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Regular Council Meeting July �31' 2012 Page 5 that PEDC could move their operation to the incubator building. Mr. Godwin stated that the 1593 Santa Fe Depot was a great old building and encouraged them to come up with a solution to continue to have a tenant. He asked for direction from City CouncilMayor Hashmi said he thought they should finish this agreement and then let PEDC have the building for $1.00 a year or no money, because he said PEDC was a part of the City, the building was City property and this would help reduce PEDC's overhead. 16. Discuss and act on RESOLUTION NO. 2012 -068: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS APPROVING AN AMENDMENT TO THE FY 2011 -2012 BUDGET OF THE PARIS ECONOMIC DEVELOPMENT CORPORATION (PEDC) TO TRANSFER $1,450,000,000.00 FROM CASH RESERVES TO THE SURMA/TXDOT SH19/24 WIDENING PROJECT, MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND PROVIDING AN EFFECTIVE DATE. Mr. Anderson said the PEDC Board voted to amend and increase the 2011 -12 PEDC budget by $1,450,000 and the source of the funds was existing cash reserves held by PEDC. He also said the purpose of the budget increase was to pay PEDC's complete share of the Highway 19/24 Widening Project. Mr. Anderson said the cash prepayment was designed to prevent any restrictions or complications to the issuance of future bond debt by PEDC. Mayor Hashmi reminded PEDC Director Steve Gilbert that he was the one who actually proposed the item be paid over a twenty year period and inquired as to the change. Mr. Gilbert said the PEDC started looking at the reserves and cash obligations and had two major decisions, one was should they finance this loan portion over the twenty year period and also, should they pay the outstanding bonds from Paris Packaging early with the cash. Mr. Gilbert said PEDC was concerned about their ability to enter into future debt obligations, that the Board thought it was best that PEDC pay the $1,450,000 in cash and not have restrictions imposed on them. Council Member Wright asked when PEDC guaranteed a loan did it tie up their ability to collateralize. Mr. Gilbert said if they guaranteed a loan it was collateralized. Council Member Wright said his gut reaction was that it was better to have money in the bank. Mayor Hashmi and Council Member Wright wanted to know if PEDC had to keep its collateral in liquid form. Mr. Gilbert said he did not think they had to but deferred to Gene Anderson. Mr. Anderson said it depended on the terms of the agreement. Based on PEDC Board's recommendation, a Motion to approve this item was made by Mayor Hashmi and seconded by Council Member Wright. Motion carried, 5 ayes — 0 nays. 17. Discuss and act on a RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS AUTHORIZING THE CITY TO BECOME ELIGIBLE TO PARTICIPATE IN TAX ABATEMENT AND APPROVING AMENDED GUIDELINES AND CRITERIA FOR GRANTING TAX ABATEMENTS IN THE CITY OF PARIS, TEXAS; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE.