ALL FINAL TERMS OF THE BONDS, AND AUTHORIZING AMENDMENT TO THE CITY'S BUDGET TO APPROPRIATE SUCH PROCEEDS FOR PURPOSES AUTHORIZED HEREIN; AND ORDAINING OTHER MATTERS RELATING TO THE SUBJECT

THE STATE OF TEXAS §COUNTY OF WEBB §CITY OF LAREDO §

WHEREAS, the following sewer system and waterworks and sewer system revenue bonds of the City of Laredo, Texas ("Issuer" or "City") are payable from a first lien on the City's combined waterworks system and sewer system, are presently outstanding:

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, Series 2007, dated August 1, 2007, maturities March 1, 2016 through March 1, 2027, now outstanding in the aggregate principal amount of $12,375,000 (the "Series 2007 Bonds"); and

WHEREAS, the Series 2007 Bonds are hereinafter defined as the “Prior Series Bonds”; and

WHEREAS, the following sewer system and waterworks and sewer system revenue bonds of the City are also payable from a first lien on the City's combined waterworks system and sewer system and are presently outstanding:

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2010, dated October 15, 2010, maturities March 1, 2016 through March 1, 2026, inclusive, March 1, 2030, March 1, 2035, March 1, 2040 and March 1, 2040, now outstanding in the aggregate principal amount of $74,895,000 (the "New Series 2010 Bonds"); and

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2011, dated November 15, 2011, maturities March 1, 2016 through March 1, 2031, inclusive, March 1, 2033, March 1, 2036 and March 1, 2041, now outstanding in the aggregate principal amount of $28,260,000 (the "New Series 2011 Bonds"); and

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2012, dated October 1, 2012, maturities March 1, 2016 through March 1, 2032, inclusive, March 1, 2037 and March 1, 2042, now outstanding in the aggregate principal amount of $38,520,000 (the "New Series 2012 Bonds"); and

City of Laredo, Texas Waterworks and Sewer System Revenue Refunding Bonds, New Series 2013, dated April 1, 2013, maturities March 1, 2016 through March 1, 2026, inclusive, now outstanding in the aggregate principal amount of $17,070,000 (the "New Series 2013 Refunding Bonds"); and

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City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2013, dated October 1, 2013, maturities March 1, 2016 through March 1, 2033, inclusive, March 1, 2038, March 1, 2040, and March 1, 2043 now outstanding in the aggregate principal amount of $17,530,000 (the "New Series 2013 Bonds"); and

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2014, dated October 1, 2014, maturities March 1, 2016 through March 1, 2034, inclusive, March 1, 2036, March 1, 2038, and March 1, 2044 now outstanding in the aggregate principal amount of $9,275,000 (the "New Series 2014 Bonds"); and

City of Laredo, Texas Waterworks and Sewer System Revenue Bonds, New Series 2015, dated September 1, 2015, maturities March 1, 2016 through March 1, 2035, inclusive, March 1, 2040 and March 1, 2045 now outstanding in the aggregate principal amount of $15,045,000 (the "New Series 2015 Bonds"); and

WHEREAS, pursuant to the ordinance which authorized the issuance of the Series 2007 Bonds, maturities March 1, 2018 through March 1, 2027 of such Series 2007 Bonds are subject to redemption, at the option of the City, at the redemption price of par, on March 1, 2017 or any date thereafter; and pursuant to the ordinance which authorized the issuance of the New Series 2010 Bonds, maturities March 1, 2021 through March 1, 2026, inclusive, March 1, 2030, March 1, 2035, March 1, 2040 and March 1, 2040 of such New Series 2010 Bonds are subject to redemption, at the option of the City, at the redemption price of par, on March 1, 2020 or any date thereafter; and

WHEREAS, the City now desires to authorize the refunding of all or a portion of the Series 2007 Bonds and New Series 2010 Bonds that are subject to optional redemption as described in the preceding recital, which are more fully described as follows:

SERIES 2007 BONDS ELIGIBLE TO BE REFUNDED

MATURITY

(MARCH 1)PRINCIPAL AMOUNT


PRINCIPAL AMOUNT

ELIGIBLE TO BE

REFUNDED ($)

STATED

INTEREST

RATE (%)CUSIP NO.

(517039)

2018 875,000 875,000 4.250 DE0

2019 905,000 905,000 4.375 DF7

2020 945,000 945,000 4.500 DG5

2021 995,000 995,000 4.500 DH3

2022 1,035,000 1,035,000 4.625 DJ9

2023 1,095,000 1,095,000 4.625 DK6

2024 1,135,000 1,135,000 4.625 DL4

2025 1,190,000 1,190,000 4.625 DM2

2026 1,250,000 1,250,000 4.750 DN0

2027 1,315,000 1,315,000 4.750 DP5

Totals $10,740,000 $10,740,000 *** ***

NEW SERIES 2010 BONDS ELIGIBLE TO BE REFUNDED

MATURITY

(MARCH 1)PRINCIPAL AMOUNT


PRINCIPAL AMOUNT

ELIGIBLE TO BE

REFUNDED ($)

STATED

INTEREST

RATE (%)CUSIP NO.

(517039)

2021 1,955,000 1,955,000 5.000 FS7

2022 2,055,000 2,055,000 5.000 FT5

2023 2,160,000 2,160,000 5.000 FU2

2024 2,270,000 2,270,000 5.000 FV0

2025 2,385,000 2,385,000 5.000 FW8

2026 2,510,000 2,510,000 5.000 FY4

*** *** *** *** ***

2030 11,450,000 11,450,000 5.250 GB3

*** *** *** *** ***

2035 18,150,000 18,150,000 5.250 FZ1

*** *** *** *** ***

2040-A 3,000,000 3,000,000 4.500 FX6

*** *** *** *** ***

2040-B 20,535,000 20,535,000 5.250 GA5

Totals 66,470,000 66,470,000 *** ***

WHEREAS, pursuant to the provisions of Section 1207.007(a)(4), Texas Government Code, the City now desires to delegate to a "Pricing Officer" (as defined in Section 1(b) below) the authority, individually or collectively, to select the specific maturities and principal amounts of the Series 2007 Bonds and New Series 2010 Bonds described in the preceding recital to be refunded with proceeds of the bonds authorized pursuant to this Ordinance and effect the sale of such bonds; and

WHEREAS, the Series 2007 Bonds and New Series 2010 Bonds selected by a Pricing Officer to be refunded as authorized by Section 1(c) of this Ordinance are hereafter referred to as the "Refunded Obligations"; and

WHEREAS, Chapter 1207, Texas Government Code, as amended ("Chapter 1207"), authorizes the City to issue refunding bonds and to deposit the proceeds from the sale thereof, and any other available funds or resources, directly with a place of payment (paying agent) for the Refunded Obligations, or with another trust company or commercial bank that does not act as a depository for the City, in an amount sufficient to provide for the payment and/or redemption of the Refunded Obligations, and such deposit, if made before such payment dates, shall constitute the making of firm banking and financial arrangements for the discharge and final payment or redemption of the Refunded Obligations; and

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WHEREAS, Chapter 1207 (specifically Section 1207.062, Texas Government Code) further authorizes the City to enter into an escrow agreement with any paying agent for the Refunded Obligations, or with another trust company or commercial bank that does not act as a depository for the City, with respect to the safekeeping, investment, reinvestment, administration and disposition of any such deposit, upon such terms and conditions as the City and such paying agent may agree; provided that such deposits may be invested and reinvested in:

(i) direct noncallable obligations of the United States, including obligations that are unconditionally guaranteed by the United States,

(ii) noncallable obligations of an agency or instrumentality of the United States, including obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date the City Council of the City adopts or approves this Ordinance, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, and

(iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the date the City Council of the City adopts or approves this Ordinance, are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent,

and all of which must mature and bear interest payable at such times and in such amounts as will be sufficient to provide for the scheduled payment or redemption of the Refunded Obligations; and

WHEREAS, the Pricing Officer is hereby authorized to select any paying agent for the Refunded Obligations or another trust company or commercial bank that does not act as a depository for the City as the escrow agent (the “Escrow Agent”), and the Escrow Agreement hereinafter authorized between the City and Escrow Agent, shall constitute an escrow agreement of the kind authorized and permitted by Chapter 1207; and

WHEREAS, the City Council of the City hereby finds and declares a public purpose and deems it advisable and in the best interests of the City to issue a series of bonds (defined in Section 2 hereof as the "Bonds"), the proceeds of which will be used to pay costs of issuance and refund the Refunded Obligations in order to achieve a gross debt service savings and a net present value debt service savings for the benefit of the taxpayers of the City; provided, however, in no event shall Bonds be issued unless the City is able to achieve a net present value debt service savings of at least 3.00% of the principal of the Refunded Obligations; and

WHEREAS, the Issuer deemed it advisable to designate the New Series 2010 Bonds and all future bonds issued on parity with the Prior Series Bonds, including the bonds authorized herein, as “New Series Bonds” to distinguish them from the Prior Series Bonds; and

WHEREAS, the Issuer deems it advisable for certain provisions of this Ordinance, as described herein, to be substituted and applicable to the New Series Bonds at such time as the Prior Series Bonds are either defeased or no longer outstanding; and

WHEREAS, the Bonds hereinafter authorized and designated are to be issued and delivered pursuant to Chapter 1207; and

WHEREAS, the meeting was open to the public and public notice of the time, place and purpose of said meeting was given pursuant to Chapter 551, Texas Government Code.

NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS:

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Section 1. AMOUNT AND PURPOSE OF THE BONDS. (a) Authorization to Issue Waterworks and Sewer System Revenue Refunding Bonds. Waterworks and Sewers System revenuebonds of the City are hereby authorized to be issued and delivered in the aggregate principal amount as designated by the Mayor and/or the City Manager (the "Pricing Officer") pursuant to the provisions of Section 1(b) of this Ordinance FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE ISSUER'S OUTSTANDING WATERWORKS AND SEWER SYSTEM REVENUEINDEBTEDNESS AND TO PAY FOR COSTS OF ISSUANCE.

(b) Delegation of Final Terms. As authorized by Section 1207.007, Texas Government Code, each Pricing Officer, acting individually or in combination with another Pricing Officer, is hereby authorized, appointed, and designated as an officer of the City authorized to act on behalf of the City to effect the sale of the Bonds and to establish the terms and details related to the issuance and sale of the Bonds including the total aggregate principal amount of Bonds to be issued (but in no event to exceed $80,000,000 in aggregate principal amount), the price at which the Bonds will be sold (but in no event shall the Bonds be sold at a price which would result in a net present value savings of less than 4.00% of the principal amount of the Refunded Obligations), the date of the Bonds, the aggregate principal amount of each maturity thereof, the due date of each maturity (but in no event later than March 1, 2040), the rate of interest to be borne on the principal amount of each such maturity (but in no event to exceed a net effective interest rate for all of the Bonds of 5.50% per annum), the interest payment periods, the dates, price and terms upon and at which the Bonds shall be subject to any mandatory sinking fund redemption provisions for any maturity, and all other matters relating to the issuance, sale and delivery of the Bonds. Each Pricing Officer, acting individually or in combination with another Pricing Officer for and on behalf of the City, is further authorized to (i) complete and attach Schedule I of this Ordinance (the “Schedule I”), and (ii) revise and complete the FORM OF INITIAL BOND set forth in Section 5 of this Ordinance, with the final terms of the Bonds approved pursuant to the authority granted herein, and to enter into, execute and carry out an agreement to purchase the Bonds (the "Purchase Contract") with the Underwriters named in Section 32 herein.

(c) Delegation of Authority to Select Series 2007 Bonds and New Series 2010 Bonds for Refunding. As authorized by Section 1207.007(a)(4), Texas Government Code, each Pricing Officer, acting individually or in combination with another Pricing Officer for and on behalf of the Issuer, is hereby authorized to select all or any portion of the Series 2007 Bonds and New Series 2010 Bondsdescribed in the fourth and fifth recitals to this Ordinance to be refunded with proceeds of the Bonds and to evidence the selection of such Series 2007 Bonds and New Series 2010 Bonds by executing and attaching to this Ordinance as Schedule II a certificate describing the maturities and the principal amount of such maturities of the Series 2007 Bonds and New Series 2010 Bonds to be refunded with the proceeds of the Bonds (“Schedule II” and together with Schedule I, the “Pricing Certificate”).

(d) Determination Required by Section 1201.022(a)(3), Texas Government Code. In satisfaction of Section 1201.022(a)(3), Texas Government Code, the City Council hereby determines that the delegation of the authority to each Pricing Officer to approve the final terms of the Bonds set forth in this Ordinance is, and the decisions made by a Pricing Officer pursuant to such delegated authority and incorporated in Schedule I will be, in the City's best interests, and each Pricing Officer is hereby authorized to make and include in Schedule I an appropriate finding to that effect.

(e) Expiration of Delegation Authority. The authority delegated to a Pricing Officer pursuant to Sections 1(b) and (c) above shall expire on August 1, 2016.

Section 2. DESIGNATION OF THE BONDS. Each bond issued pursuant to this Ordinance shall be designated: "CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BOND, NEW SERIES 2016", and initially there shall be issued,

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sold, and delivered hereunder a single fully registered bond, without interest coupons, payable in annual installments of principal (the "Initial Bond"), but the Initial Bond may be assigned and transferred and/or converted into and exchanged for a like aggregate principal amount of fully registered bonds, without interest coupons, having serial and annual maturities, and in the denomination or denominations of $5,000 or any integral multiple of $5,000, all in the manner hereinafter provided. The term "Bonds" as used in this Ordinance shall mean and include collectively the Initial Bond and all substitute bonds exchanged therefor, as well as all other substitute bonds and replacement bonds issued pursuant hereto, and the term "Bond" shall mean any of the Bonds.

Section 3. INITIAL DATE, DENOMINATION, NUMBER, MATURITIES, INITIAL REGISTERED OWNER, AND CHARACTERISTICS OF THE INITIAL BOND. (a) The Initial Bond is hereby authorized to be issued, sold, and delivered hereunder as a single fully registered Bond, without interest coupons, dated as determined in the Pricing Certificate, in the denomination and aggregate principal amount as set forth in the Pricing Certificate numbered R-1, payable in annual installments of principal to the initial registered owner as described in Section 32 hereof, to the registered assignee or assignees of said Bond or any portion or portions thereof (in each case, the "registered owner"), with the annual installments of principal of the Initial Bond to be payable on the dates, respectively, and in the principal amounts, respectively, stated in the Pricing Certificate.

(b) The Initial Bond (i) may be prepaid or redeemed prior to the respective scheduled due dates of installments of principal thereof, (ii) may be assigned and transferred, (iii) may be converted and exchanged for other Bonds, (iv) shall have the characteristics, and (v) shall be signed and sealed, and the principal of and interest on the Initial Bond shall be payable, all as provided, and in the manner required or indicated, in the FORM OF INITIAL BOND set forth in this Ordinance with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance, and with the Bonds to be completed with information set forth in the Pricing Certificate.

Section 4. INTEREST. The Bonds shall bear interest to their respective dates of maturity or redemption prior to maturity at the rates per annum as set forth in the Pricing Certificate.

Section 5. FORM OF INITIAL BOND. The form of the Initial Bond, including the form of Registration Certificate of the Comptroller of Public Accounts of the State of Texas to be endorsed on the Initial Bond, shall be substantially as follows, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance, and with the Bonds to be completed with information set forth in the Pricing Certificate:


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FORM OF INITIAL BOND

NO. R-1 $_____________UNITED STATES OF AMERICA

STATE OF TEXASCOUNTY OF WEBB

CITY OF LAREDO, TEXASWATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BOND, NEW SERIES 2016

The CITY OF LAREDO, in WEBB COUNTY, TEXAS (the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to

________________________

or to the registered assignee or assignees of this Bond or any portion or portions hereof (in each case, the "registered owner") the aggregate principal amount of

_______________________

in annual installments of principal due and payable on September 1, 2016 and subsequently on March 1, and in the respective principal amounts, as set forth in the following schedule:

MATURITY

DATE AMOUNT

MATURITY

DATE AMOUNT

and to pay interest, from March 30, 2016, on the balance of each such installment of principal, respectively, from time to time remaining unpaid, at the rates as follows:

DATE

INTEREST

RATE DATE

INTEREST

RATE

with said interest being payable on September 1, 2016, and semiannually on each September 1 and March 1 thereafter while this Bond or any portion hereof is outstanding and unpaid.

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THE INSTALLMENTS OF PRINCIPAL OF AND THE INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The installments of principal and the interest on this Bond are payable to the registered owner hereof through the services of ______________________________, __________, ____________, which is the "Paying Agent/Registrar" for this Bond. Payment of all principal of and interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each principal and/or interest payment date by check or draft, dated as of such date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer required by the ordinance authorizing the issuance of this Bond (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such principal and/or interest payment date, to the registered owner hereof, at the address of the registered owner, as it appeared on the 15th day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described, or by such other method acceptable to the Paying Agent/Registrar requested by, and at the risk and expense of, the registered owner. The Issuer covenants with the registered owner of this Bond that on or before each principal and/or interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on this Bond, when due.

IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the city where the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due.

THIS BOND has been authorized in accordance with the Constitution and laws of the State of Texas, in the principal amount of $_____________ FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE ISSUER'S OUTSTANDING WATERWORKS AND SEWER SYSTEM REVENUE INDEBTEDNESS AND TO PAY FOR COSTS OF ISSUANCE.

ON MARCH 1, 20__, or any date thereafter, the unpaid installments of principal of this Bond may be prepaid or redeemed prior to their scheduled due dates, at the option of the Issuer, with funds derived from any available source, as a whole, or in part, and, if in part, the Issuer shall select and designate the maturity, or maturities, and the amount that is to be redeemed, and if less than a whole maturity is to be called, the Issuer shall direct the Paying Agent/Registrar to call by lot (provided that a portion of this Bond may be redeemed only in an integral multiple of $5,000), at the redemption price of the principal amount, plus accrued interest to the date fixed for prepayment or redemption.

THIS BOND, to the extent of the unpaid or unredeemed principal balance hereof, or any unpaid and unredeemed portion hereof in any integral multiple of $5,000, may be assigned by the initial registered owner hereof and shall be transferred only in the Registration Books of the Issuer kept by the Paying Agent/Registrar acting in the capacity of registrar for the Bonds, upon the terms and conditions set forth in the Bond Ordinance. Among other requirements for such transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar for cancellation, together with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment by the initial registered owner of this Bond, or any portion or portions hereof in any integral multiple of $5,000, to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be transferred and registered. Any instrument or instruments

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of assignment satisfactory to the Paying Agent/Registrar may be used to evidence the assignment of this Bond or any such portion or portions hereof by the initial registered owner hereof. A new bond or bonds payable to such assignee or assignees (which then will be the new registered owner or owners of such new Bond or Bonds) or to the initial registered owner as to any portion of this Bond which is not being assigned and transferred by the initial registered owner, shall be delivered by the Paying Agent/Registrar in conversion of and exchange for this Bond or any portion or portions hereof, but solely in the form and manner as provided in the next paragraph hereof for the conversion and exchange of this Bond or any portion hereof. The registered owner of this Bond shall be deemed and treated by the Issuer and the Paying Agent/Registrar as the absolute owner hereof for all purposes, including payment and discharge of liability upon this Bond to the extent of such payment, and the Issuer and the Paying Agent/Registrar shall not be affected by any notice to the contrary.

AS PROVIDED above and in the Bond Ordinance, this Bond, to the extent of the unpaid or unredeemed principal balance hereof, may be converted into and exchanged for a like aggregate principal amount of fully registered bonds, without interest coupons, payable to the assignee or assignees duly designated in writing by the initial registered owner hereof, or to the initial registered owner as to any portion of this Bond which is not being assigned and transferred by the initial registered owner, in any denomination or denominations in any integral multiple of $5,000 (subject to the requirement hereinafter stated that each substitute bond issued in exchange for any portion of this Bond shall have a single stated principal maturity date), upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Bond Ordinance. If this Bond or any portion hereof is assigned and transferred or converted each bond issued in exchange for any portion hereof shall have a single stated principal maturity date corresponding to the due date of the installment of principal of this Bond or portion hereof for which the substitute bond is being exchanged, and shall bear interest at the rate applicable to and borne by such installment of principal or portion thereof. Such bonds, respectively, shall be subject to redemption prior to maturity on the same dates and for the same prices as the corresponding installment of principal of this Bond or portion hereof for which they are being exchanged. No such bond shall be payable in installments, but shall have only one stated principal maturity date. AS PROVIDED IN THE BOND ORDINANCE, THIS BOND IN ITS PRESENT FORM MAY BE ASSIGNED AND TRANSFERRED OR CONVERTED ONCE ONLY, and to one or more assignees, but the bonds issued and delivered in exchange for this Bond or any portion hereof may be assigned and transferred, and converted, subsequently, as provided in the Bond Ordinance. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for transferring, converting, and exchanging this Bond or any portion thereof, but the one requesting such transfer, conversion, and exchange shall pay any taxes or governmental charges required to be paid with respect thereto. The Paying Agent/Registrar shall not be required to make any such assignment, conversion, or exchange (i)during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or portion thereof called for prepayment or redemption prior to maturity, within 45 days prior to its prepayment or redemption date.

IN THE EVENT any Paying Agent/Registrar for this Bond is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, and promptly will cause written notice thereof to be mailed to the registered owner of this Bond.

IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly authorized, issued, and delivered pursuant to the laws of the State of Texas; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond and the Series of which it is a part have been performed, existed, and

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been done in accordance with law; that this Bond is a special obligation of said Issuer, and that the principal of and interest on this Bond, together with other outstanding Previously Issued Parity Bonds, as defined in the Bond Ordinance, of the Issuer, are payable and secured by a first lien on and pledge of the Pledged Revenues as defined in the Bond Ordinance.

THE ISSUER has reserved the right, subject to the restrictions stated, and adopted by reference, in the Ordinance authorizing this Series of Bonds, to issue additional parity revenue bonds which also may be made payable from, and secured by a first lien on and pledge of, the aforesaid Pledged Revenues.

THE ISSUER also has reserved the right, subject to the restrictions stated in the Bond Ordinance, to amend the Bond Ordinance.

THE REGISTERED OWNER HEREOF shall never have the right to demand payment of this Bond or the interest hereon out of any funds raised or to be raised by taxation, or from any sources whatsoever other than those described in the Bond Ordinance.

BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Ordinance constitute a contract between the registered owner hereof and the Issuer.

IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the Mayor of the Issuer and countersigned with the manual or facsimile signature of the City Secretary of the Issuer, has caused the official seal of the Issuer to be duly impressed, or placed in facsimile, on this Bond, and has caused this Bond to be dated March 15, 2016.

City Secretary Mayor

(CITY SEAL)

FORM OF REGISTRATION CERTIFICATE OF THECOMPTROLLER OF PUBLIC ACCOUNTS:

COMPTROLLER'S REGISTRATION CERTIFICATE: REGISTER NO.

I hereby certify that this Bond has been examined, certified as to validity, and approved by the Attorney General of the State of Texas, and that this Bond has been registered by the Comptroller of Public Accounts of the State of Texas.

Witness my signature and seal this

Comptroller of Public Accounts of the State of Texas(COMPTROLLER'S SEAL)

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Section 6. ADDITIONAL CHARACTERISTICS OF THE BONDS. (a) Registration and Transfer. The Issuer shall keep or cause to be kept at the principal corporate trust office of the designated office of a paying agent to be approved by the Pricing Officer (the "PayingAgent/Registrar") books or records of the registration and transfer of the Bonds (the "Registration Books"), and the Issuer hereby appoints the Paying Agent/Registrar as its registrar and transfer agent to keep such books or records and make such transfers and registrations under such reasonable regulations as the Issuer and Paying Agent/Registrar may prescribe; and the Paying Agent/Registrar shall make such transfers and registrations as herein provided. The Paying Agent/Registrar shall obtain and record in the Registration Books the address of the registered owner of each Bond to which payments with respect to the Bonds shall be mailed, as herein provided; but it shall be the duty of each registered owner to notify the Paying Agent/Registrar in writing of the address to which payments shall be mailed, and such interest payments shall not be mailed unless such notice has been given. The Issuer shall have the right to inspect the Registration Books during regular business hours of the Paying Agent/Registrar, but otherwise the Paying Agent/Registrar shall keep the Registration Books confidential and, unless otherwise required by law, shall not permit their inspection by any other entity. Registration of each Bond may be transferred in the Registration Books only upon presentation and surrender of such Bond to the Paying Agent/Registrar for transfer of registration and cancellation, together with proper written instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, (i) evidencing the assignment of the Bond, or any portion thereof in any integral multiple of $5,000, to the assignee or assignees thereof, and (ii) the right of such assignee or assignees to have the Bond or any such portion thereof registered in the name of such assignee or assignees. Upon the assignment and transfer of any Bond or any portion thereof, a new substitute Bond or Bonds shall be issued in conversion and exchange therefor in the manner herein provided. The Initial Bond, to the extent of the unpaid or unredeemed principal balance thereof, may be assigned and transferred by the initial registered owner thereof once only, and to one or more assignees designated in writing by the initial registered owner thereof. All Bonds issued and delivered in conversion of and exchange for the Initial Bond shall be in any denomination or denominations of any integral multiple of $5,000 (subject to the requirement hereinafter stated that each substitute Bond shall have a single stated principal maturity date), shall be in the form prescribed in the FORM OF SUBSTITUTE BOND set forth in this Ordinance, and shall have the characteristics, and may be assigned, transferred, and converted as hereinafter provided. If the Initial Bond or any portion thereof is assigned and transferred or converted the Initial Bond must be surrendered to the Paying Agent/Registrar for cancellation, and each Bond issued in exchange for any portion of the Initial Bond shall have a single stated principal maturity date, and shall not be payable in installments; and each such Bond shall have a principal maturity date corresponding to the due date of the installment of principal or portion thereof for which the substitute Bond is being exchanged; and each such Bond shall bear interest at the single rate applicable to and borne by such installment of principal or portion thereof for which it is being exchanged. If only a portion of the Initial Bond is assigned and transferred, there shall be delivered to and registered in the name of the initial registered owner substitute Bonds in exchange for the unassigned balance of the Initial Bond in the same manner as if the initial registered owner were the assignee thereof. If any Bond or portion thereof other than the Initial Bond is assigned and transferred or converted each Bond issued in exchange shall have the same principal maturity date and bear interest at the same rate as the Bond for which it is exchanged. A form of assignment shall be printed or endorsed on each Bond, excepting the Initial Bond, which shall be executed by the registered owner or its duly authorized attorney or representative to evidence an assignment thereof. Upon surrender of any Bonds or any portion or portions thereof for transfer of registration, an authorized representative of the Paying Agent/Registrar shall make such transfer in the Registration Books, and shall deliver a new fully registered substitute Bond or Bonds, having the characteristics herein described, payable to such assignee or assignees (which then will be the registered owner or owners of such new Bond or Bonds), or to the previous registered owner in case only a portion of a Bond is being assigned

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and transferred, all in conversion of and exchange for said assigned Bond or Bonds or any portion or portions thereof, in the same form and manner, and with the same effect, as provided in Section 6(d), below, for the conversion and exchange of Bonds by any registered owner of a Bond. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for making such transfer and delivery of a substitute Bond or Bonds, but the one requesting such transfer shall pay any taxes or other governmental charges required to be paid with respect thereto. The Paying Agent/Registrar shall not be required to make transfers of registration of any Bond or any portion thereof (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 30 days prior to its redemption date.

Attached hereto as Exhibit A is a copy of the Paying Agent/Registrar Agreement between the City and the Paying Agent/Registrar which is hereby approved in substantially final form, and the Mayor, Mayor Pro-Tem and City Secretary of the City are hereby authorized to execute the Paying Agent/Registrar Agreement and approve any changes in the final form thereof.

(b) Ownership of Bonds. The entity in whose name any Bond shall be registered in the Registration Books at any time shall be deemed and treated as the absolute owner thereof for all purposes of this Ordinance, whether or not such Bond shall be overdue, and the Issuer and the Paying Agent/Registrar shall not be affected by any notice to the contrary; and payment of, or on account of, the principal of, premium, if any, and interest on any such Bond shall be made only to such registered owner. All such payments shall be valid and effectual to satisfy and discharge the liability upon such Bond to the extent of the sum or sums so paid.

(c) Payment of Bonds and Interest. The Issuer hereby further appoints the Paying Agent/Registrar to act as the paying agent for paying the principal of and interest on the Bonds, and to act as its agent to convert and exchange or replace Bonds, all as provided in this Ordinance. The Paying Agent/Registrar shall keep proper records of all payments made by the Issuer and the Paying Agent/Registrar with respect to the Bonds, and of all conversions and exchanges of Bonds, and all replacements of Bonds, as provided in this Ordinance. However, in the event of a nonpayment of interest on a scheduled payment date, and for thirty (30) days thereafter, a new record date for such interest payment (a "Special Record Date") will be established by the Paying Agent/Registrar, if and when funds for the payment of such interest have been received from the Issuer. Notice of the Special Record Date and of the scheduled payment date of the past due interest (which shall be 15 days after the Special Record Date) shall be sent at least five (5) business days prior to the Special Record Date by United States mail, first class postage prepaid, to the address of each Bondholder appearing on the Security Register at the close of business on the last business day next preceding the date of mailing of such notice.

(d) Conversion and Exchange or Replacement; Authentication. Each Bond issued and delivered pursuant to this Ordinance, to the extent of the unpaid or unredeemed principal balance or principal amount thereof, may, upon surrender of such Bond at the principal corporate trust office of the Paying Agent/Registrar, together with a written request therefor duly executed by the registered owner or the assignee or assignees thereof, or its or their duly authorized attorneys or representatives, with guarantee of signatures satisfactory to the Paying Agent/Registrar, may, at the option of the registered owner or such assignee or assignees, as appropriate, be converted into and exchanged for fully registered bonds, without interest coupons, in the form prescribed in the FORM OF SUBSTITUTE BOND set forth in this Ordinance, in the denomination of $5,000, or any integral multiple of $5,000 (subject to the requirement hereinafter stated that each substitute Bond shall have a single stated maturity date), as requested in writing by such registered owner or such assignee or assignees, in an aggregate principal amount equal to the unpaid or unredeemed principal balance or principal amount of any Bond or Bonds so surrendered,

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and payable to the appropriate registered owner, assignee, or assignees, as the case may be. If the Initial Bond is assigned and transferred or converted each substitute Bond issued in exchange for any portion of the Initial Bond shall have a single stated principal maturity date, and shall not be payable in installments; and each such Bond shall have a principal maturity date corresponding to the due date of the installment of principal or portion thereof for which the substitute Bond is being exchanged; and each such Bond shall bear interest at the single rate applicable to and borne by such installment of principal or portion thereof for which it is being exchanged. If a portion of any Bond (other than the Initial Bond) shall be redeemed prior to its scheduled maturity as provided herein, a substitute Bond or Bonds having the same maturity date, bearing interest at the same rate, in the denomination or denominations of any integral multiple of $5,000 at the request of the registered owner, and in aggregate principal amount equal to the unredeemed portion thereof, will be issued to the registered owner upon surrender thereof for cancellation. If any Bond or portion thereof (other than the Initial Bond) is assigned and transferred or converted, each Bond issued in exchange therefor shall have the same principal maturity date and bear interest at the same rate as the Bond for which it is being exchanged. Each substitute Bond shall bear a letter and/or number to distinguish it from each other Bond. The Paying Agent/Registrar shall convert and exchange or replace Bonds as provided herein, and each fully registered bond delivered in conversion of and exchange for or replacement of any Bond or portion thereof as permitted or required by any provision of this Ordinance shall constitute one of the Bonds for all purposes of this Ordinance, and may again be converted and exchanged or replaced. It is specifically provided that any Bond authenticated in conversion of and exchange for or replacement of another Bond on or prior to the first scheduled Record Date for the Initial Bond shall bear interest from the date of the Initial Bond, but each substitute Bond so authenticated after such first scheduled Record Date shall bear interest from the interest payment date next preceding the date on which such substitute Bond was so authenticated, unless such Bond is authenticated after any Record Date but on or before the next following interest payment date, in which case it shall bear interest from such next following interest payment date; provided, however, that if at the time of delivery of any substitute Bond the interest on the Bond for which it is being exchanged is due but has not been paid, then such Bond shall bear interest from the date to which such interest has been paid in full. THE INITIAL BOND issued and delivered pursuant to this Ordinance is not required to be, and shall not be, authenticated by the Paying Agent/ Registrar, but on each substitute Bond issued in conversion of and exchange for or replacement of any Bond or Bonds issued under this Ordinance there shall be printed a certificate, in the form substantially as follows:

"PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE

It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described on the face of this Bond; and that this Bond has been issued in conversion of and exchange for or replacement of a bond, bonds, or a portion of a bond or bonds of an issue which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas.

_____________________________________Paying Agent/Registrar

Dated __________ By_________________________Authorized Representative"

An authorized representative of the Paying Agent/Registrar shall, before the delivery of any such Bond, date and manually sign the above Certificate, and no such Bond shall be deemed to be issued or outstanding unless such Certificate is so executed. The Paying Agent/Registrar promptly shall cancel all

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Bonds surrendered for conversion and exchange or replacement. No additional ordinances, orders, or resolutions need be passed or adopted by the governing body of the Issuer or any other body or person so as to accomplish the foregoing conversion and exchange or replacement of any Bond or portion thereof, and the Paying Agent/Registrar shall provide for the printing, execution, and delivery of the substitute Bonds in the manner prescribed herein, and said Bonds shall be of type composition printed on paper with lithographed or steel engraved borders of customary weight and strength. Pursuant to Chapter 1207, the duty of conversion and exchange or replacement of Bonds as aforesaid is hereby imposed upon the Paying Agent/Registrar, and, upon the execution of the above Paying Agent/Registrar's Authentication Certificate, the converted and exchanged or replaced Bond shall be valid, incontestable, and enforceable in the same manner and with the same effect as the Initial Bond which originally was issued pursuant to this Ordinance, approved by the Attorney General, and registered by the Comptroller of Public Accounts. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for transferring, converting, and exchanging any Bond or any portion thereof, but the one requesting any such transfer, conversion, and exchange shall pay any taxes or governmental charges required to be paid with respect thereto as a condition precedent to the exercise of such privilege of conversion and exchange. The Paying Agent/Registrar shall not be required to make any such conversion and exchange or replacement of Bonds or any portion thereof (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date.

(e) In General. All Bonds issued in conversion and exchange or replacement of any other Bond or portion thereof, (i) shall be issued in fully registered form, without interest coupons, with the principal of and interest on such Bonds to be payable only to the registered owners thereof, (ii) may be redeemed prior to their scheduled maturities, (iii) may be transferred and assigned, (iv) may be converted and exchanged for other Bonds, (v) shall have the characteristics, (vi) shall be signed and sealed, and (vii) the principal of and interest on the Bonds shall be payable, all as provided, and in the manner required or indicated, in the FORM OF SUBSTITUTE BOND set forth in this Ordinance.

(f) Payment of Fees and Charges. The Issuer hereby covenants with the registered owners of the Bonds that it will (i) pay the standard or customary fees and charges of the Paying Agent/Registrar for its services with respect to the payment of the principal of and interest on the Bonds, when due, and (ii) pay the fees and charges of the Paying Agent/Registrar for services with respect to the transfer of registration of Bonds, and with respect to the conversion and exchange of Bonds solely to the extent above provided in this Ordinance.

(g) Substitute Paying Agent/Registrar. The Issuer covenants with the registered owners of the Bonds that at all times while the Bonds are outstanding the Issuer will provide a competent and legally qualified bank, trust company, financial institution, or other agency to act as and perform the services of Paying Agent/Registrar for the Bonds under this Ordinance, and that the Paying Agent/Registrar will be one entity. The Issuer reserves the right to, and may, at its option, change the Paying Agent/Registrar upon not less than 120 days written notice to the Paying Agent/ Registrar, to be effective not later than 60 days prior to the next principal or interest payment date after such notice. In the event that the entity at any time acting as Paying Agent/Registrar (or its successor by merger, acquisition, or other method) should resign or otherwise cease to act as such, the Issuer covenants that promptly it will appoint a competent and legally qualified bank, trust company, financial institution, or other agency to act as Paying Agent/Registrar under this Ordinance. Upon any change in the Paying Agent/Registrar, the previous Paying Agent/Registrar promptly shall transfer and deliver the Registration Books (or a copy thereof), along with all other pertinent books and records relating to the Bonds, to the new Paying Agent/Registrar designated and appointed by the Issuer. Upon any change in the Paying Agent/Registrar,

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the Issuer promptly will cause a written notice thereof to be sent by the new Paying Agent/Registrar to each registered owner of the Bonds, by United States mail, first-class postage prepaid, which notice also shall give the address of the new Paying Agent/Registrar. By accepting the position and performing as such, each Paying Agent/Registrar shall be deemed to have agreed to the provisions of this Ordinance, and a certified copy of this Ordinance shall be delivered to each Paying Agent/Registrar.

(h) Book-Entry Only System. The Bonds issued in exchange for the Bonds initially issued to the purchaser specified herein shall be initially issued in the form of a separate single fully registered Bond for each of the maturities thereof. Upon initial issuance, the ownership of each such Bond shall be registered in the name of Cede & Co., as nominee of Depository Trust Company of New York ("DTC"), and except as provided in subsection (f) hereof, all of the outstanding Bonds shall be registered in the name of Cede & Co., as nominee of DTC.

With respect to Bonds registered in the name of Cede & Co., as nominee of DTC, the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation to any DTC Participant or to any person on behalf of whom such a DTC Participant holds an interest on the Bonds. Without limiting the immediately preceding sentence, the Issuer and the Paying Agent/Registrar shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds, (ii) the delivery to any DTC Participant or any other person, other than a Bondholder, as shown on the Registration Books, of any notice with respect to the Bonds, including any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than a Bondholder, as shown in the Registration Books of any amount with respect to principal of, premium, if any, or interest on, as the case may be, the Bonds. Notwithstanding any other provision of this Ordinance to the contrary, the Issuer and the Paying Agent/Registrar shall be entitled to treat and consider the person in whose name each Bond is registered in the Registration Books as the absolute owner of such Bond for the purpose of payment of principal, premium, if any, and interest, as the case may be, with respect to such Bond, for the purpose of giving notices of redemption and other matters with respect to such Bond, for the purpose of registering transfers with respect to such Bond, and for all other purposes whatsoever. The Paying Agent/Registrar shall pay all principal of, premium, if any, and interest on the Bonds only to or upon the order of the respective owners, as shown in the Registration Books as provided in this Ordinance, or their respective attorneys duly authorized in writing, and all such payments shall be valid and effective to fully satisfy and discharge the Issuer's obligations with respect to payment of principal of, premium, if any, and interest on, or as the case may be, the Bonds to the extent of the sum or sums so paid. No person other than an owner, as shown in the Registration Books, shall receive a Bond certificate evidencing the obligation of the Issuer to make payments of principal, premium, if any, and interest, as the case may be, pursuant to this Ordinance. Upon delivery by DTC to the Paying Agent/Registrar of written notice to the effect that DTC has determined to substitute a new nominee in place of Cede & Co., and subject to the provisions in this Ordinance with respect to interest checks being mailed to the registered owner at the close of business on the Record Date, the word "Cede & Co." in this Ordinance shall refer to such new nominee of DTC.

(i) Successor Securities Depository; Transfers Outside Book-Entry Only System. In the event that the Issuer or the Paying Agent/Registrar determines that DTC is incapable of discharging its responsibilities described herein and in the representation letter of the Issuer to DTC and that it is in the best interest of the beneficial owners of the Bonds that they be able to obtain certificated Bonds, the Issuer or the Paying Agent/Registrar shall (i) appoint a successor securities depository, qualified to act as such under Section 17(a) of the Securities and Exchange Act of 1934, as amended, notify DTC and DTC Participants of the appointment of such successor securities depository and transfer one or more separate Bonds to such successor securities depository or (ii) notify DTC and DTC Participants of the availability through DTC of Bonds and transfer one or more separate Bonds to DTC Participants having Bonds

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credited to their DTC accounts. In such event, the Bonds shall no longer be restricted to being registered in the Registration Books in the name of Cede & Co., as nominee of DTC, but may be registered in the name of the successor securities depository, or its nominee, or in whatever name or names Bondholders transferring or exchanging Bonds shall designate, in accordance with the provisions of this Ordinance.

(j) Payments to Cede & Co. Notwithstanding any other provision of this Ordinance to the contrary, so long as any Bond is registered in the name of Cede & Co., as nominee of DTC, all payments with respect to principal of, premium, if any, and interest on, or as the case may be, such Bond and all notices with respect to such Bond shall be made and given, respectively, in the manner provided in the representation letter of the Issuer to DTC.


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Section 7. FORM OF SUBSTITUTE BONDS. The form of all Bonds issued in conversion and exchange or replacement of any other Bond or portion thereof, including the form of Paying Agent/Registrar's Certificate to be printed on each of such Bonds, and the Form of Assignment to be printed on each of the Bonds, shall be, respectively, substantially as follows, with such appropriate variations, omissions, or insertions as are permitted or required by this Ordinance, and with the Bonds to be completed with information set forth in the Pricing Certificate.

FORM OF SUBSTITUTE BOND

NO. _____ PRINCIPAL AMOUNTUNITED STATES OF AMERICA

STATE OF TEXASCOUNTY OF WEBB

CITY OF LAREDO, TEXASWATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BOND, NEW SERIES 2016

INTEREST RATE MATURITY DATE DATE OF ORIGINAL ISSUE CUSIP NO.

_______, 2016

ON THE MATURITY DATE specified above THE CITY OF LAREDO, in WEBB COUNTY, TEXAS (the "Issuer"), being a political subdivision of the State of Texas, hereby promises to pay to

CEDE & CO.,

or to the registered assignee hereof (either being hereinafter called the "registered owner") the principal amount of

________________________________________________

and to pay interest thereon from __________ to the maturity date specified above, at the interest rate per annum specified above; with interest being payable on __________, 2016 and semiannually thereafter on each September 1 and March 1, except that if the date of authentication of this Bond is later than _______________, such principal amount shall bear interest from the interest payment date next preceding the date of authentication, unless such date of authentication is after any Record Date (hereinafter defined) but on or before the next following interest payment date, in which case such principal amount shall bear interest from such next following interest payment date.

THE PRINCIPAL OF AND INTEREST ON this Bond are payable in lawful money of the United States of America, without exchange or collection charges. The principal of this Bond shall be paid to the registered owner hereof upon presentation and surrender of this Bond at maturity or upon the date fixed for its redemption prior to maturity, at the principal corporate trust office of ______________________________, __________, ____________, which is the "Paying Agent/Registrar" for this Bond. The payment of interest on this Bond shall be made by the Paying Agent/Registrar to the registered owner hereof on each interest payment date by check or draft, dated as of such interest payment date, drawn by the Paying Agent/Registrar on, and payable solely from, funds of the Issuer required by the ordinance authorizing the issuance of the Bonds (the "Bond Ordinance") to be on deposit with the Paying Agent/Registrar for such purpose as hereinafter provided; and such check or draft shall be sent by the Paying Agent/Registrar by United States mail, first-class postage prepaid, on each such interest payment date, to the registered owner hereof, at the address of the registered owner, as

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it appeared on the 15th day of the month next preceding each such date (the "Record Date") on the Registration Books kept by the Paying Agent/Registrar, as hereinafter described, or by such other method acceptable to the Paying Agent/Registrar requested by, and the risk and expense of, the registered owner. Any accrued interest due upon the redemption of this Bond prior to maturity as provided herein shall be paid to the registered owner upon presentation and surrender of this Bond for redemption and payment at the principal corporate trust office of the Paying Agent/Registrar. The Issuer covenants with the registered owner of this Bond that on or before each principal payment date, interest payment date, and accrued interest payment date for this Bond it will make available to the Paying Agent/Registrar, from the "Interest and Sinking Fund" created by the Bond Ordinance, the amounts required to provide for the payment, in immediately available funds, of all principal of and interest on the Bonds, when due.

IF THE DATE for the payment of the principal of or interest on this Bond shall be a Saturday, Sunday, a legal holiday, or a day on which banking institutions in the City where the Paying Agent/Registrar is located are authorized by law or executive order to close, then the date for such payment shall be the next succeeding day which is not such a Saturday, Sunday, legal holiday, or day on which banking institutions are authorized to close; and payment on such date shall have the same force and effect as if made on the original date payment was due.

THIS BOND is one of an issue of Bonds initially dated March 15, 2016, authorized in accordance with the Constitution and laws of the State of Texas in the principal amount of $_____________ FOR THE PURPOSE OF PROVIDING FUNDS TO REFUND A PORTION OF THE ISSUER'S OUTSTANDING WATERWORKS AND SEWER SYSTEM REVENUE INDEBTEDNESS AND TO PAY FOR COSTS OF ISSUANCE.

ON MARCH 1, 20__, or any date thereafter, the unpaid installments of principal of this Bond may be prepaid or redeemed prior to their scheduled due dates, at the option of the Issuer, with funds derived from any available source, as a whole, or in part, and, if in part, the Issuer shall select and designate the maturity, or maturities, and the amount that is to be redeemed, and if less than a whole maturity is to be called, the Issuer shall direct the Paying Agent/Registrar to call by lot (provided that a portion of this Bond may be redeemed only in an integral multiple of $5,000), at the redemption price of the principal amount, plus accrued interest to the date fixed for prepayment or redemption.

THIS BOND OR ANY PORTION OR PORTIONS HEREOF IN ANY INTEGRAL MULTIPLE OF $5,000 may be assigned and shall be transferred only in the Registration Books of the Issuer kept by the Paying Agent/Registrar acting in the capacity of registrar for the Bonds, upon the terms and conditions set forth in the Bond Ordinance. Among other requirements for such assignment and transfer, this Bond must be presented and surrendered to the Paying Agent/Registrar, together with proper instruments of assignment, in form and with guarantee of signatures satisfactory to the Paying Agent/Registrar, evidencing assignment of this Bond or any portion or portions hereof in any integral multiple of $5,000 to the assignee or assignees in whose name or names this Bond or any such portion or portions hereof is or are to be transferred and registered. The form of Assignment printed or endorsed on this Bond shall be executed by the registered owner or its duly authorized attorney or representative, to evidence the assignment hereof. A new Bond or Bonds payable to such assignee or assignees (which then will be the new registered owner or owners of such new Bond or Bonds), or to the previous registered owner in the case of the assignment and transfer of only a portion of this Bond, may be delivered by the Paying Agent/Registrar in conversion of and exchange for this Bond, all in the form and manner as provided in the next paragraph hereof for the conversion and exchange of other Bonds. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for making such transfer, but the one requesting such transfer shall pay any taxes or other governmental charges required to be paid with respect thereto. The Paying Agent/Registrar shall not be required to make transfers of registration of this

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Bond or any portion hereof (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or any portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date. The registered owner of this Bond shall be deemed and treated by the Issuer and the Paying Agent/Registrar as the absolute owner hereof for all purposes, including payment and discharge of liability upon this Bond to the extent of such payment, and the Issuer and the Paying Agent/Registrar shall not be affected by any notice to the contrary.

ALL BONDS OF THIS SERIES are issuable solely as fully registered bonds, without interest coupons, in the denomination of any integral multiple of $5,000. As provided in the Bond Ordinance, this Bond, or any unredeemed portion hereof, may, at the request of the registered owner or the assignee or assignees hereof, be converted into and exchanged for a like aggregate principal amount of fully registered bonds, without interest coupons, payable to the appropriate registered owner, assignee, or assignees, as the case may be, having the same maturity date, and bearing interest at the same rate, in any denomination or denominations in any integral multiple of $5,000 as requested in writing by the appropriate registered owner, assignee, or assignees, as the case may be, upon surrender of this Bond to the Paying Agent/Registrar for cancellation, all in accordance with the form and procedures set forth in the Bond Ordinance. The Issuer shall pay the Paying Agent/Registrar's standard or customary fees and charges for transferring, converting, and exchanging any Bond or any portion thereof, but the one requesting such transfer, conversion, and exchange shall pay any taxes or governmental charges required to be paid with respect thereto as a condition precedent to the exercise of such privilege of conversion and exchange. The Paying Agent/Registrar shall not be required to make any such conversion and exchange (i) during the period commencing with the close of business on any Record Date and ending with the opening of business on the next following principal or interest payment date, or, (ii) with respect to any Bond or portion thereof called for redemption prior to maturity, within 45 days prior to its redemption date.

IN THE EVENT any Paying Agent/Registrar for the Bonds is changed by the Issuer, resigns, or otherwise ceases to act as such, the Issuer has covenanted in the Bond Ordinance that it promptly will appoint a competent and legally qualified substitute therefor, and promptly will cause written notice thereof to be mailed to the registered owners of the Bonds.

IT IS HEREBY certified, recited, and covenanted that this Bond has been duly and validly authorized, issued, and delivered pursuant to the laws of the State of Texas; that all acts, conditions, and things required or proper to be performed, exist, and be done precedent to or in the authorization, issuance, and delivery of this Bond and the Series of which it is a part have been performed, existed, and been done in accordance with law; that this Bond is a special obligation of said Issuer, and that the principal of and interest on this Bond, together with other outstanding Previously Issued Parity Bonds, as defined in the Bond Ordinance, of the Issuer, are payable and secured by a first lien on and pledge of the Pledged Revenues as defined in the Bond Ordinance.

THE ISSUER has reserved the right, subject to the restrictions stated, and adopted by reference, in the Ordinance authorizing this Series of Bonds, to issue additional parity revenue bonds which also may be made payable from, and secured by a first lien on and pledge of, the aforesaid Pledged Revenues.

THE ISSUER also has reserved the right, subject to the restrictions stated in the Bond Ordinance, to amend the Bond Ordinance.

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THE REGISTERED OWNER HEREOF shall never have the right to demand payment of this Bond or the interest hereon out of any funds raised or to be raised by taxation, or from any sources whatsoever other than those described in the Bond Ordinance.

BY BECOMING the registered owner of this Bond, the registered owner thereby acknowledges all of the terms and provisions of the Bond Ordinance, agrees to be bound by such terms and provisions, acknowledges that the Bond Ordinance is duly recorded and available for inspection in the official minutes and records of the governing body of the Issuer, and agrees that the terms and provisions of this Bond and the Bond Ordinance constitute a contract between each registered owner hereof and the Issuer.

IN WITNESS WHEREOF, the Issuer has caused this Bond to be signed with the manual or facsimile signature of the Mayor of the Issuer and countersigned with the manual or facsimile signature of the City Secretary of the Issuer, and has caused the official seal of the Issuer to be duly impressed, or placed in facsimile, on this Bond.

City Secretary Mayor

(CITY SEAL)

FORM OF PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE

PAYING AGENT/REGISTRAR'S AUTHENTICATION CERTIFICATE

(To be executed if this Bond is not accompanied by an executed Registration Certificate of the Comptroller of Public Accounts of the State of Texas)

It is hereby certified that this Bond has been issued under the provisions of the Bond Ordinance described in the text of this Bond; and that this Bond has been issued in conversion or replacement of, or in exchange for, a bond, bonds, or a portion of a bond or bonds of a Series which originally was approved by the Attorney General of the State of Texas and registered by the Comptroller of Public Accounts of the State of Texas.

Dated ______________________________________________

ByAuthorized Representative

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FORM OF ASSIGNMENT:

ASSIGNMENT

FOR VALUE RECEIVED, the undersigned registered owner of this Bond, or duly authorized representative or attorney thereof, hereby assigns this Bond to

(Assignee's Social Security or Tax Payer Identification Number)

(Print or type Assignee's Name and Address Including Zip Code)

and hereby irrevocably constitutes and appoints

Attorney, to transfer the registration of this Bond on the Paying Agent/Registrar's Registration Books with full power of substitution in the premises.

Dated _______________

NOTICE: This signature must be guaranteed by a member of the New York Stock Exchange or a commercial bank or trust company.

NOTICE: This signature must correspond with the name of the Registered Owner appearing on the face of this Bond in every particular without alteration or enlargement or any change whatsoever.

Section 8. DEFINITIONS. As used in this Ordinance, the following terms shall have the meaning as set forth below, unless the text hereof specifically indicates otherwise:

(a) "Additional Bonds" means the additional parity revenue bonds which the City reserves the right to issue in the future, as provided in Sections 22 and 23 of this Ordinance.

(b) "Bonds" means the New Series 2016 Bonds authorized by this Ordinance.

(c) "Gross Revenues of the System" or "Gross Revenues" means all revenues, income, and receipts of every nature derived or received by the City from the operation and ownership of the Combined Waterworks System and Sewer System.

(d) "Net Revenues of the System" or "Net Revenues" means all Gross Revenues of the System after deducting and paying the current expenses of operation and maintenance of the System, as required by Chapter 1502, Texas Government Code, as amended, including all salaries, labor, materials, repairs, and extensions necessary to render efficient service, provided; however, that only such repairs and extensions, as in the judgment of the City, reasonably and fairly exercised by the adoption of appropriate resolutions, are necessary to keep the System in operation and render adequate service to said City and the inhabitants thereof, or such as might be necessary to meet some physical accident or condition which would otherwise impair the Parity Bonds, shall be deducted in determining "Net Revenues of the System." Depreciation shall never be considered as an expense of operation and maintenance.

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(e) “New Series Bonds” means the New Series 2010 Bonds, the New Series 2011 Bonds, the New Series 2012 Bonds, the New Series 2013 Refunding Bonds, the New Series 2013 Bonds, the New Series 2014 Bonds, the New Series 2015 Bonds and the Bonds.

(e) "Parity Bonds" means collectively the Previously Issued Parity Bonds, the Bonds, and any Additional Bonds

(f) "Pledged Revenues" means (1) the Net Revenues of the System, plus (2) any additional revenues, income, receipts, or other resources, including, without limitation, any grants, donations, or income received or to be received from the United States Government, or any other public or private source, whether pursuant to an agreement or otherwise, which hereafter may be pledged to the payment of the Parity Bonds.

(g) "Previously Issued Parity Bonds" means collectively the Prior Series Bonds, the New Series 2010 Bonds, the New Series 2011 Bonds, the New Series 2012 Bonds, the New Series 2013 Refunding Bonds, the New Series 2013 Bonds, the New Series 2014 Bonds and the New Series 2015 Bonds.

(h) “Prior Series Bonds” means the Series 2007 Bonds.

(i) “Subordinate Lien Bonds” mean the City’s outstanding:

(i) City of Laredo, Texas Subordinate Waterworks and Sewer System Revenue Bonds, Series 2008, dated September 1, 2008; and

(ii) City of Laredo, Texas Subordinate Waterworks and Sewer System Revenue Bonds, Series 2009, dated December 1, 2009; and

(iii) City of Laredo, Texas Subordinate Waterworks and Sewer System Revenue Bonds, Series 2012, dated July 1, 2012.

(i) "System"' or "Combined Waterworks System and Sewer System" means and includes the Issuer's existing sanitary sewer system and waterworks system, together with all future extensions, improvements, enlargements, and additions thereto, and all replacements thereof, provided, however, that, notwithstanding the foregoing, and to the extent now or hereafter authorized or permitted by law, the termSystem shall not include any sewer facilities and/or waterworks system which are declared not to be a part of the System and which are acquired or constructed by the Issuer with the proceeds from the issuance of "Special Facilities Bonds”.

(j) "year" means the fiscal year used in connection with the operation of the System.

Section 9. PLEDGE. The Bonds are and shall be secured by and payable from an irrevocable first lien on and pledge of the Pledged Revenues (which includes specifically an irrevocable first lien on and pledge of the Net Revenue of the System), on a parity with the Previously Issued Parity Bonds. The Pledged Revenues are further pledged irrevocably to the establishment and maintenance of the Bond Fund and the Reserve Fund heretofore created pursuant to the ordinances authorizing the Previously Issued Parity Bonds and authorized to be maintained pursuant to this Ordinance. The Previously Issued Parity Bonds and the Bonds are not secured by or payable from a mortgage or deed of trust on any real, personal, or mixed properties constituting the System.

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Section 10. MANAGEMENT OF THE SYSTEM. The City Council has assumed management and control for the System in accordance with Chapter 1502, Texas Government Code. All of the Funds established by the ordinances for the Parity Bonds shall now include the combined waterworks system and sewer system.

Section 11. APPLICATION OF REVENUES. (a) The City has created, established, and maintained a special fund with its official depository, to be entitled the "City of Laredo Waterworks and Sewer System Revenue Fund" (the "Revenue Fund").

(b) All Gross Revenues of the System shall be deposited from day to day as collected into the Revenue Fund, and the reasonable, necessary, and proper current expenses of operation and maintenance of the System shall be paid from the Revenue Fund as a first charge thereon. The Net Revenues of the System shall be transferred and deposited by the Issuer from the Revenue Fund into the Bond Fund and the Reserve Fund created and established by this ordinance, in the manner and amounts hereinafter provided, and each of such Funds shall have priority as to such deposits in the order in which they are treated in the following sections.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 11 shall be replaced in its entirety with the following italicized language:

Section 11. APPLICATION OF REVENUES. The City hereby covenants, agrees, and establishes that the Gross Revenues shall be deposited by the City, as collected and received, into a separate account (hereby created, established, and to be maintained with the official depository of the City) known as the "City of Laredo Waterworks and Sewer System Revenue Fund" (the “Revenue Fund”) and that the Gross Revenues shall be kept separate and apart from all other funds of the City. All Gross Revenues deposited into the Revenue Fund shall be pledged and appropriated to the extent required for the following uses and in the order of priority shown:

FIRST: to the payment of all necessary and reasonable maintenance and operating expenses of the System as defined herein in Section 8 within the definition of “Net Revenues”, to be a first charge on and claim against the Gross Revenues.

SECOND: to the payment of the amounts required to be deposited into the Bond Fund created and established for the payment of the Parity Bonds as the same become due and payable.

THIRD: to the payment of the amounts required to be deposited into the Reserve Fund and other debt service reserves for Parity Bonds created and established in accordance with Section 13 of this Ordinance to maintain the amounts required to be deposited in accordance with the provisions of this Ordinance or the ordinances relating to the issuance of any Additional Bonds.

FOURTH: to the payment of the amounts required to be deposited into the debt service fund created and established for the payment of the currently outstanding Subordinate Lien Bonds or any subordinate lien obligations hereafter issued by the City, which the City has specifically reserved the right to issue under Section 24(f) of this Ordinance, as the same become due and payable.

FIFTH: to the payment of the amounts required to be deposited into any reserve fund created and established in relation to the currently outstanding Subordinate Lien Bonds or any additional subordinate lien obligations hereafter issued by the City.

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SIXTH: to the payment of the amount to replenish the Operating Reserve Fund created and established by Section 18 hereof.

SEVENTH: to the payment of the accrual to fund or to replenish the Repair and Replacement Fund created and established by Section 19 hereof.

EIGHTH: to the payment of the accrual to fund or to replenish the Emergency Reserve Fund created and established by Section 20 hereof.

NINTH: any other lawful purpose.

Section 12. BOND FUND. For the sole purpose of paying the principal of and interest on all Parity Bonds as the same come due, there has been created, and the Issuer shall establish and maintain at an official depository of the Issuer, a separate fund to be entitled the "City of Laredo Waterworks and Sewer System Bond Fund" (the "Bond Fund").

Section 13. RESERVE FUND. There has been created, and the Issuer shall establish and maintain at an official depository of the Issuer, a separate fund to be entitled the "City of Laredo Waterworks and Sewer System Bond Reserve Fund (the "Reserve Fund"). The Reserve Fund shall be used solely for the purpose of finally retiring the last of the outstanding Parity Bonds, or for paying principal of and interest on any outstanding Parity Bonds when and to the extent the amount in the Bond Fund is insufficient for such purpose.

Section 14. INVESTMENTS. Money in any Fund established pursuant to this Ordinance may be placed in time deposits or be invested in direct obligations of the United States of America, obligations guaranteed or insured by the United States of America, which, in the opinion of the AttorneyGeneral of the United States, are backed by its full faith and credit or represent its general obligations, or be invested in direct obligations of the United States of America, including, but not limited to, evidences of indebtedness issued, insured, or guaranteed by such governmental agencies as the Federal Land Banks, Federal Intermediate Credit Banks, Banks for Cooperatives, Federal Home Loan Banks, Government National Mortgage Association, United States Postal Service, Farmers Home Administration, Federal Housing Association, or Participation Certificates in the Federal Assets Financing Trust; provided that all such deposits and investments shall be made in such manner that the money required to be expended from any Fund will be available at the proper time or times. Such investment shall be valued in terms of current market value annually as of the 15th day of January of each year. Interest and income derived from such deposits and investments shall be credited to the Fund from which the deposit or investment was made. Such investments shall be sold promptly when necessary to prevent any default in connection with the Parity Bonds.


Section 14. INVESTMENTS. Money in any Fund established pursuant to this Ordinance may be invested in any security or obligation or combination thereof permitted under the Public Funds Investments Act, Chapter 2256, Texas Government Code, as amended; provided that all such deposits and investments shall be made in such manner that the money required to be expended from any Fund will be available at the proper time or times. Such investment shall be valued in terms of current market value annually as of the 15th day of January of each year. Interest and income derived from such deposits and investments shall be credited to the Fund from which the deposit or investment was made. Such

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investments in any Fund shall be sold promptly when necessary to prevent any default in connection with the Parity Bonds.

Section 15. FUNDS SECURED. Money in all Funds created by this Ordinance, to the extent not invested, shall be secured in the manner prescribed by law for securing funds of the Issuer, in principal amounts at all times not less than the amounts of money credited to such Funds, respectively.

Section 16. DEBT SERVICE REQUIREMENTS. (a) Immediately after the delivery of the Bonds, the Issuer shall deposit any accrued interest received as proceeds from the sale and delivery of the Bonds to the credit of the Bond Fund.

(b) The Issuer shall transfer from the Pledged Revenues and deposit to the credit of the Bond Fund the amounts, at the time, as follows:

(i) Such amounts, deposited in approximately equal monthly installments on or before the 20th day of each month as will be sufficient, together with other amounts, if any, then on hand in the Bond Fund and available for such purpose, to pay the interest scheduled to accrue and come due on the Parity Bonds on the next succeeding interest payment date; and

(ii) Such amounts, deposited in approximately equal monthly installments on or before the 20th day of each month as will be sufficient, together with other amounts, if any, then on hand in the Bond Fund and available for such purpose, to pay the principal scheduled to mature and come due on the Parity Bonds (whether by maturity or earlier mandatory sinking fund redemption) on the next succeeding principal payment date.

(c) Article 1208, Government Code, applies to the issuance of the Bonds and the pledge of the revenues granted by the Issuer under this Section, and is therefore valid, effective, and perfected. Should Texas law be amended at any time while the Bonds are outstanding and unpaid, the result of such amendment being that the pledge of the revenues granted by the Issuer under this Section is to be subject to the filing requirements of Chapter 9, Business & Commerce Code, in order to preserve to the registered owners of the Bonds a security interest in said pledge, the Issuer agrees to take such measures as it determines are reasonable and necessary under Texas law to comply with the applicable provisions of Chapter 9, Business & Commerce Code and enable a filing of a security interest in said pledge to occur.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 16 shall be amended by the addition of the following new Sub-section (d) shown in italicized language:

(d) If on any occasion there should not be sufficient Pledged Revenues to make the required deposits into the Bond Fund, then such deficiency shall be made up as soon as possible from the next available Pledged Revenues, or from any other sources available for such purpose.

Section 17. RESERVE REQUIREMENTS. So long as any of any Previously Issued Parity Bonds or Bonds are outstanding and unpaid, there shall be maintained in the Reserve Fund an amount at least equal to the average annual principal and interest requirement on the outstanding Previously Issued Parity Bonds and the Bonds, which amount constitutes the "Required Amount." The City Council hereby finds that, upon delivery of the Bonds, the amount already on deposit in the Reserve Fund is at least equal to the Required Amount, taking into consideration the issuance of the Bonds. When and so long as the money and investments in the Reserve Fund are not less in market value than the Required Amount, no deposits need be made to the credit of the Reserve Fund; but when and if the Reserve Fund at any time

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contains less than the Required Amount, then, subject and subordinate to making the required deposit to the credit of the Bond Fund, the Issuer, as required by this Ordinance, shall transfer from the Net Revenues of the System and/or any other Pledged Revenues and deposit to the credit of the Reserve Fund, monthly, on or before the 20th day of each month, a sum equal to 1/60th of the Required Amount until the Reserve Fund is restored to the Required Amount. So long as the Reserve Fund contains the Required Amount, any surplus in the Reserve Fund above the Required Amount shall be deposited to the credit of the Bond Fund.


Section 17. RESERVE REQUIREMENTS. So long as any of any Previously Issued Parity Bonds or Bonds are outstanding and unpaid, there shall be maintained in the Reserve Fund an amount at least equal to the average annual principal and interest requirement on the outstanding Previously Issued Parity Bonds and the Bonds, which amount constitutes the "Required Amount."

As and when Additional Bonds are delivered or incurred, the Required Amount shall be increased, if required, to an amount calculated in the manner provided in the first paragraph of this Section. Any additional amount required to be maintained in the Reserve Fund shall be so accumulated by the deposit of all or a portion of the necessary amount from the proceeds of the issue or other lawfully available Net Revenues deposited into the Reserve Fund immediately after the delivery of the then proposed Additional Bonds, or, at the option of the City, by the deposit of monthly installments, made on or before the business day before the 20th day of each month following the month of delivery of the then proposed Additional Bonds, of not less than 1/60th of the additional amount to be maintained in the Reserve Fund by reason of the issuance of the Additional Bonds then being issued (or 1/60th of the balance of the additional amount not deposited immediately in cash), thereby ensuring the accumulation of the appropriate Required Amount.

When and for so long as the cash and investments in the Reserve Fund equal the Required Amount, no deposits need be made to the credit of the Reserve Fund; but, if and when the Reserve Fund at any time contains less than the Required Amount (other than as the result of the issuance of Additional Bonds as provided in the preceding paragraph), the City covenants and agrees that the City shall cure the deficiency in the Required Amount by resuming the Required Reserve Fund deposits to such Fund from the Net Revenues such monthly deposits to be in amounts equal to not less than 1/60th of the Required Amount covenanted by the City to be maintained in the Reserve Fund with any such deficiency payments being made on or before the business day before the 20th day of each month until the Required Amount has been fully restored. The City further covenants and agrees that, subject only to the prior payments to be made to the Bond Fund, the Net Revenues shall be applied and appropriated and used to establish andmaintain the Required Amount and to cure any deficiency in such amounts as required by the terms of this Ordinance and any other ordinance pertaining to the issuance of Additional Bonds.

During such time as the Reserve Fund contains the Required Amount, the City may, at its option, withdraw all surplus funds in the Reserve Fund in excess of the Required Amount and deposit such surplus in the Revenue Fund; provided, however, that if such surplus amount represents Parity Obligation bond proceeds, the City shall deposit such surplus amount in the Bond Fund or use such surplus amount for any purpose for which such Parity Bonds were issued.

Notwithstanding anything in this Section to the contrary, the City (i) may elect to exclude Additional Bonds from the benefit of the Reserve Fund, in which case such Parity Bonds shall not be taken into account in calculating the amount of the Required Amount, nor shall money in the Reserve

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Fund be used to pay or provide for the payment of principal of or interest on such Parity Bonds, and (2) may elect to fund a separate debt service reserve fund for one or more series of such Additional Bonds.

If on any occasion there should not be sufficient Pledged Revenues to make the required deposits into the Reserve Fund, then such deficiency shall be made up as soon as possible from the next available Pledged Revenues, or from any other sources available for such purpose.

Section 18. DEFICIENCIES. If on any occasion there should not be sufficient Pledged Revenues to make the required deposits into the Bond Fund and the Reserve Fund, then such deficiency shall be made up as soon as possible from the next available Pledged Revenues, or from any other sources available for such purpose.


Section 18. OPERATING RESERVE FUND. The City hereby creates and establishes and covenants to maintain a special fund or account to be known as the "City of Laredo Waterworks and Sewer System Operating Reserve Fund" (the “Operating Reserve Fund”) and the Operating Reserve Fund shall be maintained at the official depository to the extent not invested. The Operating Reserve Fund shall be funded in an amount of not less than two months of budgeted maintenance and operating expenses for the current fiscal year (the “Required Operating Reserve Fund Amount”), which amount shall be funded initially with lawfully available funds of the City and shall be replenished as provided in subparagraph SIXTH of Section 11. Money on deposit in the Operating Reserve Fund shall be used for meeting contingencies of any nature in connection with the operations or maintenance of propertiesconstituting the System including, but not limited to, the replacement of any equipment relating to the System, as may be determined from time to time by the City.

When and so long as the cash and investments in the Operating Reserve Fund equals the Required Operating Reserve Fund Amount, no deposits will be required to be made to the credit of the Operating Reserve Fund; but, if and when the Operating Reserve Fund at any time contains less than the Required Operating Reserve Fund Amount, the City covenants and agrees to cure the deficiency by making monthly deposits to said Fund from Net Revenues of the System, or at the option of the City from any other lawfully available funds, such monthly deposits to be in amounts equal to not less than 1/60th of the Required Operating Reserve Fund Amount covenanted by the City to be maintained in the Operating Reserve Fund with any such deficiency payments being made on or before the business day preceding the fifteenth day of each month until the Operating Reserve Fund has been fully restored. The City further covenants and agrees that, subject only to the prior payments to be made pursuant to Section 11 hereof, Net Revenues shall be applied and appropriated and used to establish and maintain the Operating Reserve Fund or to cure any deficiency in such amounts as required by the terms of this Ordinance.

Deposits to the Operating Reserve Fund shall be made from Net Revenues after making each of the payments required by the provisions of subparagraphs FIRST through FIFTH of Section 11 hereof.

Section 19. SURPLUS REVENUES. Subject to making the required deposits to the credit of the Bond Fund and the Reserve Fund, when and as required by this Ordinance, and any ordinance or ordinances authorizing the issuance of Additional Bonds, any surplus Pledged Revenues, to the extent available, shall be used and applied as follows:

(a) first, an amount equal to not less than 5% nor more than 10%, as determined by the Issuer, of the Gross Revenues of the System for each year shall be set aside in a "Contingency and

28

Retirement Fund," and held and used by the Issuer to make extension, improvements, additions, and any other capital expenditures related to the System, or to make necessary repairs or replacements of the System, or, at the option of the Issuer, to pay any principal of or interest on any Parity Bonds; and

(b) second, for all payments made with respect to any subordinate lien bonds, which the Issuer has specifically reserved the right to issue under Section 24(f) of this Ordinance; and

(c) third, any remaining surplus Net Revenues may be used by the Issuer for any other lawful purpose.


Section 19. REPAIR AND REPLACEMENT FUND. The City hereby creates and establishes and covenants to maintain a special fund or account to be known as the "City of Laredo Waterworks and Sewer System Repair and Replacement Fund" (the “Repair and Replacement Fund”) and the Repair and Replacement Fund shall be maintained at the official depository to the extent not invested. Money on deposit in the Repair and Replacement Fund shall be used for making any capital improvements to the System and for meeting contingencies of any nature in connection with the operations, maintenance, improvement, replacement, or relocation of properties constituting the System including, but not limited to, the replacement of any equipment relating to the System, as may be determined from time to time by the City.

The Repair and Replacement Fund shall be funded in the amount equal to 2.50% of the System’s net assets for the prior fiscal year, as such amount is indicated on the City’s prior fiscal year annual financial report under Total Capital Assets (net of accumulated depreciation) (the “Repair and Replacement Fund Amount”), initially (1) in full or in part, with lawfully available funds of the City or (2) if not fully funded initially or only partially funded initially, in five equal annual installments after making the payments as required by the provisions of Section 11 of the Ordinance. The first annual payment shall be made before September 30th of the fiscal year in which the Prior Series Bonds are either defeased or no longer outstanding and on each annual anniversary thereof until the amount on deposit in the Repair and Replacement Fund equals or exceeds the Repair and Replacement Fund Amount. In the event that these annual payments are not made, the City shall establish sufficient rates and charges for the System to cure any such deficiency with respect to the accumulation of the Repair and Replacement Fund Amount within one year.

When and so long as the cash and investments in the Repair and Replacement Fund equals the Repair and Replacement Fund Amount, no deposits will be required to be made to the credit of the Repair and Replacement Fund; but, if and when the Repair and Replacement Fund at any time contains less than the Repair and Replacement Fund Amount, the City covenants and agrees to cure the deficiency in the Repair and Replacement Fund by resuming monthly deposits to said Fund from Net Revenues of the System, or at the option of the City from any other lawfully available funds, such monthly deposits to be in amounts equal to not less than 1/60th of the Repair and Replacement Fund Amount covenanted by the City to be maintained in the Repair and Replacement Fund with any such deficiency payments being made on or before the business day preceding the fifteenth day of each month until the Repair and Replacement Fund Amount has been fully restored. The City further covenants and agrees that, subject only to the prior payments to be made pursuant to Section 11 hereof, Net Revenues shall be applied and appropriated and used to establish and maintain the Repair and Replacement Fund Amount or to cure any deficiency in such amounts as required by the terms of this Ordinance.

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Deposits to the Repair and Replacement Fund shall be made from Net Revenues after making each of the payments required by the provisions of subparagraphs FIRST through SIXTH of Section 11 hereof.

Section 20. PAYMENT OF BONDS. On or before February 25, 2012, and semiannually on or before the 25th day of each February and August thereafter while any of the Parity Bonds are outstanding and unpaid, the City shall make available to the Paying Agent/Registrar therefor, out of the Bond Fund or the Reserve Fund, if necessary, money sufficient to pay such interest on and such principal of the Parity Bonds as will accrue or mature on the March 1 or September 1 immediately following. The Paying Agent/Registrar shall cancel and deliver to the Treasurer of the Issuer, or shall destroy, all paid Parity Bonds and furnish the Issuer with an appropriate certificate of cancellation or destruction.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 20 shall become Section 21 and Section 20 shall then read as shown by the following italicized language:

Section 20. THE EMERGENCY RESERVE FUND RESERVE FUND. The City hereby creates and establishes and covenants to maintain a special fund or account to be known as the "City of Laredo Emergency Reserve Fund" (the “Emergency Reserve Fund”) and the Emergency Reserve Fund shall be maintained at the official depository to the extent not invested. There shall be maintained in the Emergency Reserve Fund an amount equal to $10,000,000, which amount constitutes the "Required Emergency Reserve Amount", to be funded initially (1) in full or in part, with lawfully available funds of the City or (2) if not fully funded initially or only partially funded initially, in the manner set forth in the following paragraph, after making the payments as required by the provisions of Section 11 of the Ordinance. Money on deposit in the Emergency Reserve Fund may be used for (1) making principal and interest payments on any debt currently outstanding or incurred in the future that is payable, in whole or in part, from the revenues of the System, including self-supporting certificates of obligation; and (2) making any capital improvements to the System and for meeting contingencies of any nature in connection with the operations, maintenance, improvement, replacement, or relocation of properties constituting the System including, but not limited to, the replacement of any equipment relating to the System, as may be determined from time to time by the City.

When and so long as the cash and investments in the Emergency Reserve Fund equals the Required Emergency Reserve Amount, no deposits will be required to be made to the credit of the Emergency Reserve Fund; but, if and when the Emergency Reserve Fund at any time contains less than the Required Emergency Reserve Amount, the City covenants and agrees to cure the deficiency by making monthly deposits to said fund from Net Revenues of the System, or at the option of the City from any other lawfully available funds, such monthly deposits to be in amounts equal to not less than 1/60th of the Required Emergency Reserve Amount covenanted by the City to be maintained in the Certificates of Obligation reserve Fund with any such deficiency payments being made on or before the business day preceding the fifteenth day of each month until the Required Emergency Reserve Amount has been fully restored. The City further covenants and agrees that, subject only to the prior payments to be made pursuant to Section 11 hereof, Net Revenues shall be applied and appropriated and used to establish and maintain the Required Emergency Reserve Amount or to cure any deficiency in such amounts as required by the terms of this Ordinance.

Deposits to the Emergency Reserve Fund shall be made from Net Revenues after making each of the payments required by the provisions of subparagraphs FIRST through SEVENTH of Section 11 hereof. During such time as the Emergency Reserve Fund contains the Required Emergency Reserve

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Amount, the City may, at its option, withdraw all surplus funds in the Emergency Reserve Fund in excess of the Required Emergency Reserve Amount and utilize such excess for any lawful purpose.

Section 21. DEFEASANCE OF BONDS. (a) Any Bond and the interest thereon shall be deemed to be paid, retired, and no longer outstanding (a "Defeased Bond") within the meaning of this Ordinance, except to the extent provided in subsection (d) of this Section, when payment of the principal of such Bond, plus interest thereon to the due date (whether such due date be by reason of maturity or otherwise) either (i) shall have been made or caused to be made in accordance with the terms thereof, or (ii) shall have been provided for on or before such due date by irrevocably depositing with or making available to the Paying Agent/Registrar in accordance with an escrow agreement or other instrument (the "Future Escrow Agreement") for such payment (1) lawful money of the United States of America sufficient to make such payment or (2) Defeasance Securities that mature as to principal and interest in such amounts and at such times as will insure the availability, without reinvestment, of sufficient money to provide for such payment, and when proper arrangements have been made by the Issuer with the Paying Agent/Registrar for the payment of its services until all Defeased Bonds shall have become due and payable. At such time as a Bond shall be deemed to be a Defeased Bond hereunder, as aforesaid, such Bond and the interest thereon shall no longer be secured by, payable from, or entitled to the benefits of, the revenues herein pledged as provided in this Ordinance, and such principal and interest shall be payable solely from such money or Defeasance Securities. Notwithstanding any other provision of this Ordinance to the contrary, it is hereby provided that any determination not to redeem Defeased Bonds that is made in conjunction with the payment arrangements specified in subsection 21(a)(i) or (ii) shall not be irrevocable, provided that: (1) in the proceedings providing for such payment arrangements, the Issuer expressly reserves the right to call the Defeased Bonds for redemption; (2) gives notice of the reservation of that right to the owners of the Defeased Bonds immediately following the making of the payment arrangements; and (3) directs that notice of the reservation be included in any redemption notices that it authorizes.

(b) Any moneys so deposited with the Paying Agent/Registrar may at the written direction of the Issuer also be invested in Defeasance Securities, maturing in the amounts and times as hereinbefore set forth, and all income from such Defeasance Securities received by the Paying Agent/Registrar that is not required for the payment of the Bonds and interest thereon, with respect to which such money has been so deposited, shall be turned over to the Issuer, or deposited as directed in writing by the Issuer. Any Future Escrow Agreement pursuant to which the money and/or Defeasance Securities are held for the payment of Defeased Bonds may contain provisions permitting the investment or reinvestment of such moneys in Defeasance Securities or the substitution of other Defeasance Securities upon the satisfaction of the requirements specified in subsection 21(a)(i) or (ii). All income from such Defeasance Securities received by the Paying Agent/Registrar which is not required for the payment of the Defeased Bonds, with respect to which such money has been so deposited, shall be remitted to the Issuer or deposited as directed in writing by the Issuer.

(c) The term "Defeasance Securities" means (i) direct, noncallable obligations of the United States of America, including obligations that are unconditionally guaranteed by the United States of America, (ii) noncallable obligations of an agency or instrumentality of the United States of America, including obligations that are unconditionally guaranteed or insured by the agency or instrumentality and that, on the date of the purchase thereof are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent, and (iii) noncallable obligations of a state or an agency or a county, municipality, or other political subdivision of a state that have been refunded and that, on the date the governing body of the Issuer adopts or approves the proceedings authorizing the financial arrangements are rated as to investment quality by a nationally recognized investment rating firm not less than AAA or its equivalent.

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(d) Until all Defeased Bonds shall have become due and payable, the Paying Agent/Registrar shall perform the services of Paying Agent/Registrar for such Defeased Bonds the same as if they had not been defeased, and the Issuer shall make proper arrangements to provide and pay for such services as required by this Ordinance.

(e) In the event that the Issuer elects to defease less than all of the principal amount of Bonds of a maturity, the Paying Agent/Registrar shall select, or cause to be selected, such amount of Bonds by such random method as it deems fair and appropriate.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 21 shall become Section 22.

Section 22. ADDITIONAL BONDS. (a) The City shall have the right and power at any time, and from time to time, and in one or more series or issues, to authorize, issue, and deliver Additional Bonds, in any amounts, for any lawful purpose, including the refunding of any Bonds. Such Additional Bonds may be issued in such form and manner and under such terms and conditions, not inconsistent with this ordinance, as may be determined within the discretion of the City Council. If and when authorized, issued, and delivered in accordance with this Ordinance, such Additional Bonds shall be secured by and made payable equally and ratably on a parity with all other outstanding Parity Bonds, from an irrevocable prior lien on and pledge of the Pledged Revenues.

(b) The Bond Fund and the Reserve Fund, shall secure and be used to pay all Additional Bonds as well as the outstanding Parity Bonds. However, each Ordinance under which Additional Bonds are issued shall provide and require that, in addition to the amounts required by the provisions of this Ordinance and the provisions of any other ordinance or ordinances authorizing Additional Bonds to be transferred and deposited from Pledged Revenues to the credit of the Bond Fund, the City, shall transfer and deposit to the credit of the Bond Fund at least such amounts as are required for the payment of all principal of and interest on said Additional Bonds then being issued, as the same come due; and that the aggregate amount to be accumulated and maintained in the Reserve Fund shall be increased (if and to the extent necessary) to an amount not less than the Required Amount; and that the Required Amount shall be so accumulated by the deposit in the Reserve Fund of all or any part of said Required Amount in cash immediately after the delivery of the then proposed Additional Bonds, or by the deposit of all or any part of said Required Amount (or any balance of said Required Amount not deposited in cash as permitted above) in substantially equal periodic installments, at least annually, sufficient to accumulate the Required Amount within five years from the date of the then proposed Additional Bonds.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 22 shall become Section 23 and Sub-section 23(b) shall be replaced in its entirety with the following italicized language:

(b) Each Ordinance under which Additional Bonds are issued shall provide and require that, in addition to the amounts required by the provisions of this Ordinance and the provisions of any other ordinance or ordinances authorizing Additional Bonds to be transferred and deposited from Pledged Revenues to the credit of the Bond Fund, the City, shall transfer and deposit to the credit of the Bond Fund at least such amounts as are required for the payment of all principal of and interest on said Additional Bonds then being issued, as the same come due; and that the aggregate amount to be accumulated and maintained in the Reserve Fund shall be increased (if and to the extent necessary) to an amount not less than the Required Amount; and that the Required Amount shall be so accumulated by the deposit in the Reserve Fund of all or any part of said Required Amount in cash immediately after the

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delivery of the then proposed Additional Bonds, or, at the Option of the City, by the deposit of all or any part of said Required Amount (or any balance of said Required Amount not deposited in cash as permitted above) in substantially equal monthly installments sufficient to accumulate the Required Amount within 60 months, commencing with the second month following the month the then proposed Additional Bonds are issued.

(c) All calculations of average annual principal and interest requirements made pursuant to this Section shall be made as of and from the date of the Additional Bonds then proposed to be issued.

(d) The principal of all Additional Bonds must be scheduled to be paid or mature on March 1 and/or September 1 of the years in which such principal is scheduled to be paid or mature; and all interest thereon must be payable on March 1 or September 1.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, Sub-sections 23(e) and (f) (which will cause all requirements for additional bonds to be incorporated into Section 23) shall be added as shown by the following italicized language:

(e) Additional Bonds shall be issued only in accordance with this Ordinance, but notwithstanding any provisions of this Ordinance to the contrary, no installment, series, or issue of Additional Bonds shall be issued or delivered unless:

(i) The Mayor and the City Secretary of the City sign a written certificate to the effect that the City is not in default as to any covenant, condition, or obligation in connection with all outstanding Previously Issued Parity Bonds and Bonds, and the ordinances authorizing same, and that the Bond Fund and the Reserve Fund each contains the amount then required to be therein; provided, however, that the certification regarding no default as to any covenant, condition, or obligation in connection with all outstanding Previously Issued Parity Bonds and Bonds, and the ordinances authorizing same, shall not be necessary if the issuance of the Additional Bonds then proposed shall cure such default or defaults. And only with regard to the first series of Additional Bonds issued after all of the Prior Series Bonds are either defeased or no longer outstanding, the Mayor and the City Secretary of the City sign a written certificate to the effect that the Operating Reserve Fund has been or will be at the time of delivery of the then proposed Additional Bonds fully funded with proceeds from the prior existing Contingency and Retirement Fund or other legally available funds (this sentence shall be deleted for subsequent issues of Additional Bonds). It shall not be a prior condition or requirement for the issuance of Additional Bonds that the Operating Reserve Fund, the Repair and Replacement Fund or the Emergency Reserve Fund each contain the amount then required to be therein so long as long as the City is replenishing any missing amount in such Funds pursuant to the terms of the Ordinance.

(ii) An independent certified public accountant, or independent firm of certified public accountants, signs a written certificate to the effect that, during either the next preceding fiscal year, or any twelve consecutive calendar month period ending not more than 90 days prior to the passage of the ordinance authorizing the issuance of the then proposed Additional Bonds, the Pledged Revenues were, in his or its opinion, at least equal to 1.25 times the average annual principal and interest requirements of all Previously Issued Parity Bonds and Bonds to be outstanding after the issuance of the then proposed Additional Bonds. In making such a determination of the Pledged Revenues, the independent certified public accountant, or independent firm of certified public accountants may take into consideration a change in the rates and charges for services and facilities afforded by the System that became effective at least sixty (60) days prior to adoption of the ordinance authorizing the issuance of the Additional Bonds, and, for purposes of satisfying the Pledged Revenues test, make a pro forma determination of the Pledged Revenues for the period of time covered by this representation based on such change in rates and charges

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being in effect for the entire period covered by the independent certified public accountant’s, or independent firm of certified public accountants’ representation.

(f) The City reserves the right to issue Additional Bonds to refund all or any part of the outstanding Parity Bonds or any other obligations of the City payable, in whole or in part, from the Gross Revenues, pursuant to any law then available, upon such terms and conditions as the City Council may deem to be in the best interest of the City, its inhabitants and other customers of the System, and, unless all of the then outstanding Parity Bonds are refunded, the conditions precedent prescribed for the issuance of Additional Bonds and the representations and certifications required by this section shall be satisfied and shall give effect to the average annual principal and interest requirements of the proposed refunding Additional Bonds (but shall not give effect to the average annual principal and interest requirements of the obligations being refunded following their cancellation or provision being made for their payment); provided, however, if as a result of such refunding the average annual principal and interest requirements of all Parity Bonds to be outstanding after the issuance of the then proposed refunding Additional Bonds are not increased in any Fiscal Year, the City shall not be required to satisfy the requirements of Section 23(e)(ii) as a requirement for the issuance of such refunding Additional Bonds.

Section 23. FURTHER REQUIREMENTS FOR ADDITIONAL BONDS. Additional Bonds shall be issued only in accordance with this Ordinance, but notwithstanding any provisions of this Ordinance to the contrary, no installment, series, or issue of Additional Bonds shall be issued or delivered unless:

(a) The Mayor and the City Secretary of the City sign a written certificate to the effect that the City is not in default as to any covenant, condition, or obligation in connection with all outstanding Previously Issued Parity Bonds and Bonds, and the ordinances authorizing same, and that the Bond Fund and the Reserve Fund each contains the amount then required to be therein.

(b) An independent certified public accountant, or independent firm of certified public accountants, signs a written certificate to the effect that, during either the next preceding fiscal year, or any twelve consecutive calendar month period ending not more than 90 days prior to the passage of the ordinance authorizing the issuance of the then proposed Additional Bonds, the Pledged Revenues were, in his or its opinion, at least equal to 1.40 times the average annual principal and interest requirements of all Previously Issued Parity Bonds and Bonds to be outstanding after the issuance of the then proposed Additional Bonds.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Section 23 shall be deleted in its entirety as such provisions, as amended, shall be incorporated into the newly created Section 23.

Section 24. GENERAL COVENANTS. The City further covenants and agrees that in accordance with and to the extent required or permitted by law.

(a) Performance. The Issuer will faithfully perform and cause the City to perform at all times any and all covenants, undertakings, stipulations, and provisions contained in this Ordinance, and each ordinance authorizing the issuance of Parity Bonds, and in each and every Parity Bond; the City will promptly pay or cause to be paid the principal of and interest on every Parity Bond, on the dates and in the places and manner prescribed in such ordinances and Parity Bonds; and that it will, at the times and in the manner prescribed, deposit or cause to be deposited the amounts required to be deposited into the Bond Fund and the Reserve Fund; and any holder of the Parity Bonds may require the City, the City, their

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officials and employees, to carry out, respect, or enforce the covenants and obligations of this Ordinance, or any ordinance authorizing the issuance of Parity Bonds, by all legal and equitable means, including specifically, but without limitation, the use and filing of mandamus proceedings, in any court of competent jurisdiction, against the City, the City, their officials and employees.

(b) City's Legal Authority. The City is a duly created and existing home rule city of the State of Texas, and is duly authorized under the laws of the State of Texas to create and issue the Bonds; that all action on its part for the creation and issuance of the Bonds has been duly and effectively taken, and that the Bonds in the hands of the holders and owners thereof are and will be valid and enforceable special obligations of the City in accordance with their terms.

(c) Title. The City has or will obtain lawful title to the lands, buildings, structures, and facilities constituting the System and warrants that it will defend the title to all the aforesaid lands, buildings, structures, and facilities, and every part thereof, for the benefit of the holders and owners of the Bonds, against the claims and demands of all persons whomsoever, that it is lawfully qualified to pledge the Pledged Revenues to the payment of the Previously Issued Parity Bonds and the Bonds in the manner prescribed herein, and has lawfully exercised such rights.

(d) Liens. The City will from time to time and before the same become delinquent pay and discharge all taxes, assessments, and governmental charges, if any, which shall be lawfully imposed upon it, or the System, it will pay all lawful claims for rents, royalties, labor, materials, and supplies which if unpaid might by law become a lien or charge thereon, the lien of which would be prior to or interfere with the liens hereof so that the priority of the liens granted hereunder shall be fully preserved in the manner provided herein, and it will not create or suffer to be created any mechanic's, laborer's materialman's, or other lien or charge which might or could be prior to the liens hereof, or do or suffer any matter or thing whereby the liens hereof might or could be impaired; provided, however, that no such tax, assessment, or charge, and that no such claims which might be used as the basis of a mechanic's, laborer's, materialman's, or other lien or charge, shall be required to be paid so long as the validity of the same shall be contested in good faith by the City or the City.

(e) Operation of the System: No Free Service. While any of the Bonds or Additional Bonds are outstanding, the Issuer covenants and agrees to maintain the System in good condition and to operate this System or to cause the System to be operated by contracting parties, in an efficient manner and at reasonable expense, and that the Issuer may enter into a contract for the operation of such System. No free service of the System shall be allowed, and should the City or any of its agencies or instrumentalities make use of the services and facilities of the System, payment of the reasonable value shall be made by the City out of funds from sources other than the revenues of the System, unless made from surplus Pledged Revenues as permitted in Section 19(c) hereof.

(f) Further Encumbrance. While the Previously Issued Parity Bonds or the Bonds are outstanding and unpaid, the City shall not additionally encumber the Pledged Revenues in any manner, except as permitted in this Ordinance in connection with Additional Bonds, unless said encumbrance is made junior and subordinate in all respects to the liens, pledges, covenants, and agreements of this Ordinance; but the right of the City to issue revenue bonds payable from a subordinate lien on the Pledged Revenues is specifically recognized and retained.

(g) Sale or Disposal of Property. While the Previously Issued Parity Bonds or the Bonds are outstanding and unpaid, the City shall not sell convey, mortgage, encumber, lease, or in any manner transfer title to, or otherwise dispose of the System, or any significant or substantial part thereof, and provided that whenever the City deems it necessary to dispose of any machinery, fixtures, or equipment,

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it may sell or otherwise dispose of such machinery, fixtures, or equipment when it has made arrangement to replace the same or provide substitutes therefor, unless it is determined that no such replacement or substitute is necessary.

(h) Insurance. While any Previously Issued Parity Bonds or Bonds are outstanding, the City shall cause to be insured such part of the System as would usually be insured by corporations operating like properties, with a responsible insurance company or companies, against risks, accidents, or casualties against which and to the extent insurance is usually carried by corporations operating like properties, including, to the extent reasonably obtainable, fire and extended coverage insurance, insurance against damage by floods, and use and occupancy insurance. Public liability and property damage issuance shall also be carried unless the City Attorney gives a written opinion to the effect that the City is liable for claims which would be protected by such insurance. At any time while any contractor engaged in construction work shall be fully responsible therefor, the City shall not be required to carry insurance on the work being constructed if the contractor is required to carry appropriate insurance. All such policies shall be open to the inspection of the bondholders and their representatives at all reasonable times. Upon the happening of any loss or damage covered by insurance from one or more of said causes, the City shall make due proof of loss and shall do all things necessary or desirable to cause the insuring companies to make payment in full directly to the City. The proceeds of insurance covering such property, together with any other funds necessary and available for such purpose, shall be used forthwith by the City for repairing the property damaged or replacing the property destroyed provided, however, that if said insurance proceeds and other funds are insufficient for such purpose, then said insurance proceeds pertaining to the System shall be used promptly as follows:

(i) for the redemption prior to maturity of the Parity Bonds, ratably in the proportion that the outstanding principal of each Series or issue of such Bonds bears to the total outstanding principal of all Bonds; provided that if on any such occasion the principal of any such series or issue is not subject to redemption, it shall not be regarded as outstanding in making the foregoing computation; or

(ii) if none of the outstanding Parity Bonds is subject to redemption, then for the purchase on the open market and retirement of said Bonds in the same proportion as prescribed in the foregoing clause (i) to the extent practicable; provided that the purchase price for any such Bond shall not exceed the redemption price of such Bond on the first date upon which it becomes subject to redemption; or (iii) to the extent that the foregoing clauses (i) and (ii) cannot be complied with at the time, the insurance proceeds, or the remainder thereof shall be deposited in a special and separate trust fund, at an official depository of the City, to be designated the Insurance Account. The Insurance Account shall be held until such time as the foregoing clauses (i) and/or (ii) can be complied with, or until other funds become available which, together with the Insurance Account, will be sufficient to make the repairs or replacement originally required, whichever of said events occurs first.

The annual audit hereinafter required shall contain a section commenting on whether or not the City has complied with the requirements of this Section with respect to the maintenance of issuance, and listing all policies carried, and whether or not all insurance premiums upon the insurance polices to which reference is hereinbefore made have been paid.

(i) Rate Covenant. The City Council of the City will fix, establish, maintain, and collect such rates, charges, and fees for the use and availability of the System at all times as are necessary to produce Net Revenues of the System which, together with any other Pledged Revenues, will be (A) in an amount at least sufficient to make all payments and deposits when and as required by the Bond Ordinances, this

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Ordinance, and each ordinance authorizing the issuance of Additional Bonds to be made from Pledged Revenues or (B) in an amount each year at least equal to 1.4 times the average annual principal and interest requirements of all Parity Bonds which, at the beginning of such year, due and lawful provision had not been made for their payment, whichever of the foregoing (A) or (B) is the greater.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, this Sub-section 24(i) shall be replaced in its entirety with the following italicized language:

(i) Rate Covenant. The City Council of the City will fix, establish, maintain, and collect such rates, charges, and fees for the use and availability of the System at all times as are necessary to produce Net Revenues of the System which, together with any other Pledged Revenues, will be (A) in an amount at least sufficient to make all payments and deposits when and as required by the Bond Ordinances, this Ordinance, and each ordinance authorizing the issuance of Additional Bonds to be made from Pledged Revenues or (B) in an amount each year at least equal to 1.25 times the average annual principal and interest requirements of all Parity Bonds which, at the beginning of such year, due and lawful provision had not been made for their payment, whichever of the foregoing (A) or (B) is the greater.

(j) Records. Proper books of record and account shall be kept in which full, true, and correct entries will be made of all dealings, activities, and transactions relating to the System, the Pledged Revenues, and the funds created pursuant to this Ordinance, and all books, documents, and vouchers relating thereto shall at all reasonable times be made available for inspection upon request of any bondholder.

(k) Audits. After the close of each year while any of the Parity Bonds are outstanding, an audit will be made of the books and accounts relating to the System and the Pledged Revenues by an independent certified public accountant or an independent fm of certified public accountants. As soon as practicable after the close of each such year, and when said audit has been completed and made available to the City, a copy of such audit for the preceding year shall be mailed to any bondholder of the Previously Issued Parity Bonds who shall so request in writing. Such annual audit reports shall be provided to certain information repositories for the benefit of the bondholders of all Parity Bonds and their agents and representatives in accordance with Section 29.

(l) Governmental Agencies. The City will comply with all of the terms and conditions of any and all franchises, permits, and authorizations applicable to or necessary with respect to the System, and which have been obtained from any governmental agency; and the City has or will obtain and keep in full force and effect all franchises, permits, authorizations, and other requirements applicable to or necessary with respect to the acquisition, construction, equipment, operation, and maintenance of the System.

(m) No Competition. The City covenants that it will not grant any franchise or permit for the acquisition, construction, or operation of any competing sewer facilities which might be used as a substitute for the System's facilities, and, to the extent that it legally may, the City will prohibit any such competing facilities.

Section 25. AMENDMENT OF ORDINANCE. (a) The holders of Previously Issued Parity Bonds and Bonds aggregating in principal amount 51% of the aggregate principal amount of then outstanding Previously Issued Parity Bonds and Bonds shall have the right from time to time to approve any amendment to this Ordinance which may be deemed necessary or desirable by the City; provided, however, that nothing herein contained shall permit or be construed to permit the amendment of the terms and conditions in this ordinance or in the Previously Issued Parity Bonds and the Bonds so as to:

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(i) Make any change in the maturity of the outstanding Previously Issued Parity Bonds or Bonds;

(ii) Reduce the rate of interest home by any of the outstanding Previously Issued Parity Bonds or Bonds;

(iii) Reduce the amount of the principal payable on the outstanding Previously Issued Parity Bonds or Bonds;

(iv) Modify the terms of payment of principal of or interest on the outstanding Previously Issued Parity Bonds or Bonds, or impose any conditions with respect to such payment;

(v) Affect the rights of the holders of less than all of the Previously Issued Parity Bonds and Bonds then outstanding; or

(vi) Change the minimum percentage of the principal amount of Previously Issued Parity Bonds and Bonds necessary for consent to such amendment.

(b) If at any time the Council shall desire to amend this Ordinance under this Section, the City shall cause notice of the proposed amendment to be published in a financial newspaper or journal of general circulation in the City of New York, New York, or in the City of Austin, Texas, once during each calendar week for at least two successive calendar weeks. Such notice shall briefly set forth the nature of the proposed amendment and shall state that a copy thereof is on file at the principal office of the Paying Agent/Registrar for inspection by all holders of Parity Bonds. Such publication is not required, however, if notice in writing is given to each holder of Parity Bonds.

(c) Whenever at any time not less than 30 days, and within one year, from the date of the first publication of said notice or other service of written notice, the City shall receive an instrument or instruments executed by the holders of at least 51% in aggregate principal amount of all Previously Issued Parity Bonds and Bonds then outstanding, which instrument or instruments shall refer to the proposed amendment described in said notice and which specifically consent to and approve such amendment in substantially the form of the copy thereof on file with the Paying Agent/Registrar, the Council may pass the amendatory ordinance in substantially the same form.

(d) Upon the passage of any amendatory ordinance pursuant to the provisions of this Section, this Ordinance shall be deemed to be amended in accordance with such amendatory ordinance, and the respective rights, duties, and obligations under this Ordinance and all the holders of then outstanding Previously Issued Parity Bonds and Bonds shall thereafter be determined, exercised, and enforced hereunder, subject in all respects to such amendments.

(e) Any consent given by the holder of a Previously Issued Parity Bonds or a Bond pursuant to the provisions of this Section shall be irrevocable for a period of six months from the date of the first publication of the notice provided for in this Section, and shall be conclusive and binding upon all future holders of the same Previously Issued Parity Bonds and Bonds during such period. Such consent may be revoked at any time after six months from the date of the first publication of such notice by the holder who gave such consent, or by a successor in title, by filing notice thereof with the Paying Agent/Registrar and the City, but such revocation shall not be effective if the holders of 51% in aggregate principal amount of the then outstanding New Series Bonds as in this Section defined have, prior to the attempted revocation, consented to and approved the amendment.

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(f) For the purpose of this Section, the fact of the holding of Previously Issued Parity Bonds or Bonds by any bondholder and the amount and numbers of such Previously Issued Parity Bonds and Bonds, and the date of their holding same, may be proved by the affidavit of the person claiming to be such holder, or by a certificate executed by any trust company, bank, banker, or any other depository wherever situated showing that at the date therein mentioned such person had on deposit with such trust company, bank, banker, or other depository, the Previously Issued Parity Bonds and Bonds described in such certificate. The City may conclusively assume that such ownership continues until written notice to the contrary is served upon it.

At such time that all of the Prior Series Bonds are either defeased or no longer outstanding, Sub-section 25(g) shall be added as shown by the following italicized language:

(g) The foregoing provisions of this Section notwithstanding, including subsection (b), the City by action of the City Council, and without the requirement of prior consent from any of the holders of Previously Issued Parity Bonds or the Bonds (but with the requirement of prior written consent by the Texas Water Development Board if the Texas Water Development Board shall then be the holder of any obligations of the City that are secured by the Net Revenues of the System, including subordinate lien obligations), may amend this Ordinance for any one or more of the following purposes:

(1) To add to the covenants and agreements of the City contained in this Ordinance, other covenants and agreements thereafter to be observed, grant additional rights or remedies to bondholders or to surrender, restrict or limit any right or power herein reserved to or conferred upon the City;

(2) To make such provisions for the purpose of curing any ambiguity, or curing, correcting or supplementing any defective provision contained in this Ordinance, or in regard to clarifying matters or questions arising under this Ordinance, as are necessary or desirable and not contrary to or inconsistent with this Ordinance and which shall not adversely affect the interests of the holders of the Parity Bonds;

(3) To make any changes or amendments requested by any Rating Agency, as a condition to the issuance or maintenance of a rating, which changes or amendments do not, in the judgment of the City, materially adversely affect the interests of the owners of the outstanding Parity Bonds;

Notice of any such amendment may be published or given by the City in the manner described in subsection (b) of this Section; provided, however, that the publication of such notice shall not constitute a condition precedent to the adoption of such amendatory ordinance and the failure to publish such notice shall not adversely affect the implementation of such amendment as adopted pursuant to such amendatory ordinance.

Section 26. DAMAGED, MUTILATED, LOST, STOLEN, OR DESTROYED BONDS. (a) Replacement Bonds. In the event any outstanding Bond is damaged, mutilated, lost, stolen, or destroyed, the Paying Agent/Registrar shall cause to be printed, executed, and delivered, a new bond of the same principal amount, maturity, and interest rate, as the damaged, mutilated, lost, stolen, or destroyed Bond, in replacement for such Bond in the manner hereinafter provided.

(b) Application for Replacement Bonds. Application for replacement of damaged, mutilated, lost, stolen, or destroyed Bonds shall be made by the registered owner thereof to the Paying Agent/Registrar. In every case of loss, theft, or destruction of a Bond, the registered owner applying for a replacement bond shall furnish to the Issuer and to the Paying Agent/Registrar such security or indemnity as may be required by them to save each of them harmless from any loss or damage with respect thereto.

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Also, in every case of loss, theft, or destruction of a Bond, the registered owner shall furnish to the Issuer and to the Paying Agent/Registrar evidence to their satisfaction of the loss, theft, or destruction of such Bond, as the case may be. In every case of damage or mutilation of a Bond, the registered owner shall surrender to the Paying Agent/Registrar for cancellation the Bond so damaged or mutilated.

(c) No Default Occurred. Notwithstanding the foregoing provisions of this Section, in the event any such Bond shall have matured, and no default has occurred which is then continuing in the payment of the principal of, redemption premium, if any, or interest on the Bond, the Issuer may authorize the payment of the same (without surrender thereof except in the case of a damaged or mutilated Bond) instead of issuing a replacement Bond, provided security or indemnity is furnished as above provided in this Section.

(d) Charge for Issuing Replacement Bonds. Prior to the issuance of any replacement bond, the Paying Agent/Registrar shall charge the registered owner of such Bond with all legal, printing, and other expenses in connection therewith. Every replacement bond issued pursuant to the provisions of this Section by virtue of the fact that any Bond is lost, stolen, or destroyed shall constitute a contractual obligation of the Issuer whether or not the lost, stolen, or destroyed Bond shall be found at any time, or be enforceable by anyone, and shall be entitled to all the benefits of this Ordinance equally and proportionately with any and all other Bonds duly issued under this Ordinance.

(e) Authority for Issuing Replacement Bonds. In accordance with Chapter 1207, this Section 26 of this Ordinance shall constitute authority for the issuance of any such replacement bond without necessity of further action by the governing body of the Issuer or any other body or person, and the duty of the replacement of such bonds is hereby authorized and imposed upon the Paying Agent/Registrar, and the Paying Agent/Registrar shall authenticate and deliver such Bonds in the form and manner and with the effect, as provided in Section 6(d) of this Ordinance for Bonds issued in conversion and exchange for other Bonds.

Section 27. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION; CUSIP NUMBERS AND CONTINGENT INSURANCE PROVISION, IF OBTAINED. The Mayor of the Issuer is hereby authorized to have control of the Initial Bond issued hereunder and all necessary records and proceedings pertaining to the Initial Bond pending its delivery and its investigation, examination, and approval by the Attorney General of the State of Texas, and its registration by the Comptroller of Public Accounts of the State of Texas. Upon registration of the Initial Bond said Comptroller of Public Accounts (or a deputy designated in writing to act for said Comptroller) shall manually sign the Comptroller's Registration Certificate on the Initial Bond, and the seal of said Comptroller shall be impressed, or placed in facsimile, on the Initial Bond. The approving legal opinion of the Issuer's Bond Counsel and the assigned CUSIP numbers may, at the option of the Issuer, be printed on the Initial Bond or on any Bonds issued and delivered in conversion of and exchange or replacement of any Bond, but neither shall have any legal effect, and shall be solely for the convenience and information of the registered owners of the Bonds. In addition, if bond insurance is obtained, the Bonds may bear an appropriate legend as provided by the insurer.

Section 28. COVENANTS REGARDING TAX EXEMPTION. (a) Covenants. The Issuer covenants to take any action necessary to assure, or refrain from any action that would adversely affect, the treatment of the Bonds as obligations described in section 103 of the Code, the interest on which is not includable in the "gross income" of the Bonds holder for purposes of federal income taxation. In furtherance thereof, the Issuer covenants as follows:

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(1) to take any action to assure that no more than 10 percent of the proceeds of the Bonds (less amounts deposited to a reserve fund, if any) are used for any "private business use," as defined in section 141(b)(6) of the Code or, if more than 10 percent of the proceeds or the projects financed therewith are so used, such amounts, whether or not received by the Issuer, with respect to such private business use, do not, under the terms of this Ordinance or any underlying arrangement, directly or indirectly, secure or provide for the payment of more than 10 percent of the debt service on the Bonds, in contravention of section 141(b)(2) of the Code;

(2) to take any action to assure that in the event that the "private business use" described in subsection (1) hereof exceeds 5 percent of the proceeds of the Bonds or the projects financed therewith (less amounts deposited into a reserve fund, if any) then the amount in excess of 5 percent is used for a "private business use" that is "related" and not "disproportionate," within the meaning of section 141(b)(3) of the Code, to the governmental use;

(3) to take any action to assure that no amount that is greater than the lesser of $5,000,000, or 5 percent of the proceeds of the Bonds (less amounts deposited into a reserve fund, if any) is directly or indirectly used to finance loans to persons, other than state or local governmental units, in contravention of section 141(c) of the Code;

(4) to refrain from taking any action that would otherwise result in the Bonds being treated as "private activity bonds" within the meaning of section 141(b) of the Code;

(5) to refrain from taking any action that would result in the Bonds being "federally guaranteed" within the meaning of section 149(b) of the Code;

(6) to refrain from using any portion of the proceeds of the Bonds, directly or indirectly, to acquire or to replace funds that were used, directly or indirectly, to acquire investment property (as defined in section 148(b)(2) of the Code) that produces a materially higher yield over the term of the Bonds, other than investment property acquired with –

(A) proceeds of the Bonds invested for a reasonable temporary period of 3 years or less or, in the case of a refunding bond, for a period of 30 days or less until such proceeds are needed for the purpose for which the Bonds are issued,

(B) amounts invested in a bona fide debt service fund, within the meaning of section 1.148-1(b) of the Treasury Regulations, and

(C) amounts deposited in any reasonably required reserve or replacement fund to the extent such amounts do not exceed 10 percent of the proceeds of the Bonds;

(7) to otherwise restrict the use of the proceeds of the Bonds or amounts treated as proceeds of the Bonds, as may be necessary, so that the Bonds do not otherwise contravene the requirements of section 148 of the Code (relating to arbitrage) and, to the extent applicable, section 149(d) of the Code (relating to advance refundings); and

(8) to pay to the United States of America at least once during each five-year period (beginning on the date of delivery of the Bonds) an amount that is at least equal to 90 percent of the "Excess Earnings," within the meaning of section 148(f) of the Code and to pay to the United States of America, not later than 60 days after the Bonds have been paid in full, 100 percent of

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the amount then required to be paid as a result of Excess Earnings under section 148(f) of the Code.

(b) Rebate Fund. In order to facilitate compliance with the above covenant (a)(8), a "Rebate Fund" is hereby established by the Issuer for the sole benefit of the United States of America, and such Fund shall not be subject to the claim of any other person, including without limitation the Bondholders. The Rebate Fund is established for the additional purpose of compliance with section 148 of the Code.

(c) Use of Proceeds. For purposes of the foregoing covenants (a)(1) and (a)(2), the Issuer understands that the term "proceeds" includes "disposition proceeds" as defined in the Treasury Regulations and, in the case of refunding Bonds, transferred proceeds (if any) and proceeds of the refunded Bonds expended prior to the date of issuance of the Bonds. It is the understanding of the Issuer that the covenants contained herein are intended to assure compliance with the Code and any regulations or rulings promulgated by the U.S. Department of the Treasury pursuant thereto. In the event that regulations or rulings are hereafter promulgated that modify or expand provisions of the Code, as applicable to the Bonds, the Issuer will not be required to comply with any covenant contained herein to the extent that such failure to comply, in the opinion of nationally recognized bond counsel, will not adversely affect the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In the event that regulations or rulings are hereafter promulgated that impose additional requirements applicable to the Bonds, the Issuer agrees to comply with the additional requirements to the extent necessary, in the opinion of nationally recognized bond counsel, to preserve the exemption from federal income taxation of interest on the Bonds under section 103 of the Code. In furtherance of such intention, the Issuer hereby authorizes and directs the Mayor to execute any documents, certificates or reports required by the Code and to make such elections, on behalf of the Issuer, that may be permitted by the Code as are consistent with the purpose for the issuance of the Bonds.

Section 29. ALLOCATION OF, AND LIMITATION ON, EXPENDITURES FOR THE PROJECT. The Issuer covenants to account for the expenditure of sale proceeds and investment earnings to be used for the purposes described in Section 1 of this Ordinance (the "Project") on its books and records in accordance with the requirements of the Internal Revenue Code. The Issuer recognizes that in order for the proceeds to be considered used for the reimbursement of costs, the proceeds must be allocated to expenditures within 18 months of the later of the date that (1) the expenditure is made, or (2) the Project is completed; but in no event later than three years after the date on which the original expenditure is paid. The foregoing notwithstanding, the Issuer recognizes that in order for proceeds to be expended under the Internal Revenue Code, the sale proceeds or investment earnings must be expended no more than 60 days after the earlier of (1) the fifth anniversary of the delivery of the Bonds, or (2) the date the Bonds are retired. The Issuer agrees to obtain the advise of nationally-recognized bond counsel if such expenditure fails to comply with the foregoing to assure that such expenditure will not adversely affect the tax-exempt status of the Bonds. For purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion that such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest.

Section 30. DISPOSITION OF PROJECT; WRITTEN PROCEDURES. (a) Disposition of Project. The Issuer covenants that the property constituting the Project financed with the proceeds of the Bonds will not be sold or otherwise disposed in a transaction resulting in the receipt by the Issuer of cash or other compensation, unless the Issuer obtains an opinion of nationally-recognized bond counsel that such sale or other disposition will not adversely affect the tax-exempt status of the Bonds. For purposes of the foregoing, the portion of the property comprising personal property and disposed in the ordinary course shall not be treated as a transaction resulting in the receipt of cash or other compensation. For purposes hereof, the Issuer shall not be obligated to comply with this covenant if it obtains an opinion that

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such failure to comply will not adversely affect the excludability for federal income tax purposes from gross income of the interest.

(b) Written Procedures. Unless superseded by another action of the City, to ensure compliance with the covenants contained herein regarding private business use, remedial actions, arbitrage and rebate, the City Council hereby adopts and establishes the instructions attached hereto as Exhibit B as the City's written procedures.

Section 31. CONTINUING DISCLOSURE.

(a) Definitions. As used in this Section, the following terms have the meanings ascribed to such terms below:

"EMMA" means the Electronic Municipal Market Access system being established by the MSRB.

"MSRB" means the Municipal Securities Rulemaking Board.

"Rule" means SEC Rule 15c2-12, as amended from time to time.

"SEC" means the United States Securities and Exchange Commission.

(b) Annual Reports. The City shall provide annually to the MSRB through EMMA within six months after the end of each fiscal year ending in or after 2015, financial information and operating data with respect to the Issuer of the general type included in the final Official Statement authorized by this Ordinance, being the information described in Exhibit C hereto. Any financial statements so to be provided shall be (1) prepared in accordance with the accounting principles described in Exhibit C hereto, or such other accounting principles as the Issuer may be required to employ from time to time pursuant to state law or regulation, and (2) audited, if the Issuer commissions an audit of such statements and the audit is completed within the period during which they must be provided. If the audit of such financial statements is not complete within such period, then the Issuer shall provide (1) unaudited financial statements for such fiscal year within such six month period, and (2) audited financial statements for the applicable fiscal year to the MSRB through EMMA when and if the audit report on such statements become available.

If the Issuer changes its fiscal year, it will notify the MSRB through EMMA of the date of the new fiscal year end prior to the next date by which the Issuer otherwise would be required to provide financial information and operating data pursuant to this paragraph (b).

The financial information and operating data to be provided pursuant to this paragraph (b) may be set forth in full in one or more documents or may be included by specific reference to any document (including an official statement or other offering document, if it is available from the MSRB) that theretofore has been provided to the MSRB through EMMA or filed with the SEC.

(c) Event Notices.

(i) The Issuer shall notify the MSRB through EMMA in an electronic format as prescribed by the MSRB, in a timely manner (but not in excess of ten business days after the occurrence of the event) of any of the following events with respect to the Bonds, if such event is material within the meaning of the federal securities laws:

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1. Non-payment related defaults;2. Modifications to rights of Certificateholders;

3. Bond calls;

4. Release, substitution, or sale of property securing repayment of the Bonds;

5. The consummation of a merger, consolidation, or acquisition involving an obligated person or the sale of all or substantially all of the assets of the obligated person, other than in the ordinary course of business, the entry into a definitive agreement to undertake such an action or the termination of a definitive agreement relating to any such actions, other than pursuant to its terms; and

6. Appointment of a successor or additional trustee or the change of name of a trustee.

(ii) The Issuer shall notify the MSRB through EMMA in an electronic format as prescribed by the MSRB, in a timely manner (but not in excess of ten business days after the occurrence of the event) of any of the following events with respect to the Bonds, without regard to whether such event is considered material within the meaning of the federal securities laws:

1. Principal and interest payment delinquencies;

2. Unscheduled draws on debt service reserves reflecting financial difficulties;

3. Unscheduled draws on credit enhancements reflecting financial difficulties;

4. Substitution of credit or liquidity providers, or their failure to perform;

5. Adverse tax opinions or the issuance by the Internal Revenue Service of proposed or final determinations of taxability, Notices of Proposed Issue (IRS Form 5701-TEB) or other material notices or determinations with respect to the tax-exempt status of the Bonds, or other events affecting the tax-exempt status of the Bonds;

6. Tender offers;

7. Defeasances;

8. Rating changes; and

9. Bankruptcy, insolvency, receivership or similar event of an obligated person .

(iii) The Issuer shall notify the MSRB through EMMA, in a timely manner, of any failure by the Issuer to provide financial information or operating data in accordance with subsection (b) of this Section by the time required by such subsection.

(d) Limitations, Disclaimers, and Amendments. The Issuer shall be obligated to observe and perform the covenants specified in this Section for so long as, but only for so long as, the Issuer remains an "obligated person" with respect to the Bonds within the meaning of the Rule, except that the Issuer in any event will give notice of any deposit made in accordance with Section 21 of this Ordinance that causes Bonds no longer to be outstanding.

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The provisions of this Section are for the sole benefit of the holders and beneficial owners of the Bonds, and nothing in this Section, express or implied, shall give any benefit or any legal or equitable right, remedy, or claim hereunder to any other person. The Issuer undertakes to provide only the financial information, operating data, financial statements, and notices which it has expressly agreed to provide pursuant to this Section and does not hereby undertake to provide any other information that may be relevant or material to a complete presentation of the Issuer's financial results, condition, or prospects or hereby undertake to update any information provided in accordance with this Section or otherwise, except as expressly provided herein. The Issuer does not make any representation or warranty concerning such information or its usefulness to a decision to invest in or sell Bonds at any future date.

UNDER NO CIRCUMSTANCES SHALL THE CITY BE LIABLE TO THE HOLDER OR BENEFICIAL OWNER OF ANY CERTIFICATE OR ANY OTHER PERSON, IN CONTRACT OR TORT, FOR DAMAGES RESULTING IN WHOLE OR IN PART FROM ANY BREACH BY THE ISSUER, WHETHER NEGLIGENT OR WITHOUT FAULT ON ITS PART, OF ANY COVENANT SPECIFIED IN THIS SECTION, BUT EVERY RIGHT AND REMEDY OF ANY SUCH PERSON, IN CONTRACT OR TORT, FOR OR ON ACCOUNT OF ANY SUCH BREACH SHALL BE LIMITED TO AN ACTION FOR MANDAMUS OR SPECIFIC PERFORMANCE.

No default by the Issuer in observing or performing its obligations under this Section shall comprise a breach of or default under this Ordinance for purposes of any other provision of this Ordinance.

Nothing in this Section is intended or shall act to disclaim, waive, or otherwise limit the duties of the Issuer under federal and state securities laws.

The provisions of this Section may be amended by the Issuer from time to time to adapt to changed circumstances that arise from a change in legal requirements, a change in law, or a change in the identity, nature, status, or type of operations of the Issuer, but only if (1) the provisions of this Section, as so amended, would have permitted an underwriter to purchase or sell Bonds in the primary offering of the Bonds in compliance with the Rule, taking into account any amendments or interpretations of the Rule since such offering as well as such changed circumstances and (2) either (a) the holders of a majority in aggregate principal amount (or any greater amount required by any other provision of this Ordinance that authorizes such an amendment) of the Outstanding Bonds consent to such amendment or (b) a person that is unaffiliated with the Issuer (such as nationally recognized bond counsel) determined that such amendment will not materially impair the interest of the holders and beneficial owners of the Bonds. The Issuer may also amend or repeal the provisions of this continuing disclosure agreement if the SEC amends or repeals the applicable provision of the Rule or a court of final jurisdiction enters judgment that such provisions of the Rule are invalid, but only if and to the extent that the provisions of this sentence would not prevent an underwriter from lawfully purchasing or selling Bonds in the primary offering of the Bonds. If the Issuer so amends the provisions of this Section, it shall include with any amended financial information or operating data next provided in accordance with paragraph (b) of this Section an explanation, in narrative form, of the reason for the amendment and of the impact of any change in the type of financial information or operating data so provided.

Section 32. SALE OF INITIAL BOND. The Bonds shall be sold and delivered subject to the provisions of Section 1 and pursuant to the terms and provisions of the Purchase Contract which the Pricing Officer is hereby authorized to execute and deliver and in which the purchaser or purchasers (the "Underwriters") of the Bonds shall be designated. The Bonds shall initially be registered in the name of the purchaser thereof as set forth in the Pricing Certificate.

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Section 33. APPROVAL OF OFFICIAL STATEMENT. The Pricing Officer is hereby authorized, in the name and on behalf of the City, to approve, distribute, and deliver a preliminary official statement and a final official statement relating to the Bonds to be used by the Underwriters in the marketing of the Bonds.

Section 34. INTEREST EARNINGS ON BOND PROCEEDS. The earnings derived from the investment of proceeds from the sale of the Bonds shall be used along with other Bonds proceeds as described in Section 1 hereof; provided that after completion of such project, as financed by the original bond issue, if any of such interest earnings remain on hand, such interest earnings shall be deposited in the Interest and Sinking Fund.

Section 35. PUBLIC NOTICE. It is hereby officially found and determined that public notice of the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code.

Section 36. APPROVAL OF ESCROW AGREEMENT; REFUNDING OF REFUNDED OBLIGATIONS. Concurrently with the initial delivery of the Bonds the City shall deposit an amount from the proceeds from the sale of the Bonds and other available funds of the City, if required, with the Escrow Agent, sufficient to provide for the refunding of the Refunded Obligations, all in accordance with Chapter 1207. Attached hereto as Exhibit D is an Escrow Agreement between the City and the Escrow Agent, which is hereby approved in substantially final form, and the Mayor or Mayor Pro-Tem and City Secretary of the City are hereby authorized, for and on behalf of the City, to approve any changes in the Escrow Agreement from the form attached hereto and to execute the Escrow Agreement in final form.

Section 37. REDEMPTION OF REFUNDED OBLIGATIONS. There is attached to this Ordinance as Exhibit E, and made a part hereof for all purposes, a NOTICE OF REDEMPTION for each series of the Refunded Obligations. (Each Pricing Officer and the City Secretary are authorized to substitute a revised Exhibit E to reflect the actual maturities and principal amount of such maturities of the Refunded Obligations that are selected by a Pricing Officer to be refunded.) The City hereby exercises its option to redeem prior to maturity the Refunded Obligations described in each NOTICE OF REDEMPTION, and the Refunded Obligations are hereby called for redemption, and shall be redeemed, prior to maturity, on the date, at the place, and at the price set forth respectively therein.

As soon as practicable after the delivery of the Bonds, and in no event less than 30 days prior to the date set for redemption, a copy of each respective NOTICE OF REDEMPTION shall be sent to all registered owners of the respective Refunded Obligations by first class mail postage prepaid, addressed to such registered owners at their respective addresses shown on the registration books of the paying agent/registrar for such Refunded Obligations. In addition, as soon as practicable after the issuance and delivery of the Bonds, a copy of each respective NOTICE OF REDEMPTION shall be filed with the MSRB through EMMA in order to comply with the City's requirements under the Rule to provide notice of the occurrence of certain material events.

Section 38. EFFECTIVE DATE. Pursuant to the provisions of Section 1201.028, Texas Government Code, this Ordinance shall become effective immediately after its adoption by the City Council.

Section 39. FINDING AND AMENDMENT TO BUDGET. It is hereby officially found and determined that said meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code, and that this

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Ordinance shall become effective on final passage, and that the annual budget for this year is hereby amended to appropriate the proceeds from the Bonds for the purposes authorized herein.

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APPROVED this the 1st day of February, 2016.

_______________________________City Secretary Mayor

APPROVED:

City Attorney

SCHEDULE I

FORM OF APPROVAL CERTIFICATE

CERTIFICATE APPROVING THE FINAL TERMS OF THE BONDS

I, the City Manager of the CITY OF LAREDO, TEXAS (the "City"), pursuant to authority granted by the provisions of Section 1207.007, Texas Government Code, and by the City Council of the City in Section 1(b) of an ordinance approved by the City Council on February 1, 2016, relating to the issuance of the Bonds defined below (the "Ordinance"), hereby certify asfollows:

1. GENERAL. This Certificate is given in connection with the issuance by the City of the CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING

BONDS, NEW SERIES 2016 (the "Bonds") which, pursuant to the Ordinance, have been authorized by the City Council.

2. DEFINITIONS. All capitalized terms used in this Certificate which are not otherwise defined herein shall have the same meanings as set forth in the Ordinance.

3. DATED DATE AND AGGREGATE PRINCIPAL AMOUNT. The Bonds shall be dated ______________, 2016, and shall be issued in the aggregate principal amount of $____________.

4. PRINCIPAL AMOUNTS AND INTEREST RATES. The Bonds shall (i) mature on March 1 in each of the years and in the respective principal amounts, and (ii) bear interest from __, 2016, to their respective date of maturity at the respective interest rates, all as set forth below:

CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BONDS,

NEW SERIES 2016

MATURITY

DATE (3/1)PRINCIPAL

AMOUNT ($)INTEREST

RATE (%)MATURITY

DATE (3/1)PRINCIPAL

AMOUNT ($)INTEREST

RATE (%)

5. INTEREST ON BONDS. As provided in Section 4 of the Ordinance and in the FORM OF BONDS contained in Section 5 of the Ordinance, interest on the Bonds shall be payable on each March 1 and September 1, commencing on ___________, until stated maturity or redemption.

6. OPTIONAL REDEMPTION. The Bonds maturing on and after March 1, 20__, may be redeemed prior to their scheduled maturities, at the option of the City on March 1, 20__, or on any date thereafter at the redemption price equal to par plus accrued interest to the date fixed for redemption.

7. Initial Purchaser and Purchase Price. The Bonds shall be sold to __________________ as the initial purchaser thereof pursuant to a negotiated underwriting and shall be purchased at a price equal to $________________ (which amount is equal to par, [plus][less] a net original issue [premium][discount] on the Bonds of $______________, less Underwriters' discount of $______________), plus accrued interest on the Bonds from ____ 2016, to the date of delivery. The Initial Bond shall be registered in the name of ___________________.

8. DETERMINATION OF DEBT SERVICE SAVINGS. Pursuant to the Ordinance, the City Council authorized the issuance of the Bonds in order to "achieve a gross debt service savings and a net present value debt service savings for the benefit of the taxpayers of the City; provided, however, in no event shall Bonds be issued unless the City is able to achieve a net present value debt service savings of at least 4.00% of the principal of the Refunded Obligations." The final terms of the Bonds as set forth in this Certificate have achieved such purpose, for the issuance of the Bonds will result in a gross debt service savings of $______________ and a present value debt service savings of $____________(_______________% of the principal amount of the Refunded Obligations), after taking into account the application of accrued interest on the Bonds in the amount of $______________.

9. PAYING AGENT/REGISTRAR AND ESCROW AGENT. ___________, is hereby appointed to serve as the paying agent/registrar for the Bonds and as escrow agent for the Refunded Obligations.

10. DETERMINATION REQUIRED BY SECTION 1201.022(A)(3), TEXAS GOVERNMENT

CODE. In satisfaction of Section 1201.022(a)(3), Texas Government Code, as authorized by Section 1(d) of the Ordinance, and upon consultation with the City's Financial Advisor, the undersigned hereby determines that the final terms of the Bonds as set forth in this Certificate are in the City's best interests.


APPROVED BY CITY MANAGER OF THE CITY OF LAREDO, TEXAS ON THE_____ DAY OF ____________, 2016 IN ACCORDANCE WITH SECTION 1(B) OF THEORDINANCE.


SIGNATURE PAGE TO CERTIFICATE APPROVING FINAL TERMS OF THE CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BONDS, NEW

SERIES 2016

SCHEDULE II

FORM OF CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

I, the City Manager of the CITY OF LAREDO, TEXAS (the "City"), pursuant to authority granted by the provisions of Section 1207.007(a)(4), Texas Government Code, and by the City Council of the City in Section 1(c) of an ordinance approved by the City Council of the City on February 1, 2016, relating to the issuance of the Bonds defined below (the "Ordinance"), hereby certify as follows:

1. This Certificate is given in connection with the issuance by the City of the CITY OF LAREDO, TEXAS WATERWORKS AND SEWER SYSTEM REVENUE REFUNDING BONDS, NEW SERIES 2016 (the "Bonds") which, pursuant to the Ordinance, have been authorized by the City Council.

2. All capitalized terms used in this Certificate which are not otherwise defined herein shall have the same meanings as set forth in the Ordinance.

3. Pursuant to Section 1(c) of the Ordinance, the City Council authorized the undersigned, as the City Manager of the City, to select to be refunded with proceeds of the Bonds all or a portion of the following outstanding obligations:

Series 2007 Bonds maturing in the years 2018 through 2027New Series 2010 Bonds maturing the years 2021 through 2026, inclusive, 2030, 2035, 2040

and 2040

In accordance with such authority, and after consulting with the City's financial advisors, [I][we] hereby determine and approve the following Series 2007 Bonds and New Series 2010 Bonds to be refunded with proceeds of the Bonds, which are described as follows:

APPROVED BY THE CITY MANAGER OF THE CITY OF LAREDO, TEXAS ON THE ____ DAY OF ____________, 2016, IN ACCORDANCE WITH SECTION 1(c) OF THE ORDINANCE.


SIGNATURE PAGE TO CERTIFICATE APPROVING OUTSTANDING OBLIGATIONS SELECTED FOR REFUNDING

EXHIBIT A

FORM OF PAYING AGENT/REGISTRAR AGREEMENT

THE PAYING AGENT/REGISTRAR AGREEMENT IS OMITTED AT THIS POINT

AS IT APPEARS IN EXECUTED FORM ELSEWHERE IN THIS TRANSCRIPT.

EXHIBIT B

WRITTEN PROCEDURES RELATING TO CONTINUING COMPLIANCE WITH FEDERAL TAX COVENANTS

A. Arbitrage. With respect to the investment and expenditure of the proceeds of the Bonds, the City's chief financial officer (the "Responsible Person"), which currently is the City's Finance Director, will:

(i) monitor all amounts deposited into a sinking fund or funds (e.g., the Interest and Sinking Fund), to assure that the maximum amount invested at a yield higher than the yield on the Bonds does not exceed an amount equal to the debt service on the Bonds in the succeeding 12 month period plus a carryover amount equal to one-twelfth of the principal and interest payable on the Bonds for the immediately preceding 12-month period;

(ii) monitor the actions of the Escrow Agent to ensure compliance with the applicable provisions of the Escrow Agreement, including with respect to reinvestment of cash balances;

(iii) ensure that the applicable information return (e.g., IRS Form 8038-G, 8038-GC, or any successor forms) is timely filed with the IRS; and

(iv) assure that, unless excepted from rebate and yield restriction under section 148(f) of the Code, excess investment earnings are computed and paid to the U.S. government at such time and in such manner as directed by the IRS (A) at least every 5 years after the date of delivery of the Bonds (the "Issue Date"), and (B) within 30 days after the date the Bonds are retired.

B. Private Business Use. With respect to the use of the facilities financed or refinanced with the proceeds of the Bonds the Responsible Person will:

(i) monitor the date on which the facilities are substantially complete and available to be used for the purpose intended;

(ii) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has any contractual right (such as a lease, purchase, management or other service agreement) with respect to any portion of the facilities;

(iii) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has a right to use the output of the facilities (e.g., water, gas, electricity);

(iv) monitor whether, at any time the Bonds are outstanding, any person, other than the City, the employees of the City, the agents of the City or members of the general public has a right to use the facilities to conduct or to direct the conduct of research;

(v) determine whether, at any time the Bonds are outstanding, any person, other than the City, has a naming right for the facilities or any other contractual right granting an intangible benefit;

(vi) determine whether, at any time the Bonds are outstanding, the facilities are sold or otherwise disposed of; and

(vii) take such action as is necessary to remediate any failure to maintain compliance with the covenants contained in the Ordinance related to the public use of the facilities.

C. Record Retention. The Responsible Person will maintain or cause to be maintained all records relating to the investment and expenditure of the proceeds of the Bonds and the use of the facilities financed or refinanced thereby for a period ending three (3) years after the complete extinguishment of the Bonds. If any portion of the Bonds is refunded with the proceeds of another series of tax-exempt obligations, such records shall be maintained until the three (3) years after the refunding obligations are completely extinguished. Such records can be maintained in paper or electronic format Responsible Person.

D. The Responsible Person shall receive appropriate training regarding the City's accounting system, contract intake system, facilities management and other systems necessary to track the investment and expenditure of the proceeds and the use of the facilities financed or refinanced with the proceeds of the Bonds. The foregoing notwithstanding, the Responsible Person is authorized and instructed to retain such experienced advisors and agents as may be necessary to carry out the purposes of these instructions.

EXHIBIT C

DESCRIPTION OF ANNUAL FINANCIAL INFORMATION

The following information is referred to in Section 31 of this Ordinance.

I. Annual Financial Statements and Operating Data

The financial information and operating data with respect to the Issuer to be provided annually in accordance with such Section are as specified (and included in the Appendix or under the headings of the Official Statement and Tables referred to) below:

Tables 1 through 14 and in Appendix B

Accounting Principles

The accounting principles referred to in such Section are the accounting principles described in the notes to the financial statements referred to in paragraph 1 above.

EXHIBIT D

FORM OF ESCROW AGREEMENT

THE ESCROW AGREEMENT IS OMITTED AT THIS POINT AS IT APPEARS ELSEWHERE IN THIS TRANSCRIPT OF PROCEEDINGS

EXHIBIT E

FORM OF NOTICES OF REDEMPTION

Final Reading of Ordinances City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Jose Luis Flores

SUBJECT2016-O-010 Amending the City of Laredo FY 2016 Airport Operating and AirportConstruction Budget to appropriate revenues in the amount of $2.4 million for AirportRunway Protection Zone, appropriating said revenue to the appropriate expenditureaccounts and authorizing the City Manager to implement said budget amendment. Asamended to increase amount from $2.0 million to $2.4 million.


BACKGROUNDThe Tract of land will be utilized as RPZ for the proposed future extension of Runway17L/35R.Acquiring the Runway Protection Zone (RPZ) will show the Federal AviationAdministration (FAA) that the City of Laredo has skin in the future Runway ExtensionProject. This will enhance the City’s ability to secure FAA Grants for the runwayextension.

This project is eligible for 90% reimbursement by the Federal Aviation Administration.

COMMITTEE RECOMMENDATIONOn January 12, 2016 the Airport Advisory Board considered this item and recommendsapproval.

STAFF RECOMMENDATIONIt is recommended that this purchase be approved.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?:Source of Funds: Airport OperationsAccount #:

Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

IntergovernmentalTransferto Airport ConstructionFund

Account Number:242-3605-597.04-33

$2,400,000

Interfund Transfer fromAirport

Account Number:433-0000-393.02-42

$2,400,000

Land Account Number:433-3674-585.91-01

$2,400,000

AttachmentsORD

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AMENDING THE CITY OF LAREDO FY 2016 AIRPORT OPERATING AND AIRPORT CONSTRUCTION BUDGET TO APPROPRIATE REVENUES IN THE AMOUNT OF $2.4 MILLION FOR AIRPORT RUNWAY PROTECTION ZONE, APPROPRIATING SAID REVENUE TO THE APPROPRIATE EXPENDITURE ACCOUNTS AND AUTHORIZING THE CITY MANAGER TO IMPLEMENTSAID BUDGET AMENDMENT. AS AMENDED TO INCREASE AMOUNT TO $2.0 MILLION TO $2.4 MILLION.

WHEREAS, the City of Laredo approves and appropriates revenues in the amount of $2,400,000.00 for Airports Runway Protection Zone at the Laredo International Airport and as a support to the maintenance and operation of the Laredo International Airport; and

WHEREAS, the Airport Manager recommends that the City Council approve the proposed budget amendment to the City of Laredo FY 2016 Airport Operating and Construction Budget to appropriate revenues and to appropriate like expenditures; and

WHEREAS, the Airport Advisory Board finds that amending the budget is in the best interest of the City of Laredo; and

WHEREAS, the City Council of the City of Laredo is of the same opinion.


Section 1: The City Manager be and is hereby authorized to amend City of Laredo FY 2016 Airport Operating and Airport Construction Budget to appropriate revenues in the amount of $2,400,000.00 for Airports Runway Protection Zone, appropriating said revenue to the appropriate expenditure accounts and authorizing the City Manager to implement said budget amendment.


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PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE ______ DAY OF ______________________, 2016.

________________________PETE SAENZMAYOR

ATTEST:

______________________________DOANH “ZONE” NGUYENACTING CITY SECRETARY


______________________________RAUL CASSOCITY ATTORNEY


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Varela Insvestment Ventures, LTD; Rafael Varela, Owner/Applicant

Staff Source: Nathan R. Bratton

SUBJECT2016-O-011 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoningLots 1 and 2, and parts of Lots 7 and 8, Block 1774, Eastern Division, located at 819 SNew York Avenue, 2901 Blaine Street, from B-1 (Limited Commercial District) to B-3(Community Business District); providing for publication and effective date. District II

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Esteban Rangel at the regular Councilmeeting of January 19, 2016.

BACKGROUNDCouncil District: II – The Honorable Esteban Rangel Proposed use: Commercial Site:Commercial. Shopping center, 1-one suite (Pronto Insurance) unit, and 1-5 suite(Chiquilladas, Nails, Cricket, Color my world) units. Surrounding land uses: North of thesite across Blaine street, are single family residences. Northeast and east of the site ismostly single and multi-family residential. South of the site, across Jaime ZapataMemorial Highway, are vacant undeveloped land, Doctor’s Hospital Emergency RoomSouth and more single family residential dwellings. West of the site are Jireh Tire Shop,Perez Garage, El Rancherito Meat Market, and more single and mobile homesresidences. Comprehensive Plan: The Future Land Use Map recognizes this area asLight Commercial. Transportation Plan: The Long Range Thoroughfare Plan identifiesJaime Zapata Memorial Highway as a Freeway, south of the property. The ThoroughfarePlan does not identify New York Avenue, west of the property, or Blaine Street, north ofthe property. Letters sent to surrounding property owners: 30 In Favor: 2 Opposed: 0

COMMITTEE RECOMMENDATIONThe P & Z Commission, in a 6 to 0 vote, recommended approval of the zone change.

STAFF RECOMMENDATIONStaff supports the proposed zone change. STAFF COMMENTS Staff supports therequest for the following reasons: 1. The proposed zone change is compatible with theComprehensive Plan’s designation as Light Commercial. 2. The proposed district iscompatible with the existing zones and uses along this section of Jaime ZapataMemorial Highway. This area is following a trend of primarily light commercial. 3. The

property meets the location criteria for a B-3 district to be located along minor orprincipal arterials. The property fronts Jaime Zapata Memorial Highway to the south andhas a direct access from it. IMPACT ANALYSIS B-3 (Highway Commercial District): Thepurpose of the B-3 District (Community Business District) is to provide for thosebusinesses and services serving a trade area larger than a neighborhood, but smallerthan the entire city and located primarily along minor or principal arterial streets, asclassified in the Transportation Plan of the City of Laredo. It is intended for this zoningclassification to exist primarily abutting minor or principal arterial streets while preservingestablished residential neighborhoods along such streets Is this change contrary to theestablished land use pattern? No, the established land use pattern is primarily lightcommercial in nature. Would this change create an isolated zoning district unrelated tosurrounding districts? No, there is an existing B-3 district west of the property, acrossNew York Avenue. Will change adversely influence living conditions in theneighborhood? Yes, a B-3 district may introduce more intense uses to theneighborhood. Are there substantial reasons why the property cannot be used in accordwith existing zoning? No, the existing B-1 (Limited Commercial District) zone allows forsufficient commercial uses.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:N/A

AttachmentsOrdinance 2016-O-11Zoning MapZoning Overview MapFuture Land Use MapAerial MapSurvey Map200' Notification MapColor Pictures ZC-05-2016

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING LOTS 1 AND 2, AND PARTS OF LOTS 7 AND 8, BLOCK 1774, EASTERN DIVISION, LOCATED AT 819 S NEW YORK AVENUE, FROM B-1 (LIMITED COMMERCIALDISTRICT) TO B-3 (COMMUNITY BUSINESS DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owner of Lots 1 and 2, and parts of Lots 7 and 8, Block 1774, Eastern Division, located at 819 S New York Avenue, from B-1(Limited Commercial District) to B-3 (Community Business District); and,

WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on November 19, 2015; and,

WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the proposed zone change; and,

WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and,

WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and,

WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance; and,


Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning, Lots 1 and 2, and parts of Lots 7 and 8, Block 1774, Eastern Division, located at 819 S New York Avenue, from B-1 (Limited Commercial District) to B-3 (Community Business District).

Section 2: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo.

2

Section 3: This ordinance shall become effective as and from the date of publication specified in Section 2.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE __________ DAY OF _________________, 2016.

_____________________________________ PETE SAENZMAYOR

ATTEST:

___________________________DOANH “ZONE” T. NGUYENACTING CITY SECRETARY

APPROVED AS TO FORM:RAUL CASSOCITY ATTORNEY

____________________________KRISTINA K. LAUREL HALEASSISTANT CITY ATTORNEY

1722 1775

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99-O-167

2014-O-014

1 inch = 100 feetDate: 11/3/2015


REZONE FROMB1 (LIMITED COMMERCIAL DISTRICT)

-> B3 (COMMUNITY BUSINESS DISTRICT)819 S NEW YORK AVE


ZONING MAP

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1 inch = 500 feetDate: 11/3/2015




ZONING OVERVIEW

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EXPRESSWAY

1 inch = 100 feetDate: 11/3/2015




FUTURE LANDUSE MAP

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3003L: 1 & 2

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2719L: 5 & 6

2806L: 12& 11

805L: 13

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803L: 3

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2811L: 4 - 6

819L: 8& 7

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703L: 7& 8

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1722 1775

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1 inch = 100 feetDate: 11/3/2015




AERIAL MAP

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2715L: 3 & 4

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2719L: 5 & 6

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805L: 13

803L: 2

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803L: 3

2820L: 9 - 7

2811L: 4 - 6

819L: 8& 7

2901L: 1 & 2

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2820L: 7

2804L: 11

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3000L: 8

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3000L: 1

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3017L: 3 & 4

706L: 4

3001L: 1

703L: 7& 8

3003L: 7 & 8

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1722 1775

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1 inch = 100 feetDate: 11/3/2015




200' NOTIFICATION

0 10050Feet


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Walmart Stores Texas, LLC., Lina Brown, Owner; RMH Franchise

Holdings, Monica Smith, for Applebee's Restaurant, Applicant


SUBJECT2016-O-012 Amending the Zoning Ordinance (Map) of the City of Laredo by authorizinga Special Use Permit for a Restaurant Serving Alcohol, on Lot 2, Block 1, Walmart atSan Isidro Ranch Subdivision, located at 10719 International Boulevard; providing forpublication and effective date. District VI

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Charlie San Miguel at the regular meeting ofJanuary 19, 2016.

BACKGROUNDCouncil District: VI – The Honorable Charlie San Miguel Proposed use: RestaurantServing Alcohol Site: Vacant land. Surrounding land uses: North of the property is NEBob Bullock Loop, and across the Loop there is vacant undeveloped land. Abutting theproperty to the east is a Commercial Plaza with 5 suites (Panda Express, Pizza Patron,GNC, Great Clips and Sprint), and to the south there is more vacant land. East of theproperty is Wal-Mart. West of the property across International Blvd. are AutoZone,Murphy Express Gas Station, two vacant lots, Chase Bank, a Commercial Plaza with 5suites (Way Back Burgers, Posh Sushi, Subway, Complete Nutrition and Verizon), andDiscount Tire. Comprehensive Plan: The Future Land Use Map identifies this tract asLight Commercial. Transportation Plan: The Long Range Thoroughfare Plan identifiesNE Bob Bullock Loop as an Expressway and International Blvd. as a Minor Arterial.Letters sent to surrounding property owners: 4 In Favor: 1 Opposed: 0

COMMITTEE RECOMMENDATIONThe P & Z Commission, in a 6 to 0 vote, recommended approval of the Special UsePermit.

STAFF RECOMMENDATIONStaff supports the proposed Special Use Permit. STAFF COMMENTS A Special Use

Staff supports the proposed Special Use Permit. STAFF COMMENTS A Special UsePermit is used for those types of uses that warrant individual attention on a case by casebasis and should not be categorized in a zoning district. A Special Use Permit isbasically an overlay on top of the existing zoning designation and can be limited in manyrespects such as time, fencing, setbacks, landscaping, etc. A Special Use Permit isrequired for those restaurants located in R-O, B-1, or B-3 districts that wish to servealcoholic beverages. The property is in a B-3 (Community Business District) zoningdistrict. Staff supports the issuance of the proposed SUP at this location for the followingreasons: 1. The proposed SUP location meets distance requirements as per Ordinance2013-O-005 2. The proposed SUP is appropriate at this location because it is compatiblewith the Comprehensive Plan’s designation for the area as Light Commercial. 3. Theproposed SUP is in conformance with the surrounded uses in the area. Staff suggeststhe following conditions: 1. The Special Use Permit is issued to Wal-Mart Stores Texas,LLC and RMH Franchise Holdings for for an Applebee’s Restaurant, and isnon-transferable. 2. The Special Use Permit is restricted to the site plan, Exhibit “A”,which is made part hereof for all purposes. 3. The Special Use Permit is restricted to arestaurant serving alcohol and hours of operation from Monday through Sunday from11:00 a.m. through 2:00 a.m. 4. The establishment must make provisions to keep litter toa minimum, and to keep it from blowing onto adjacent streets and properties. 5. Signageshall be consistent with the City's Sign Ordinance and TABC rules or regulations. 6.Off-street parking shall be provided in accordance with the City of Laredo LandDevelopment Code. 7. Outdoor music and speakers shall be prohibited and there shallbe no ground vibrations created or sustained on the site which are perceptible withoutinstruments at any point on any property adjoining the subject property. 8. At all timesthe restaurant is open to the public for business; it shall continually maintain and servefood from its full service menu. 9. The restaurant shall not exceed the "Occupant Load"as set forth in the Certificate of Occupancy with Occupant Load issued to SUP businessholder. 10. The restaurant shall, during all hours of operation, maintain, free fromobstruction or impediment to full instant use in the case of fire or other emergency, allexit accesses, exits or exit discharges. 11. The restaurant shall undergo an annual FireInspection. 12. All permits, licenses, certifications and inspections required by the codesand ordinances of the City of Laredo shall be kept up to date and current including butnot limited to Food Manager License (annual), Food Handler's Permit (annual), andCertificate of Occupancy with Occupant Load, Occupant Load being the approvedcapacity of a building or portion thereof. 13. Landscaping of property shall be provided inaccordance with the City of Laredo Land Development Code. 14. Lighting of propertyshall be screened to avoid adverse impact on adjacent residential neighborhoods. 15.Owner shall provide a 7' high opaque fence along property lines which abut or adjoin anyresidential zones/uses. 16. Owner shall comply with, Building, Health, Life and Safety,and all applicable codes and regulations as required.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:

Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:N/A

AttachmentsOrdinance 2016-O-12Exhibits A & BZoning MapZoning Overview MapFuture Land Use MapAerial MapSurvey Map200' Notification MapColor Pictures ZC-07-2015

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY AUTHORIZING A SPECIAL USE PERMIT FOR A RESTAURANT SELLING ALCOHOL ON LOT 2, BLOCK 1, WALMART AT SAN ISIDRO RANCH SUBDIVISION, LOCATED AT 10719 INTERNATIONAL BOULEVARD; PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, the owner of Lot 2, Block 1, Walmart at San Isidro Ranch Subdivision, located at 10719 International Boulevard, has requested a Special Use Permit for a restaurant selling alcohol; and,

WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on December 17, 2015; and,

WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommendedapproval of the Special Use Permit request; and,

WHEREAS, notice of the request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and,

WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the proposed Special Use Permit appropriate and consistent with the General Plan of the City of Laredo; and,



Section 1: A Special Use Permit is granted for a restaurant selling alcohol on Lot 2, Block 1, Walmart at San Isidro Ranch Subdivision, located at 10719 International Boulevard.

Section 2: The Special Use Permit is restricted to the following provisions:

1. The Special Use Permit is issued to Wal-Mart Stores Texas, LLC and RMH Franchise Holding Corporation for an Applebee’s Restaurant, and is non-transferable.

2. The Special Use Permit is restricted to the site plan, Exhibit “A”, which is made part hereof for all purposes.

3. The Special Use Permit is restricted to a restaurant serving alcohol and hours of operation from Monday through Sunday from 11:00 a.m. through 2:00 a.m.

4. The establishment must make provisions to keep litter to a minimum, and to keep it from blowing onto adjacent streets and properties.

5. Signage shall be consistent with the City's Sign Ordinance and TABC rules or regulations.6. Off-street parking shall be provided in accordance with the City of Laredo Land Development

Code.

2

7. Outdoor music and speakers shall be prohibited and there shall be no ground vibrations created or sustained on the site which are perceptible without instruments at any point on any property adjoining the subject property.

8. At all times the restaurant is open to the public for business; it shall continually maintain and serve food from its full service menu.

9. The restaurant shall not exceed the "Occupant Load" as set forth in the Certificate of Occupancy with Occupant Load issued to SUP business holder.

10. The restaurant shall, during all hours of operation, maintain, free from obstruction or impediment to full instant use in the case of fire or other emergency, all exit accesses, exits or exit discharges.

11. The restaurant shall undergo an annual Fire Inspection.12. All permits, licenses, certifications and inspections required by the codes and ordinances of the City

of Laredo shall be kept up to date and current including but not limited to Food Manager License (annual), Food Handler's Permit (annual), and Certificate of Occupancy with Occupant Load, Occupant Load being the approved capacity of a building or portion thereof.

13. Landscaping of property shall be provided in accordance with the City of Laredo Land Development Code.

14. Lighting of property shall be screened to avoid adverse impact on adjacent residential neighborhoods.

15. Owner shall provide a 7' high opaque fence along property lines which abut or adjoin any residential zones/uses.

16. Owner shall comply with, Building, Health, Life and Safety, and all applicable codes and regulations as required.



Section 5: The Special Use Permit authorized by this ordinance shall be revoked pursuant tothe

Laredo Land Development Code, section 24.93.12, entitled "Enforcement and Revocation of SpecialUse Permits," according to the criteria and procedures described therein and below:

(a) Any Special Use Permit, authorized by City Council, shall be considered in noncompliance andshall be suspended or revoked and removed from the City of Laredo Zoning Map if:

(1) A court having jurisdiction or a jury find the holder of the Special Use Permit guiltyof a violation or if a holder of an SUP pleads guilty of violating:

(a.) Any requirement or term or condition of the Special Use Permit or has not conformed, atany time, with any or all of the requirements or terms or conditions as set out in the SpecialUse Permit as approved by the City Council.

(2) The activity authorized by the Special Use Permit commences prior to the institution of allConditions imposed by the Special Use Permit.

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(3) The use for which the Special Use Permit was authorized does not commence within sixmonths of the effective date of the Special Use Permit.

(a.) An extension of up to six months may be granted, for good cause shown, by theBuildingServices Director upon petition of the SUP holder.

(4) The use for which the Special Use Permit is authorized is discontinued for a period of six (6)consecutive months.

(5) In the event of discontinuance or failure to commence as stipulated in Subsection 24.93.12of this Ordinance, Zoning Enforcement Staff will issue written notification of same. Ten daysafter issuance of Zoning Enforcement notification of discontinuance or failure to commence,the Planning Director shall then issue the permit holder written notification of the Special UsePermit's official revocation and removal from the City of Laredo Zoning Map.

(b) Procedures:

(1) Should a City of Laredo Zoning Enforcement Official or Fire Official inspection revealnon-- compliance with Laredo Land Development Code, Section 24.93.7.(b) or any of anyadditional express conditions of the Special Use Permit, Special Use Permitsuspension/revocation procedures shall commence as below stipulated:

(a.) A Zoning Officer or Fire Official shall, upon discovery of special use permit non-compliance as per Subsection 24.93.7.(b), issue a written warning, granting a grace periodof a minimum of ten (10) working days, within which time the use may be brought intocompliance with the Current City Council approved Special Use Permit for that location.

(b.) If non-compliance persists after the conclusion of the warning grace period, a ZoningEnforcement Official or Fire Official shall issue written citation.

(c.) The requirement for the issuance of a written warning and grace period shall not applyto a citation issued as a result of a violation of the "Occupant Load" as set forth in theCertificate of Occupancy with Occupant Load or the failure to, during all hours ofoperation, maintain, free from obstruction or impediment to full instant use in the case offire or other emergency, all exit accesses, exits or exit discharges and said citation/s shallbe filed for prosecution.

(d.) Should a citation result in a court, having jurisdiction or a jury finding the holder ofthe Special Use Permit guilty of a violation, or if a holder of an SUP pleads guilty, theSpecial Use Permit will be suspended for such period of time as is necessary to remedythe violation, but in no event shall the suspension be for less than 24 hours to beimplemented as follows:.

i. The Zoning Officer or Fire Official shall immediately notify the PlanningDirector, in writing, of the result of the prosecution of the citation.

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ii. The Planning Director shall, within 48 hour notice of the court's determination (or as soon thereafter as is practicable) issue the permit holder written notification of the Special Use Permit's official suspension.

iii. The Special Use Permit Holder shall suspend all business operations in accordance with the notice.

iv. The Special Use Permit Holder shall not resume operation until the violation has been corrected and the establishment has been inspected. A "Notice of Termination of Suspension" shall be issued by the Planning Director upon his/her finding that all issues relevant to the suspension have been complied with and the 24 hour suspension period has run. The Planning Director shall issue such notice without unreasonable delay.

(2) Upon the second conviction of a violation of any of the provisions of the Laredo Land Development Code, Section 24.93.7. (b) or any additional express condition of the Special Use Permit, within any twelve month period, the Special Use Permit will be suspended for such period of time as is necessary to remedy the violation, but in no event shall the suspension be for less than 72 hours. This provision shall be implemented in the same manner as set forth above in Section24.93.12 (b) (l)(a-d).

(3) Upon the third conviction of a violation of any of the provisions of the Laredo Land Development Code, Section 24.93.7. (b) or any additional express condition of the Special Use Permit, within any twelve month period, and subject to the revocation/suspension procedures set forth in Section 24.93.12 (b) (l)(a-d), the Special Use Permit will be revoked and the City shall proceed with its removal from the City of Laredo Zoning Map.

(a.) The Planning Director shall issue the permit holder written notification of the Special Use Permit's official revocation and removal from the City of Laredo Zoning Map and the Special Use Permit Holder shall suspend all business operations which are inconsistent with and in violation of the zoning district in which the business is located.

(b.)Once the holder of the Special Use Permit has been notified of the revocation, the permit holder may petition the City Council for reinstatement of the permit. The reinstatement shall be processed and proceed in the same manner as a new application for a Special Use Permitinclusive of all required fees and documentation.

(c.) In the event the Special Use Permit Holder appeals the conviction, any suspension or revocation will be abated until the completion of the appeals process.

(4) For purposes of Section 24. }3.7.(1 ), (2), or (3) above, a finding of guilt on more than one citation issued on the same day for the Slime location shall be counted as only one violation.

(5) In the event the Special Use Permit Holder appeals a conviction, any suspension or revocation will be abated until the completion of the appeals process.

(6) Effect of Other Violations (Habitual Offenses):

5

(a.) Twelve violations of City Ordinances which result in an adjudication of guilt (by trial to the court, by jury or by entering a plea of guilt) during any twelve month period shall result in the revocation of the Special Use Permit. The holder of said SUP may avail himself/herself of the remedy set forth in Section 24.93.12(b)(3)(b).

(b.)Should the twelve citations, issued during any twelve month period result in a court having jurisdiction or a jury find the holder of the Special Use Permit guilty of each violation or if a holderof an SUP pleads guilty to violation/s, the City of Laredo shall consider the Special Use Permitrevoked and proceed with its removal from the City of Laredo Zoning Map.

(c.) The Planning Director shall then issue the permit holder written notification of the Special UsePermit's official revocation and removal from the City of Laredo Zoning Map and the Special UsePermit Holder shall suspend all business operations which are inconsistent with and in violation of thezoning district in which the business is located.

(d.)Once the holder of the Special Use Permit has been notified of the revocation, the permit holdermay petition the City Council for reinstatement of the permit. The reinstatement shall be processedand proceed in the same manner as a new application for a Special Use Permit inclusive of allrequired fees and documentation.

(e.) In the event the Special Use Permit Holder appeals any of the convictions the revocation will beabated until the completion of the appeals process.


_____________________________________ PETE SAENZMAYOR

ATTEST:




1

NE BOB BULLOCK LOOP 400'

INTER

NATIO

NAL B

LVD '

IN TERNATIONAL BLVD 102'

B-3

B-4

B-4R-1

AG

R-2

B-3

R-1

AG

B-3

2615L: 1

L: 1

2517L: 3B

L: UNPLATTED

2518L: 4

10802L: 5L: 1

10716L: 1B

10720L: 2

10713L: 6

10717L: 4

2603L: 3

10719L: 2

10715L: 5

2515L: 3A

10714L: 4B

10718L: 1A

1 inch = 150 feetDate: 12/2/2015


APPLICATION FORS.U.P. (SPECIAL USE PERMIT)

-> RESTAURANT10719 INTERNATIONAL BLVD


ZONING MAP

0 10050Feet

BACKWOODSTRL60'

WASHINGTONIADR60'

INTERNATIONA

L BLV

D90'

I NTE R

NATIO

NAL B

LVD 120

'


C E N TENARIO DR 50'IMPERIAL DR 50'

HAVANNA DR 60'

ANEJO

DR50'

SABAL LOOP 50'

HALLMARK DR 70'

NAFTA BLVD 70'

DELTA DR 70'

SIMON BOLIVAR BLVD 90'

PATRON

LOOP 50'

MONARCH DR 70'

TL AXCALADR50'MICHOACAN LOOP 50'

DOSREALES DR 50'

BUCKY HOUDMANNBLVD 80 '

EAST

POINT

DR 70

'

INTERNATIONALBLVD102'

1 inch = 600 feetDate: 12/2/2015




ZONING OVERVIEW

010020030040050060050Feet

2615L: 1

L:1

2517L: 3B

L:UNPLATTED

2518L: 4

10802L: 5

L:1

10716L: 1B

10720L: 2

10713L: 6

10717L: 4

2603L: 3

10719L: 2

10715L: 5

2515L: 3A

10714L: 4B

10718L: 1A

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INTER

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LVD '

IN TERNATIONAL BLVD 102' LightCommercial

Parks/Open Space

LightCommercial

HeavyCommercial

HeavyCommercial

Parks/OpenSpace

LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

MINO

R AR

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EXPRESSWAY

1 inch = 150 feetDate: 12/2/2015




FUTURE LANDUSE MAP

0 10050Feet

2615L: 1

L: 1

2517L: 3B

L:UNPLATTED

2518L: 4

10802L: 5

L:1

10716L: 1B

10720L: 2

10713L: 6

10717L: 4

2603L: 3

10719L: 2

10715L: 5

2515L: 3A

10714L: 4B

10718L: 1A

1


INTER

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LVD '


1 inch = 150 feetDate: 12/2/2015




AERIAL MAP

0 10050Feet

2615L: 1

L: 1

2517L: 3B

L:UNPLATTED

2518L: 4

10802L: 5

L:1

10716L: 1B

10720L: 2

10713L: 6

10717L: 4

2603L: 3

10719L: 2

10715L: 5

2515L: 3A

10714L: 4B

10718L: 1A

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INTER

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1 inch = 150 feetDate: 12/2/2015




200' NOTIFICATION

0 10050Feet


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Jose and Maria Alvarado, applicant; Alvarado Properties, Ltd., owner

Staff Source: Nathan Bratton, Planning Director

SUBJECT2016-O-013 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning four (4) acres out of Tracts 8-A, 8-B, 8-C and 8-D, Casa Verde Acres Subdivision, as further described by metes and bounds in attached Exhibit "A", located at 8404 Casa Verde Road, from R-1 (Single-family residential District) to R-2 (Multi-Family Residential District); providing for publication and effective date. District V


BACKGROUNDCouncil District: V – The Honorable Roque Vela, Jr.

Proposed use: Multi-family residential

Site: Vacant

Surrounding land uses: The properties to the north include single-family residentialuses and vacant land. To the south are vacant land, multi-family residential uses,commercial building and CPA Pay Plus Payroll. To the west is vacant land. To the eastare vacant land, single-family residences, manufactured homes and VMW MaintenanceSolutions.

Comprehensive Plan: The Future Land Use Map recognizes this area as Low DensityResidential.

Transportation Plan: The Long Range Thoroughfare Plan does not identify CasaVerde Road.


STAFF COMMENTS

Staff recommends approval of the proposed zone change for the following reasons:

The proposed zone change is appropriate at this location because it is compatiblewith the residential uses in the neighborhood.

1.

The property is large enough to support uses allowed in the proposed R-2 district.2.

IMPACT ANALYSIS

R-2 (Multi-Family Residential District): The purpose of the R-2 is to provide an areafor higher density residential uses and those public and semi-public uses normallyconsidered an integral part of the neighborhood they serve.

Is this change contrary to the established land use pattern? No, the established land use pattern is a mix of single-family residential, multi-familyresidential and commercial.

Would this change create an isolated zoning district unrelated to surroundingdistricts? No, there is an R-2 district to the west and northwest.

Will change adversely influence living conditions in the neighborhood? No, the proposed district is less intense than some of the existing uses.

Are there substantial reasons why the property can not be used in accordancewith existing zoning? Yes. The current R-1 district does not allow multi-family uses.


STAFF RECOMMENDATIONStaff supportsthe proposed zone change.


AttachmentsOrdinanceZoning Map

Aerial MapFuture Land Use MapZoning Overview MapPicturesSurvey and exhibits

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING FOUR (4) ACRES OUT OF TRACTS 8-A, 8-B, 8-C AND 8-D, CASA VERDE ACRES SUBDIVISION, AS FURTHER DESCRIBED BY METES AND BOUNDS IN ATTACHED EXHIBIT “A”, LOCATED AT 8404 CASA VERDE ROAD, FROM R-1 (SINGLE-FAMILY RESIDENTIAL DISTRICT) TO R-2 (MULTI-FAMILY RESIDENTIAL DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owners of Four (4) acres out of Tracts 8-A, 8-B, 8-C and 8-D, Casa Verde Acres Subdivision, as further described by metes and bounds in attached Exhibit “A”, located at 8404 Casa Verde Road, from R-1 (Single-family residential District) to R-2 (Multi-Family Residential District); and, WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on November 19, 2015, and, WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the proposed zone change; and, WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and, WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and, WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT: Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning Four (4) acres out of Tracts 8-A, 8-B, 8-C and 8-D, Casa Verde Acres Subdivision, as further described by metes and bounds in attached Exhibit “A”, located at 8404 Casa Verde Road, from R-1 (Single-family residential District) to R-2 (Multi-Family Residential District).

2

Section 2: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo. Section 3: This ordinance shall become effective as and from the date of publication specified in Section 2. PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE __________ DAY OF _________________, 2016. _____________________________________ PETE SAENZ MAYOR ATTEST: ___________________________ DOANH “ZONE” T. NGUYEN ACTING CITY SECRETARY APPROVED AS TO FORM: RAUL CASSO, CITY ATTORNEY ____________________________ KRISTINA K. LAUREL HALE ASSISTANT CITY ATTORNEY

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ROB BROGANCT 50'

CASA VERDE RD 60

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DON BETO DR 50'GRISELL DR 50'

POWERLINE DR 0'

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2320L: 2

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2314L: 5

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2311L: 10

2313L: 18

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2322L: 322309

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L: UNPLATTED


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1 inch = 150 feetDate: 11/12/2015


REZONE FROMR1 (SINGLE FAMILY RESIDENTIAL DISTRICT)

-> R2 (MULTI-FAMILY RESIDENTIAL DISTRICT)8404 CASA VERDE RD


ZONING MAP

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2320L: 312307

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2306L: 9 2318

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2303L: 14

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ROB BROGANCT 50'

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LEO REYES CT 50'DON BETO DR 50'GRISELL DR 50'

POWERLINE DR 0'

1 inch = 150 feetDate: 11/2/2015




AERIAL MAP

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HUTCH CT 50'

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POWERLINE DR 0'

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JACAMAN RD 91'

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ZONING OVERVIEW

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8404 Casa Verde RoadR-1 (Single Family Residential District) to R-2 (Multi-family Residential District)

ZC-01-2016


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Webb County, owner


SUBJECT2016-O-014 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning Lot 3, Block 1, Webb County Road and Bridge Plat Subdivision, located at 7210 U.S.Highway 59, from AG (Agricultural District) to B-1 (Limited Commercial District); providing for publication and effective date. District V

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Roque Vela, Jr. at the regular meeting ofJanuary 19, 2016.

BACKGROUNDBACKGROUND

Council District: V – The Honorable Roque Vela, Jr.

Proposed use: Fire Station

Site: Webb County Road and Bridge

Surrounding land uses: North of the site are vacant and park uses. To the West aresingle-family residential uses and Boy Scout Camp Huisache. To the East of theproperty is Life Downs. To the south are manufactured home residential uses, WebbCounty Records and Laredo Implement Company.

Comprehensive Plan: The Future Land Use Map recognizes this area as Institutional.

Transportation Plan: The Long Range Thoroughfare Plan identifies US Highway 59 asan Expressway.


STAFF COMMENTS

Staff supports the request for the following reasons:The proposed use is compatible with the existing zones and uses.1.

The property fronts on U.S. Highway 59 which is designated on the Long RangeThoroughfare Plan as an Expressway.

2.

The property is of a sufficient size to accommodate uses permitted in a B-1 district.3.

IMPACT ANALYSIS

B-1 (Limited Business District): The purpose of the B-1 District is to provide forbusiness and commercial development serving to a limited geographic area orneighborhood.

Is this change contrary to the established land use pattern? No, the established land use pattern along this section of US Highway 59 is Institutionaland commercial in nature.

Would this change create an isolated zoning district unrelated to surroundingdistricts? No, there are other commercial districts along this section of US Highway 59.

Will change adversely influence living conditions in the neighborhood?No, the proposed district is compatible with the existing surrounding uses.

Are there substantial reasons why the property cannot be used in accord withexisting zoning? Yes, the current district only allows for agricultural uses.


STAFF RECOMMENDATIONStaff supports the proposed zone change.


AttachmentsOrdinanceZoning Map

Aerial MapFuture Land Use MapZoning Overview MapPicturesSurvey

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING LOT 3, BLOCK 1, WEBB COUNTY ROAD AND BRIDGE PLAT SUBDIVISION, LOCATED AT 7210 U.S. HIGHWAY 59, FROM AG (AGRICULTURAL DISTRICT) TO B-1 (LIMITED COMMERCIAL DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owners of Lot 3, Block 1, Webb County Road and Bridge Plat Subdivision, located at 7210 U.S. Highway 59, from AG (Agricultural District) to B-1 (Limited Commercial District); and, WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on December 17, 2015, and, WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the proposed zone change; and, WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and, WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and, WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT: Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning Lot 3, Block 1, Webb County Road and Bridge Plat Subdivision, located at 7210 U.S. Highway 59, from AG (Agricultural District) to B-1 (Limited Commercial District). Section 2: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo.

2


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REZONE FROMAG (AGRICULTURAL DISTRICT)

-> B1 (LIMITED COMMERCIAL DISTRICT)7210 US HIGHWAY 59


ZONING MAP

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EXPRESSWAY

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FUTURE LANDUSE MAP

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CASA DEL SOL BLVD 60'

REMINGTON

DR60'

US HIGHWAY 59 150'

CEREUS CT 40'

MO NTEVISTADR50'ESCONDIDO

DR90'

WILSON RD 50'LOST HILLS TRL 50'

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1 inch = 800 feetDate: 12/3/2015




ZONING OVERVIEW

010020030040050060070080050Feet

7210 US Highway 59AG (Agricultural District) to B-1 (Limited Commercial District)

ZC-09-2016


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Jorge A. Vasquez, owner


SUBJECT2016-O-015 Amending the Zoning Ordinance (Map) of the City of Laredo by authorizinga Conditional Use Permit for an impound lot on Lots 3 and 4, Block 807, EasternDivision, located at 306 and 316 South Meadow Avenue; providing for publication andeffective date. District Ill

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Alejandro "Alex" Perez, Jr. at the regularmeeting of January 19, 2016.

BACKGROUNDCouncil District: III – The Honorable Alejandro “Alex” Perez

Proposed use: Impound Lot (Auto storage)

Site: Vehicle storage

Surrounding land uses: North of the site are single-family residences. East of the siteare single-family residences, vacant lots and a commercial building. To the south aresingle family residences, a body shop, a beauty salon, multi-family residential uses andIglesia Metodista. West of the site are single family dwellings, E & J Garage,manufactured homes and multi-family residences.

Comprehensive Plan: The Future Land Use Map recognizes this area as LightCommercial.

Transportation Plan: The Long Range Thoroughfare Plan identifies Meadow Avenueas a Major Collector.


STAFF COMMENTSThe Laredo Land Development Code (Section 24.63: Permitted Uses) permits AutoImpound yards in zones B-4, M-1, M-2 and MXD. This property is currently zoned B-1.Section 24.94.5(A)(3): Conditional Use Permit Application Submittal Criteria state that,

Section 24.94.5(A)(3): Conditional Use Permit Application Submittal Criteria state that,“Applications for properties currently zoned B-1, B-1R, CBD, B-3 or B-4, may only seekconditional use status for those uses permitted by zones B-1R, CBD, B-3, B-4 or M-1ofhigher intensity.”

Staff does not support the proposed Conditional Use Permit for the following reasons:The proposed use is not compatible with the adjacent established residentialneighborhood.

1.

The property fronts Meadow Avenue which is already a heavily congested road.2.The proposed C.U.P. will encroach into the established neighborhood andintroduce more intense and incompatible uses.

3.

Staff does not support the Conditional Use Permit at this location but recommends thefollowing provisions be attached if approved:

1. The C.U.P. shall be issued to Jorge A. Vasquez and is nontransferable.2. The C.U.P. is restricted to an auto impound lot with operating hours from 8:00 a.m.through 5:00 p.m. from Monday through Friday.3. The C.U.P. is restricted to the site plan, Exhibit “A”, which is made part hereof for allpurposes.4. Signage is limited to that allowed in a B-1 District.5. All areas used for storage of vehicles must be fully paved.6. No storage of inoperable or junk vehicles.7. Owner shall provide parking places in compliance with Section 24.78 of the LaredoLand Development Code. ADA-compliant parking space(s) shall be required.8. Off-site parking is prohibited.9. Owner shall provide and maintain trees and shrubs in compliance with Section 24.83of the Laredo Land Development Code.10. Owner shall provide an opaque fence wall of not less than seven feet in height alongproperty lines which abut or adjoin residential property or residential zoning district, incompliance with Section 24.79 of the Laredo Land Development Code.11. Lighting of property shall be screened to avoid adverse impact on adjacentresidential neighborhoods.12. Outdoor music and speakers shall be prohibited and there shall be no groundvibrations created or sustained on this site which are perceptible without instruments atany point on any property adjoining this property.13. No dismantling or chopping of vehicles on premises.14. The sale and consumption of alcohol on premises is prohibited. 16. Owner shall make provisions to keep litter to a minimum, and to keep it from blowingonto adjacent streets and properties.17. Owner shall comply with all Building, Fire and Life Safety Code Regulations asrequired.18. No mechanic, auto body or paint work is permitted on site.

COMMITTEE RECOMMENDATIONThe P & Z Commission, in a 7 to 0 vote, recommended approval of the Conditional Use

The P & Z Commission, in a 7 to 0 vote, recommended approval of the Conditional UsePermit.

STAFF RECOMMENDATIONStaff does not support the proposed Conditional Use Permit.


AttachmentsOrdinanceZoning MapAerial MapFuture Land Use MapZoning Overview MapPicturesExhibits and Survey

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY AUTHORIZING A CONDITIONAL USE PERMIT FOR AN IMPOUND LOT ON LOTS 3 AND 4, BLOCK 807, EASTERN DIVISION, LOCATED AT 306 AND 316 SOUTH MEADOW AVENUE; PROVIDING FOR EFFECTIVE DATE AND PUBLICATION.

WHEREAS, a request has been received for the issuance of a Conditional Use Permit for an impound lot on Lots 3 and 4, Block 807, Eastern Division, located at 306 and 316 South Meadow Avenue; and, WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on December 17, 2015; and, WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the Conditional Use Permit; and, WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and, WHEREAS, the City Council has held a public hearing on January 19, 2015, on the request and finds the Conditional Use Permit appropriate and consistent with the General Plan of the City of Lare-do; and, WHEREAS, all conditions imposed by the Conditional Use Permit, and all pertinent require-ments the Laredo Land Development Code shall be met before the activity sanctioned by the Condi-tional Use Permit may commence; and, WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance; and, NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT: Section 1: The Zoning Map of the City of Laredo be and is hereby amended by authorizing the issuance of a Conditional Use Permit for an impound lot on Lots 3 and 4, Block 807, Eastern Division, located at 306 and 316 South Meadow Avenue.

Section 2: The Conditional Use Permit is further restricted to the following provision herewith adopted by the City Council:

1. The C.U.P. shall be issued to Jorge A. Vasquez and is nontransferable. 2. The C.U.P. is restricted to an auto impound lot with operating hours from 8:00 a.m. through 5:00 p.m.

from Monday through Friday. 3. The C.U.P. is restricted to the site plan, Exhibit “A”, which is made part hereof for all purposes. 4. Signage is limited to that allowed in a B-1 District. 5. All areas used for storage of vehicles must be fully paved. 6. No storage of inoperable or junk vehicles. 7. Owner shall provide parking places in compliance with Section 24.78 of the Laredo Land Develop-

ment Code. ADA-compliant parking space(s) shall be required. 8. Off-site parking is prohibited. 9. Owner shall provide and maintain trees and shrubs in compliance with Section 24.83 of the Laredo

Land Development Code.

2

10. Owner shall provide an opaque fence wall of not less than seven feet in height along property lines which abut or adjoin residential property or residential zoning district, in compliance with Section 24.79 of the Laredo Land Development Code.

11. Lighting of property shall be screened to avoid adverse impact on adjacent residential neighborhoods. 12. Outdoor music and speakers shall be prohibited and there shall be no ground vibrations created or sus-

tained on this site which are perceptible without instruments at any point on any property adjoining this property.

13. No dismantling or chopping of vehicles on premises. 14. The sale and consumption of alcohol on premises is prohibited. 16. Owner shall make provisions to keep litter to a minimum, and to keep it from blowing onto adjacent

streets and properties. 17. Owner shall comply with all Building, Fire and Life Safety Code Regulations as required. 18. No mechanic, auto body or paint work is permitted on site.

Section 3: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo. Section 4: This ordinance shall become effective as and from the date of publication specified in Section 3. Section 5: The Conditional Use Permit authorized by this ordinance shall be revoked pursuant to the Laredo Land Development Code, section 24.94.10, entitled “Revocation,” according to the crite-ria and procedures described therein and below: 1. Criteria Any Conditional Use Permit, authorized by City Council, shall be considered in noncompliance and shall be revoked and removed from the City of Laredo Zoning Map, in the event a court of law finds the use in violation of any of the following conditions:

A. The use established on site does not conform, at any time, with any or all permit condi-tion(s) approved by the City Council and or any local, state, or federal law.

B. The activity authorized by the Conditional Use Permit commences prior to the institution of all conditions imposed by the Conditional Use Permit.

C. Discontinuance of the Council approved conditional use for a period of six (6) consecutive months.

D. The use of which the Conditional Use Permit was authorized does not commence within six months of City Council’s final approval date.

2. Procedures Should City of Laredo Enforcement Official inspection reveal noncompliance with Laredo Land De-velopment Code, Subsection 24.94.10, Conditional Use Permit revocation procedures shall commence as below stipulated:

A. A Zoning Officer shall, upon discovery of conditional use permit noncompliance as per Subsection 24.94.10, issue a written warning, granting a grace period of a minimum of ten (10) working days, within which time the use may be brought into compliance with the cur-rent City Council approved Conditional Use Permit for that location.

B. If noncompliance persists after the conclusion of the warning grace period, a Zoning En-forcement Official shall issue a written citation.

3

C. Should the citation result in a guilty verdict, the City of Laredo shall consider the Condi-tional Use Permit revoked and proceed with its removal from the City of Laredo Zoning Map.

D. The Planning Director shall then issue the permit holder written notification of the Condi-tional Use Permit’s official revocation and removal from the City of Laredo Zoning Map.

E. In the event of discontinuance or failure to commence as stipulated in Subsection 24.94.10.1 D and E of this Ordinance, Zoning Enforcement Staff will issue written notifica-tion of same. Ten days after issuance of Zoning Enforcement notification of discontinuance or failure to commence, the Planning Director shall then issue the permit holder written no-tification of the Conditional Use Permit’s official revocation and removal from the City of Laredo Zoning Map.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE __________ DAY OF _________________, 2016. _____________________________________ PETE SAENZ MAYOR ATTEST: ___________________________ DOANH “ZONE” T. NGUYEN ACTING CITY SECRETARY APPROVED AS TO FORM: RAUL CASSO, CITY ATTORNEY ___________________________ KRISTINA LAUREL HALE ASSISTANT CITY ATTORNEY

805

804

803

806

807

905

904

808903

MARION ST 55.56'

GATES ST 55.56'

S SEY

MOUR

AVE 5

5.56'

S MEA

DOW

AVE 5

5.56'

S MEN

DIOLA

AVE 5

5.56'

GATES ST 50'

B-1

B-1

B-1

R-3R-3

R-3

B-1

R-3

B-3

B-1

M-1

1407L: 4

1417L: 3

1417L: 2

1404L: 6

317L: 7

305L: 8

303L: 9

320L: 4 & 5

316L: 3

302L: 2

1401L: 10

219L: 6

302L: 1& 2

220L: 7

217L: 5

211L: 4A

209L: 3A

218L: 8

214L: 9

206L: 10

408L: 5

407L: 9

405L: 10

408L: 4

406L: 3

1419L: 1

1501L: 12

1506L: 7

315L: 8

313L: 9

311L: 10

303L: 11

1501L: 11

404L: 2

402L: 1

320L: 6

312L: 5

316L: 4

306L: 3

304L: 2

417L: 4

403L: 3

416L: 9

412L: 10

319L: 7A

317L: 8A

315L: 9

313L: 10

403L: 2

401L: 1

404L: 11

1619L: 12

320L: 6

1614L: 7B

318L: 4 & 5

310L: 3

1501L: 12

1504L: 5& 6

1517L: 1

220L: 7

217L: 4

215L: 3

216L: 8

202L: 9

202L: 10

303L: 11

301L: 12

1616L: 5 & 6

304L: 2

1617L: 12 & 1

1620L: 8 & 7

215L: 4 & 5

205L: 3

218L: 9

208L: 10

419L: 12

419L: 11

1701L: 1

1703L: 2

1702L: 12

1701L: 1& 2

1704L: 11

1702L: 7

215L: 8

213L: 9

211L: 10

L: 1

314L: 4

302L: 1

1611L: 12

1619L: 1

1514L: 5-6

1512L: 5-61402

L: 6

315L: 7

1618L: 8& 7

219L: 5& 6

318L: 4

403L: 3

2008-O-116

2003-O-106

1 inch = 100 feetDate: 12/3/2015


APPLICATION FORC.U.P. (CONDITIONAL USE PERMIT)

-> IMPOUND LOT306/ 316 S MEADOW AVE


ZONING MAP

0 10050Feet

1407L: 4

1417L: 3

1417L: 2

1404L: 6

317L: 7

305L: 8

303L: 9

320L: 4& 5

316L: 3

302L: 2

1401L: 10

219L: 6

302L: 1& 2

220L: 7

217L: 5

211L: 4A

209L: 3A

218L: 8

214L: 9

206L: 10

408L: 5

419L: 8& 7

407L: 9

405L: 10

416L: 5& 6

408L: 4

406L: 3

1419L: 1

1501L: 12

1506L: 7

315L: 8

313L: 9

311L: 10

303L: 11

1501L: 11

404L: 2

402L: 1

320L: 6

312L: 5

316L: 4

306L: 3

304L: 2

417L: 4

403L: 3

416L: 9

412L: 10

319L: 7A

317L: 8A

315L: 9

313L: 10

403L: 2

401L: 1

404L: 11

1619L: 12

320L: 6

1614L: 7B

318L: 4& 5

310L: 3

1501L: 12

1504L: 5 & 6

1517L: 1

220L: 7

217L: 4

215L: 3

216L: 8

202L: 9

202L: 10

303L: 11

301L: 12

1616L: 5 & 6

304L: 2

1617L: 12& 1

1620L: 8 & 7

215L: 4& 5

205L: 3

218L: 9

208L: 10

419L: 12

419L: 11

1701L: 1

1703L: 2

1702L: 12

1701L: 1 & 2

1704L: 11

1702L: 7

215L: 8

213L: 9

211L: 10

L:1

402L: 1

314L: 4

302L: 1

1611L: 12

1619L: 1

1514L: 5-6

1512L: 5-61402

L: 6

315L: 7

1618L: 8 & 7

219L: 5& 6

318L: 4

403L: 3805

804

803

806

807

905

904

808903

BOTAGEST24'

MARION ST 55.56'

GATES ST 55.56'

S SEY

MOUR

AVE 5

5.56'

S MEA

DOW

AVE 5

5.56'

S MEN

DIOLA

AVE 5

5.56'

GATES ST 50'

1 inch = 100 feetDate: 12/3/2015




AERIAL MAP

0 10050Feet

1407L: 4

1417L: 3

1417L: 2

1404L: 6

317L: 7

305L: 8

303L: 9

320L: 4& 5

316L: 3

302L: 2

1401L: 10

219L: 6

302L: 1& 2

220L: 7

217L: 5

211L: 4A

209L: 3A

218L: 8

214L: 9

206L: 10

408L: 5

419L: 8& 7

407L: 9

405L: 10

416L: 5& 6

408L: 4

406L: 3

1419L: 1

1501L: 12

1506L: 7

315L: 8

313L: 9

311L: 10

303L: 11

1501L: 11

404L: 2

402L: 1

320L: 6

312L: 5

316L: 4

306L: 3

304L: 2

417L: 4

403L: 3

416L: 9

412L: 10

319L: 7A

317L: 8A

315L: 9

313L: 10

403L: 2

401L: 1

404L: 11

1619L: 12

320L: 6

1614L: 7B

318L: 4& 5

310L: 3

1501L: 12

1504L: 5 & 6

1517L: 1

220L: 7

217L: 4

215L: 3

216L: 8

202L: 9

202L: 10

303L: 11

301L: 12

1616L: 5 & 6

304L: 2

1617L: 12& 1

1620L: 8 & 7

215L: 4& 5

205L: 3

218L: 9

208L: 10

419L: 12

419L: 11

1701L: 1

1703L: 2

1702L: 12

1701L: 1 & 2

1704L: 11

1702L: 7

215L: 8

213L: 9

211L: 10

L:1

402L: 1

314L: 4

302L: 1

1611L: 12

1619L: 1

1514L: 5-6

1512L: 5-61402

L: 6

315L: 7

1618L: 8 & 7

219L: 5& 6

318L: 4

403L: 3805

804

803

806

807

905

904

808903

BOTAGEST24'

MARION ST 55.56'

GATES ST 55.56'

S SEY

MOUR

AVE 5

5.56'

S MEA

DOW

AVE 5

5.56'

S MEN

DIOLA

AVE 5

5.56'

GATES ST 50'HighDensityResidential

HighDensity

Residential




LightCommercial

LightCommercial

LightCommercial

LightCommercial


LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

HighDensity

Residential

HighDensity

Residential

HighDensity

Residential



LightIndustrial

HighDensityResidential

MAJO

R CO

LLEC

TOR

1 inch = 100 feetDate: 12/3/2015




FUTURE LANDUSE MAP

0 10050Feet

N STO

NE AV

E 55.5

6'

NLO

RING

AVE

5 5.56

'

NSEY

M OUR

AVE

55 .56

'

BLAINE ST 55.56'

N MEA

DOW

AVE 5

5.56'

N URB

AHN A

VE 55

.56'

N MAL

INCH

E AVE

55.56

'

N BA

RTLE

TT AV

E 55.

56'

NJAR

VISAV

E55.

56'

S URB

AHN A

VE 55

.56'

BOTAGE ST 24'

CHACON ST 55.56'

PIEDRA CHINA ST 55.56'

S BAR

TLET

T AVE

55.56

'

MERCER ST 55.56'

GATES ST 50' S MEA

DOW

AVE 5

5.56'

GREEN ST 55.56'

S STO

NE AV

E 55.5

6'

S LOR

ING AV

E 55.5

6'GATES ST 55.56'

MILKST55.56'MILKST53'BURRST20'

FOSTERST30'

JAMESONST30'

FOSTERST14' S MEADOWAVE 50'

S BUE

NA VI

STA AV

E 55.5

6'1 inch = 500 feetDate: 12/3/2015




ZONING OVERVIEW

0 10020030040050050Feet

306 and 316 South Meadow AvenueB-1 (Limited Commercial Business) to Conditional Use Permit (Impound Lot)

ZC-10-2016


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Sanchez Family Investments, LTD, Owner; Juan G. Sanchez,

Owner/Applicant


SUBJECT2016-O-016 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoningLot 2B, Block 3, McPherson Acres, Unit 1, located at 5812 McPherson Road, from B-3(Community Business District) to B-4 (Highway Commercial District); providing forpublication and effective date. District V

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Roque Vela at the regular Council meetingof January 19, 2016.

BACKGROUNDCouncil District: V – The Honorable Roque Vela Proposed use: AmusementRedemption Machine Establishment (Maquinitas) Site: Magic car wash Surroundingland uses: North of the property are Rent a Wheel, Mar-La Restaurant, and McPhersonBusiness Square, Grainger Industrial Supply, Casa de Oracion, a Multi-FamilyApartment Complex, and a vacant lot. East of the property are Centre Plaza (acommercial plaza), Jett Bowl North, Virlar Automotive Group, and McPherson Plaza (acommercial Plaza). South of the property are Secure-it, Aloha Amusement, Fastenal, avacant lot, R.P.M., Tortillas Santos, R.F. Air Conditioning, a Mosque, A-1 Collision,Unique Creations Floral and Gifts, Park Place (a commercial plaza), etc. West of theproperty are Allied Primary Home Care, Terracon, Store-it-all, etc. Comprehensive Plan:The Future Land Use Map recognizes this area as Light Commercial. TransportationPlan: The Long Range Thoroughfare Plan identifies McPherson Road as a MajorArterial. The Plan does not identify Gale Street (north of the property). Letters sent tosurrounding property owners: 12 In Favor: 4 Opposed: 1

COMMITTEE RECOMMENDATIONThe P & Z Commission, in a 6 to 0 vote, recommended denial of the zone change.

STAFF RECOMMENDATIONStaff does not support the proposed zone change. STAFF COMMENTS The proposed

Staff does not support the proposed zone change. STAFF COMMENTS The proposedzone change is not appropriate at this location. The B-3 zoning is well established, andintroducing a B-4 district will negatively affect the area. Staff does not support theproposed zone change for the following reasons: 1. The proposed zone change mayintroduce more intense uses than those currently existing in the surrounding, wellestablished light commercial area. Uses allowable in a B-4 district are more intense andpossible less desirable and include such uses as bar, nightclub, cantina, saloon,amusement redemption machine establishment, amusement services (outdoor),petroleum sales (wholesale), alcoholic beverage storage and distribution, scrap/wasterecycle collection, automobile sales-wholesale, auto body repair, recreational vehicleparking lot, auto paint shop, auto muffler shop, major appliances sales (outdoor), mobilehome dealer/sales only, truck/heavy equipment driving school, etc. 2. The proposedzone change is not appropriate at this location, because it is not compatible with theComprehensive Plan’s designation as Light Commercial. 3. The proposed district is notcompatible with the existing zoning along the north section of McPherson Road. This isa stable, homogenous light commercial district with no trending toward more intenseuses. IMPACT ANALYSIS B-4 (Highway Commercial District): The purpose of the B-4District (Highway Commercial District) is to provide for those businesses and servicesserving a regional area which are to be located primarily along principal (major) arterialstreets or the freeway, as classified in the Transportation Plan of the City of Laredo. It isintended for this zoning classification to exist primarily along principal arterial streets orthe freeway and to impose site development regulations to ensure adequate access ofall uses within this classification. Is this change contrary to the established land usepattern? Yes. The proposed property is located west of McPherson Road and south ofGale Street which is entirely a light commercial. North of Gale street there are lightcommercial and multifamily uses. Would this change create an isolated zoning districtunrelated to surrounding districts? No, there are existing B-4 districts north, and south ofthe property along McPherson Road, however the predominant uses around theproperty are light commercial uses and some of them abut a residential district. Willchange adversely influence living conditions in the neighborhood? Yes, the area isalready a commercial corridor with heavy traffic that could increase noise and traffic inthe neighborhood. Are there substantial reasons why the property cannot be used inaccordance with existing zoning? No. The existing B-3 (Community Business District)allows for commercial uses.


Attachments2016-O-16Zoning MapZoning Overview MapFuture Land Use MapAerial MapMeasurements MapSurvey Map200' Notification MapColor Pictures

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING LOT 2B, BLOCK 3, MCPHERSON ACRESUNIT 1, LOCATED AT 5812 MCPHERSON ROAD, FROM B-3(COMMUNITY BUSINESS DISTRICT) TO B-4 (HIGHWAY COMMERCIAL DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owner of Lot 2B, Block 3, McPherson Acres, Unit 1, located at 5812 McPherson Road, from B-3 (Community Business District) to B-4 (Highway Commercial District); and,

WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on November 19, 2015; and,

WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended denial of the proposed zone change; and,

WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and,

WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and,



Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning, Lot 2B, Block 3, McPherson Acres, Unit 1, located at 5812 McPherson Road, from B-3 (Community Business District) to B-4 (Highway Commercial District).


2



_____________________________________ PETE SAENZMAYOR

ATTEST:




7

3

3

GALE ST 60'

AMISTAD DR 50'

MCPHERSON RD 120'

B-3

B-3

B-3

B-4

B-4

M-1

B-3

5817L: 3

5901L: 1

608L: 5

610L: 4

610L: 3

5902L: 1

5904L: 2

5918L: 3

607L: 6 609

L: 5

606L: 12

608L: 13 610

L: 14 612L: 15 614

L: 16

611L: 4-A

604L: 7 606

L: 6

615L: 3

701L: 45810

L: 1A

5812L: 2B

2008-O-035

2008-O-035

1 inch = 100 feetDate: 11/2/2015


REZONE FROM B3 (COMMUNITY BUSINESS DISTRICT)

-> B4 (HIGHWAY COMMERCIAL DISTRICT)5812 MCP[HERSON RD


ZONING MAP

0 10050Feet

COLORADO ST 50'

GALE ST 60'WILDWOODLN50'

VIOLETA CT 50'OH

IO CIR 50'

CACT

USDR 50

'

LOS EBANOS DR 50'IDAHO ST 50'

HIDDEN LN 50'

HAWA

II LN 5

0'

KENTUCKY ST 50 '

E MAYBERRY ST 50'

CALLE DEL NORTE 64'

CALLE DEL NORTE 60'

TRADE WIND 50'

ILLINOIS ST 50'PO

ST OA

K DR 5

0'

GALE CT 50'

AGAVE DR 50'

DEL NORTE LOOP 50'

CYPR

ESS DR

50'

WYOMING 50'

MCPHERSON RD 115'

NORTH POINT DR 50'

AMISTAD DR 50'

EAST

DR 60

'

CERRIT

OPR

IETO

CT60

'

MULLER RD 50'

ST JAMES DR 60'

CIMARRON DR 50'

S UNRI DGE L

OOP 5

0'

N BAR

TLETT AVE 80'

WEST

DR 60

'

LONGORIALOOP50'

1 inch = 500 feetDate: 11/2/2015




ZONING OVERVIEW

0 10020030040050050Feet

5817L: 3

5901L: 1

608L: 5

610L: 4

610L: 3

5902L: 1

5904L: 2

1603L: 4

5918L: 3

607L: 6 609

L: 5 611L: 4

606L: 12

608L: 13

613L: 3

610L: 14

612L: 15

614L: 16

607L: 6-A

611L: 4-A

604L: 7

606L: 6

615L: 3

701L: 4

5810L: 1A

5812L: 2B

7

3

3

GALE ST 60'

AMISTAD DR 50'

MCPHERSON RD 120'

LightIndustrial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

HeavyCommercial

LightCommercial

HeavyCommercial

HeavyCommercial

HeavyCommercial

HeavyCommercial Heavy

Commercial

LightCommercial

LightCommercial

LightCommercial

LightCommercial

LightIndustrialLight

Commercial

MAJOR ARTERIAL

1 inch = 100 feetDate: 11/2/2015




FUTURE LANDUSE MAP

0 10050Feet

5817L: 3

5901L: 1

608L: 5

610L: 4

610L: 3

5902L: 1

5904L: 2

1603L: 4

5918L: 3

607L: 6 609

L: 5 611L: 4

606L: 12

608L: 13

613L: 3

610L: 14

612L: 15 614

L: 16

607L: 6-A

611L: 4-A

604L: 7

606L: 6

615L: 3

701L: 4

5810L: 1A

5812L: 2B

7

3

3

GALE ST 60'

AMISTAD DR 50'

MCPHERSON RD 120'

1 inch = 100 feetDate: 11/2/2015




AERIAL MAP

0 10050Feet

L:

L:L:

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L:

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7

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2A2A

3

3

MCPHERSON RD 120'GALE ST 60'

AMISTAD DR 50'

B-3

B-3

R-1

B-4

B-4

B-3

B-3

M-1

M-1

B-3

25.89

51.01

68.9

73.66

90.02

99.6

127.24413.32

1 inch = 150 feetDate: 11/18/2015




MEASUREMENTS

DISTANCE TO:NEAREST CHURCH (PROPERTY TO PROPERTY) : 127.24 FTNEAREST CHURCH (RESTAURANT DOOR TO CHURCH DOOR) : 602.89 FTNEAREST CHURCH (MAQUINITAS DOOR TO CHURCH DOOR) : 632.83 FT

0 10050Feet

5817L: 3

5901L: 1

608L: 5

610L: 4

610L: 3

5902L: 1

5904L: 2

1603L: 4

5918L: 3

607L: 6 609

L: 5 611L: 4

606L: 12

608L: 13

613L: 3

610L: 14

612L: 15 614

L: 16

607L: 6-A

611L: 4-A

604L: 7

606L: 6

615L: 3

701L: 4

5810L: 1A

5812L: 2B

7

3

3

GALE ST 60'

AMISTAD DR 50'

MCPHERSON RD 120'

1 inch = 100 feetDate: 11/2/2015




200' NOTIFICATION

0 10050Feet


Initiated By: Horacio De Leon, Assistant City Manager Initiated By: Daniel Lopez, applicant; Lincoln HRP, Inc., owner


SUBJECT2016-O-017 Amending the Zoning Ordinance (Map) of the City of Laredo by rezoning Lot 10, Block 86, Western Division, located at 320 lturbide Street from B-1 (Limited Commercial District) to B-3 (Community Business District); providing for publication and effective date. District VIII

PREVIOUS COUNCIL ACTIONThis item was introduced by the Honorable Roberto Balli at the regular meeting ofJanuary 20, 2016.

BACKGROUNDCouncil District: VIII – The Honorable Roberto Balli

Proposed use: pool hall/restaurant

Site: Vacant commercial structure

Surrounding land uses: North of the property are single-family residential uses,multi-family residences and vacant commercial structures. South of the property aremulti-family residences, Freddy’s Auto Repair, vacant lots, City Plumbing, La AztecaRopa Usada and single-family residential uses. East of the site are single-familyresidential uses, multi-family residences and vacant commercial structures. West of thesite and single-family residential uses, Iglesia Cristiana and multi-family residences.

Comprehensive Plan: The Comprehensive Plan identifies this area as LightCommercial.

Transportation Plan: The Long Range Thoroughfare Plan does not identify IturbideStreet.

Letters sent to surrounding property owners: 44 In Favor: 2 Opposed: 1 STAFF COMMENTS

Staff does not support the proposed zone change for the following reasons:The property is too small to provide for parking requirements of the proposed use1.

and other B-3 uses.The neighborhood primarily follows a mixed residential pattern of development.2.The proposed B-3 district may introduce more intense and incompatible uses intothe well-established residential neighborhood.

3.

IMPACT ANALYSIS

B-3 (Community Business District): The purpose of the B-3 District is to provide forthose businesses and services serving a trade area larger than a neighborhood, butsmaller than the entire city and located primarily along minor or principal arterial streets,as classified in the Transportation Plan of the City of Laredo. It is intended for thiszoning classification to exist primarily abutting minor or principal arterial streets whilepreserving established residential neighborhoods along such streets.

Is this change contrary to the established land use pattern? Yes, the established land use pattern is primarily residential in nature.

Would this change create an isolated zoning district unrelated to surroundingdistricts? No, there are B-3 districts on the south side of Iturbide Street.

Will change adversely influence living conditions in the neighborhood?The proposed B-3 district may introduce more intense uses to the area.

Are there substantial reasons why the property cannot be used in accord withexisting zoning? No, the existing B-1 district allows for sufficient commercial uses.


STAFF RECOMMENDATIONStaff does not support the proposed zone change.


Attachments

AttachmentsOrdinanceZoning MapAerial MapFuture Land Use MapZoning Overview MapPicturesSurvey

1


AMENDING THE ZONING ORDINANCE (MAP) OF THE CITY OF LAREDO BY REZONING LOT 10, BLOCK 86, WESTERN DIVISION, LOCATED AT 320 ITURBIDE STREET FROM B-1 (LIMITED COMMERCIAL DISTRICT) TO B-3 (COMMUNITY BUSINESS DISTRICT); PROVIDING FOR PUBLICATION AND EFFECTIVE DATE.

WHEREAS, a zone change has been requested by the owners of Lot 10, Block 86, Western Division, located at 320 Iturbide Street from B-1 (Limited Commercial District) to B-3 (Community Business District); and, WHEREAS, the required written notices were sent to surrounding property owners at least ten (10) days before the public hearing held before the Planning and Zoning Commission on December 17, 2015, and, WHEREAS, the Planning and Zoning Commission, after a public hearing, has recommended approval of the proposed zone change; and, WHEREAS, notice of the zone change request was advertised in the newspaper at least fifteen (15) days prior to the public hearing held before the City of Laredo City Council on this matter; and, WHEREAS, the City Council has held a public hearing on January 19, 2016, on the request and finds the zone change appropriate and consistent with the General Plan of the City of Laredo; and, WHEREAS, the City Council does not consider the impact, if any, of private covenants and deed restrictions on the subject property with the adoption of this ordinance. NOW, THEREFORE BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT: Section 1: The Zoning Map of the City of Laredo be and is hereby amended by rezoning Lot 10, Block 86, Western Division, located at 320 Iturbide Street from B-1 (Limited Commercial District) to B-3 (Community Business District). Section 2: This ordinance shall be published in a manner provided by Section 2.09 (D) of the Charter of the City of Laredo.

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L: 4

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1 inch = 75 feetDate: 12/10/2015



-> B3 (COMMUNITY BUSINESS DISTRICT)320 ITURBIDE ST


ZONING MAP

500L: 5

420L: 1

418L: 1

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414L: 2

412L: 3

410L: 3

406L: 4

504L: 6

505L: 5

420L: 10

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408L: 7

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405L: 4

416L: 2

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406L: 4

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320L: 1

311L: 1

318L: 2

317L: 10

315L: 9

314L: 2

314L: 3

310L: 3

306L: 4

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L: 10213L: 9

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304L: 6

301L: 5

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L: 1216L: 2

212L: 8

211L: 3

504L: 5

419L: 10

415L: 9

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409L: 7

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1 inch = 75 feetDate: 12/10/2015




AERIAL MAP

500L: 5

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307L: 7

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303L: 4

318L: 2

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L: 10213L: 9

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304L: 6

301L: 5

409L: 10

216L: 9

219L: 1

215L: 2

302L: 5

220L: 1

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211L: 3

504L: 5

419L: 10

415L: 9

413L: 8

409L: 7

401L: 6

218L: 2

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316L: 2

314L: 3

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1 inch = 75 feetDate: 12/10/2015




FUTURE LANDUSE MAP

E CORPUS CHRISTIST 55.56'

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ITURBIDE ST 30'

HIDALGO ST 30'

FARRAGUT ST 30'

LINCOLN ST 30'

ZARAGOZA ST 30'

MATAMOROSST44'

ITURBIDEST50'

VICTORIA ST 58'

MATAMOROSST43.6'

WATERST 30'

MARC

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AVE 5

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WATERST55.56'

GRANTST24'

LINCOLNST24'

VICTORIA ST 61'FLO R

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HOUSTONST70'

MARKETST30'

CHIHUAHUA 387'GUADALUPE 387'

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1 inch = 500 feetDate: 12/10/2015




ZONING OVERVIEW

0 10020030040050050Feet

310 Iturbide StreetB-1 (Limited Commercial District) to B-3 (Community Business District)

ZC-08-2016


Initiated By: Jesus Olivares, City Manager Staff Source: Jose Luis Flores

SUBJECT2016-O-018 Authorizing the City Manager to execute a lease assignment from AdrianaMartinez, as LESSEE, to Mel-Mac Deck Investments, LLC., as ASSIGNEE, of thatoriginal lease agreement approved by Ordinance No. 95-O-177 dated August 7, 1995and as amended by Ordinance No. 2015-O-020 for approximately 16,291.44 square feetof land located at 1719 E. Hillside St., located at the Laredo International Airport. Themonthly rental effective September 1, 2015 is increased from $1,410.46 to $1,660.46and shall be adjusted by changes in CPI. All other terms and conditions remain thesame and in effect; providing for an effective date.

PREVIOUS COUNCIL ACTIONCity Council approved Ordinance No. 2015-O-020 on February 17, 2015 leaseassignment from Miguel A. Rojas to Adriana Martinez.

BACKGROUNDSection 7.04 Assignment:LESSEE shall have the right and privilege to assign this lease solely for the purpose ofsecuring a mortgage as permitted in ARTICLE VI “Encumbrances” of this leaseagreement and subject to prior written approval of LESSOR, which approval LESSORshall not unreasonably withhold.

The previous rent of $1,410.46 was adjusted by fair market rent appraisal in the monthlyamount of $ 1,630.00 and adjusted by an additional $30.46 per month for the privilege ofassigning the lease to Mel-Mac Deck Investments.

New monthly rent is $1,660.46

COMMITTEE RECOMMENDATIONOn December 01, 2015 the Airport Advisory Board considered this item andrecommends approval

STAFF RECOMMENDATIONApproval of Ordinance.

Fiscal Impact

Fiscal Year: 2016Bugeted Y/N?:Source of Funds:Account #: 242-0000-361.20.60Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Airport Land Rent Account No. 242-0000-361.20-60Current monthly rent obligation is $1,660.46

AttachmentsMel-Mac Deck ORDMel-Mac Deck DOC

of 2


AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE ASSIGNMENT FROM ADRIANA MARTINEZ, AS LESSEE, TO MEL- MAC DECK INVESTMENTS, LLC., AS ASSIGNEE, OF THAT ORIGINAL LEASE AGREEMENT APPROVED BY ORDINANCE NO. 95-O-177 DATED AUGUST 7, 1995, AND AS AMENDED BY ORDINANCE NO. 2015-O- 020 FOR APPROXIMATELY 16,291.44 SQUARE FEET OF LAND LOCATED AT 1719 E. HILLSIDE ST., LOCATED AT THE LAREDO INTERNATIONAL AIRPORT. THE MONTHLY RENTAL EFFECTIVE SEPTEMBER 01, 2015 IS INCREASED FROM $1,410.46 TO $1,660.46 AND SHALL BE ADJUSTED BY CHANGES IN CPI. ALL OTHER TERMS AND CONDITIONS REMAIN THE SAME AND IN EFFECT; PROVIDING FOR EFFECTIVE DATE.

WHEREAS, the Airport Manager recommends that the City Council approve Lessor’s consent to an assignment of the Lease Agreement approved by Ordinance No. 2015-O-020 dated February 17, 2015 between the City of Laredo and Adriana Martinezfor approximately 16,291.44 square feet of land located on 1719 E. Hillside St., Lot No. 2 of Block No. 15 of the Subdivision Plat of the Laredo International Airport, and approving said lease is assigned to Mel- Mac Deck Investments, LLC. All terms and conditions remain the same and in effect, and in furtherance of the development of the Laredo International Airport;

WHEREAS, the Airport Advisory Board finds that said assignment is in the best interest of the Airport and recommends that the City Council approve the proposed assignment; and

WHEREAS, the City Council of the City of Laredo having heard the recommendations of the Airport Manager and of the Airport Advisory Board agrees with same.


Section 1: The City Manager be hereby authorized to execute Lessor’s Consent to an assignment of that Lease Agreement approved by Ordinance No. 2015-O-020 dated February 17, 2015 between the City of Laredo and Adriana Martinez for approximately 16,291.44 square feet of land located on 1719 E. Hillside St, Lot No. 2 of Block No. 15 of the Subdivision Plat of the Laredo International Airport, and approving said lease is assigned to Mel-Mac Deck Investments, LLC. All terms and conditions remain the same and in effect, and a copy of which assignment is attached hereto as Exhibit A, and incorporated herein as if set out at length for all intents and purposes.

LEASE ASSIGNMENT TO MEL-MAC DECK INVESTMENTS (GYM)

Page 2 of 2


PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE ____ DAY OF ________________, 2016.

_________________________PETE SAENZMAYOR

ATTEST:

_____________________________DOANH “ZONE” T. NGUYENACTING CITY SECRETARY


BY:__________________________RAUL CASSOCITY ATTORNEY



SUBJECT2016-O-019 Authorizing the ratification of the contract amendment with the TexasHealth and Human Services Commission (HHSC) and amending the FY 2015-2016budget by appropriating additional revenues and expenditures in the amount of$106,158.60 with a cash match of $10,616.00 for a total of $573.274.60 for continuationof the Nurse Family Partnership (NFP) for the City of Laredo Health Department (CLHD)to provide evidence-based nurse home visitation for first-time mothers and developmentand preventive care to their children to ensure a healthy birth outcome for mom andbaby for the period beginning September 1, 2015 through August 31, 2016.


PREVIOUS COUNCIL ACTIONOn January 19, 2016, Council introduced the Ordinance.

BACKGROUNDThe Texas Health and Human Services Commission (HHS) has contracted with the Cityof Laredo Health Department (CLHD) for a Nurse-Family Partnership (NFP) to providehome visitation services for first-time mothers to enhance early and timely access tocare, improve women’s health outcome and improve children’s growth, developmentand wellness as well as assure prevention of potential risks in women and child neglectand abuse. The intervention will assist women and children to have a healthier birthoutcome, ensure developmental, prevention and social services support for mother andchild during the first two years of life. .

Laredo has the third largest birth rate in the state of Texas and over 45%un/underinsured and/or medically indigent. It is also a health professions shortage area.Teen pregnancy is a critical unmet need with 334 recorded teen pregnancies in 2009.Late prenatal care is also a problem with over 60% of maternity patients seen in thesecond or early third trimester, increasing the risk of infant mortality and reducing thepositive birth outcomes for the mother and newborn child.

A project such as the NFP integrated into the CLHD maternity and prevention routineservices will greatly improve outcomes, assure the continuum of care and link first timemothers, their children and their families to all social services needed to improve the

quality of life.


STAFF RECOMMENDATIONStaff recommends that Council approve the Ordinance.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The revenue account 226-0000-321-6301 will increase by $106,158.60 and therevenue account for the in-kind match 226-0000-372-1100 will increase by a total of$10,616.00. The expenditure division 226-6104 with the project number HENF05 willincrease by $116,774.60.

Attachments2016-O-19BudgetContract

ORDINANCE 2016-O-19

AUTHORIZING THE RATIFICATION OF THE CONTRACT AMENDMENT WITH THE TEXAS HEALTH AND HUMAN SERVICES COMMISSION (HHSC) AND AMENDING THE FY 2015-2016 BUDGET BY APPROPRIATING ADDITIONAL REVENUES AND EXPENDITURES IN THE AMOUNT OF $106,158.60 WITH A CASH MATCH OF $10,616.00 FOR A TOTAL OF $573.274.60 FOR CONTINUATION OF THE NURSE FAMILY PARTNERSHIP (NFP) FOR THE CITY OF LAREDOHEALTH DEPARTMENT (CLHD) TO PROVIDE EVIDENCE-BASED NURSE HOME VISITATION FOR FIRST-TIME MOTHERS AND DEVELOPMENT AND PREVENTIVE CARE TO THEIR CHILDREN TO ENSURE A HEALTHY BIRTH OUTCOME FOR MOM AND BABY FOR THE PERIOD BEGINNING SEPTEMBER 1, 2015 THROUGH AUGUST 31, 2016.

WHEREAS, the Texas Health and Human Services Commission (HHS) has contracted with the City of Laredo Health Department (CLHD) for a Nurse-Family Partnership (NFP) to provide home visitation services for first-time mothers to enhance early and timely access to care, improve women’s health outcome and improve children’s growth, development and wellness as well as assure prevention of potential risks in women and child neglect and abuse; and

WHEREAS, Laredo has the third largest birth rate in the state of Texas and over 45% un/underinsured and/or medically indigent. It is also a health professions shortage area. Teen pregnancy is a critical unmet need with 334 recorded teen pregnancies in 2009. Late prenatal care is also a problem with over 60% of maternity patients seen in the second or early third trimester, increasing the risk of infant mortality and reducing the positive birth outcomes for the mother and newborn child; and

WHEREAS, a project such as the NFP integrated into the CLHD maternity and prevention routine services will greatly improve outcomes, assure the continuum of care and link first time mothers, their children and their families to all social services needed to improve the quality of life.

NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT:

Section 1: The City Manager is hereby authorized to ratify the contract amendment with the Texas Health and Human Services Commission (HHS) and amending the FY 2015-2016 budget by appropriating additional revenues

2

and expenditures in the amount of $106,158.60 with a cash match of $10,616.00 for a total of $573,274.60 for continuation of the Nurse Family Partnership (NFP) for the City of Laredo Health Department (CLHD) to provide evidence-based nurse home visitation for first-time mothers and their children to ensure a healthy birth outcome for mom and baby for the period beginning September 1, 2015 through August 31, 2016.

Section 2: The revenue account 226-0000-321-6301 is hereby increased by $106,158.60 and the revenue account for the in-kind match 226-0000-372-1100 is hereby increased by a total of $10,616.00. The expenditure division 226-6104 with the project number HENF05 is hereby increasedby $116,774.60.

Section 3: The City Manager is hereby authorized to make transfers within the budget as allowable under the Special Contract Provisions and General Provisions of the contract with HHSC to meet the necessary costs to accomplish the scope of work for the program.


THIS _________________ DAY OF ________________________, 2016.

______________________________PETE SAENZMAYOR

ATTEST:





Nurse Family PartnershipAccount Number 226-6104; Project Number HENF05

BUDGET

CATEGORIES

REVENUES Original Amended New Total

REVENUES $ 415,000 106,158.60 521,158.60

CASH MATCH 41,500 10,616.00 52,116.00

TOTAL $ 456,500 116,774.60 573,274.60

EXPENSES

PERSONNEL $ 199,150 100,172.00 299,322.00

FRINGE BENEFITS 92,949 49,642.00 142,591.00

TRAVEL 23,206 6,382.00 29,588.00

EQUIPMENT 0 0.00 0.00

SUPPLIES 1,200 6,945.60 8,145.60

CONTRACTUAL 0 0.00 0.00

OTHER 98,495 -56,983.00 41,512.00

CASH MATCH $ 41,500 10,616.00 52,116.00

TOTAL $ 456,500 116,774.60 573,274.60

HHSC Contract No. __________________

- i -

State of Texas

County of Travis

INTERLOCAL AGREEMENT BETWEEN THE

HEALTH AND HUMAN SERVICES COMMISSION AND

CITY OF LAREDO FOR THE

NURSE-FAMILY PARTNERSHIP PROGRAM

ARTICLE I. INTRODUCTION ................................................................................................................ 1

ARTICLE II. BACKGROUND, INDUCEMENTS, AND OBJECTIVES ............................................ 1

SECTION 2.01 BACKGROUND. .............................................................................................................. 1 SECTION 2.02 SUMMARY OF PROCUREMENT ACTIVITIES. ................................................................... 1 SECTION 2.03 CONTRACTOR’S EXPERIENCE AND QUALIFICATIONS. .............................................. 2 SECTION 2.04 MISSION OBJECTIVES. ................................................................................................... 2 SECTION 2.05 CONTRACTOR’S INDUCEMENTS. ............................................................................... 2 SECTION 2.06 AGREEMENT ELEMENTS. ............................................................................................... 3 SECTION 2.07 TERM OF THE AGREEMENT ........................................................................................... 3 SECTION 2.08 KEY STAFF .................................................................................................................... 3 SECTION 2.09 NOTICES ........................................................................................................................ 4 SECTION 2.10 LAWS AND REGULATIONS GOVERNING THE PROCUREMENT OF THE SERVICES ........... 5 SECTION 2.11 LAWS AND REGULATIONS GOVERNING THE ADMINISTRATION OF THE AGREEMENT .. 5 SECTION 2.12 LAWS AND REGULATIONS PERTAINING TO THIS AGREEMENT ...................................... 5 SECTION 2.13 LAWS AND REGULATIONS GOVERNING CIVIL RIGHTS ................................................. 6 SECTION 2.14 CONFLICTS OF INTEREST ............................................................................................... 7 SECTION 2.15 SPECIAL TERMS AND CONDITIONS-HIPPA-PROTECTED HEALTH INFORMATION ........ 7 SECTION 2.16 PROHIBITION AGAINST PERFORMANCE OUTSIDE THE UNITED STATES ....................... 7

ARTICLE III. SCOPE OF WORK – SERVICES AND DELIVERABLES ....................................... 10

SECTION 3.01 SCOPE OF THE SERVICES AND DELIVERABLES ............................................................ 10 SECTION 3.02 PERFORMANCE MEASUREMENT AND MONITORING ................................................... 10 SECTION 3.03 ADDITIONAL STATE OF TEXAS OR TEXAS GOVERNMENT CUSTOMERS ..................... 10

ARTICLE IV. TERMS AND CONDITIONS OF PAYMENT ............................................................. 11

SECTION 4.01 TOTAL COST ................................................................................................................ 11 SECTION 4.02 GENERAL PAYMENT TERMS ........................................................................................ 11 SECTION 4.03 ADDITIONAL PAYMENT TERMS ................................................................................... 12 SECTION 4.04 REQUIRED INVOICES FOR PAYMENT ........................................................................... 12 SECTION 4.05 TIME AND MANNER OF PAYMENT ............................................................................... 12 SECTION 4.06 FAILURE, TERMINATION OR SUSPENSION OF HHSC FUNDING ................................... 12 SECTION 4.07 STATE AUDITOR’S OFFICE .......................................................................................... 13

ARTICLE V. PERFORMANCE & TAILORED REMEDIES MATRIX ........................................... 13

SECTION 5.01 PERFORMANCE REMEDIES – DAMAGES ...................................................................... 13

ARTICLE VI. BUSINESS PLAN FOR NEGOTIATING CONTRACT AMENDMENTS .............. 13

HHSC Contract No. __________________

- ii -

SECTION 6.01 AMENDMENTS ............................................................................................................. 13 SECTION 6.02 REQUIRED COMPLIANCE WITH MODIFICATION PROCEDURES...................................... 13

ARTICLE VII. AUTHORITY TO EXECUTE ...................................................................................... 14

Exhibit A: Request for Proposals (RFP) No. 529-16-0003 for Texas Home Visiting Program

Exhibit B: CONTRACTOR’s proposed Scope of Work

Exhibit C: Uniform Contract Terms and Conditions, Version 1.5 including its Attachment A “Data Use

Agreement, Ver. 8.3”

Exhibit D: Uniform Grant Management Standards Governor’s Office of Budget and Planning (As

Adopted June 2004)

Exhibit E: Additional Contract Requirements

Exhibit F: Reporting Requirements

Exhibit G: Performance Measures

Exhibit H: Contract Budget

1

STATE OF TEXAS

COUNTY OF TRAVIS

INTERLOCAL AGREEMENT

BETWEEN THE

HEALTH AND HUMAN SERVICES COMMISSION

AND

CITY OF LAREDO

FOR THE


Article I. INTRODUCTION

This Agreement is between the Health and Human Services Commission (HHSC), an administrative

agency within the executive department of the State of Texas, having its principal office at 4900 North

Lamar Boulevard, Austin, Texas, 78751, and City of Laredo (CONTRACTOR), having its principal

office at 1110 Houston Street, Laredo, Texas 78040. HHSC and CONTRACTOR may be referred to in

this Agreement individually as “Party” and collectively as the “Parties.”

The Parties agree that the following terms and conditions shall apply to the services and deliverables

to be provided by the CONTRACTOR under this Agreement in consideration of certain payments to be

made by HHSC.

Article II. BACKGROUND, INDUCEMENTS, AND OBJECTIVES

Section 2.01 Background.

The Nurse-Family Partnership Program (NFP) that is the subject of this Agreement is a project under

the supervision of the Texas Home Visiting Program; this Agreement requires specified approvals from

and adherence to standards promulgated by the Texas Home Visiting Program. The Nurse-Family

Partnership Program is funded by the State of Texas in response to Senate Bill 156, 80th Legislature,

Regular Session. The purpose of the funding is to support the statewide implementation or expansion of

NFP Programs.

Section 2.02 Summary of Procurement Activities.

It is the intent of HHSC to support the Nurse-Family Partnership Program in Webb County, Texas

through this Agreement.

On March 16, 2015, HHSC released its Request for Proposals No. 529-16-0003 for Nurse-Family

Partnership Program Services (the RFP). For purposes of the Agreement, the RFP shall be deemed to

include all formal written Addenda thereto and all official responses to vendor questions issued by HHSC

prior to the due date for receipt of vendor responses (including without limitation, Addendum #1 dated

March 17, 2015, Addendum # 2 dated March 23, 2015, Addendum #3 dated March 26, 2015, Addendum

#4 dated April 1, Addendum #5 dated April 10, 2015, and Addendum #6 dated April 14, 2015). HHSC

determined that the CONTRACTOR’s proposed project work plan, background/experience, and project

cost have demonstrated CONTRACTOR has the ability to implement and operate Nurse-Family

Partnership Program and that it is in the best interest of the State to negotiate and execute this Agreement

with CONTRACTOR.

CONTRACTOR is considered a recipient of state grant funds for the purposes of this Agreement.

2

Section 2.03 CONTRACTOR’s Experience and Qualifications.

CONTRACTOR assures it has the skills, qualifications, expertise, financial resources and experience

necessary to provide the services and deliverables described in this Agreement. CONTRACTOR certifies

that it is currently approved to implement the Nurse-Family Partnership Model by the Nurse-Family

Partnership National Service Office (NFPNSO).

Section 2.04 Mission Objectives.

(a) CONTRACTOR’s acknowledgement.

CONTRACTOR acknowledges its understanding that HHSC’s overall objective in engaging

CONTRACTOR pursuant to this Agreement is to obtain efficiently delivered services for the

establishment and operation of local NFP programs.

(b) CONTRACTOR’s understanding of HHSC’s Mission objectives.

CONTRACTOR acknowledges its understanding of HHSC’s desire to achieve the following primary

Mission Objectives:

(1) To utilize registered nurses to regularly visit the homes of low-income, first-time mothers to

provide services to:

Improve pregnancy outcomes;

Improve child health and development; and

Improve family economic self-sufficiency and stability.

HHSC will also assess the degree to which the program reduces the incidence of child abuse and

neglect.

(2) Contractor must contract with Nurse-Family Partnership National Service Office in order to

achieve these objectives.

(c) CONTRACTOR’s commitment and understanding.

In entering into this Agreement, CONTRACTOR has had the opportunity to review and understand

HHSC’s mission and objectives, and based on such review and understanding, CONTRACTOR

represents and warrants that it has the capacity to perform in accordance with the terms and conditions of

this Agreement.

Section 2.05 CONTRACTOR’s Inducements.

(a) Based upon the CONTRACTOR’S representations, these representations may be regarded, as

statements upon which HHSC may reasonably rely in connection with the award of this

Agreement, are true, accurate, and complete to the best of CONTRACTOR’s knowledge in all

respects.

(b) HHSC is relying, and will continue to rely throughout the Term of this Agreement, upon the

truthfulness, accuracy and completeness of such written assurances, as inducements made by the

CONTRACTOR to HHSC to enter into this Agreement. Moreover, HHSC would not have

entered into this Agreement with the CONTRACTOR but for such assurances.

(c) CONTRACTOR acknowledges that HHSC is relying upon such assurances and acknowledges

their materiality and significance. In light of the foregoing, the CONTRACTOR hereby

unequivocally represents to HHSC that the statements in the Sections 2.05-2.05 are true, accurate

and complete to the best of CONTRACTOR’s knowledge in all respects.

3

Section 2.06 Agreement Elements.

The Agreement between the Parties will consist of the following documents and in the event of any

conflict or contradiction between or among the Agreement elements, the documents shall control in the

order of precedence listed below, starting with the document of highest precedence:

(a) This final, executed cover document that consolidates all the elements of the Agreement (the

Cover Document);

(b) The document entitled “Uniform Contract Terms and Conditions, Version 1.5” including its

Attachment A “Data Use Agreement, Ver. 8.3”, (attached hereto and incorporated as Exhibit C to

this Agreement);

(c) The document entitled “HHSC RFP No. 529-16-0003” (the RFP),

http://www.hhsc.state.tx.us/CONTRACT/529160003/RFP.SHTML, (incorporated by reference as

Exhibit A to this Agreement);

(d) The document entitled “Uniform Grant Management Standards Governor’s Office of Budget and

Planning (As Adopted June 2004)”, http://governor.state.tx.us/files/state-

grants/UGMS062004.doc, (incorporated by reference as Exhibit D to this Agreement);

(e) The document entitled “Additional Contract Requirements”, (attached hereto and incorporated as

Exhibit E to this Agreement);

(f) The document entitled “Reporting Requirements”, (attached hereto and incorporated as Exhibit F

to this Agreement);

(g) The document entitled “Performance Measures”, (attached hereto and incorporated as Exhibit G

to this Agreement);

(h) The document entitled “Contract Budget”, (attached hereto and incorporated as Exhibit H to this

Agreement); and

(i) The document entitled “CONTRACTOR's proposed Scope of Work”, (attached hereto and

incorporated as Exhibit B to this Agreement).

Section 2.07 Term of the Agreement.

(a) The Term of this Agreement will begin upon execution of this Agreement, as defined by HHSC’s

Uniform Terms and Conditions, Version 1.5, and will expire on August 31, 2016 (the “Expiration

Date”) unless terminated sooner or extended pursuant to the terms and conditions of this

Agreement.

(b) The Parties may extend the Term of the Agreement by written amendment to the Agreement for

with one year or two year extensions for up to six years, or as necessary to complete the mission

of this Agreement. All contract extensions beyond the Expiration Date will be subject to good

faith negotiations between the Parties and mutual agreement to the terms and conditions set forth

in the extensions in compliance with Article VI of this Agreement.

Section 2.08 Key Staff.

The following Program Managers will serve as the primary contacts for all administrative issues:

http://www.hhsc.state.tx.us/CONTRACT/529160003/RFP.SHTML

http://governor.state.tx.us/files/state-grants/UGMS062004.doc


4

Donna Wood

Texas Home Visiting (THV) Program Manager

Health and Human Services Commission (HHSC)

P.O. Box 13247, MC 1214

Austin, Texas 78711

Phone: 512-420-2878

Fax: 512-706-7340

Email: [email protected]

Hector F. Gonzales, MD, MPH

Health Director

City of Laredo

Phone: 956-795-4920

Fax: 956-726-2632


The following Contract Manager will serve as primary contact for all invoices, purchase vouchers, and

reporting deliverables:

Kim Willett CTCM

Contract Manager

Office of Health Coordination and Consumer Services

Twin Towers Building MC 1214

1106 Clayton Lane, Ste. 225E

Austin, Texas 78723

Phone: 512-420-2854

Fax: 512-706-7340


Section 2.09 Notices.

(a) Delivery of Notice

Any notice or other legal communication required or permitted to be made or given by either Party

pursuant to this Agreement will be in writing and deemed to have been duly given:

(1) Three (3) business days after the date of mailing if sent by registered or certified U.S.

mail, postage prepaid, with return receipt requested;

(2) When transmitted if sent by facsimile, provided a confirmation of transmission is

produced by the sending machine; or

(3) When delivered if delivered personally or sent by express courier service.

(b) Notice to CONTRACTOR

Any notice under this Agreement will be sufficient if delivered to the following persons or their

successors.

(1) Communications that are routine and administrative in nature should be sent to the

Program and Contract Managers identified in Section 2.08.

(2) Legal notices should be sent to the following:




5

Chris Traylor, Executive Commissioner

Karen Ray, Chief Counsel

Health and Human Services Commission

4900 North Lamar Blvd.

Austin, Texas 78751

Fax: 512-424-6586

Jesus M. Olivares

City Manager

City of Laredo

1110 Houston Street

P.O. Box 579

Laredo, Texas 78040

Phone: 956-791-7302

Fax: 956-791-7498


(c) Change of Designee

Either Party may change the above-referenced designees or addresses with five (5) days written

notice to the other Party.

Section 2.10 Laws and Regulations Governing the Procurement of the Services.

It is the express intention of the Parties that this Agreement be a procurement of services meeting all

applicable requirements of the following:

(a) Texas Government Code, Section 2155.144;

(b) 1 T.A.C. Chapter 391; and

(c) Any other applicable provisions of state or federal law.

Section 2.11 Laws and Regulations Governing the Administration of the Agreement

The Parties shall administer the Agreement in accordance with the following rules and regulations:

(a) Texas Government Code, Chapter 531, as amended or modified, and any administrative rules

adopted thereunder;

(b) Uniform Grant Management Standards (UGMS) as provided in Exhibit D; and

(c) Any other applicable provisions of state law.

Section 2.12 Laws and regulations pertaining to this Agreement

Compliance with all state requirements, including any changes received by HHSC and amended in

this Agreement during the contract Term, is required. CONTRACTOR agrees to comply and to cause

each of its contractors or subcontractors to comply with all relevant state requirements as applicable,

including:


6

Audit Requirements Grantees expending $500,000 or more in state grant funds during the fiscal year are subject

to the most current State Single Audit Circular issued under the Uniform Grant Management

Standards (UGMS): http://www.window.state.tx.us/procurement/catrad/ugms.pdf.

Grantees must electronically submit to the approved funding agency and Program staff

([email protected]), copies of any single audit conducted in accordance

with the State Single Audit Circular issued under UGMS, within 30 calendar days after the

grantee receives the audit results or nine months after the end of the audit period, whichever

is earlier.

Section 2.13 Laws and Regulations Governing Civil Rights.

(a) CONTRACTOR agrees to comply and require its subrecipients to comply with state and federal

anti-discrimination laws, including without limitation:

(1) Title VI of the Civil Rights Act of 1964 (42 U.S.C. §2000d et seq.);

(2) Section 504 of the Rehabilitation Act of 1973 ( 29 U.S.C. §794) (implemented at 45

C.F.R. parts 84—85) which prohibits discrimination against an otherwise qualified

handicapped individual in any program or activity receiving federal assistance;

(3) Americans with Disabilities Act of 1990 (42 U.S.C. §12101 et seq.);

(4) Age Discrimination Act of 1975 (42 U.S.C. §§6101-6107);

(5) Title IX of the Education Amendments of 1972 (20 U.S.C. §§1681-1688);

(6) Food Stamp Act of 1977 (7 U.S.C. §200 et seq.); and

(7) HHSC’s administrative rules, as set forth in the Texas Administrative Code, to the extent

applicable to this Agreement.

(b) CONTRACTOR agrees to comply with all amendments to the above-referenced civil rights laws,

and all requirements imposed by the regulations issued pursuant to these laws. These laws

provide in part that no persons in the United States may, on the grounds of race, color, national

origin, sex, age, disability, political beliefs, or religion, be excluded from participation in or

denied any aid, care, service or other benefits provided by Federal or State funding, or otherwise

be subjected to discrimination.

(c) CONTRACTOR agrees to comply with Title VI of the Civil Rights Act of 1964, and its

implementing regulations at 45 C.F.R. Part 80 or 7 C.F.R. Part 15, prohibiting a CONTRACTOR

from adopting and implementing policies and procedures that exclude or have the effect of

excluding or limiting the participation of clients in its programs, benefits, or activities on the basis

of national origin. Applicable state and federal civil rights laws require CONTRACTOR to

provide alternative methods for ensuring access to services for applicants and recipients who

cannot express themselves fluently in English. CONTRACTOR agrees to ensure that its policies

do not have the effect of excluding or limiting the participation of persons in its programs,

benefits, and activities on the basis of national origin. CONTRACTOR also agrees to take

reasonable steps to provide services and information, both orally and in writing, in appropriate

languages other than English, in order to ensure that persons with limited English proficiency are

effectively informed and can have meaningful access to programs, benefits, and activities.

(d) CONTRACTOR agrees to comply with Executive Order 13279, and its implementing regulations

at 45 C.F.R. Part 87 or 7 C.F.R. Part 16. These provide in part that any organization that

participates in programs funded by direct financial assistance from the United States Department

of Agriculture or the United States Department of Health and Human Services shall not, in

http://www.window.state.tx.us/procurement/catrad/ugms.pdf


7

providing services, discriminate against a program beneficiary or prospective program

beneficiary on the basis of religion or religious belief.

(e) Upon request, CONTRACTOR will provide HHSC with copies of all of the CONTRACTOR’s

civil rights policies and procedures.

(f) CONTRACTOR agrees to notify HHSC’s Civil Rights Office of any civil rights complaints

received relating to its performance under this Agreement. This notice must be delivered no more

than ten (10) calendar days after receipt of a complaint. Notice provided pursuant to this section

must be directed to:

HHSC Civil Rights Office

701 W. 51st Street, Mail Code W206

Austin, Texas 78751

Phone Toll Free: (888) 388-6332

Phone: (512) 438-4313

TTY Toll Free: (877) 432-7232

Fax: (512) 438-5885

Section 2.14 Conflicts of Interest.

(a) Representation

CONTRACTOR agrees to comply with applicable state and federal laws, rules, and regulations

regarding conflicts of interest in the performance of its duties under this Agreement.

CONTRACTOR warrants that it has no interest, and will not acquire any direct or indirect

interest, that would conflict in any manner or degree with its performance under this Agreement.

(b) General Duty Regarding Conflicts of Interest

CONTRACTOR will establish safeguards to prohibit employees from using their positions for a

purpose that constitutes or presents the appearance of personal or organizational conflict of

interest, or personal gain. CONTRACTOR will operate with complete independence and

objectivity without actual, potential or apparent conflict of interest with respect to the activities

conducted under this Agreement with the State of Texas.

CONTRACTOR shall abide by the terms and conditions of the Article 12 of the HHSC Uniform

Terms and Conditions, Version 1.5, regarding Conflicts of Interest, as made part of this

Agreement in Exhibit C.

Section 2.15 Special Terms and Conditions-HIPPA-Protected Health Information.

To the extent that CONTRACTOR creates, reviews, receives, uses or discloses Protected Health

Information (PHI), CONTRACTOR is a Business Associate of HHSC and the Data Use Agreement

(DUA) (Exhibit C Attachment A, attached hereto and incorporated herein) applies.

Section 2.16 Prohibition Against Performance Outside the United States.

(a) Findings

(1) HHSC finds the following:

(a) HHSC is responsible for administering several public programs that require the

collection and maintenance of information relating to persons who apply for and

8

receive services from HHSC programs. This information consists of, among other

things, personal financial and medical information and information designated

“Confidential Information” under state and federal law and this Agreement. Some of

this information may, within the limits of the law and this Agreement, be shared from

time to time with CONTRACTOR or a subcontractor for purposes of performing the

Services or providing the Deliverables under this Agreement.

(b) HHSC is also responsible for collecting and maintaining personal information,

including personal financial and medical information, concerning persons employed

by HHSC and other health and human services agencies. Some of this information

may be shared from time to time with CONTRACTOR or a subcontractor or

collected and maintained by CONTRACTOR or a subcontractor for purposes of

performing the Services or providing the Deliverables under this Agreement.

(c) HHSC is legally responsible maintaining the confidentiality and integrity of

information relating to applicants and recipients of HHSC services and employees of

HHS agencies and ensuring that any person or entity that receives such information,

including CONTRACTOR and any subcontractor, is similarly bound by these

obligations.

(d) HHSC also is responsible for the development and implementation of computer

software and hardware to support HHSC programs. These items are paid for, in

whole or in part, with state and federal funds. The federal agencies that fund these

items maintain a limited interest in the software and hardware so developed or

acquired.

(e) Some of the software used or developed by HHSC may also be subject to statutory

restrictions on the export of technology to foreign nations, including but not limited

to the Export Administration Regulations, 15 C.F.R. Parts 730-774.

(2) In view of these obligations, and to ensure accountability, integrity, and the security of

the information maintained by or for HHSC and the work performed on behalf of HHSC, HHSC

DETERMINES that it is necessary and appropriate to require that:

(a) All work performed under this Agreement must be performed exclusively within the

United States; AND

(b) All information obtained by CONTRACTOR or a subcontractor under this

Agreement must be maintained within the United States.

(3) Further, HHSC finds it necessary and appropriate to forbid the performance of any work

or the maintenance of any information relating or obtained pursuant to this Agreement to occur

outside of the United States except as specifically authorized or approved by HHSC.

(b) Meaning of “within the United States” and “outside the United States”

(1) As used in this Section 2.16, the term “within the United States” means any location

inside the territorial boundaries comprising the republic of the United States of America,

including of any of the 48 coterminous states in North America, the states of Alaska and Hawaii,

and the District of Columbia.

9

(2) Conversely, the phrase “outside the United States” means any location that is not within

the territorial boundaries comprising the republic of the United States of America, including of

any of the 48 coterminous states in North America, the states of Alaska and Hawaii, and the

District of Columbia.

(c) Maintenance of Confidential Information

(1) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for

CONTRACTOR must not allow any Confidential Information that CONTRACTOR receives

from or on behalf of HHSC to leave the United States by any means (physical or electronic) at

any time, for any period of time, for any reason.

(2) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for

CONTRACTOR must not permit any person to have remote access to HHSC information,

systems, or Deliverables from a location outside the United States.

(d) Performance of Work under Agreement

(1) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions

specified in paragraph (e) of this Section 2.16, CONTRACTOR and all subcontractors, vendors,

agents, and service providers of or for CONTRACTOR must perform all services under the

Agreement, including all tasks, functions, and responsibilities assigned and delegated to

CONTRACTOR under this Agreement, within the United States.

(a) This obligation includes, but is not limited to, all Services, including but not limited

to information technology services, processing, transmission, storage, archiving, data

center services, disaster recovery sites and services, customer support), medical,

dental, laboratory and clinical services.

(b) All custom software prepared for performance of this Agreement, and all

modifications of custom, third party, or vendor proprietary software, must be

performed within the United States.

(2) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions

specified in paragraph (e) of this Section 2.16, CONTRACTOR and all subcontractors, vendors,

agents, and service providers of or for CONTRACTOR must not permit any person to perform

work under this Agreement from a location outside the United States.

(e) Exceptions

(1) COTS Software - The foregoing requirements will not preclude the acquisition or use of

commercial off-the-shelf software that is developed outside the United States or hardware that is

generically configured outside the United States.

(2) Foreign-made Products and Supplies - The foregoing requirements will not preclude

CONTRACTOR from acquiring, using, or reimbursing products or supplies that are

manufactured outside the United States, provided such products or supplies are commercially

available within the United States for acquisition or reimbursement by HHSC.

(3) HHSC Prior Approval - The foregoing requirements will not preclude CONTRACTOR

from performing work outside the United States that HHSC has approved in writing and that

10

HHSC has confirmed will not involve the sharing of Confidential Information outside the United

States.

(f) Disclosure

CONTRACTOR must disclose to HHSC all Services and Deliverables under or related to

this Agreement that CONTRACTOR intends to perform or has performed outside the United

States, whether directly or via subcontractors, vendors, agents, or service providers.

(g) Remedy

(1) CONTRACTOR’s violation of this Section 2.16 will constitute a material breach in

accordance with Section 11.02 of the HHSC Uniform Contract Terms and Conditions, version

1.5. CONTRACTOR will be liable to HHSC for all actual and consequential damages in

accordance with the HHSC Uniform Contract Terms and Conditions.

(2) For breach of the requirements under this Section 2.16, HHSC may terminate the

Agreement with Notice to CONTRACTOR at least 1 calendar day before the effective date of

such termination.

Article III. SCOPE OF WORK – SERVICES AND DELIVERABLES

Section 3.01 Scope of the Services and Deliverables.

The Services and Deliverables that CONTRACTOR is required to provide under this Agreement are

described in the following items:

(a) Request for Proposals No. 529-16-0003 for Nurse-Family Partnership Program Services (Exhibit

A),

(b) CONTRACTOR's proposed Scope of Work (Exhibit B),

(c) Additional Contract Requirements (Exhibit E),

(d) Reporting Requirements (Exhibit F), and

(e) Performance Measures (Exhibit G).

Section 3.02 Performance Measurement and Monitoring.

HHSC will monitor CONTRACTOR’s performance of the Services and production of the

Deliverables identified in the above Section 3.01 of this Agreement on the Effective Date and as they may

be modified from time-to-time by mutual agreement of the Parties.

Section 3.03 Additional State of Texas or Texas Government Customers.

(a) CONTRACTOR may propose or offer services similar in scope, kind, and quality to the Services

under this Agreement to other State of Texas administrative agencies and other governmental

customers in the State of Texas.

(b) Such proposals or offers to other potential Texas government customers may propose to utilize

facilities and products CONTRACTOR developed, acquired or will develop or acquire for the

purpose of performing the Services under this Agreement, provided that such proposals or offers

do not include without HHSC’s prior consent, the following:

(1) Confidential Information;

11

(2) Deliverables;

(3) Custom Software and related documentation; or

(4) Any other property owned or provided by HHSC under this Agreement.

(b) CONTRACTOR must bear all costs of such additional business development and may not charge

or offset any expense related to such business development to HHSC.

(c) Operating Fees for the Services will be adjusted in accordance with Section 3.03 of this

Agreement to account for any additional Texas government customers for which

CONTRACTOR supplies services similar in scope, kind, and quality to the Services under this

Agreement.

Article IV. TERMS AND CONDITIONS OF PAYMENT

Section 4.01 Total Cost.

The total cost of the Services and Deliverables supplied by CONTRACTOR to HHSC for the term of

the funding period beginning September 1, 2015 and ending August 31, 2016 will not exceed

$415,000.00. Furthermore, in accordance with the grant terms provided to HHSC, the total cost of the

Services and Deliverables supplied by CONTRACTOR to HHSC during the Term of this Agreement for

specific activities and periods will not exceed the amounts indicated in Exhibit H.

Section 4.02 General Payment Terms.

(a) HHSC shall pay CONTRACTOR an amount up to but not to exceed $415,000.00 for the budget

period beginning September 1, 2015 and ending August 31, 2016, whereas those payments will

be made on a monthly cost reimbursement basis, in response to an invoice and purchase voucher

being received and monthly deliverables being approved. HHSC shall pay the CONTRACTOR

an amount not to exceed the total agreed upon amount in the CONTRACTOR’s approved budget

as represented in Exhibit H for the term beginning upon execution and ending August 31, 2016.

(b) An initial startup payment of up to $50,000.00 in contract funds may be requested by the

CONTRACTOR to initiate the program activities. After this initial payment, ongoing

reimbursements will be made in the following manner: HHSC will make payments to the

CONTRACTOR on a monthly cost reimbursement basis, in response to HHSC's receipt and

approval of CONTRACTOR's invoice, purchase voucher, and the required monthly deliverables.

(c) CONTRACTOR will submit to the HHSC Contract Manager and THV Project Manager an

Invoice, Purchase Voucher, and all required expenditure documentation for the amount of

expenses incurred by the CONTRACTOR on a monthly basis no later than the last day of the

month following that in which expenditure occurred, if the last day falls on a weekend or holiday

the documents will be due the next business day.

(d) HHSC’s duty to pay the amount described in paragraph (b) of this section is subject to offset of

any amounts HHSC determines are owed to HHSC or to which there is a bona fide dispute

regarding HHSC’s duty to pay.

(e) CONTRACTOR will obtain general liability insurance in an amount not less than the budget

period identified in Exhibit H and will submit evidence of that insurance to HHSC within 30 days

of first contract payment received by CONTRACTOR for each budget period.

12

Section 4.03 Additional Payment Terms.

(a) Funding provided for this Agreement by HHSC may only be used for the budget approved by

HHSC. Funds cannot supplant any federal or state funds for home visiting (defined as an

evidence-based program, implemented in response to findings from a needs assessment, that

includes home visiting as a primary service delivery strategy and is offered on a voluntary basis

to pregnant women or children birth to age five targeting the participant outcomes in the

legislation (P.L. 111-148)).

(b) No more than 10% of the funds used to pay for the deliverables listed below may be used for

indirect costs, unless CONTRACTOR has a federally negotiated rate or otherwise approved by

HHSC Texas Home Visiting Program.

(c) Any shifts among budget line items that account for more than 10 percent of a specific line item

must be authorized by the HHSC THV Project Manager prior to the line item change and the

CONTRACTOR must submit a revised budget using the approved HHSC budget revision form

provided.

(d) The HHSC THV Project Manager must be notified in writing within 15 days following any shifts

among budget line items that account for less than 10 percent of a specific line item and the

CONTRACTOR must submit a revised budget using the approved HHSC budget revision form

provided

Section 4.04 Required Invoices for Payment.

(a) CONTRACTOR shall submit invoices and State of Texas Purchase Voucher to HHSC for

payments according to Section 4.02. CONTRACTOR shall utilize invoice and purchase voucher

template provided by HCCS.

(b) Invoice and State of Texas Purchase Voucher shall include CONTRACTOR’s contact

information and business address, tax identification number information, HHSC contract number,

and amount of payment requested. Invoice and State of Texas Purchase Voucher shall be

submitted to HHSC Contract Manager and THV Project Manager.

Section 4.05 Time and Manner of Payment.

(a) Payments for Services and Deliverables under the Agreement will be made in the following

manner. HHSC THV Project Manager will approve payments upon receipt and approval of

invoices and any required deliverables.

(b) If HHSC disputes payment of an invoice for purposes of enforcing a remedy or obtaining set-off

against payments due, HHSC may limit payments in accordance with Article 9 of HHSC’s

Uniform Contract Terms and Conditions.

Section 4.06 Failure, Termination or Suspension of HHSC Funding.

Except as otherwise provided in this Agreement, CONTRACTOR understands and expressly assumes

all risks associated with the commitment of delivery of the contracted Services and Deliverables,

including the failure, termination or suspension of funding to HHSC, delays or denials of required third

party approvals, and cost overruns not reasonably attributable to HHSC.

http://www.gpo.gov/fdsys/pkg/PLAW-111publ148/pdf/PLAW-111publ148.pdf

13

Section 4.07 State Auditor’s Office.

CONTRACTOR understands that acceptance of funds under this Agreement constitutes acceptance of

the authority of the Texas State Auditor's Office, or any successor agency (collectively, “Auditor”), to

conduct an audit or investigation in connection with those funds pursuant to Section 12.055(e), Texas

Health & Safety Code. CONTRACTOR agrees to cooperate with the Auditor in the conduct of the audit

or investigation, including without limitation providing all records requested. CONTRACTOR will

include this provision in all contracts with permitted subcontractors.

Article V. PERFORMANCE & TAILORED REMEDIES MATRIX

Section 5.01 Performance Remedies – Damages.

(a) CONTRACTOR is expected to meet or exceed the objectives and standards set forth in this

Agreement. All areas of responsibility and all requirements listed in the Agreement will be

subject to performance evaluation by HHSC.

(b) Performance reviews may be conducted at HHSC’s discretion at any time and may relate to any

responsibility and/or requirement set forth in this Agreement.

(c) Any and all responsibilities and requirements not fulfilled may be subject to the remedies set

forth in Article 11 of HHSC’s Uniform Contract Terms and Conditions. Damages may be

assessed in accordance with Section 11.02 of HHSC’s Uniform Contract Terms and Conditions.

Article VI. BUSINESS PLAN FOR NEGOTIATING CONTRACT AMENDMENTS

Section 6.01 Amendments.

This Article VI represents the Parties’ Business Plan for negotiating amendments and modifications

to the Agreement, as required by Article 7 of HHSC’s Uniform Contract Terms and Conditions.

Section 6.02 Required compliance with modification procedures.

(a) No different or additional services, work, or products will be authorized or performed except

pursuant to a written amendment or modification of this Agreement that is executed in

compliance with this Article and Article 7 of the HHSC Uniform Terms and Conditions.

(b) No waiver of any term, covenant or condition of this Agreement will be valid unless executed in

compliance with this Article VI.

(c) CONTRACTOR will not be entitled to payment for any Services, Deliverables, work or products

that are not authorized by a properly executed amendment or modification to this Agreement, or

through the express authorization of HHSC.

14

Article VII. AUTHORITY TO EXECUTE

The Parties have executed this Agreement in their capacities as stated below with authority to bind

their organizations on the dates set forth by their signatures.

IN WITNESS HEREOF, HHSC and CONTRACTOR have each caused this Agreement to be signed

and delivered by its duly authorized representative.

HEALTH & HUMAN SERVICES COMMISSION CITY OF LAREDO

PATRICIA VOJACK JESUS M. OLIVARES

DEPUTY EXECUTIVE COMMISSIONER CITY MANAGER

DATE SIGNED: DATE SIGNED:

1

STATE OF TEXAS

COUNTY OF TRAVIS


BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT A

REQUEST FOR PROPOSALS

HHSC’s Nurse-Family Partnership Request for Proposals, RFP No. 529-16-0003, including all

Addenda issued thereto, is incorporated by reference as Exhibit A to this Agreement.

THE RFP AND ADDENDA CAN BE VIEWED AT THIS LINK:

HTTP://WWW.HHSC.STATE.TX.US/CONTRACT/529160003/RFP.SHTML

http://www.hhsc.state.tx.us/contract/529160003/rfp.shtml

1

STATE OF TEXAS

COUNTY OF TRAVIS


BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT B

CONTRACTOR'S PROPOSED SCOPE OF WORK

The CONTRACTOR's proposed Scope of Work is attached and incorporated as Exhibit B to this

Agreement.

1

STATE OF TEXAS

COUNTY OF TRAVIS


BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT C

UNIFORM CONTRACT TERMS AND CONDITIONS, VERSION 1.5

The document entitled “Uniform Contract Terms and Conditions, Version 1.5” including

Attachment A “Data Use Agreement, Ver. 8.3”, is attached and incorporated as Exhibit C to this

Agreement.

1

STATE OF TEXAS

COUNTY OF TRAVIS


BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT D

UNIFORM GRANT MANAGEMENT STANDARDS GOVERNOR’S OFFICE OF BUDGET AND PLANNING (AS

ADOPTED JUNE 2004)

UNIFORM GRANT MANAGEMENT STANDARDS GOVERNOR’S OFFICE OF

BUDGET AND PLANNING (AS ADOPTED JUNE 2004) is incorporated by reference as

Exhibit D to this Agreement.

THE STANDARDS CAN BE VIEWED AT THIS LINK:



1

STATE OF TEXAS

COUNTY OF TRAVIS


BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT E

ADDITIONAL CONTRACT REQUIREMENTS

The CONTRACTOR is responsible for and must ensure that each of the contract requirements stated

below are met:

CONTRACTOR must contract directly with Nurse-Family Partnership National Service Office

(NFPNSO) and pay all applicable fees directly to NFPNSO.

CONTRACTOR must provide flexible schedules to nurse home visitors and nurse supervisors to allow

for evening and weekend work to accommodate clients' schedules.

CONTRACTOR must use the recommended data collection system required by the model developer for

the Nurse-Family Partnership Program. All required data must be entered directly into the applicable

system and the CONTRACTOR must perform a quality check to ensure all data required by HHSC is

included and the data is accurate. This quality check must include timely review and response to HHSC-

generated quality assurance reports. Data must be entered each month according to the NFPNSO

requirements and HHSC’s guidance.

CONTRACTOR will take all appropriate steps to maintain client confidentiality and obtain any necessary

written client consents for data analysis or disclosure of protected health information, in accordance with

applicable federal and state laws, including, but not limited to, authorizations, data use agreements,

business associate agreements, as necessary.

CONTRACTOR assumes responsibility for knowledge of and compliance with the Texas Nurse Practice

Act, state laws, regulations, and licensing requirements pertaining to nursing practice and state laws and

regulations pertaining to mandatory reporting.

CONTRACTOR will ensure that nurses whom it employs to implement that Program are able to provide

care to clients in a manner consistent with the NFP Visit-to-Visit Guidelines.

CONTRACTOR is prohibited from engaging in research on program staff and/or client population

without prior written authorization from HHSC, and the Nurse-Family Partnership national office. This

excludes HHSC required program evaluation.

CONTRACTOR’s staff vacancies must be filled within four months. Vacancies of over four (4) months

will require a staffing plan approved by HHSC.

For purposes of this Agreement, allowable mileage expenses are limited to mileage and parking

reasonable and necessary for implementation of the agreed scope of work. Allowable mileage expenses

2

will not include administrative expenses or other incidental travel expenses. Mileage charges will be

limited to the rates allowed in accordance with the Texas Comptroller’s Travel Allowance Guide at

https://fmx.cpa.state.tx.us/fmx/travel/index.php).

All out-of-state travel must be pre-approved by the HHSC THV Project Manager. Refer to

http://www.gsa.gov/portal/category/21287 for allowable reimbursement rates for lodging and per diem.

All clients receiving services must complete a consent form that includes HHSC approved language,

provided to the CONTRACTOR. The original document must be securely maintained by the

CONTRACTOR.

In order to ensure client health and safety, CONTRACTOR must follow HHSC requirements regarding

conducting criminal background checks and maintaining records.

All CONTRACTOR staff members who interact with clients are required to complete the HHSC-

approved training on reporting child maltreatment within 30 days of date of hire and ensuring all staff

members are aware of their duty to report, as outlined in the Texas Family Code, Chapter 261. Records

acknowledging successful completion of the training by each staff member must be maintained by

CONTRACTOR.

CONTRACTOR must complete ongoing trainings or meetings that are required by the program model

and HHSC, including an initial contractor kick-off meeting after execution of the Agreement.

All home visitors must be provided with HHSC-approved information on personal safety in the field.

Records acknowledging receipt of this, signed by the home visitor, must be maintained by

CONTRACTOR within thirty (30) days of hire.

https://fmx.cpa.state.tx.us/fmx/travel/index.php

http://www.gsa.gov/portal/category/21287

http://www.statutes.legis.state.tx.us/SOTWDocs/FA/htm/FA.261.htm

1

STATE OF TEXAS

COUNTY OF TRAVIS

AGREEMENT BETWEEN THE


AND

CITY OF LAREDO

FOR THE


EXHIBIT F

REPORTING REQUIREMENTS

The reports listed below are due to the HHSC THV Project Manager by the last day of the month for the

prior month. If the last day of the month falls on a weekend or holiday, all Reporting Requirements will

be due on the next business day. Reports should be sent to the Texas Home Visiting mailbox at:

[email protected].

1. CONTRACTOR will submit a Monthly Program Update using the template provided by HHSC.

2. CONTRACTOR will submit a monthly expenditure report using the format provided by HHSC for

allowable expenses that includes an invoice and the scanned HHSC purchase voucher with an

original signature.

3. CONTRACTOR will work with HHSC during that last month of the fiscal year to submit accurate

year-end expenditures as soon as possible.

CONTRACTOR will report additional data elements as requested by HHSC. CONTRACTOR will make

all reasonable efforts to assure that all data elements are collected and reported to HHSC upon its request,

or as soon as reasonably possible. Templates and data element requests will not constitute the entirety of

deliverables and requirements required for submission by this Agreement.


1

STATE OF TEXAS

COUNTY OF TRAVIS



AND

CITY OF LAREDO

FOR THE


EXHIBIT G

PERFORMANCE MEASURES

Performance Measures quantitatively illustrate compliance with services required as part of the Texas

Home Visiting Program. These performance measures assess operational components and were selected

as critical elements in progress towards positive program outcomes.

Performance Measures:

Output Measures-CONTRACTOR shall meet all of the following outputs once program implementation

has begun:

Output #1: The expected number of families are served annually

Indicator: The number of unduplicated families served in the 12-month budget period by all program

models.

Target: 88

Data Source: THV database and/or program model databases

Methodology: Count of the number of unduplicated mothers served by NFP or families served by other

programs that received a minimum of one home visit during the 12-month budget period.

Output #2: The expected number of children are served annually

Indicator: The number of unduplicated children served in the 12-month budget period by all program

models.

Target: 88


Methodology: Count of the number of unduplicated children that received a minimum of one home visit

during the 12-month budget period. HHSC will work with NFP providers to determine appropriate

tracking.

Output #3: Staff are trained to deliver the evidence-based model

Indicator: The percentage of staff that are trained in the evidence-based model within the timeframes

required by the evidence-based models.

Target: 100%

Data Source: Monthly reports

2

Methodology: Total number of staff who are trained according to model requirements and timelines

divided by the total number of staff providing services under this Agreement. Multiply by 100 and state

as a percentage.

Output #4: Program will maintain family capacity throughout the contract Term.

Indicator: The number of families served at any given point as compared to the number of funded slots

(Output #1).

Target: 100% with a 15% allowable variance


Methodology: Total number of families served at a point in time divided by the total number of families

that are funded under the Agreement. Multiply by 100 and state as a percentage.

Output #5: Program will ensure broad participation in a local early childhood coalition (not

applicable for Nurse-Family Partnership)

Output #6: Continuous Quality Improvement (CQI) activities are conducted annually

Indicator: Completed measurement and reporting of CQI related data

Target: 100%

Data Source: Quarterly reports and/or CQI updates

Methodology: Number of CQI data measurements reported divided by number of CQI measurements

expected to complete CQI projects. Number of CQI measurements expected to be completed for CQI

projects will be established in partnership with HHSC.

Output #7: The Early Development Instrument will be used to identify community needs (not

applicable for Nurse-Family Partnership)

Output #8: Families will remain engaged in the program for a minimum of one year

Indicator: The percentage of families that leave the program prior to receiving 12-months of services,

and have not completed the program or aged out.

Target: 50%


Methodology: Number of families who left the program prior to completing 12 or 10 months of services

(based on program model) who have not completed the program, divided by the total number of families

who have an enrollment date greater than 12 or 10 months in the past (based on model.) Multiply by 100

and state as a percentage.

Outcome Measures-Contractor shall meet two or more of the following outcome measures once program

implementation has begun:

Outcome #1: Women will breastfeed for at least six months postpartum

Indicator: Percentage of women who breastfeed for at least six months postpartum.

Target: 25%

Data Source: THV data collection system and/or program model databases

Methodology: Number of women breastfeeding at six months postpartum divided by the total number of

women at six months postpartum. Multiply by 100 and state as a percentage.

Outcome #2: Children will attend recommended well-child visits

3

Indicator: Percentage of recommended well-child visits attended by children during their first six months

in the program.

Target: 55%

Data Sources: THV data collection system and/or program model databases

Methodology: Number of well-child visits attended by the child during their first six months divided by

the total number of recommended visits. Multiply by 100 and state as a percentage.

Outcome #3: Babies will be born at full term

Indicator: The rate of babies in the program that are born premature compared to the Texas Medicaid

premature birth rate.

Target: A lower premature birth rate.


Methodology: The number of babies in the program born pre-term (prior to 37 weeks of pregnancy)

divided by the total number of babies born. This rate is compared to the pre-term birth rate for all births

covered by Texas Medicaid for the most recent year available.

Outcome #4: Parents will increase the number of days per week that they read to or with their

child(ren)

Indicator: Difference between number of days per week a child is read to or with by their primary

caregiver(s) upon enrollment and after 12-months of program participation.

Target: 0.5


Methodology: Average of the individual improvement for each child. The individual improvement

measure is calculated by taking each child’s average frequency at intake and after one year in the

program. These within-child averages are then added together and divided by the calculated denominator

in order to produce an overall improvement measure.

Outcome #5: Parent-child relationships will improve

Indicator: Difference between parent child relationship subscale score on the Protective Factors Survey

(PFS) upon enrollment and score after 12-months of program participation.

Target: 0.3


Methodology: Average of the individual improvement for each score. Improvement is defined as an

increase in score on the subscale relating to strong parent-child relationships over their first year in the

program. Improvement is measured using an individual comparison from program entry to one year post

enrollment. These within-parent averages are then added together and divided by the calculated

denominator in order to produce an overall improvement measure.

Outcome #6: Primary caregiver(s) will increase their ability to cope with parental stress

Indicator: Difference between perceived support subscale score on the Protective Factors Survey (PFS)

upon enrollment and score after 12-months of program participation.

Target: 0.3


Methodology: Average of the individual improvement for each score. Sum of all perceived support

subscale scores at enrollment divided by the total number of parent respondents. Sum of all perceived

support subscale scores at 12-months program participation divided by the total number of parent

4

respondents. These numbers are then compared as a pre-test and post-test values to assess improvement.

Improvement is defined as an increase in score on the subscale relating to supports and coping with stress

over their first year in the program. Improvement is measured using an individual comparison from

program entry to one year post enrollment. These within-parent averages are then added together and

divided by the calculated denominator in order to produce an overall improvement measure.

Outcome #7: Primary caregiver(s) will increase in working or education

Indicator: Percentage of primary caregivers increasing their number of hours attending educational

programs and/or working during their first year in the program.

Target: 30%


Methodology: Improvement is an increase in the average number of hours per week spent by primary

caregivers in educational programs and/or working during their first year in the program, measured using

an individual comparison from program entry to one year post enrollment. The number of primary

caregivers showing an improvement is then divided by the total number of primary caregivers.

Corrective Action:

HHSC Texas Home Visiting Program staff will provide continued support and consultation to

CONTRACTOR throughout the term of the Agreement. At the discretion of the HHSC Program

Manager, Corrective Action Plans may be requested if the CONTRACTOR fails to meet contract

requirements.

All Corrective Action Plans must be approved by HHSC, prior to being implemented by the

CONTRACTOR.

If the CONTRACTOR fails to implement their approved Corrective Action Plan, all or part of their

monthly payment may be withheld in accordance with Section 5.01 of HHSC's and CONTRACTOR’s

agreement for the Nurse-Family Partnership Program.

1

STATE OF TEXAS

COUNTY OF TRAVIS



AND

CITY OF LAREDO

FOR THE


EXHIBIT H

CONTRACT BUDGET

TEXAS HEALTH AND HUMAN SERVICES

COMMISSION

1106 Clayton Lane, Austin, Texas 78723

City of Laredo

MNFP

9/01/2015 to 08/31/2016

BUDGET CATEGORIES BUDGET TOTALS

Salaries $199,150.00

Fringe Benefits $92,949.00

Equipment $0.00

Supplies $1,200.00

Travel $23,206.00

Contractual $0.00

Other $98,495.00

In Direct Costs $0.00

TOTAL FY16 BUDGET $415,000.00

RFP No. 529-16-131641

Attachment B

Project Approach Response Template

Respondent Name: City of Laredo Health Department

Section I - Respondent Background and Experience

Section 1.1 General Background and Experience

1.1. Describe Respondent's background and experience in executing projects similar in scope and complexity to the project described in this RFP. If the proposal includes the use of subcontractors, include a similar description of each subcontractor's background and experience.

1.1 Response Space: The City of Laredo Health Department (CLHD) has over 50 years in providing health care services, disease control, preventive care, early disease detection and primary care. In particular MCH services, early detection and preventive health care. Model services include Immunization, WIC, HIV, primary care, women’s health, well child services and epidemiology public health preparedness and response. All of our services incorporate home visits, outreach and education and Disease self management (DSM) as a pillar to wellness, prevention, healthy positive outcomes and quality improvement. The CLHD has tested several models of home visitation services through Promotores, Nurses, case managers, TB, immunization, HIV/STD, women’s health, Healthy Texas Baby and breast feeding outreach and education. The most recent addition is our current Nurse Family Partnership (NFP) home nurse visitation (HNV) which provided enhanced NHV preventive care and case management to 170 first time mothers and 123 children. We also conduct enhanced evidence based strategies in DSM, Buena Vida (early detection), Tuberculosis treatment, Immunization, HIV, and obesity reduction school health services (NIH/CDC approved). Early detection, family support; case management, education and home visitation (HV) especially to high risk women, children and adolescents and first time parents are a major focus in our MCH services and therefore the NFP NHV model fits perfectly. Using diverse models of outreach, education, early detection, case management and the NFP NHV model has made a positive improvement for first time mothers especially because of our high risk population, our infant low birth rate and prematurity. Local officials are committed to health care delivery and partner with the medical community i.e. City/County Blue Ribbon Committee on Health Issues (physicians, hospitals, FQHC, University of Texas Health Sciences Center San Antonio Laredo Campus/UTHSCSA and Women’s Commission) as well the Laredo Health Coalition (LHC) and the Citizens Advisory Board (CAB) who are also stakeholders and providers and serve as a network for services, recruitment and referrals. During our history the CLHD has conducted health care needs assessments, developed plans and prioritized health care issues as a community and in particular addressed disease control, prevention, primary care (40% uninsured, health profession shortage and a medically underserved area) and public health preparedness and response for a Texas/Mexico Binational community. Of the top priorities, MCH services and adolescent health are among the top. This is further displayed by Mayor Pete Saenz and the both Superintendents (Mr. Roberto Santos/UISD and Dr. Marcus Nelson/LISD) who have pledged support to coordinate with the CLHD NFP (MOUS) which also fits into the Mayor’s task force calling on everyone to commit to more “Active Living”. Specifically for NFP, a delegation of Laredo lead by Mayor Pete Saenz, Dr. Hector Gonzalez, Laredo Director of Health and Representative Richard Raymond met with Texas Health and Human Services Chief Deputy Commissioner Chris Traylor to discuss public health and health care on the Texas/Mexico Border. We provided an update of our success with NFP and the 1115 Transformation Waiver and stated that our partnership with HHSC for these two services and funding for them remains a critically important one for our high risk un/underinsured population especially for first time high risk

RFP No. 529-16-131641

mothers and their families. In addition Laredo will continue to support our NFP NHV project with in-kind, incentives funding and with funding for direct health care which many of the NFP moms and their children need during pregnancy but more important in postpartum care and for well child. We have met our NFP goals and because of need, health disparity, cervical cancer disparity, rise in HIV/STD in young persons, adolescent pregnancy, and a significant population that is indigent; the need for NHV funding continuation is critical. In addition NFP is an important partner to assure positive childhood growth and development currently being targeted as a priority by the CLHD, LHC, Early Childhood services and the CAB. Both school districts are special partners for NFP, women and children’s health and have signed MOUs for continued collaboration. Finally NFP is supported by other CLHD services which enhance NFP (MCH, Primary Care and Prevention Services, Family Planning, HIV/STD, Immunizations, WIC and case management). Historically we provide outreach, education, health promotion, DSM, Tuberculosis control, Breastfeeding, nutrition and case management home visitation and outreach; NFP is the newest addition in home visitation and is improving the health of first time mothers and their children. Besides health care, educational workforce, social services and entitlement for mother and child, some mothers and children have been detected with special needs, behavioral health and workforce issues. These have all been provided appropriate support services and/or are in care. to assure operations and quality improvement in addition to an NFP Supervisor the NHV program is supported by other professional CLHD staff and City of Laredo legal, human services, finance, budget, audit and information technology services and are also guided by the Associate Director, Dr. Waldo Lopez. We are familiar with this model and utilize our experience and expertise to ensure the NFP program is successful as we have done with Title V, Title X, Cancer Prevention, early detection and Disease Control services. Other partners such as the CAB, LHC, Providers, Faith based (Mercy, Methodists, Baptists Health Care) are committed to NFP. New partners are the Medicaid Managed Care (MMC) Carriers (Molina, Superior and Driscoll Health Care) who will also support NFP services with incentives and operations to assure moms and their babies have a positive outcome (care seats, cribs, recognition event). More important we are working these new entities for a sustained effort to support mothers and their children.

1.2 Describe up to three (3) contracts awarded to Respondent within the last five (5) years that demonstrate the ability to successfully manage this contract. State whether the Respondent or a subcontractor served as the prime Contractor. Provide a description of the scope of work performed. Include contract dates and contact information for three references that can address the Respondent's ability to successfully execute this contract (customer points of contact, address, telephone number, and email address). If the proposal includes the use of subcontractors, include similar evidence of the subcontractor's experience and success executing contracts. Include this information as an appendix in Section 4 of your proposal.

1.2 Response Space: Cancer Prevention Research Institute of Texas (CPRIT), Austin Texas $2,497,500: 8/1/10-7/31/13 - prime contractor breast, cervical and colon cancer screening, diagnosis and management. Over 3400 persons were seen for care, screening diagnosis, education and home visitation and health outreach 40 cancers were confirmed Ramona Magid, Senior Program Manager for Prevention CPIRT 512-305-8417 NFP $1,907,968: 9/1/11-8/31/15 – prime contractor (HHSC) NHV program that continues to provide HV for 170 pregnant first time moms and following 123 babies for positive birth outcomes, with case management, education support, social services support, entitlement support, workforce support, counseling, behavioral health and healthy birth outcomes with support for positive and healthy child growth, development and wellness

RFP No. 529-16-131641

prevention services. Built enhanced Commuity support for current services and long term through LHC and CAB. '[email protected]', Laura M. Misuk [[email protected]] Title X- $304,122: 4/1/13-3/31/16 – prime contractor (Women’s Health and Family Planning Association of TX) Provides women’s preventive health and family planning with comprehensive medical exams, diagnostic services, laboratory, health education, case management, HV, social services support, entitlement support, workforce support, counseling, behavioral health, STD/HIV services, referrals for specialty treatment. Fran Hagerty, PhD, Chief Executive Officer, Women’s Health & Family Planning Association of Texas, 1114 Lost Creek Blvd., Suite 110, Austin, Texas 78746 Office: 512-448-4857, Fax: 512-222-1470 In addition to these the CLHD manages over 33 contracts with Texas Department of State Health Services (DSHS), Texas Health and Human Services Commission (HHSC), US Food and Drug Administration, USEPA, Substance Abuse and Mental Health Services Administration (SAMSHSA) and in the past with the Centers for Disease control and Prevention and NIH. In particular over the last 4 years we conducted the HHSC NFP NHV program and a DSHS Community Diabetes Prevention program that models DSM as well as a CPRIT cancer prevention project. All of these had a home based outreach NHV or lay HV component. These programs are supported by CLHD professional and technical staff and get additional technical assistance and data systems and reporting support from our budget and grants and data system staff as well the city’s finance, budget, human resources and legal staff for contract compliance and performance measures accomplishment. Specifically, includes the accounts requisition, purchase order, payable, and receivable. We also have a Quality Assurance committee and effort to assure continuous quality improvement. For all the contracts we handle, we are the sole contractor. We have maintained the NFP program for the past three (3) years surpassing our objectives and because of need and performance recently gained a fifth home nurse visitor for an additional caseload of 170 first time low income moms and their babies. We have increase our capacity to deliver excellent NFP services with great support from our primary, and ancillary services, which include MCH and Women’s Health services, Primary care, family planning, HIV/STD, TB Clinic, Immunizations, laboratory services, WIC,, social services (social-case worker, ACA (market place), and entitlement enrollment for Medicaid, CHIP, TANAF, and SNAP, Dental Services, Cancer detection, Buena Vida early detection screening and Healthy Living/Viviendo Mejor DSM. With over 12 contract physicians, two staff nurse practitioners and a team of nurses, medical assistants, and clerks the CLHD continues to provide unmatched support services for the NFP program. Through title V maternal child health contract both mom, and baby can access first class clinical, dental, as well as outreach services. Our Title X Family Planning services provides comprehensive women’s medical exams (includes diabetes, breast, cervical cancer screens and HIV/STD services). Our WIC services provides nutrition, food commodities and healthy menus training to 25,000 women and children under 5 years of age in 8 counties. The quality assurance for confidentiality, HIPPA and the accounting practices for all our programs but especially for WIC and Title V, is comprehensive, meticulous and get routine reviews from the city’s internal and external auditors and by DSHS or HHSC program staff. Systems and program is reviewed through programs on daily levels for exit and clinical care SOP compliance, monthly for performance measures and contractual compliance using data analysis, encounter reviews, billing reviews and programs reports, quality assurance is reviewed quarterly for program, performance measures and quality care compliance and develops corrective action plans that are reviewed by the different committees (medical, peer, nursing, infection control, human resources, billing and contractual and customer service). Other large programs that also require extensive review, performance measures accounting are the Immunizations, HIV, Public Health Preparedness, newly funded SAMSHA has extensive data gathering and accounting and as well our city general funded programs.

RFP No. 529-16-131641

1.3 Identify and describe the Respondent's and its subcontractor's proposed labor skillset and attach resumes of all proposed key personnel (as defined by the Respondent). Resumes must demonstrate experience germane to the positions proposed. Attach an organizational

chart for Respondent and proposed Subcontractors.

Include this information as an appendix in Section 4 of your proposal.

1.3 Response Space: no subcontracts, resumes and organizational chart are attached.

1.4 Describe the Respondent's ability to collect and manage data for large projects. Describe quality control procedures that have or will be utilized to ensure complete, accurate, and timely data entry. If Respondent intends to subcontract any portion of services, include ability descriptions for each proposed subcontractor.

1.4 Response Space: CLHD NFP already exists with a supevisor and 5 excellent and dedicated NHV’s who have surpasped all goals reaching 170 moms vs. 100 and 123 babies as well we surpassed the breastfeeding gold (81%) reaching 85.6%. As to data collection besides the CLHD curent data systems support, and software program (insight) that serves as our EHR and reporting system, NFP collects data in each benchmark from each participant. Data is also collected on demographics of the client and index child, use of the program (number of visits, duration of sessions, etc.), language and socioeconomic indicators as directed by NFP guidelines and protocols. In addition CLHD NFP collects data to monitor fidelity to the model including caseload, home visitor characteristics and supervision. Data is further collected on each client and a variety of reports are available on demand at the agency level. Data and reports are analyzed by staff, adminstratiors and the Nurse Consultants and Regional Quality Coordinators on a regular basis and the results are used for quality improvement activities. Once data is collected by the NFP Nurse Home Visitor (NHV) and entered directly into the national NFP web-based information system (Efforts-to-Outcomes™). Outcomes are reported directly to each implementing agency and on-demand reports can be created by each agency. Assessment data are collected primarily through interviews, self-reporting and self-administered scales such as the Edinburgh Postnatal Depression Scale. Training on the reporting system is provided to nurse home visitors, supervisors, data assistants and administrators through online modules, manuals, webinars and in-person nursing education. Technical assistance is continuously available through NFP Information Technology and Program Quality. Quarterly reports are also done with cumulative data on client characteristics, process and outcome results related to pregnancy, child health and development and maternal life course. NFP uses four tools that have psychometric validity and reliability: the Ages and Stages Questionnaire, the Edinburgh Postnatal Depression Scale, the Patient Health Questionnaire-9 (PHQ-9), and the Home Observation and Measurement of the Environment (HOME) Inventory. Initial client data collected was tested formatively to assure clarity of interpretation by the client and NHV, and connection to the constructs being assessed. Once data is recived NFP Quality and Information Technology staff monitor data quality and data security through a formal process and provide feedback and reports with profiel and demographics data as well on performance measures. For data safety and monitoring, NFP utilizes a software platform into which only designated, NFP-approved persons may enter data collected about clients and the Program and obtain reports for managing and evaluating Program implementation and results. The web-based information system is secured against unauthorized use by VeriSign® 128-bit Security Encryption, the industry standard in Internet site protection. Authorized access to the database and website can only be provided by NFP. NFP complies with the rules and regulations concerning the privacy and security of protected health information (PHI) under HIPAA and the HiTech Act as if it were a Covered Entity, as defined by those regulations. NFP enters into HIPAA Business Associate Agreements to ensure all its implementing agencies, vendors and agents agree to the same restrictions. NFP protects against non-permitted use or disclosure of PHI using no less than a reasonable amount of care and will promptly report any non-compliance of which we become aware. In additiion to the NFP data colections, analysis and reportiong the CLHD has it own data system and QIP that compliments the NFP project for inhouse and program

RFP No. 529-16-131641

suport data analysis, data gathering and reporting as well to revise and imporve services, Our system is a netsmart insgith software that slo servges as our EHR. Our data system also links with the DSHS, CDC and SAMSHA immunization, TB, primarycare, HIV/STD, WIC and Diabetes systems that also have extensive dedicated reporting requriements.

1.5 Provide evidence of financial stability sufficient to support the requirements of this procurement and any resulting contract. Personal Financial Statements will not be considered in lieu of financial statements of applicant Corporations, Partnerships, or LLC's. Respondents must submit the following:

a) Current financial statement; b) Most recent two (2) years of audited financial reports which shall include:

i. balance sheet ii. statement of income and expense iii. statement of changes in financial position iv. cash flows v. capital expenditures; and

c) Notes to the financial statements.

Include this information as an appendix in Section 4 of your proposal-included as attachment.

1.6 Has the Respondent had an application or award terminated for cause within the last 5 years? If yes, please describe the category of application or award and identify the granting organization. Enter the award title, award number, award amount, and the reason for termination.

1.6 Response Space: Not applicable, since there has been no terminations of awards or

applications in the past.

1.7 If Respondent intends to subcontract any portion of this project, please describe how you will monitor subcontractors.

1.7 Response Space: Not applicable, this organization will not subcontract.

1.8 Describe your experience administering the NFP model or a similar program in your community. Describe two program successes and how they were achieved. Describe two program challenges and how they were resolved.

1.8 Response Space: Laredo has a long history in conducting several models of home visiting and community outreach by Promotores (lay health workers) case managers, nurses and home health. Every model proved to be an assest in helping us further create awareness and educaion on health care and prevention, disease control and DSM. Some models we have conducted provided actual care, acute and shorterm therapy. Most assisted in helping us further determine our readiness to understand our health care needs, which helped us better plan, prepare and develop response efforts to adress our health care needs in particular women and children's health care, social, human servies and educational needs. This experience and history prepared us for the nurse home visiting NFP current program we have conducted for the last 4 years. In addition all our moms were provided with not only health and medical care support but as well educational, workforce, parenting, behavioral health and leadership. Babies were all supported with healthcare, social, growth and development suport. The proejct will continue to be lead by Supervisor Rocio Lona BSN, under the guidance of Dr. Waldo Lopez Associate Director with 40 years in public health and healtcare, Michelle Gonzalez WNP with over 25 years in nuring and womens health and the Director Health Dr. Hector F. Gonzalez with over 35 years in health care, prevention and public health. In addition to the training on the NHV program all services and programs at the CLHD served as a network for additional support to our NFP team. The NFP team in particular provided care to date to over 170 women and is following 123 babies for their well health, growth and development as well to assure any entitlement and special services was provided if neded. NFP has played a major role in the lives of our patients most between the ages of 14-23 and

RFP No. 529-16-131641

all needing case management and socail services support and as important guidance on leadership and acheivement. We built into our home visitng program understanding their future was important not just for them but for their child, we have succes stories of many continuing their education (one went to nursing school), most finshed school and graduated, others got workforce skills and started working. All were provided guidance on child raising and parenting as well to look for signs of positive healthy growth and development. Some children had health and disability issues that were immediaelty addressed with a referral and guidance to the appropriate medical home or support agency. Some of the mothers also had either educaional or behavioral health needs that were also adressed with the appropriate educational, workforce or social services support agency, one had severe emotional problems that is under care of an appropriate licesned professional counselor and clinician. This was all caught through the best practices of the nurse home visitation services and by our community's readiness to address, prioritize, plan and evalaute our needs and through appropriate leadership to implement sustain and satbilize efforts to improve the quaity of iife for every Laredoan. There have been no major challenges other than during the start-up in hiring a BSN’s but in working with the nursing school and the NSO we were allowe dthat if No quaifed and timely BSN applied we woucl hire an ASO. In addition the need is greater and we requested aditional staff and were grated a 5

th NHV.

1.9 Describe your agency's experience building to and maintaining program capacity over time for the NFP model or a similar program in your community.

1.9 Response Space: The CLHD has been conducting the NFP model and program for almost 4 years very sucessfully. Therefore our methodology and strageies alreaedy in palce for NFP nurse hiome visitation will continue. Our early intervention for new low income first time moms, thus reducing still births, pre-term births, congenital birth defects, neural tube defects, and reduce prematurity and its complication through ealry and sustained prenatal care. Nutrition is also provied both for mom and child and we have had a great succeess with promotoing breastfeeding. STD/HIV and behavioral health are also riks factors that we provide ealry intervention and NFP is an integral part of this effort. Teen pregnancy also contiues to be an issue with 590 teens (18 years of age and under) being pregnant. The CLHD and local school are partnering to enhance sex education, abstinance and familiy planning to help reduce adolescent pregnancy and promote positive reinforement however if opregnant NFP plays a vital role for thse young women and assures a contimun of care and through postpartuam provides a network of support that guides these young owmen into a postive future. We want to continue to make a diffence in preparing young adolescents and first time moms, to contiue their educaion, be part of a productive workforce and maintian their health, we strive to make a difference as 38% of females who have a child before age 18 receive a diploma by age 22, 30% of the teens who drop out of high school cite pregnancy as the reason, 67% of teens moms who have moved out of theirs families households live below the poverty level, 63% of teen moms receive some type of public benefits within the first year after their children were born, less than 25% of teen moms receive any kind of child support payments, children less than 8 years old born to teen mothers scored significantly worse on math and reading tests, and teen births in the county of Webb costs tax payers over $22 million per year.Finally through NFP and our womens health services we are assuring that young women have healthier outcomes as our 25 year old and yonger pregnant mom are being found to be high risk with hypertension, gestational diabetes, STDs, and we have seen an increase in prematurity which all are being targeetd to reduce adverse health effiects.

1.10 Describe any performance improvement plans or corrective action plans in the past 5 years administering programs and how they were addressed.

1.10 Response Space: There has been no major corrective action plan other than routine improvement and revisions for quality care improvement throughout internal QIP process (PRC/Personal Action Committee). The PRC meets quarterly to address keys actions in several standing committees (infection control, peer nursing, safety, customer service and credentialing, and medical review). These committee

RFP No. 529-16-131641

review systems protocols, SDOs, program requirements care services, and patient feedback as well the medical reviews all patient care services. Once feedback and or program reviews are done and corrective actions developed these are implemented and reassessed for continuous quality improvement. In general our main challenge for program and service delivery improvement is assuring early access to care for the uninsured, underinsured, adolescents and high risks individuals. We have strived to assure the continuum of care and early access using all community based and evidenced activities. Toward that end the CLHD, LHC and several public and private provider partners have the collaboration and development of an enhanced network to assure multiple access points of entry into healthcare. Special events in coordination and collaboration with the LHC, Hospitals, providers, schools nonprofits and state and local agencies and partners have improved standards and prioritized needed care services. Together corrective action plans, strategic action plans and enhanced delivery of care have been implemented. Some of these actions are Operation Lone Star that provides general exams and medical care to over 5000 persons a year, Doctors of Mercy that come twice a year and provide primary care services to over 1000 persons. In addition the are several screening and early detection services done by the LHC, CLHD, hospitals, MHCM, and the local FQHC to serve as an enty point of early detection. In additiion the CLHD provides Title V Maternity, Well Child, Primary Care and Dental care; WIC, Immunization, HIV/STD and Familiy Planning targeting at-risk women, children, families and adolescents that are uninsured, medically indigent and/or high risk to enhance prevention and early detection. Thes are all reviwed and asessed by the PRC, state and provider to ensure quaity imporvement and corective actions done if needed. Low-Income Families continue to be targeted through all our programs and services, in particular for maternal and child health, dental, WIC, Primary Care, Immunizations, Nutrition, STD and HIV Services. Targeting those most at risk for early access through outreach, health education, routine screening services (Buena Vida), case management and disese self management/DSM (healthy living/viviendo mejor) are the foundation to the continuum of care. Through the LHC and other public and private partners we strive to fill the gap for health care delivery but not just with prevention and primary care services but with allied health services equally as important: DSM, ACA, Community Partners and Medicaid enrollment both in community forums and onsite at the CLHD. All our educational information, access systems, staffiing and outreach is bilingual and bicultural to assure we reach those most at risk (primariliy spanish since 95% of the population is Mexican American/Latino) and id designed to get to those most vulnerable and hard to reach. Special efforts to reach the most at risk are women and chidlren, especially young owmen for maternal chidlhealth services (first time mothers in particular) and those at risk of HIV, TB, STD, Adolescent Pregnancy, Child Neglect and obesity. We also have avenues for special needs, brail and sign language as well we contract with an online phone language assistance program for Asian languages. Finally to further bridge the gap for health care delviery and imporve perfocmen to acces and prevention we have formed strong partnerships with the schools for school health services (immunizations, obestiy, adolescent health), for NFP, enlarged the CAB (for health care, NHV improvement, at risk MCH access and DSM) and integrated DSM and behavioral health (BH). Both DSM and BH were request from the LHC, community artners and CQIP to adress improved performance. Toward working on sustainment we have proposals and netwroks enhancement with Astro Zeneca using innovative technology for hypertension management, Texas Campaign for an adolescent pregnancy prevention evidecned based curriculum in schools and with local managed care organizations.

Section 2 - Project Work Plan

2.1 Provide a letter from the Nurse Family Partnership National Service Office (NFPNSO) supporting continuation of current services and/or development of new services as required by section 2.2.1 of this RFP. Include this information as an appendix in Section 4 of your proposal- attached

2.2 Indicate your community's current level of readiness to develop/implement the NFP program.

2.2 Response Space: Laredo has a long history in conducting several models of home visiting and community outreach by Promotores (lay health workers), case managers, nurses, health educators and epidemiologist. Every model proved to be an assest in helping us further create awareness, education on health care and prevention, disease control, early detection and disease self management (DSM). Some models we have conducted provided actual care, acute and short term therapy. In addition we have conducted the NFP model for almost 4 years and excelled in reaching our goals. All our HV services have assisted in helping us further determine our readiness to provide comprehensive outreach and case management efforts to reach the most vulnerable, high risk and low income families and in particular women and children's health care, social, human services and educational needs. This

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experience, history and already conducting the NFP NHV program has prepared us to continue to conduct the NFP NHV current program. In addition to the training on the NHV program all services and programs at the CLHD serve as a network for additional support to our NFP team. The NFP team in particular provided care to date to over 170 women and is following 123 babies for their mom and baby well health, growth and development as well to assure any entitlement and special services needed. NFP has played a major role in the lives of our patients most between the ages of 14-23 and all needing case management and social services support and as important guidance on leadership and acheivement. In addition to the CLHD readiness to conduct the NHV the city and community has embraced outreach and HV for a number of services not just in health. For education, workforce development, emergency response CLHD plays a vital roll in reachng all persons. For our NFP we made sure to integrate well health, self esteem and mom’s understanding that wellnessis important for her future but as important for her child. To that extent we have enlarged our CAB and it has always been an integrated network into the larger Laredo health Coalition (LHC) to assure the communiyt is ready to assit maternal childhealth services. We also have built a relationship with the local managed Care Providers (Molina, Superior and Driscoll Health Care) to ensure thse chidlren and moms have every opportunity for entillment servicees and stay in care. They are also partners for incentives for our NFP families. Social service agencys are also intergated into our network as well schools (parenting education program) as they are intimate partners to assure well health, their education, and skills development but as well any state suported services that maybe needed. Child headtarts, daycares and chidl advicacy cneter are also parrt of the network to assure a safe, loving and protective environment for quality child growth and developoment. All NFP participants are also provided guidance on child raising and parenting to further develop skills necessary for mom and bys postive outcomes.

2.3 Describe your plan for complying with training, reporting, home visiting, client, and staff requirements specified in Section 2.2.24 of the RFP.

2.3 Response Space: Our plan includes continuing with the most qualified Nurses and support staff and to fill any vacancies, our 4 member and supervisor team have already done an excellent job surpassing our performance goals. In addition our staff are dedicated to Assurant healthier birth outcomes and comprehensive support for mom and baby through the first two years of life. History and the NFP program have shown that early intervention with first time high moms assures a healthy mom, her birth and a healthier child’s growth, development and wellness. All our nurses have been trained by the NSO and HHSC approved NHV standards for HV and as well are under the guidance of the Supervisor who has received extensive NHV training by the NSO, NFP, HHSC and has 15 years in nursing care. NHVs conduct home visitation daily who also have received their NS) and HHSC continuation training and as well the nurse supervisor visits with the NHV weekly to observe practices and recommend improvements and provide her guidance as the most senior trained NHV. The NFP staff has frequent telephonic, in persons and formal training meetings with the THHSC NFP nurse consultant, as well as with the NSO nurse consultant. The THHSC administrator also holds meetings as needed with the local NFP administrator. Locally the CLHD has also served as an anchor for additional preventive care, social support services, child development and women’s health training and staff has also adopted as a best practice additional training in prevention, women’s health, child health (immunizations, growth and development milestones achievement) and have become lactation specialist, gotten additional training in mental health, substance abuse, and child protective services trainings. Training records are kept at the NFP administrative office. The “ETO” system of reporting progress is maintained daily and needed data is extracted for formulating necessary reports. The ultimate goal is to assure reaching the maximum number of clients with the best possible care so we can service the most first time low income pregnant moms, their child, and family, to reduce the teen pregnancy rates, low birth weight, premature birth, still birth, infant death and STDs (like syphilis & HIV). For our community we are also sure to prevent TB, control diabetes, prevent breast & cervical cancer, child & mom dental issues, and improve women’s health as well assure a healthy start for baby and his continued positive growth and development. Todate our staff have complied with all reporting requirements of the NSO, HHSC and the NFP program and will continue to do so

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by assuring a constant and close communication with the administration and program consultants for continued training, technical support and program analysis to revise and improve our Quality management of participants and to assure meeting our goals. Finally to assure QIP the data entry clerk also receives local data entry/clerk training with the City of Laredo as well, when it attends the yearly annual conference with the THHSC.

2.4 Discuss whether then Respondent intends to develop a new NFP program, sustain an existing program, or expand an existing program. Define the geographic area proposed to be served including the specific area of focus (zip code, county, multi-county, etc.) Discuss the demonstrated need for NFP in your community. Supporting data may include the poverty rate, perinatal outcomes, incidence of child abuse and neglect, crime rate, the number of births to Medicaid recipients, and the need to enhance school readiness in the community. Please include data on preterm births, low birth weight infants, and teen pregnancy.

2.4 Response Space: We want to continue with our curent NFP project as permitted by available manpower, and resources. Our present structure includes three NHV, one nurse supervisor, and one office data clerk. Based on the need suported by 35% locally of teen pregnancies drop out of school, over 60% of local pregnant teens move out of their families households and live below the poverty level, locally 65% of teen moms receive some type of public benefits within the first year after their children were born. We also have a sever un insured rate (40%), and we are a medically underserved area and a health profession shortage area designated by DSHS and HRSA. Of the 6,138 births in 2014 33% were born to low income women. Number of CHIP and Medicaid enrolled families is 38% of the population and in 2014 we had 590 18 year old and younger pregnant in our school programs. While we don’t have a clear rate for prematurity our perinatal death rate is 8.1 and last year we had 13 deaths due to prematurity (the most ever); our infant mortality rates is 4.6 and our low birth rate is 6.2. A concern for moms is high risk pregnancies especially with high rates of hypertension and gestational diabetes in women under 25 years of age (stats are from our Title V clinic) The experience and history with our NFP project over the last 4 years has also shown with our NHV support and education some of our NFP moms who got good prenatal care, good nutrition and good support we had 6 premature babies born healthy. Yet some of our moms also had challenges (substance abuse, neglect, abuse, disassociated with family) needed behavioral health interventions. If our staff had not been there a tragedy could have occurred. That is why we need to continue and increase NFP services. To further assure we are rechinig those most at risk and in need we will contiue to target those areas of Laredo with higher rates of poverty, medicaid and uninsured (zip codes 78040, 041,045 and 046). Most of our participants were between the ages of 14-23 and all needing case management and social services support, guidance on leadership, acheivement, self esteem, which helped them understand their future was important not just for them but for their child. We have succes stories of many continuing their education (one went to nursing school), most finshed school and graduated, others got workforce skills and started working. All were provided guidance on child raising and parenting as well to look for signs of positive healthy growth and development. Some children had health and disability issues that were immediaelty addressed with a referral and guidance to the appropriate medical home or support agency.

2.5 Describe the client population served by the proposed NFP program including specific high-risk groups such as teens, refugees, military families, substance-abusing mothers, cognitively or physically impaired mothers, and mothers with mental health diagnoses.

2.5 Response Space: The continued NFP home visitation will continue to provide early intervention for new low income first time moms, thus reducing still births, pre-term births, congenital birth defects, neural tube defects, and reduce prematurity and its complication through ealry and sustained prenatal care. Nutrition is also provied both for mom and child and we have had a great succeess with promotoing breastfeeding. STD/HIV and behavioral health are also riks factors that we provide ealry intervention and NFP is an integral part of this effort. Teen pregnancy also contiues to be an issue with 600 under 18 pregnancies a year. The CLHD and local school are partnering to enhance sex education, abstinance and familiy planning to help reduce adolescent pregnancy and promote positive reinforement however if opregnant NFP plays a vital role for thse young women and assures a contimun of care and through postpartuam provides a network of support that guides these young owmen

RFP No. 529-16-131641

into a postive future. We want to continue to make a diffence in preparing young adolescents and first time moms, to contiue their educaion, be part of a productive workforce and maintian their health, we strive to make a difference as 38% of females who have a child before age 18 receive a diploma by age 22, 30% of the teens who drop out of high school cite pregnancy as the reason, 67% of teens moms who have moved out of theirs families households live below the poverty level, 63% of teen moms receive some type of public benefits within the first year after their children were born, less than 25% of teen moms receive any kind of child support payments, children less than 8 years old born to teen mothers scored significantly worse on math and reading tests, and teen births in the county of Webb costs tax payers over $22 million per year.Finally through NFP and our womens health services we are assuring that young women have healthier outcomes as our 25 year old and yonger pregnant mom are being found to be high risk with hypertension, gestational diabetes, STDs, and we have seen an increase in prematurity which all are being targeetd to reduce adverse health effects.

2.6 Describe existing services in your community that are available to first-time, low- income pregnant women and their families.

2.6 Response Space: There are a number of services available to first time low income moms and their families in our community. Many are provided through the CLHD through women’s health services, family planning, HIV/STD, maternity, primary care, early detection, dental, WIC (nutrition, breastfeeding and wellness), well child, immunizations, case management, health education, disease self management and SNAP, Medicaid, CHIP and ACA enrollment. In addition health care during pregnancy and well child is also offered to low income women at the FQHC, Sisters of Mercy Clinic, Methodist Health Care, BCFS and Medicaid Physicians. Support for social services. Education and workforce development as well Behavioral health is provided by social services agencies and state programs such as SCAN, Border Region Behavioral Health (BRBH), Food Bank, Salvation Army, Ventanillas de Salud-Mexican Consulate, TAMIU Outreach program, Healthy Texas Babies, March of Dimes, Children’s Advocacy Center, Casa Misericordia (shelter for women), DARS, HHSC, DSHS, CPS, TXDOT (car safety). Early Head start, Migrant Services, Bethany house, both ISDs and South Texas Development Council, Pillar, as well a number of community centers and parks that offer skills development, social services, food pantries. SCAN and BRBH have increasingly become a priority services for outreach on mental health, peer support, suicide prevention and BH disorders. Our NFP program has also made important contributions to assure that 170 first time moms and 123 children were also case managed to assure healthy birth outcomes and healthier moms. Through our efforts we provided early detection of several complicated issues with BH, nutrition, education, post partum care, well baby and through our actions more positive outcomes were achieved and more appropriate care. Finally our physicians and hospitals, neonatal units, maternity services, well baby and pediatric offices offer quality care and support.

2.7 Based upon your proposed target population and the eligibility requirements for the NFP program, what data indicates that there are enough families eligible for services in your service area to maintain your program? (i.e. first time, low-income mothers)

2.7 Response Space: Uninsured rate (40%), total births in 2014 - 6,138. Of these births born to low income women

(33%), number of CHIP and Medicaid enrolled families (38%), teen pregnancy 590 18 years

and younger in 2014 based on birth certificates;

2.8 Considering the number of eligible families in your proposed community and the voluntary nature of services, what do you consider the ideal number of NFP slots if all families who wished to participate could be served. This number may or may not match the number you are proposing to serve.

2.8 Response Space: 200

2.9 What is the projected number of families that you anticipate being able to

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serve with your proposed project?

2.9 Number of families: With three (3) NHV, and one nurse supervisor, we project to service 88 families.

2.10 Provide the projected cost per family when the program is operating at 85 percent capacity. Describe your methodology.

2.10 Response Space: Currently projected costs per family is $2,240 if the program operates at 85% the cost is $2476

2.11 Describe the availability of qualified nurses in your area? How do you plan to recruit and retain qualified nurses to the program during the proposed contract period?

2.11 Response Space: After the initial start-up we hired a 4 NHV team and a supervisor who are doing an excellent job. Very recently one NHV moved out of town and our Supervisor retired. Therefore, we will have to hire two nurses. While the pool of nurses is competitive, the nursing school at Texas & AM International (TAMIU) serves as a recruitment pipeline and we tend to lure nurses from the hospital because of our work schedule. Recruitment is also done through the city municipal network and all positions are advertised throughout the state and nationally. We also recruit through DSHS which helps target nurses regionally. To retain nurses we provide incentives that includes a yearly COLA, over 12 paid holidays year, the ability to gain sick leave, medical insurance (BCBST), workers comp, and a competitive retirement (TMRS) and we support their CEUS and liability insurance, the city pays very good benefits. To further improve we are starting a citywide review of all positions for increased benefits and pay scale, the nurses are priority positions being evaluated to become more competitive with the private sector and for retention and recruitment improvement.

2.12 Describe how you envision integrating and collaborating with other existing services in the community that serve low-income pregnant women and their families, including other home visiting programs if available.

2.12 Response Space: Within the CLHD services coordinate intimately with NFP to assure all services are available to mom and child. These include: WIC, family planning, primary care, immunizations, maternity, well child and dental clinics for women and children, immunizations, chronic disease primary care and disease self management, infectious disease services, laboratory services, HIV/STD services, cancer screening, nutrition, mental health services, behaviroal health and substance abuse prevention and counsellingSNAP, TANF, social services/case management. The NFP supervisor assures coorindation with NFP for services, recrutiment and referrals. We also have a strong relationship with HHSC, DSHS, Border Region Behavioral Health, faith based social and health services (Mercy, Methodists and Baptist Health Care Ministeries), Early Childhood education, headstart, womens commission, SCAN, PILLAR, and ECI for suport services for women and children. Through CAB members in particualr ogh These serve as additional social services, educational, training and workfroce development services that target low income families and assist NFP participants. Physicans who provide care for Medicaid and CHIP families also form part of our NFP network for health care and for refferrals. Through the CAB we also built a subcommittee targeting children's health, education, growth and development. The early childhood and headstart representatives, migrant health, children's advocacy center, daycare

RFP No. 529-16-131641

representatives, HHSC Medicaid and child protective services, both school districts, BCFS that concentrates on neonatal and maternal child health services.. In addition the CLHD offers all are part of our network to assure social, educational and health care services. The CLHD programs also play an important role in assuring care for low income and uninsured persons. (Immunization services, current NFP, WIC summer camps, obesity school health interventions, well child and medical case management services and WIC nutrition and breastfeeding services and dental health). When an NRP family needsa any service provided by the CLHD or partners they are immeidaley connected to thses. We have also linked to Bethany House a safe haeven for children as well the Childrens Advocacy Center, Ruth B. Cowl Rehabilitation Center, Kwanis and Rotary all serve as part of our children's network for services, refferals, fund raising and children's advocacy and protection. The director of health sit n the child fatality review team that assues we hihglight any preventive health care issues and promotes child protection and wellness. A local philantropists from the Fernando Salinas Trust is also a resource for women and chidlren's services in particualr health and education. Through the CAB abd LHC we also link to the servies and programs offerd by the state HHSC, DSHS, DARS, TXDOT and the mental health authority (BRBH) whom we also partner with for services, entitlement and refferals. In addition to assure entitlement services for children and mothers we have certified counselors for both ACA and Medicaid (community partners). Recently we have started a collaboration with the early childhood program from Texas A&M International University, parenting skills development services and enhance the relationship with the medicaid managed care programs (Molina, Superior and Driscoll Health Care) for improved recuriment and entitlement into Medicaid. Finally we contiue our relationship with the Colonias Texas AM Promotoras program that prpvide outreach and home visitation to very at risk families, BCFS HV and Mercy Health Care Ministries HV services.

2.13 Based upon the requirements stated in Section 2.2.24.6 of the RFP, what stakeholder groups and community representatives do you seek to engage on your NFP Community Advisory Board (CAB)? Provide a list of potential CAB membership for the FY16 fiscal year including the following information for each member: name, title and affiliation/organization. Include this information as an appendix in Section 4 of your proposal. List is attached.

2.14 How will you use your CAB to develop and maintain broad-based community support for the program?

2.14 Response Space: The CAB is composed of a diverse set of stakeholders from schools, HHSC, WIC, Immunizations, Baptist Health Care and Methodist Health Care Ministeries. These agencies have assisted in developing stronger partnerships to educate new moms, plan pregnancies and to recruit and enroll in NFP. In addition the CAB and other partners like the LHC and the Mayors Active Living Task Force all srive to imporve the quaity of life and leverage resources to accomplish healthier outcomes. In particular, the city has made two health priorities: MCH services and Obesity Reduction. Therefore, the Cab has been an extension on this target to improve MCH that includes NFP. At the current time, the CAB plays a vital role to support NFP with refferals, recrutiment, and allied health and social servies for NFP moms and their chidlren in particular

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the school partners, CLHD WIC and Immnuizations, already provide adequate refferals, but in further enhancing recruitment and assuring a wider pool of poetntial persons for the NFP program we provide information packets to doctors offices and make presentations to their staff on the NFP model. At HHSC offices staff and CAB members provide information packets for all persons who are seek any entitlement services on NFP and CLHD prevention information. The CAB also has early childhood and headstart representatives, migrant health, children's advocacy center, daycare representatives, HHSC Medicaid and child protective services, both school districts, BCFS that concentrates on neonatal and maternal child health services. All of these groups provide guidance and services for children's needs, healthcare, education and social services support and they also serve as a network for services and referrals. Most currently and they are new CAB members the Methodist Health Care Ministery (MHM), Molina, Driscoll and Superior Medicaid Managed Care Carriers are assitiing with incentives for NFP moms and their children. These networks also join us in promoting healthier behavior, eaaly detection and wellness services, DSM, nutrition and the continum of care.

2.15 Describe relationships you have with local community leaders that will help leverage financial resources and build community readiness and ownership.

2.15 Response Space: CLHD and all its programs are under city governance and recieve support wholeheartily from our Mayor, City Council and City Managament and they already support inkind and financial resources for direct medical, preventive, prental care, womens health, primary care dental care and ealry detection services. Case management, social services, nutrition, disease self management, mediciad and other entillment services are already provided that compliment clients in the NFP program. State services from Title V and Title X are also provided as many NFP moms are uninsured and while pregnant recive Mediciad or CHIP preinatal services, once baby is born, the child emians on Mediciad especially our adolescent moms (majority of pur NFP clients are 14-23 years of age). In addition other comprehensive health care and wellness services are provided through our local resources. Additional recources and support for actions to better be prepaerd to adress health care, human services, education, housing and workforce development is the committment from city to further invest in econimic development projects that build on re-development of old and new neigborhoods (water infrastructure, museum in downtown, school and prviate sector bond driven

projects as mentioned already), have a master plan for downtown development which have strong relationships with the private sector (new outlet mall) and the chamber of commerce, but as well with local philantropist (Fernando Salinas Trust and the DD Hachar Trust) whose financial resources are dedicated for health, human services and education. These are some of the foundations to further build on rto further creat community readiness and leveage financial resources. Yet because our population is up to 40% uninsured and we are a health professions shortage area and a medically

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underserved aeras NFP resources are needed at the curent time in its entirelty. The CLHD has made strides to compliment for many activities and servives not covered by NFP and will continue (car seats, baby cribs, transportation support, self esteem incentives) and early detection services. In addition moms who don’t quaify for NFP or other MCH services and are uninsured are seen through our network of providers and through the CLHD already, allof these are propvides some kind of outreach and home visitation if needed.

2.16 Please attach a timeline for service delivery including implementation of all proposed existing or new services. Include this information as an appendix in Section 4 of your proposal. Attached

2.17 Discuss the strategies you will employ to maintain service delivery at 85 percent of funded capacity or higher throughout contract period. Responses may include a discussion of marketing, recruitment and referral strategies, staff and client retention strategies, and caseload management strategies.

2.17 Response Space: We have successfully been conducting the nurse home visitor program using the NFP model for the last 4 years. With the projected adjusted budget, we will be able to continue with three (3) NHV, and one nurse supervisor. Our network for referrals and recruitment is well developed getting participants from doctors offices (daily we get referrals), the health department Maternity, WIC, Primary Care (La Familia), Family Planning, Immunizations and HIV-STD clinics. The schools especially play an important role in education, recruitment and referrals and it committed to through a formal MOU with the Laredo Independent School District and United Independent School District for recruitment and referrals within our target population. Our partners (Sisters of Mercy, Gateway Community Health Center, Doctor’s Hospital of Laredo, Laredo Medical Center, Webb County Indigent, School Districts, MHMR, CHIP, and Medicaid office, Methodist Health Care Ministry and the Health Coalition assist with information sharing, forming a Commuity network on maternal child health services improvement, NFP recruitment and addressing long term sustainment. Our WIC program in particular and our women’s health services (Title V, Title X, ACA, CHIP) provide care to over 25,000 women and children in Laredo and are a direct referral for enrollment. NFP staff work with WIC staff not just for recruitment, but for assurance of services, breast feeding support, nutrition, education and wellness. Non- qualifying applicants to the NFP program will be referred to the CLHD system and/or to our partners such as Gateway Community Health Center, Mercy Ministries, Healthy Start, SCAN, Methodist Health Care Ministry and Baptist Health Care Ministry to ensure service and care. Through this effort we target all at risk and low income women for prevention, women’s preventive health prenatal care and NFP services. In addition we also identify NFP participants most in need and vulnerable by their risks, age and income category using TANF, Medicaid, CHIP, and WIC Program eligibility criteria and referrals. In this manner we target the special vulnerable and at risk

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populations and work to encourage women to obtain early prenatal care, postpartum care and well child and prevention services for their children especially for those most at risk. Working with the LHC, Schools (parenting education program), Head Start and daycares, we are also targeting those most vulnerable first time mothers and children at risk. We also used zip-code and census tract data to identify at risk low income populations that lack access to care as well those areas with the highest rate of pregnancy. In order to recruit our target population that may be difficult to reach, the CLHD network of partners (schools, state agencies, county and city social services, non-profit social service groups, food bank, Medicaid office and our Medicaid enrollment staff, universities, workforce, migrant services, head start, and rotary, serve to enhance the safety net for referrals and recruitment of patients. Most importantly we already have a captive population within our own MCH, WIC and early detection services that we can recruit from. We have experience with servicing rural areas such as the “colonias,” with “promotores,” to ensure enrollment of women in hard to reach areas. Finally, as stated above our current recruitment efforts have developed an additional network from the private physicians who are referring to us daily.

2.18 What challenges do you foresee in implementing the NFP model in your community and how will you address these challenges?

2.18 Response Space: We don’t foresee any major challenges, as we have implemented the model over 4 years very successfully. Our current supervisor did a great job but retired and will have to recruit to fill. We do feel however, that one of the current nurse home visitors will do a great job as the supervisor. Hiring BSN in Laredo is a small challenge, as we don’t have a large pool of BSNs, however, we were finally approved that if no BSN applied and a good ASN did we could hire. We have an excellent relationship with the local nursing BSN program at Texas A&M International, Dr. Gonzalez is on the nursing school advisory board and we have established a network to recruit from the school and don’t see a problem. We are competitive in pay $25/hr and are basically an 8-5 job, M-F with benefits. As to performance measures we surpassed our goal of a caseload of 100 first time moms and ended our 4 year project year with 170 first time mothers and 123 children. Care wise, many of our participants are 14-23 years of age which created issues of social psycho support, a few with serious behavioral health needs and substance abuse but some of these participants are at risk moms that are targeted to assure healthy outcomes and healthier birth outcomes. In Laredo, the need

RFP No. 529-16-131641

with teen pregnancy (570 18 and under in 2014), and the majority of moms under 25 support the need for NFP services. Finally, many of our moms need a lot of support toward non dependence and on others, autonomy and as well good education and workforce development which NFP help support.

2.19 Using the table below, please indicate the current local investment in home visiting services and services for low-income pregnant women and their families and the amount that could be reasonably leveraged in the future for NFP for each of the listed sources

2.19 Funding Source Current Investment Potential Investment

City Government $ 10,000 $10,000

County Government 0 0

Private Foundations $2,000 $2,500

Corporations $500 $500

Local Businesses $500 $500

Individual Donors 0 $500

Other (Please List): 0 $10,000

2.20 Describe your methodology for projecting potential investment in your community. What knowledge and experience leads you to believe that your investment projections are community-specific and realistic?

2.20 Response Space: The amount is based on current investment from different sources for support that the CLHD has built: city in-kind, local philanthropist (Fernando Salinas Trust), local businesses that provide food and incentives for NFP participants and their children for activities not presently covered for NFP support. Based on our relationship to support uninsured, adolescents and maternal child services this support will continue but the city in-kind will be more crucial in the future for sustainability and/or funding reductions. The city general fund already provides $85,000 of the general fund for maternal child health services that includes prenatal and postpartum care, case management and home visitation by Promotoras and that will continue. Dental care for both women and children are also supported by Title V and the University of Texas health Science Center San Antonio Dental School. Through our 1115 waiver some funds $10,000 can go to home nurse visiting services for first time mothers.

2.21 What is your plan for raising the funds to support the minimum 10 percent cash match for NFP during the period from September 1, 2015 to August 31, 2016?

2.21 Response Space: The 10% cash match will be covered and recorded on its own cost center with personnel for Waldo Lopez to provide administrative and program support.

2.22 What dollar amount and percentage of the total implementation costs do you think you could effectively leverage during year five of the project?

2.22 Response Space: $4,000 for allied support to assist with NFP activities not covered by grant funds and $20,000 for home visitation and case management support.

RFP No. 529-16-131641

Section 3 - Value-Added Benefits

3.1 Describe any services or deliverables that are not required by the RFP that the Respondent and/or Subcontractor proposes to provide at no additional cost to HHSC. Respondents and/or Subcontractors are not required to propose value-added benefits, but inclusion of such benefits may result in a more favorable evaluation.

3.1 Response Space: The CLHD provides services in-house for prenatal care, nutrition education and assessment, postpartum care, primary care, immunizations, HIV/STD and familiy planning services, laboratory services, epidemiology services, dental services, STD/HIV services, TB clinic, diabetes care, women’s health care, disease self management and dental care that is available to all NFP participants at no cost. We also screen and qualify them for WIC, Mediciad, CHIP, SNAP and ACA onsite. Through our case managers and Licensed Professional Counselors/Interns (LPCs) we also provide behavioral health support, counseling and refferals for prevention and treatment if needed. Through our partner refferral network of healthcare providers, LHC, CAP, educators, state agencies, faith based and social services agencies NFP participants, mothers and children are linked to appropriate diagnostics, specialty care, Behavioral health services, educational, workforce, parenting and early childhhod services. Finally, through donors and partners such as Molina, Driscoll and Superior health care and the Salinas Charitable Trust NFP participnats ansd their children are provided resources and support for recognitions, graduation ceremonies, incentives, meals for training to our moms and for diagnostic care that maybe needed. For their children these resources help with emergency diapers, cribs and car seats.

HHS Data Use Agreement V.8.3 HIPAA Omnibus Compliant April 1, 2015

GOVERNMENTAL ENTITY VERSION

DATA USE AGREEMENT

BETWEEN THE

TEXAS HEALTH AND HUMAN SERVICES ENTERPRISE

AND

CITY OF LAREDO (“CONTRACTOR”)

This Data Use Agreement (“DUA”), effective as of the Base Contract (“Effective Date”), is entered

into by and between the Texas Health and Human Services Enterprise agency (“HHS”) and City of Laredo

(“CONTRACTOR”), and incorporated into the terms of HHS Contract No. _________________, in Travis

County, Texas (the "Base Contract").

ARTICLE 1. PURPOSE; APPLICABILITY; ORDER OF PRECEDENCE

The purpose of this DUA is to facilitate creation, receipt, maintenance, use, disclosure or access to

Confidential Information with CONTRACTOR, and describe CONTRACTOR’s rights and obligations with

respect to the Confidential Information and the limited purposes for which the CONTRACTOR may create,

receive, maintain, use, disclose or have access to Confidential Information. 45 CFR 164.504(e)(1)-(3) This

DUA also describes HHS’s remedies in the event of CONTRACTOR’s noncompliance with its obligations

under this DUA. This DUA applies to both Business Associates and contractors who are not Business

Associates who create, receive, maintain, use, disclose or have access to Confidential Information on behalf

of HHS, its programs or clients as described in the Base Contract.

As of the Effective Date of this DUA, if any provision of the Base Contract, including any General

Provisions or Uniform Terms and Conditions, conflicts with this DUA, this DUA controls.

ARTICLE 2. DEFINITIONS

For the purposes of this DUA, capitalized, underlined terms have the meanings set forth in the

following: Health Insurance Portability and Accountability Act of 1996, Public Law 104-191 (42 U.S.C.

§1320d, et seq.) and regulations thereunder in 45 CFR Parts 160 and 164, including all amendments,

regulations and guidance issued thereafter; The Social Security Act, including Section 1137 (42 U.S.C.

§§ 1320b-7), Title XVI of the Act; The Privacy Act of 1974, as amended by the Computer Matching and

Privacy Protection Act of 1988, 5 U.S.C. § 552a and regulations and guidance thereunder; Internal Revenue

Code, Title 26 of the United States Code and regulations and publications adopted under that code, including

IRS Publication 1075; OMB Memorandum 07-18; Texas Business and Commerce Code Ch. 521; Texas

Government Code, Ch. 552, and Texas Government Code §2054.1125. In addition, the following terms in

this DUA are defined as follows:

“Authorized Purpose” means the specific purpose or purposes described in the Scope of Work of

the Base Contract for CONTRACTOR to fulfill its obligations under the Base Contract, or any other purpose

expressly authorized by HHS in writing in advance.

“Authorized User” means a Person:

(1) Who is authorized to create, receive, maintain, have access to, process, view, handle,

examine, interpret, or analyze Confidential Information pursuant to this DUA;

(2) For whom CONTRACTOR warrants and represents has a demonstrable need to create,

receive, maintain, use, disclose or have access to the Confidential Information; and

(3) Who has agreed in writing to be bound by the disclosure and use limitations pertaining to

the Confidential Information as required by this DUA.

http://www.ssa.gov/OP_Home/ssact/title11/1171.htm

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“Confidential Information” means any communication or record (whether oral, written,

electronically stored or transmitted, or in any other form) provided to or made available to CONTRACTOR

or that CONTRACTOR may create, receive, maintain, use, disclose or have access to on behalf of HHS that

consists of or includes any or all of the following:

(1) Client Information;

(2) Protected Health Information in any form including without limitation, Electronic

Protected Health Information or Unsecured Protected Health Information;

(3) Sensitive Personal Information defined by Texas Business and Commerce Code Ch. 521;

(4) Federal Tax Information;

(5) Personally Identifiable Information;

(6) Social Security Administration Data, including, without limitation, Medicaid

information;

(7) All privileged work product;

(8) All information designated as confidential under the constitution and laws of the State of

Texas and of the United States, including the Texas Health & Safety Code and the Texas Public

Information Act, Texas Government Code, Chapter 552.

“Legally Authorized Representative” of the Individual, as defined by Texas law, including as

provided in 45 CFR 435.923 (Medicaid); 45 CFR 164.502(g)(1) (HIPAA); Tex. Occ. Code § 151.002(6);

Tex. H. & S. Code §166.164; Estates Code Ch. 752 and Texas Prob. Code § 3.

ARTICLE 3. CONTRACTOR 'S DUTIES REGARDING CONFIDENTIAL INFORMATION

Section 3.01 Obligations of CONTRACTOR

CONTRACTOR agrees that:

(A) CONTRACTOR will exercise reasonable care and no less than the same degree of care

CONTRACTOR uses to protect its own confidential, proprietary and trade secret information to prevent

any portion of the Confidential Information from being used in a manner that is not expressly an

Authorized Purpose under this DUA or as Required by Law. 45 CFR 164.502(b)(1); 45 CFR 164.514(d)

(B) CONTRACTOR will not, without HHS’s prior written consent, disclose or allow access

to any portion of the Confidential Information to any Person or other entity, other than Authorized User's

Workforce or Subcontractors of CONTRACTOR who have completed training in confidentiality, privacy,

security and the importance of promptly reporting any Event or Breach to CONTRACTOR's

management, to carry out the Authorized Purpose or as Required by Law.

HHS, at its election, may assist CONTRACTOR in training and education on specific or unique

HHS processes, systems and/or requirements. CONTRACTOR will produce evidence of completed

training to HHS upon request. 45 C.F.R. 164.308(a)(5)(i); Texas Health & Safety Code §181.101

(C) CONTRACTOR will establish, implement and maintain appropriate sanctions against

any member of its Workforce or Subcontractor who fails to comply with this DUA, the Base Contract or

applicable law. CONTRACTOR will maintain evidence of sanctions and produce it to HHS upon

request.45 C.F.R. 164.308(a)(1)(ii)(C); 164.530(e); 164.410(b); 164.530(b)(1)

(D) CONTRACTOR will not, without prior written approval of HHS, disclose or provide

access to any Confidential Information on the basis that such act is Required by Law without notifying

HHS so that HHS may have the opportunity to object to the disclosure or access and seek appropriate

http://www.statutes.legis.state.tx.us/docs/GV/htm/GV.552.htm

HHS Contract No. 529-16-0003-0000_


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relief. If HHS objects to such disclosure or access, CONTRACTOR will refrain from disclosing or

providing access to the Confidential Information until HHS has exhausted all alternatives for relief. 45

CFR 164.504(e)(2)(ii)(A)

(E) CONTRACTOR will not attempt to re-identify or further identify Confidential

Information or De-identified Information, or attempt to contact any Individuals whose records are

contained in the Confidential Information, except for an Authorized Purpose, without express written

authorization from HHS or as expressly permitted by the Base Contract. 45 CFR 164.502(d)(2)(i) and (ii)

CONTRACTOR will not engage in prohibited marketing or sale of Confidential Information. 45 CFR

164.501, 164.508(a)(3) and (4); Texas Health & Safety Code Ch. 181.002

(F) CONTRACTOR will not permit, or enter into any agreement with a Subcontractor to,

create, receive, maintain, use, disclose, have access to or transmit Confidential Information, on behalf of

CONTRACTOR without requiring that Subcontractor first execute the Form Subcontractor Agreement,

Attachment 1, which ensures that the Subcontractor will comply with the identical terms, conditions,

safeguards and restrictions as contained in this DUA for PHI and any other relevant Confidential

Information and which permits more strict limitations; and 45 CFR 164.502(e)(1)(1)(ii); 164.504(e)(1)(i)

and (2)

(G) CONTRACTOR is directly responsible for compliance with, and enforcement of, all

conditions for creation, maintenance, use, disclosure, transmission and Destruction of Confidential

Information and the acts or omissions of Subcontractors as may be reasonably necessary to prevent

unauthorized use. 45 CFR 164.504(e)(5); 42 CFR 431.300, et seq.

(H) If CONTRACTOR maintains PHI in a Designated Record Set, CONTRACTOR will

make PHI available to HHS in a Designated Record Set or, as directed by HHS, provide PHI to the

Individual, or Legally Authorized Representative of the Individual who is requesting PHI in compliance

with the requirements of the HIPAA Privacy Regulations. CONTRACTOR will make other Confidential

Information in CONTRACTOR’s possession available pursuant to the requirements of HIPAA or other

applicable law upon a determination of a Breach of Unsecured PHI as defined in HIPAA. 45 CFR

164.524and 164.504(e)(2)(ii)(E)

(I) CONTRACTOR will make PHI as required by HIPAA available to HHS for amendment

and incorporate any amendments to this information that HHS directs or agrees to pursuant to the HIPAA.

45 CFR 164.504(e)(2)(ii)(E) and (F)

(J) CONTRACTOR will document and make available to HHS the PHI required to provide

access, an accounting of disclosures or amendment in compliance with the requirements of the HIPAA

Privacy Regulations. 45 CFR 164.504(e)(2)(ii)(G) and 164.528

(K) If CONTRACTOR receives a request for access, amendment or accounting of PHI by

any Individual subject to this DUA, it will promptly forward the request to HHS; however, if it would

violate HIPAA to forward the request, CONTRACTOR will promptly notify HHS of the request and of

CONTRACTOR’s response. Unless CONTRACTOR is prohibited by law from forwarding a request,

HHS will respond to all such requests, unless HHS has given prior written consent for CONTRACTOR to

respond to and account for all such requests. 45 CFR 164.504(e)(2)

(L) CONTRACTOR will provide, and will cause its Subcontractors and agents to provide, to

HHS periodic written certifications of compliance with controls and provisions relating to information

privacy, security and breach notification, including without limitation information related to data transfers

and the handling and disposal of Confidential Information. 45 CFR 164.308; 164.530(c); 1 TAC 202

(M) Except as otherwise limited by this DUA, the Base Contract, or law applicable to the

Confidential Information, CONTRACTOR may use or disclose PHI for the proper management and

HHS Contract No. 529-16-0003-0000_


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administration of CONTRACTOR or to carry out CONTRACTOR’s legal responsibilities if: 45 CFR

164.504(e)(ii)(1)(A)

(1) Disclosure is Required by Law, provided that CONTRACTOR complies with Section

3.01(D);

(2) CONTRACTOR obtains reasonable assurances from the Person to whom the information

is disclosed that the Person will:

(a) Maintain the confidentiality of the Confidential Information in accordance with this DUA;

(b) Use or further disclose the information only as Required by Law or for the Authorized

Purpose for which it was disclosed to the Person; and

(c) Notify CONTRACTOR in accordance with Section 4.01 of any Event or Breach of

Confidential Information of which the Person discovers or should have discovered with the

exercise of reasonable diligence. 45 CFR 164.504(e)(4)(ii)(B)

(N) Except as otherwise limited by this DUA, CONTRACTOR will, if requested by HHS,

use PHI to provide data aggregation services to HHS, as that term is defined in the HIPAA, 45 C.F.R.

§164.501 and permitted by HIPAA. 45 CFR 164.504(e)(2)(i)(B)

(O) CONTRACTOR will, on the termination or expiration of this DUA or the Base Contract,

at its expense, return to HHS or Destroy, at HHS’s election, and to the extent reasonably feasible and

permissible by law, all Confidential Information received from HHS or created or maintained by

CONTRACTOR or any of CONTRACTOR’s agents or Subcontractors on HHS's behalf if that data

contains Confidential Information. CONTRACTOR will certify in writing to HHS that all the

Confidential Information that has been created, received, maintained, used by or disclosed to

CONTRACTOR, has been Destroyed or returned to HHS, and that CONTRACTOR and its agents and

Subcontractors have retained no copies thereof. Notwithstanding the foregoing, CONTRACTOR

acknowledges and agrees that it may not Destroy any Confidential Information if federal or state law, or

HHS record retention policy or a litigation hold notice prohibits such Destruction. If such return or

Destruction is not reasonably feasible, or is impermissible by law, CONTRACTOR will immediately

notify HHS of the reasons such return or Destruction is not feasible, and agree to extend indefinitely the

protections of this DUA to the Confidential Information and limit its further uses and disclosures to the

purposes that make the return of the Confidential Information not feasible for as long as CONTRACTOR

maintains such Confidential Information. 45 CFR 164.504(e)(2)(ii)(J)

(P) CONTRACTOR will create, maintain, use, disclose, transmit or Destroy Confidential

Information in a secure fashion that protects against any reasonably anticipated threats or hazards to the

security or integrity of such information or unauthorized uses. 45 CFR 164.306; 164.530(c)

(Q) If CONTRACTOR accesses, transmits, stores, and/or maintains Confidential

Information, CONTRACTOR will complete and return to HHS at [email protected] the HHS

information security and privacy initial inquiry (SPI) at Attachment 2 . The SPI identifies basic privacy

and security controls with which CONTRACTOR must comply to protect HHS Confidential Information.

CONTRACTOR will comply with periodic security controls compliance assessment and monitoring by

HHS as required by state and federal law, based on the type of Confidential Information CONTRACTOR

creates, receives, maintains, uses, discloses or has access to and the Authorized Purpose and level of risk.

CONTRACTOR's security controls will be based on the National Institute of Standards and Technology

(NIST) Special Publication 800-53. CONTRACTOR will update its security controls assessment

whenever there are significant changes in security controls for HHS Confidential Information and will

provide the updated document to HHS. HHS also reserves the right to request updates as needed to

satisfy state and federal monitoring requirements. 45 CFR 164.306


HHS Contract No. 529-16-0003-0000_


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(R) CONTRACTOR will establish, implement and maintain any and all appropriate

procedural, administrative, physical and technical safeguards to preserve and maintain the

confidentiality, integrity, and availability of the Confidential Information, and with respect to PHI, as

described in the HIPAA Privacy and Security Regulations, or other applicable laws or regulations relating

to Confidential Information, to prevent any unauthorized use or disclosure of Confidential Information as

long as CONTRACTOR has such Confidential Information in its actual or constructive possession. 45

CFR 164.308 (administrative safeguards); 164.310 (physical safeguards); 164.312 (technical

safeguards); 164.530(c)(privacy safeguards)

(S) CONTRACTOR will designate and identify, subject to HHS approval, a Person or

Persons, as Privacy Official 45 CFR 164.530(a)(1) and Information Security Official, each of whom is

authorized to act on behalf of CONTRACTOR and is responsible for the development and

implementation of the privacy and security requirements in this DUA. CONTRACTOR will provide

name and current address, phone number and e-mail address for such designated officials to HHS upon

execution of this DUA and prior to any change. 45 CFR 164.308(a)(2)

(T) CONTRACTOR represents and warrants that its Authorized Users each have a

demonstrated need to know and have access to Confidential Information solely to the minimum extent

necessary to accomplish the Authorized Purpose pursuant to this DUA and the Base Contract, and further,

that each has agreed in writing to be bound by the disclosure and use limitations pertaining to the

Confidential Information contained in this DUA. 45 CFR 164.502; 164.514(d)

(U) CONTRACTOR and its Subcontractors will maintain an updated, complete, accurate and

numbered list of Authorized Users, their signatures, titles and the date they agreed to be bound by the

terms of this DUA, at all times and supply it to HHS, as directed, upon request.

(V) CONTRACTOR will implement, update as necessary, and document reasonable and

appropriate policies and procedures for privacy, security and Breach of Confidential Information and an

incident response plan for an Event or Breach, to comply with the privacy, security and breach notice

requirements of this DUA prior to conducting work under the DUA. 45 CFR 164.308; 164.316;

164.514(d); 164.530(i)(1)

(W) CONTRACTOR will produce copies of its information security and privacy policies and

procedures and records relating to the use or disclosure of Confidential Information received from,

created by, or received, used or disclosed by CONTRACTOR on behalf of HHS for HHS’s review and

approval within 30 days of execution of this DUA and upon request by HHS the following business day

or other agreed upon time frame. 45 CFR 164.308; 164.514(d)

(X) CONTRACTOR will make available to HHS any information HHS requires to fulfill HHS's

obligations to provide access to, or copies of, PHI in accordance with HIPAA and other applicable laws and

regulations relating to Confidential Information. CONTRACTOR will provide such information in a time

and manner reasonably agreed upon or as designated by the Secretary, or other federal or state law. 45 CFR

164.504(e)(2)(i)(I)

(Y) CONTRACTOR will only conduct secure transmissions of Confidential Information

whether in paper, oral or electronic form. A secure transmission of electronic Confidential Information in

motion includes secure File Transfer Protocol (SFTP) or Encryption at an appropriate level or otherwise

protected as required by rule, regulation or law. HHS Confidential Information at rest requires Encryption

unless there is adequate administrative, technical, and physical security, or as otherwise protected as

required by rule, regulation or law. All electronic data transfer and communications of Confidential

Information will be through secure systems. Proof of system, media or device security and/or Encryption

must be produced to HHS no later than 48 hours after HHS's written request in response to a compliance

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investigation, audit or the Discovery of an Event or Breach. Otherwise, requested production of such

proof will be made as agreed upon by the parties. De-identification of HHS Confidential Information is

a means of security. With respect to de-identification of PHI, "secure" means de-identified according to

HIPAA Privacy standards and regulatory guidance. 45 CFR 164.312; 164.530(d)

(Z) CONTRACTOR will comply with the following laws and standards if applicable to the type of

Confidential Information and Contractor's Authorized Purpose:

Title 1, Part 10, Chapter 202, Subchapter B, Texas Administrative Code;

The Privacy Act of 1974;

OMB Memorandum 07-16;

The Federal Information Security Management Act of 2002 (FISMA);

The Health Insurance Portability and Accountability Act of 1996 (HIPAA) as defined in the

DUA;

Internal Revenue Publication 1075 – Tax Information Security Guidelines for Federal, State

and Local Agencies;

National Institute of Standards and Technology (NIST) Special Publication 800-66 Revision

1 – An Introductory Resource Guide for Implementing the Health Insurance Portability and

Accountability Act (HIPAA) Security Rule;

NIST Special Publications 800-53 and 800-53A – Recommended Security Controls for

Federal Information Systems and Organizations, as currently revised;

NIST Special Publication 800-47 – Security Guide for Interconnecting Information

Technology Systems;

NIST Special Publication 800-88, Guidelines for Media Sanitization;

NIST Special Publication 800-111, Guide to Storage of Encryption Technologies for End

User Devices containing PHI; and

Any other State or Federal law, regulation, or administrative rule relating to the specific HHS

program area that CONTRACTOR supports on behalf of HHS.

ARTICLE 4. BREACH NOTICE, REPORTING AND CORRECTION REQUIREMENTS

Section 4.01. Breach or Event Notification to HHS. 45 CFR 164.400-414

(A) CONTRACTOR will cooperate fully with HHS in investigating, mitigating to the extent

practicable and issuing notifications directed by HHS, for any Event or Breach of Confidential

Information to the extent and in the manner determined by HHS.

