Corpus Christi City Council Regular Meeting – May 13, 2025

The City Council met on Tuesday, May 13, 2025, beginning at approximately 11:30 a.m. in Council Chambers at 1201 Leopard Street. The agenda included the FY 2024 Annual Comprehensive Financial Report, public comment, an Inner Harbor Water Treatment Campus briefing, a grant activity update, the 89th Texas Legislative Session briefing, a consent agenda, two individual consideration items, and executive sessions. The Council approved the consent agenda, a resolution opposing improper or illegal housing authority property tax exemptions, a resolution supporting Texas moving image incentive legislation, and the FY 2025 plan of finance / certificate of obligation notice. The legislative briefing was deferred and sent to Council by email.

City Manager's Comments / FY 2024 ACFR Briefing

• Briefing by Assistant City Manager Heather Hurlbert and Matt Rogers of Weaver and Tidwell, LLP.
• Independent audit resulted in an unmodified ("clean") opinion on the ACFR; no material weaknesses and no material noncompliance were identified.
• One recurring significant deficiency was cited relating to the timeliness of financial statement close procedures and staffing turnover; the auditor said improvement was seen and expected resolution in FY 2025.
• The federal single audit was clean; major programs were immunization grants and ARPA/Coronavirus State and Local Fiscal Recovery Funds. The state single audit was clean; its major program was hospital preparedness. The airport passenger facility charge audit was also clean.
• One uncorrected misstatement was reported: capital assets in FY 2023 were classified as repairs and maintenance but should have been capitalized; it was corrected through a beginning balance adjustment. No corrected material misstatements were identified.
• Council discussion focused on staff turnover, standard operating procedures, and Council members asking to receive the large financial report earlier. City Manager Zanoni noted the city has about 4,000 employees and a $1.8 billion budget.

Public Comments & Testimony

• Steve Clepper, a 30-plus-year resident, criticized the City Attorney for interrupting his previous public comment; he said rhetorical questions were not questions to the Council and asked for courtesy toward all speakers.
• Susie Saldana voiced strong opposition to Corpus Christi Housing Authority land transactions, calling them a "money grab" and urging the Council to stop them; she claimed the city could lose tax revenue and asked for charges to be filed.
• Eli Oliver, a Life Scout, requested support for his Eagle Scout project to install four interpretive panels at Bill Witt Park memorializing the NASA tracking station; he said he was close to his $15,000 fundraising goal. City staff and council members praised the project and said they would follow up.
• Kent Oliver, Eli's father, asked the parks department and Council to place the panels in a high-traffic area near the new aquatic center and to coordinate design and color matching.
• Rob Bailey provided historical context on the tracking station's role in NASA missions, including the first live television broadcast from space over Corpus Christi during Apollo 7.
• Isabella Ariza of District 2 criticized water summit sponsorship tiers, alleged the city was prioritizing wealth over residents, criticized housing authority tax exemptions, and called for City Manager Zanoni to be fired.
• Martilena Garza of District 1 raised concerns about cooling centers, library budget cuts, and barriers for people with pets during extreme heat; she asked the city to address those gaps.
• Rachel Caballero of District 1 called for the City Manager's resignation or performance review and listed grievances including a broken CCAT cremation unit, employee turnover, deferred maintenance, use of certificates of obligation, population growth concerns, public information requests, and drought planning.
• Eli McCain criticized the City Manager and an at-large council member for comments at the budget workshop; she said council members should represent all residents and listen before speaking.
• Adam Rios publicized donation details for the Bill Witt Park project and the Ritz Mahjong tournament, then delivered a personal tribute to his mother and the importance of community.
• John Hendrix, VFW Post 2397 quartermaster, thanked the city for funding restoration of the new baby cemetery; he proposed making the Feast of Corpus Christi an official city holiday and noted it falls on Juneteenth this year.

Briefing: Inner Harbor Water Treatment Campus Update

• Brett Van Hazel, PMO Director, reported Phase 1A is nearly complete as of June 1; deliverables include a basis of design report and an early cost model, with the cost model expected at Council in July. Phase 1B started in April. Construction is planned to begin in early 2026 and continue through summer/fall 2028; operations would transition to the city after one year.
• TCEQ-required modeling by GHD covers only the Inner Harbor Ship Channel, about 7.2 miles west and 1.5 miles east of the discharge. Results are expected at the end of June and will be presented in July; the modeling will evaluate dissolved oxygen and stratification relevant to hypoxia.
• The demonstration plant is scheduled to begin construction in June, begin operation in July/August, and run continuously for 30 days around September/October, followed by a feasibility report to TCEQ.
• Drew Molly, COO, provided an alternative water supply update. On the Nueces River groundwater wells project, four wells are installed; well #1 was producing roughly 1,100 gallons per minute, about 1.5 million gallons per day. A temporary Bed and Banks permit application was submitted to TCEQ on May 12, and letters were sent to the governor; Mathis, Beeville, and Alice have expressed support. The full wellfield build-out would produce about 10-12 million gallons per day. Approximately $6 million has been spent on the wells to date.
• Evangeline, EV Ranch, South Texas Water Authority/Seven Cs, and reclaimed water projects are being evaluated with consultant Garver, which received notice to proceed on May 5. Staff said they are working toward an initial business-case update around June 10.
• Council discussion included Stage 3 drought criteria: combined Choke Canyon/Lake Corpus Christi storage would need to exceed 30%, compared with about 14% now. Staff described Formosa water as an insurance supply given reduced deliveries from the Colorado River and Lake Texana.

