Public calls for disbandment
The Scurry County Local Government Corporation (LGC) is ready to invest taxpayer money.
During Friday’s meeting, the board approved a memorandum of understanding and letter of authorization for U.S. Consults, LLC, to act on the LGC’s behalf. But prior to the meeting beginning, several citizens said the LGC should be dissolved. Twenty people, including elected officials, were in attendance Friday night.
“This is not something the public supports. Since this is a non-disclosure thing, we are not happy with that. We would like to see a change,” Mel Heard said prior to the meeting. “The election said we don’t want this. This cost you (board chairman and County Judge Ricky Fritz) the election.”
Pct. 2 Scurry County Commissioner candidate Morgan West said other taxing entities have not put money into the LGC and should not be entitled to funding.
“These boards did not approve for them to serve. To me they are private citizens,” he said.
On Tuesday, the commissioners’ court approved naming Snyder ISD Superintendent Dr. Eddie Bland to the board. The LGC board then appointed Snyder City Manager Merle Taylor, WTC President Dr. Barbara Beebe and Cogdell Memorial Hospital CEO Ella Helms to the board after the bylaws were amended to have a six-member board.
Heard and West also said they did not approve of the board members signing non-disclosure agreements because public funds are being used.
“This is public money, not your money,” Heard said pointing to Fritz and then board member and Pct. 1 County Commissioner Terry Williams.
After Heard left the courtroom, Fritz called the meeting to order and no further public comments were allowed.
The board approved the memorandum of understanding and authorization letter, but Bland emphasized that it does not mean U.S. Consults will be spending any money on investments.
“They can’t make the deal,” he said. “They will have to bring the information to us for review.”
Fritz said any discussions on investments would be held in open session of the LGC.
The memorandum states that the LGC and U.S. Consults “shall use best efforts to procure and finalize contracts with third parties regarding either (a) the purchase of crude oil or natural gas, and/or (b) the purchase of mineral interests including, but not limited to, production payments and other forms of royalty interests.”
The documents also state that U.S. Consults will be the sole and exclusive representative of the LGC.
U.S. Consults, according to the document, has “identified several prospective counterparties that have the financial capability to perform, as well as the desire to enter into long-term agreements (including agreements with up to 30 years of commitments)” with the LGC.
Prior to voting on the documents, Bland asked if County Attorney Mike Hartman had reviewed them. Fritz said that Hartman signed off on the documents.
Board members also approved a distribution plan in the event any revenue is produced from the investment. However, Bland said the investments may never come about.
“Before getting involved, I made sure that if this fails, it does not fall back on the taxpayers,” Bland said. “There may never be additional revenue from this. But a process is in place to distribute those funds. If this does not work, all of the (current funds) will go back to the county.”
The board approved allocating 18 percent to Snyder ISD and 14 percent each to Scurry County, the City of Snyder, WTC and Scurry County Hospital District. Six percent would be allocated between Hermleigh and Ira ISDs, as well as those communities.
The remaining 20 percent will be returned to the LGC and could be used for quality of life projects throughout the county, Fritz said.
Bland said if any revenue is seen from the investments, the entities could use those funds to help payoff long-term debt, like the school district’s construction project or the county law enforcement center.
“If we can pay off those debts, we can lower the tax rate,” Bland said.
Bland also addressed the non-disclosure agreements officials signed with U.S. Consults.
“I don’t like non-disclosures either, but I understand the potential that this could be good for the county, city, schools and everyone,” he said. “That is what hooked me.”
Fritz said he heard complaints that the investments could hurt current oil royalty owners in the county.
“Nothing I have seen will do that,” he said, but would not give specific details or examples citing the non-disclosure agreement.
Prior to voting on the distribution plan, Helms said the board should meet again and discuss amending the bylaws to reflect that the percentages cannot change for a calendar year unless by unanimous vote of the six-member board.
Also prior to the meeting, Heard and West asked when they could receive a copy of the new bylaws and whether they would have to be requested through the Freedom of Information Act. Fritz did respond to the second question, saying the bylaws would be available to the public in two weeks, after he returns from vacation.