~;?S;'-' · 2015-01-20 · 2 ADDENDUM CITY COUNCIL MEETING JANUARY 27, 2010 ADDITIONS: (Continued)...

JANUARY 27, 2010 CITY COUNCIL ADDENDUMCERTIFICATION

This certification is given pursuant to Chapter XI, Section 9 of the City Charter for theCity Council Addendum dated January 27, 2010. We hereby certify, as to thosecontracts, agreements, or other obligations on this Agenda authorized by the CityCouncil for which expenditures of money by the City are required, that all of the moneyrequired for those contracts, agreements, and other obligations is in the City treasury tothe credit of the fund or funds from which the money is to be drawn, as required andpermitted by the City Charter, and that the money is not appropriated for any otherpurpose.

ary K. SuhmCity Manager

~;?S;'-"'Edward Scott (City Controller

Date

ADDENDUM

CITY COUNCIL MEETING JANUARY 27, 2010 CITY OF DALLAS

1500 MARILLA COUNCIL CHAMBERS, CITY HALL

DALLAS, TEXAS 75201 9:00 A. M.

ADDITIONS: Closed Session 6ES Attorney Briefings (Sec. 551.071 T.O.M.A.) - Beverly Davis v. City of Dallas, Civil Action No. 3:08-CV-1123-B - Roosevelt Holiday v. City of Dallas, et al., Civil Action No. 3:08-CV-2110-D - City of Dallas v. Thos. S. Byrne Ltd., f/k/a Thos. S. Byrne, Inc. and Halff Associates, Inc.

v. Steel Lite Roofing, Inc.; Redland Ins. Co.; J & J Roofing Co.; and Travelers Casualty and Surety Co.; Cause No. 08-01181-1

CONSENT ADDENDUM Aviation 1. Authorize (1) the issuance, sale, and delivery of Love Field Airport Modernization

Corporation (“LFAMC” or “Issuer”) special facilities revenue bonds in one or more series, guaranteed by Southwest Airlines Co. (“Southwest”), subject to certain parameters; (2) the LFAMC to enter into all agreements and instruments to which the Issuer is a party in connection with the issuance of its bonds, including, but not limited to, a special facility agreement, a trust indenture, and a bond purchase agreement; (3) the LFAMC and its consultants to take all other actions deemed necessary in connection with the issuance of the LFAMC special facilities revenue bonds including the engagement of the bond underwriters, trustee, co-bond counsel, and co-financial advisors; (4) the City Manager to enter into a special facility agreement and a revenue credit agreement; and (5) other actions by the LFAMC and the City Manager deemed necessary in connection with the foregoing - Financing: No cost consideration to the City

Business Development & Procurement Services 2. Authorize (1) an acquisition contract for the purchase and implementation of software

and hardware for a records management system for Police, Court & Detention Services and Dallas-Fire Rescue to replace the legacy mainframe system in the amount of $4,910,627; and (2) a five-year service contract for maintenance and support for a records management system in the amount of $2,484,902 - Unisys Corporation, most advantageous proposer of five - Total not to exceed $7,395,529 - Financing: Current Funds ($3,153,903) (subject to annual appropriations), Urban Area Security Initiative Grant Funds ($3,602,385) and 2008 Equipment Acquisition Contractual Obligation Notes ($639,241)

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ADDENDUM CITY COUNCIL MEETING

JANUARY 27, 2010

ADDITIONS: (Continued) CONSENT ADDENDUM (Continued) City Controller’s Office 3. Authorize the preparation of plans for the issuance of the Combination Tax and

Revenue Certificates of Obligation, Series 2010 in an amount not to exceed $23,000,000; and enacting other provisions in connection therewith - Financing: No cost consideration to the City

4. Authorize the preparation of plans for the issuance of General Obligation Refunding and

Improvement Bonds, Series 2010 in an amount not to exceed $164,500,000 - Financing: No cost consideration to the City

Human Resources 5. Authorize a contract with Dallas Area Rapid Transit for the purchase of 450 annual

passes in support of the City's 2008 clean air initiative - Not to exceed $147,951 - Financing: Current Funds (to be reimbursed by participating employees)

Public Works & Transportation Note: Addendum Item Nos. 6 and 7 Fiji-Compton Project must be considered collectively. 6. * Authorize (1) a contract for the construction of paving and drainage improvements

for Avenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji Street, Sphinx Street, Tonga Street, and associated alleys with Alta Construction Services, Inc., lowest responsible bidder of six; and (2) assignment of the construction contract to Sphinx Development Corporation for construction administration and material testing - Not to exceed $1,818,799 - Financing: Capital Projects Reimbursement Funds

7. * Authorize Amendment No. 2 to the Development Agreement with Sphinx

Development Corporation to revise the payment method of the construction contract - Financing: No cost consideration to the City

3


JANUARY 27, 2010

ADDITIONS: (Continued) CONSENT ADDENDUM (Continued) Public Works & Transportation (Continued) Note: Addendum Item Nos. 8, 9 and 10 Katy Trail, Phase III must be considered collectively. 8. * Authorize (1) a contract with JRJ Paving, L.P., lowest responsible bidder of eleven,

for construction of Katy Trail, Phase III from McCommas Street to Sandhurst Street in an amount not to exceed $809,298; (2) the receipt and deposit of funds from the Texas Department of Transportation in an amount not to exceed $647,438; and (3) an increase in appropriations in the amount of $647,438 in the Capital Projects Reimbursement Fund - Total not to exceed $809,298 - Financing: 1998 Bond Funds ($161,860) and Capital Projects Reimbursement Funds ($647,438)

9. * Authorize a license agreement with Dallas Area Rapid Transit for the use of DART

right-of-way to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Avenue - Financing: No cost consideration to the City

10. * Authorize a license agreement with ONCOR for the use of ONCOR right-of-way to

construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Avenue - Financing: No cost consideration to the City

Sustainable Development and Construction 11. A resolution declaring an un-developable City-owned tract of land containing

approximately 780 square feet located near the intersection of Shady Trail and Southwell Road as unwanted and unneeded and authorize its sale to William B. Jordan, the abutting owner - Revenue: $5,800

ITEMS FOR INDIVIDUAL CONSIDERATION DESIGNATED PUBLIC SUBSIDY MATTERS Economic Development 12. Authorize (1) amendments to the Dallas Development Fund’s certificate of formation

and bylaws; and (2) the City Manager to file the amended certificate of formation with the Secretary of State - Financing: No cost consideration to the City

4


JANUARY 27, 2010

ADDITIONS: (Continued) ITEMS FOR INDIVIDUAL CONSIDERATION (Continued) DESIGNATED PUBLIC SUBSIDY MATTERS (Continued) Housing/Community Services 13. Authorize a loan in the amount of $2,000,000 at 2% interest to FC Continental Complex,

L.P. for the acquisition of property located at 1810 Commerce Street and for conversion of the vacant commercial building into 199 residential rental units and 5,000 square feet of retail space, in accordance with the Downtown Connection Tax Increment Financing District Project Plan & Reinvestment Zone Financing Plan - Not to exceed $2,000,000 - Financing: Downtown Connection Tax Increment Financing District Funds

CORRECTIONS: Business Development & Procurement Services 6. Authorize a service contract for the purchase and installation of furniture to complete the

renovation of the Children's Center and shipping and receiving area for the inter-library loan at the J. Erik Jonsson Central Library – Intelligent Interiors, Inc. in the amount of $106,262, Putsi, Inc. dba Cultural Surroundings in the amount of $47,691, BKM Total Office of Texas, LLC. in the amount of $24,177 and Wilson Project Management in the amount of $7,519, lowest responsible bidders of ten - Total not to exceed $185,649 - Financing: 2003 Bond Funds ($137,958 $138,814) and 2006 Bond Funds ($47,691 $46,835)

Sustainable Development and Construction 32. A resolution authorizing the conveyance of a total of approximately 126,3689 square

feet of land to the State of Texas located at Dallas/Fort Worth International Airport near the intersections of State Highway 183 and Valley View Lane and State Highway Business 114 and Dallas Road in exchange for the dedication of a total of approximately 126,368129,156 square feet of land located near the intersections of North Belt Line Beltline Road and State Highway 161 and State Highway 360 and FAA Boulevard from the State of Texas - Financing: No cost consideration to the City

5


JANUARY 27, 2010 DELETIONS: City Attorney’s Office 9. Authorize settlement of a claim filed by Maria Cardenas, Claim No. 08208894 - Not to

exceed $9,700 - Financing: Current Funds Economic Development 45. Authorize a Special Economic Development Loan Agreement, and two Commercial

Loan Agreements to enhance the quality of life for the residents in the South Dallas/Fair Park Trust Fund target area to provide funding as follows: (1) Richard Knight d/b/a the MLK/175 Gateway Project in an amount not to exceed $92,800; (2) Freedom Fashions in an amount not to exceed $50,000; and (3) Namamai Services, LLC in an amount not to exceed $50,000 - Total not to exceed $192,800 - Financing: South Dallas/Fair Park Trust Funds

ADDENDUM DATEITEM IND

# OK DEF DISTRICT TYPE DEPT. DOLLARS LOCAL MWBE DESCRIPTION

1 14 C AVI NC NA NA

Authorize the issuance, sale, and delivery of Love Field Airport Modernization Corporation (“LFAMC” or“Issuer”) special facilities revenue bonds in one or more series, guaranteed by Southwest Airlines Co.(“Southwest”), subject to certain parameters; the LFAMC to enter into all agreements and instruments towhich the Issuer is a party in connection with the issuance of its bonds, including, but not limited to, aspecial facility agreement, a trust indenture, and a bond purchase agreement; the LFAMC and itsconsultants to take all other actions deemed necessary in connection with the issuance of the LFAMCspecial facilities revenue bonds including the engagement of the bond underwriters, trustee, co-bondcounsel, and co-financial advisors; the City Manager to enter into a special facility agreement and arevenue credit agreement; and other actions by the LFAMC and the City Manager deemed necessary inconnection with the foregoing

2 All C

PBD, CIS, FIR,

POL, CDS $7,395,529.00 16.33% 16.33%

Authorize an acquisition contract for the purchase and implementation of software and hardware for arecords management system for Police, Court & Detention Services and Dallas-Fire Rescue to replace thelegacy mainframe system; and a five-year service contract for maintenance and support for a recordsmanagement system

3 N/A C CON NC NA NA

Authorize the preparation of plans for the issuance of the Combination Tax and Revenue Certificates ofObligation, Series 2010 in an amount not to exceed $23,000,000; and enacting other provisions inconnection therewith

4 N/A C CON NC NA NAAuthorize the preparation of plans for the issuance of General Obligation Refunding and ImprovementBonds, Series 2010 in an amount not to exceed $164,500,000

5 N/A C HRD $147,951.00 NA NAAuthorize a contract with Dallas Area Rapid Transit for the purchase of 450 annual passes in support of theCity's 2008 clean air initiative

6 4 C PWT $1,818,798.89 24.17% 28.23%

Fiji-Compton Project: Authorize a contract for the construction of paving and drainage improvements forAvenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji, Sphinx and Tonga Streets, andassociated alleys with Alta Construction Services, Inc. and assignment of the construction contract toSphinx Development Corporation for construction administration and material testing

7 4 C PWT NC NA NAFiji-Compton Project: Authorize Amendment No. 2 to the Development Agreement with SphinxDevelopment Corporation to revise the payment method of the construction contract

8 14 C PWT $809,297.92 92.41% 33.36%Katy Trail, Phase III: Authorize a contract with JRJ Paving, L.P., lowest responsible bidder of eleven, forconstruction of Katy Trail, Phase III from McCommas Street to Sandhurst Street

9 14 C PWT NC NA NA

Katy Trail, Phase III: Authorize a license agreement with Dallas Area Rapid Transit for the use of DARTright-of-way to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to SkillmanAvenue

10 14 C PWT NC NA NAKaty Trail, Phase III: Authorize a license agreement with ONCOR for the use of ONCOR right-of-way toconstruct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Avenue

11 6 C DEV REV $5,800 NA NA

A resolution declaring an undevelopable City-owned tract of land containing approximately 780 square feetlocated near the intersection of Shady Trail and Southwell Road as unwanted and unneeded and authorizeits sale to William B. Jordan, the abutting owner

12

1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 13, 14, 15 I ECO NC NA NA

Authorize amendments to the Dallas Development Fund's certificate of formation and bylaws; and the CityManager to file the amended certificate of formation with the Secretary of State

13 14 I HSG $2,000,000.00 NA NA

Authorize a loan in the amount of $2,000,000 at 2% interest to FC Continental Complex, L.P. for theacquisition of property located at 1810 Commerce Street and for conversion of the vacant commercialbuilding into 199 residential rental units and 5,000 square feet of retail space, in accordance with theDowntown Connection Tax Increment Financing District Project Plan & Reinvestment Zone Financing Plan

TOTAL

January 27, 2010

$12,171,576.81Page 1

ADDENDUM ITEM # 1KEY FOCUS AREA: Economic Vibrancy

AGENDA DATE: January 27, 2010

COUNCIL DISTRICT(S): 14

DEPARTMENT: Aviation

CMO: A. C. Gonzalez, 671-8925

MAPSCO: 34E________________________________________________________________

SUBJECT

Authorize (1) the issuance, sale, and delivery of Love Field Airport Modernization Corporation (“LFAMC” or “Issuer”) special facilities revenue bonds in one or more series, guaranteed by Southwest Airlines Co. (“Southwest”), subject to certain parameters; (2) the LFAMC to enter into all agreements and instruments to which the Issuer is a party in connection with the issuance of its bonds, including, but not limited to, a special facility agreement, a trust indenture, and a bond purchase agreement; (3) the LFAMC and its consultants to take all other actions deemed necessary in connection with the issuance of the LFAMC special facilities revenue bonds including the engagement of the bond underwriters, trustee, co-bond counsel, and co-financial advisors; (4) the City Manager to enter into a special facility agreement and a revenue credit agreement; and (5) other actions by the LFAMC and the City Manager deemed necessary in connection with the foregoing - Financing: No cost consideration to the City

BACKGROUND

On June 11, 2006, the City entered into the Five Party Agreement with the City of Fort Worth, The Dallas-Fort Worth International Airport Board, American Airlines, Inc., and Southwest to further the repeal of Love Field flight restrictions imposed by the Wright Amendment. The Five Party Agreement obligated the City to modernize Love Field, through the Love Field Modernization Program (“LFMP”).

The LFMP includes the design and construction of all of the facilities, infrastructure systems and equipment for the operation of a modernized terminal/concourse complex at Dallas Love Field, including the terminal building, aircraft parking apron, fueling system, baggage handling systems, roadways and terminal curbside, and other supporting infrastructure encompassed within the elements of the LFMP.

Agenda Date 01/27/2010 - page 2

BACKGROUND (Continued)

In order to successfully complete the LFMP, the City authorized the creation of a local government corporation, the LFAMC, pursuant to the requirements of Chapter 431, Subchapter D of the Texas Transportation Code to aid, assist, and act on behalf of the City in the performance of its governmental functions to facilitate the LFMP and provide a mechanism for financing its costs.

This Resolution will authorize the LFAMC to issue, sell, and deliver LFAMC special facilities revenue bonds, in one or more series, guaranteed by Southwest (“Bonds”), in an aggregate principal amount not to exceed $500,000,000, subject to certain parameters. The net effective interest rate on the Bonds shall not exceed 8% and the term of the Bonds shall not exceed 30 years. The form of the LFAMC Bond Resolution is attached hereto as Exhibit A. In consideration of Southwest's desire to manage the LFMP, Southwest will be obligated to make 100% of the debt service payments on the Bonds as required under the special facility agreement, attached hereto in substantially final form as Exhibit B, backed by Southwest’s guaranty to the trustee. Under a revenue credit agreement, attached hereto in substantially final form as Exhibit C, the City will reimburse Southwest the amount of debt service that Southwest is required to pay on the Bonds, subject to potential offsets held by the trustee, to the extent the City receives airport revenues, after payment of operation and maintenance expenses and funding operation and maintenance reserves, and payment of general airport revenue bond debt service and funding general airport revenue bond reserves, for funding the reimbursement to Southwest.

This Resolution will also authorize: (1) the LFAMC to enter into all agreements and instruments to which the Issuer is a party in connection with the issuance of its bonds, including, but not limited to, a special facility agreement, a trust indenture, and a bond purchase agreement; (2) the LFAMC and its consultants to take all other actions deemed necessary in connection with the issuance of the LFAMC special facilities revenue bonds including the engagement of the bond underwriters, trustee, co-bond counsel, and co-financial advisors; (3) the City Manager to enter into a special facility agreement and a revenue credit agreement; and (4) other actions by the LFAMC and the City Manager deemed necessary in connection with the foregoing.

PRIOR ACTION / REVIEW (COUNCIL, BOARDS, COMMISSIONS)

Briefed to the Budget, Finance, and Audit Committee, on the LFMP plan of finance, on January 11, 2010.

Briefed to the Budget, Finance, and Audit Committee and the Transportation and Environment Committee, on the LFMP plan of finance, on December 14, 2009.

Briefed to the Budget, Finance, and Audit Committee and the Transportation and Environment Committee, on the LFMP plan of finance, on September 15, 2009.


PRIOR ACTION / REVIEW (COUNCIL, BOARDS, COMMISSIONS) (Continued)

Approved airport use and lease agreements with Southwest, American Airlines, Inc., and Continental Airlines, Inc., by Resolution Nos. 08-3403, 08-3405, and 08-3404, on December 10, 2008.

Approved the Program Development Agreement, by Resolution No. 08-3117, on November 10, 2008.

Approved the creation of the LFAMC and the Southwest inducement resolution, by Resolution Nos. 08-1876 and 08-1875, on June 25, 2008.

Approved the Five Party Agreement, by Resolution No. 06-1838, on June 28, 2006.

FISCAL INFORMATION

No cost consideration to the City.