(B) CONTRACTOR’S obligation begins at the Discovery of an Event or Breach and

continues as long as related activity continues, until all effects of the Event are mitigated to

HHS’s satisfaction (the "incident response period"). 45 CFR 164.404

(C) Breach Notice:

1. Initial Notice.

a. For federal information, including without limitation, Federal Tax Information, Social Security

Administration Data, and Medicaid Client Information, within the first, consecutive clock hour

of Discovery, and for all other types of Confidential Information not more than 24 hours after

http://info.sos.state.tx.us/pls/pub/readtac$ext.ViewTAC?tac_view=5&ti=1&pt=10&ch=202&sch=B&rl=Y

http://www.gpo.gov/fdsys/pkg/USCODE-2009-title44/html/USCODE-2009-title44-chap35-subchapIII.htm

http://www.irs.gov/pub/irs-pdf/p1075.pdf

http://csrc.nist.gov/publications/nistpubs/800-66-Rev1/SP-800-66-Revision1.pdf

http://csrc.nist.gov/publications/nistpubs/800-66-Rev1/SP-800-66-Revision1.pdf

http://csrc.nist.gov/publications/nistpubs/800-53-Rev3/sp800-53-rev3-final_updated-errata_05-01-2010.pdf

http://csrc.nist.gov/publications/nistpubs/800-53-Rev3/sp800-53-rev3-final_updated-errata_05-01-2010.pdf

http://csrc.nist.gov/

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Discovery, or in a timeframe otherwise approved by HHS in writing, initially report to HHS's

Privacy and Security Officers via email at: [email protected] and to the HHS division

responsible for this DUA; and IRS Publication 1075; Privacy Act of 1974, as amended by the

Computer Matching and Privacy Protection Act of 1988, 5 U.S.C. § 552a; OMB Memorandum

07-16 as cited in HHSC-CMS Contracts for information exchange.

b. Report all information reasonably available to CONTRACTOR about the Event or Breach of

the privacy or security of Confidential Information. 45 CFR 164.410

c. Name, and provide contact information to HHS for, CONTRACTOR's single point of contact

who will communicate with HHS both on and off business hours during the incident response

period.

2. 48-Hour Formal Notice. No later than 48 consecutive clock hours after Discovery, or a

time within which Discovery reasonably should have been made by CONTRACTOR of an Event

or Breach of Confidential Information, provide formal notification to the State, including all

reasonably available information about the Event or Breach, and CONTRACTOR's investigation,

including without limitation and to the extent available: For (a) - (m) below: 45 CFR 164.400-

414

a. The date the Event or Breach occurred;

b. The date of CONTRACTOR's and, if applicable, Subcontractor's Discovery;

c. A brief description of the Event or Breach; including how it occurred and who is responsible

(or hypotheses, if not yet determined);

d. A brief description of CONTRACTOR's investigation and the status of the investigation;

e. A description of the types and amount of Confidential Information involved;

f. Identification of and number of all Individuals reasonably believed to be affected, including

first and last name of the individual and if applicable the, Legally authorized representative, last

known address, age, telephone number, and email address if it is a preferred contact method, to

the extent known or can be reasonably determined by CONTRACTOR at that time;

g. CONTRACTOR’s initial risk assessment of the Event or Breach demonstrating whether

individual or other notices are required by applicable law or this DUA for HHS approval,

including an analysis of whether there is a low probability of compromise of the Confidential

Information or whether any legal exceptions to notification apply;

h. CONTRACTOR's recommendation for HHS’s approval as to the steps Individuals and/or

CONTRACTOR on behalf of Individuals, should take to protect the Individuals from potential

harm, including without limitation CONTRACTOR’s provision of notifications, credit protection,

claims monitoring, and any specific protections for a Legally Authorized Representative to take

on behalf of an Individual with special capacity or circumstances;

i. The steps CONTRACTOR has taken to mitigate the harm or potential harm caused (including

without limitation the provision of sufficient resources to mitigate);

j. The steps CONTRACTOR has taken, or will take, to prevent or reduce the likelihood of

recurrence of a similar Event or Breach;

k. Identify, describe or estimate of the Persons, Workforce, Subcontractor, or Individuals and any

law enforcement that may be involved in the Event or Breach;

l. A reasonable schedule for CONTRACTOR to provide regular updates to the foregoing in the

future for response to the Event or Breach, but no less than every three (3) business days or as

mailto:@hhsc.state.tx.us

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otherwise directed by HHS, including information about risk estimations, reporting, notification,

if any, mitigation, corrective action, root cause analysis and when such activities are expected to

be completed; and

m. Any reasonably available, pertinent information, documents or reports related to an Event or

Breach that HHS requests following Discovery.

Section 4.02 Investigation, Response and Mitigation. For A-F below: 45 CFR 164.308, 310

and 312; 164.530

(A) CONTRACTOR will immediately conduct a full and complete investigation, respond to

the Event or Breach, commit necessary and appropriate staff and resources to expeditiously

respond, and report as required to and by HHS for incident response purposes and for purposes of

HHS’s compliance with report and notification requirements, to the satisfaction of HHS.

(B) CONTRACTOR will complete or participate in a risk assessment as directed by HHS

following an Event or Breach, and provide the final assessment, corrective actions and

mitigations to HHS for review and approval.

(C) CONTRACTOR will fully cooperate with HHS to respond to inquiries and/or

proceedings by state and federal authorities, Persons and/or Individuals about the Event or

Breach.

(D) CONTRACTOR will fully cooperate with HHS's efforts to seek appropriate injunctive

relief or otherwise prevent or curtail such Event or Breach, or to recover or protect any

Confidential Information, including complying with reasonable corrective action or measures, as

specified by HHS in a Corrective Action Plan if directed by HHS under the Base Contract.

Section 4.03 Breach Notification to Individuals and Reporting to Authorities. Tex. Bus. &

Comm. Code §521.053; 45 CFR 164.404 (Individuals), 164.406 (Media); 164.408 (Authorities)

(A) HHS may direct CONTRACTOR to provide Breach notification to Individuals,

regulators or third-parties, as specified by HHS following a Breach.

(B) CONTRACTOR must obtain HHS’s prior written approval of the time, manner and

content of any notification to Individuals, regulators or third-parties, or any notice required by

other state or federal authorities. Notice letters will be in CONTRACTOR's name and on

CONTRACTOR's letterhead, unless otherwise directed by HHS, and will contain contact

information, including the name and title of CONTRACTOR's representative, an email address

and a toll-free telephone number, for the Individual to obtain additional information.

(C) CONTRACTOR will provide HHS with copies of distributed and approved

communications.

(D) CONTRACTOR will have the burden of demonstrating to the satisfaction of HHS that

any notification required by HHS was timely made. If there are delays outside of

CONTRACTOR's control, CONTRACTOR will provide written documentation of the reasons

for the delay.

(E) If HHS delegates notice requirements to CONTRACTOR, HHS shall, in the time and

manner reasonably requested by CONTRACTOR, cooperate and assist with CONTRACTOR’s

information requests in order to make such notifications and reports.

HHS Contract No. 529-16-0003-0000_


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ARTICLE 5. SCOPE OF WORK

Scope of Work means the services and deliverables to be performed or provided by

CONTRACTOR, or on behalf of CONTRACTOR by its Subcontractors or agents for HHS that are described

in detail in the Base Contract. The Scope of Work, including any future amendments thereto, is incorporated

by reference in this DUA as if set out word-for-word herein.

ARTICLE 6. GENERAL PROVISIONS

Section 6.01 Ownership of Confidential Information

CONTRACTOR acknowledges and agrees that the Confidential Information is and will remain the

property of HHS. CONTRACTOR agrees it acquires no title or rights to the Confidential Information.

Section 6.02 HHS Commitment and Obligations

HHS will not request CONTRACTOR to create, maintain, transmit, use or disclose PHI in any manner

that would not be permissible under applicable law if done by HHS.

Section 6.03 HHS Right to Inspection

At any time upon reasonable notice to CONTRACTOR, or if HHS determines that CONTRACTOR

has violated this DUA, HHS, directly or through its agent, will have the right to inspect the facilities, systems,

books and records of CONTRACTOR to monitor compliance with this DUA. For purposes of this

subsection, HHS’s agent(s) include, without limitation, the HHS Office of the Inspector General or the Office

of the Attorney General of Texas, outside consultants or legal counsel or other designee.

Section 6.04 Term; Termination of DUA; Survival

This DUA will be effective on the date on which CONTRACTOR executes the DUA, and will

terminate upon termination of the Base Contract and as set forth herein . If the Base Contract is extended or

amended, this DUA is updated automatically concurrent with such extension or amendment.

(A) HHS may immediately terminate this DUA and Base Contract upon a material violation

of this DUA.

(B) Termination or Expiration of this DUA will not relieve CONTRACTOR of its obligation

to return or Destroy the Confidential Information as set forth in this DUA and to continue to safeguard the

Confidential Information until such time as determined by HHS.

(D) If HHS determines that CONTRACTOR has violated a material term of this DUA; HHS

may in its sole discretion:

1. Exercise any of its rights including but not limited to reports, access and inspection under

this DUA and/or the Base Contract; or

2. Require CONTRACTOR to submit to a corrective action plan, including a plan for

monitoring and plan for reporting, as HHS may determine necessary to maintain compliance with

this DUA; or

3. Provide CONTRACTOR with a reasonable period to cure the violation as determined

by HHS; or

HHS Contract No. 529-16-0003-0000_


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4. Terminate the DUA and Base Contract immediately, and seek relief in a court of

competent jurisdiction in Travis County, Texas.

Before exercising any of these options, HHS will provide written notice to CONTRACTOR

describing the violation and the action it intends to take.

(E) If neither termination nor cure is feasible, HHS shall report the violation to the Secretary.

(F) The duties of CONTRACTOR or its Subcontractor under this DUA survive the expiration or

termination of this DUA until all the Confidential Information is Destroyed or returned to HHS, as

required by this DUA.

Section 6.05 Governing Law, Venue and Litigation

(A) The validity, construction and performance of this DUA and the legal relations among the

Parties to this DUA will be governed by and construed in accordance with the laws of the State of Texas.

(B) The Parties agree that the courts of Travis County, Texas, will be the exclusive venue for

any litigation, special proceeding or other proceeding as between the parties that may be brought, or arise

out of, or in connection with, or by reason of this DUA.

Section 6.06 Injunctive Relief

(A) CONTRACTOR acknowledges and agrees that HHS may suffer irreparable injury if

CONTRACTOR or its Subcontractor fails to comply with any of the terms of this DUA with respect to

the Confidential Information or a provision of HIPAA or other laws or regulations applicable to

Confidential Information.

(B) CONTRACTOR further agrees that monetary damages may be inadequate to compensate

HHS for CONTRACTOR's or its Subcontractor's failure to comply. Accordingly, CONTRACTOR

agrees that HHS will, in addition to any other remedies available to it at law or in equity, be entitled to

seek injunctive relief without posting a bond and without the necessity of demonstrating actual damages,

to enforce the terms of this DUA.

Section 6.07 Indemnification

To the extent permitted by law, CONTRACTOR will indemnify, defend and hold harmless HHS and its

respective Executive Commissioner, employees, Subcontractors, agents (including other state agencies acting

on behalf of HHS) or other members of its Workforce (each of the foregoing hereinafter referred to as

“Indemnified Party”) against all actual and direct losses suffered by the Indemnified Party and all liability to

third parties arising from or in connection with any breach of this DUA or from any acts or omissions related

to this DUA by CONTRACTOR or its employees, directors, officers, Subcontractors, or agents or other

members of its Workforce. The duty to indemnify, defend and hold harmless is independent of the duty to

insure and continues to apply even in the event insurance coverage required, if any, in the DUA or Base

Contract is denied, or coverage rights are reserved by any insurance carrier. Upon demand, CONTRACTOR

will reimburse HHS for any and all losses, liabilities, lost profits, fines, penalties, costs or expenses (including

reasonable attorneys’ fees) which may for any reason be imposed upon any Indemnified Party by reason of

any suit, claim, action, proceeding or demand by any third party to the extent caused by and which results

from the CONTRACTOR’s failure to meet any of its obligations under this DUA. To the extent permitted by

law, CONTRACTOR’s obligation to defend, indemnify and hold harmless any Indemnified Party will

survive the expiration or termination of this DUA.

HHS Contract No. 529-16-0003-0000_


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Section 6.08 Insurance

(A) CONTRACTOR represents and warrants that it maintains either self-insurance or

commercial insurance with policy limits sufficient to cover any liability arising from any acts or

omissions by CONTRACTOR or its employees, directors, officers, Subcontractors, or agents or other

members of its Workforce under this DUA. CONTRACTOR warrants that HHS will be a loss payee and

beneficiary of any such claims.

(B) CONTRACTOR will provide HHS with written proof that required insurance coverage is

in effect, at the request of HHS.

Section 6.09 Fees and Costs

Except as otherwise specified in this DUA or the Base Contract, including but not limited to

requirements to insure and/or indemnify HHS, if any legal action or other proceeding is brought for the

enforcement of this DUA, or because of an alleged dispute, contract violation, Event, Breach, default,

misrepresentation, or injunctive action, in connection with any of the provisions of this DUA, each party will

bear their own legal expenses and the other cost incurred in that action or proceeding.

Section 6.10 Entirety of the Contract

This Data Use Agreement is incorporated by reference into the Base Contract and, together with the

Base Contract, constitutes the entire agreement between the parties. No change, waiver, or discharge of

obligations arising under those documents will be valid unless in writing and executed by the party against

whom such change, waiver, or discharge is sought to be enforced.

Section 6.11 Automatic Amendment and Interpretation

Upon the effective date of any amendment or issuance of additional regulations to HIPAA, or any

other law applicable to Confidential Information, this DUA will automatically be amended so that the

obligations imposed on HHS and/or CONTRACTOR remain in compliance with such requirements. Any

ambiguity in this DUA will be resolved in favor of a meaning that permits HHS and CONTRACTOR to

comply with HIPAA or any other law applicable to Confidential Information.

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ATTACHMENT 1. SUBCONTRACTOR AGREEMENT FORM

HHS CONTRACT NUMBER _________________________________

The DUA between HHS and CONTRACTOR establishes the permitted and required uses and disclosures

of Confidential Information by CONTRACTOR.

CONTRACTOR has subcontracted with____________________________________

(SUBCONTRACTOR) for performance of duties on behalf of CONTACTOR which are subject to the

DUA. SUBCONTRACTOR acknowledges, understands and agrees to be bound by the identical terms

and conditions applicable to CONTRACTOR under the DUA, incorporated by reference in this

Agreement, with respect to HHS Confidential Information. CONTRACTOR and SUBCONTRACTOR

agree that HHS is a third-party beneficiary to applicable provisions of the subcontract.

HHS has the right but not the obligation to review or approve the terms and conditions of the subcontract

by virtue of this Subcontractor Agreement Form.

CONTRACTOR and SUBCONTRACTOR assure HHS that any Breach or Event as defined by the DUA

that SUBCONTRACTOR Discovers will be reported to HHS by CONTRACTOR in the time, manner

and content required by the DUA.

If CONTRACTOR knows or should have known in the exercise of reasonable diligence of a pattern of

activity or practice by SUBCONTRACTOR that constitutes a material breach or violation of the DUA or

the SUBCONTRACTOR's obligations CONTRACTOR will:

1. Take reasonable steps to cure the violation or end the violation, as applicable;

2. If the steps are unsuccessful, terminate the contract or arrangement with SUBCONTRACTOR, if

feasible;

3. Notify HHS immediately upon reasonably discovery of the pattern of activity or practice of

SUBCONTRACTOR that constitutes a material breach or violation of the DUA and keep HHS

reasonably and regularly informed about steps CONTRACTOR is taking to cure or end the

violation or terminate SUBCONTACTOR's contract or arrangement.

This Subcontractor Agreement Form is executed by the parties in their capacities indicated below.

CONTRACTOR SUBCONTRACTOR

BY: BY:

NAME: ______________________________ NAME:_________________________________

TITLE: ______________________________ TITLE:_________________________________

DATE _______________________, 201 . DATE:_________________________________

HHSC Uniform Terms and Conditions Version 1.5 Published and Effective: April 01, 2015 Responsible Office: Chief Counsel

CHECK THE MASTER AT http://www.hhsc.state.tx.us/about_hhsc/Contracting/rfp_attch/General_TC.pdf TO VERIFY THAT THIS IS THE CORRECT VERSION BEFORE USE

Health and Human Services Commission

HHSC Uniform Terms and Conditions Version 1.5



CONTENTS

Article 1. Introduction ................................................................................................................... 1

Section 1.01 Inducements. .......................................................................................................... 1 Section 1.02 Construction of Agreement. .................................................................................... 1

(a) Scope of Introductory Article. ........................................................................................ 1 (b) References to the “State.” ............................................................................................. 1 (c) Severability. ................................................................................................................... 1 (d) Survival of terms. ........................................................................................................... 1 (e) Headings. ...................................................................................................................... 1 (f) Global drafting conventions. .......................................................................................... 1

Section 1.03 No implied authority. ............................................................................................... 2 Section 1.04 Legal Authority. ....................................................................................................... 2

Article 2. Definitions ...................................................................................................................... 2

Article 3. General Terms and Conditions .................................................................................... 4

Section 3.01 Agreement elements. .............................................................................................. 4 (a) Entire Agreement. .......................................................................................................... 4 (b) Order of precedence. ..................................................................................................... 4

Section 3.02 Funding. .................................................................................................................. 4 Section 3.03 Delegation of authority. ........................................................................................... 4 Section 3.04 No waiver of sovereign immunity. ........................................................................... 4 Section 3.05 Force majeure. ........................................................................................................ 4 Section 3.06 Other Health and Human Services Agencies’ participation in the Agreement. ...... 4 Section 3.07 Most favored customer. .......................................................................................... 5 Section 3.08 Publicity. .................................................................................................................. 5

(a) No Use ........................................................................................................................... 5 (b) Limited Exception .......................................................................................................... 5

Section 3.09 Assignment. ............................................................................................................ 5 (a) Assignment by CONTRACTOR. ................................................................................... 5 (b) Assignment by HHSC. ................................................................................................... 5 (c) Assumption. ................................................................................................................... 5

Section 3.10 Cooperation with other vendors and prospective vendors. .................................... 5 (a) Supplemental Contracts ................................................................................................ 5 (b) Access ........................................................................................................................... 5

Section 3.11 Renegotiation and reprocurement rights. ............................................................... 5 (a) Renegotiation of Agreement terms. ............................................................................... 5 (b) Reprocurement of the services or procurement of additional services. ........................ 6 (c) Termination rights upon reprocurement. ....................................................................... 6

Section 3.12 Solicitation errors and omissions. ........................................................................... 6 Section 3.13 Attorneys’ fees. ....................................................................................................... 6 Section 3.14 Preferences under service contracts. ..................................................................... 6 Section 3.15 Ensuring timely performance. ................................................................................. 6

Article 4. Contractor Personnel Management ............................................................................ 6

Section 4.01 Qualifications, retention and replacement of CONTRACTOR employees. ............ 6 Section 4.02 Responsibility for CONTRACTOR personnel. ........................................................ 6

(a) Employment and Agency............................................................................................... 6 (b) E-Verify System ............................................................................................................. 6 (c) Liability ........................................................................................................................... 7

Section 4.03 Cooperation with HHSC and state administrative agencies. .................................. 7 (a) Cooperation with HHSC contractors. ............................................................................ 7 (b) Cooperation with state and federal administrative agencies. ........................................ 7



Section 4.04 Conduct of and responsibility for CONTRACTOR personnel. ................................ 7 (a) Conduct ......................................................................................................................... 7 (b) Removal ........................................................................................................................ 7 (c) Sole Control ................................................................................................................... 7

Section 4.05 Responsibility for subcontractors. ........................................................................... 8 Section 4.06 HHSC’s ability to contract with subcontractors. ...................................................... 8

Article 5. Governing Law and Regulations ................................................................................. 8

Section 5.01 Governing law and venue. ...................................................................................... 8 Section 5.02 CONTRACTOR responsibility for compliance with laws and regulations. .............. 8 Section 5.03 Compliance with immigration laws. ......................................................................... 9 Section 5.04 Compliance with anti-discrimination laws, regulations, and rules. ......................... 9 Section 5.05 Compliance with environmental protection laws. .................................................... 9

(a) Pro-Children Act of 1994. .............................................................................................. 9 (b) National Environmental Policy Act of 1969. ................................................................ 10 (c) Clean Air Act and Water Pollution Control Act regulations. ........................................ 10 (d) State Clean Air Implementation Plan. ......................................................................... 10 (e) Safe Drinking Water Act of 1974. ................................................................................ 10

Section 5.06 Compliance with Fraud, Waste, and Abuse requirements. .................................. 10 Section 5.07 Electronic and Information Resources Accessibility Standards. .......................... 10

(a) Applicability. ................................................................................................................. 10 (b) Definitions. ................................................................................................................... 10 (c) Evaluation, Testing, and Monitoring. ........................................................................... 10 (d) Representations and Warranties. ................................................................................ 11 (e) Remedies. ................................................................................................................... 11

Section 5.08 Prohibition Against Performance Outside the United States. ............................... 11 (a) Authority ...................................................................................................................... 11 (b) Prohibition .................................................................................................................... 12 (c) Meaning of “within the United States” and “outside the United States.” ..................... 12 (d) Maintenance of Confidential Information ..................................................................... 12 (e) Performance of Work under Agreement ...................................................................... 12 (f) Exceptions ................................................................................................................... 12 (g) Disclosure .................................................................................................................... 13 (h) Remedy ....................................................................................................................... 13

Article 6. Service Levels and Performance Measurement ...................................................... 13

Section 6.01 Performance measurement. ................................................................................. 13

Article 7. Amendments, Modifications, and Change Order Requests ................................... 13

Section 7.01 Amendments and modifications. ........................................................................... 13 (a) Amendments and modifications resulting from changes in law or contract. ............... 13 (b) Modifications resulting from imposition of remedies. .................................................. 13

Section 7.02 Required compliance with amendment modification procedures. ........................ 13

Article 8. Audit and Financial Compliance ................................................................................ 13

Section 8.01 Record retention and audit. .................................................................................. 13 Section 8.02 Access to records, books, and documents. .......................................................... 14

(a) Notice ........................................................................................................................... 14 (b) Access ......................................................................................................................... 14 (c) Entities ......................................................................................................................... 14 (d) Accommodations ......................................................................................................... 14

Section 8.03 Audits and inspections of Services and Deliverables. .......................................... 14 Section 8.04 Response/compliance with audit or inspection findings. ...................................... 14 Section 8.05 Audit of CONTRACTOR fees. .............................................................................. 15 Section 8.06 SAO Audit. ............................................................................................................ 15



Article 9. Terms and Conditions of Payment ............................................................................ 15

Section 9.01 Rights of set-off. .................................................................................................... 15 (a) General right of set-off. ................................................................................................ 15 (b) Duty to make payments. .............................................................................................. 15

Section 9.02 Expenses. ............................................................................................................. 15 Section 9.03 Disputed fees. ....................................................................................................... 15 Section 9.04 Liability for taxes. .................................................................................................. 16 Section 9.05 Liability for employment-related charges and benefits. ........................................ 16 Section 9.06 No additional consideration. ................................................................................. 16 Section 9.07 No increase in rates. ............................................................................................. 16

Article 10. Disclosure and Confidentiality of Information ....................................................... 16

Section 10.01 Confidentiality. .................................................................................................... 16 (a) HHSC Data Use Agreement ........................................................................................ 16

Section 10.02 Requests for public information. ......................................................................... 16 Section 10.03 Privileged Work Product. .................................................................................... 16 Section 10.04 Unauthorized acts. .............................................................................................. 17 Section 10.05 Legal action. ........................................................................................................ 17

Article 11. Remedies and Disputes ............................................................................................ 17

Section 11.01 Understanding and expectations. ....................................................................... 17 Section 11.02 Tailored remedies. .............................................................................................. 17

(a) Understanding of the Parties. ...................................................................................... 17 (b) Notice and opportunity to cure for non-material breach. ............................................. 17 (c) Corrective action plan. ................................................................................................. 18 (d) Administrative remedies. ............................................................................................. 18 (e) Damages. .................................................................................................................... 19 (f) Equitable Remedies .................................................................................................... 19 (g) Suspension of Agreement ........................................................................................... 19

Section 11.03 Termination of Agreement. ................................................................................. 20 (a) Termination by mutual agreement of the Parties. ....................................................... 20 (b) Termination in the best interest of the State. ............................................................... 20 (c) Termination for cause. ................................................................................................. 20

Section 11.04 Effective date of termination. .............................................................................. 21 Section 11.05 Extension of termination effective date. .............................................................. 21 Section 11.06 Payment and other provisions at Agreement termination. ................................. 21 Section 11.07 Modification of Agreement in the event of remedies. ......................................... 21 Section 11.08 Turnover assistance. .......................................................................................... 21 Section 11.09 Rights upon termination or expiration of Agreement. ......................................... 22 Section 11.10 CONTRACTOR responsibility for associated costs. ........................................... 22 Section 11.11 Dispute resolution. .............................................................................................. 22

(a) General agreement of the Parties. .............................................................................. 22 (b) Duty to negotiate in good faith. .................................................................................... 22 (c) Claims for breach of Agreement. ................................................................................. 22

Section 11.12 Liability of CONTRACTOR. ................................................................................ 23

Article 12. Assurances and Certifications ................................................................................ 23

Section 12.01 Proposal certifications. ........................................................................................ 23 Section 12.02 Conflicts of interest. ............................................................................................ 23

(a) Representation. ........................................................................................................... 23 (b) General duty regarding conflicts of interest. ................................................................ 23

Section 12.03 Organizational conflicts of interest. ..................................................................... 23 (a) Definition. ..................................................................................................................... 23 (b) Warranty. ..................................................................................................................... 23 (c) Continuing duty to disclose. ........................................................................................ 24



(d) Remedy. ...................................................................................................................... 24 (e) Flow down obligation. .................................................................................................. 24

Section 12.04 HHSC personnel recruitment prohibition. ........................................................... 24 Section 12.05 Anti-kickback provision. ...................................................................................... 24 Section 12.06 Debt or back taxes owed to the State of Texas. ................................................. 24 Section 12.07 Certification regarding status of license, certificate, or permit. ........................... 24 Section 12.08 Outstanding debts and judgments. ..................................................................... 24 Section 12.09 Anti-trust. ............................................................................................................. 24

Article 13. Representations and Warranties ............................................................................. 25

Section 13.01 Authorization. ...................................................................................................... 25 Section 13.02 Ability to perform. ................................................................................................ 25 Section 13.03 Workmanship and performance. ......................................................................... 25 Section 13.04 Warranty of deliverables. .................................................................................... 25 Section 13.05 Manufacturers’ warranties. ................................................................................. 25 Section 13.06 Compliance with Agreement. .............................................................................. 25

Article 14. Intellectual Property .................................................................................................. 25

Section 14.01 Infringement and misappropriation. .................................................................... 25 Section 14.02 Exceptions. ......................................................................................................... 26

Article 15. Liability ....................................................................................................................... 26

Section 15.01 Property damage. ............................................................................................... 26 Section 15.02 Risk of Loss. ....................................................................................................... 26 Section 15.03 Limitation of HHSC’s Liability. ............................................................................. 26

Article 16. Special Terms and Conditions ................................................................................. 27

Section 16.01 HHSC Data Use Agreement Not Required ......................................................... 27 Section 16.02 Financial/performance audits. ............................................................................. 28 Section 16.03 Audit software. .................................................................................................... 28 Section 16.04 Ownership and licenses. ..................................................................................... 28

(a) Custom software. ......................................................................................................... 28 (b) Ownership rights. ......................................................................................................... 28 (c) License Rights ............................................................................................................. 29 (d) Proprietary Notices ...................................................................................................... 29 (e) Third Party Software and Documentation Licenses .................................................... 29 (f) State and Federal Governments ................................................................................. 29

Section 16.05 Insurance Coverage. .......................................................................................... 29 (a) Required Coverage. .................................................................................................... 29 (b) Proof of Insurance Coverage ...................................................................................... 30

Section 16.06 Background Checks. ........................................................................................... 30 Section 16.07 Historically Underutilized Business Participation Requirements ........................ 31

(a) Definitions. ........................................................................................................................ 31 (b) HUB Requirements. .......................................................................................................... 31

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Article 1. Introduction

Section 1.01 Inducements.

In making the award of the Agreement, the Health and Human Services Commission (HHSC) relies on CONTRACTOR’s assurances of the following:

(1) CONTRACTOR and its subcontractors are established providers of the types of services described in the Solicitation;

(2) CONTRACTOR and its subcontractors have the skills, qualifications, expertise, financial resources, and experience necessary to perform the services described in the Solicitation, CONTRACTOR’s Proposal, and the Agreement in an efficient, cost-effective manner, with a high degree of quality and responsiveness, and has performed similar services for other public or private entities;

(3) CONTRACTOR has thoroughly reviewed, analyzed, and understood the Solicitation, has timely raised all questions or objections to the Solicitation, and has had the opportunity to review and fully understand the HHSC’s current program and operating environment for the activities that are the subject of the Agreement and the needs and requirements of the State during the Agreement term;

(4) CONTRACTOR has had the opportunity to review and understand the State’s stated objectives in entering into the Agreement and, based on such review and understanding, CONTRACTOR currently has the capability to perform in accordance with the terms and conditions of the Agreement;

(5) CONTRACTOR also has reviewed and understands the risks associated with the HHSC Programs as described in the Solicitation, including the risk of non-appropriation of funds.

Accordingly, HHSC desires to engage CONTRACTOR to perform the services described in the Agreement under the terms and conditions set forth in the Agreement.

Section 1.02 Construction of Agreement.

(a) Scope of Introductory Article.

The provisions of any introductory article to the Agreement are intended to be a general introduction and are not intended to expand the scope of the Parties’ obligations under the Agreement or to alter the plain meaning of the terms and conditions of the Agreement.

(b) References to the “State.”

References in the Agreement to the “State” mean the State of Texas unless otherwise indicated and will be interpreted, as appropriate, to mean or include HHSC and other agencies of the State of Texas that may participate in the administration of HHSC Programs, provided, however, that no provision will be interpreted to include any entity other than HHSC as the contracting agency.

(c) Severability. If any provision of the Agreement is for any reason held to be unenforceable, the rest of it remains fully

enforceable.

(d) Survival of terms.

Termination or expiration of the Agreement for any reason will not release either Party from any liabilities or obligations set forth in the Agreement that:

(1) The Parties agree will survive the termination or expiration; or

(2) Remain to be performed or by their nature would be intended to be applicable following any such termination or expiration.

(e) Headings.

The article and section headings in the Agreement are for reference and convenience only and may not be considered in the interpretation of the Agreement.

(f) Global drafting conventions.

(1) The terms “include,” “includes,” and “including” are terms of inclusion and enlargement, and where used in the Agreement, should be read as if followed by the phrase “without limitation.”

(2) Any references to “sections,” “appendices,” or “attachments” are references to sections, appendices, or attachments of the Agreement.

(3) Any references to agreements, contracts, statutes, or administrative rules or regulations in the Agreement are references to these documents as amended, modified, or supplemented from time to time during the term of the Agreement.

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Section 1.03 No implied authority.

The authority delegated to CONTRACTOR by HHSC is limited to the terms of the Agreement. HHSC is the state agency designated by the Texas Legislature to administer the HHSC Programs, and no other state agency grants CONTRACTOR any authority related to the Agreement unless directed through HHSC. CONTRACTOR may not rely upon implied authority and is not delegated authority under the Agreement to:

(1) make public policy;

(2) promulgate, amend, or disregard administrative regulations or program policy decisions made by State and federal agencies responsible for administration of HHSC Programs; or

(3) unilaterally communicate or negotiate with any federal or state agency or the Texas Legislature on behalf of HHSC regarding HHSC Programs or the Agreement.

To the fullest extent possible, CONTRACTOR is required to assist HHSC in communications and negotiations with state and federal governments and agencies as directed by HHSC.

Section 1.04 Legal Authority.

(a) HHSC is authorized to enter into the Agreement under Chapter 531 or 533, Texas Government Code; Section 2155.144, Texas Government Code; or Chapter 62, Texas Health & Safety Code. CONTRACTOR is authorized to enter into the Agreement pursuant to the authorization of its governing board or controlling owner or officer.

(b) The person or persons signing and executing the Agreement on behalf of the Parties, or representing themselves as signing and executing the Agreement on behalf of the Parties, warrant and guarantee that he, she, or they have been duly authorized to execute the Agreement and to validly and legally bind the Parties to all of its terms, performances, and provisions.

Article 2. Definitions

As used in the Agreement, the following terms and conditions have the meanings assigned below:

“Agreement” means the formal, written, and legally enforceable agreement and amendments between the Parties.

“Change” means any alteration, adjustment, exchange, substitution, or modification of the Services under the Agreement that are authorized in accordance with Article 7 of the Agreement.

“Change Order Request” means a request to make a change in the Services or Deliverables under the Agreement.

“Children’s Health Insurance Program” or “CHIP” means the health insurance program authorized and funded pursuant to Title XXI, Social Security Act (42 U.S.C. §§ 1397aa-1397jj) and administered by HHSC.

“Confidential Information” means any communication or record (whether oral, written, electronically stored or transmitted, or in any other form) provided to or made available to CONTRACTOR or that CONTRACTOR may create, receive, maintain, use, disclose or have access to on behalf of HHS that consists of or includes any or all of the following:

(1) Client Information; (2) Protected Health Information in any form including without limitation, Electronic Protected Health Information

or Unsecured Protected Health Information; (3) Sensitive Personal Information defined by Texas Business and Commerce Code Ch. 521; (4) Federal Tax Information; (5) Personally Identifiable Information; (6) Social Security Administration Data, including, without limitation, Medicaid information; (7) All privileged work product; (8) All information designated as confidential under the constitution and laws of the State of Texas and of the

United States, including the Texas Health & Safety Code and the Texas Public Information Act, Texas Government Code, Chapter 552; and

(9) Other Confidential Information as designated in the Agreement.

"CONTRACTOR" means the Party identified in the Agreement as the individual or entity that is required to perform the Services and related obligations under the Agreement.

“Corrective Action Plan” means the detailed written plan required by HHSC to correct or resolve a material deficiency or breach of the Agreement.

“Deliverable” means a work product prepared, developed, or procured by CONTRACTOR as part of the Services under the Agreement for the use or benefit of HHSC or the State of Texas.

“Disability” means a physical or mental impairment that substantially limits one or more of the major life activities of an individual.

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“Effective Date” means the date of complete execution of the Agreement unless another date is agreed to by the Parties as the date on which the Agreement takes effect. For purposes of the Agreement, the term includes any period under which work is performed in accordance with a properly executed Letter of Intent between HHSC and CONTRACTOR.

“Electronic and information resources (EIR)” --Includes information technology and any equipment or interconnected system or subsystem of equipment used to create, convert, duplicate, or deliver data or information. EIR includes telecommunications products (such as telephones), information kiosks and transaction machines, web sites, multimedia, and office equipment such as copiers and fax machines. The term does not include any equipment that contains embedded information technology that is used as an integral part of the product, but the principal function of which is not the acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information. For example, thermostats or temperature control devices, and medical equipment that contain information technology that is integral to its operation, are not information technology. If the embedded information technology has an externally available web or computer interface, that interface is considered EIR. Other terms such as, but not limited to, Information and Communications Technology (ICT), Electronic Information Technology (EIT), etc. can be considered interchangeable terms with EIR for purposes of the Agreement.

“Health and Human Services Commission” or “HHSC” means the administrative agency within the executive department of Texas state government established under Chapter 531, Texas Government Code or its designee, including, but not limited to, the Texas Health and Human Services Agencies.

“HHSC Programs” means the public health and human service programs administered by HHSC, including but not limited to Medicaid and CHIP.

“Initial Term” means the period between the Effective Date and the original expiration date of the Agreement.

“Material Subcontract” means any Subcontract that exceeds, or is reasonably expected to exceed, $100,000 per year. Any Subcontracts between the CONTRACTOR and a single entity that are split into separate agreements by time period, program, or service area, etc., may be consolidated for the purpose of this definition.

“Material Subcontractor (or Major Subcontractor)” means any entity with a Material Subcontract with CONTRACTOR.

“Medicaid” means the medical assistance entitlement program authorized and funded pursuant to Title XIX, Social Security Act (42 U.S.C. § 1396 et seq.) and administered by HHSC.

“Other Confidential Information” means any communication or record (whether oral, written, electronically stored or transmitted, or in any other form) provided to or made available to CONTRACTOR or that CONTRACTOR may create, receive, maintain, use, disclose or have access to on behalf of HHSC that is expressly designated as Other Confidential Information in the Agreement.

“Parties” means HHSC and CONTRACTOR, collectively.

“Party” means either HHSC or CONTRACTOR, individually.

“Proposal” means the proposal submitted by the CONTRACTOR in response to the Solicitation. “Public information” means information that:

(1) Is collected, assembled, or maintained under a law or ordinance or in connection with the transaction of official business by a governmental body or for a governmental body;

(2) The governmental body owns or has a right of access to; and

(3) Is not Confidential Information.

“Solicitation” means the written invitation for bids, request for offers, request for proposals, or similar instrument that is posted on the HHSC Website and/or Electronic State Business Daily, seeking responses from qualified vendors for needed goods and services. This term also includes "price requests" and "pricing requests" sent to Department of Information Resources vendors to get pricing, based on a specific scope of work, through a Cooperative Contract or DBITS contract. and any addendums under which the Agreement was awarded and is executed.

“Scope of Work” means the description of Services and Deliverables specified in the Agreement, the Solicitation, and any agreed modifications.

“Services” means the tasks, functions, and responsibilities assigned and delegated to CONTRACTOR under the Agreement.

“Software” means all operating system and applications software used or created by CONTRACTOR to provide the Services under the Agreement.

“Subcontract” means any written agreement between CONTRACTOR and other party to fulfill the requirements of the Agreement. All subcontracts are required to be in writing.

“Subcontractor” means any individual or entity that has entered into a subcontract with CONTRACTOR.

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“Turnover Plan” means the written plan developed by CONTRACTOR, approved by HHSC, and to be employed in the event that the work described in the Agreement transfers to the State or another vendor from CONTRACTOR. HHSC may require CONTRACTOR to develop a Turnover Plan at any time during the term of the Agreement at HHSC’s discretion. The Turnover Plan describes CONTRACTOR’s policies and procedures that will assure:

(1) The least disruption in the delivery of services during the transition to a substitute vendor; and

(2) Cooperation with HHSC and the substitute vendor in transferring information and services to a substitute vendor.

Article 3. General Terms and Conditions

Section 3.01 Agreement elements.

(a) Entire Agreement.

The Agreement between the Parties will consist of the document bearing the signatures of the Parties, Exhibits, or Attachments to that document, these Uniform Terms and Conditions, the Solicitation (CONTRACTOR’s Proposal and any agreed to modifications (incorporated by reference).

(b) Order of precedence.

Unless otherwise agreed, in the event of any conflict or contradiction between or among these documents, the documents will control in the following order of precedence:

(1) The final executed document that bears the signature of the Parties, including any Exhibits or attachments, and all amendments to that document;

(2) These Uniform Terms and Conditions, including any attachments;

(3) The Solicitation and any addendums, corrections, and clarifications. ;

(4) CONTRACTOR’s Proposal and any agreed to modifications.

Section 3.02 Funding.

The Agreement is conditioned on the availability of state and federal appropriated funds. CONTRACTOR will have no right of action against HHSC in the event that HHSC is unable to perform its obligations under the Agreement as a result of the suspension, termination, withdrawal of funding to HHSC, the failure to fund HHSC, or lack of sufficient funding of HHSC for any activities or functions contained within the scope of the Agreement. If funds become unavailable, the provisions of Article 11 (Remedies and Disputes) will apply. HHSC will use all reasonable efforts to ensure that such funds are available, and will negotiate in good faith with CONTRACTOR to resolve any CONTRACTOR claims for payment that represent accepted Services or Deliverables that are pending at the time funds become unavailable. HHSC will make best efforts to provide reasonable written advance notice to CONTRACTOR upon learning that funding for the Agreement may be discontinued.

Section 3.03 Delegation of authority.

Whenever, by any provision of the Agreement, any right, power, or duty is imposed or conferred on HHSC, the right, power, or duty so imposed or conferred is possessed and exercised by HHSC’s Executive Commissioner unless any right, power, or duty is delegated to the duly appointed agents or employees of HHSC. HHSC’s Executive Commissioner will reduce any delegation of authority to writing and provide a copy to CONTRACTOR on request.

Section 3.04 No waiver of sovereign immunity.

The Parties agree that no provision of the Agreement is in any way intended to constitute a waiver by HHSC or the State of Texas of any immunities from suit or from liability that HHSC or the State of Texas may have by operation of law.

Section 3.05 Force majeure.

A Party will not be liable for any failure or delay in performing its obligations under the Agreement if such failure or delay is due to any cause beyond the reasonable control of the Party, including, but not limited to, unusually severe weather, strikes, natural disasters, fire, civil disturbance, epidemic, war, court order, or acts of God. The existence of such causes of delay or failure will extend the period of performance in the exercise of reasonable diligence until after the causes of delay or failure have been removed. Each Party must inform the other in writing with proof of receipt within five (5) business days of the existence of a force majeure event as described above or otherwise waive this right as a defense.

Section 3.06 Other Health and Human Services Agencies’ participation in the Agreement.

In addition to providing the Services specified for HHSC, CONTRACTOR agrees to allow other Health and Human Service Agencies the option to participate in the Agreement under the same terms and conditions. Each

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agency that elects to obtain services under this section will issue a purchase order to CONTRACTOR, referring to, and incorporating by reference, the terms and conditions specified in the Agreement.

Section 3.07 Most favored customer.

The CONTRACTOR agrees that if during the term of the Agreement, the CONTRACTOR enters into any agreement with any other governmental customer, or any non-affiliated commercial customer by which it agrees to provide equivalent services at lower prices, or additional services at comparable prices, the Agreement will, at HHSC’s option, be amended to accord equivalent advantage to HHSC.

Section 3.08 Publicity.

(a) No Use

Except as provided in the paragraphs below, CONTRACTOR must not use the name of, or directly or indirectly refer to, HHSC, the State of Texas, or any other State agency in any media release, public announcement, or public disclosure relating to the Agreement or its subject matter, including in any promotional or marketing materials, customer lists, or business presentations (other than proposals or reports submitted to HHSC, an administrative agency of the State of Texas, or a governmental agency or unit of another state or the Federal government).

(b) Limited Exception

CONTRACTOR may publish, at its sole expense, results of CONTRACTOR performance under the Agreement with HHSC’s prior review and approval, which HHSC may exercise at its sole discretion. Any publication (written, visual, or sound) will acknowledge the support received from HHSC and any Federal agency, as appropriate. CONTRACTOR will provide HHSC at least three (3) copies of any such publication prior to public release. CONTRACTOR will provide additional copies at the request of HHSC. CONTRACTOR may include information concerning the Agreement’s terms, subject matter, and estimated value in any report to a governmental body to which the CONTRACTOR is required by law to report such information.

Section 3.09 Assignment.

(a) Assignment by CONTRACTOR.

CONTRACTOR will not assign all or any portion of its rights under or interests in the Agreement or delegate any of its duties without prior written consent of HHSC. Any written request for assignment or delegation must be accompanied by written acceptance of the assignment or delegation by the assignee or delegation by the delegate. Except where otherwise agreed in writing by HHSC, assignment or delegation will not release CONTRACTOR from its obligations under the Agreement.

(b) Assignment by HHSC.

CONTRACTOR understands and agrees HHSC may in one or more transactions assign, pledge, or transfer the Agreement. This assignment will only be made to another State agency or a non-state agency that is contracted to perform agency support.

(c) Assumption.

Each party to whom a transfer is made must assume all or any part of CONTRACTOR’S or HHSC's interests in the Agreement, the product, and any documents executed with respect to the Agreement, including, without limitation, the assignor's obligation for all or any portion of the purchase payments, in whole or in part.

Section 3.10 Cooperation with other vendors and prospective vendors.

(a) Supplemental Contracts

HHSC may award supplemental contracts for work related to the Agreement, or any portion thereof. HHSC reserves the right to award the Contract as a joint venture between two or more potential vendors, if such an arrangement is in the best interest of HHSC. CONTRACTOR agrees to cooperate with such other vendors, and will not commit or permit any act that may interfere with the performance of work by any other vendor.

(b) Access At HHSC's request, CONTRACTOR will allow parties interested in responding to HHSC Solicitations to have

reasonable access during normal business hours to software, systems documentation, and site visits to the CONTRACTOR’s facilities. All such parties inspecting the facilities and software and systems documentation may be required to agree to use the information so obtained only in the State of Texas and only for the purpose of responding to the Solicitation.

Section 3.11 Renegotiation and reprocurement rights.

(a) Renegotiation of Agreement terms.

Notwithstanding anything in the Agreement to the contrary, HHSC may at any time during the term of the Agreement exercise the option to notify CONTRACTOR that HHSC has elected to renegotiate certain terms of the

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Agreement within the scope of the Agreement and as permitted by law. Upon CONTRACTOR’s receipt of any notice under this Section, CONTRACTOR and HHSC will undertake good faith negotiations of the subject terms of the Agreement.

(b) Reprocurement of the services or procurement of additional services.

Notwithstanding anything in the Agreement to the contrary, whether or not HHSC has accepted or rejected CONTRACTOR’s Services or Deliverables provided during any period of the Agreement, HHSC may at any time issue requests for proposals or offers to other potential contractors for performance of any portion of the Services covered by the Agreement or services similar or comparable to the Services performed by CONTRACTOR under the Agreement.

(c) Termination rights upon reprocurement.

If HHSC elects to procure the Services or any portion of the Services from another vendor in accordance with this Section, HHSC will have the termination rights set forth in Article 11.

Section 3.12 Solicitation errors and omissions.

CONTRACTOR will not take advantage of any errors or omissions in the Solicitation or the resulting Agreement. CONTRACTOR must promptly notify HHSC of any errors or omissions that are discovered. Failure to notify HHSC of any errors will constitute a waiver of those errors.

Section 3.13 Attorneys’ fees.

In the event of any litigation, appeal, or other legal action to enforce any provision of the Agreement, CONTRACTOR agrees to pay all expenses of such action, including attorneys' fees and costs if HHSC is the prevailing or substantially prevailing Party.

Section 3.14 Preferences under service contracts.

CONTRACTOR is required in performing the Agreement to purchase products and materials produced in the State of Texas when they are available at a price and time comparable to products and materials produced outside the State.

Section 3.15 Ensuring timely performance.

The Parties acknowledge the need to ensure uninterrupted and continuous performance of the Scope of Work under the Agreement, therefore, HHSC may terminate the Agreement or apply any other remedy as noted in Article 11 (Remedies and Disputes) if CONTRACTOR’s performance is not timely.

Article 4. Contractor Personnel Management

Section 4.01 Qualifications, retention and replacement of CONTRACTOR employees.

CONTRACTOR agrees to maintain the organizational and administrative capacity and capabilities to carry out all duties and responsibilities under the Agreement. The personnel CONTRACTOR assigns to perform the duties and responsibilities under the Agreement will be properly trained and qualified for the functions they are to perform. CONTRACTOR does not warrant the quality of training for which the State is responsible. Notwithstanding transfer or turnover of personnel, CONTRACTOR remains obligated to perform all duties and responsibilities under the Agreement without degradation and in accordance with the terms of the Agreement.

Section 4.02 Responsibility for CONTRACTOR personnel.

(a) Employment and Agency CONTRACTOR’s employees and subcontractors will not in any sense be considered employees of HHSC or the

State of Texas, but will be considered CONTRACTOR’s employees for all purposes. Except as provided in the Agreement, neither CONTRACTOR nor any of CONTRACTOR’s employees or subcontractors may act in any sense as agents or representatives of HHSC or the State of Texas. (b) E-Verify System By entering into this Contract, the Contractor certifies and ensures that it utilizes and will continue to utilize, for the term of this Contract, the U.S. Department of Homeland Security’s E-Verify system to determine the eligibility of:

1. All persons employed to perform duties within Texas, during the term of the Contract; and 2. All persons (including subcontractors) assigned by the Respondent to perform work pursuant to the Contract, within the United States of America.

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(c) Liability

CONTRACTOR’s employees must be paid exclusively by CONTRACTOR for all services performed. CONTRACTOR is responsible for and must comply with all requirements and obligations related to such employees under local, state or federal law, including minimum wage, social security, unemployment insurance, state and federal income tax, and workers’ compensation obligations. CONTRACTOR assumes sole and full responsibility for its acts and omissions and the acts and omissions of its personnel and subcontractors.

CONTRACTOR AGREES THAT ANY CLAIM ON BEHALF OF ANY PERSON ARISING OUT OF EMPLOYMENT OR ALLEGED EMPLOYMENT (INCLUDING, BUT NOT LIMITED TO, CLAIMS OF DISCRIMINATION AGAINST CONTRACTOR, ITS OFFICERS, OR ITS AGENTS) ARE THE SOLE RESPONSIBILITY OF CONTRACTOR AND ARE NOT THE RESPONSIBILITY OF HHSC, AND THAT CONTRACTOR WILL INDEMNIFY AND HOLD HARMLESS THE STATE FROM ANY AND ALL SUCH CLAIMS ASSERTED AGAINST THE STATE.

CONTRACTOR understands that any person who alleges a claim arising out of employment or alleged employment by CONTRACTOR will not be entitled to any compensation, rights, or benefits from HHSC (including, but not limited to, tenure rights, medical and hospital care, sick and annual/vacation leave, severance pay, or retirement benefits).

Section 4.03 Cooperation with HHSC and state administrative agencies.

(a) Cooperation with HHSC contractors.

CONTRACTOR agrees to reasonably cooperate with and work with the State’s contractors, subcontractors and third-party representatives as requested by HHSC. To the extent permitted by HHSC’s financial and personnel resources, HHSC agrees to reasonably cooperate with CONTRACTOR and to use its best efforts to ensure that HHSC's other HHSC Programs contractors reasonably cooperate with CONTRACTOR.

(b) Cooperation with state and federal administrative agencies.

CONTRACTOR must ensure that CONTRACTOR personnel will cooperate with HHSC or other state or federal administrative agency personnel at no charge to HHSC for purposes relating to the administration of HHSC programs including, but not limited to the following purposes:

(1) The investigation and prosecution of fraud, abuse, and waste in the HHSC programs;

(2) Audit, inspection, or other investigative purposes; and

(3) Testimony in judicial or quasi-judicial proceedings relating to the Services under the Agreement or other delivery of information to HHSC or other agencies’ investigators or legal staff.

Section 4.04 Conduct of and responsibility for CONTRACTOR personnel.

(a) Conduct While performing the Services or Deliverables, CONTRACTOR’s personnel and subcontractors must:

(1) Comply with applicable Agreement terms, State and federal rules, regulations, HHSC’s policies, and HHSC’s requests regarding personal and professional conduct; and

(2) Otherwise conduct themselves in a businesslike and professional manner.

(b) Removal If HHSC determines in good faith that a particular employee or subcontractor is not conducting himself or herself

in accordance with this Section, HHSC may provide CONTRACTOR with notice and documentation concerning such conduct. Upon receipt of such notice, CONTRACTOR must promptly investigate the matter and, at HHSC's request, take appropriate action that may include:

(1) Removing the employee from the project;

(2) Providing HHSC with written notice of such removal; and

(3) Replacing the employee with a similarly qualified individual acceptable to HHSC.

Nothing in the Agreement will prevent CONTRACTOR, at the request of HHSC, from replacing any personnel who HHSC determines are not adequately performing their assigned responsibilities or who, in the reasonable opinion of HHSC’s Project Director, after consultation with CONTRACTOR, are unable to work effectively with the members of the HHSC’s staff. In such event, CONTRACTOR will provide replacement personnel with equal or greater skills and qualifications as soon as reasonably practicable. Replacement of Key Personnel will be subject to HHSC review and approval. The Parties will work together in the event of any such required replacement so as not to disrupt the overall project schedule.

(c) Sole Control

CONTRACTOR agrees that anyone employed by CONTRACTOR to fulfill the terms of the Agreement is an employee of CONTRACTOR and remains under CONTRACTOR’s sole direction and control.

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CONTRACTOR agrees to be responsible for the following with respect to its employees:

(1) Any and all employment taxes or other payroll withholding;

(2) Damages caused by CONTRACTOR’s employees acting within or outside the scope of their duties under the Agreement; and

(3) Determination of the hours to be worked and the duties to be performed by CONTRACTOR’s employees.

CONTRACTOR agrees and will inform its employees and subcontractor(s) that there is no right of action against HHSC for any duty owed by CONTRACTOR under the Agreement. CONTRACTOR understands that HHSC does not assume liability for the actions of, or judgments rendered against, the CONTRACTOR, its employees, agents or subcontractors. CONTRACTOR agrees that it has no right to indemnification or contribution from HHSC for any judgments rendered against CONTRACTOR or its subcontractors. HHSC’s liability to the CONTRACTOR’s employees, agents and subcontractors, if any, will be governed by the Texas Tort Claims Act, as amended or modified (Tex. Civ. Pract. & Rem. Code § 101.001 et seq.).

Section 4.05 Responsibility for subcontractors.

CONTRACTOR remains fully responsible for obligations, services, and functions performed by its subcontractors to the same extent as if such obligations, services, and functions were performed by CONTRACTOR’S employees, and for purposes of the Agreement such work will be deemed work performed by CONTRACTOR. HHSC reserves the right to require the replacement of any subcontractor found by HHSC to be unacceptable.

CONTRACTOR must not disclose Confidential Information of HHSC or the State of Texas to a subcontractor unless and until such subcontractor has agreed in writing to protect the confidentiality of such Confidential Information in the manner required of CONTRACTOR under the Agreement.

CONTRACTOR must identify any subcontractor that is a newly-formed subsidiary or entity, whether or not an affiliate of CONTRACTOR, substantiate the proposed subcontractor’s ability to perform the subcontracted Services, and certify to HHSC that no loss of service will occur as a result of the performance of such subcontractor. The CONTRACTOR will assume responsibility for all contractual responsibilities whether or not the CONTRACTOR performs them. Further, HHSC considers the CONTRACTOR to be the sole point of contact with regard to contractual matters, including payment of any and all charges resulting from the Agreement.

At least 30 days prior to executing a Material Subcontract or other agreement with a third party with a value greater than $100,000.00, CONTRACTOR must submit a copy of the agreement to HHSC for HHSC’s review at HHSC’s option. HHSC reserves the right to: (1) reject the agreement or require changes to any provisions that do not comply with the requirements or duties and responsibilities of the Agreement or create significant barriers for HHSC in monitoring compliance with the Agreement; (2) object to the selection of the subcontractor; or (3) object to the subcontracting of the Services and Deliverables proposed to be subcontracted.

Section 4.06 HHSC’s ability to contract with subcontractors.

The CONTRACTOR may not limit or restrict, through a covenant not to compete, employment agreement or other contractual arrangement, HHSC’s ability to contract with subcontractors or former employees of the CONTRACTOR.

Article 5. Governing Law and Regulations

Section 5.01 Governing law and venue.

The Agreement is governed by the laws of the State of Texas and interpreted in accordance with Texas law. Provided CONTRACTOR first complies with the procedures set forth in Section 11.11, Dispute Resolution, proper venue for a claim arising from the Agreement will be in a court of competent jurisdiction in Travis County, Texas.

Section 5.02 CONTRACTOR responsibility for compliance with laws and regulations.

CONTRACTOR is responsible for compliance with all laws, regulations, and administrative rules that govern the performance of the Services including all State and Federal tax laws, State and Federal employment laws, State and Federal regulatory requirements, and licensing provisions.

CONTRACTOR is responsible for ensuring each of its employees, agents, or subcontractors who provide Services or Deliverables under the Agreement are properly licensed, certified, or have proper permits to perform any activity related to the Services.

CONTRACTOR warrants that the Services and Deliverables comply with all applicable Federal, State, and County laws, regulations, codes, ordinances, guidelines, and policies. CONTRACTOR WILL INDEMNIFY AND HOLD HARMLESS HHSC FROM AND AGAINST ANY LOSSES, LIABILITY, CLAIMS, DAMAGES, PENALTIES, COSTS, FEES, OR EXPENSES ARISING FROM OR IN CONNECTION WITH CONTRACTOR’S NEGLIGENCE OR

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CONTRACTOR’S FAILURE TO COMPLY WITH OR VIOLATION OF ANY SUCH LAW, REGULATION, CODE, ORDINANCE, OR POLICY.

Section 5.03 Compliance with immigration laws.

CONTRACTOR must comply with the requirements of the Immigration and Nationality Act (8 U.S.C § 1101 et seq.) and all subsequent immigration laws and amendments.

Section 5.04 Compliance with anti-discrimination laws, regulations, and rules.

CONTRACTOR must comply with state and federal anti-discrimination laws, including:

(a) Title VI of the Civil Rights Act of 1964 (42 U.S.C. § 2000d et seq.);

(b) Section 504 of the Rehabilitation Act of 1973 ( 29 U.S.C. § 794);

(c) Americans with Disabilities Act of 1990 (42 U.S.C. § 12101 et seq.);

(d) Age Discrimination Act of 1975 (42 U.S.C. §§ 6101-6107);

(e) Title IX of the Education Amendments of 1972 (20 U.S.C. §§ 1681-1688);

(f) Food Stamp Act of 1977 (7 U.S.C. § 200 et seq.); and

(g) HHSC’s administrative rules, as set forth in the Texas Administrative Code, to the extent applicable to the Agreement.

CONTRACTOR must comply with all amendments to the above-referenced laws, and all requirements imposed by the regulations issued under these laws. These laws provide in part that no persons in the United States may, on the grounds of race, color, national origin, sex, age, disability, political beliefs, or religion, be excluded from participation in or denied any aid, care, service or other benefits provided by Federal or State funding, or otherwise be subjected to discrimination.

CONTRACTOR must comply with Title VI of the Civil Rights Act of 1964, and its implementing regulations at 45 C.F.R. Part 80 and 7 C.F.R. Part 15, prohibiting a contractor from adopting and implementing policies and procedures that exclude or have the effect of excluding or limiting the participation of clients in its programs, benefits, or activities on the basis of national origin. Applicable state and federal civil rights laws require contractors to provide alternative methods for ensuring access to services for applicants and recipients who cannot express themselves fluently in English. CONTRACTOR must ensure that its policies do not have the effect of excluding or limiting the participation of persons in its programs, benefits, and activities on the basis of national origin. CONTRACTOR also must take reasonable steps to provide services and information, both orally and in writing, in appropriate languages other than English, in order to ensure that persons with limited English proficiency are effectively informed and can have meaningful access to programs, benefits, and activities.

CONTRACTOR must comply with Executive Order 13279, and its implementing regulations at 45 C.F.R. Part 87 or 7 C.F.R. Part 16. These provide in part that any organization that participates in programs funded by direct financial assistance from the United States Department of Agriculture or the United States Department of Health and Human Services will not, in providing services, discriminate against a program beneficiary or prospective program beneficiary on the basis of religion or religious belief. Upon request, CONTRACTOR will provide HHSC with copies of all of the CONTRACTOR’S civil rights policies and procedures.

CONTRACTOR must notify HHSC’s Civil Rights Office of any civil rights complaints received relating to its performance under the Agreement. This notice must be delivered no more than ten calendar days after receipt of a complaint. Notice provided under this section must be directed to:

HHSC Civil Rights Office 701 W. 51st Street, Mail Code W206 Austin, Texas 78751 Phone Toll Free: (888) 388-6332 Phone: (512) 438-4313 TTY Toll Free: (877) 432-7232 Fax: (512) 438-5885.

Section 5.05 Compliance with environmental protection laws.

CONTRACTOR must comply with state and federal environmental laws, including, without limitation:

(a) Pro-Children Act of 1994.

CONTRACTOR must comply with the Pro-Children Act of 1994 (20 U.S.C. § 6081 et seq.), as applicable, regarding the provision of a smoke-free workplace and promoting the non-use of all tobacco products.

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(b) National Environmental Policy Act of 1969.

CONTRACTOR must comply with any applicable provisions relating to the institution of environmental quality control measures contained in the National Environmental Policy Act of 1969 (42 U.S.C. § 4321 et seq.) and Executive Order 11514 (“Protection and Enhancement of Environmental Quality”).

(c) Clean Air Act and Water Pollution Control Act regulations.

CONTRACTOR must comply with any applicable provisions relating to required notification of facilities violating the requirements of Executive Order 11738 (“Providing for Administration of the Clean Air Act and the Federal Water Pollution Control Act with Respect to Federal Contracts, Grants, or Loans”).

(d) State Clean Air Implementation Plan.

CONTRACTOR must comply with any applicable provisions requiring conformity of federal actions to State (Clean Air) Implementation Plans under §176(c) of the Clean Air Act of 1955, as amended (42 U.S.C. § 7401 et seq.).

(e) Safe Drinking Water Act of 1974.

CONTRACTOR must comply with applicable provisions relating to the protection of underground sources of drinking water under the Safe Drinking Water Act of 1974, as amended (21 U.S.C. § 349; 42 U.S.C. §§ 300f to 300j-9).

Section 5.06 Compliance with Fraud, Waste, and Abuse requirements.

CONTRACTOR, CONTRACTOR’s personnel, and all subcontractors must comply with all fraud, waste, and abuse requirements found in HHS Circular C-027.

Section 5.07 Electronic and Information Resources Accessibility Standards. (a) Applicability.

The following Electronic and Information Resources (EIR) requirements apply to the Agreement because CONTRACTOR performs services that include EIR that: (i) HHSC employees are required or permitted to access; or (ii) members of the public are required or permitted to access. This Section does not apply to incidental uses of EIR in the performance of the Agreement, unless the Parties agree that the EIR will become property of the State of Texas or will be used by HHSC’s clients or recipients after completion of the Agreement. Nothing in this section is intended to prescribe the use of particular designs or technologies or to prevent the use of alternative technologies, provided they result in substantially equivalent or greater access to and use of a Product.

(b) Definitions.

For purposes of this Section:

“Accessibility Standards” means accessibility standards and specifications for Texas agency and institution of higher education websites and EIR set forth in 1 Tex.Admin. Code Texas Administrative Code, Chapter 206 and/or Chapter 213

“Electronic and Information Resources” means information resources, including information resources technologies, and any equipment or interconnected system of equipment that is used in the creation, conversion, duplication, or delivery of data or information. The term includes telephones and other telecommunications products, information kiosks, transaction machines, Internet websites, multimedia resources, and office equipment, including copy machines and fax machines.

“Electronic and Information Resources Accessibility Standards” means the accessibility standards for electronic and information resources contained in 1 Tex.Admin. Code Chapter 213.

“Product” means information resources technology that is, or is related to, EIR.

“Web Site Accessibility Standards/ Specifications” means standards contained in Volume 1 Tex. Admin. Code Chapter 206.(c) Accessibility Requirements.

Under Tex. Gov’t Code Chapter 2054, Subchapter M, and implementing rules of the Texas Department of Information Resources, HHSC must procure Products and services that comply with the Accessibility Standards when those Products are available in the commercial marketplace or when those Products are developed in response to a procurement solicitation. Accordingly, CONTRACTOR must provide electronic and information resources and associated Product documentation and technical support that comply with the Accessibility Standards.

(c) Evaluation, Testing, and Monitoring.

(1) HHSC may review, test, evaluate and monitor CONTRACTOR’s Products and services, as well as associated documentation and technical support for compliance with the Accessibility Standards. Review, testing, evaluation and monitoring may be conducted before and after the award of a contract. Testing and monitoring may include user acceptance testing.

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Neither (1) the review, testing (including acceptance testing), evaluation or monitoring of any Product or service, nor (2) the absence of review, testing, evaluation or monitoring, will result in a waiver of the State’s right to contest the CONTRACTOR’s assertion of compliance with the Accessibility Standards.

(2) CONTRACTOR agrees to cooperate fully and provide HHSC and its representatives timely access to Products, records, and other items and information needed to conduct such review, evaluation, testing, and monitoring.

(d) Representations and Warranties.

(1) CONTRACTOR represents and warrants that: (i) as of the Effective Date of the Agreement, the Products and associated documentation and technical support comply with the Accessibility Standards as they exist at the time of entering the Agreement, unless and to the extent the Parties otherwise expressly agree in writing; and (ii) if the Products will be in the custody of the state or an HHS Agency’s client or recipient after the Contract expiration or termination, the Products will continue to comply with Accessibility Standards after the expiration or termination of the Contract Term, unless HHSC or its clients or recipients, as applicable, use the Products in a manner that renders it noncompliant.

(2) In the event CONTRACTOR becomes aware, or is notified that the Product or service and associated documentation and technical support do not comply with the Accessibility Standards, CONTRACTOR represents and warrants that it will, in a timely manner and at no cost to HHSC, perform all necessary steps to satisfy the Accessibility Standards, including remediation, replacement, and upgrading of the Product or service, or providing a suitable substitute.

(3) CONTRACTOR acknowledges and agrees that these representations and warranties are essential inducements on which HHSC relies in awarding this Agreement.

(4) CONTRACTOR’s representations and warranties under this subsection will survive the termination or expiration of the Contract and will remain in full force and effect throughout the useful life of the Product.

(e) Remedies.

(1) Under Tex. Gov’t Code § 2054.465, neither CONTRACTOR nor any other person has cause of action against HHSC for a claim of a failure to comply with Tex. Gov’t Code Chapter 2054, Subchapter M, and rules of the Department of Information Resources.

(2) In the event of a breach of CONTRACTOR’s representations and warranties, CONTRACTOR will be liable for direct, consequential, indirect, special, or liquidated damages and any other remedies to which HHSC may be entitled under this Contract and other applicable law. This remedy is cumulative of any other remedies to which HHSC may be entitled under this Contract and other applicable law.

Section 5.08 Prohibition Against Performance Outside the United States. (a) Authority

(1) HHSC is responsible for administering several public programs that require the collection and maintenance of information relating to persons who apply for and receive services from HHSC programs. This information consists of, among other things, personal financial and medical information and information designated “Confidential Information” . Some of this information may, within the limits of the law and this Agreement, be shared from time to time with CONTRACTOR or a subcontractor for purposes of performing the Services or providing the Deliverables under this Agreement.

(2) HHSC is also responsible for collecting and maintaining personal information, including personal financial and medical information, concerning persons employed by HHSC and other health and human services agencies. Some of this information may be shared from time to time with CONTRACTOR or a subcontractor or collected and maintained by CONTRACTOR or a subcontractor for purposes of performing the Services or providing the Deliverables under this Agreement.

(3) HHSC is legally responsible maintaining the confidentiality and integrity of information relating to applicants and recipients of HHSC services and employees of HHS agencies and ensuring that any person or entity that receives such information, including CONTRACTOR and any subcontractor, is similarly bound by these obligations.

(4) HHSC also is responsible for the development and implementation of computer software and hardware to support HHSC programs. These items are paid for, in whole or in part, with state and federal funds. The federal agencies that fund these items maintain a limited interest in the software and hardware so developed or acquired.

(5) Some of the software used or developed by HHSC may also be subject to statutory restrictions on the export of technology to foreign nations, including but not limited to the Export Administration Regulations, 15 C.F.R. Parts 730-774.

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(b) Prohibition

(1) In view of these obligations, and to ensure accountability, integrity, and the security of the information maintained by or for HHSC and the work performed on behalf of HHSC

HHSC DETERMINES THAT IT IS NECESSARY AND APPROPRIATE TO REQUIRE THAT:

(A) ALL WORK PERFORMED UNDER THIS AGREEMENT MUST BE PERFORMED EXCLUSIVELY WITHIN THE UNITED STATES; AND

(B) ALL INFORMATION OBTAINED BY CONTRACTOR OR A SUBCONTRACTOR UNDER THIS AGREEMENT MUST BE MAINTAINED WITHIN THE UNITED STATES.

(2) HHSC, without prior written approval, forbids the performance of any work or the maintenance of any information relating or obtained pursuant to this Agreement to occur outside of the United States except as specifically authorized or approved by HHSC.

(c) Meaning of “within the United States” and “outside the United States.”

(1) As used in this Section 17.01, the term “within the United States” means any location inside the territorial boundaries comprising the republic of the United States of America, including of any of the 48 coterminous states in North America, the states of Alaska and Hawaii, and the District of Columbia.

(2) Conversely, the phrase “outside the United States” means any location that is not within the territorial boundaries comprising the republic of the United States of America, including of any of the 48 coterminous states in North America, the states of Alaska and Hawaii, and the District of Columbia.

(d) Maintenance of Confidential Information

(1) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR must not allow any Confidential Information that CONTRACTOR receives from or on behalf of HHSC to leave the United States by any means (physical or electronic) at any time, for any period of time, for any reason.

(2) CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR must not permit any person to have remote access to HHSC information, systems, or Deliverables from a location outside the United States.

(e) Performance of Work under Agreement

(1) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions specified in paragraph (e) of this Section 17.01, CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR must perform all services under this Agreement, including all tasks, functions, and responsibilities assigned and delegated to CONTRACTOR under this Agreement, within the United States.

(A) This obligation includes all Services, including but not limited to information technology services, processing, transmission, storage, archiving, data center services, disaster recovery sites and services, customer support, medical, dental, laboratory and clinical services.

(B) All custom software prepared for performance of this Agreement, and all modifications of custom, third party, or vendor proprietary software, must be performed within the United States.

(2) Unless otherwise approved in advance by HHSC in writing, and subject to the exceptions specified in this Section, CONTRACTOR and all subcontractors, vendors, agents, and service providers of or for CONTRACTOR must not permit any person to perform work under this Agreement from a location outside the United States.

(f) Exceptions

(1) COTS Software. The foregoing requirements will not preclude the acquisition or use of commercial off-the-shelf (COTS) software that is developed outside the United States or hardware that is generically configured outside the United States.

(2) Foreign-made Products and Supplies. The foregoing requirements will not preclude CONTRACTOR from acquiring, using, or reimbursing products or supplies that are manufactured outside the United States, provided such products or supplies are commercially available within the United States for acquisition or reimbursement by HHSC.

(3) HHSC Prior Approval. The foregoing requirements will not preclude CONTRACTOR from performing work outside the United States that HHSC has approved in writing and that HHSC has confirmed will not involve the sharing of Confidential Information outside the United States.

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(g) Disclosure

CONTRACTOR must disclose all Services and Deliverables under or related to this Agreement that CONTRACTOR intends to perform or has performed outside the United States, whether directly or via subcontractors, vendors, agents, or service providers.

(h) Remedy

(1) CONTRACTOR’s violation of this Section will constitute a material breach of the Agreement. CONTRACTOR will be liable to HHSC for all actual and consequential damages in accordance with the UTC.

(2) For breach of the requirements under this Section, HHSC may terminate the Agreement with Notice to CONTRACTOR at least 1 calendar day before the effective date of such termination.

Article 6. Service Levels and Performance Measurement

Section 6.01 Performance measurement.

Satisfactory performance of the Agreement will be measured by:

(1) Adherence to the Agreement, including all representations and warranties;

(2) Compliance with project work plans, schedules, and milestones as proposed by CONTRACTOR in its Proposal and as revised by CONTRACTOR and finally approved by HHSC;

(3) Delivery of the Services and Deliverables in accordance with the service levels and availability proposed in Contractor's Proposal and as finally approved or accepted by HHSC;

(4) Results of audits performed by HHSC or its representatives in accordance with Article 8;

(5) Timeliness, completeness, and accuracy of required Deliverables; and

(6) Achievement of performance measures developed by CONTRACTOR and HHSC and as modified from time to time by written agreement during the Initial Term of the Agreement.

Article 7. Amendments, Modifications, and Change Order Requests

Section 7.01 Amendments and modifications.

(a) Amendments and modifications resulting from changes in law or contract.

The Agreement may be amended by mutual written agreement of the Parties if changes in federal or state laws, rules, regulations, policies, guidelines or circumstances affect the performance of the work. The Parties will develop a business plan for negotiating appropriate change order and amendment procedures.

(b) Modifications resulting from imposition of remedies.

The Agreement may be modified under the terms of Article 11 (relating to Remedies and Disputes).

Section 7.02 Required compliance with amendment modification procedures.

No different or additional services, work, or products will be authorized or performed except those that are within scope and that are memorialized in an amendment or modification of the Agreement that is executed in compliance with this article. No waiver of any term, covenant, or condition of the Agreement will be valid unless executed in compliance with this article. CONTRACTOR will not be entitled to payment for any services, work or products that are not authorized by a properly executed Agreement amendment or modification, or through the express authorization of HHSC.

Article 8. Audit and Financial Compliance

Section 8.01 Record retention and audit.

CONTRACTOR must maintain, and require its subcontractors to maintain, supporting information and documents that are adequate to ensure that payments are made and paid in accordance with applicable Federal and State requirements, and are sufficient to ensure the accuracy and validity of CONTRACTOR invoices. These documents, including all original claims forms, will be maintained and retained by CONTRACTOR or its subcontractors for a period of seven years after the date of submission of the final billing or until the resolution of all litigation, claim, financial management review, or audit pertaining to the Agreement, whichever is longer. CONTRACTOR agrees to timely repay any undisputed audit exceptions taken by HHSC in any audit of the Agreement.

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Section 8.02 Access to records, books, and documents.

(a) Notice

Upon reasonable notice, CONTRACTOR must provide, and cause its subcontractors to provide, the officials and entities identified in this Section with prompt, reasonable, and adequate access to any records, books, documents, and papers that are directly pertinent to the performance of the Agreement.

(b) Access

CONTRACTOR and its subcontractors must provide the access described in this Section upon HHSC’s request. This request may include the following purposes:

(1) Examination;

(2) Audit;

(3) Investigation;

(4) Contract administration; or

(5) The making of copies, excerpts, or transcripts.

(c) Entities The access required must be provided to the following officials or entities:

(1) The United States Department of Health and Human Services or its designee;

(2) The Comptroller General of the United States or its designee;

(3) Medicaid program personnel from HHSC or its designee;

(4) The Office of Investigations and Enforcement of HHSC;

(5) Any independent verification and validation contractor or quality assurance contractor, when acting on behalf of HHSC;

(6) The Office of the State Auditor of Texas or its designee;

(7) A State or Federal law enforcement agency;

(8) A special or general investigating committee of the Texas Legislature or its designee; and

(9) Any other entity identified by HHSC.

(d) Accommodations CONTRACTOR agrees to provide the access described wherever CONTRACTOR maintains the books, records,

and supporting documentation described above. CONTRACTOR further agrees to provide such access in reasonable comfort and to provide any furnishings, equipment, or other conveniences deemed reasonably necessary to fulfill the purposes described in this Section. CONTRACTOR will require its subcontractors to provide comparable access and accommodations.

Upon request, CONTRACTOR must provide copies of the information described in this Section free of charge to HHSC and the entities described in subsection (c).

Section 8.03 Audits and inspections of Services and Deliverables.

Upon notice from HHSC where possible, CONTRACTOR will provide, and will cause its subcontractors to provide, such auditors and inspectors as HHSC may from time to time designate, with access to:

(1) CONTRACTOR service locations, facilities, or installations;

(2) CONTRACTOR Software and Equipment; and

(3) CONTRACTOR records.

CONTRACTOR must provide as part of the Services any assistance that such auditors and inspectors reasonably may require to complete such audits or inspections.

Section 8.04 Response/compliance with audit or inspection findings.

(a) CONTRACTOR must take action to ensure its or a subcontractor’s compliance with a correction of any finding of noncompliance with any law, regulation, audit requirement, or generally accepted accounting principle relating to the Services and Deliverables or any other deficiency contained in any audit, review, or inspection conducted under the Agreement. This action will include CONTRACTOR’S delivery to HHSC, for HHSC’S approval, a Corrective Action Plan that addresses deficiencies identified in any audit(s), review(s), or inspection(s) within thirty (30) calendar days of the close of the audit(s), review(s), or inspection(s).

(b) CONTRACTOR must bear the expense of compliance with any finding of noncompliance under the Agreement that is:

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(1) Required by a Texas or Federal law, regulation, rule or other audit requirement relating to CONTRACTOR's business;

(2) Performed by CONTRACTOR as part of the Services and Deliverables; or

(3) Necessary due to CONTRACTOR's noncompliance with any law, regulation, rule or audit requirement imposed on CONTRACTOR.

(c) As part of the Services, CONTRACTOR must provide to HHSC upon request a copy of those portions of CONTRACTOR's and its subcontractors' internal audit reports relating to the Services and Deliverables provided to the State under the Agreement.

Section 8.05 Audit of CONTRACTOR fees.

(a) CONTRACTOR will provide, and will cause its subcontractors to provide, to HHSC and its designees access to financial records and supporting documentation reasonably requested by HHSC.

(b) In addition to the normal monthly review and payment of administrative vouchers, HHSC may audit the Fees charged to HHSC to determine whether such Fees are accurate and in accordance with the Agreement.

(c) If, as a result of such audit, HHSC determines that CONTRACTOR has overcharged the State, HHSC will notify CONTRACTOR of the amount of such overcharge and CONTRACTOR will promptly pay to HHSC the amount of the overcharge, plus interest. Interest on such overpayment amount will be calculated from the date of receipt by the CONTRACTOR of the overcharged amount until the date of payment to HHSC, and will be calculated at the Department of Treasury’s Median Rate (resulting from the Treasury’s auction of 13-week bills) for the week in which liability is assessed, but in no event to exceed the highest lawful rate of interest. In the event any such audit reveals an overcharge to HHSC, CONTRACTOR will reimburse HHSC for the cost of such audit.

Section 8.06 SAO Audit.

The CONTRACTOR understands that acceptance of funds under this Contract acts as acceptance of the authority of the State Auditor’s Office (SAO), or any successor agency, to conduct an investigation in connection with those funds. The CONTRACTOR further agrees to cooperate fully with the SAO or its successor in the conduct of the audit or investigation, including providing all records requested. The CONTRACTOR will ensure that this clause concerning the authority to audit funds received indirectly by subcontractors through CONTRACTOR and the requirement to cooperate is included in any subcontract it awards.

Article 9. Terms and Conditions of Payment

Section 9.01 Rights of set-off.

(a) General right of set-off.

With respect to any undisputed amount that a Party in good faith determines should be reimbursed to it or is otherwise payable to it by the other Party under the Agreement, the Party seeking the set-off may deduct the entire amount owed against the charges otherwise payable or expenses owed to it under the Agreement until such time as the entire amount determined to be owed has been paid.

(b) Duty to make payments.

HHSC will be relieved of its obligation to make any payments to the CONTRACTOR until such time as all set-off amounts have been credited to HHSC and the CONTRACTOR will be relieved of its obligation to make any payments to HHSC until such time as such amounts have been credited to the CONTRACTOR.

Section 9.02 Expenses.

Except as provided in the Agreement, all other expenses incurred by the CONTRACTOR in connection with its provision of the Services or Deliverables will not be reimbursed by HHSC unless agreed to by HHSC. CONTRACTOR will be responsible for payment of all expenses related to salaries, benefits, employment taxes, and insurance for its Staff. In addition, the costs associated with transportation, delivery, and insurance for each Deliverable will be paid by CONTRACTOR.

Section 9.03 Disputed fees.

If HHSC disputes payment of all or any portion of an invoice from the CONTRACTOR, HHSC will notify the CONTRACTOR of the dispute and both Parties will attempt in good faith to resolve the dispute. HHSC will not be required to pay any disputed portion of a CONTRACTOR invoice unless and until the dispute is resolved. Notwithstanding any such dispute, the CONTRACTOR must continue to perform the Services and produce Deliverables in compliance with the terms of the Agreement pending resolution of such dispute so long as all undisputed amounts continue to be paid to CONTRACTOR.

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Section 9.04 Liability for taxes.

HHSC is not responsible in any way for the payment of any federal, state or local taxes related to or incurred in connection with the CONTRACTOR’S performance of the Agreement. CONTRACTOR must pay and discharge any and all such taxes, including any penalties and interest. In addition, HHSC is exempt from Federal excise taxes, and will not pay for any personal property taxes or income taxes levied on CONTRACTOR or on any taxes levied on employee wages.

Section 9.05 Liability for employment-related charges and benefits.

CONTRACTOR will perform work under the Agreement as an independent contractor and not as agent or representative of HHSC. CONTRACTOR is solely and exclusively liable for all taxes and employment-related charges incurred in connection with the performance of the Agreement. HHSC will not be liable for any employment-related charges or benefits of CONTRACTOR, such as workers compensation benefits, unemployment insurance and benefits, or fringe benefits.

Section 9.06 No additional consideration.

CONTRACTOR will not be entitled to nor receive from HHSC any additional consideration, compensation, salary, wages, or any other type of remuneration for services rendered under the Agreement. CONTRACTOR will not be entitled by virtue of the Agreement to consideration in the form of overtime, health insurance benefits, retirement benefits, disability retirement benefits, sick leave, vacation time, paid holidays, or other paid leaves of absence of any type or kind whatsoever. In addition, the costs associated with transportation, delivery, and insurance relating to the CONTRACTOR’S performance of the Agreement will be paid for by the CONTRACTOR.

Section 9.07 No increase in rates.

CONTRACTOR will not increase rates during the term of the Agreement, except as authorized in Article 7.

Article 10. Disclosure and Confidentiality of Information

Section 10.01 Confidentiality.

(a) HHSC Data Use Agreement

The HHSC Data Use Agreement, Attachment A to these UTCs, is incorporated into the Agreement and describes CONTRACTOR’s rights and obligations with respect to the Confidential Information and the limited purposes for which the CONTRACTOR may create, receive, maintain, use, disclose or have access to Confidential Information.

Section 10.02 Requests for public information.

(a) HHSC agrees that it will promptly notify CONTRACTOR of a request for disclosure of public information filed in accordance with the Texas Public Information Act, Texas Government Code Chapter 552, which consists of the CONTRACTOR’s Confidential Information, including information to which CONTRACTOR believes it has a proprietary or commercial interest. HHSC will deliver a copy of the request for public information to CONTRACTOR.

(b) With respect to any information that is the subject of a request for disclosure, CONTRACTOR is required to demonstrate to the Texas Office of Attorney General the specific reasons why the requested information is confidential or otherwise excepted from required public disclosure under law. CONTRACTOR will provide HHSC with copies of all such communications.

(c) CONTRACTOR must make information defined as public information not otherwise excepted from disclosure under the Texas Public Information Act, Texas Government Code Chapter 552, available to HHSC in a format agreeable to HHSC, accessible by the public, and at no additional charge to HHSC.

(d) To the extent authorized under the Texas Public Information Act, HHSC agrees to safeguard from disclosure information received from CONTRACTOR that the CONTRACTOR believes to be Confidential Information. CONTRACTOR must clearly mark such information as Confidential Information or provide written notice to HHSC that it considers the information confidential.

(e) To the extent allowed under the Texas Public Information Act, Texas Government Code Chapter 552, CONTRACTOR agrees that any consultant reports received by HHSC in connection with the Agreement, may be distributed by HHSC, in its discretion, to any other state agency and the Texas legislature. Any distribution may include posting on HHSC’s website or the website of a standing committee of the legislature.

Section 10.03 Privileged Work Product.

(a) CONTRACTOR acknowledges that HHSC asserts that Privileged Work Product may be prepared in anticipation of litigation and that CONTRACTOR is performing the Services with respect to Privileged Work Product as an agent of HHSC, and that all matter related thereto is protected from disclosure by the Texas Rules of Civil Procedure, Texas Rules of Evidence, Federal Rules of Civil Procedure, or Federal Rules of Evidence.

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(b) HHSC will notify CONTRACTOR of any Privileged Work Product to which CONTRACTOR has or may have access. After the CONTRACTOR is notified or otherwise becomes aware that such documents, data, database, or communications are Privileged Work Product, only CONTRACTOR personnel for whom such access is necessary for the purposes of providing the Services may have access to Privileged Work Product.

(c) If CONTRACTOR receives notice of any judicial or other proceeding seeking to obtain access to HHSC’s Privileged Work Product, CONTRACTOR will:

(1) Immediately notify HHSC; and

(2) Use all reasonable efforts to resist providing such access.

(d) If CONTRACTOR resists disclosure of HHSC’s Privileged Work Product in accordance with this Section, HHSC will, to the extent authorized under Civil Practices and Remedies Code or other applicable State law, have the right and duty (i) to represent CONTRACTOR in such resistance; (ii) to retain counsel to so represent CONTRACTOR; or (iii) to reimburse CONTRACTOR for reasonable attorneys' fees and expenses incurred in resisting such access. HHSC will make the sole determination as to which of the preceding duties it will undertake.

(e) If a court of competent jurisdiction orders CONTRACTOR to produce documents, disclose data, or otherwise breach Contractor's confidentiality obligations or maintenance obligations regarding the confidentiality, proprietary nature, and secrecy of Privileged Work Product, CONTRACTOR will not be liable for breach of such obligation.

Section 10.04 Unauthorized acts.

Each Party agrees to:

(1) Notify the other Party promptly of any unauthorized possession, use, or knowledge, or attempt thereof, of any of the other Party's Confidential Information by any person or entity that may become known to it;

(2) Promptly furnish to the other Party full details of the unauthorized possession, use, or knowledge, or attempt thereof, and use reasonable efforts to assist the other Party in investigating or preventing the reoccurrence of any unauthorized possession, use, or knowledge, or attempt thereof, of Confidential Information;

(3) Cooperate with the other Party in any litigation and investigation against third Parties deemed necessary by such Party to protect its proprietary rights; and

(4) Promptly prevent a reoccurrence of any such unauthorized possession, use, or knowledge of Confidential Information.

Section 10.05 Legal action.

A party may not commence any legal action or proceeding with a third party with respect to any unauthorized possession, use, or knowledge, or attempt thereof, of the other Party's Confidential Information by any person or entity, if that action or proceeding identifies the other Party or its Confidential Information without such Party’s consent.

Article 11. Remedies and Disputes

Section 11.01 Understanding and expectations.

The remedies described in this Article are directed to CONTRACTOR’s timely and responsive performance of the Services and Deliverables, and to the creation of a flexible and responsive relationship between the Parties.

Section 11.02 Tailored remedies.

(a) Understanding of the Parties.

CONTRACTOR agrees and understands that HHSC may pursue tailored contractual remedies for noncompliance with the Agreement. At any time and at its discretion, HHSC may impose or pursue one or more remedies for each item of noncompliance and will determine remedies on a case-by-case basis. HHSC’s pursuit or non-pursuit of a tailored remedy does not constitute a waiver of any other remedy that HHSC may have at law or equity.

(b) Notice and opportunity to cure for non-material breach.

(1) HHSC will notify CONTRACTOR in writing of specific areas of CONTRACTOR performance that fail to meet performance expectations, standards, or schedules, but that, in the determination of HHSC, do not result in a material deficiency or delay in the implementation or operation of the Services.

(2) CONTRACTOR will, within three business days (or another date approved by HHSC) of receipt of written notice of a non-material deficiency, provide HHSC a written response that:

(A) Explains the reasons for the deficiency, CONTRACTOR’s plan to address or cure the deficiency, and the date and time by which the deficiency will be cured; or

(B) If CONTRACTOR disagrees with HHSC’s findings, explains its reasons for disagreeing with HHSC’s findings.

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(3) CONTRACTOR’s proposed cure of a non-material deficiency is subject to the approval of HHSC. CONTRACTOR’s repeated commission of non-material deficiencies or repeated failure to resolve any such deficiencies may be regarded by HHSC as a material deficiency and entitle HHSC to pursue any other remedy provided in the Agreement or any other appropriate remedy HHSC may have at law or equity.

(c) Corrective action plan.

(1) At its option, HHSC may require CONTRACTOR to submit to HHSC a detailed written plan (the “Corrective Action Plan”) to correct or resolve a material deficiency or breach of the Agreement.

(2) The Corrective Action Plan must provide:

(A) A detailed explanation of the reasons for the cited deficiency;

(B) CONTRACTOR’s assessment or diagnosis of the cause;

(C) A specific proposal to cure or resolve the deficiency; and

(D) CONTRACTOR’s timeline for cure or resolution of the deficiency

(3) The Corrective Action Plan must be submitted by the deadline set forth in HHSC’s request for a Corrective Action Plan. The Corrective Action Plan is subject to approval by HHSC, which will not be withheld unreasonably.

(4) HHSC will notify CONTRACTOR in writing of HHSC’s final disposition of HHSC’s concerns regarding the Corrective Action Plan. If HHSC accepts CONTRACTOR’s proposed Corrective Action Plan, HHSC may:

(A) Condition such approval on completion of tasks in the order or priority that HHSC may prescribe;

(B) Disapprove portions of CONTRACTOR’s proposed Corrective Action Plan; or

(C) Require additional or different corrective action(s).

(5) At any time during this remedial process, HHSC reserves the right to:

(A) Suspend all, or part of, the Agreement, and to withhold further payment for the suspended portions of the Agreement; or

(B) Prohibit CONTRACTOR from incurring additional obligations of funds during investigation of the pending corrective action, if necessary, by CONTRACTOR or a decision by HHSC to terminate the Agreement for cause.

(6) If HHSC rejects CONTRACTOR’s written explanation or proposed Corrective Action Plan, HHSC may issue a Stop Work Order to CONTRACTOR or any of its subcontractors or suppliers. HHSC may delay the implementation of the Stop Work Order if it affects the completion of any of the Services in accordance with the approved schedule or work plan.

(7) HHSC’s acceptance of a Corrective Action Plan under this Section will not:

(A) Excuse CONTRACTOR’s prior substandard performance;

(B) Relieve CONTRACTOR of its duty to comply with performance standards; or

(C) Prohibit HHSC from assessing additional tailored remedies or pursuing other appropriate remedies for continued substandard performance.

(d) Administrative remedies.

(1) At its discretion, HHSC may impose one or more of the following remedies for each item of noncompliance and will determine the scope and severity of the remedy on a case-by-case basis:

(A) Assess liquidated damages in accordance with the terms of the Agreement if provided in the Agreement;

(B) Conduct accelerated monitoring of the CONTRACTOR. Accelerated monitoring includes more frequent or more extensive monitoring by HHSC or its agent;

(C) Require additional, more detailed, financial or programmatic reports to be submitted by CONTRACTOR;

(D) Decline to renew or extend the Agreement;

(E) Withhold or recoup payment for the noncompliant Service or Deliverable; or

(F) Terminate the Agreement in accordance with Section 11.03.

(2) For purposes of the Agreement, an item of noncompliance means a specific action of CONTRACTOR that:

(A) Violates a provision of the Agreement;

(B) Fails to meet an agreed measure of performance; or

(C) Represents a failure of CONTRACTOR to be reasonably responsive to a reasonable request of HHSC relating to the Services and Deliverables for information, assistance, or support within the timeframe specified by HHSC.

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(3) HHSC will provide notice to CONTRACTOR of the imposition of an administrative remedy in accordance with this Section, with the exception of accelerated monitoring, which may be unannounced. HHSC may require CONTRACTOR to file a written response as part of the Tailored Remedy approach.

(4) The Parties agree that a State or Federal statute, rule, regulation, or Federal guideline will prevail over the provisions of this Section unless the statute, rule, regulation, or guidelines can be read together with this Section to give effect to both.

(e) Damages.

(1) HHSC will be entitled to actual and consequential damages resulting from the CONTRACTOR’s failure to comply with any of the terms of the Agreement.

(2) In some cases, the actual damage to HHSC or the State of Texas as a result of CONTRACTOR’s failure to meet any aspect of the responsibilities of the Agreement or to meet specific performance standards set forth in the Agreement are difficult or impossible to determine with precise accuracy. Therefore, liquidated damages may be assessed in writing against and paid by the CONTRACTOR for failure to meet any aspect of the responsibilities of the Agreement or to meet the specific performance standards identified by the HHSC. Liquidated damages may be assessed if HHSC determines such failure is the fault of the CONTRACTOR (including the CONTRACTOR’s subcontractors or consultants) and is not materially caused or contributed to by HHSC or its agents. If at any time, HHSC determines the CONTRACTOR has not met any aspect of the responsibilities of the Agreement or the specific performance standards due to mitigating circumstances, HHSC reserves the right to waive all or part of the liquidated damages. All such waivers must be in writing, contain the reasons for the waiver, and be signed by the appropriate executive of HHSC.

(a) The liquidated damages prescribed in this Section are not intended to be in the nature of a penalty, but are intended to be reasonable estimates of HHSC’s projected financial loss and damage resulting from the CONTRACTOR’s nonperformance, including financial loss as a result of project delays. Accordingly, in the event CONTRACTOR fails to perform in accordance with the Agreement, HHSC may assess liquidated damages as provided in this Section.

(3) If CONTRACTOR fails to perform any of the Services described in the Agreement, HHSC may assess liquidated damages for each occurrence of a liquidated damages event, to the extent consistent with HHSC's tailored approach to remedies and Texas law.

(4) HHSC may elect to collect liquidated damages:

(A) Through direct assessment and demand for payment delivered to CONTRACTOR; or

(B) By deduction of amounts assessed as liquidated damages as set-off against payments then due to CONTRACTOR for the Services or Deliverables or that become due at any time after assessment of the liquidated damages. HHSC will make deductions until the full amount payable by the CONTRACTOR is received by the State.

(f) Equitable Remedies

(1) CONTRACTOR acknowledges that, if CONTRACTOR breaches (or attempts or threatens to breach) its obligation under the Agreement, the State will be irreparably harmed. In such a circumstance, HHSC may proceed directly to court.

(2) If a court of competent jurisdiction finds that CONTRACTOR breached (or attempted or threatened to breach) any such obligations, CONTRACTOR agrees that without any additional findings of irreparable injury or other conditions to injunctive relief, it will not oppose the entry of an appropriate order compelling performance by CONTRACTOR and restraining it from any further breaches (or attempted or threatened breaches).

(g) Suspension of Agreement

(1) HHSC may suspend performance of all or any part of the Agreement if:

(A) HHSC determines that CONTRACTOR has committed a material breach of the Agreement;

(B) HHSC has reason to believe that CONTRACTOR has committed, assisted in the commission of, or failed to take appropriate action concerning fraud, abuse, malfeasance, misfeasance, or nonfeasance by any party concerning the Agreement; or

(C) HHSC determines that suspension of the Agreement in whole or in part is convenient or in the best interests of the State of Texas or the HHSC Programs.

(2) HHSC will notify CONTRACTOR in writing of its intention to suspend the Agreement in whole or in part. Such notice will:

(A) Be delivered in writing to CONTRACTOR;

(B) Include a concise description of the facts or matter leading to HHSC’s decision; and

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(C) Unless HHSC is suspending the contract for convenience, request a Corrective Action Plan from CONTRACTOR or describe actions that CONTRACTOR must take to avoid the contemplated suspension of the Agreement.

Section 11.03 Termination of Agreement.

In addition to other provisions of this article allowing termination, the Agreement will terminate upon the expiration date unless extended in accordance with the terms of the Agreement, or terminated sooner under the terms of the Agreement. Prior to completion of the Initial Term and any extensions or renewal thereof, all or a part of the Agreement may be terminated for any of the following reasons:

(a) Termination by mutual agreement of the Parties.

The Agreement may be terminated by mutual agreement of the Parties. Such agreement must be in writing.

(b) Termination in the best interest of the State.

HHSC may terminate the Agreement at any time when, in its sole discretion, HHSC determines that termination is in the best interests of the State of Texas. The termination will be effective on the date specified in HHSC’s notice of termination.

(c) Termination for cause.

Except as otherwise provided by the U.S. Bankruptcy Code, or any successor law, HHSC may terminate the Agreement, in whole or in part, upon the following conditions:

(1) Assignment for the benefit of all or substantially all of its creditors, appointment of receiver, or inability to pay debts.

HHSC may terminate the Agreement if CONTRACTOR:

(A) Makes an assignment for the benefit of its creditors;

(B) Admits in writing its inability to pay its debts generally as they become due; or

(C) Consents to the appointment of a receiver, trustee, or liquidator of CONTRACTOR or of all or any part of its property.

(2) Failure to adhere to laws, rules, ordinances, or orders.

HHSC may terminate the Agreement if a court of competent jurisdiction finds CONTRACTOR failed to adhere to any laws, ordinances, rules, regulations or orders of any public authority having jurisdiction and such violation prevents or substantially impairs performance of CONTRACTOR’s duties under the Agreement.

(3) Breach of confidentiality.

HHSC may terminate the Agreement if CONTRACTOR breaches confidentiality obligations with respect to the Services and Deliverables provided under the Agreement.

(4) Failure to maintain adequate personnel or resources.

HHSC may terminate the Agreement if, after providing notice and an opportunity to correct, HHSC determines that CONTRACTOR has failed to supply personnel or resources and such failure results in CONTRACTOR’s inability to fulfill its duties under the Agreement.

(5) Termination for gifts and gratuities.

(A) HHSC may terminate the Agreement following the determination by a competent judicial or quasi-judicial authority and CONTRACTOR’s exhaustion of all legal remedies that CONTRACTOR, its employees, agents or representatives have either offered or given anything of value to an officer or employee of HHSC or the State of Texas in violation of state law.

(B) CONTRACTOR must include a similar provision in each of its subcontracts and will enforce this provision against a subcontractor who has offered or given anything of value to any of the persons or entities described in this Section, whether or not the offer or gift was in CONTRACTOR’s behalf.

(C) Termination of a subcontract by CONTRACTOR under this provision will not be a cause for termination of the Agreement unless:

(1) CONTRACTOR fails to replace such terminated subcontractor within a reasonable time.

(D) For purposes of this Section, a “thing of value” means any item of tangible or intangible property that has a monetary value of more than $50.00 and includes, but is not limited to, cash, food, lodging, entertainment, and charitable contributions. The term does not include contributions to holders of public office or candidates for public office that are paid and reported in accordance with State or Federal law.

(6) Termination for non-appropriation of funds.

Notwithstanding any other provision of the Agreement, if funds for the continued fulfillment of the Agreement by HHSC are at any time not forthcoming or are insufficient, through failure of any entity to appropriate funds or otherwise, then HHSC will have the right to terminate the Agreement at no additional

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cost and with no penalty whatsoever. HHSC will make best efforts to provide reasonable written advance notice to CONTRACTOR upon learning that funding for the Agreement may be discontinued.

(7) Termination for lack of financial viability.

HHSC may terminate the Agreement if, in its sole discretion, HHSC has a good faith belief that CONTRACTOR no longer maintains the financial viability required to complete the Services and Deliverables, or otherwise fully perform the Agreement.

(8) Judgment and execution.

(A) HHSC may terminate the Agreement if judgment for the payment of money in excess of $500,000.00 that is not covered by insurance, is rendered by any court or governmental body against CONTRACTOR, and CONTRACTOR does not:

(1) Discharge the judgment or provide for its discharge in accordance with the terms of the judgment;

(2) Procure a stay of execution of the judgment within 30 days from the date of entry thereof; or

(3) Perfect an appeal of such judgment and cause the execution of such judgment to be stayed during the appeal, providing such financial reserves as may be required under generally accepted accounting principles.

(B) If a writ or warrant of attachment or any similar process is issued by any court against all or any material portion of the property of CONTRACTOR, and such writ or warrant of attachment or any similar process is not released or bonded within 30 days after its entry, HHSC may terminate the Agreement in accordance with this Section.

(8) Termination for CONTRACTOR’s material breach of the Agreement.

HHSC will have the right to terminate the Agreement in whole or in part if HHSC determines, at its sole discretion, that CONTRACTOR has materially breached the Agreement.

Section 11.04 Effective date of termination.

Except as otherwise provided in the Agreement, termination will be effective as of the date specified in the notice of termination.

Section 11.05 Extension of termination effective date.

HHSC may extend the effective date of termination one or more times as it elects, in its sole discretion.

Section 11.06 Payment and other provisions at Agreement termination.

(a) If HHSC terminates the Agreement, HHSC will pay CONTRACTOR on the effective date of termination (or as soon as possible thereafter taking into account appropriation and fund accounting requirements) any undisputed amounts due for all completed, approved, and accepted Services or Deliverables.

(b) HHSC further agrees to negotiate in good faith with CONTRACTOR to equitably adjust and settle any accrued or outstanding liabilities for any unaccepted Service or deliverable and Change Order Requests that

(1) Is due or delivered prior to or upon contract termination;

(2) Is complete or substantially complete, or for which CONTRACTOR can document to the satisfaction of HHSC substantial progress; and

(3) Benefits HHSC or the State of Texas, notwithstanding its unaccepted status.

(c) CONTRACTOR must provide HHSC all reasonable access to records, facilities, and documentation as is required to efficiently and expeditiously close out the Services under the Agreement.

(d) CONTRACTOR must prepare a turnover plan, which is acceptable to and approved by HHSC. That turnover plan will be implemented during the time period between receipt of notice and the termination date.

Section 11.07 Modification of Agreement in the event of remedies.

HHSC may propose a modification of the Agreement in response to the imposition of a remedy under this article. Any modifications under this Section must be reasonable, limited to the matters causing the exercise of a remedy, within the scope of the Agreement, and in writing. CONTRACTOR must negotiate such proposed modifications in good faith.

Section 11.08 Turnover assistance.

Upon receipt of notice of termination of the Agreement by HHSC, CONTRACTOR will provide any turnover assistance reasonably necessary to enable HHSC or its designee to effectively close out the Agreement and move the work to another vendor or to perform the work by itself.

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Section 11.09 Rights upon termination or expiration of Agreement.

In the event that the Agreement is terminated for any reason, or upon its expiration, HHSC will, at HHSC's discretion, retain ownership of any and all associated work products, Deliverables or Documentation in whatever form that they exist.

Section 11.10 CONTRACTOR responsibility for associated costs.

If HHSC terminates the Agreement for Cause, the CONTRACTOR will be responsible to HHSC for all costs incurred by HHSC, the State of Texas, or any of its administrative agencies to replace the CONTRACTOR. These costs include, but are not limited to, the costs of procuring a substitute vendor and the cost of any claim or litigation that is reasonably attributable to CONTRACTOR’s failure to perform any Service in accordance with the terms of the Agreement

Section 11.11 Dispute resolution.

(a) General agreement of the Parties.

The Parties mutually agree that the interests of fairness, efficiency, and good business practices are best served when the Parties employ all reasonable and informal means to resolve any dispute under the Agreement. The Parties mutually commit to using all reasonable and informal means of resolving disputes prior to invoking a remedy provided elsewhere in this Article, unless HHSC immediately terminates the Agreement in accordance with the terms and conditions of the Agreement.

(b) Duty to negotiate in good faith.

Any dispute that in the judgment of any Party to the Agreement may materially or substantially affect the performance of any Party will be reduced to writing and delivered to the other Party within 10 business days. The Parties must then negotiate in good faith and use every reasonable effort to resolve the dispute and the Parties will not resort to any formal proceedings unless they have reasonably determined that a negotiated resolution is not possible and notified the other Party. The resolution of any dispute disposed of by agreement between the Parties will be reduced to writing and delivered to all Parties within 10 business days.

(c) Claims for breach of Agreement.

(1) General requirement. As required by Chapter 2260, Government Code, CONTRACTOR’s claim for breach of the Agreement must resolved in accordance with the dispute resolution process established by HHSC in accordance with Chapter 2260, Government Code.

(2) Negotiation of claims. The Parties agree that the CONTRACTOR’s claim for breach of the Agreement that the Parties cannot resolve in the ordinary course of business or through the use of all reasonable and informal means will be submitted to the negotiation process provided in Chapter 2260, Subchapter B, Government Code.

(A) To initiate the process, CONTRACTOR must submit written notice to HHSC that states that CONTRACTOR invokes the provisions of Chapter 2260, Subchapter B, Government Code. The notice must comply with the requirements of Title 1, Chapter 392, Subchapter B of the Texas Administrative Code.

(B) The Parties agree that the CONTRACTOR’s compliance with Chapter 2260, Subchapter B, Government Code, will be a condition precedent to the filing of a contested case proceeding under Chapter 2260, Subchapter C, of the Government Code.

(3) Contested case proceedings. The contested case process provided in Chapter 2260, Subchapter C, Government Code, will be CONTRACTOR’s sole and exclusive process for seeking a remedy for any and all alleged breaches of contract by HHSC if the Parties are unable to resolve their disputes under Subsection (c)(2) of this Section.

(A) The Parties agree that compliance with the contested case process provided in Chapter 2260, Subchapter C, Government Code, will be a condition precedent to seeking consent to sue from the Texas Legislature under Chapter 107, Civil Practices & Remedies Code. Neither the execution of the Agreement by HHSC nor any other conduct of any representative of HHSC relating to the Agreement will be considered a waiver of the State’s sovereign immunity to suit.

(4) HHSC rules. The submission, processing and resolution of CONTRACTOR’s claim is governed by the rules adopted by HHSC under Chapter 2260, Government Code, found at Title 1, Chapter 392, Subchapter B of the Texas Administrative Code.

(5) CONTRACTOR’s duty to perform. Neither the occurrence of an event constituting an alleged breach of contract nor the pending status of any claim for breach of contract is grounds for the suspension of performance, in whole or in part, by CONTRACTOR of any duty or obligation with respect to the performance of the Agreement. Any changes to the Agreement as a result of a Dispute Resolution will be implemented in accordance with Article 8, Amendments, Modifications and Change Order Requests.

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Section 11.12 Liability of CONTRACTOR.

(a) CONTRACTOR bears all risk of loss or damage due to:

(1) Defects in products, Services or Deliverables;

(2) Unfitness or obsolescence of products, Services or Deliverables; or

(3) The negligence or intentional misconduct of CONTRACTOR or its employees, agents, subcontractors, or representatives.

(b) CONTRACTOR MUST, AT THE CONTRACTOR’S OWN EXPENSE, DEFEND WITH COUNSEL APPROVED BY THE STATE, INDEMNIFY, AND HOLD HARMLESS THE STATE AND STATE EMPLOYEES, OFFICERS, DIRECTORS, CONTRACTORS AND AGENTS FROM AND AGAINST ANY LOSSES, LIABILITIES, DAMAGES, PENALTIES, COSTS, FEES, INCLUDING WITHOUT LIMITATION REASONABLE ATTORNEYS' FEES, AND EXPENSES FROM ANY CLAIM OR ACTION FOR PROPERTY DAMAGE, BODILY INJURY OR DEATH, TO THE EXTENT CAUSED BY OR ARISING FROM THE NEGLIGENCE OR INTENTIONAL MISCONDUCT OF THE CONTRACTOR AND ITS EMPLOYEES, OFFICERS, AGENTS, OR SUBCONTRACTORS.

(c) CONTRACTOR will not be liable to HHSC for any loss, damages or liabilities attributable to or arising from:

(1) The failure of HHSC or any state agency or HHSC CONTRACTOR to perform a service or activity in connection with the Agreement; or

(2) CONTRACTOR’s prudent and diligent performance of the Services in compliance with instructions given by HHSC in accordance with Section 1.03 (relating to implied authority) and Section 3.03 (relating to delegation of authority) of the Agreement.

(d) CONTRACTOR will ship all Equipment and Software purchased and Third Party Software licensed under the Agreement, freight prepaid, FOB HHSC’s destination. The method of shipment will be consistent with the nature of the Equipment and Software and hazards of transportation. Regardless of FOB point, CONTRACTOR agrees to bear all risks of loss, damage, or destruction of Deliverables, in whole or in part, ordered hereunder that occurs prior to Acceptance, except loss or damage attributable to HHSC’s fault or negligence; and such loss, damage, or destruction will not release CONTRACTOR from any obligation hereunder. After Acceptance, the risk of loss or damage will be borne by HHSC, except loss or damage attributable to CONTRACTOR’s fault or negligence.

Article 12. Assurances and Certifications

Section 12.01 Proposal certifications.

CONTRACTOR acknowledges its continuing obligation to comply with the requirements of any certifications contained in the Agreement, and will immediately notify HHSC of any changes in circumstances affecting those certifications.

Section 12.02 Conflicts of interest.

(a) Representation.

CONTRACTOR agrees to comply with applicable state and federal laws, rules, and regulations regarding conflicts of interest in the performance of its duties under the Agreement. CONTRACTOR warrants that it, its subcontractors, and employees, officers, directors and agents of Contractor and Contractor's subcontractors have no interest and will not acquire any direct or indirect interest that would conflict in any manner or degree with its performance under the Agreement.

(b) General duty regarding conflicts of interest.

CONTRACTOR will establish safeguards to prohibit employees from using their positions for a purpose that constitutes or presents the appearance of personal or organizational conflict of interest, or personal gain. CONTRACTOR will operate with complete independence and objectivity without actual, potential or apparent conflict of interest with respect to the activities conducted under the Agreement with the State of Texas.

Section 12.03 Organizational conflicts of interest.

(a) Definition. An organizational conflict of interest is a set of facts or circumstances, a relationship, or other situation under

which a contractor, or a subcontractor has past, present, or currently planned personal or financial activities or interests that either directly or indirectly:

(1) Impairs or diminishes the offeror’s, contractor’s, or subcontractor’s ability to render impartial or objective assistance or advice to HHSC; or

(2) Provides the contractor or subcontractor an unfair competitive advantage in future HHSC procurements. (b) Warranty.

Except as otherwise disclosed and approved by HHSC prior to the Effective Date of the Contract, CONTRACTOR warrants that, as of the Effective Date and to the best of its knowledge and belief, there are no relevant facts or circumstances that could give rise to organizational conflict of interest affecting the Agreement.

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CONTRACTOR affirms that it has neither given, nor intends to give, at any time hereafter, any economic opportunity, future employment, gift, loan, gratuity, special discount, trip, favor, or service to a public servant or any employee or representative of same, at any time during the procurement process or in connection with the procurement process except as allowed under relevant state and federal law. (c) Continuing duty to disclose.

(1) CONTRACTOR agrees that, if after the Effective Date, CONTRACTOR discovers is made aware of an organizational conflict of interest, CONTRACTOR will immediately and fully disclose such interest in writing to the HHSC project manager. In addition, CONTRACTOR must promptly disclose any relationship that might be perceived or represented as a conflict after its discovery by CONTRACTOR or by HHSC as a potential conflict. HHSC reserves the right to make a final determination regarding the existence of conflicts of interest, and CONTRACTOR agrees to abide by HHSC’s decision.

(2) The disclosure will include a description of the action(s) that CONTRACTOR has taken or proposes to take to avoid or mitigate such conflicts.

(d) Remedy. If HHSC determines that an organizational conflict of interest exists, HHSC may, at its discretion, terminate the

contract. If HHSC determines that CONTRACTOR was aware of an organizational conflict of interest before the award of the Agreement and did not disclose the conflict to the contracting officer, such nondisclosure will be considered a material breach of the Agreement. Furthermore, such breach may be submitted to the Office of the Attorney General, Texas Ethics Commission, or appropriate State or Federal law enforcement officials for further action. (e) Flow down obligation.

CONTRACTOR must include the provisions of this Section 12.03 in all subcontracts for work to be performed similar to the service provided by CONTRACTOR, and the terms "Agreement," "CONTRACTOR," and "project manager" modified appropriately to preserve the State's rights.

Section 12.04 HHSC personnel recruitment prohibition.

CONTRACTOR has not retained or promised to retain any person or company, or utilized or promised to utilize a consultant that participated in HHSC’s development of specific criteria of the Agreement or who participated in the selection of the CONTRACTOR for the Agreement.

CONTRACTOR will not recruit or employ any HHSC professional or technical personnel who have worked on projects relating to the subject matter of the Agreement, or who have had any influence on decisions affecting the subject matter of the Agreement, for two (2) years following the completion of the Agreement.

Section 12.05 Anti-kickback provision.

CONTRACTOR certifies that it will comply with the Anti-Kickback Act of 1986, 41 USC §51-58 and Federal Acquisition Regulation 52.203-7.

Section 12.06 Debt or back taxes owed to the State of Texas.

In accordance with Section 403.055 of the Government Code, CONTRACTOR agrees that any payments due to CONTRACTOR under the Agreement will be first applied toward any debt or back taxes CONTRACTOR owes the State of Texas. CONTRACTOR further agrees that payments will be so applied until such debts and back taxes are paid in full.

Section 12.07 Certification regarding status of license, certificate, or permit.

Article IX, Section 163 of the General Appropriations Act for the 1998/1999 state fiscal biennium prohibits an agency that receives an appropriation under either Article II or V of the General Appropriations Act from awarding an Agreement with the owner, operator, or administrator of a facility that has had a license, certificate, or permit revoked by another Article II or V agency. CONTRACTOR certifies it is not ineligible for an award under this provision.

Section 12.08 Outstanding debts and judgments.

CONTRACTOR certifies that it is not presently indebted to the State of Texas, and that CONTRACTOR is not subject to an outstanding judgment in a suit by the State of Texas against CONTRACTOR for collection of the balance. For purposes of this Section, an indebtedness is any amount sum of money that is due and owing to the State of Texas and is not currently under dispute. A false statement regarding CONTRACTOR’s status will be treated as a material breach of the Agreement and may be grounds for termination at the option of HHSC.

Section 12.09 Anti-trust.

In submitting a proposal, and in accepting the Contract or purchase order, Contractor certifies and agrees as follows:

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(1) Neither the CONTRACTOR, nor the person represented by the CONTRACTOR, nor any person acting for the represented person has:

(a) violated the antitrust laws codified by Chapter 15, Business & Commerce Code, or the federal antitrust laws; or

(b) directly or indirectly communicated the bid/offer associated with this contract to a competitor or other person engaged in the same line of business.

(2) CONTRACTOR assigns to HHSC all of CONTRACTOR’s rights, title, and interest in and to all claims and causes of action CONTRACTOR may have under the antitrust laws of Texas or the United States for overcharges associated with this contract.

Article 13. Representations and Warranties

Section 13.01 Authorization.

(a) The execution, delivery and performance of the Agreement has been duly authorized by CONTRACTOR and no approval, authorization or consent of any governmental or regulatory agency is required to be obtained in order for CONTRACTOR to enter into the Agreement and perform its obligations under the Agreement.

(b) CONTRACTOR has obtained and will maintain all licenses, certifications, permits, and authorizations necessary to perform the Services under the Agreement and currently is in good standing with all regulatory agencies that regulate any or all aspects of CONTRACTOR’s performance of the Agreement. CONTRACTOR will maintain all required certifications, licenses, permits, and authorizations to remain in good standing during the term of the Agreement.

Section 13.02 Ability to perform.

CONTRACTOR warrants that it has the financial resources to fund the capital expenditures required under the Agreement without advances by HHSC or assignment of any payments by HHSC to a financing source.

Section 13.03 Workmanship and performance.

(a) All Services and Deliverables provided under the Agreement will be provided in a manner consistent with the standards of quality and integrity as outlined in the Agreement, the Solicitation, and CONTRACTOR’s Proposal.

(b) All Services and Deliverables must meet or exceed the required levels of performance specified in or under the Agreement, and will meet or exceed HHSC’s Missions and Objectives, as set forth in the Solicitation.

(c) CONTRACTOR will perform the Services in a workmanlike manner, in accordance with best practices and high professional standards used in well-managed operations performing services similar to the services described in the Agreement.

Section 13.04 Warranty of deliverables.

CONTRACTOR warrants that Deliverables developed and delivered under the Agreement will meet the specifications as described in the Agreement during the period following its acceptance by HHSC, through the term of the Agreement, including any extensions as provided in the Agreement, that are subsequently negotiated by CONTRACTOR and HHSC. CONTRACTOR will promptly repair or replace any such Deliverables not in compliance with this warranty at no charge to HHSC.

Section 13.05 Manufacturers’ warranties.

CONTRACTOR assigns to HHSC all of the manufacturers’ warranties and indemnities relating to all products, including without limitation, Third Party Software to the extent CONTRACTOR is permitted by the manufacturers to make such assignments to HHSC. Such assignment is subject to all of the terms and conditions imposed by the manufacturers with respect thereto.

Section 13.06 Compliance with Agreement.

CONTRACTOR will not take any action substantially or materially inconsistent with any of the terms and conditions set forth in the Agreement without the written approval of HHSC.

Article 14. Intellectual Property

Section 14.01 Infringement and misappropriation.

(a) CONTRACTOR warrants that all Deliverables provided by CONTRACTOR will not infringe or misappropriate any right of, and will be free of any claim of, any third person or entity based on copyright, patent, trade secret, or other intellectual property rights.

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(b) CONTRACTOR WILL, AT ITS EXPENSE, DEFEND WITH COUNSEL APPROVED BY HHSC, INDEMNIFY, AND HOLD HARMLESS HHSC, ITS EMPLOYEES, OFFICERS, DIRECTORS, CONTRACTORS, AND AGENTS FROM AND AGAINST ANY LOSSES, LIABILITIES, DAMAGES, PENALTIES, COSTS, FEES, INCLUDING WITHOUT LIMITATION REASONABLE ATTORNEYS’ FEES AND EXPENSES, FROM ANY CLAIM OR ACTION AGAINST HHSC THAT IS BASED ON A CLAIM OF BREACH OF THE WARRANTY SET FORTH IN THE PRECEDING PARAGRAPH. HHSC WILL PROMPTLY NOTIFY CONTRACTOR IN WRITING OF THE CLAIM, PROVIDE CONTRACTOR A COPY OF ALL INFORMATION RECEIVED BY HHSC WITH RESPECT TO THE CLAIM, AND COOPERATE WITH CONTRACTOR IN DEFENDING OR SETTLING THE CLAIM.

(c) In case the Deliverables, or any one or part thereof, is in such action held to constitute an infringement or misappropriation, or the use thereof is enjoined or restricted or if a proceeding appears to CONTRACTOR to be likely to be brought, CONTRACTOR will, at its own expense, either:

(1) Procure for HHSC the right to continue using the Deliverables; or

(2) Modify or replace the Deliverables to comply with the Specifications and to not violate any intellectual property rights.

If neither of the alternatives set forth in (1) or (2) above are available to the CONTRACTOR on commercially reasonable terms, CONTRACTOR may require that HHSC return the allegedly infringing Deliverable(s) in which case CONTRACTOR will refund all amounts paid for all such Deliverables and reimburse HHSC for any related direct and indirect damages incurred by HHSC due to the infringing Deliverable(s).

Section 14.02 Exceptions.

CONTRACTOR is not responsible for any claimed breaches of the warranties set forth in Section 14.01 to the extent caused by:

(a) Modifications made to the item in question by anyone other than CONTRACTOR or its subcontractors or HHSC or its Contractors working at CONTRACTOR’s direction or in accordance with the specifications; or

(b) The combination, operation, or use of the item with other items if CONTRACTOR did not supply or approve for use with the item; or

(c) HHSC’s failure to use any new or corrected versions of the item made available by CONTRACTOR.

Article 15. Liability

Section 15.01 Property damage.

(a) CONTRACTOR will protect HHSC’s real and personal property from damage arising from CONTRACTOR’s, its agent’s, employees’ and subcontractors’ performance of the Agreement, and CONTRACTOR will be responsible for any loss, destruction, or damage to HHSC’s property that results from or is caused by CONTRACTOR’s, its agents’, employees’ or subcontractors’ negligent or wrongful acts or omissions. Upon the loss of, destruction of, or damage to any property of HHSC, CONTRACTOR will notify the HHSC Project Manager thereof and, subject to direction from the Project Manager or her or his designee, will take all reasonable steps to protect that property from further damage.

(b) CONTRACTOR agrees to observe and require its employees and agents to observe safety measures and proper operating procedures at HHSC sites at all times.

(c) CONTRACTOR will distribute a policy statement to all of its employees and agents that directs the employee or agent to immediately report to HHSC or to CONTRACTOR any special defect or unsafe condition encountered while on HHSC premises. CONTRACTOR will immediately report to HHSC any special defect or an unsafe condition it encounters or otherwise learns about.

Section 15.02 Risk of Loss.

During the period Deliverables are in transit and in possession of CONTRACTOR, its carriers or HHSC prior to being accepted by HHSC, CONTRACTOR will bear the risk of loss or damage thereto, unless such loss or damage is caused by the negligence or intentional misconduct of HHSC. After HHSC accepts a Deliverable, the risk of loss or damage to the Deliverable will be borne by HHSC, except loss or damage attributable to the negligence or intentional misconduct of CONTRACTOR’s agents, employees or subcontractors.

Section 15.03 Limitation of HHSC’s Liability.

HHSC WILL NOT BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, OR CONSEQUENTIAL DAMAGES UNDER CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHER LEGAL THEORY. THIS WILL APPLY REGARDLESS OF THE CAUSE OF ACTION AND EVEN IF HHSC HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

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HHSC’S LIABILITY TO CONTRACTOR UNDER THE AGREEMENT WILL NOT EXCEED THE TOTAL CHARGES TO BE PAID BY HHSC TO CONTRACTOR UNDER THE AGREEMENT, INCLUDING CHANGE ORDER REQUEST PRICES AGREED TO BY THE PARTIES OR OTHERWISE ADJUDICATED.

Article 16. Special Terms and Conditions

Section 16.01 HHSC Data Use Agreement Not Required The HHSC Data Use Agreement is not required to be incorporated into the Agreement because:

CONTRACTOR does not Access Confidential Information; or

CONTRACTOR accesses Other Confidential Information as defined in the Agreement and CONTRACTOR agrees:

CONTRACTOR and all subcontractors, consultants, or agents under the Agreement will treat all information that is obtained through performance of the Services under the Agreement, including, but not limited to, information relating to applicants or recipients of HHSC Programs as Other Confidential Information to the extent that such information is considered Other Confidential Information in the Agreement.

(a) CONTRACTOR is responsible for understanding the degree to which information obtained through performance of the Agreement is confidential under state and federal law, regulations, or administrative rules as applicable.

(b) CONTRACTOR and all subcontractors, consultants, or agents under the Agreement will not use any information obtained through performance of the Agreement in any manner except as is necessary to the proper discharge of obligations and securing of rights under the Agreement.

(c) CONTRACTOR will have a system in effect to protect all records, documents, or Other Confidential Information under the Agreement that is obtained or maintained in connection with the activities funded under the Agreement. Any disclosure or transfer of Other Confidential Information by CONTRACTOR, including information required by HHSC, will be in accordance with the Agreement. If the CONTRACTOR receives a request for information deemed Other Confidential Information under the Agreement, CONTRACTOR will immediately notify the State of the request, and will make reasonable efforts to protect the information from public disclosure until further instructed by HHSC.

(d) In addition to the requirements stated in this Section, CONTRACTOR must comply with any policy, rule, or reasonable requirement of HHSC that relates to the safeguarding or disclosure of Other Confidential Information relating to HHSC Programs recipients, CONTRACTOR’S operations, or the CONTRACTOR performance of the Agreement.

(e) Upon expiration of the Agreement, or termination of the Agreement for any reason, all Other Confidential Information of a Party disclosed to, and all copies made by the other Party, will be returned to the disclosing Party or, at the disclosing Party’s option, erased or destroyed, subject to laws governing the destruction of public information. The recipient of the Other Confidential Information must provide the disclosing Party certificates evidencing this erasure or destruction.

(f) CONTRACTOR will immediately report to HHSC any and all unauthorized disclosures or uses of Other Confidential Information upon it or its subcontractor(s), consultant(s), or agent(s) becoming aware or acquiring knowledge of the disclosure. CONTRACTOR acknowledges that any publication or disclosure of Other Confidential Information may cause immediate and irreparable harm to HHSC and may constitute a violation of State or federal laws. If CONTRACTOR, its subcontractor(s), consultant(s), or agent(s) should publish or disclose such Other Confidential Information to others without authorization, HHSC will immediately be entitled to injunctive relief or any other remedies to which it is entitled under law or equity without requiring a cure period as described in Article 11. HHSC will have the right to recover from CONTRACTOR all damages and liabilities caused by or arising from Contractor’s, its subcontractors’, consultants’, or agents’ failure to protect HHSC’s Confidential Information. CONTRACTOR WILL DEFEND WITH COUNSEL APPROVED BY HHSC, INDEMNIFY AND HOLD HARMLESS HHSC FROM ALL DAMAGES, COSTS, LIABILITIES, AND EXPENSES (INCLUDING WITHOUT LIMITATION REASONABLE ATTORNEYS’ FEES AND COSTS) CAUSED BY OR ARISING FROM CONTRACTOR’S OR ITS SUBCONTRACTORS’, CONSULTANTS’ OR AGENTS’ FAILURE TO PROTECT OTHER CONFIDENTIAL INFORMATION.

(g) CONTRACTOR will require its subcontractor(s), consultant(s), and agent(s) to comply with the terms of this provision.

(h) The obligations in this Section do not restrict any disclosure by a Party under any applicable law, or by order of any court or government agency, provided that the disclosing Party must give prompt notice to the non-disclosing Party of such order.

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(i) With the exception of HHSC Program recipient or client information, Other Confidential Information of a Party will not be afforded the protection of the Agreement if this data was:

(1) Already known to the receiving Party without restrictions at the time of its disclosure by the furnishing Party;

(2) Independently developed by the receiving Party without reference to the furnishing Party’s confidential Information;

(3) Rightfully obtained by the other Party without restriction from a third party after its disclosure by the furnishing Party;

(4) Publicly available other than through the fault or negligence of the other Party; or

(5) Released without restriction to anyone.

Section 16.02 Financial/performance audits.

(a) Texas Health and Safety Code Section 12.0123 directs HHSC to contract with an independent auditor to perform annual independent external financial and performance audits of any Medicaid contractor used by HHSC in HHSC’s operation of a part of the State Medicaid program. “Medicaid contractor” means an entity that, under a contract with or otherwise on behalf of HHSC, performs one or more administrative services in relation to HHSC’s operation of a part of the State Medicaid program, such as claims processing, utilization review, client enrollment, provider enrollment, quality monitoring, or payment of claims. The independent auditor will deliver to the CONTRACTOR and to HHSC a report of the findings and recommendations within 30 calendar days of the close of each audit. The report will be prepared in accordance with generally accepted auditing standards.

(b) CONTRACTOR agrees to deliver to HHSC, for HHSC’s approval, a Corrective Action Plan that addresses deficiencies identified in the audit within 30 calendar days of the delivery of the independent auditor’s report.

(c) CONTRACTOR understands that the independent auditor (“the auditor”) will make specific inquiries of CONTRACTOR’s management for information, including but not limited to information concerning the representations embodied in the financial statements and reports CONTRACTOR is required to furnish the State as per any financial report requirements in the Agreement. CONTRACTOR understands that as part of the auditor’s audit procedures, the auditor will request, and CONTRACTOR’s management will provide to the auditor a representation letter;

(1) Acknowledging management’s responsibility for the preparation of the financial statements and reports;

(2) Acknowledging management’s responsibility for compliance with laws and regulations; and

(3) Affirming management’s belief that the effects of any uncorrected financial statement or report misstatements aggregated by the auditor during the current audit engagement and pertaining to the period presented are immaterial, both individually and in the aggregate, to the financial statements and reports taken as a whole.

(d) CONTRACTOR understands and agrees that the auditor will also request that CONTRACTOR’s management confirm certain representations made to the auditor during the audit. The responses to those inquiries, and the related written representations of management required by generally accepted auditing standards, are part of the evidential matter that the auditor will rely on in forming its opinion on the CONTRACTOR’s financial statements and reports.

Section 16.03 Audit software.

As part of the Services, CONTRACTOR must operate and maintain audit software that HHSC or its designees may provide to CONTRACTOR from time to time during the Term of the Agreement.

Section 16.04 Ownership and licenses.

(a) Custom software.

The Parties agree that any Deliverable, including any software, developed by CONTRACTOR in connection with the Agreement (the “Custom Software”), will be the exclusive property of HHSC.

(b) Ownership rights.

(1) HHSC will own all right, title, and interest in and to its Confidential Information and the Deliverables provided by CONTRACTOR, including without limitation the specifications, a work pan, and the Custom Software, except that the Deliverables will not include the third party software and the associated Documentation for purposes of this Section. CONTRACTOR will take all actions necessary and transfer ownership of the Deliverables to HHSC,

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including the Custom Software and associated Documentation on final acceptance or as otherwise provided in the Agreement.

(2) CONTRACTOR will furnish Custom Software and Documentation, upon request of HHSC, in accordance with applicable State law. All Deliverables, in whole and in part, will be deemed works made for hire of HHSC for all purposes of copyright law, and copyright will belong solely to HHSC. To the extent that any Deliverable under this Section does not qualify as a work for hire under applicable law, and to the extent that the Deliverable includes materials subject to copyright, patent, trade secret, or other proprietary right protection, CONTRACTOR assigns all right, title, and interest in and to Deliverables, including all copyrights, inventions, patents, trade secrets, and other proprietary rights in the Deliverables (including any proprietary right renewals) to HHSC.

(3) CONTRACTOR will, at the expense of HHSC, assist HHSC or its designees to obtain copyrights, trademarks, or patents for all such Deliverables in the United States and any other countries. CONTRACTOR agrees to execute all papers and to give all facts known to it necessary to secure United States or foreign country copyrights and patents, and to transfer or cause to transfer to HHSC all the right, title, and interest in and to such Deliverables. CONTRACTOR also agrees not to assert any moral rights under applicable copyright law with regard to such Deliverables. (c) License Rights

HHSC will have ownership and unlimited rights to use, disclose, duplicate, or publish all information and data developed, derived, documented, or furnished by CONTRACTOR under or resulting from the Agreement. Such data will include all results, technical information, and materials developed for or obtained by HHSC from CONTRACTOR in the performance of the Services hereunder, including but not limited to all reports, surveys, plans, charts, recordings (video or sound), pictures, drawings, analyses, source and object code, graphic representations, computer programs and printouts, notes and memoranda, and documents whether finished or unfinished, which result from or are prepared in connection with the Services performed as a result of the Agreement.

(d) Proprietary Notices

CONTRACTOR will reproduce and include HHSC’s copyright and other proprietary notices and product identifications provided by CONTRACTOR on such copies, in whole or in part, or on any form of the Deliverables.

(e) Third Party Software and Documentation Licenses

(1) CONTRACTOR grants HHSC a non-exclusive, perpetual, license for HHSC to use the Third Party Software and its associated Documentation for its internal business purposes. HHSC will be entitled to use the Third Party Software on the Equipment or any replacement equipment used by HHSC, and with any replacement Third Party Software chosen by HHSC, without additional Charges. Terms in any licenses for Third Party Software will be consistent with the requirements of this Section.

(2) The licenses hereunder are granted as of the date when such Third Party Software is installed and certified by CONTRACTOR as operational, and the licenses will continue until HHSC permanently discontinues the use of the Third Party Software.

(3) Prior to utilizing any Third Party Software product that may be included as part of a Software Deliverable to HHSC, CONTRACTOR will provide to HHSC copies of the license agreement from the licensor of the Third Party Software to allow HHSC to pre-approve the license agreement that must, at a minimum, provide HHSC with necessary rights consistent with the short and long-term goals of the Agreement. CONTRACTOR will assign to HHSC the licenses for the Third Party Software upon Final Acceptance.

(4) CONTRACTOR will, during the project, maintain any and all Third Party Software products at their most current version or no more than one version back from the most current version. However, CONTRACTOR will not maintain any Third Party Software versions, including one version back, if any such version would prevent HHSC from using any functions, in whole or in part, or would cause deficiencies in the system.

(f) State and Federal Governments

In accordance with 45 C.F.R. Part 95.617, all appropriate State and Federal agencies will have a royalty-free, nonexclusive, and irrevocable license to reproduce, publish, translate, or otherwise use, and to authorize others to use for Federal Government purposes all materials, the Custom Software and modifications thereof, and associated documentation designed, developed, or installed with Federal Financial Participation under the Agreement, including but not limited to those materials covered by copyright, all Software source and object code, instructions, files, and Documentation composing the System.

Section 16.05 Insurance Coverage.

(a) Required Coverage.

(1) CONTRACTOR will procure, at CONTRACTOR’s own expense, during the Term of the Agreement and until final acceptance of all Services and Deliverables, the following insurance coverage. CONTRACTOR will

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provide HHSC with proof of the following insurance coverage within 10 calendar days after the Agreement is awarded upon HHSC’s request:

(A) Standard Worker's Compensation Insurance coverage;

(B) Automobile Liability; and

(C) Commercial General Liability Insurance including Bodily Injury coverage of $100,000.00 per each occurrence and Property Damage Coverage of $25,000.00 per each occurrence. (2) If CONTRACTOR’s current Commercial General Liability insurance coverage does not meet the above

stated requirements, CONTRACTOR will obtain excess liability insurance to compensate for the difference in the coverage amounts prior to effective date of the Agreement.

(3) CONTRACTOR is responsible for all deductibles stated in the policies. Insurance will be maintained at all times during the performance of the Agreement. Insurance coverage will be issued by insurance companies with “A” rating from Best that are authorized by applicable law to conduct business and provide the required coverage in the State of Texas, and must name HHSC as an additional insured.

(4) The policy will have an extended reporting period of two years. When policies are renewed or replaced, the policy retroactive date must coincide with, or precede, start of work on the Agreement.

(b) Proof of Insurance Coverage

(1) CONTRACTOR will furnish the HHSC Project Manager original Certificates of Insurance evidencing the required coverage to be in force on the date of award, and renewal certificates of insurance, or such similar evidence, if the coverages have an expiration or renewal date occurring during the term of the Agreement. The failure of HHSC to obtain this evidence from CONTRACTOR before permitting CONTRACTOR to commence work will not be deemed to be a waiver by HHSC and CONTRACTOR will remain under continuing obligation to maintain and provide proof of the insurance coverage.

(2) The insurance specified above will be carried until all services required to be performed under the terms of the Agreement are satisfactorily completed. Failure to carry or keep such insurance in force will constitute a violation of the Agreement, and HHSC maintains the right to stop work until proper evidence of insurance is provided.

(3) The insurance will provide for 30 calendar days prior written Notice to be given to HHSC in the event coverage is substantially changed, canceled, or non-renewed. CONTRACTOR must submit a new coverage binder to HHSC to ensure no break in coverage.

(4) CONTRACTOR will require all subcontractors operating in Texas to carry the same or more coverage as CONTRACTOR is required to carry under the Agreement. CONTRACTOR may provide the coverage for any subcontractor, and, if provided, the evidence of insurance submitted will so stipulate.

(5) The Parties understand and agree that any insurance coverages and limits furnished by CONTRACTOR will in no way expand or limit CONTRACTOR’s liabilities and responsibilities specified within the Contract documents or by applicable law.

(6) CONTRACTOR and each subcontractor will require that insurer will waive their rights of subrogation against HHSC.

(7) CONTRACTOR understands and agrees that any insurance maintained by HHSC will apply in excess of and not contribute with insurance provided by CONTRACTOR under the Agreement.

(8) If CONTRACTOR, or its subcontractor(s), desire additional coverage, higher limits of liability, or other modifications for its own protection, CONTRACTOR and each of its subcontractors will be responsible for the acquisition and cost of this additional protection at no additional cost to HHSC.

(9) CONTRACTOR may not transport a client or conduct any other official business on behalf of HHSC without the required coverage of the Agreement. CONTRACTOR agrees and understands that HHSC will not be liable for any accident or death due to an automobile accident involving the CONTRACTOR or CONTRACTOR’s employee, even if the accident or death occurs in the course of performing any work under the Agreement. Failure to meet this provision may be considered a material breach of the Agreement.

Section 16.06 Background Checks.

CONTRACTOR must obtain a criminal background check, including fingerprints in a form and of a quality acceptable to the Department of Public Safety and the Federal Bureau of Investigation, on any Contractor's employees or agents, including Subcontractors and Subcontractor employees or agents, who would be placed in direct contact with a resident or client.

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CONTRACTOR must also perform checks against the Nurse Aide Registry and the Employee Misconduct Registry maintained on DADS’ Employability Status Check Search website. CONTRACTOR must perform any criminal background checks at its expense and should limit its search to the United States of America.

CONTRACTOR will not utilize an employee, Subcontractor, or Subcontractor's employee to perform a site visit or have any contact with stakeholders, patients, residents, or their family members if: (a) CONTRACTOR determines, as a result of a criminal background check, that the person has been convicted of an offense listed in Tex. Health & Safety Code § 250.006 that bars employment or if the Consultant makes a reasonable determination that a conviction may pose a risk to any stakeholders, patients, residents, or their family members; or (b) the employee or Subcontractor or Subcontractor's employee is listed in the Nurse Aide Registry or the Employee Misconduct Registry.

Section 16.07 Historically Underutilized Business Participation Requirements

This Subsection applies if HHSC determined that sub-contracting opportunities were probable for the procurement/contract.

(a) Definitions.

For purposes of this Section:

(1) “Historically Underutilized Business” or “HUB” means a minority or women-owned business as defined by Texas Government Code, Chapter 2161.

(2) “HSP” means a HUB Subcontracting Plan.

(b) HUB Requirements.

(1) Contractor must submit an HSP for HHSC’s approval.

(2) Contractor must report to HHSC’s contract manager and HUB Office monthly, in the format required by the HUB Office, its use of HUB subcontractors to fulfill the subcontracting opportunities identified in the HSP.

(3) If the Parties amend the Agreement to include additional funds or a change to the Scope of Work, the Contractor must submit a revised HSP to the HHSC HUB Office, when a determination is made for additional subcontracting opportunities. All proposed changes to the HSP must comply with the requirements of Section 16.07(b)(4).

(4) Contractor must obtain prior written approval from the HHSC HUB Office before making any changes to the HSP. The proposed changes must comply with HHSC’s good faith effort requirements relating to the development and submission of HSPs.

(5) HHSC will determine if the value of Subcontracts to HUBs meet or exceed the HUB subcontracting provisions specified in the Contractor's HSP. If HHSC determines that the Contractor's subcontracting activity does not demonstrate a good faith effort, the Contractor may be subject to provisions in the Vendor Performance and Debarment Program (34 Tex. Admin. Code Chapter 20, Subchapter C), and subject to remedies for Breach.

Motions 9. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Judge Cuellar

SUBJECTConfirming the recommendation by Judge Cuellar to appoint Elizabeth Martinez asAssociate Municipal Court Judge.


BACKGROUNDIn accordance with City Charter Section 5.02.


STAFF RECOMMENDATIONN/A


Initiated By: Jesus Olivares, City Manager Staff Source: Osbaldo Guzman, Parks & Leisure Director and Miguel Pescador,

Purchasing Agent

SUBJECTConsideration to reject all bids for contract FY16-018 for the purchase and installation ofSolar Lighting for Pathway for Bartlett Soccer Complex. These bids received wereevaluated and rejected by staff as most were found to be incomplete and others farexceeded the estimated costs. Funding is available in the 2008 C.O.



BACKGROUNDThe City solicited and received eleven bids for the purchase and installation of a SolarLighting for Pathway for Bartlett Soccer Complex. Bids were reviewed based onrequired bid specifications; These bids received were evaluated and rejected by staff asmost were fund to be incomplete and other far exceeded the estimated costs.

Bid Summary Total CostHunter Knepshield $ 221,065.00 Meets specificationsCastillo Electric $ 228,298.00 Incomplete BidCastillo Electric $ 248,298.00 Incomplete BidUrban Solar $ 333,000.00 Meets specificationsDavila construction $ 544,500.00 Meets specificationsSouth Coast Solar $ 179,530.00 Incomplete BidAD/DC $ 350,000.00 Incomplete BidSmart Renaway $ 179,530.00 Incomplete BidMGC Electric $ 39,600.00 Incomplete BidLED Electric $ 290,000.00 Incomplete BidAyala Construction $ 273,508.00 Incomplete BidCantu Electric $ 300,541.40 Incomplete Bid


STAFF RECOMMENDATIONStaff recommends approval of this motion.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: 2008 C.O.Account #: 463-9822-535-9659Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:


Initiated By: Jesus Olivares, City Manager Staff Source: Osbaldo Guzman, Parks & Leisure Director and Miguel Pescador,

Purchasing Agent

SUBJECTConsideration to award purchase contract to Hunter Knepshield, Plano, Texas in theamount not to exceed $67,122.00. This contract is through BuyBoard CooperativePurchase Contract and is for the purchase of LED Light Fixtures and Poles to beinstalled at Bartlett Soccer Complex. Funding is available in the 2008 C.O.


PREVIOUS COUNCIL ACTIONThe City of Laredo is a member of BuyBoard Cooperative Purchasing Program.

BACKGROUND

This purchase contract to Hunter Knepshield, Plano, Texas in the amount not to exceed$67,122.00. This contract is through BuyBoard Cooperative Purchase Contract and isfor the purchase of LED Light Fixtures and Poles to be installed at Bartlett SoccerComplex. The City solicited and received eleven bids for the purchase and installation ofa Solar Lighting for Pathway for Bartlett Soccer Complex. Bids were reviewed andrejected based on required bids not meeting specifications.


STAFF RECOMMENDATIONIt is recommended that this contract be awarded.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: 2008 C.O.

Account #: 463-9822-535-9659Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

Resolutions 12. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Horacio De Leon, Assistant City Manager Staff Source: Ramon Chavez, Building Development Services Director

SUBJECT2016-R-09 Consideration to grant fee waivers and a Tax Abatement Agreementbetween the City of Laredo and B & G’s, LLC for the residential property located at 801Fremont St., being Lot 1 Block 268 Eastern Division. The proposed residential propertyeligible for property tax abatement includes the new construction of a 1,279 sq. ft.structure in the total amount of $54,783.63 which is equal to or in excess of 20% of theBase Value of the property in accordance with authorized guidelines and criteriaestablished for the Neighborhood Empowerment Zone (NEZ). This agreement will be fora five (5) year period and will consist of an estimated annual tax abatement total of$281.95 and estimated total fee waiver of $681.00 based on capital investment for thepurpose of economic development. Guidelines and criteria for the agreement are setforth in the attached agreement and information.

PREVIOUS COUNCIL ACTIONApproval of Resolution 2015-R-95 on October 19, 2015 creating the NeighborhoodEmpowerment Zone (NEZ) and outlined the potential incentives for projects locatedwithin the NEZ and the guidelines for approval process.

BACKGROUNDThe City of Laredo created the NEZ Program to improve City Council Districts III and VIIIby encouraging private investment in housing, businesses, and services in NEZ areas.The NEZ Program is the vehicle by which incentives such as building permit fee waiversand municipal property tax abatements may be granted to homeowners,investor-owners, and developers proposing new construction projects or rehabilitationprojects that are located within the NEZ area. B & G’s, LLC is proposing a residentialproject located at 801 Fremont St., being Lot 1 Block 268 Eastern Division. Theresidential project will consists of a new construction of a 1,279 sq. ft. structure. Theestimated capital investment of the residential project is $54,783.63. The project islocated within the NEZ District III and meets the zoning requirements as established bythe NEZ criteria. The City of Laredo would waive associated fees for the followingpermits: Building Permit, Plan Review, Plumbing, Electrical, Mechanical, Fire,Right-of-Way (curb and street cut), Water Permit, and Sprinkler System Fees.


STAFF RECOMMENDATIONStaff recommends that City Council approve this resolution.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Based on the above representations the estimated fee waivers by the City of Laredowill approximately total $681.00 and estimated five (5) year total tax abatement isanticipated to be $1,409.79

Attachments2016-R-09 Resolution2016-R-09 Tax Agreement

RESOLUTION NO. 2016-R-09

Consideration to grant fee waivers and a tax abatement agreement between the City of Laredo and B & G’s, LLC for the residential property located at 801 Fremont St., being Lot 1 Block 268 Eastern Division. The proposed residential property eligible for property tax abatement include the new construction of a 1,279 sq. ft. structure in the total amount of $54,783.63 which is equal to or in excess of 20% of the Base Value of the property in accordance with authorized guidelines and criteria established for the Neighborhood Empowerment Zone (NEZ). This agreement will be for a five (5) year period and will consist of an estimated annual tax abatement total of $281.95 and estimated total fee waiver of $681.00 based on capital investment for the purpose of economic development. Guidelines and criteria for the agreement are set forth in the attached agreement and information.

WHEREAS, the City of Laredo has previously approved Resolution No. 2015-R-95, creating the Neighborhood Empowerment Zone (NEZ) which outlined potential incentives for projects located within the NEZ and the guidelines for approval process.

WHEREAS, B & G’s, LLC is proposing a residential project located at 801 Fremont St., being Lot 1, Block 268 Eastern Division within the NEZ District III, that meets the required criteria;

WHEREAS, the project is eligible for fee waivers and tax abatement;

NOW THEREFORE BE IT RESOLVED, by the City Council of the City of Laredo that:

The residential project located at 801 Fremont St. is hereby approved for fee waivers, which will approximately total $681.00 and tax abatement, which will approximately total $281.95 annually, in accordance with authorized guidelines and criteria established for the Neighborhood Empowerment Zone.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR on this ____ day of ___________, 2016.

BY: _________________________

PETE SAENZ

MAYOR

ATTEST:

____________________________

DOANH “ZONE” T. NGUYEN

ACTING CITY SECRETARY


____________________________

BY: RAUL CASSO

CITY ATTORNEY

____________________________

BY: KRISTINA LAUREL HALE

FIRST ASSITANT CITY ATTORNEY

TAX ABATEMENT AND INCENTIVE AGREEMENT FOR PROPERTY IN A NEIGHBORHOOD EMPOWERMENT ZONE

This Agreement is made and entered into by and between B & G’s, LLC duly authorized totransact business in Texas, and the City of Laredo, a Municipal Corporation and a home-rule city in Webb County, Texas, (the “City”), pursuant to the authority of Chapters 318 and 378 of the Texas Local Government Code, and shall be effective when duly executed by signature of the authorized representative and City (“Effective Date”).

RECITALS

WHEREAS, the City of Laredo pursuant to the provisions of Chapters 312 and 378 of the Local Government Code of the State of Texas, known as the “Neighborhood Empowerment Zone,” has designated an area as an empowerment zone, thereby making the area eligible as a reinvestment zone for tax abatement under Section 312.002 of the Tax Code; and

WHEREAS, B & G’s, LLC are the owners of the land located within said reinvestment zone and described as 801 Fremont St., being Lot 1, Block 268 Eastern Division (“Property”) which exhibit is incorporated herein by reference for all purposes; and

WHEREAS, the City desires to promote and encourage the development of the community and the expansion and growth of the Property;

NOW THEREFORE, for and in consideration of the mutual covenants and agreements herein contained, the City and B & G’s, LLC have this day entered into the following contract and agreement:

I. TERM. This agreement shall be for a period of five (5) years becoming effective on January 1st of the year following the year in which a Certificate of Occupancy is issued.

II. OWNER COVENANTS

A. Project

B & G’s, LLC shall cause to be a residential project at 801 Fremont St., being Lot 1, Block 268 Eastern Division that consists of the new construction of a 1,279 sq. ft. structure with an estimated value of at least $54,783.63 and B & G’s, LLC agree to limit the use of the property described herein for said Residential District use as that term is defined in the Zoning Ordinance of the City of Laredo and in accordance with City of Laredo Resolution 2016-R-09.

B. Completion Date

B & G’s, LLC certifies that the residential project construction will be completed within one year from the issuance and receipt of the building permit, unless delayed because of force majeure, in which case the one year shall be extended by the number of days comprising the specific force majeure. For purposes of this Agreement, force majeure shall mean an event beyond B & G’s, LLC’s reasonable control as determined by the City of Laredo in its sole discretion, which shall not be unreasonably withheld, including, without limitation, delays caused by adverse weather, delays

in receipt of any required permits or approvals from any governmental authority, acts of God, or fires. Force majeure shall not include construction delays caused due to purely financial matters, such as, without limitation, delays in the obtaining of adequate financing.

C. Use of Property

B & G’s, LLC covenant that the project shall be constructed in a manner that is consistent with the general purposes of encouraging development or redevelopment of the Zone and shall be continuously used as Residential Property.

III. TAX ABATEMENT

Subject to and in accordance with this Agreement, the City hereby grant to B & G’s, LLC a real property tax abatement of City of Laredo imposed taxes on the Property for a period of five (5)years. The estimated amount of the Abatement granted under this Agreement shall be approximately $1,409.79. The total certified Base Value for the year 2015 as determined by the Webb County Appraisal District is $10,520.00.

IV. WAIVER OF PERMIT FEES

Subject to and in accordance with this Agreement, the City hereby agrees to waive all fees associated with acquiring the necessary building permit, plan review, plumbing permit, electrical permit, mechanical permit, fire inspection, right of way permit, water permit and sprinkler system permit for development of the property. The estimated amount of permit fees to be waived is approximately $681.00

V. RECORDS, AUDITS AND EVALUATION OF REQUIRED IMPROVEMENTS

A. Inspection of Property

Between the execution date of this Agreement and the last day of the Term, at any time during normal office hours throughout the Term and the year following the Term and following reasonable notice to B & G’s, LLC the City shall have and B & G’s, LLC shall provide access to the Property in order for the City to inspect the Property and evaluate the Required Improvements to ensure compliance with the terms and conditions of this Agreement. B & G’s, LLC shall cooperate fully with the City during any such inspection and/or evaluation.

B. Certification

B & G’s, LLC shall certify annually to the City that it is in compliance with each applicable term of this Agreement. The City shall have the right to audit the property. B & G’s, LLC shall make all applicable records available to the City following reasonable advance notice by the City and shall otherwise cooperate fully with the City during any audit.

VI. DEFAULT AND RECAPTURE

B & G’s, LLC shall be in default of this Agreement if B & G’s, LLC refuses, fails or neglects to substantially comply with the development of the property or discontinues the Residential use as required by the terms of this Agreement, or if any representation made by B & G’s, LLC is false or misleading in any material aspect. Termination of this Agreement may be effected if any such default is not cured within sixty (60) days after written notice by the City to B & G’s, LLC. If the City terminates this Agreement as a result of default by B & G’s, LLC, the tax abatement shall be immediately abolished and the City shall have the right to recapture all waived permits and inspections fees, and the taxes previously abated. In the event of termination, a bill for the total amounts due will be sent to B & G’s, LLC and B & G’s, LLC hereby agree to pay the total amounts due within sixty (60) days after receipt of the bill. Statutory penalties interest and attorney’s fees will accrue if City fails to timely pay the bill. Nothing in this Agreement shall preclude B & G’s, LLC from disputing the bill.

VII. TERMINATION AT WILL

If the City and B & G’s, LLC mutually determine that the development or use of the Property are no longer appropriate or feasible, or that a better use is preferable, the City and B & G’s, LLC may terminate this Agreement in a written format that is signed by both parties. In this event, if the Term has commenced, the Term shall expire as of the effective date of the termination of this Agreement; there shall be no recapture of any taxes previously abated or fees waived; and neither party shall have any further rights or obligations hereunder.

VIII. VENUE AND JURISDICTION

This Agreement shall be construed in accordance with the laws of the State of Texas and applicable ordinances, rules, regulations or policies of the City. Venue for any action under this Agreement shall lie in the State District Court of Webb County, Texas. This Agreement is performable in Webb County, Texas.

IX. SEVERABILITY

If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired.

X. BINDING EFFECT

This agreement shall insure to the benefit of and be binding upon the City and B & G’s, LLC and their affiliated, subsidiaries, successors and assigns.

Executed this the day of _______________, 2016, by City of Laredo.

BY: _________________________

Jesus M. Olivares, City Manager

ATTEST:

_____________________________Doanh “Zone” T. NguyenActing City Secretary


_____________________________Raul CassoCity Attorney

______________________________Kristina Laurel HaleFirst Assistant City Attorney

Executed this the day of _______________, 2016, by B & G’s, LLC.

BY: ____________________________

Name: ___________________________

Title: ____________________________


Initiated By: Cynthia Collazo, Deputy City Manager Initiated By: Fire Department

Staff Source: Steve E. Landin, Fire Chief

SUBJECT2016-R-10 Authorizing the City Manager to execute this Memorandum of Agreement(MOA)into by and between the Coastal Bend Regional Advisory Council (CBRAC) andthe City of Laredo Fire Department to participate as a member of Texas EmergencyMedical Task Force (hereinafter EMTF). This MOA is to establish a mechanism for theutilization and coordination of emergency medical resources and assets in the event ofan emergency or disaster.


BACKGROUNDThis Memorandum of Agreement (MOA) is to establish a mechanism for the utilizationand coordination of emergency medical resources and assets in the event of anemergency or disaster. The term for this MOA shall be ongoing or until cancelled byeither party and with notice.


STAFF RECOMMENDATIONLegal has reviewed and approved. Staff recommends that this resolution be adopted.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:No impact on the CBRAC-EMTF MOA, it is mainly a working agreement.

AttachmentsEMTF-MOARes.2016-R-10

A RESOLUTION NO. 2016-R-10

AUTHORIZING THE CITY MANAGER TO ENTER INTO AND EXECUTE A MEMORANDUM OF AGREEMENT, ATTACHED HERETO AS EXHIBIT A, BETWEEN

THE COASTAL BEND REGIONAL ADVISORY COUNCIL AND THE CITY OF LAREDO FIRE DEPARTMENT TO PARTICIPATE AS A MEMBER OF TEXAS

EMERGENCY MEDICAL TASK FORCE.

Whereas, the City of Laredo Fire Department and Coastal Bend Regional Advisory Committee establish a mechanism for the utilization and coordination of emergency medical resources and assets in the event of an emergency or disaster.

Whereas, Emergency Medical Task Force assets may readily available through different Regional Advisory Committees. Resources are deployed in Task Forces and provide the assistance needed to areas throughout the State of Texas

NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS;

SECTION 1: Authorizing the City Manager to enter into and execute a Memorandum of Agreement, attached hereto as Exhibit A, between Coastal Bend Regional Advisory Committee and the City of Laredo Fire Department to participate as a member of the Texas Emergency Medical Task Force in Region 11.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS,________________DAY OF___________________________, 2016.

_______________________________PETE SAENZ MAYOR

ATTEST:________________________________DOANH T. NGUYENCITY SECRETARY

________________________________APPROVED AS TO FORM:RAUL CASSO IVCITY ATTORNEY

BY________________________________KRISTINA LAUREL HALE ASSISTANT CITY ATTORNEY


Initiated By: Cynthia Collazo, Deputy City Manager Staff Source: Raymond E. Garner

SUBJECT2016-R-12 Authorizing the City Manager to enter into and execute 77 cooperativeworking agreements/mutual assistance agreements/memorandums of understandingbetween the City of Laredo Police Department and various federal, state and localagencies, including but not limited to: Drug Enforcement Administration (DEA), FederalBureau of Investigations (FBI), SCAN, et al., a comprehensive list is attached hereto as“Exhibit A”. The Police Department’s participation is part of the community serviceprovided to our citizens, with no cost to the City of Laredo.

VENDOR INFORMATION FOR COMMITTEE AGENDANone.

PREVIOUS COUNCIL ACTIONCity Council approved Resolution #2015-R-54 on July 20, 2015.

BACKGROUNDSince FY 2009 City Council approved the City of Laredo Police Department to work inconjunction with the agencies listed on Exhibit A. These agreements allow the PoliceDepartment to participate with other law enforcement agencies and refer civilians tosocial service organizations for any assistance.

COMMITTEE RECOMMENDATIONNone.

STAFF RECOMMENDATIONRecommends the approval of this Resolution.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: N/ASource of Funds: N/AAccount #: N/AChange Order: Exceeds 25% Y/N: N/A

FINANCIAL IMPACT:None.

AttachmentsResolution #2016-R-122016 MOUs List

COUNCIL COMMUNICATION

DATE:

2/1/2016

SUBJECT: RESOLUTION #2016-R-12Authorizing the City Manager to enter into and execute 77 cooperative working agreements/mutual assistance agreements/memorandums of understanding between the City of Laredo Police Department and various federal, state and local agencies, including but not limited to: Drug Enforcement Administration (DEA), Federal Bureau of Investigations (FBI), SCAN, et al., a comprehensive list is attached hereto as “Exhibit A”. The Police Department’s participation is part of the community service provided to our citizens, with no cost to the City of Laredo.

INITIATED BY:Cynthia CollazoDeputy City Manger

STAFF SOURCE:Raymond E. GarnerChief of Police

PREVIOUS COUNCIL ACTION: City Council approved Resolution # 2015-R-54 on July 20, 2015.

BACKGROUND: Since FY 2009 City Council approved the City of Laredo Police Department to work in conjunction with the agencies listed on Exhibit A. These agreements allow the Police Department to participate with other law enforcement agencies and refer civilians to social service organizations for any assistance.

FINANCIAL IMPACT: N/A

COMMITTEE RECOMMENDATION: STAFF RECOMMENDATION: Recommends the approval of this Resolution.

RESOLUTION #2016-R-12

Authorizing the City Manager to enter into and execute 77 cooperative working agreements/mutual assistance agreements/memorandums of understanding between the City of Laredo Police Department and various federal, state and local agencies, including but not limited to: Drug Enforcement Administration (DEA), Federal Bureau of Investigations (FBI), SCAN, et al., a comprehensive list is attached hereto as “Exhibit A”. The Police Department’s participation is part of the community service provided to our citizens, with no cost to the City of Laredo.

Whereas, the City of Laredo Police Department agrees to work in conjunction with these agencies; and

Whereas, the City of Laredo Police Department will assist law enforcement agencies on an as needed basis; and

Whereas, the City of Laredo Police Department will refer civilians that they come in contact with to those listed social service organizations that could assist them; and

Whereas, Exhibit A will be applicable starting on January 1, 2015 and ending on December 31, 2015.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAREDO THAT:

SECTION 1: Authorizing the City Manager to enter into and execute 77 cooperative working agreements/mutual assistance agreements/memorandums of understanding between the City of Laredo Police Department and various federal, state and local agencies, including but not limited to: Drug Enforcement Administration (DEA), Federal Bureau of Investigations (FBI), SCAN, et al., a comprehensive list is attached hereto as “Exhibit A”. The Police Department’s participation is part of the community service provided to our citizens, with no cost to the City of Laredo.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS THE _______ DAY OF _________________, 2016.

_________________________________PETE SAENZMAYOR

ATTEST:

____________________________DOANH "ZONE" T. NGUYENACTING CITY SECRETARY


BY: ___________________________RAUL CASSOCITY ATTORNEY

Agency Category1 Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) LEA2 Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) - eTrace LEA3 Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) - Radio Agreement Communications4 Children's Advocacy Center Social Services5 Correction Corporation of America (CCA) Detention Center LEA6 Correction Corporation of America (CCA) Detention Center - Radio Agreement Communications7 Correction Corporation of America (CCA) Processing Center LEA8 Drug Enforcement Administration (DEA) LEA9 Drug Enforcement Administration (DEA) - License Plate Reader Information LEA

10 FBI - Safe Streets Task Force LEA11 FBI - Task Force Officers Deputation LEA12 Harris County District Attorney LEA13 Juvenile Enforcement Task Force LEA14 Laredo Community College Police Dept. LEA15 Laredo Crime Stoppers, Inc. (PENDING) Social Services16 Laredo Housing Authority Social Services17 Laredo Independent School District Police Dept. LEA18 Laredo Independent School District Police Dept. - Radio Agreement Communications19 Laredo Independent School District Police Dept. - TLETS, TCIC, NCIC LEA20 Laredo Int'l Airport Air Traffic Control Communications21 Laredo Job Corps Social Services22 Laredo Police Department HIDTA Task Force - Homeland Security Investigations LEA23 Laredo-Webb County Safe Haven LEA24 Law Enforcement Analysis Portal (LEAP) LEA25 Learning For Life (LPD Explorers) Social Services26 Motorola, Inc. (equip. trial agreement) LEA27 Office of the Inspector General, TDCJ LEA28 Property Room.com LEA29 Regional Organized Crime Information Center (ROCIC) LEA30 Sam Houston State University - subaward agreement (USMS) LEA31 SCAN (End Violence Against and Abuse of Women Later in Life Program) Social Services32 SCAN (HIV Early Intervention Program) Social Services33 SCAN (Sexual Assault Response Team) Social Services34 SCAN (Sexual Assault Services Information) Social Services35 SCAN (Shelter and Street Outreach Services) Social Services36 SCAN (Substance Abuse and Mental Health Services Administration, National Child Traumatic Stress Initiative) Social Services37 SCAN (Transforming Texas Program) Social Services38 SCAN (Transitional Living Program) Social Services39 SCAN (Violence Against Women) Social Services40 SCAN (Webb County Coalition) Social Services41 SCAN (Youth Runaway and Homeless) Social Services42 South Texas Border Intelligence Center (STXBIC) LEA43 Texas A&M Int'l University - Radio Agreement Communications44 Texas A&M Int'l University Police Dept. LEA45 Texas Alcoholic Beverage Commission (TABC) - Office Space LEA46 Texas Alcoholic Beverage Commission (TABC) - Radio Agreement Communications47 Texas Crime Information Center (TCIC) - Lic. Plate Reader LEA48 Texas Department of Public Safety - Driver License Image Retrieval System LEA49 Texas Department of Public Safety - Motor Carrier Safety Assistance Program LEA50 Texas Department of Public Safety - TDEX LEA51 Texas Department of Public Safety - Victim Services LEA52 Texas Department of Public Safety and FBI Criminal Justice Information Systems LEA53 Texas DPS Aircraft - Radio Agreement Communications54 Texas DPS CCD Archive Website LEA55 Texas DPS Fusion Center LEA56 Texas DPS Gang Intelligence Index (TXGANG) LEA57 Texas Military Forces LEA58 Texas Parks & Wildlife (Lake Casa Blanca) LEA59 U.S. Customs and Border Protection (USBP) - Radio Agreement Communications60 U.S. Customs and Border Protection Office of Air and Marine - Radio Agreement Communications61 U.S. Customs and Border Protection/U.S. Border Patrol LEA62 U.S. Immigration & Customs Enforcement (ICE) - LPD Cross Designation LEA63 U.S. Immigration & Customs Enforcement (ICE) Homeland Security Investigations (HIS) LEA64 U.S. Immigration & Customs Enforcement (ICE) Port Isabel Detention Center LEA65 U.S. Marshals (USMS) - Fugitive Apprehension Task Force LEA66 United Independent School District (Radio Agreement) Communications67 United Independent School District Police Dept. LEA68 University of Texas Health Science Center at San Antonio Police Dept. LEA69 University of Texas-Pan American Affiliation Agreement Social Services70 University of Texas-Pan American Program Agreement Social Services71 Veterans Affairs Social Services72 Webb County Sheriff Department - Justice Assistance Grant Working Agreement LEA73 Webb County Sheriff Department - Operation Stonegarden Working Agreement LEA74 Webb County Sheriff Department - Radio Agreement Communications75 Webb County Sheriff Department - TLETS LEA76 Webb County Sheriff's Office - Crime Victims Unit and Domestic Violence Division LEA

77 Zapata County Sheriff Department - TLETS LEA

LAREDO POLICE DEPARTMENT2016 Agreements


Initiated By: Cynthia Collazo, Deputy City Manager Initiated By: Fire Department

Staff Source: Fire Chief Steve E. Landin

SUBJECT2016-R-14 Authorizing the City Manager to execute this Memorandum of Agreement(MOA) between South Texas Development Council (hereinafter STDC) and the City ofLaredo Fire Department in the amount of $20,000.00 to form a management andadministration structure to oversee, implement, and maintain the WebEOC for the SouthTexas Region 19. WebEOC is a web based crisis information management systemimproving the ability to share awareness of resources throughout the state and provideaccess to regional medical operation centers. local health departments, hospitals,emergency medical services, fire departments, and other emergency centers across thestate. Funds are appropriated in General Fund.

PREVIOUS COUNCIL ACTIONCity Council approved a one (1) year agreement between STDC and Laredo FireDepartment for the management and administration of the WebEOC on June 2, 2014.

BACKGROUNDThis Memorandum of Agreement (MOA) shall allow the Parties to form a managementand administration structure to oversee, implement, and maintain the WebEOC for theSouth Texas Region 19 area. The term of this MOA shall be for one (1) year, effectiveJune 1, 2015 (retro dated), unless terminated earlier.


STAFF RECOMMENDATIONLegal has reviewed and approved. Staff recommends that this resolution be adopted.

Fiscal ImpactFiscal Year:Bugeted Y/N?:Source of Funds:Account #:

Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The City Of Laredo Fire Department will receive $20,000 from the South TexasDevelopment Council to provide financial support for WebEOC system. This supportwill be used for license fees and associated maintenance costs. Contribution is forfiscal year 2016. Funds are appropriated in General Fund.

AttachmentsSTDC-WebEOC MOAResolution 2016-R-14

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MEMORANDUM OF AGREEMENT

BETWEEN THE SOUTH TEXAS DEVELOPMENT COUNCIL AND THE CITY OF LAREDO FOR THE MANAGEMENT AND ADMINISTRATION OF THE

WEBEOC EMERGENCY MANAGEMENT SYSTEM THIS Memorandum of Agreement (MOA) is made between the South Texas Development Council (hereinafter STDC) and the City of Laredo (hereinafter City), both referred to as the “Parties”.

RECITALS

WHEREAS, WebEOC is a web-based crisis information management system improving the ability to share awareness of available resources throughout the state and provide access to regional medical operations centers, local emergency operations centers, local health departments, hospitals, emergency medical services, fire departments, and other emergency operations centers across the state; WHEREAS, WebEOC provides an interface with state and federal agencies that may provide aid during emergency response and recovery stages for a local and/or regional emergency event; WHEREAS, the use of the WebEOC by stakeholders within the South Texas Region 19 (counties of Webb, Zapata, Starr, and Jim Hogg and all entities within) supports the Department of Homeland Security Strategic Plan, 2012-2016, Mission 5: Ensuring Resilience to Disasters through goals:

5.2: Enhance National Preparedness through a Whole Community Approach to Emergency Management, and 5.3: Ensure Effective Response,

Objective 5.3.2: Conduct effective disaster response operations, and Objective 5.3.3: Provide timely and appropriate disaster assistance;

WHEREAS, WebEOC is a tool that supports the Texas Homeland Security Strategic Plan, 2015-2020 (THSSP) Goal 4: Increase the capability of the state's response system to minimize damage and loss of life from terrorist and criminal attacks and natural and technological disasters, under objective:

4.4: Ensure continued enhancement of public health and medical emergency response systems:

4.4.1 Enhance public health disease containment capabilities including public health risk communication, isolation, quarantine, social distancing, and decontamination. 4.4.2 Maintain the state's ability to rapidly distribute and dispense medical material and countermeasures during a public health emergency. 4.4.3 Improve capacity to monitor the status of healthcare facilities during incidents to anticipate needed resources.

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4.4.4 Enhance current systems and develop new systems for meeting the demand for public health and medical surge capacity. WHEREAS, the use of WebEOC will strengthen regionally-based preparedness by focusing our finite resources on expanded regional collaboration and strengthen target capabilities shared by the State Homeland Security Program, the Health Preparedness Program, and the Public Health Preparedness Program to include Operational Coordination, Information Sharing, Community Preparedness, Fatality Management, Mass Care, Medical Surge, Mass Prophylaxis, and Medical Supplies Management and Distribution; WHEREAS, the City of Laredo currently owns the only WebEOC Software License in the South Texas Region 19; WHEREAS, the Parties agree that it is in the best interest of the community to execute a Memorandum of Agreement (MOA) to establish and implement the management and administration of the WebEOC license owned by City of Laredo to serve all the entities within the South Texas Region 19; WHEREAS, the Parties agree that the South Texas Homeland Security Advisory Committee (“HSAC”) is to provide advice and recommendations in the use and appropriation of funds, including money from relevant federal homeland security grants for the purposes of planning, funding, construction, implementation, expansion, operation, management and maintenance of regional projects in the South Texas Region 19; WHEREAS, the Texas WebEOC Interoperability Project (TWIRP) staff provide guidance and technical assistance to WebEOC Regional Administrators throughout the State of Texas; WHEREAS the Parties agree to execute this MOA with the City of Laredo to carry out the tasks defined in the Scope of Work (SOW) being services and technical support as deemed necessary; and NOW THEREFORE, IN CONSIDERATION of the mutual agreements and covenants contained herein, it is agreed as follows:

1. Establishment of a Memorandum of Agreement. The recitals hereinabove are true and correct and

incorporated herein, and there is hereby established the South Texas WebEOC Regional Administrator, for the purpose as described below and subject to the terms and conditions herein.

2. Purpose. The purpose of this MOA is to allow the Parties to form a management and administration

structure to oversee, implement, and maintain the WebEOC for the South Texas Region 19.

3. Scope of Work (SOW). Except as limited by federal, state, and local laws, regulations, codes, or ordinances of the City, City shall perform the following functions herein considered as Scope of Work (SOW) activities accepted and approved by both parties within this MOA to be performed by City for compensation by STDC:

1. Create and update WebEOC user access accounts. 2. Assist with user account permission level layout.

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3. Coordinate training opportunities for regional WebEOC users. 4. Install and configure WebEOC boards. 5. Provide account access and technical support to regional WebEOC users. 6. Activate real event boards as requested on a 24/7 basis. 7. Interface with personnel from other regions to develop and refine WebEOC Board

requirements. 8. Build WebEOC application ‘boards’ to include interoperability between local, regional and

state assets with guidance from Texas WebEOC Interoperability Program (TWIRP). 9. Maintain collaborative relationships with local users to facilitate and support quality

emergency planning and implementation during emergency events. 10. Maintain current knowledge of information assurance and security via literature review,

newsletters and/or conferences. 11. Actively participate in and collaborate with state, regional, community and federal

organizations that support emergency management program development. 12. Provide follow-up and resolution for identified problems. 13. Maintain organization and member confidentiality. 14. Attends all necessary meetings related to management of WebEOC. 15. Ensure the maintenance and sustainment of hardware and software equipment that

supports the WebEOC through upgrades and replacements as necessary.

4. Term. The term of this MOA shall be for a one (1) year period beginning on June 1, 2015 the

effective date, unless terminated earlier as provided for herein Section 5. The parties agree that the South Texas Homeland Security Advisory Committee (HSAC), STDC, and City will annually review the effectiveness of this Agreement and outcomes of such review may be considered in the renewal process in the establishment of a subsequent MOA between STDC and City or any given successor at the time.

5. Termination. This MOA may be terminated by either party hereto, for its convenience, on thirty (30) days written notice from the terminating party to the non-terminating party.

6. Compensation. STDC shall pay City a total of TWENTY THOUSAND ($20,000.00) annually as compensation for the services to be performed under this MOA on a quarterly basis with payment to be made at the end of first quarter after the effective date and each subsequent quarter thereafter which begins June 1st and ends May 31st. In the event of a change in the scope of services, additional complexity or a different character of work from that originally anticipated and authorized by City, the amount may be revised only by written agreement of the parties.

7. Financing and Current Revenues. Execution of this MOA is in accordance with the Inter-local Cooperation Act, Chapter 791 of the Texas Government Code. Each party’s monetary obligations, if any, under this MOA are payable only and solely from the current grant revenues appropriated and available for the performance of such obligations.

8. General Provisions. This Agreement contains all of the Agreements of the parties with respect to

any matter covered or mentioned in this MOA, and no prior Agreement shall be effective for any

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purpose. No provisions of the MOA may be amended or modified except by written agreement signed by the Parties.

9. Limitation of Liability. In no event shall the parties to this MOA be liable to the other party for any special, consequential, incidental or punitive damages on any claim arising out of or concerning this Agreement.

10. Indemnity. To the extent permitted by the laws and Constitution of the State of Texas STDC shall indemnify and hold harmless City and City’s officers, agents, employees, and assigns from all suits, actions, or other claims of any character brought for or on account of injury to a person or property arising under this agreement.

11. Force Majeure. Neither party shall be liable for any default or delay in the performance of its

obligations under this Agreement if, while and to the extent such default or delay is caused by acts of God, unusual weather conditions, fire, riots, sabotage, acts of domestic or foreign terrorism, or any other cause beyond the reasonable control of such Party ("Force Majeure"). Force Majeure does not include economic or market conditions, which affect a party’s cost, but not its ability to perform. The party invoking Force Majeure shall give prompt, timely and adequate notice to the other party, by facsimile transmission or telephone confirmed promptly thereafter in writing, and shall use due diligence to remedy the event of Force Majeure, as soon as reasonably possible. In the event of default or delay in Agreement performance due to any of the foregoing causes, then the time for completion of the services will be extended by a mutually agreeable period of time reasonably necessary to overcome the effect of such failure to perform.

12. Independent Contractor. This MOA shall not be construed as creating an employer/employee relationship, partnership, joint enterprise, or a joint venture between the parties. STDC and City are independent contractors.

13. Survival of Obligations. All provisions of this MOA that impose continuing obligations on the parties, including but not limited to indemnity, confidentiality, and release shall survive the expiration or termination of this Agreement.

14. Designation of Project Managers. The City designates Jose Gamboa as Project Manager or his successor in office. City has, within its sole discretion the right to designate or re-designate the Project Manager at any time it so deems appropriate. The City’s Project Manager represents the interests of the City of Laredo during the term of this MOA and is the designated point of contact for the City. The STDC Project Manager is Guadalupe Trinidad, or her successor in office. The STDC Project Manager represents the interests of the STDC region during the term of this MOA and is the designated point of contact for the project management of tasks related to this agreement and day to day operations.

15. Severability. Each paragraph and provision hereof is severable from the entire Agreement and if

any provision is declared invalid, the remaining provisions shall nevertheless remain in effect.

16. Prohibition against Assignment. There shall be no assignment or transfer of this Agreement without the prior written consent of both parties hereto.

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17. Law of Texas. This Agreement shall be governed by and construed in accordance with the laws of

the State of Texas and shall be enforced in Webb County, Texas.

18. Notices. All notices called for or contemplated hereunder shall be in writing and shall be deemed to have been duly given when personally delivered or forty eight (48) hours after mailed to each party by certified mail, return receipt requested, or postage prepaid.

To City: To STDC: City of Laredo Fire Department South Texas Development Council Attention: Chief Steve Landin Attention: Robert Mendiola WebEOC Regional Administrator Executive Director 616 East Del Mar P.O. Box 2187 Laredo, Texas 78045 Laredo, Texas 78044 With a copy to: With a copy to: Ramiro Elizondo-Deputy Chief-EMS John R. Keiser-Regional Programs Manager

19. Entire Agreement. This Agreement incorporates all the agreements, covenants, and understandings

between the parties hereto concerning the subject matter hereof, and all such covenants, agreements, and understandings have been merged into this written Agreement. No other prior agreement or understandings, verbal or otherwise, of the parties or their agents shall be valid or enforceable unless signed by both parties and attached hereto and/or embodied herein.

20. Amendment. City has prior authorization to conduct changes for less than 10% of the total budget

under this agreement between Travel and related Scope of Work (SOW) total cost. City must submit a formal budget amendment request to STDC for budget changes that result in greater than 10% of the City’s total approved budgets as represented in this agreement.

21. Confidentiality. Any confidential information provided to or developed by the Parties in the

performance of this Agreement shall be kept confidential, unless otherwise provided by law, and shall not be made available to any individual or organization without the prior written approval of the Parties.

22. Headings. The headings used herein are for convenience of reference only and shall not constitute

a part hereof or affect the construction or interpretation hereof.

23. Waiver. The failure on the part of any party to exercise or to delay in exercising, and no course of dealing with respect to any right hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies provided herein are cumulative and not exclusive of any remedies provided by law or in equity, except as expressly set forth herein.

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24. Counterparts. This Agreement may be executed in any number of and by the different parties hereto on separate counterparts, each of which when so executed shall be deemed to be an original, and such counterparts shall together constitute but one and the same document.

25. Terminology and Definitions. All personal pronouns used herein, whether used in the masculine,

feminine, or neutral, shall include all other genders; the singular shall include the plural and the plural shall include the singular.

26. Rule of Construction. The parties hereto acknowledge that each party and its legal counsel have

reviewed and revised this agreement, and the parties hereby agree that the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this agreement or any amendments or exhibits hereto.

27. Immunity. The City does not waive or relinquish any immunity or defense on behalf of themselves,

their trustees, commissioners, council members, officers, employees and agents as a result of the execution of this Agreement and performance of the functions and obligations described herein.

28. Legal Compliance. The parties hereto agree to comply fully with all applicable federal, state and

local statutes, ordinances, rules, and regulations in connection with the programs contemplated under this agreement. In the event that any of the parties hereto are required by law or regulation to perform any act inconsistent with this agreement, or to cease performing any act required by this agreement, this agreement shall be deemed to have been modified to conform to the requirements of such law, regulation or rule.

29. Debarment. As required by Executive Order 12549, Debarment and Suspension, and

Implementation at 28C.F.R. Part 67, for prospective participants in primary covered transactions, as defined at 28 C.F.R. Part 67, Section 67.510 (Federal Certification), the City certifies that it and its principals and vendors:

32-1. Are not debarred, suspended, proposed for debarment, declared ineligible, sentenced to a denial of Federal benefits by a State or Federal court or voluntary excluded from covered transactions by any Federal department or agency; access to debarment information can be made by going to www.epls.gov and the State Debarred Vendor List http://www.window.state.tx.us., or http://www.window.state.tx.us/procurement/prog/vendor performance/debarred; 32-2. Have not within a three-year period preceding this agreement been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining attempting to obtain, or performing a public (Federal, State, or local) transaction or contract under a public transaction; violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery bribery, falsification or destruction of records making false statements, or receiving stolen property; 32-3. Are not presently indicted for or otherwise civilly charged by a governmental City (Federal, State, local) with commission of any of the offenses in paragraph 31-2 of this Agreement; and

http://www.epls.gov/

http://www.window.state.tx.us/

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32-4. Have not within a three-year period preceding this agreement had one or more public transaction (Federal, State, or local) terminated for cause or default; and 31-5. Where the City is able to certify to any of the statements in this certification, he or she shall attach an explanation to this agreement.

IN WITNESS WHEREOF, the City of Laredo acting by and through its designated City Manager, and the South Texas Development Council, acting by and through its Executive Director, have executed this agreement in duplicate originals, each of equal dignity. CITY OF LAREDO SOUTH TEXAS DEVELOPMENT COUNCIL

________________________________

_____________________________

Jesus M. Olivares City Manager

Robert Mendiola Executive Director

Date: __________________________

Date: __________________________

ATTEST:

________________________________

Doanh T. Nguyen City Secretary


________________________________

Raul Casso City Attorney

A RESOLUTION NO. 2016-R-14

AUTHORIZING THE CITY MANAGER TO ENTER INTO AND EXECUTE A MEMORANDUM OF AGREEMENT, ATTACHED HERETO AS EXHIBIT A, BETWEEN

SOUTH TEXAS DEVELOPMENT COUNCIL AND THE CITY OF LAREDO FIRE DEPARTMENT IN THE AMOUNT OF $20, 000 FOR THE PURPOSE OF FORMING A MANAGEMENT AND ADMINISTRATION STRUCTURE TO OVERSEE, IMPLEMENT,

AND MAINTAIN THE WebEOC FOR THE SOUTH TEXAS REGION 19.

Whereas, WebEOC is a web-based crisis information management system improving the ability to share awareness of available resources throughout the state and provide access to regional medical operations centers, local emergency operations centers, local health departments, hospitals, emergency medical services, fire departments, and other emergency operations centers across the state;

Whereas, WebEOC provides an interface with state and federal agencies that may provide aid during emergency response and recovery stages for a local and/or regional emergency event;

Whereas, the use of WebEOC will strengthen regionally-based preparedness by focusing our finite resources on expanded regional collaboration and strengthen target capabilities;

NOW, THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LAREDO, TEXAS;

SECTION 1: Authorizing the City Manager to enter into and execute a Memorandum of Agreement, attached hereto as Exhibit A, between South Texas Development Council and the City of Laredo Fire Department in the amount of $20,000for the purpose of forming a management and administration structure to oversee,implement, and maintain the WebEOC for the South Texas Region 19.

PASSED BY THE CITY COUNCIL AND APPROVED BY THE MAYOR ON THIS,________________DAY OF___________________________, 2016.

_______________________________PETE SAENZ MAYOR

ATTEST:________________________________DOANH T. NGUYENCITY SECRETARY

________________________________APPROVED AS TO FORM:RAUL CASSO IVCITY ATTORNEY

BY________________________________KRISTINA LAUREL HALE ASSISTANT CITY ATTORNEY


Initiated By: Jesus Olivares, City Manager Staff Source: Riazul I. Mia, P.E.,C.F.M. Utilities Director

SUBJECTAuthorizing the City Manager to award an Architectural and Engineering Servicescontract in the amount of $ 163,560.00 to Sepulveda Associates Architects, Inc., Laredo,Texas for the design, technical drawings, bidding documents, specifications,construction administration services with production printing, and as-built for the UtilitiesDepartment Administration Building. Funding is available in 2013 Sewer Revenue Bondand 14 WW/SW Revenue Bond.

PREVIOUS COUNCIL ACTIONOn October 5, 2015 City Council approved the selection of architectural consultantbased on Request For Qualifications (RFQ) received and authorized the City Managerto negotiate a contract for the design, bidding and construction management of theOffice Building for the Utilities Department with Sepulveda Associates Architects, Inc.

BACKGROUNDRequest for Qualifications (RFQ) were advertised on August 10, 2015 and the RFQ wasclosed on September 11, 2015. A total of six (6) licensed architectural firms respondedto the request and staff from various departments reviewed the submittals and selectedthe three most qualified firms based on: 1) Specialized experience of firm; 2) ProjectPersonnel; 3) Approach to work; and, 4) Other considerations.

COMMITTEE RECOMMENDATIONFinance and Operations Committees

STAFF RECOMMENDATIONApprove Motion

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: 2013 Sewer Revenue BondAccount #: 559-4288-538-0409Change Order: Exceeds 25% Y/N:

FINANCIAL IMPACT:

Fiscal Year: 2016Bugeted Y/N?: YSource of Funds: 14 WW/SW Revenue BondAccount #: 559-4289-538-0409Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

AttachmentsSepulveda Associates Proposal


Initiated By: Jesus Olivares, City Manager Staff Source: Riazul I. Mia, P.E.,C.F.M. Utilities Director

SUBJECTAuthorizing the City Manager to award an Engineering Services contract in the amountof $ 110,000.00 to Porras Nance Engineering, Laredo, Texas for the topographic survey& preliminary schematics, plans, specs, bidding documents, estimates, TxDot Permit &Utility Coordination, easement plat & description, construction staking, coordination &administration, as-built plans & close out documents for the 24" Waterline along CuatroVientos Road. Funding is available in the 2015 Water Revenue Bond.

PREVIOUS COUNCIL ACTIONOn January 19, 2016 City Council approved the selection of engineering consultantbased on Request For Qualifications (RFQ) received and authorized the City Managerto negotiate a contract for the design, bidding and construction management of the 24"Waterline along Cuatro Vientos Road with Porras Nance Engineering

BACKGROUNDRequest for Qualifications (RFQ) were advertised on October 25, 2015 and the RFQwas closed on November 6, 2015. A total of seven (7) licensed engineering firmsresponded to the request and staff from various departments reviewed the submittalsand ranked the qualified firms based on: 1) Specialized experience of firm; 2) ProjectPersonnel; 3) Approach to work; and, 4) Other considerations

COMMITTEE RECOMMENDATIONFinance and Operations Committees

STAFF RECOMMENDATIONApprove Motion

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: 2015 Water Revenue BondAccount #: 557-4197-538-0359Change Order: Exceeds 25% Y/N:

FINANCIAL IMPACT:

AttachmentsProposal 24" WL along Cuatro Vientos Rd


Initiated By: Jesus Olivares, City Manager Staff Source: Riazul I. Mia, P.E., Utilities Department Director, Miguel A. Pescador,

Purchasing Agent

SUBJECTConsideration to ratify the emergency contract issued to Bradley Motors, Gregory,Texas, in the total amount of $51,805.00 for the repair of a 600 HP Vertical Motor atJefferson WTP East High Service Pump #1. These repairs are needed due to highservice pump usage during the upcoming summer months. Funding is available in theUtilities Department fund.



BACKGROUNDCity Management has authorized the emergency repair in the amount of $51,805.00.The complete motor rewind scope for 600 HP is as follows: Replace damaged motorand auxiliary components such as heaters, dynamically balance rotor, repair stator iron,install new Class F Coils, assemble motor and all auxiliary components, install new ballbearing, install new thrust bearing, install (6) new platinum winding RTD’s, install new240 volt 1750 watt tube heaters, install new press-in oil sight glasses, apply finalprotective coating to motor and auxiliary components, ship, and deliver. The workperformed will have a one year warranty. Estimated completion of repairs is three to fourweeks.

Bradley Motors600 East Highway 35Gregory, TX 78359


STAFF RECOMMENDATIONIt is recommended that this ratification be approved.

It is recommended that this ratification be approved.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YesSource of Funds:Account #: 55741205332030Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Funding for these repairs are available in the Utilities Department Fund.

AttachmentsMotor Damage PictureBradley Contract RRQ1400


Initiated By: Jesus Olivares, City Manager Staff Source: Horacio De Leon, Assistant City Manager, Rosario C. Cabello, Finance

Department Director, Miguel A. Pescador, Purchasing Agent

SUBJECTAuthorizing the City Manager to enter into and execute a Toshiba Governmental CopierLease Program Contract with Toshiba Business Solutions (USA) Inc., San Antonio, TX,for the use of ninety nine (99) new copiers; and authorizing that the equipment leasefinance agent be Lage Landen Public Finance, L.L.C. This lease is through a TEXASDIR Contract, Toshiba Public Finance Contract and lease agreement shall be for a fortyeight (48) month period with an estimated lease contract total of $416,640.96. Thiscontract is contingent on continued appropriations in future fiscal years and funding forthe lease purchase payments shall be available in user departmental budgets.



BACKGROUNDOn February 2012, the City of Laredo previously awarded a forty eight month contract toToshiba Business Solutions who offered the best value for the city including the bestoverall pricing and equipment that meets the operational needs of the city departments.

This year the City received, reviewed and considered DIR and TCPN cooperativeproposals from Toshiba and Xerox. After evaluating proposal factors including: pricing,tech support, units offered, maintenance/support, Staff recommends awarding thiscopier lease agreement to Toshiba Business Solutions.

This new 2016 (48 month) lease will give the City significant budget savings: currentlease monthly payments are $10,652.47 versus new lease payment of $8,680.02translates to $1,972.45 monthly savings; contract includes: the copiers, all tonersupplies, and a full service maintenance contract (technicians). This is an all inclusiveMaintenance Agreement for 99 new copiers plus 32 existing units with a pooled volumemonthly allowance of 700,000 prints (copies) per month. Also, as part of this newcontract, Toshiba has offered to buyback current equipment (copiers) from the City ofLaredo for $16,000.

Toshiba and Xerox Lease Proposals Summary is attached.


STAFF RECOMMENDATIONIt is recommended that this contract be approved.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YesSource of Funds:Account #:Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:This lease is through a TEXAS DIR Contract, _______________ Public FinanceContract (lease finance agent will be __________________________) and leaseagreement shall be for forty eight (48) month period with an estimated lease contracttotal of $_______________________. This contract is contigent on continuedappropriations in future fiscal years and funding for the lease purchase payment shallbe available in user departmental budgets.


Initiated By: Cynthia Collazo, Deputy City Manager Staff Source: Steve E. Landin, Fire Chief; Miguel A. Pescador, Purchasing Agent

SUBJECTConsideration to award contract FY16-027 to the sole bidder, Galls, LLC., Lexington,KY, in the estimated annual amount of $215,400.00, for the purchase of uniforms, bootsand accessories for the Fire Department. These items are included in the CollectiveBargaining Agreement between the City and the Firefighters Union. Each firefighter hasa $600.00 clothing allowance that may be used to purchase any of the listed items in theagreement. The term of the contract is for three (3) years, subject to future budgetappropriations. Contract has renewal options for two (2) additional one year periods.Funding is available in General Fund - Fire Department's operational budget.



BACKGROUNDAuthorization is requested to award a contract to low bidder, Gall's, LLC,. for thepurchase of uniforms, boots. multi-purpose tools, rain suits, duffel bags and other itemsapproved by the department, These items are included in the collective bargainingagreement. Each fire fighter has $600.00 clothing allowance that may be used topurchase any of these items. The term of the contract is for three years and may beextended for two additional one (1) year period each upon mutual agreement of theparties. Should the vendor desire to extend the contract for the additional one yearperiod, it must notify the City in writing no later than sixty (60) days before the expirationof the prior term. Such notification shall be effective upon actual receipt by the City. It isexpressly understood by the parties that any such extension of this contract is entirelyrevocable at the City's discretion and is contingent upon the agreement and acceptanceby the City Council.


STAFF RECOMMENDATIONIt is recommended that this contract be awarded.

It is recommended that this contract be awarded.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YesSource of Funds:Account #: 101-2410-522-0800Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The purpose of this contract is to establish prices for the commodities or servicesneeded, should the City need to purchase these commodities or services. The City'sobligation for performance or an annual supply contract beyond the current fiscal yearis contingent upon the availability of appropriated funds from which payments for thecontract purchase can be made. If no funds are appropriated and budgeted during thenext fiscal year, this contract becomes null and void.

Fiscal Year: 2016Bugeted Y/N?: YesSource of Funds:Account #: 101-2415-522-0800Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:



Fiscal Year: 2016

Bugeted Y/N?: YesSource of Funds:Account #: 101-2435-522-0800Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

AttachmentsFire Department Uniforms


Initiated By: Jesus Olivares, City Manager Staff Source: Rogelio Rivera, P.E., City Engineer, Jack Dunn, Fleet General Manager,

Miguel A. Pescador, Purchasing Agent

SUBJECTConsideration to award annual supply contract FY16-022 to Neuhaus & Company,Weslaco, Texas in an amount up to $50,000.00, for the purchase of John Deere originalequipment manufacturer (OEM) repair parts for the City’s lawn maintenance equipment.All parts will be purchased on an as needed basis. The term of this contract shall be fora period of one (1) year beginning as of the date of its execution. This contract has fiveextension renewal option periods, upon mutual agreement. Funding is available in theFleet Maintenance Budget.



BACKGROUNDThe City received two bids for the purchase and supply of OEM captive parts for theCity's lawn maintenance equipment. Although EBR, LLC., submitted a bid, this companyis not an authorized dealer/distributor for John Deere and Toro OEM parts. Arecommendation is being presented to the City Council that a contract be awarded toNeuhaus & Company. This contract establishes a percentage discount on John Deereoriginal lawn maintenance equipment manufacturer parts.

The term of this contract shall be for a period of one (1) year beginning as of the date ofits execution. The contract may be extended for five, additional one (1) year periods.Should the vendor desire to extend the contract for the additional one year period, itmust so notify the City in writing no later than thirty (60) days before the expiration of theprior term. Such notification shall be effective upon actual receipt by the City. Renewalsshall be in writing and signed by the City's Purchasing Manager & City Manager or hisdesignee, without further action by the Laredo City Council, subject to and contingentupon appropriation of funding therefore. All annual contracts shall bound by the terms ofthe bid documents. The City shall also have the right to extend this contract under thesame terms and conditions beyond the original term or any renewal thereof, on a monthto month basis, not to exceed 3 months. Said month to month extensions shall be inwriting, signed by the City's Purchasing Manager & City Manager or his designee, and

shall not require City Council approval, subject to and contingent upon appropriation offunding therefore. If the pricing remains the same or price adjustment has mutualagreement from both parties and the City agrees to extend the contract, the contractshall automatically renew for another one year period.

Bid Summary:Neuhaus & Company John Deere OEM Parts TORO OEM Parts

Percentage of DiscountOffered Up to 10% No Bid

Type of Price Schedule John Deere DealerDate of Price Schedule 9/12/14

EBR, LLC. John Deere OEM Parts TORO OEM PartsPercentage of DiscountOffered 10% 10%

Type of Price Schedule John Deere Retail TORO RetailDate of Price Schedule 1/16/16 1/16/16***Not Authorized Dealer


STAFF RECOMMENDATIONIt is recommended that this contract be approved.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YesSource of Funds:Account #: 59328105332071Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:The purpose of this contract is to establish prices for the commodities or servicesneeded should the City need to purchase these commodities or services. The City'sobligation for performance of an annual supply contract beyond the current fiscal yearis contingent upon the availability of appropriated funds from which payments for thecontract purchases can be made. If no funds are appropriated and budgeted duringthe next fiscal year, this contract becomes null and void.

Fiscal Year: 2016Bugeted Y/N?: Yes

Source of Funds:Account #: 59328105332079Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:

AttachmentsContract FY16-022


Initiated By: Jesus Olivares, City Manager Staff Source: Rogelio Rivera, P.E., City Engineer; Mario Maldonado, Bridge Manager

SUBJECTConsideration to award a construction contract to the lowest bidder, ABBA Construction,L.L.C., Laredo, Texas, in the base bid amount of $99,280.00 for the Laredo ColombiaInternational Bridge Expansion Joint Rehabilitation with a construction contract time ofninety (90) calendar days; and authorizing the City Manager to execute all relatedcontract documents contingent upon receipt and approval of insurance and bonddocuments. Completion date for the project is scheduled for May 2016. Funding isavailable in the Bridge 2008 Bond.


BACKGROUNDThe purpose of this project is to make repairs to polymer epoxy dam expansion joints onthe Laredo Colombia International Bridge. Repairs are to be made at specific locationsas identified on the construction plans. One section of the dense concrete overlay on thebridge survey will also be repaired. The successful contractor will be required to developand submit his intended traffic control plan to the Engineer for review and comment,prior to commencement of any work requiring road closures.

Plans and specifications were prepared by Structural Engineering Associates, Inc., SanAntonio, Texas.

Three (3) bids were received at the City Secretary’s Office at 4:00 P.M. on Thursday,January 7, 2016, and publicly opened, read, and taken under advisement on Friday,January 8, 2016, at 10:00 A.M. as follows:

Contractor (s) Base BidABBA Construction, L.L.C.Laredo, Texas $99,280.00

Restek, Inc.Austin, Texas

$96,250.00(106,250.00 – Corrected Bid)

SJ&J Construction, LLC.Dallas, Texas $123,750.00

The bid and bid bonds for ABBA Construction, L.L.C., Laredo, Texas, were checked andfound to be in order. Staff therefore concurs with consultant and recommends award inthe base bid amount of $99,280.00 to the lowest bidder ABBA Construction, L.L.C.,Laredo, Texas.

Construction contract time is ninety (90) calendar days after notice to proceed is issued.Completion date for the project is scheduled for May 2016.

COMMITTEE RECOMMENDATIONN/A.

STAFF RECOMMENDATIONApproval of Motion.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YesSource of Funds: Bridge 2008 BondAccount #: 553-4067-583-2010Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Funding is available in the Bridge 2008 Bond.Account No. 553-4067-583-2010

AttachmentsSite Map


Initiated By: Cynthia Collazo, Deputy City Manager Staff Source: Blasita J. Lopez

SUBJECTAuthorizing the City Manager to renew contract FY15-027 for the Laredo LemursBaseball 2016 season visiting team and special events lodging expenses withTownePlace Suites. The contract amount is not to exceed $102,000.00. Funding isavailable in the Laredo Convention and Visitors Bureau FY 2015-2016 budget.

PREVIOUS COUNCIL ACTIONOn April 6, 2015, City Council authorized the City Manager to enter in to this contractwith TownePlace Suites for the 2015 baseball season.

BACKGROUNDIn the terms and conditions of the Memorandum of Understanding between the City ofLaredo and Laredo Baseball Holding Inc., for the lease and operations of the Uni-TradeStadium, the City of Laredo shall contribute $200,000 in cash, or in kind contribution,annually to marketing the Lemurs and/or other Stadium events. Laredo CVB staff andStadium management have come to a mutual agreement on the various efforts that themoney will be used for, including housing services as official hosts to the visiting leagueteams.


STAFF RECOMMENDATIONStaff recommends that Council approve this motion.

Fiscal ImpactFiscal Year: 2016Bugeted Y/N?: YSource of Funds: CVB 5315Account #: 250.5315.553.5609Change Order: Exceeds 25% Y/N:FINANCIAL IMPACT:Funding for these expenses are in the FY 2015-2016 CVB Marketing Division:

Funding for these expenses are in the FY 2015-2016 CVB Marketing Division:

Stadium Lemurs Promotion, 250.5315.553.5609

AttachmentsLetter-Extend Contract

Executive Session 25. City Council-RegularMeeting Date: 02/01/2016

Initiated By: Jesus Olivares, City Manager Staff Source: Raul Casso, City Attorney

SUBJECTRequest for executive session pursuant to Texas Government Code Section 551.072 todeliberate on-going negotiations regarding the value of real property located at northend of the Laredo International Airport, legally described as an approximate 18.33-acretract of land, Eastern Division, Laredo, Webb County, Texas. Acquisition of this tractwould be for municipal purposes, Runway Protection Zone.

VENDOR INFORMATION FOR COMMITTEE AGENDANo financial impact.


BACKGROUNDNone.


STAFF RECOMMENDATIONApproval is recommended.

City Council Meeting

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Transcript of City Council Meeting