Communications Briefing: Inner Harbor / Water Security Campaigns

• Alisa Olson, Director of Communications, presented three public education campaigns: the local Inner Harbor campaign cost $49,995; the Texas Tribune statewide campaign cost $30,000; and the four-tier water security campaign cost approximately $43,000. Council members noted the total was roughly $123,000.
• The Inner Harbor website is cctx.info/innerharbor. The campaign includes paid social media, Google search/display ads, radio, TV, and billboards. The Texas Tribune campaign had more than 100,000 website impressions, more than 80,000 email impressions, and more than 900 clicks.
• Council members were split. Some questioned spending before final desalination approval and called the campaign "propaganda," while others defended public education, noted prior councils requested it, and said education is needed. Councilman Hernandez cautioned that government campaigns can be perceived as propaganda; Councilman Roy defended the campaign and criticized opposition misinformation. Councilwoman Vaughn asked for more conservation and drought-crisis messaging. Councilwoman Bond said council members remain committed to finding water.

Consent Agenda

• Items 5-11 were approved by one motion; no council member or citizen pulled an item.
• Approved items included: the May 6, 2025 regular meeting minutes; Health Department grant renewals up to $2,772,910 and 32 grant positions; real estate sales contracts totaling up to $1,534,880 for the Nueces River Water Pump Station plus short-term leases; an ADK Environmental vactor/preventative maintenance agreement up to $255,000, with up to $765,000 if options are exercised; a Mako Contracting Huntwick Avenue reconstruction contract up to $954,452.20; nomination of CITGO as a Texas Enterprise Zone single enterprise project; and an ordinance prohibiting crossing buoy markers at Choke Canyon Reservoir with a penalty not to exceed $500.

Executive Session and Housing Authority Action

• The Council entered executive session on items 14 and 15: legal consultation and deliberation concerning potential property purchase/value involving the Corpus Christi Housing Authority, and legal consultation regarding proposed legislation on water rate appeals.
• After reconvening, City Manager Zanoni publicly stated that the Corpus Christi Housing Authority had removed hundreds of millions of dollars in taxable property from tax rolls. He estimated the impact to the city at $3.5 million in initial lost revenue, rising to up to $7 million if all transactions occur. He emphasized that the City Council did not authorize or vote on those transactions.
• Councilwoman Paxson moved, and the Council unanimously adopted, a resolution authorizing active opposition to "improper and/or illegal" use of property tax exemptions by Corpus Christi Housing Authority affiliates and connected entities. Councilman Hernandez expressed caution about the word "illegal" but supported the resolution as written.

Individual Consideration: Texas Moving Image Incentive Resolution

• The Council approved a resolution supporting Senate Bill 22 and House Bill 4568, which would create the Texas Moving Image Industry Incentive Program and Fund.
• Councilman Hernandez and Councilman Scott spoke in support, saying the state incentive would make Texas competitive for film production. Councilman Barrera shared a personal story about his daughter leaving Texas for film work after incentives dried up. The motion carried.

Individual Consideration: FY2025 Plan of Finance / COs

• Victor Kidogo presented the FY 2025 financing plan: five transactions totaling $379,825,000, including $259,320,000 for project funding and about $120 million for utility debt refinancing. The refinancing is expected to generate about $5.7 million in interest savings. The city carries AA credit ratings, and past refinancings over 10 years saved about $272 million.
• Finance staff requested approval of the Notice of Intention to issue up to $43,200,000 in Certificates of Obligation for FY 2025 Capital Budget items. Allocations included $4.4 million for solid waste, $4.1 million for public health and safety, $14 million for streets, $6 million for stormwater, $11.9 million for parks and recreation, and $2.5 million for public facilities.
• Council debate focused on certificates of obligation. Some members opposed broad use; City Manager Zanoni said he did not recommend new COs in the current budget and that future projects would go through voter-approved bond programs rather than COs, except for rollovers. Other members defended COs as a bridge for cost overruns and long-lead projects. The resolution was approved.

Briefing: Grant Activity Update

• The Finance Director presented the grant activity update. Grant functions were centralized under Finance starting in FY 2022, and the city currently has one filled grant writer position out of two budgeted positions.
• In the prior fiscal year, the city was awarded about $17.7 million in grants and had about $53.2 million in grant expenditures, including about $22 million in ARPA funds.
• As of March 31 in the current fiscal year, the city had applied for about $35.6 million in grants and been awarded about $38.8 million. Grants ranged from about $1,000 to $16 million; larger awards included about $12.2 million for aviation, about $15 million for CCW, and about $2.4 million for NAS.
• Council discussion emphasized the need to analyze grant writer capacity, prioritize departments, and create funding for grant matches. Staff noted the ERP grant module is not yet implemented, and specialized grant applications sometimes require outside consultants, as with the $13 million trestle grant, which required engineering and application costs. No action was taken.

Legislative Session Briefing

• Item 4, the 89th Texas Legislative Session update by Ryan Skrobarczyk, was not presented live. The Council agreed by consensus that he would email the presentation to Council members instead.

Key Outcomes

• Consent agenda items 5-11 were approved by one motion.
• The Council adopted a resolution opposing improper or illegal use of property tax exemptions by Corpus Christi Housing Authority affiliates, unanimously.
• The Council adopted a resolution supporting Senate Bill 22 and House Bill 4568, the Texas Moving Image Industry Incentive Program.
• The Council approved the FY 2025 Plan of Finance and publication of the Notice of Intention to issue up to $43,200,000 in Certificates of Obligation.
• Staff were directed to follow up on earlier ACFR/audit briefing distribution, the Bill Witt Park NASA tracking station panels, cooling center pet and access barriers, and a more detailed grant writer/cost-share analysis.
• Additional alternative water project briefings and the desalination cost model presentation are scheduled for June/July.
• The meeting adjourned after the grant briefing.