EXHIBIT A

CERTIFICATE FOR RESOLUTION THE STATE OF TEXAS LOVE FIELD AIRPORT MODERNIZATION CORPORATION We, the undersigned officers of said Board of Directors, hereby certify as follows: 1. The Board of Directors of said Corporation convened in its REGULAR MEETING ON THE ____ DAY OF __________, 2010, at the designated meeting place, and the roll was called of the duly constituted officers and members of said Board of Directors, to-wit: Ryan S. Evans President Daniel T. Weber Vice President David K. Cook Secretary and Treasurer Bob Montgomery Ex-Officio Member and all of said persons were present, except the following absentees: ______, thus constituting a quorum. Whereupon, among other business the following was transacted at said Meeting: a written

RESOLUTION AUTHORIZING THE ISSUANCE OF LOVE FIELD AIRPORT MODERNIZATION CORPORATION

SPECIAL FACILITIES REVENUE BONDS, SERIES 2010 (SOUTHWEST AIRLINES CO. – LOVE FIELD MODERNIZATION PROGRAM PROJECT);

THE EXECUTION OF A SPECIAL FACILITIES AGREEMENT, A TRUST INDENTURE

AND A BOND PURCHASE AGREEMENT; APPROVING THE USE OF A PRELIMINARY OFFICIAL

STATEMENT AND THE USE AND EXECUTION OF A FINAL OFFICIAL STATEMENT;

AND RESOLVING OTHER MATTERS PERTAINING THERETO was duly introduced for the consideration of said Board of Directors and read in full. It was then duly moved and seconded that said Resolution be adopted and, after due discussion, said motion, carrying with it the adoption of aid Resolution, prevailed and carried by the following vote: AYES: NOES: ABSTENTIONS:

EXHIBIT A

2. That a true, full and correct copy of the aforesaid Resolution adopted at the Meeting described in the above and foregoing paragraph is attached to and follows this Certificate; that said Resolution has been duly recorded in said Board of Director's minutes of said Meeting; that the above and foregoing paragraph is a true, full and correct excerpt from said Board of Director's minutes of said Meeting pertaining to the adoption of said Resolution; that the persons named in the above and foregoing paragraph are the duly chosen, qualified, and acting officers and members of said Board of Directors as indicated therein; that each of the officers and members of said Board of Directors was duly and sufficiently notified officially and personally, in advance, of the time, place, and purpose of the aforesaid Meeting, the that said Resolution would be introduced and considered for adoption at said Meeting, and each of said officers and members consented, in advance, to the holding of said Meeting for such purpose, and 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. SIGNED AND SEALED the ____ day of __________, 2010. Secretary President (SEAL)

EXHIBIT A

RESOLUTION AUTHORIZING THE ISSUANCE OF LOVE FIELD AIRPORT MODERNIZATION CORPORATION

SPECIAL FACILITIES REVENUE BONDS, SERIES 2010 (SOUTHWEST AIRLINES CO. – LOVE FIELD MODERNIZATION PROGRAM PROJECT);

THE EXECUTION OF A SPECIAL FACILITIES AGREEMENT, A TRUST INDENTURE

AND A BOND PURCHASE AGREEMENT; APPROVING THE USE OF A PRELIMINARY OFFICIAL

STATEMENT AND THE USE AND EXECUTION OF A FINAL OFFICIAL STATEMENT;

AND RESOLVING OTHER MATTERS PERTAINING THERETO WHEREAS, Love Field Airport Modernization Corporation (the "Corporation") is a nonstock, nonprofit local government corporation organized and existing under the laws of the State of Texas, including particularly Subchapter D of Chapter 431, Texas Transportation Code (the "Act"), and is a duly constituted public instrumentality of the City of Dallas, Texas (the "City"), a political subdivision of the State of Texas, within the meanings of the regulations of the United States Treasury Department and the rulings of the Internal Revenue Service prescribed and promulgated pursuant to section 103 of the Internal Revenue Code of 1986, as amended (the "Code"), and the Corporation is functioning and acting solely on behalf of the City; and WHEREAS, the City is the owner of Dallas Love Field (hereinafter defined and referred to as the “Airport”), which is located in the City of Dallas, Dallas County, Texas; and WHEREAS, on July 11, 2006, the City, the City of Fort Worth, The Dallas-Fort Worth International Airport Board, Southwest Airlines Co. (“Southwest”) and American Airlines, Inc. entered into that certain “Contract Among The City of Dallas, The City of Fort Worth, Southwest Airlines Co., American Airlines, Inc., and DFW International Airport Board incorporating the Substance of the Terms of the June 15, 2006, Joint Statement Between the Parties to Resolve the ‘Wright Amendment’ Issues” (the “Five Party Agreement”) affecting Dallas Love Field wherein, among other things, the parties thereto agreed to seek to eliminate restrictions on air service at the Airport set forth in existing federal legislation (commonly referred to as the “Wright Amendment”); and WHEREAS, on October 13, 2006, Public Law 109-352, commonly known as the “Wright Amendment Reform Act of 2006" was signed into law; and WHEREAS, the Wright Amendment Reform Act of 2006 provides that the interstate flight restrictions imposed on the Airport since 1979 will be lifted on October 13, 2014, in accordance with other terms and conditions set forth in the Wright Amendment Reform Act of 2006; and WHEREAS, in the Five Party Agreement, the City and Southwest agreed to the significant redevelopment of portions of the Airport, including the modernization of the

EXHIBIT A

existing terminal facilities at the Airport, a program referred to as the “Love Field Modernization Program” or “LFMP”, and the City and Southwest agreed to work toward completion of the LFMP by October 2014, eight (8) years from the enactment of the Wright Amendment Reform Act of 2006; and WHEREAS, following enactment of the Wright Amendment Reform Act of 2006, the City retained consultants to perform a terminal area master plan, a plan referred to as the “Terminal Area Redevelopment Program Study” or “TARPS”, establishing the requirements and criteria for terminal expansion and modernization and, in a parallel effort, Southwest retained consultants to explore alternative conceptual layouts for terminal redevelopment, including the alternative conceptual layout that has been identified by the City and Southwest as “Option C”; and WHEREAS, on June 25, 2008, by Resolution No. 08-1877, the Dallas City Council approved a “Term Sheet” negotiated by the City and Southwest in which the consultant recommendations were adopted, establishing the consensus recommendation that Option C is the preferred concept for the LFMP and will satisfy the requirements defined in the TARPS; and WHEREAS, to facilitate the development of the LFMP, the City created the Corporation to act on behalf of the City in the performance of its governmental functions to promote the development of the geographic area of the City included at or in the vicinity of the Airport, in furtherance of the promotion, development, encouragement, and maintenance of employment, commerce, aviation activity, tourism and economic development in the City; and WHEREAS, in furtherance of the development of the LFMP, the City, the Corporation and Southwest entered into that certain Program Development Agreement, dated January 15, 2009 (the “Program Development Agreement”); and WHEREAS, in furtherance of the provisions of the Five Party Agreement, the City and Southwest entered into that certain Amended and Restated Lease of Terminal Building Premises, effective October 1, 2008 (the “Airport Use and Lease Agreement”); and WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the City and Southwest are undertaking the LFMP, a major capital program to improve and modernize terminal facilities at the Airport; and WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the Corporation, at the request of Southwest, shall issue bonds to finance elements of the LFMP; and

EXHIBIT A

WHEREAS, the Corporation is empowered by the Act to issue revenue bonds to fulfill the purposes for which it was created; WHEREAS, Southwest has requested that the Corporation shall consider the issuance of its Special Facilities Revenue Bonds, in one or more series (hereinafter referred to as the “Series 2010 Bonds”), in the manner hereinafter provided, for the purpose of funding elements of the LFMP, as more fully described in the hereinafter defined Facilities Agreement; and WHEREAS, in connection with the sale of the Series 2010 Bonds, the Corporation, the City and Southwest shall execute and deliver that certain Special Facilities Agreement, dated as of February 1, 2010 (the "Facilities Agreement"); and WHEREAS, the Series 2010 Bonds shall be issued under and pursuant to the terms of that certain Trust Indenture (the "Indenture"), dated as of February 1, 2010, by and between the Corporation and Wells Fargo Bank, National Association, as trustee (the "Trustee"); and WHEREAS, Southwest will execute and deliver to the Trustee a Guaranty, dated as of February 1, 2010, to provide for an unconditional guarantee of the payment of the principal of, premium, if any, and interest on the Series 2010 Bonds; WHEREAS, the Series 2010 Bonds are to be issued and delivered pursuant to this Resolution, the Indenture and applicable laws, including the Act; WHEREAS, Southwest has agreed in the Facilities Agreement that it will be unconditionally obligated to make or pay, or cause to be made or paid, to the Trustee certain payments in amounts sufficient to pay and redeem, and provide for the payment and redemption of, the principal of, premium, if any, and interest on the Series 2010 Bonds (the "Facilities Payments"); WHEREAS, as security for the payment of the Series 2010 Bonds, the Corporation agrees and, pursuant to the terms of the Indenture, does assign its right, title and interest in and to the Facilities Payments to the Trustee as part of the Trust Estate; WHEREAS, it is deemed necessary and advisable that this Resolution be adopted; and WHEREAS, the terms contained but not otherwise defined in this Resolution shall have the same meanings as defined in the Master Glossary of Terms, attached to the Facilities Agreement as Exhibit A, unless the context or use herein indicates another meaning or intent. THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF LOVE FIELD AIRPORT MODERNIZATION CORPORATION THAT:

EXHIBIT A

Section 1. RECITALS, DESIGNATION, AMOUNT, AND PURPOSE OF THE BONDS. The Corporation's negotiable bonds designated and to be known as the "LOVE FIELD AIRPORT MODERNIZATION CORPORATION SPECIAL FACILITIES REVENUE BONDS, SERIES 2010 (SOUTHWEST AIRLINES CO. – LOVE FIELD MODERNIZATION PROGRAM PROJECT)" are hereby authorized to be issued in one or more series in an aggregate principal amount not to exceed $500,000,000, FOR THE PURPOSE OF PROVIDING FUNDS TO PAY ALL OR A PORTION OF THE COST OF THE ACQUISITION, CONSTRUCTION, EQUIPPING AND FURNISHING OF THE LFMP, as more fully described in the Facilities Agreement. Section 2. FACILITIES AGREEMENT. The President or Vice President and Secretary of the Board of Directors of the Corporation are hereby authorized to sign, seal and otherwise execute and deliver, for and on behalf of the Corporation, the Facilities Agreement, in substantially the form attached hereto and made a part hereof for all purposes. Section 3. TRUST INDENTURE. For the purpose of securing the payment of the principal of the Series 2010 Bonds, and the premium, if any, and the interest thereon and for the purpose of providing for and fixing in more detail the rights of the registered owners thereof and of the Corporation, Southwest and the Trustee, and for the purpose of making effective a first lien on and pledge of the payments securing the Series 2010 Bonds, as provided in the Facilities Agreement, the President or Vice President and Secretary of the Board of Directors of the Corporation are hereby authorized to sign, seal and otherwise execute and deliver, for and on behalf of the Corporation, the Indenture, in substantially the form attached hereto and made a part hereof for all purposes. Section 4. BONDS ARE SPECIAL OBLIGATIONS. The obligation to pay the principal of, premium, if any, and interest on the Series 2010 Bonds is solely and exclusively a special obligation of the Corporation and is payable from the Facilities Payments made or directed to be made by Southwest under the Facilities Agreement and other funds constituting the Trust Estate under the Indenture. No other entity, including the City, the State of Texas, any other political subdivision thereof, or any other public body, is obligated, directly, indirectly, contingently, or in any other manner, to pay such principal, premium, or interest from any source whatsoever. The Series 2010 Bonds shall not be considered general obligations of the Corporation, the City, the State of Texas, or any other political subdivision thereof. The registered owners of the Series 2010 Bonds shall never have the right to demand payment of the Series 2010 Bonds out of any funds raised or to be raised by taxation, or from any other funds except the sources described in the Series 2010 Bonds. No property is encumbered by any lien or security interest for the benefit of the registered owners of the Series 2010 Bonds. Section 5. SALE OF THE BONDS. The Series 2010 Bonds are hereby authorized to be sold and shall be delivered to the initial purchasers thereof (the "Underwriters") in accordance with and subject to the terms and conditions set forth in the Bond Purchase Agreement among the Corporation, Southwest and the Underwriters,

EXHIBIT A

which shall be in substantially the form attached hereto. The Series 2010 Bonds to be delivered to the Underwriters shall be registered in the name "Cede & Co." (a nominee of The Depository Trust Company). The President of the Board of Directors of the Corporation is hereby authorized to act on behalf of the Corporation for purposes of executing and delivering the Bond Purchase Agreement, including for the purpose of evidencing the approval by the Corporation of the terms of the Series 2010 Bonds, such as principal amount, purchase price, interest rate, principal maturities and provisions relating to the redemption of the Series 2010 Bonds; provided, that the Series 2010 Bonds shall mature at such time or times not exceeding 30 years from their date and that the interest rate on the Series 2010 Bonds shall not exceed a net effective interest rate in excess of 8.00%. Section 6. OFFICIAL STATEMENT. In connection with the offer and sale of the Series 2010 Bonds by the Underwriters, the use of a preliminary official statement (the "Preliminary Official Statement") in substantially the form attached hereto is hereby approved. The President of the Board of Directors of the Corporation is hereby authorized and directed to cause to be prepared a final Official Statement by making any changes to the Preliminary Official Statement as the Underwriters may determine, in accordance with the terms of the Bond Purchase Agreement described in Section 5 hereof. The Corporation hereby (i) authorizes the Official Statement and the information therein contained to be used by the Underwriters in connection with the public offering and the sale of the Bonds, (ii) consents to the use by the Underwriters prior to the date hereof of the Preliminary Official Statement in connection with the public offering of the Bonds and (iii) authorizes and directs the President of the Board of Directors of the Corporation to execute the Official Statement. Section 7. CUSTODY, APPROVAL, AND REGISTRATION OF BONDS; BOND COUNSEL'S OPINION; AND CUSIP NUMBERS. The President of the Board of Directors of the Corporation is hereby authorized to have control of the Series 2010 Bonds initially issued and delivered hereunder and all necessary records and proceedings pertaining to said Series 2010 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. To the extent required by law, upon registration of the Series 2010 Bonds initially issued and delivered hereunder, the 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 Series 2010 Bonds, and the seal of said Comptroller shall be impressed, or placed in facsimile, on such Certificate. The approving legal opinion of Bond Counsel and the assigned CUSIP numbers may, at the option of the Corporation, be printed on any Series 2010 Bond, but neither shall have any legal effect, and shall be solely for the convenience and information of the registered owners of the Series 2010 Bonds. Section 8. BOOK ENTRY SYSTEM. The Corporation hereby specifically approves the language contained in the Official Statement with respect to establishing a book-entry-only system with The Depository Trust Company ("DTC"). To the extent

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necessary, the President or Vice President of the Board of Directors of the Corporation are hereby authorized to execute and deliver to DTC the Letter of Representations as may be required by DTC to establish said book-entry-only system. Section 9. RULE 15c2-12 CERTIFICATION. The Preliminary Official Statement is hereby deemed final within the meaning of Rule 15c2-12 promulgated under the Securities Exchange Act of 1934, as amended (the "Rule"), except for Permitted Omissions and is accurate and complete, except for Permitted Omissions. As used in this Section 9, "Permitted Omissions" shall mean the offering price, interest rate, selling compensation, aggregate principal amount, principal amount per maturity, delivery dates, ratings, identity of the Underwriters and other terms of the Series 2010 Bonds depending on such matters, all with respect to the Series 2010 Bonds. Section 10. FURTHER ACTIONS. The President, Vice President and Secretary of the Board of Directors of the Corporation, and other officers of the Corporation, are hereby authorized to execute and deliver such other instruments, certificates, documents or papers and to take such further action and perform such other duties as such officers may deem advisable or appropriate to carry out the intent of the foregoing sections of this Resolution, or to effect the timely delivery of the Series 2010 Bonds, or to consummate any of the matters or transactions referred to in or contemplated by such Bond Purchase Agreement described in Section 5 hereof.

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SPECIAL FACILITIES AGREEMENT By and Among

LOVE FIELD AIRPORT MODERNIZATION CORPORATION CITY OF DALLAS, TEXAS and SOUTHWEST AIRLINES CO. Dated as of __________, 2010

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TABLE OF CONTENTS

PARTIES ............................................................................................................................................1 ARTICLE I DEFINITIONS....................................................................................................................2 ARTICLE II CONSTRUCTION OF THE PROJECT; REPRESENTATIONS AND WARRANTIES...................................................................3 Section 201. Construction of the Project .................................................................................................3 Section 202. Representations and Warranties by the Corporation...........................................................3 Section 203. Representations and Warranties by the City .......................................................................4 Section 204. Representations and Warranties by Southwest ...................................................................4 ARTICLE III COMMENCEMENT AND COMPLETION OF PROJECT; ISSUANCE OF BONDS.............................................................................5 Section 301. Construction of the Project .................................................................................................5 Section 302. Agreement to Issue Bonds; Application of Proceeds; Southwest Required to Pay Costs of Construction if Bond Proceeds Insufficient ..........................................6 Section 303. Construction Fund...............................................................................................................6 Section 304. Establishment of the Completion Date, Other Completion Certificates .............................7 Section 305. Southwest to Pursue Remedies Against Contractors, Subcontractors and Suppliers and Their Sureties...........................................................8 Section 306. Ownership of Improvements...............................................................................................8 ARTICLE IV TERM .................................................................................................................................8 ARTICLE V FACILITIES PAYMENTS.................................................................................................8 Section 501. Facilities Payments .............................................................................................................8 Section 502. Place of Payments...............................................................................................................8 Section 503. Assignment of Rights..........................................................................................................8 Section 504. Obligations of Southwest Hereunder Unconditional ..........................................................9 Section 505. Payments to Corporation.....................................................................................................9 ARTICLE VI OBLIGATIONS OF SOUTHWEST ..................................................................................9 Section 601. Right to Use Airport ...........................................................................................................9 Section 602. Mechanic’s Liens................................................................................................................9 Section 603. Southwest to Maintain its Corporate Existence; Conditions Under Which Exceptions Permitted.........................................................................................10 Section 604. Tax Exemption..................................................................................................................10 Section 605. Southwest's Covenant Concerning the Bonds...................................................................11 Section 606. Southwest's Obligations Concerning SEC Rule 15c2-12..................................................11 ARTICLE VII RESERVATIONS ............................................................................................................12 Section 701. Improvement, Relocation or Removal of Facilities at the Airport....................................12

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Section 702. Subordination to U.S. Government...................................................................................12 Section 703. War or National Emergency .............................................................................................13 Section 704. Special Obligation of the Corporation ..............................................................................13 Section 705. Responsibility for Contracts for Project and Payment of Facilities Payments .......................................................................................................13 Section 706. Consideration of Amendment ...........................................................................................13 ARTICLE VIII INDEMNITY AND INSURANCE ..................................................................................13 Section 801. Indemnification of Indemnified Parties ............................................................................13 Section 802. Indemnification of the Trustee..........................................................................................14 Section 803. Insurance...........................................................................................................................15 Section 804. Application of Insurance Proceeds ...................................................................................15 Section 805. Right of the City or Trustee to Pay Insurance Premiums..................................................15 Section 806. Right of Southwest or Trustee to Pay Insurance Premiums..............................................15 ARTICLE IX PREPAYMENT OF FACILITIES PAYMENTS .............................................................15 Section 901. In Connection with Optional Redemption of Bonds.........................................................15 Section 902. In Connection with Defeasance of the Bonds ...................................................................15 Section 903. In Connection with the Termination of this Agreement in the Event of Damage or Destruction or Condemnation ...............................................................16 Section 904. In Connection with a Partial Redemption .........................................................................16 Section 905. In Connection with a Determination of Taxability ...........................................................16 ARTICLE X DAMAGE AND CONDEMNATION..............................................................................16 Section 1001. Damage and Destruction...................................................................................................16 Section 1002. Condemnation...................................................................................................................17 ARTICLE XI ADDITIONAL BONDS ...................................................................................................18 Section 1101. Additional Bonds ..............................................................................................................18 Section 1102. Approval of State Agencies ..............................................................................................18 ARTICLE XII AUTOMATIC TERMINATION OF AGREEMENT ......................................................19 ARTICLE XIII EVENTS OF DEFAULT..................................................................................................19 Section 1301. Events of Default ..............................................................................................................19 Section 1302. Remedies of the Trustee for Certain Events of Default ....................................................19 Section 1303. Remedies of the Corporation and the City on Default ......................................................20 Section 1304. Southwest to Remain Liable for Payments; Reletting ......................................................20 Section 1305. No Remedy Exclusive.......................................................................................................20 Section 1306. No Additional Waiver Implied By One Waiver; Consents to Waiver ..............................20 Section 1307. Suspension .......................................................................................................................21 Section 1308. Delay not a Waiver ...........................................................................................................21 ARTICLE XIV DEFAULT BY THE CORPORATION OR THE CITY ..................................................21 Section 1401. Default by the Corporation; Remedies of Southwest........................................................21 Section 1402. Default by the City; Remedies of Southwest ....................................................................21

