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HomeMy WebLinkAbout1979-09-25 - Minutes - e/go * MINUTES OF A RESIDENTIAL HOUSING FACILITIES BOARD MEETING A meeting of the Residential Housing Facilities Board was held on Tuesday, September 25, 1979, at 4:30 P.M. in the Directors Room, City Administration Building, Fayetteville, Arkansas. PRESENT: Chairman F. H. Martin, Dale Christee, George Faucette, Jr. , City Attorney Jim McCord, Angie Medlock, members of the audience and representatives of the news media. ABSENT: Members Ron Pennington and John Dominick. The chairman called the meeting to order at 4:30 P.M. for the purpose of discussing a request for payment of legal services rendered by Locke, Purnell , Boren, Laney and Neely, counsel to Lomas & Nettleton, for services in connection with the Fayetteville residential housing facilities bond issue. Chairman Martin said he had received a letter from John Rauscher asking that the Residential Housing Facilities Board take action on a request for payment of $15,000 for legal services and Rauscher had recommended that $10,000 would be appropriate payment, since the Board had not anticipated these costs. Martin said the costs were incurred by Lomas & Nettleton, as administrator of the loan program, and Lomas & Nettleton were expecting the fees to by paid from the bond surplus. City Attorney Jim McCord quoted from the minutes of the February 9 meeting that "the Board had received proposals from several institutions concerning various types of administrative structures for the bond issue. He also stated that the underwriters had submitted an outline of the proposals". McCord said the chairman had noted that a recommendation was made by the underwriters that Lomas & Nettleton be selected as Administrator of the program, and after a short discussion, Dale Christy moved to accept the recommendations. McCord said there was some reference on page 21 of a 25 page proposal submitted by Lomas & Nettleton that they expecte& "payment of their reasonable legal counsel fees". McCord said however, that he had not found any written contract between the City and Lomas & Nettleton. McCord stated further that when this firm brought their statement to the Little Rock Public Facilities Board, after negotiations, Little Rock agreed to pay $11,000. Thecity attorney advised the Board that they would need to decide if payment is due for legal services incurred by the administrator, and if so, how much. Chairman Martin asked McCord if the Board does not have either a written or expressed contract stating that they will pay attorney's fees for the administrator and McCord said no. Chairman Martin explained that the statement for legal fees had been given to Rauscher Pierce in April at the bond closing and John Rauscher had explained to them at that time that their fees had not been included in the initial expenses. ' Residential Housing .Facilities Meeting September`25, 1979 Page 2 Mr. Martin said John Rauscher had explained that they had not anticipated this fee and the final decision on payment would have to come from the Residential Housing Facilities Board. Martin noted also that there is a surplus of $17,000 in the Cost of Issuance account. George Faucette Jr. commented that he was aware that the attorneys had been present at an earlier meeting and were working on the issue, but he felt they were being paid by Lomas & Nettleton and did not think the money would be coming out of the bond proceeds. Dale Christee asked if there had been any reference to the counsel 's fee by Lomas and Nettleton and City Attorney Jim McCord said there had not been. Martin commented that the Residential Housing Facilities Board had accepted Rauscher Pierce' s recommendation for administrator of the program but the minutes of that meeting do not reflect that the Board accepted any proposal from Lomas & Nettleton. McCord noted that the attachments to the minutes of that meeting contained provision for an initial fee of $4,000 for Lomas & Nettleton and an estimate for recurring fees to continue the program. Dale Christee stated that he doen't feel any obligation for the attorney' s fee. He said he feels the Board had accepted the recommendation for the under- writer at a fee that was agreeable and he had anticipated that the underwriter would absorb whatever fees would be incurred in administering the program. He said at this point, he doesn' t feel the Board should assume any more obligations of the cost of issuance of the bonds. Dale Christee noted that the underwriter had not anticipated any further fees either--they had only anticipated bond counsel and underwriter' s counsel fees. • Dale Christee moved to deny payment of the attorney' s fees, based on what they now know. George Faucette Jr. seconded the motion which passed 3-0 with Dominick and Pennington absent. There being no further business for the Board' s consideration, the meeting adjourned at 4:55 P.M.