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ARTICLE XV DISPUTE RESOLUTION................................................................................................22 ARTICLE XVI ASSIGNMENT.................................................................................................................22 Section 1601. Successors and Assignments.............................................................................................22 Section 1602. Opinion of Bond Counsel Required..................................................................................22 ARTICLE XVII GENERAL PROVISIONS ...............................................................................................22 Section 1701. Non-Interference with Operation of Airport .....................................................................22 Section 1702. Attorney's Fees..................................................................................................................23 Section 1703. License Fees and Permits..................................................................................................23 Section 1704. Amendments to this Agreement........................................................................................23 Section 1705. Force Majeure ...................................................................................................................23 Section 1706. References to Bonds, the Corporation, the Trustee and the Indenture Ineffective when Bonds are no Longer Outstanding .................................................................................23 Section 1707. Modifications Hereof and of Indenture.............................................................................23 Section 1708. Paragraph Headings ..........................................................................................................23 Section 1709. Governing Law .................................................................................................................23 Section 1710. Notices ..............................................................................................................................24 Section 1711. Party’s Consent .................................................................................................................24 Section 1712. Correction of Technical Errors .........................................................................................24 Section 1713. Priority of Agreements......................................................................................................24 Section 1714. Legal Construction............................................................................................................24 Section 1715. Entire Agreement..............................................................................................................24 Section 1716. Counterparts......................................................................................................................24 Execution Page ..........................................................................................................................................25 Exhibit A - Project Description Exhibit B – Description of the Project Exhibit C – Disbursement Certificate Exhibit D – PFC Disbursement C ertificate

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SPECIAL FACILITIES AGREEMENT

THIS SPECIAL FACILITIES AGREEMENT (hereinafter called this "Agreement") made and entered into as of __________, 2010, by and among the Love Field Airport Modernization Corporation (the "Corporation"), a local government corporation created to act on behalf of the City of Dallas, Texas, a home-rule city and a political subdivision of the State of Texas (the "City"), pursuant to the Constitution and laws of the State of Texas, including particularly Subchapter D of Chapter 431, Texas Transportation Code, as amended (hereinafter called the "Act"), the City, and Southwest Airlines Co., a Texas corporation authorized to do business in the State of Texas (hereinafter called "Southwest").

WITNESSETH:

WHEREAS, the City is the owner of Dallas Love Field (hereinafter defined and referred to as the “Airport”), which is located in the City of Dallas, Dallas County, Texas; and

WHEREAS, on July 11, 2006, the City, the City of Fort Worth, The Dallas-Fort Worth International Airport Board, Southwest and American Airlines, Inc. entered into that certain “Contract Among The City of Dallas, The City of Fort Worth, Southwest Airlines Co., American Airlines, Inc., and DFW International Airport Board incorporating the Substance of the Terms of the June 15, 2006, Joint Statement Between the Parties to Resolve the ‘Wright Amendment’ Issues” (the “Five Party Agreement”) affecting Dallas Love Field wherein, among other things, the parties thereto agreed to seek to eliminate restrictions on air service at the Airport set forth in existing federal legislation (commonly referred to as the “Wright Amendment”); and

WHEREAS, on October 13, 2006, Public Law 109-352, commonly known as the “Wright Amendment Reform Act of 2006” was signed into law; and

WHEREAS, the Wright Amendment Reform Act of 2006 provides that the interstate flight restrictions imposed on the Airport since 1979 will be lifted on October 13, 2014, in accordance with other terms and conditions set forth in the Wright Amendment Reform Act of 2006; and

WHEREAS, in the Five Party Agreement, the City and Southwest agreed to the significant redevelopment of portions of the Airport, including the modernization of the existing terminal facilities at the Airport, a program referred to as the “Love Field Modernization Program” or “LFMP”, and the City and Southwest agreed to work toward completion of the LFMP by October 2014, eight (8) years from the enactment of the Wright Amendment Reform Act of 2006; and

WHEREAS, following enactments of the Wright Amendment Reform Act of 2006, the City retained consultants to perform a terminal area master plan, a plan referred to as the “Terminal Area Redevelopment Program Study” or “TARPS”, establishing the requirements and criteria for terminal expansion and modernization and, in a parallel effort, Southwest retained consultants to explore alternative conceptual layouts for terminal redevelopment, including the alternative conceptual layout that has been identified by City and Southwest as “Option C”; and

WHEREAS, on June 25, 2008, by Resolution No. 08-1877, the Dallas City Council approved a “Term Sheet” negotiated by the City and Southwest in which the consultant recommendations were adopted, establishing the consensus recommendation that Option C is the preferred concept for the LFMP and will satisfy the requirements defined in the TARPS; and

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WHEREAS, to facilitate the development of the LFMP, the City created the Corporation to act on behalf of

the City in the performance of its governmental functions to promote the development of the geographic area of the City included at or in the vicinity of the Airport, in furtherance of the promotion, development, encouragement, and maintenance of employment, commerce, aviation activity, tourism and economic development in the City; and

WHEREAS, in furtherance of the development of the LFMP, the City, the Corporation and Southwest entered into that certain Program Development Agreement, dated January 15, 2009, as supplemented by Steering Committee Resolution No. 2009-1 and No. 2009-2 (the “Program Development Agreement”); and

WHEREAS, in furtherance of the provisions of the Five Party Agreement, the City and Southwest entered into that certain Amended and Restated Lease of Terminal Building Premises, effectivef October 1, 2008 (the “Airport Use and Lease Agreement”); and

WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the City and Southwest are undertaking the LFMP, a major capital program to improve and modernize terminal facilities at Love Field; and

WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the Corporation, at the request of Southwest, shall issue bonds (the “Bonds”) to finance elements of the LFMP; and

WHEREAS, the parties desire to enter into this Agreement in order to facilitate the construction of elements of the LFMP, as more fully described in Exhibit B attached hereto, through the issuance of Bonds, in one or more series, and to provide for the repayment of the debt service on the Bonds by Southwest, in the manner provided in this Agreement; and

WHEREAS, the Program Development Agreement provides that the City and Southwest contemplate

entering into a revenue credit agreement (the “Revenue Credit Agreement”) to provide for the crediting back to Southwest of payments made by Southwest in support of implementing the LFMP; and

WHEREAS, all capitalized terms used in the Financing Documents which are not otherwise defined herein

shall have the meanings assigned to such terms in the Master Glossary of Terms for Financing Documents Relating to the Love Field Airport Modernization Corporation Special Facilities Revenue Bonds (Southwest Airlines Co. – Love Field Modernization Project), dated as of _________, 2010 (the “Master Glossary”), which is attached hereto as Exhibit A. NOW, THEREFORE, in consideration of the mutual covenants and considerations herein contained, the Corporation, the City and Southwest hereby agree and covenant as follows: ARTICLE I DEFINITIONS As stated in the recitals to this Agreement, capitalized terms defined in the recitals hereto or elsewhere in this Agreement have the meanings set forth therein and, except as otherwise expressly provided or unless the context otherwise requires, additional capitalized terms have the meanings assigned to such terms in the Master Glossary which is attached hereto as Exhibit A and by reference incorporated herein.

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ARTICLE II CONSTRUCTION OF THE PROJECT; REPRESENTATIONS AND WARRANTIES Section 201. Construction of the Project. (a) Construction. As further provided in the Program Development Agreement, the LFMP has been segregated into Southwest Projects, the AFSP, the City Projects and the Other Projects. In accordance with the terms of the Program Development Agreement, the Corporation has assigned to Southwest the responsibility for the construction of the Project. The City shall be responsible for the City Projects. The Project consists of the LFMP Elements described in Exhibit B hereto. Exhibit B may be amended from time to time, as such amendments are approved by the Steering Committee. The terms and provisions of the Program Development Agreement regarding the design and construction of the Project as a part of the Airport shall govern and control, and are incorporated by reference into this Agreement. (b) Standards of Construction. The Project shall be designed and constructed in accordance with the terms of the Program Development Agreement, including specifically, but not by way of limitation, Article V thereof. Section 202. Representations and Warranties by the Corporation. The Corporation makes the following representations and warranties as the basis for the undertakings on its part herein contained: (a) The Corporation is duly organized as a local government corporation, existing and in good standing under the laws of the State, including specifically the Act, and has the power under the Act to enter into the transactions contemplated by this Agreement, the Bond Purchase Agreement and the Indenture and to carry out its obligations hereunder and thereunder. By written resolution, the City has duly approved the execution and delivery of the Indenture, the Bond Purchase Agreement and this Agreement by the Corporation. (b) The Corporation has taken all action and has complied with all provisions of law with respect to the execution, delivery and performance of this Agreement, the Bond Purchase Agreement and the Indenture and the due authorization of the consummation of the transactions contemplated hereby and thereby, and this Agreement, the Bond Purchase Agreement and the Indenture have been duly executed and delivered by, and constitute the valid and legally binding agreements of, the Corporation, enforceable against the Corporation in accordance with their respective terms. (c) Neither the execution and delivery of this Agreement, the Bond Purchase Agreement and the Indenture, the consummation of the transactions contemplated hereby and thereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement, the Bond Purchase Agreement and the Indenture, violate any law or regulation, or any Articles of Incorporation or Bylaws, or any judicial order, judgment, decree, or injunction, conflict with or results in a breach of any of the terms, conditions or provisions of any resolution, ordinance or any agreement or instrument to which the Corporation is now a party or by which it is bound, or constitute a default under any of the foregoing, or result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the Corporation under the terms of any instrument or agreement. (d) There is no litigation now pending or, to the Corporation's knowledge, threatened challenging the powers of the Corporation or its Board of Directors or in any way affecting this Agreement, the Bond Purchase Agreement, the Indenture or the Bonds. (e) The Corporation has determined, in the public interest, that it will finance the Cost of the Project, and deposit the proceeds from the sale of the Bonds into the Construction Fund for use by Southwest for such purposes and in the manner provided in the Act, this Agreement and the Program Development Agreement. (f) No Event of Default of the Corporation has occurred under the terms of the Program Development Agreement and the Corporation is in full compliance with all the terms, conditions, and requirements thereof.

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Section 203. Representations and Warranties by the City. The City makes the following representations and warranties as the basis for the undertakings on its part herein contained:

(a) The City is a duly existing home-rule municipality under the laws of the State, and has the power to enter into the transactions contemplated by this Agreement and to carry out its obligations hereunder. (b) The City is the owner of the Airport.

(c) The City has taken all action and has complied with all provisions of law with respect to the execution, delivery and performance of this Agreement and the Revenue Credit Agreement, and the due authorization of the consummation of the transactions contemplated hereby, and this Agreement and the Revenue Credit Agreement has been duly executed and delivered by, and constitutes the valid and legally binding agreement of, the City, enforceable against the City in accordance with its terms. (d) Neither the execution and delivery of this Agreement and the Revenue Credit Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement and the Revenue Credit Agreement, violate any law or regulation, or any judicial order, judgment, decree, or injunction, conflict with or results in a breach of any of the terms, conditions or provisions of any resolution, ordinance or any agreement or instrument to which the City is now a party or by which it is bound, or constitute a default under any of the foregoing, or result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the City under the terms of any instrument or agreement. (e) There is no litigation now pending or, to the City's knowledge, threatened challenging the powers of the City or its City Council or in any way affecting this Agreement and the Revenue Credit Agreement. (f) No Event of Default of the City has occurred under the terms of the Program Development Agreement and the City is in full compliance with all the terms, conditions, and requirements thereof. Section 204. Representations and Warranties by Southwest. Southwest makes the following representations and warranties as the basis for the undertakings on its part herein contained: (a) Southwest is a corporation duly organized under the laws of the State of Texas and duly qualified to do business in the State, is in good standing in the State, has power to execute and enter into this Agreement and by proper corporate action has been duly authorized to execute and deliver this Agreement. (b) Southwest will execute the Tax Representation Certificate, dated the Closing Date, setting forth certain covenants, representations and warranties, which upon execution the Tax Representation Certificate will be incorporated herein and included as a part of this Agreement by reference. Southwest represents that the representations set forth in the Tax Representation Certificate will be accurate as of such date and covenants to comply with the covenants set forth in the Tax Representation Certificate. (c) Southwest hereby makes an irrevocable election not to claim depreciation or an investment tax credit with respect to the Project in accordance with Section 142(b)(1)(B)(i) of the Code, such that the Bonds shall qualify under Section 142(a)(1) of the Code. The tax identification number of Southwest is 74-1563240. (d) This Agreement, the Guaranty, the Revenue Credit Agreement and the Bond Purchase Agreement have been duly executed and delivered by duly authorized officers of Southwest, and constitute valid and binding obligations of Southwest, enforceable against Southwest in accordance with their respective terms. (e) No approvals or consents, other than those that have been or will in normal course be obtained, are necessary in order for Southwest to execute and deliver this Agreement, the Guaranty, the Revenue Credit Agreement, the Bond Purchase Agreement or the Tax Representation Certificate.

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(f) There is no litigation now pending or, to Southwest's knowledge, threatened, challenging the corporate existence of Southwest and, except for matters described under "Legal Proceedings" in Southwest's Annual Report on Form 10-K for Southwest's fiscal year ended December, 2009, there is no pending, or to Southwest's knowledge, threatened action or proceeding before any court or administrative agency that individually (or in the aggregate in the case of any group of related lawsuits) is expected to have a material adverse effect on the financial condition of Southwest or the ability of Southwest to perform its obligations under this Agreement, the Bond Purchase Agreement, the Revenue Credit Agreement or the Guaranty. (g) Neither the execution and delivery of this Agreementor the Tax Representation Certificate, the consummation of the transactions contemplated hereby, nor the fulfillment of or compliance with the terms and conditions of this Agreement or the Tax Representation Certificate, will conflict with or result in a material breach of the Articles of Incorporation or By-laws of Southwest or any of the terms, conditions or provisions of any indenture, agreement or other instrument to which Southwest is now a party or by which it is bound, or constitute a material default under any of the foregoing, or result in the creation or imposition of any material lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of Southwest under the terms of any instrument or agreement. (h) Southwest has duly and validly obtained all material certificates, licenses and permits from all public authorities, both federal and state, required to enable Southwest to carry on its business as it is now conducted and to enter into this Agreement. (i) To the best of its knowledge, no event has occurred and no condition currently exists, which constitutes or may, with the passage of time or the giving of notice, or both, constitute an Event of Default with respect to or on the part of Southwest under this Agreement or the Guaranty or that could materially adversely affect the ability of Southwest to perform its obligations hereunder or thereunder. (j) To the best of its knowledge, no Event of Default of Southwest has occurred under the terms of the Program Development Agreement and Southwest is in full compliance with all the terms, conditions, and requirements thereof. ARTICLE III COMMENCEMENT AND COMPLETION OF PROJECT; ISSUANCE OF BONDS Section 301. Construction of the Project. The construction of the Project shall commence and proceed in accordance with the conditions set forth in the Program Development Agreement. Section 302. Agreement to Issue Bonds; Application of Proceeds; Southwest Required to Pay Costs of Construction if Bond Proceeds Insufficient. (a) Pursuant to the terms of the Indenture, the Corporation shall issue the Bonds upon the execution and delivery of this Agreement to provide funds for paying the Costs of the Project, net of Costs paid from grants or other revenues received by the City and made available to pay Costs of the Project. (b) The Bonds shall be issued under and in accordance with the Indenture, the form of which shall have been approved by the City and Southwest prior to the adoption thereof.

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(c) The proceeds of the Bonds shall be deposited directly by the Corporation with the Trustee in the funds and accounts specified in the Indenture. Proceeds of the Bonds deposited in the Construction Fund shall be disbursed by the Trustee for the payment of Costs of the Project. (d) In the event that funds held in the Construction Fund available for payment of the Costs of the Project are insufficient: (i) Southwest shall provide funds to complete the construction of the Project; (ii) with the prior written approval of the City, Southwest shall appropriately reduce the scope of the Project so that funds in the Construction Fund will be sufficient (if such reduction in scope, in the opinion of Bond Counsel, will not adversely affect the exclusion from gross income of the interest on the Bonds for federal income tax purposes); (iii) additional sources of funds shall be made available to complete the construction of the Project, consistent with the terms of the Program Development Agreement; or (iv) Southwest shall request that the Corporation issue additional bonds ("Additional Bonds") pursuant to Article XI hereof to the extent necessary to provide sufficient funds for such purposes, provided that, in the opinion of Bond Counsel, the issuance of such Additional Bonds will not adversely affect the exclusion from gross income of the interest on the Bonds for federal income tax purposes. (e) Neither the City nor the Corporation makes any warranty, either express or implied, that the Project can or will be constructed for the estimated cost therefor, or that the moneys paid into the Construction Fund and available for payment of the Costs of the Project shall be sufficient for that purpose. Southwest agrees that if, after exhaustion of such funds, Southwest pays any portion of the Costs of the Project for any reason whatsoever, it shall not be entitled to any reimbursement therefor from either the Corporation or the City (except reimbursement from the proceeds of Additional Bonds, if any) nor shall Southwest be entitled to any set-off or diminution of the rentals due under the Airport Use and Lease Agreement or other amounts payable under this Agreement, unless otherwise agreed to by the Corporation and the City. Section 303. Construction Fund. (a) The proceeds of the Bonds shall be deposited into the Debt Service Fund and the Construction Fund as provided in Article III(A) of the Indenture. Sums on deposit in the Construction Fund (except in the Net Proceeds Account) shall be invested at the direction of Southwest as set forth in the Indenture. Sums on deposit in the Net Proceeds Account shall be invested at the direction of the City as set forth in the Indenture. The Trustee shall disburse or apply the money in the Construction Fund in accordance with this Section and Article III of the Indenture. (b) Pursuant to the Indenture, the Trustee shall disburse (or transfer to the Debt Service Fund) amounts in the Project Construction Account within the Construction Fund to pay Costs of the Project, including the Southwest Reimbursable Costs, plus interest thereon at the Revenue Bond Index Rate, upon receipt of a Disbursement Request. Each such Disbursement Request shall have attached for each item for which payment is sought, to the extent applicable, evidence of payment (e.g., paid invoices or canceled checks) or evidence that payment is due to a party other than Southwest, in each case reasonably satisfactory to the Aviation Director and the Trustee. Upon receipt of a Disbursement Request, the Aviation Director shall have three Business Days either to approve and execute the Disbursement Request or provide written objections to all or any of the items for which Southwest seeks disbursement from the Project Construction Account within the Construction Fund. An amended Disbursement Request, which includes only the items to which the Aviation Director did not raise a written objection, may be submitted by Southwest and shall be promptly signed by the Aviation Director. If Southwest and the Aviation Director are unable to agree that an item for which disbursement of moneys from the Construction Fund shall be paid from moneys in the Project Construction Account within the Construction Fund shall be paid, the dispute shall be resolved in the manner provided in Article XV hereof. In making any such payment from the Project Construction Account within the Construction Fund, the Trustee may rely on such Disbursement Requests and proof delivered to it, and the Trustee shall be relieved of all liability with respect to making such payments in accordance with the foregoing.

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(c) Upon the filing of the completion certificate pursuant to Section 304(b) hereof, the balance in the Project Construction Account within the Construction Fund in excess of the amount, if any, stated in such certificate to be retained therein, shall be held and applied as directed by the Authorized Southwest Representative in accordance with Article III(F) of the Indenture. (d) In the event Southwest shall be required or shall elect to prepay all of the Facilities Payments hereunder, Southwest may direct the Trustee to transfer the balance in the Project Construction Account within the Construction Fund to the Debt Service Fund without the necessity of complying with subsection (b) of this Section. (e) In case of acceleration of maturity of the Bonds pursuant to the Indenture, the Trustee shall transfer the balance in the Project Construction Account within the Construction Fund to the Debt Service Fund without the necessity of complying with subsection (b) of this Section. (f) Pursuant to the Indenture, the Trustee shall disburse amounts in the PFC Account within the Construction Fund to pay Costs of the Project eligible to be paid from PFCs upon receipt of a PFC Disbursement Request.

Each such PFC Disbursement Request shall have attached for each item for which payment is sought, to the extent applicable, evidence of payment (e.g., paid invoices or canceled checks) or evidence that payment is due to a party other than Southwest, in each case reasonably satisfactory to the Aviation Director and the Trustee. Upon receipt of a PFC Disbursement Request, the Aviation Director shall have three Business Days either to approve and execute the PFC Disbursement Request or provide written objections to all or any of the items for which Southwest seeks disbursement from the PFC Account within the Construction Fund. An amended PFC Disbursement Request, which includes only the items to which the Aviation Director did not raise a written objection, may be submitted by Southwest and shall be promptly signed by the Aviation Director. If Southwest and the Aviation Director are unable to agree that an idea for which disbursement of moneys from the PFC Account within the Construction Fund shall be paid, the dispute shall be resolved in the manner provided in Article XV hereof.

In making any such payment from the PFC Account within the Construction Fund, the Trustee may rely on

such PFC Reimbursement Request and proof delivered to it, and the Trustee shall be relieved of all liability with respect to making such payments in accordance with the foregoing. Section 304. Establishment of the Completion Date, Other Completion Certificates. (a) The Completion Date of the Project shall be evidenced to the Corporation, the City and the Trustee by a certificate signed by Southwest to the effect: (i) that the design and construction of the Project has been completed and (ii) that Southwest has made a reasonable investigation of such sources of information it deems necessary and is of the opinion that the Project has been fully paid for and that no claim or claims exist against the Corporation, the City or Southwest or against the properties of any of the Corporation, the City or Southwest, out of which a lien based on furnishing labor or material for the Project might ripen. Such certificate shall be delivered within one hundred twenty (120) days of the first day on which the conditions set forth in both (i) and (ii) above have been satisfied. (b) Within two hundred forty (240) days of the date on which the Project has been finally completed and all amounts due and owing with respect thereto have been paid, Southwest shall certify to the Corporation, the Trustee and the City the final amounts paid by Southwest with respect thereto. Section 305. Southwest to Pursue Remedies Against Contractors, Subcontractors and Suppliers and Their Sureties. (a) In the event of default or breach by any contractor, subcontractor, manufacturer or supplier under any contract made in connection with the design and construction of the Project, Southwest may, in its discretion, either separately or in conjunction with the Corporation or the City, pursue the remedies of the Corporation, the City and/or Southwest against the contractor, subcontractor, manufacturer or supplier so in default and against any surety

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for the performance of that contractor, subcontractor, manufacturer or supplier, or against a contractor, subcontractor, manufacturer or supplier for breach of warranty, in the manner provided in the Program Development Agreement. (b) Any amount recovered by way of damages, refunds, adjustment or otherwise in connection with the foregoing shall be disbursed in accordance with the provisions of the Program Development Agreement. Section 306. Ownership of Improvements. As provided in the Program Development Agreement and pursuant to the terms of the Agreement for Donation, Southwest will donate and the City will accept all Purchased Items as acquired from third parties under the Project Contracts. ARTICLE IV TERM The term of this Agreement shall commence on the date of the execution hereof and shall terminate upon the expiration or earlier termination of the Revenue Credit Agreement, unless this Agreement is terminated earlier in accordance with Article XIII hereof; provided, however, that the provisions of Sections 604, 801 and 802 shall survive such termination as provided in such sections. ARTICLE V FACILITIES PAYMENTS Section 501. Facilities Payments. So long as any Bond is Outstanding, Southwest shall pay or cause to be paid to the Corporation, by depositing or causing to be deposited with the Trustee, payments (the "Facilities Payments"), payable without demand, either: (i) in same day funds pursuant to an automated clearinghouse transfer, one (1) Business Day prior to the date on which principal of, or premium, if any, and interest is due on the Bonds, or (ii) in same day funds prior to 10:00 a.m. on the date on which principal of, or premium, if any, and interest is due on the Bonds, in either case in an amount equal to such principal of, interest or premium payments due on the Bonds whether at maturity, upon redemption, by acceleration or otherwise; provided that in the case of each payment the amount thereof shall be reduced by an amount equal to any amount then held by the Trustee in the Debt Service Fund which is available for such payment. Southwest hereby acknowledges that the Facilities Payments made or caused to be made by Southwest to the Trustee and any amounts held by the Trustee in the Debt Service Fund which are available for such payment are the sole sources of moneys to be used by the Corporation to make payments of the principal of, interest or premium, if any, due on the Bonds. Section 502. Place of Payments. The Facilities Payments payable pursuant to Section 501 hereof shall be payable to the Corporation at the Designated Trust Office of the Trustee for deposit in the Debt Service Fund. Section 503. Assignment of Rights. As security for the payment of the Bonds, the Corporation agrees and, pursuant to the terms of the Indenture, does assign its right, title and interest in and to the Facilities Payments to the Trustee as part of the Trust Estate. Southwest hereby assents to the assignment of such rights hereunder. The Trustee shall not be responsible for those rights and obligations of the Corporation not assigned by the Corporation to the Trustee as part of the Trust Estate. Section 504. Obligations of Southwest Hereunder Unconditional. The obligation of Southwest to make the payments required under Section 501 hereof and to pay the premiums or charges necessary to maintain or cause to be maintained the insurance required by Article IX shall be absolute and unconditional and shall not be subject to

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any defense (other than payment) or any right of set-off, counterclaim, abatement or otherwise. Southwest shall not suspend, postpone, discontinue or permit the suspension, postponement or discontinuance of any such payments referred to in Section 501. Each payment referred to in Section 501 made by Southwest pursuant to this Agreement shall be final and Southwest shall not seek to recover all or any part of such payment from the Trustee or any holder of the Bonds for any reason whatsoever. Nothing contained in this Section 504 shall be construed to relieve the Corporation or the Trustee from the performance of any of the agreements on their part contained herein or in the Indenture or to constitute a waiver by Southwest of its rights to enforce the performance thereof or to recover from the Corporation damages for the Corporation's failure to perform its covenants hereunder. Section 505. Payments to Corporation. Southwest hereby agrees to pay or cause to be paid directly to the Corporation while any of the Bonds is outstanding, upon receiving a bill or statement therefor, an amount sufficient to pay and reimburse the Corporation for any of its actual costs reasonably and necessarily incurred in connection with the Bonds or this Agreement as reflected in such bill or statement. ARTICLE VI OBLIGATIONS OF SOUTHWEST Section 601. Right to Use Airport. The granting of this Agreement and its acceptance by Southwest is conditioned upon the right to use the Airport in common with others authorized to do so, consistent with the terms of the Airport Use and Lease Agreement. Section 602. Mechanic's Liens. (a) Southwest herein agrees that if any mechanic's lien is filed upon any portion of the Project, Southwest shall protect and save harmless the Corporation and the City against any loss, liability or expense whatsoever by reason thereof and shall proceed with or defend, at its own expense, such action or proceedings as may be necessary to remove such lien from the records to the extent that the Airport or any portion thereof is affected. Upon receipt of notice thereof by the Corporation or the City, the Corporation or the City shall promptly give Southwest written notice of the existence of any such mechanic's lien on all or any portion of the Project, but the failure of the Corporation or the City to give such notice shall not affect the responsibilities of Southwest as set forth in this Section 602. (b) Southwest may, however, in good faith and with due diligence, contest any mechanic's lien or other lien filed or established against all or any portion of the Project, and in such event may permit such lien or charge to remain undischarged and unsatisfied during the period of such contest and appeal therefrom, if (i) Southwest shall effectively prevent or stay the execution, foreclosure or enforcement of such lien or charge, or (ii) such contest or appeal shall prevent or stay the execution or enforcement or foreclosure of such lien or charge. If such lien or charge is so stayed and such stay thereafter expires or the Corporation or the City gives Southwest written notice of the fact that by nonpayment of any such items the Airport or any portion thereof will be subject to loss or forfeiture, then Southwest shall forthwith pay and cause to be satisfied and discharged such lien or charge or secure such payment by posting a bond, in form satisfactory to the Corporation and the City. The Corporation and the City shall cooperate fully with Southwest in any such contest. (c) If Southwest shall fail to contest, discharge or pay any such lien as required by Subsections (a) and (b) hereof, the Corporation or the City may, after having given Southwest at least sixty (60) days' written notice of such failure, contest, discharge or pay any such lien which the Corporation or the City may reasonably determine to be necessary in order to protect its interest in the Airport. In such event, Southwest agrees to reimburse the Corporation and the City for any and all reasonable expenses and costs incurred by the City in respect thereto. Section 603. Southwest to Maintain its Corporate Existence; Conditions Under Which Exceptions Permitted. Except as hereinafter provided, Southwest agrees that during the term of this Agreement it will not dissolve or otherwise dispose of all or substantially all of its assets and will not consolidate with or merge into

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another Person unless the surviving or transferee Person, as applicable, is, and after such transfer shall be, a solvent Person qualified to do business in the State and, concurrently with such transaction, irrevocably and unconditionally assumes in writing, by means of an instrument which is delivered to the Corporation, the City and the Trustee, all of the obligations of Southwest herein. Section 604. Tax Exemption. (a) The Corporation (to the extent that such matters are within its control), the City (to the extent that such matters are within its control) and Southwest covenant to refrain from any action which would adversely affect, and to take such action (including the provision and enforcement by Southwest in any document of sublease or assignment of Southwest's interest in the Project of appropriate covenants of the sublessee or assignee thereunder) as is necessary to assure, the treatment of the Bonds as obligations described in section 103(a) of the Code, the interest on which is not includable in the "gross income" of the owner thereof for purposes of federal income taxation (other than the gross income of a "substantial user" of the Project or a "related person" to such a "substantial user", within the meaning of the Code). In particular, but not by way of limitation thereof, the Corporation (to the extent that such matters are within its control), the City (to the extent that such matters are within its control) and Southwest covenant as follows:

(i) to take such action which may be reasonably available to the Corporation, the City or Southwest to assure that the bonds are "exempt facility bonds", as defined in section 142(a) of the Code, at least 95 percent of the proceeds of which are used to provide airport facilities (within the meaning of section 142(a) of the Code);

(ii) to ensure at all times during the term of the Bonds that the property financed, constructed and improved with the proceeds thereof be treated as governmentally owned within the meaning of section 142(b) of the Code; (iii) to ensure that at all times while the Bonds are Outstanding Southwest will not claim for federal income tax purposes any depreciation deductions or investment tax credits in respect to the property finance with the proceeds of the Bonds;

(iv) 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;

(v) 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 --

(1) proceeds of the Bonds invested for a reasonable temporary period (not to exceed three years) or, until such proceeds are needed for the purpose for which the Bonds are issued, and

(2) proceeds of amounts invested in a bona fide debt service fund, within the meaning of section 1.148-1(b) of the Regulations;

(vi) to otherwise restrict the investment of the proceeds of the Bonds or amounts treated as proceeds of the Bonds, as may be necessary, to satisfy the requirements of section 148 of the Code (relating to arbitrage);

(vii) to use no more than two percent of the proceeds of the Bonds for the payment of costs of issuance (including underwriters' discount) of the Bonds; (viii) to ensure that the proceeds of the Bonds will be used solely for new money projects;

(ix) to use no portion of the proceeds of the Bonds to provide any airplane, sky-box or other private luxury box, facility primarily used for gambling or store the principal business of which is the sale

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of alcoholic beverages for consumption off-premises;

(x) to comply with the limitations imposed by section 147(c) of the Code (relating to the limitation of the use of proceeds to acquire land) and section 147(d) of the Code (relating to restrictions on the use of bonds proceeds to acquire existing buildings, structures or other property).

It is the understanding of the Corporation, the City and Southwest that the covenants contained herein are intended to assure compliance with the provisions of the Code, and any regulations or rulings promulgated by the U.S. Department of the Treasury pursuant thereto, pertaining to obligations described in section 103(a) of the Code. In the event that regulations or rulings applicable to the Bonds are hereafter promulgated which modify or expand such provisions of the Code, the Corporation, the City and Southwest will not be required to comply with any covenant contained herein to the extent that, in the opinion of Bond Counsel, such failure to comply will not adversely affect the excludability pursuant to section 103(a) of the Code of interest on the Bonds from the gross income of the owners thereof for federal income tax purposes. In the event that regulations or rulings are hereafter promulgated which impose additional requirements, pertaining to obligations described in section 103(a) of the Code, which are applicable to the Bonds, the Corporation, the City and Southwest agree to comply with the additional requirements to the extent necessary, in the opinion of Bond Counsel, to preserve the excludability pursuant to section 103(a) of the Code of interest on the Bonds from the gross income of the owners thereof for federal income tax purposes. (b) Southwest shall maintain or cause the Trustee to maintain for at least six years following final payment of interest and principal on the Bonds accurate investment records for the purpose of determining the amount of arbitrage rebate that shall be owed with respect to the Bonds to the United States in order to comply with the requirements of Section 148 of the Code with respect to the Bonds. Southwest shall compute and cause to be paid, in the manner and time provided in the Tax Representation Certificate, the arbitrage rebate that is required to be paid to the United States pursuant to Section 148 of the Code in order to preserve the tax status of the interest on the Bonds. In any event, if the amount of cash held in the Special Rebate Fund immediately prior to the date on which any payment must be made by the Trustee pursuant to Article III(G)(2) of the Indenture shall be insufficient to permit the Trustee to make such payment to the United States, Southwest forthwith shall pay the amount of such insufficiency to the Trustee in immediately available funds. The obligations of Southwest under this Section are direct obligations of Southwest, acting under the authorization of, and on behalf of, the Corporation, and neither the City nor the Corporation shall have any further obligation or duty with respect to the Special Rebate Fund. (c) Southwest and the City understand that the provisions of this Section 604 may survive the discharge of the Bonds. Section 605. Southwest's Covenant Concerning the Bonds. (a) Trustee's Fees and Expenses. Southwest shall pay the ordinary fees and expenses of the Trustee for serving as the Trustee under the Indenture and the Guaranty and shall also pay to the Trustee all extraordinary fees and expenses incurred by the Trustee in enforcing the provisions of this Agreement, the Indenture or the Guaranty or otherwise serving in the capacity as the Trustee under the Indenture and the Guaranty. (b) Investment of Funds Under the Indenture. Any moneys held in the Funds or Accounts established under the Indenture shall be invested or reinvested by the Trustee in Qualified Investments in accordance with the provisions of the Indenture. (c) Advances by the Corporation and Trustee. In the event Southwest shall fail to comply with any covenant or agreement set forth in this Agreement, the Corporation, the City or the Trustee may (but shall be under no obligation to) comply with said covenants and agreements. All amounts advanced by the Corporation, the City or the Trustee to comply with such agreements and covenants shall be paid by Southwest to the one making the advancements, together with interest thereon at the Trustee's prime rate of interest. Section 606. Southwest's Obligations Concerning SEC Rule 15c2-12.

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(a) Pursuant to Rule 15c2-12(b)(5) under the Exchange Act, Southwest hereby agrees and undertakes, for the benefit of the holders and beneficial owners of the Bonds, to (1) file, within ninety (90) days after the end of Southwest's 2009 fiscal year and each fiscal

year thereafter, with the Commission annual financial information concerning Southwest for the prior fiscal year including (i) Southwest's audited financial statements, prepared in accordance with generally accepted accounting principles in effect from time to time, (ii) Southwest's periodic reports filed with the Commission under the Exchange Act, and (iii) summary financial information and operating data of the type disclosed in Appendix A to the official statement prepared in connection with the sale of the Bonds;

(2) send, within ninety (90) days after the end of Southwest's 2009 fiscal year and each fiscal

year thereafter, notice to the MSRB that Southwest's annual financial information filed with the Commission in accordance with the Exchange Act constitutes Southwest's annual financial information for the prior fiscal year for purposes of this Section 606; and

(3) provide timely notice to the MSRB of (i) the occurrence of any of the events enumerated in

Rule 15c2-12(b)(5)(i)(C), as amended from time to time, with respect to the Bonds if material, and (ii) any failure of Southwest to provide required annual financial information.

All information shall be filed or provided in the manner prescribed by the MSRB. (b) No holder or beneficial owner of a Bond may institute any suit, action or proceeding at law or in equity for the enforcement of any covenant herein or for any remedy for breach thereof, unless such holder or beneficial owner shall have given Southwest evidence of ownership and written notice of and request to cure such breach, and Southwest shall have failed to comply within reasonable time. No remedy shall be sought or granted other than specific performance of the covenant at issue. Failure to comply with any covenant contained in this Section 606 shall not be an Event of Default under this Agreement. (c) This Section 606 may only be amended in accordance with the Rule and interpretations thereunder. If this Section 606 is amended, the annual financial information containing the amended summary financial information or operating data will explain, in narrative form, the reasons for the amendment and the impact of the change in the type of summary financial information or operating data being provided. (d) The obligation of Southwest under this Section 606 shall be automatically terminated upon the legal defeasance, prior redemption or payment in full of all of the Bonds or at the time nationally recognized counsel determines that Southwest is no longer an "obligated person" under the Rule. If such termination occurs prior to the maturity of the Bonds, Southwest shall give notice in a timely manner to the MSRB. (e) This Section 606 shall inure solely to the benefit of the holders and the beneficial owners of the Bonds and shall create no rights in any other person or entity. ARTICLE VII RESERVATIONS Section 701. Improvement, Relocation or Removal of Facilities at the Airport. Subject to Section 1104 hereof, and in accordance with the provisions of the Airport Use and Lease Agreement, Southwest hereby acknowledges that the City, at its sole discretion, reserves the right to further develop or improve the Aircraft Operating Area (as defined in FAA regulations) and other portions of the Airport, including the right to remove or relocate any structure on the Airport, as it sees fit, and to take any action it considers necessary to protect the aerial approaches of the Airport against obstructions, together with the right to prevent Southwest from erecting or permitting to be erected, any buildings or other structure on the Airport which, according to FAA standards and

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regulations, would limit the usefulness of the Airport, constitute a hazard to aircraft or violate FAA standards or regulations. Section 702. Subordination to U.S. Government. This Agreement shall be subordinate to the provisions of any existing or future agreement(s) between the City and the United States Government, relative to the operation and maintenance of the Airport, the terms and execution of which have been or may be required as a condition precedent to the expenditure or reimbursement to the City of federal funds for the development of the Airport; the foregoing notwithstanding, no such subordination shall adversely impact the obligations of Southwest under Section 501 or the assignment of Facilities Payments by the Corporation under Section 503. Section 703. War or National Emergency. During the time of war or national emergency, the parties recognize that the City shall have the right to lease the Airport or any part thereof to the United States Government for military use, and if any such lease is executed, the provisions of this Agreement insofar as they are inconsistent with the lease to the United States Government shall be suspended. Section 704. Special Obligation of the Corporation. The Bonds shall be special and limited obligations of the Corporation, payable solely and only out of the Trust Estate. No holder of any Bond shall have the right to compel any exercise of the taxing power of the State or any political subdivision thereof, including the City, to pay principal of, premium, if any, or interest on the Bonds, and the Bonds shall not constitute an indebtedness of the State or any political subdivision thereof, including the City, or a loan of credit thereof within the meaning of any constitutional or statutory provision or limitation or indebtedness. Section 705. Responsibility for Contracts for Project and Payment of Facilities Payments. The Corporation shall not be required to pay or provide any monies for the construction, modification, expansion or installation of the Project, except to the extent of the moneys in the Construction Fund. Failure of the contractor or contractors to complete the construction, modification, expansion and installation of the Project shall in no way affect the payment obligations of Southwest under Section 501 of this Agreement. Section 706. Consideration of Amendment. In the event that the FAA, or its successors, requires modifications or changes in this Agreement as a condition precedent to the granting of funds for the improvement of the Airport, Southwest agrees to consider in good faith to such amendments, modifications, revisions, supplements or deletions of any of the terms, conditions or requirements of this Agreement as may be reasonably required to obtain such funds. ARTICLE VIII INDEMNITY AND INSURANCE Section 801. Indemnification of Indemnified Parties. (a) Agreement to Indemnify. Southwest releases the Indemnified Parties from, and the Indemnified Parties shall not be liable for, and Southwest agrees and shall protect, indemnify, defend, and hold the Indemnified Parties harmless from any and all Claims or Losses (including, but not limited to, attorneys' fees, litigation and court costs, amounts paid in settlement, and amounts paid to discharge judgments) directly or indirectly resulting from, arising out of, in connection with, or related to (i) the issuance, offering, sale, or delivery of the Bonds, the Bond Purchase Agreement, the Indenture, the Guaranty, the Revenue Credit Agreement and this Agreement and the obligations imposed on the Corporation or the City hereby and thereby; (ii) any written statements or representations made or given by Southwest or any of its agents, officers or employees, to the Indemnified Parties, or to any underwriters or purchasers of any of the Bonds, with respect to Southwest, the Project, or the Bonds, including, but not limited to, statements or representations of facts, financial information, or corporate affairs; (iii) damage to property or any injury to or death of any person that may be occasioned by any cause whatsoever pertaining to the Project; (iv) the presence or release of any Hazardous Materials or any environmental condition at the Project, subject to the provisions of Article 11 of the Program Development Agreement; and (v) any breach, violation or

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nonperformance of any covenant of Southwest hereunder, including, without limitation, any loss or damage incurred by the Corporation or the City as a result of violation by Southwest of the provisions of Sections 604 or 605. THE FOREGOING NOTWITSTANDING, SUCH INDEMNIFICATION PROVISION SHALL NOT APPLY TO (AND SOUTHWEST SHALL NOT BE REQUIRED TO RELEASE, INDEMNIFY, HOLD HARMLESS OR DEFEND THE INDEMNIFIED PARTIES WITH RESPECT TO) ANY SUITS, ACTIONS, CLAIMS OR DAMAGES OF ANY CHARACTER ARISING FROM THE SOLE NEGLIGENCE, FAULT OR WILLFUL MISCONDUCT OF ANY INDEMNIFIED PARTY, AND IN THE EVENT OF JOINT AND CONCURRING NEGLIGENCE OF SOUTHWEST AND ANY INDEMNIFIED PARTY, RESPONSIBILITY AND LIABILITY, IF ANY, SHALL BE APPORTIONED COMPARATIVELY IN ACCORDANCE WITH THE LAWS OF THE STATE WITHOUT WAIVING ANY DEFENSES OF THE PARTIES UNDER STATE LAW. (b) Defense. Southwest shall have the right to assume the investigation and defense of all Claims, including the employment of counsel and the payment of all expenses. Each Indemnified Party shall have the right to employ separate counsel in any such action and participate in the investigation and defense thereof, but the fees and expenses of such counsel shall be paid by such Indemnified Party unless (i) the employment of such counsel has been specifically authorized by Southwest, in writing, or (ii) Southwest has failed to assume the defense and to employ counsel and the ability of the Indemnified Parties to be adequately defended is thereby jeopardized, or (iii) the named parties to any such action include both an Indemnified Party and Southwest, and the Indemnified Party shall have received a written legal opinion of counsel to the effect that in such counsel's opinion, one or more of the legal defenses available to such Indemnified Party are in conflict with those available to Southwest (in which case, if such Indemnified Party notifies Southwest in writing that it elects to employ separate counsel at Southwest's expense, Southwest shall not have the right to assume the defense of the action on behalf of such Indemnified Party; provided however, that Southwest shall not, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegation or circumstances, be liable for the reasonable fees and expenses of more than one separate firm of attorneys for the Indemnified Parties, which firm shall be designated in writing by the Indemnified Parties); provided further, anything to the contrary notwithstanding, nothing herein shall be construed as prohibiting the City and the Corporation from utilizing the City Attorney of the City as its counsel, and having the expenses and overhead associated therewith paid by Southwest. (c) Cooperation with Southwest. Each Indemnified Party shall use reasonable efforts to cooperate with Southwest in the defense of any Claim. Southwest shall not be liable for any settlement of any such action without its consent, unless the interests of the Indemnified Parties are in conflict with the interests of Southwest, but, if any such action is settled with the consent of Southwest, Southwest shall indemnify and hold harmless the Indemnified Parties against any Loss by reason of such settlement as provided in this Section. (d) Survival of Term. The provisions of this Section 801 shall survive the term of this Agreement for all Claims arising out of actions or occurrences during the term of this Agreement. Section 802. Indemnification of the Trustee. (a) Agreement to Indemnify. Southwest agrees to indemnify the Trustee, its directors, officers and employees, for and to hold it harmless against, any loss, liability or expense incurred without negligence, whether by act or omission to act, or willful misconduct on its part, arising out of or in connection with the performance of its duties under the trust imposed by the Indenture, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties under the Indenture, provided, however, that: (1) the Trustee shall reimburse Southwest for payments made by Southwest pursuant to such

indemnity, to the extent of any proceeds, net of all expenses of collection, actually received by it from any insurance proceeds with respect to any such indemnified loss, liability or expense, and the Trustee shall assign rights to such proceeds, to the extent of such required reimbursement, to Southwest;

(2) as a condition to such indemnity, the Trustee shall promptly notify Southwest in writing of any

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claim brought against the Trustee in respect of which indemnity may be sought against Southwest; provided, that the failure to notify Southwest shall not relieve Southwest from any liability that it may have under this Section 802, except to the extent that Southwest has been prejudiced (through the forfeiture of substantive rights or defenses) by such failure;

(3) Southwest shall have the right to assume the investigation and defense of any claims against the

Trustee in respect of which indemnity may be sought against Southwest, including the employment of counsel and the payment of all expenses, provided that the Trustee shall have the right to employ separate counsel in any such action and participate in the investigation and defense thereof, but the fees and expenses of such counsel shall be paid by the Trustee unless (a) the employment of such counsel has been specifically authorized by Southwest, in writing, or (b) Southwest has failed to assume the defense and to employ counsel, or (c) the Trustee determines in good faith that its rights cannot be adequately represented by counsel employed by Southwest as a result of a conflict between the interests of Southwest and the interests of the Trustee;

(4) the Trustee, as a condition of such indemnity, shall use reasonable efforts to cooperate with

Southwest in the defense of any claim in respect of which indemnity may be sought against Southwest; and

(5) Southwest shall not be liable for any settlement of any such action without its consent, but, if any

such action is settled with the consent of Southwest or there be final judgment for the plaintiff in any such action, Southwest shall indemnify and hold harmless the Trustee by reason of such settlement or judgment as provided herein.

(6) Southwest shall not, without the written consent of the Trustee, effect any settlement of any

pending or threatened proceeding in respect of the Trustee is or could have been a party and indemnification could have been sought hereunder by the Trustee, unless such settlement (x) includes an unconditional release of the Trustee and (y) does not include any statement as to or any admission of fault, culpability or failure to act by or on behalf of the Trustee.

Neither the City nor the Corporation is obligated to indemnify the Trustee. (b) Survival of Term. The provisions of this Section 802 shall survive the term of this Agreement, the discharge of the Indenture, and the payment in full of the Bonds. Section 803. Insurance. The City and Southwest shall procure, maintain and keep in force, at all times during the term of this Agreement, insurance in accordance with the terms of the Program Development Agreement and the Airport Use and Lease Agreement. Notwithstanding the insurance requirements contained in said agreements, the City shall, at all times during the term of this Agreement, procure, maintain and keep in force fire and extended coverage written to provide the City with one hundred percent (100%) of the insurable value of such property, if such coverage is reasonably available. Additionally, at all times during the term of this Agreement, the City shall procure, maintain and keep in force business interruption insurance on the “Airfield”, “Apron”, “Parking & Ground Transportation Area” and “Terminal” cost centers comprising a portion of the Airport Cost Centers, if such coverage is reasonably available. Section 804. Application of Insurance Proceeds. The proceeds of the insurance required to be maintained in accordance with the provisions of Section 803 hereof shall be paid and disbursed in accordance with the provisions of Article X hereof; provided, however, any business interruption insurance proceeds accruing to the City as a result of a covered claim during the term of the Revenue Credit Agreement with respect to the “Airfield”, “Apron”, “Parking & Ground Transportation Area” and “Terminal” cost centers comprising a portion of the Airport Cost Centers shall be retained by the City and considered to be Airport System gross revenues to be applied to the rates and charges model then in existence. Section 805. Right of the City or Trustee to Pay Insurance Premiums. In the event that Southwest shall fail

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to maintain full insurance coverage required by this Agreement, the City, acting on behalf of the Corporation, or the Trustee may (but shall be under no obligation to) take out the required policies of insurance, pay the required premiums or otherwise comply with the covenants set forth in Section 803 hereof. All amounts advanced by the City, acting on behalf of the Corporation, or the Trustee in payment of the required premiums for such insurance or otherwise to comply with the covenants set forth in such Section shall be paid by Southwest to the one making the advances, together with interest thereon at the Trustee's prime rate of interest.

Section 806. Right of Southwest or Trustee to Pay Insurance Premiums. In the event the City shall fail to maintain full insurance coverage required by this Agreement, Southwest, acting on behalf of the Corporation, or the Trustee may (but shall be under no obligation to) take out the required policies of insurance, pay the required premiums or otherwise comply with the covenants set forth in Section 803 hereof. All amounts advanced by Southwest, acting on behalf of the Corporation, or the Trustee in payment of the required premiums for such insurance or otherwise to comply with the covenants set forth in such Section shall be paid by the City to the one making the advances, together with interest thereon at the Trustee’s prime rate of interest. ARTICLE IX PREPAYMENT OF FACILITIES PAYMENTS Section 901. In Connection With Optional Redemption of Bonds. Southwest shall have the option to prepay the Facilities Payments due pursuant to Section 501 hereof with respect to the Bonds for the purpose of providing for the redemption of the Bonds then Outstanding in accordance with the Indenture. In order to exercise such right, Southwest shall: (i) give conditional written notice of the exercise of such right to the Corporation, the City and the Trustee not more than one hundred twenty (120) days nor less than forty-five (45) days prior to the date Southwest has selected for the redemption of the Bonds; and (ii) irrevocably deposit with the Trustee in the Debt Service Fund on or prior to such redemption date sufficient moneys, which, together with investment earnings thereon to such redemption date and other moneys in the Debt Service Fund available therefor, shall be sufficient to provide for the payment of the principal, redemption premium, if any, and interest on the Bonds to be redeemed on such redemption date. Section 902. In Connection with Defeasance of the Bonds. Southwest shall have the option to prepay the Facilities Payments due pursuant to Section 501 hereof with respect to the Bonds for the purpose of providing for the defeasance of the Bonds in accordance with the Indenture. In order to exercise such right, Southwest shall: (i) give written notice of the exercise of such right to the Corporation, the City and the Trustee; and (ii) irrevocably deposit with the Trustee in the Debt Service Fund on or prior to the date of such defeasance sufficient moneys, which, together with investment earnings thereon and other moneys in the Debt Service Fund available therefor, shall be sufficient to provide for the payment of principal of, redemption premium, if any, and interest on the Bonds to the date Southwest has selected for the redemption thereof or the date of maturity, as the case may be, in accordance with the Indenture. Section 903. In Connection with the Termination of this Agreement in the Event of Damage or Destruction or Condemnation. Southwest shall have and is hereby granted the option, in accordance with paragraph (ii) of Subsection 1001(a) and paragraph (iii) of Subsection 1002(a) hereof, to prepay the Facilities Payments due pursuant to Section 501 and to terminate this Agreement in the event of a destruction or damage to or condemnation of the Project for the purpose of redeeming the Bonds then Outstanding in accordance with the Indenture. In order to exercise such right, Southwest shall: (i) give written notice of the exercise of such right to the Corporation, the City and the Trustee not more than one hundred twenty (120) days nor less than forty-five (45) days prior to the date Southwest has selected for the redemption of the Bonds; and (ii) irrevocably deposit with the Trustee in the Debt Service Fund on or prior to such redemption date sufficient moneys which, together with interest thereon to such redemption date and other moneys in the Debt Service Fund available therefor, shall be sufficient to provide for the payment of the principal of and interest on all the Bonds then Outstanding in accordance with the provisions of the Indenture.

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Section 904. In Connection with a Partial Redemption. Southwest shall have the option, in accordance with paragraph (iii) of Subsection 1002(a) hereof to prepay the Facilities Payments due pursuant to Section 501 hereof for the purpose of providing for the redemption of the Bonds then Outstanding in accordance with the Indenture. In order to exercise such right, Southwest shall: (i) give written notice of the exercise of such right to the Corporation, the City and the Trustee not more than one hundred twenty (120) days nor less than forty-five (45) days prior to the date Southwest has scheduled for the redemption of the Bonds; and (ii) irrevocably deposit with the Trustee in the Debt Service Fund on or prior to such redemption date sufficient moneys, which, together with investment earnings thereon to such redemption date and other moneys in the Debt Service Fund available therefor, shall be sufficient to provide for the payment of the principal of and interest on the Bonds to such redemption date. Section 905. In Connection With a Determination of Taxability. Southwest shall be obligated to prepay the Facilities Payments due pursuant to Section 501 hereof with respect to the Bonds in the event of a Determination of Taxability. Such redemption shall occur at a date to be selected by Southwest not more than one hundred twenty (120) days after the occurrence of the Determination of Taxability. Southwest shall irrevocably deposit with the Trustee in the Debt Service Fund on or prior to such redemption date sufficient moneys, which, together with investment earnings thereon to such redemption date and other moneys in the Debt Service Fund available therefor, shall be sufficient to provide for the payment of the principal of and interest on the Bonds to such redemption date. ARTICLE X DAMAGE AND CONDEMNATION

Section 1001. Damage and Destruction. (a) If prior to full payment of the Bonds (or provision for payment thereof having been made in accordance with the provisions of the Indenture) the Project is destroyed (in whole or in part) or is damaged by fire or other casualty, the City shall promptly give written notice thereof to the Corporation, Southwest and the Trustee. All Net Proceeds in an amount less than one million dollars ($1,000,000) per casualty shall be paid to the City to be applied to repair, rebuild or restore the property damaged. Any remaining balance after payment for such repair, rebuilding or restoration shall be retained by the City. Net Proceeds of insurance in excess of one million dollars ($1,000,000) per casualty resulting from such claims for losses shall be paid to and held by the Trustee in the Net Proceeds Account of the Construction Fund created under the Indenture, whereupon the City shall elect to proceed to repair, rebuild or restore the property damaged or destroyed to substantially the same condition as it existed prior to the event causing such damage or destruction, with such changes, alterations and modifications (including the substitution and addition of other property) as may be approved in compliance with the Program Development Agreement and as will not impair productive capacity or the character of the Project, and the Trustee will apply so much as may be necessary of the Net Proceeds to payment of the costs of such repair, rebuilding or restoration, either on completion thereof or as the work progresses, as directed by the City. In the event said Net Proceeds are not sufficient to pay in full the costs of such repair, rebuilding or restoration, the City will, nonetheless, complete the work thereof and will pay that portion of the costs thereof in excess of the amount of said Net Proceeds. Any balance of the Net Proceeds remaining after payment of all the costs of such repair, rebuilding or restoration shall be paid to the City. Any moneys held by the Trustee in the Net Proceeds Account shall, at the written direction of the City, be invested or reinvested by the Trustee in Qualified Investments in accordance with the Indenture. The City shall forthwith pay to the Trustee the amount of any net losses with respect to principal on such investments. (b) If the Bonds have been fully paid (or provision for the payment thereof has been made in accordance with the Indenture) and the Project is destroyed (in whole or in part) or is damaged by fire or other casualty, all Net Proceeds will be paid to the Trustee or a mutually acceptable third party, with any disbursements to be approved by the City and the Corporation, and the City shall elect to proceed promptly to repair, rebuild or restore the property damaged or destroyed to substantially the same condition as it existed prior to the event causing such damage or destruction, with such changes, alterations and modifications (including the substitution and addition of other property) as may be desired by Southwest and as will not impair productive capacity or the

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character of the Project, and the City will apply so much as may be necessary of the Net Proceeds to payment of the costs of such repair, rebuilding or restoration, either on completion thereof or as the work progresses as directed by the City. In the event the Net Proceeds are not sufficient to pay in full the costs of such repair, rebuilding or restoration, the City will, nonetheless, complete the work thereof and will pay that portion of the costs thereof in excess of the amount of the Net Proceeds. Any balance of the Net Proceeds remaining after payment of all the costs of such repair, rebuilding or restoration shall be paid to the City. (c) Within this Section 1001, "Net Proceeds" means the gross proceeds from the insurance with respect to which that term is used remaining after payment of all expenses (including attorneys expenses and any extraordinary fees and expenses of the Trustee), incurred in the collection of such gross proceeds.

Section 1002. Condemnation. (a) In the event that title to, or the temporary use of, the Project or any part thereof shall be taken under the exercise of the power of eminent domain, including a permanent closure of the Airport as described in Section 3.4(f) of the Revenue Credit Agreement, by any governmental body or by any person, firm or corporation acting under governmental authority, in each case other than the City, while any Bonds are Outstanding, Southwest shall be obligated to continue to pay the Facilities Payments and other amounts due to the Trustee. Any Net Proceeds derived for the temporary use or condemnation of the Project shall be paid to the City. The City will cause any other Net Proceeds received by the City from any award made in such eminent domain proceedings with respect to the Project, to be paid to and held by the Trustee in the Net Proceeds Account, to be applied in one or more of the following ways, as shall be directed in writing by the City:

(i) The restoration of the Project to substantially the same condition as existed prior to the exercise of the said power of eminent domain.

(ii) Redemption of any of the Bonds together with accrued interest thereon to the date of redemption; provided, that no part of any such condemnation award may be applied for such redemption, unless all of the Bonds are to be redeemed or, in the event that less than all of the Bonds are, to be redeemed, the City shall certify to the Corporation, Southwest and the Trustee that (A) the property forming a part of the Project that was taken by such condemnation proceedings is not essential to the operation of the Airport, or (B) the Project has been restored to a condition substantially equivalent to its condition prior to the taking by such condemnation proceedings, or (C) improvements have been acquired which are suitable for the operation of the Airport as contemplated by the foregoing paragraph (i) of this Subsection 1002(a). The City may elect to proceed pursuant to this paragraph (ii) only if the Project has been condemned (x) to such extent that, in the opinion of the City expressed within a period of six consecutive months following such condemnation it is not practicable or desirable to rebuild, repair or restore the Project, or (y) to such extent that, in the opinion of the City, the City is or will be thereby prevented from carrying on its normal operations at the Airport for a period of six consecutive months.

(b) The City shall notify the Corporation, Southwest and the Trustee in writing as to which of the ways specified in this Section the City elects to have the condemnation award applied. Any balance of the Net Proceeds of the award in such eminent domain proceedings in an amount necessary to redeem the then Outstanding Bonds shall be paid into the Debt Service Fund. If the Bonds have been fully paid (or provision for payment thereof has been made in accordance with the provisions of the Indenture), all Net Proceeds will be retained by the City. (c) Any moneys held by the Trustee in the Net Proceeds Account of the Construction Fund under the provisions of the preceding paragraph shall, at the written request of the City, be invested or reinvested by the Trustee in Qualified Investments in accordance with the provisions of the Indenture. The City shall forthwith pay to the Trustee the amount of any net losses with respect to principal on such investments. (d) Within this Section 1002, "Net Proceeds" means the gross proceeds derived from the condemnation award with respect to which that term is used after payment of all expenses (including attorney's expenses and any extraordinary expenses of the Trustee) incurred in connection with the collection of such gross

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proceeds. ARTICLE XI ADDITIONAL BONDS Section 1101. Additional Bonds. If Southwest is not in default hereunder, the Corporation will issue pursuant to an indenture between the Corporation and the trustee thereunder (which may be an indenture supplemental to the Indenture) the amount of Additional Bonds specified by Southwest to provide funds to pay or to reimburse Southwest for costs incurred by Southwest for any one or more of the following: (a) the costs of completing the Project, (b) the costs of the issuance and sale of the Additional Bonds and other costs reasonably related to the financing as shall be agreed upon by Southwest and the City, and (c) the refunding of Outstanding Bonds (including Additional Bonds, if any); provided that:

(i) the terms of such Additional Bonds, the purchase price to be paid therefor, and the manner in which the proceeds therefrom are to be disbursed, shall have been approved in writing by Southwest;

(ii) the Corporation, the City and Southwest shall have entered into a Supplemental Agreement to provide that Southwest shall make additional payments in an amount at least sufficient to pay principal of, interest, and premium, if any, on the Additional Bonds when due;

(iii) the Corporation shall have otherwise complied with the provisions of said indenture with respect to the issuance of such Additional Bonds; and

(iv) there shall be delivered to the Trustee an opinion of Bond Counsel to the effect that the issuance of such Additional Bonds shall not adversely affect the exemption from gross income for federal income tax purposes of interest on the Bonds.

Section 1102. Approval of State Agencies. To the extent required by State law, no Additional Bonds shall be issued without the prior approval of the Attorney General of Texas. ARTICLE XII AUTOMATIC TERMINATION OF AGREEMENT If no Bonds remain Outstanding under the Indenture, and the lien created by the Indenture is discharged and satisfied pursuant to Article VIII of the Indenture, and Southwest is not in default in the payment of Facilities Payments and other amounts payable to the Corporation hereunder, this Agreement automatically shall terminate. ARTICLE XIII EVENTS OF DEFAULT

Section 1301. Events of Default. The following shall constitute Events of Default: (a) the failure of Southwest to pay any installment of Facilities Payments pursuant to Section 501 hereof, which results in the occurrence of an "Event of Default" as described in Article V(C)(1) or Article V(C)(2) of the Indenture; (b) the occurrence of an Act of Bankruptcy, provided that with respect to the filing of an involuntary

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petition in bankruptcy or other commencement of a bankruptcy or similar proceeding against Southwest, such petition or proceeding shall remain undismissed for ninety (90) days; (c) (i) failure by Southwest to observe and perform any covenant, condition or agreement on its part to be observed or performed pursuant to Sections 201 or 604 hereof, or (ii) any violation of an FAA, TSA or United States Department of Transportation regulation that (A) deprives the City of the use of or the power to operate all or a portion of the Airport or (B) prevents the City from obtaining an airport development grant in aid from the United States Government, where such occurrence set forth in (i) or (ii) shall continue for a period of thirty (30) days after written notice to Southwest specifying such failure and requesting that it be remedied, given to Southwest by the Corporation or the City, unless the City shall agree in writing to an extension of such time prior to its expiration. If a failure under this Subsection is such that it cannot be corrected within the applicable period, it shall not constitute an Event of Default if corrective action is instituted by Southwest within the applicable period and diligently pursued until the failure is corrected; (d) (i) failure by Southwest to observe and perform any covenant, condition or agreement on its part to be observed or performed, other than as referred to in Subsections (a) through (c) above, for a period of sixty (60) days after written notice to Southwest, specifying such failure and requesting that it be remedied, given to Southwest by the Corporation, unless the Corporation shall agree in writing to an extension of such time prior to its expiration; provided, however, if a failure under this clause (i) is such that it cannot be corrected within the applicable period, it shall not constitute an Event of Default if corrective action is instituted by Southwest within the applicable period and diligently pursued until the failure is corrected; or (ii) election of the Corporation to declare an Event of Default as provided in Subsection 604(d) hereof; (e) the occurrence of an "Event of Default" as described in Section 8.1 of the Program Development Agreement; or (f) the occurrence of an "Event of Default" as defined in the Airport Use and Lease Agreement. The provisions of Subsections (c) and (d) shall be subject to the provisions of Section 1705 hereof. Section 1302. Remedies of the Trustee for Certain Events of Default. Upon the occurrence of any Event of Default described in Subsections 1301(a) or (b), the Trustee, as assignee pursuant to Section 503 hereof, may in its discretion and shall upon the direction of the Owners of at least twenty-five percent (25%) of the principal amount of Bonds Outstanding, join in or separately initiate whatever action at law or in equity as may appear necessary or desirable to collect the Facilities Payments due and owing and any other amounts then due to the Trustee under this Agreement including, without limitation, the use and filing of actions for specific performance and mandamus proceedings in any court of competent jurisdiction, against Southwest, and to obtain judgments against Southwest for, or to seek the appointment of a receiver in equity to collect, the Facilities Payments due and owing and any other amounts then due to the Trustee under this Agreement. No waiver by the Corporation of an Event of Default described in Subsections 1301 (c) or (d) shall adversely affect the Trustee's rights under this Section 1302.

Section 1303. Remedies of the Corporation and the City on Default. (a) If any Event of Default shall have occurred, the Corporation or the City may, in its own name and for its own account, without impairing the ability of the Corporation or the City to pursue any other remedy provided for in this Agreement or now or hereafter existing at law or in equity or by statute, institute such action against Southwest as may appear necessary or desirable to collect Facilities Payments and any other amounts then due under this Agreement, or to enforce performance and observance of such covenant, condition or obligation of Southwest hereunder, or to recover damages for Southwest's non-payment, non-performance or non-observance of the same. (b) Upon the occurrence of any Event of Default described in Subsections 1301 (b), (c), (e) or (f), the Corporation or the City may (i) by giving Southwest written notice upon the occurrence of any Event of Default described in Subsections 1301(c), (e) and (f) and without giving Southwest notice upon the occurrence of an Event

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of Default described in Subsection 1301(b), declare this Agreement to be terminated, (ii) exclude Southwest from possession of any space at the Airport subject to the terms of the Airport Use and Lease Agreement and reenter the same; and (iii) take whatever action at law or in equity as may appear necessary or desirable to collect the rentals and any other amounts then due, to enforce performance and observance of any covenant, condition or obligation of Southwest hereunder, or to recover damages for Southwest's non-payment, non-performance or non-observance of the same. (c) Southwest shall pay all of the Corporation's and the City’s reasonable fees and expenses, including reasonable attorneys' fees, in enforcing any covenant to be observed by Southwest or pursuing any remedy upon an Event of Default.

Section 1304. Southwest to Remain Liable for Payments. Notwithstanding the exercise by the Corporation or the City of its remedies pursuant to Section 1303 hereof or the exercise by the Trustee of its remedies pursuant to Section 1302 hereof or the Indenture, Southwest shall continue to be liable for the payment of all amounts payable under Article V hereof and other amounts payable under this Agreement and Southwest shall make such payments at the same times and in the same manner as provided in this Agreement. Section 1305. No Remedy Exclusive. No remedy herein conferred upon the Corporation is intended to be exclusive of any other available remedy or remedies, and each such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. No delay or omission to exercise any right or power accruing upon any default granted under this Agreement shall impair any right or power or shall be construed to be a waiver thereof, and any such right or power may be exercised from time to time and as often as may be deemed expedient, and the exercise of any one right or remedy shall not impair the right of the Corporation or the City to any or all other remedies under this Agreement. Section 1306. No Additional Waiver Implied By One Waiver; Consents to Waiver. The waiver of either party of any breach by the other party of any covenant, condition or obligation under this Agreement shall not operate as a waiver of any subsequent breach of the same or a waiver of any breach of any other covenant, condition or obligation under this Agreement, nor shall any forbearance by the non-defaulting party not breaching to seek a remedy for any breach by the other party be a waiver by such non-defaulting party not breaching any of its rights and remedies with respect to such breach or any subsequent breach of the same or with respect to any other breach. Section 1307. Suspension. During the time of war or national emergency, Southwest acknowledges that the City shall have the right to lease the Airport landing area or any part thereof to the United States Government for military use to the extent required under federal law. If any such lease is executed, any provisions of this instrument which are inconsistent with the provisions of the lease to the United States Government shall be suspended; provided that the term of this Agreement shall be extended by the amount of the period of suspension; provided that such shall not affect Southwest's obligations to pay Facilities Payments pursuant to Section 501 and the City’s obligation to reimburse Southwest pursuant to Section 3.4 of the Revenue Credit Agreement, and provided further that the City obtains an opinion of Bond Counsel that such extension does not affect the exemption from gross income of interest on the Bonds for federal income tax purposes. Section 1308. Delay not a Waiver. No delay or omission by the Corporation or the City of the exercise of any right or power accruing upon any Event of Default shall impair any such right or power or shall be construed to be a waiver of any such Event of Default or any acquiescence therein, and every power or remedy given by this Agreement to the Corporation and the City may be exercised from time to time and as often as may be deemed expedient. The Corporation and the City may waive any Event of Default which in its opinion has been remedied before the entry of final judgment or decree in any suit, action or proceeding instituted by it under the provisions of this Agreement or before the completion of the enforcement of any other remedies under this Agreement. No such waiver shall extend to or affect any other existing or subsequent Event of Default or impair any rights or remedies consequent thereon.

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ARTICLE XIV DEFAULT BY THE CORPORATION OR THE CITY Section 1401. Default by the Corporation; Remedies of Southwest. The Corporation shall in no event be in default in the performance of any of its obligations hereunder unless and until the Corporation shall have failed to perform such obligation within sixty (60) days, or such additional time as is reasonably required in the opinion of Southwest and the Trustee, to conduct any such default, after notice by Southwest to the Corporation and, so long as any of the Bonds are outstanding, to the Trustee, properly specifying wherein the Corporation has failed to perform any such obligation; but, so long as any of the Bonds are Outstanding, neither the occurrence nor existence of any default by the Corporation shall relieve Southwest of any of its obligations hereunder, including, without limitation, its obligation to pay Facilities Payments under Section 501 hereunder, to provide indemnification under Section 801 hereof, or to provide insurance under Section 903 hereof; provided, however, Southwest may institute such action against the Corporation as Southwest may deem necessary to compel performance or recover its damages for non-performance. Southwest shall have the right, to the extent permitted by law, to perform the obligations of the Corporation hereunder if the Corporation does not so perform. Southwest shall have the right in addition to instituting any such action, to terminate this Agreement upon sixty (60) days' notice to the Corporation and the Trustee, and upon payment to the Trustee of that amount which, together with any monies available for that purpose under the provisions of the Indenture, will be sufficient to pay or redeem, or provide for such payment or redemption of, the Bonds then Outstanding on the first practicable retirement or redemption date thereof, including principal, premium, if any, and interest to the redemption date, this Agreement shall forthwith cease and determine and the parties hereto shall be released and discharged of and from all further obligations hereunder, without prejudice, subject, however, to any claim which may have occurred prior thereto in favor of either party against the other and to the provisions that by the terms of this Agreement specifically survive the term hereof. Section 1402. Default by the City; Remedies of Southwest. The City shall in no event be in default in the performance of any of its obligations hereunder unless and until the City shall have failed to perform such obligation within sixty (60) days, or such additional time as is reasonably required in the opinion of Southwest and the Trustee, to conduct any such default, after notice by Southwest to the City and, so long as any of the Bonds are outstanding, to the Trustee, properly specifying wherein the City has failed to perform any such obligation; but, so long as any of the Bonds are Outstanding, neither the occurrence nor existence of any default by the City shall relieve Southwest of any of its obligations hereunder, including, without limitation, its obligation to pay Facilities Payments under Section 501 hereunder, to provide indemnification under Section 801 hereof, or to provide insurance under Section 903 hereof; provided, however, Southwest may institute such action against the City as Southwest may deem necessary to compel performance or recover its damages for non-performance. Southwest shall have the right, to the extent permitted by law, to perform the obligations of the City hereunder if the City does not so perform. Southwest shall have the right in addition to instituting any such action, to terminate this Agreement upon sixty (60) days' notice to the City and the Trustee, and upon payment to the Trustee of that amount which, together with any monies available for that purpose under the provisions of the Indenture, will be sufficient to pay or redeem, or provide for such payment or redemption of, the Bonds then Outstanding on the first practicable retirement or redemption date thereof, including principal, premium, if any, and interest to the redemption date, this Agreement shall forthwith cease and determine and the parties hereto shall be released and discharged of and from all further obligations hereunder, without prejudice, subject, however, to any claim which may have occurred prior thereto in favor of either party against the other and to the provisions that by the terms of this Agreement specifically survive the term hereof. ARTICLE XV DISPUTE RESOLUTION Any Dispute that arises among the parties to this Agreement, concerning this Agreement, shall be resolved in accordance with the dispute resolution process set forth in the Program Development Agreement.

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ARTICLE XVI ASSIGNMENT Section 1601. Successors and Assignments. Except as provided in Section 603 hereof, Southwest shall not assign this Agreement or any part thereof in any manner whatsoever or assign any of the privileges recited herein without the prior written consent of the City. In the event of such assignment, Southwest shall remain liable to the Corporation and the City for the remainder of the term of the Agreement to pay to the Corporation, the City or the Trustee the payments provided for in Section 501 hereof and to otherwise comply with the provisions of the Agreement for the term of this Agreement and Southwest's assignee shall agree to comply with the applicable provisions of this Agreement. Said assignee shall not further assign its interest in this Agreement except with the prior written approval of the City and Southwest; and any assignment by Southwest shall contain a clause to this effect. Any assignment in violation of this Section 1601 shall be void. Section 1602. Opinion of Bond Counsel Required. No assignment of this Agreement by Southwest will be effective unless, in the opinion of Bond Counsel delivered to the Trustee, such assignment will not adversely affect the exclusion from gross income for federal income tax purposes of the interest on any Bonds. ARTICLE XVII GENERAL PROVISIONS Section 1701. Non-Interference with Operation of Airport. Southwest, by accepting this Agreement, expressly agrees for itself and its successors and assigns that it will not make use of the Project in any manner which might interfere with the landing and taking off of aircraft at the Airport or otherwise constitute a hazard. In the event the aforesaid covenant is breached, the City shall have the right to enter upon the Project and cause the abatement of such interference at the expense of Southwest. The City shall maintain and keep in repair the Airport landing areas, including taxiways and aircraft parking apron located outside the Project and shall have the right to direct and control all activities of Southwest in this regard. Section 1702. Attorney's Fees. In any action brought by any party to this Agreement or the Trustee for the enforcement of the provisions hereof, the prevailing party shall be entitled to recover interest and its reasonable attorney's fees pursuant to Section 272.159 of the Texas Local Government Code, as amended. Section 1703. License Fees and Permits. Southwest shall obtain and pay for all licenses, permits, fees or other authorization or charges as required under federal, State or local laws and regulations insofar as they are necessary to comply with the requirements of this Agreement and the privileges extended hereunder. Section 1704. Amendments to this Agreement. If at any time that Bonds are then Outstanding (including if provisions have been made for the payment thereof in accordance with the provisions of the Indenture), and Southwest, the City and the Corporation wish to amend, modify, change, alter or terminate this Agreement by execution of a Supplemental Agreement, and pursuant to Article IX of the Indenture, the consent of the Trustee or Bondholders to such Supplemental Agreement is necessary, such alteration, amendment, change, modification or termination shall become effective only upon the prior written consent of the Trustee and the required percentage of Bondholders is obtained in accordance with the provisions of Article IX of the Indenture; provided, that an amendment (1) to cure any ambiguity, formal defect, omission or inconsistent provision herein, or (2) to modify the definition of Project herein, or (3) to modify or amend this Agreement in a manner in which, in the opinion of Bond Counsel, is unnecessary in order to assure the exclusion from gross income of interest on the Bonds pursuant to section 103(a) of the Code, or (4) to make any other change that, in the opinion of Bond Counsel, does not

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materially and adversely affect the interests of the Bondholders, may be made without the consent of the Bondholders. Southwest, the City and the Corporation specifically reserve the right to execute a Supplemental Agreement, without the consent of the Trustee, to provide for additional payments to secure future obligations undertaken by the Corporation on behalf of Southwest (other than additional Facilities Payments securing Bonds or Additional Bonds), provided that such additional payments shall be payable on a parity basis or subordinate to the Facilities Payments. Section 1705. Force Majeure. Neither the Corporation, the City nor Southwest shall be deemed to be in breach of this Agreement and no default shall arise hereunder by reason of failure to perform any of its obligations hereunder, if, while, and to the extent that such failure is due to the occurrence of a Force Majeure. This provision shall not apply to failures by Southwest to pay rents, fees, or other charges, or to make any other money payments required by this Agreement. This provision shall not prevent the Corporation or the City from exercising its rights upon the occurrence of an Event of Default described in Subsections 1301(a) and (b) hereof. Section 1706. References to Bonds, the Corporation, the Trustee and the Indenture Ineffective when Bonds are no Longer Outstanding. From and after such time as there are no longer any Bonds Outstanding, and all fees and charges of the Trustee and any paying agents for the Bonds have been paid or provided for, to their respective satisfaction, all references in this Agreement to the Bonds, the Corporation, the Trustee and the Indenture shall be ineffective and neither the Trustee nor the Owners of any of the Bonds shall thereafter have any rights hereunder, saving and excepting those that shall have theretofore vested. Section 1707. Modifications Hereof and of Indenture. So long as an Event of Default shall not have occurred and be continuing hereunder, the Corporation has covenanted in the Indenture that it will not, without the written consent of Southwest, agree with the Trustee to effectively amend, supplement, change, modify or alter the Indenture in any manner. Southwest shall provide the Trustee with an executed copy of any instrument altering, amending, modifying, or rescinding this Agreement. Section 1708. Paragraph Headings. The paragraph headings contained herein are for convenience in reference and are not intended to define or limit the scope of any provision of this Agreement. Section 1709. Governing Law. This Agreement has been prepared in the State and shall be governed and interpreted in all respects in accordance with the laws of the State. Section 1710. Notices. Whenever any notice or payment (other than a payment required by Section 501) is required by this Agreement to be made, given or transmitted to the parties hereto, such notice or payment (other than a payment required by Section 501) shall be enclosed in an envelope with sufficient postage attached to insure delivery and deposited in the United States mail or overnight delivery, addressed as follows: if to the Corporation, c/o the City of Dallas, City Hall, 5FN, 1500 Marilla, Dallas, Texas 75201, Attention: Chief Financial Officer, with a copy of such notice to be sent in the same manner to the City of Dallas, City Hall, 7DN, 1500 Marilla, Dallas, Texas 75201, Attention: City Attorney; if to the City, 8008 Cedar Springs Road, LB 16, Dallas, Texas 75235-2852. Attention: Director of Aviation; if to Southwest, Southwest Airlines Co., P.O. Box 36611 HDQ-4PF, 2702 Love Field Drive, Dallas, Texas 75235, Attention: Bob Montgomery, with a copy of such notice to be sent in the same manner to Southwest Airlines Co., P.O. Box 36611 HDQ-4PF, 2702 Love Field Drive, Dallas, Texas 75235,, Attention: Michael AuBuchon; and if to the Trustee, 1445 Ross Avenue, Second Floor, MAC T5303-022, Dallas, Texas 75202, Attention: Corporate Trust Services. A duplicate copy of each notice, certificate, request, or other communication given hereunder to the Corporation, the City, Southwest, or the Trustee shall also be given to the others. Southwest, the City, the Corporation, and the Trustee may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates, requests or other communications shall be sent. Section 1711. Party's Consent. Whenever any provision of this Agreement requires the approval, consent or exercise of discretion of any party to this Agreement, such action shall not be unreasonably withheld, conditioned, delayed or exercised.

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Section 1712. Correction of Technical Errors. If, by reason of inadvertence, and contrary to the intention of the City, the Corporation and Southwest, errors are made in this Agreement in the legal descriptions or the references thereto or within any exhibit with respect to the legal descriptions, in the boundaries of any parcel in any map or drawing which is an exhibit, or in the typing of this Agreement or any of its exhibits or any other similar matters, the parties by mutual consent may correct such error by memorandum executed by them without the necessity of amendment of this Agreement. Section 1713. Priority of Agreements. If any of the provisions of this Agreement shall be in conflict with any applicable Legal Requirement, including any rules or regulations of the FAA or TSA, the provisions of such Legal Requirement shall control. If a conflict exists between the provisions of this Agreement, any of the agreements defined in this Agreement or any other agreement concerning or affected by the LFMP, the order of priority set forth in Article XIV of the Program Development Agreement shall govern which documents shall control. Section 1714. Legal Construction. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision hereof and in lieu of each provision that is found to be invalid, illegal or unenforceable, a provision shall be added which is valid, legal and enforceable and is similar in terms as possible to the provision found to be invalid, illegal or unenforceable. Any termination of the original document from which a defined term or provisions thereof incorporated by reference herein shall not affect the defined term or incorporated reference’s use herein. Section 1715. Entire Agreement. This Agreement and all the documents, agreements, exhibits and schedules referenced herein constitute the entire understanding and agreement of the parties and supersede any prior or contemporaneous, written or oral agreements, discussions, negotiations or previous agreements among the parties with respect to the subject matter of this Agreement. Except as expressly provided for in this Agreement, neither this Agreement nor any term hereof may be amended, waived, discharged, or terminated, except by written instrument signed by the parties hereto. Section 1716. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[Execution Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above mentioned. LOVE FIELD AIRPORT MODERNIZATION CORPORATION By:__________________________________ President, Board of Directors (SEAL) By:__________________________________ Secretary, Board of Directors

CITY OF DALLAS, TEXAS MARY K. SUHM, City Manager

By: _______________________ A.C. Gonzalez

Assistant City Manager ATTEST: (SEAL) By: _____________________ Deborah Watkins City Secretary

APPROVED AS TO FORM: THOMAS P. PERKINS, JR., City Attorney

By: ______________________ Robert L. Sims Assistant City Attorney

SOUTHWEST AIRLINES CO. By:________________________ Name: _____________________ Title: ______________________ Date of Execution: _______________

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EXHIBIT A

MASTER GLOSSARY OF TERMS

[See Separate Document]

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DESCRIPTION OF THE PROJECT The Project to be constructed with the proceeds of the Bonds will consist of: SOUTHWEST PROJECTS: AFSP:

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EXHIBIT C

DISBURSEMENT CERTIFICATE

Requisition No._____________

______, 20__

Wells Fargo Bank, National Association, as Trustee 1445 Ross Avenue, Second Floor MAC T5303-022 Dallas, Texas 75202 This certificate is provided to you pursuant to Section 3.03 of that certain Special Facilities Agreement, dated as of ________ 1, 2010 (the "Facilities Agreement"), among LOVE FIELD AIRPORT MODERNIZATION CORPORATION, a Texas local government corporation (the "Corporation"), CITY OF DALLAS, TEXAS, a Texas home rule municipality (the "City") and SOUTHWEST AIRLINES CO., a Texas corporation ("Southwest"). Terms capitalized but not defined in this Requisition shall have the meaning given to such terms in the Facilities Agreement.

On behalf of Southwest, I, the undersigned Authorized Southwest Representative, do hereby certify that:

1 There has been expended, or is being expended concurrently with the delivery of this certificate an amount on account of Costs of the Project at least equal to $________, which amount is hereby requisitioned for disbursement from the Project Construction Account of the Construction Fund. 2. No other certificate in respect of the expenditures requisitioned pursuant to clause (1) is being or previously has been delivered to the Trustee.

3. No Event of Default has occurred and is continuing. 4. If this request is for an initial payment to reimburse Southwest or its designee for certain Costs

incurred on or after April 25, 2008, to the extent such disbursement (a “reimbursement allocation”) is to reimburse an expenditure (an “original expenditure”) that was paid (X) from a source other than the proceeds of the Bonds and (Y) prior to the Closing Date, that such original expenditure is for a proper Cost of the Project and was incurred not more than 60 days prior to the Inducement Date and that the reimbursement allocation is being made not later than 18 months after the later of (A) the date on which such original expenditure was paid or (B) the date on which the property is placed in service or abandoned (but the date of such reimbursement allocation may not be more than three years after the date the original expenditure was paid).

5. The expenditures requested hereby are for proper Costs of the Project incurred on or after April

25, 2008. 6. At least 95% (not including amounts disbursed to pay costs of issuing the Bonds) of all amounts

previously disbursed from the Project Construction Account within the Construction Fund to pay Costs of the Project plus the amount requested by this certificate to be disbursed from the Project Construction Account within the Construction Fund have been or will be used to provide "airport facilities" within the meaning of the Code and the Regulations in effect under the Code and applicable to the Bonds.

7. If applicable, the sum of (A) all amounts previously disbursed from the Project Construction

Account within the Construction Fund to pay costs of issuance (including any amount paid to the underwriters either as discount or fee) plus (B) the amounts requested by this certificate to be disbursed from the Construction Fund to pay costs of issuance does not exceed 2% of the issue price of the Bonds.

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You are hereby directed to pay or transfer, as applicable, the amount requisitioned by clause (1) above from

the Project Construction Account within the Construction Fund specified above to the payee(s) in the amount(s) and by the method(s) of payment set forth in Schedule I hereto.

SOUTHWEST AIRLINES CO. Date: _______________ By: _____________________________ Title: ____________________________ APPROVED: CITY OF DALLAS, TEXAS Date: _______________ By: ______________________________ Title: Director of Aviation

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EXHIBIT D

PFC DISBURSEMENT CERTIFICATE

Requisition No._____________

______, 20__

Wells Fargo Bank, National Association, as Trustee 1445 Ross Avenue, Second Floor MAC T5303-022 Dallas, Texas 75202 This certificate is provided to you pursuant to Section 3.03 of that certain Special Facilities Agreement, dated as of ________ 1, 2010 (the "Facilities Agreement"), among LOVE FIELD AIRPORT MODERNIZATION CORPORATION, a Texas local government corporation (the "Corporation"), CITY OF DALLAS, TEXAS, a Texas home rule municipality (the "City") and SOUTHWEST AIRLINES CO., a Texas corporation ("Southwest"). Terms capitalized but not defined in this Requisition shall have the meaning given to such terms in the Facilities Agreement.

On behalf of Southwest, I, the undersigned Authorized Southwest Representative, do hereby certify that: 1. The Costs of the Project for which this Requisition are submitted are eligible to be paid from

PFCs. 2. There has been expended, or is being expended concurrently with the delivery of this certificate an

amount on account of Costs of the Project at least equal to $________, which amount is hereby requisitioned for disbursement from the PFC Account of the Construction Fund. 3. No other certificate in respect of the expenditures requisitioned pursuant to clause (2) is being or previously has been delivered to the Trustee.

4. No Event of Default has occurred and is continuing. You are hereby directed to pay or transfer, as applicable, the amount requisitioned by clause (1) above from

the PFC Account within the Construction Fund specified above to the payee(s) in the amount(s) and by the method(s) of payment set forth in Schedule I hereto.

SOUTHWEST AIRLINES CO. Date: _______________ By: _____________________________ Title: ____________________________ APPROVED: CITY OF DALLAS, TEXAS Date: _______________ By: ______________________________ Title: Director of Aviation

EXHIBIT C

REVENUE CREDIT AGREEMENT

This Revenue Credit Agreement (this "Agreement") is entered into by and between THECITY OF DALLAS, TEXAS, a Texas home rule municipality (the "City") and SOUTHWESTAIRLINES CO., a Texas corporation ("Southwest"). The City and Southwest are sometimesreferred to herein as the "Parties" and each of the City and Southwest individually is sometimesreferred to as a "Party."

RECITALS:

WHEREAS, the City is the owner of Dallas Love Field (hereinafter defined and referredto as the "Airport"), which is located in the City of Dallas, Dallas County, Texas; and

WHEREAS, on July 11, 2006, the City, the City of Fort Worth, The Dallas-Fort WorthInternational Airport Board, Southwest and American Airlines, Inc. ("American Airlines")entered into that certain "Contract Among The City of Dallas, The City of Fort Worth,Southwest Airlines Co., American Airlines, Inc., and DFW International Airport Boardincorporating the Substance of the Terms of the June 15, 2006, Joint Statement Between theParties to Resolve the Wright Amendment' Issues" (the "Five Party Agreement") affectingDallas Love Field wherein, among other things, the parties thereto agreed to seek to eliminaterestrictions on air service at the Airport set forth in existing federal legislation (commonlyreferred to as the "Wright Amendment"); and

WHEREAS, on October 13, 2006, Public Law 109-352, commonly known as the"Wright Amendment Reform Act of 2006" was signed into law; and

WHEREAS, the Wright Amendment Reform Act of 2006 provides that the interstateflight restrictions imposed on the Airport since 1979 will be lifted on October 13, 2014, inaccordance with other terms and conditions set forth in the Wright Amendment Reform Act of2006; and .

WHEREAS, in the Five Party Agreement, the City and Southwest agreed to thesignificant redevelopment of portions of the Airport, including the modernization of the existingterminal facilities at the Airport, a program referred to as the "Love Field ModernizationProgram" or "LFMP," and the City and Southwest agreed to work toward completion of theLFMP by October 2014, eight (8) years from the enactment of the Wright Amendment ReformAct of 2006; and

WHEREAS, to facilitate the development of the LFMP, the City created the Love FieldAirport Modernization Corporation (the "LFAMC"), a nonprofit corporation organized andexisting under the provisions of Subchapter D, Chapter 431, Texas Transportation Code, to acton behalf of the City in the performance of its governmental functions to promote thedevelopment of the geographic area of the City included at or in the vicinity of the Airport, in

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furtherance of the promotion, development, encouragement, and maintenance of employment,commerce, aviation activity, tourism and economic development in the City; and

WHEREAS, in furtherance of the development of the LFMP, the City, the LFAMC andSouthwest entered into that certain Program Development Agreement, dated January 15, 2009,as modified by Steering Committee Resolutions No. 2009-1 and No. 2009-2 (the "ProgramDevelopment Agreement"); and

WHEREAS, in furtherance of the provisions of the Five Party Agreement, the City andSouthwest entered into that certain Amended and Restated Lease of Terminal Building Premises,effective October 1,2008 (the "Airport Use and Lease Agreement"); and

WHEREAS, the Program Development Agreement and the Airport Use and LeaseAgreement provide that the City and Southwest are undertaking the LFMP, a major capitalprogram to improve and modernize terminal facilities at Love Field; and

WHEREAS, the Program Development Agreement and the Airport Use and LeaseAgreement provide that the LFAMC, at the request of Southwest, shall issue bonds to financeelements ofthe LFMP; and

WHEREAS, the City, the LFAMC and Southwest have entered into a Special FacilitiesAgreement, dated as of , 2010 (the "Facilities Agreement") in order to facilitate theconstruction of elements of the LFMP, as more fully described in the Program DevelopmentAgreement, through the issuance of Bonds, in one or more series, and to provide for therepayment of debt service on the Bonds by Southwest, in the manner provided in the FacilitiesAgreement; and

WHEREAS, the Program Development Agreement provides that a revenue creditagreement will be negotiated at such time as the bond market is favorable for the issuance ofLFAMC Bonds, or the determination by Southwest to fund the "Southwest Projects" (as definedin the Program Development Agreement); and

WHEREAS, this Agreement is entered into under authority of the laws of the State,specifically Sections 22.019 and 22.021 of the Texas Transportation Code, as amended.

NOW, THEREFORE, for and in consideration of the premises and the mutual covenantshereafter contained, the Parties hereto hereby formally covenant, agree and bind themselves asfollows, to wit:

ARTICLE IDEFINITIONS AND CONSTRUCTION

Section 1.1. Definitions. All terms used in this Agreement shall have the samemeanings as are assigned such terms in the Master Glossary of Terms, attached to the Facilities

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Agreement as Exhibit A, unless otherwise defined in this Agreement or unless the use or contextclearly indicates otherwise.

Section 1.2. Interpretations. This Agreement and all of the terms and provisions hereofshall be construed so as to effectuate the purposes contemplated hereby and to sustain thevalidity hereof. The headings or titles of the several Articles and Sections of this Agreement, andthe Table of Contents appended hereto, are solely for convenience of reference and shall notaffect the meaning or construction of the provisions hereof.

In this Agreement, unless the context otherwise requires:

(a) The terms "hereby," "hereof," "herein," "hereunder" and any similar terms, asused in this Agreement, refer to this Agreement, and the term "hereafter" shall mean after, andthe term "heretofore" shall mean before the date of this Agreement.

(b) The singular form of any word used herein shall include the plural, and vice versa,if applicable.

(c) The use of a word of any gender shall include all genders, if applicable.

(d) All references herein to particular Articles or Sections are references to theArticles or Sections of this Agreement, and reference herein to any exhibit means an exhibitattached to this Agreement.

(e) Reference to any document means that document as amended or supplementedfrom time to time in accordance with its terms and, where applicable, the Indenture, andreference to any party to a document means that party and its permitted successors and assigns.

(f) The terms, "include," "includes" and "including" shall mean include, includes andincluding without limitation.

(g) All references to time shall refer to Dallas, Texas time.

ARTICLE IICONSTRUCTION OF THE SOUTHWEST PROJECTS, AFSP AND CITY PROJECTS

Section 2.1. Southwest Projects. As provided in the Program Development Agreementand pursuant to the provisions of the Facilities Agreement, the LFAMC has assigned theresponsibility to construct the Southwest Projects to Southwest. Southwest represents that it hascommenced to design and construct the Southwest Projects, and it hereby covenants that it willdesign and construct the Southwest Projects, in accordance with the terms and conditions setforth in the Program Development Agreement.

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Section 2.2. AFSP. As provided in the Program Development Agreement and pursuantto the provisions of the Facilities Agreement, the LFAMC has assigned the responsibility toconstruct the AFSP to Southwest. Southwest represents that it has commenced to design (andwill soon commence construction), and it hereby covenants that it will design and construct andcomplete, the AFSP in accordance with the terms and conditions set forth in the ProgramDevelopment Agreement.

Section 2.3. City Projects. As provided in the Program Development Agreement, theCity will contract with appropriate and qualified contractors to provide construction services toconstruct the City Projects in accordance with the terms and conditions set forth in the ProgramDevelopment Agreement.

ARTICLE IIIREVENUES FOR SOUTHWEST PROJECTS AND AFSP

Section 3.1. LFAMC Bonds. In accordance with the terms and conditions of theProgram Development Agreement, the LFAMC, the City and Southwest have entered into theFacilities Agreement, whereunder Southwest has agreed to (1) design and construct the projectsdescribed in the Facilities Agreement, which comprise all or a portion of the Southwest Projectsand the AFSP, in accordance with the terms of the Program Development Agreement, (2) makeFacilities Payments at the times and in the amounts sufficient to pay the principal of, premium, ifany, and interest on the LFAMC Bonds, as the same become due and owing, and (3) performsuch other duties as set forth in the Facilities Agreement.

Section 3.2. Federal Grants. The Parties, in the Program Development Agreement,agreed to cooperate to maximize the amount of federal grants supporting the LFMP Elementseligible for such grants, subject to and consistent with other capital improvement program needsof the Airport. To the extent moneys from federal grants are received by the City for projects thatcomprise all or a portion of the Southwest Projects or the AFSP, as described in Exhibit Battached hereto, subject to FAA approval, the City agrees to transfer such moneys, in accordancewith Section 4.5 of this Agreement, to the Trustee if and when received, for deposit in theFederal Grants Subaccount within the City Contributions Account for project expenditurescovered by such grants.

Section 3.3. PFC Revenues. In the Program Development Agreement, the City agreedto apply for and, to the extent approved for such purpose, utilize certain PFC revenues to (1)fund, on a "pay-as-you-go basis", a portion of the costs of certain LFMP Elements eligible forfederal grants and (2) defray the debt service on LFAMC Bonds issued to finance LFMP Costs,consistent with and as further described in Exhibit B attached hereto.

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(a) PFC Revenues Used to Pay Costs of the Project. To the extent PFC revenues arecollected by the City to fund all or a portion of the designated PFC-eligible elements of theSouthwest Projects or the AFSP, as described in Exhibit B attached hereto, the City agrees totransfer such moneys, in accordance with Section 4.6(a) of this Agreement, to the Trustee fordeposit to the PFC Account within the Construction Fund for project expenditures eligible forsuch approved PFC amounts.

(b) PFC Revenues Used to Defray Debt Service. In accordance with the terms of theProgram Development Agreement and the Airport Use and Lease Agreement, the City presentlyintends to utilize $10,000,000 of annual PFC revenues to pay Debt Service on the LFAMCBonds issued to finance LFMP Costs. The Parties acknowledge and agree that the actualamount of PFC revenues to be used for this purpose could vary, up or down, and is subject to (1)the City obtaining all necessary approvals from the FAA in future applications to impose and usea PFC at the Airport at a rate of $4.50 or higher for such purpose, (2) the eligibility of anadequate portion of the LFMP capital costs, and (3) the ability of the City to develop afinancially feasible plan for the Connector, which plan will also rely on funding from PFCrevenues and may limit the amount of PFC revenues available to defray Debt Service on theLFAMC Bonds To the extent PFC revenues are collected by the City to defray a portion of theDebt Service on the LFAMC Bonds, the City shall transfer such moneys from the PFC Fund tothe Trustee for deposit in the PFC Subaccount within the City Contributions Account, inaccordance with Section 4.6(b) ofthis Agreement.

Section 3.4. Reimbursements to Southwest.

(a) Reimbursement from Available Revenues.

(i) Reimbursement Obligation During Term of Current Airport Use and LeaseAgreement. Subject to the covenants of the City contained in the proceedings authorizingthe issuance of GARBs currently outstanding, Available Revenues shall be used toreimburse Southwest for Facilities Payments made by Southwest under the FacilitiesAgreement (the "Reimbursement Obligation"). During the term of the Airport Use andLease Agreement, the ability of the City to fulfill the Reimbursement Obligation isdependent upon the Available Revenues being sufficient for such purpose. AvailableRevenues shall constitute the sole source of funds from which the City shall fulfill theReimbursement Obligation.

(ii) Reimbursement Obligation After Expiration/Termination of Current Airport Useand Lease Agreement. During the period of time from either the expiration or earliertermination of the current Airport Use and Lease Agreement through the end of the City'sfiscal year following the final maturity of the LFAMC Bonds (the "Remaining Term"),subject to (A) the terms contained in Section 3.4(e) of this Agreement, (B) the conditionscontained in this Section 3.4(a)(ii), and (C) in accordance with then-current FAA policies

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and state and federal law in effect at such time, the City shall establish, charge and collectthrough the rates and charges mechanism airline rates and charges to produce AirportSystem net revenues for deposit to the Southwest Reimbursement Account sufficient toreimburse Southwest for Facilities Payments made by Southwest. During the RemainingTerm, the City's Reimbursement Obligation is expressly conditioned upon either: (1)Southwest maintaining a Material Presence at the Airport; or (2) the City collectingrevenue on at least 75% of the Gates at the Airport under a written lease or permit withone or more commercial passenger airlines. During any portion of time in the RemainingTerm where neither of the two conditions in the preceding sentence is being satisfied,then, in such event, the City's Reimbursement Obligation shall be suspended for suchperiod until at least one of the two aforementioned conditions is being met. AirportSystem net revenues shall constitute the sole source of funds from which the City shallfulfill the Reimbursement Obligation during the Remaining Term.

(b) Transfers to Southwest Reimbursement Account. To the extent sufficient AirportSystem net revenues are available for such purpose, the City agrees to transfer AvailableRevenues to the Southwest Reimbursement Account, established in Section 4.1 of thisAgreement, for deposit and transfer in accordance with the provisions of Sections 4.2 and 4.3 ofthis Agreement. Except as provided in Sections 3.4(d) and 4.10 of this Agreement, the Cityagrees to transfer Available Revenues to the Southwest Reimbursement Account until such timeas all Facilities Payments made by Southwest have been reimbursed in full by the City.

(c) Insufficient Available Revenues. Should Southwest make a Facilities Paymentand at the time such Facilities Payment is made moneys in the Southwest ReimbursementAccount are not sufficient to enable the City to reimburse Southwest in full for the amount ofsuch Facilities Payment, the City agrees to transfer all of the moneys from the SouthwestReimbursement Account to Southwest as partial reimbursement for such Facilities Payment.Thereafter, the City agrees, to the extent that Available Revenues are sufficient for such purpose,the City shall transfer moneys from the Southwest Reimbursement Account to Southwest (1)first, as Available Revenues are deposited into the Southwest Reimbursement Account, to fundthe amounts necessary to reimburse Southwest for prior Facilities Payments made but notreimbursed in full upon their initial payment and (2) second, to reimburse Southwest for theFacilities Payment most recently made to pay Debt Service on the LFAMC Bonds; provided, thatthe City shall not be required to reimburse Southwest for Facilities Payments made by Southwestbut not fully reimbursed by the City occurring (1) after a Reimbursement Termination Event or(2) as provided in Section 3.4(d) of this Agreement.

(d) Cessation of Reimbursement. The parties agree that the obligation of the City toreimburse Southwest for Facilities Payments made by Southwest under the Facilities Agreement,and for which Southwest has not been reimbursed in full, shall not extend beyond the expirationof the next ensuing fiscal year of the City, after the final maturity of the LFAMC Bonds,

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coincident with the settlement process as provided in the then existing airport use and leaseagreement. Thereafter, the obligation of the City to reimburse Southwest shall terminate.

(e) Calculation of Reimbursement in the Event of Defeasance of Prior OptionalRedemption of LFAMC Bonds. The parties acknowledge and agree that (1) Southwest shallhave the right under the Facilities Agreement to prepay Facilities Payments to effect adefeasance or redemption of LFAMC Bonds, and (2) any prepayment ofFacilities Payments mayimpact the rates and charges payable by Southwest under the terms of the Airport Use and LeaseAgreement. Southwest agrees to provide the City and the Corporation with forty-five (45) daysprior written notice of the determination by Southwest to prepay Facilities Payments inaccordance with the Facilities Agreement for the purpose of effecting a defeasance orredemption of LFAMC Bonds. Upon receipt of such notice, the City and Southwest agree thatthey will use reasonable efforts to formulate a method by which rates and charges for use of theAirport will be established to enable the City to produce revenues for deposit to the SouthwestReimbursement Account to fulfill its Reimbursement Obligation as described in this Agreementand a schedule pursuant to which reimbursements to Southwest shall be made. No prepaymentshall occur until such method has been agreed upon by the City and Southwest.

(f) Reimbursement Termination Event. Anything contained in this Agreement tocontrary, the obligation of the City to continue to make any transfers under this Agreement shallcease upon the occurrence of a Reimbursement Termination Event.

Section 3.5. Covenants of City. The City hereby covenants:

(a) Federal Grants. Subject to and consistent with the City's need to fund the capitalimprovement program at the Airport, the City shall cooperate with Southwest in seeking andapplying for federal grants to maximize the amount of federal funds in support of the LFMPElements eligible for federal funding.

(b) PFCs. The City shall apply for the use of PFCs to fund projects designated forPFC-funding, as described in Exhibit B attached hereto.

(c) City to Maintain Accounts. The City shall deposit to the credit of the SouthwestReimbursement Account the Available Revenues described in Section 3A(a) of this Agreement,solely for the purpose of providing funds to reimburse Southwest in consideration of theundertaking of the Southwest Projects and the AFSP, consistent with the terms of the ProgramDevelopment Agreement and the Airport Use and Lease Agreement.

Section 3.6. Covenants of Southwest. Southwest hereby covenants:

(a) Federal Grants. Southwest shall cooperate with the City in seeking and applyingfor federal grants to maximize the amount of federal funds in support of the LFMP Elements that

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are eligible for federal funding, subject to and consistent with the City's need to fund the capitalimprovements program at theAirport.

(b) Money Transferred from Southwest Reimbursement Account. The City shalltransfer money from the Southwest Reimbursement Account to Southwest for the followingpurposes: (l) to reimburse Southwest for the payment of Facilities Payments pursuant to theFacilities Agreement in support of paying Debt Service on the LFAMC Bonds; and (2) to payother costs and expenses associated with the Southwest Projects, the AFSP or the LFAMCBonds paid or incurred by Southwest, including Southwest's obligation to pay costs andexpenses under Section 505 and 605 of the Facilities Agreement, as agreed upon by the City andSouthwest. Southwest acknowledges that neither the City nor the LFAMC shall be obligated tomake any Facilities Payments, and that Southwest is solely responsible for making the FacilitiesPayments to the Trustee. The City acknowledges that the execution and delivery of thisAgreement is a critical inducement for Southwest to undertake the duties and obligations ofSouthwest as described in the Program Development Agreement, and for Southwest to assumesole responsibility for the payment of the Facilities Payments.

ARTICLE IVESTABLISHMENT OF

SOUTHWEST REIMBURSEMENT ACCOUNT;TRANSFERS TO TRUSTEE OR SOUTHWEST

Section 4.1. Establishment of Southwest Reimbursement Account. The City shallestablish and maintain, and does hereby establish with the depository bank of the City, theSouthwest Reimbursement Account.

Section 4.2. Requisition of Moneys from Southwest Reimbursement Account toSouthwest. Prior to 12:00 noon, three Business Days prior 0 the next scheduled Debt Servicepayment date, in accordance with the Facilities Agreement, Southwest shall deliver to theAviation Director a certificate (the "Reimbursement Requisition"), substantially in the formattached to this Agreement as Exhibit A, certifying (1) the amount of funds to be transferred bySouthwest to the Trustee to make a Facilities Payment, (2) that the amount described in clause(1) will be sufficient, together with other moneys held by the Trustee for such purpose, to makethe Debt Service payment in full on the Debt Service payment date, (3) the amount, in additionto the anticipated Debt Service amount due as set forth in clause (l) above, of other costs andexpenses associated with the Southwest Projects, the AFSP, or the LFAMC Bonds for whichSouthwest requests reimbursement, (4) the amount, if any, of Facilities Payments made bySouthwest that were not previously reimbursed and which are to be paid to Southwest, and (5)the moneys for which a requisition is requested are to be accepted by Southwest solely for thepurposes described in Section 3.6(b) of this Agreement. Not later than the next Business Day

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after receiving an executed certificate from Southwest, the City shall deliver to Southwest anexecuted acknowledgment evidencing receipt of the certificate submitted by Southwest.

Section 4.3. Deposits to Southwest Reimbursement Account. Upon receipt of theReimbursement Requisition, and to the extent the City has Available Revenues for such purpose,prior to 12:00 noon, one Business Day prior to the next scheduled Debt Service payment date,the City shall deposit Available Revenues to the credit of the Southwest Reimbursement Accountin such amount as stated by Southwest in the Reimbursement Requisition, to reimburseSouthwest for the Facilities Payment made by Southwest with respect to the payment of DebtService on the LFAMC Bonds and other costs and expenses reimbursable under Section 3.6(b)hereof.

Section 4.4. Transfers from Southwest Reimbursement Account. Upon confirmationfrom the Trustee that Southwest has made the Facilities Payment in an amount sufficient to payDebt Service on the LFAMC Bonds, the City promptly shall transfer to Southwest the moneys ondeposit in the Southwest Reimbursement Account to reimburse Southwest for the amountspecified in the Reimbursement Requisition.

Section 4.5. Transfers of Federal Grant Receipts. Federal grant moneys received bythe City to fund the AlP-eligible elements ofthe Southwest Projects or the AFSP, as described inSection 3.2 ofthis Agreement, shall be immediately deposited by the City in the Aviation CapitalFund and transferred to the Trustee within three Business Days thereafter for deposit to the creditof the Federal Grants Subaccount within the City Contributions Account. The City shall notifySouthwest in writing promptly after making such transfer of the amount transferred from theAviation Capital Fund to the Federal Grant Subaccount within the City Contributions Account.Moneys on deposit in the Federal Grants Subaccount within the City Contributions Account shallbe used solely to pay principal on the LFAMC Bonds.

Section 4.6. Transfer of PFC Revenues. All PFC revenues shall be deposited whenreceived and accumulated in the PFC Fund in a manner consistent with current practice andfederal PFC regulations. Moneys on deposit in the PFC Fund shall be allocated by the City toapproved PFC projects based on the timing of funding needs and other appropriate criteriaestablished by the City.

(a) Project Costs. Moneys on deposit in the PFC Fund and allocated to thedesignated "pay-as-you-go" PFC projects in the LFMP, as described in Section 3.3(a) of thisAgreement, shall be transferred by the City no less often than monthly from the PFC Fund to theTrustee for deposit to the credit of the PFC Account within the Construction Fund for projectexpenditures covered by such approved PFC amounts.

(b) Debt Service on LFAMC Bonds. Moneys on deposit in the PFC Fund andallocated to defray debt service on the LFAMC Bonds, as described in Section 3.3(b) of thisAgreement, shall be transferred semiannually by the City from the PFC Fund to the Trustee fordeposit to the credit of the PFC Subaccount within the City Contributions Account, no later thanthe sixth Business Day prior to the next scheduled Debt Service payment date (the "Deposit

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Date"). It is the intent of the Parties that, subject to the limitations of Section 3.3(b) of thisAgreement, such semiannual transfers shall (1) commence on the Deposit Date occurringimmediately prior to the earlier of (i) the date insufficient moneys are on deposit in theCapitalized Interest Account within the Debt Service Fund for the payment of interest on theBonds on the next scheduled Debt Service payment date or (ii) the date the first principalpayment is due on the Bonds, and (2) be in an amount equal to $5,000,000. The City shall notifySouthwest in writing on the Deposit Date of the amount transferred from the PFC Fund to thePFC Subaccount within the City Contributions Account.

Section 4.7. Limit on Transfers. To the extent there shall be moneys available for suchpurpose, moneys shall be transferred to Southwest from the Southwest Reimbursement Accountpursuant to Section 4.4 of this Agreement in an amount that shall not exceed the amountrequested by Southwest in the Reimbursement Requisition.

Section 4.8. Transfers to Southwest or the Trustee do not Relieve SouthwestObligations under Facilities Agreement. Transfers made to Southwest or the Trustee, asprovided in this Agreement, do not relieve Southwest of the obligation to timely cause thedeposit with the Trustee, under the terms of the Facilities Agreement, Facilities Payments in anamount sufficient, together with other amounts on deposit in the Debt Service Fund for theLFAMC Bonds, to pay in full the Debt Service on the LFAMC Bonds on the next scheduledDebt Service payment date.

Section 4.9. Investment of Moneys. Moneys on deposit in the SouthwestReimbursement Account shall be invested in accordance with the City's investment policy,adopted pursuant to the provisions of Chapter 2256, Texas Government Code. Interest earningsaccruing on moneys in the Southwest Reimbursement Account shall be at all times a part of theSouthwest Reimbursement Account and shall be used in making each reimbursement paymentmade to Southwest pursuant to Section 3.4 hereof. The City has provided to Southwest a true andcorrect copy of the City's current investment policy, and agrees to provide Southwest with a trueand correct copy of any changes to the City's investment policy promptly after the approvalthereofby the City Council.

Section 4.10. Event of Default. Should Southwest fail to make a Facilities Payment asrequired under the Facilities Agreement, the obligation of the City to continue to make anytransfers under this Agreement shall cease, and this Agreement shall terminate.

ARTICLE VREPRESENTATIONS AND WARRANTIES

Section 5.1. Representations of the City. The City represents and warrants toSouthwest as follows:

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(a) Affinnation of Representations and Warranties in Program DevelopmentAgreement. The City affirms that the representations and warranties made by the City containedin the Program Development Agreement are true and correct as of the date of this Agreement.

(b) Litigation or Administrative Proceeding. The City has received no service ofprocess or other written notification of any litigation or administrative proceedings which wouldmaterially and adversely affect the ability of the City to perform any of its obligations hereunder.

(c) Perfonnance Will Not Result in Breach. Performance of this Agreement pursuantto the terms hereof will not result in any breach of, or constitute any default under, anyagreement or other instrument to which the City is a party ofby which the City might be bound.

(d) Execution. The execution and delivery of, and the City's performance under, thisAgreement are within the City's powers and have been duly authorized by all requisite municipalaction. The person executing this Agreement on behalf of the City has the authority to do so.This Agreement constitutes the legal, valid and binding obligation of the City enforceable inaccordance with its terms, subject to the principles of equity.

Section 5.2. Representations of Southwest. Southwest represents and warrants to theCity as follows:

(a) Authorization. Southwest is duly organized and legally existing under the laws ofits state of organization. Southwest is duly qualified to do business in the State.

(b) Affinnation of Representations and Warranties in Program DevelopmentAgreement. Southwest affirms that the representations and warranties made by Southwest in theProgram Development Agreement are true and correct as of the date of this Agreement

(c) Litigation or Administrative Proceeding. Southwest has received no service ofprocess or other written notification of any litigation or administrative proceedings which wouldmaterially and adversely affect the ability of Southwest to perform any of its obligationshereunder.

(d) Perfonnance Will Not Result in Breach. Performance of this Agreement will notresult in any breach of, or constitute any default under any agreement or other instrument towhich Southwest is a party or by which Southwest might be bound.

(e) Execution. The execution and delivery by Southwest of, and Southwest'sperformance under, this Agreement are within Southwest's powers and have been dulyauthorized by all requisite organizational action. The person executing this Agreement on behalfof Southwest has the authority to do so. This Agreement constitutes the legal, valid and bindingobligation of Southwest enforceable in accordance with its terms, subject to the principles ofequity.

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ARTICLE VIMISCELLANEOUS PROVISIONS

Section 6.1. Term. The term of this Agreement shall commence on the date ofdeliveryof the initial series of LFAMC Bonds issued by the LFAMC, and except as otherwise expresslyprovided herein shall expire once all of the LFAMC Bonds are no longer outstanding inaccordance with their terms, and all reimbursement payments have been made to Southwest inaccordance with the terms of this Agreement (the "Term"). Notwithstanding the expiration of theTerm or the earlier termination of this Agreement, the obligations and rights of the Parties hereinthat expressly survive such termination or expiration shall survive such termination or expiration.

Section 6.2. Gift to Public Servant.

(a) The City may terminate this Agreement immediately if Southwest has offered,conferred, or agreed to confer any benefit upon a City employee or official that such Cityemployee or official is prohibited by law from accepting (the City has been advised by theprosecuting authorities that the Section 36.10(b) and (c) exceptions to Section 36.08 and 36.09,respectively, of the Texas Penal Code are not available to public servants who have no legalreporting requirements).

(b) For purposes of this section, "benefit" means anything reasonably regarded aseconomic advantage, including benefit to any other person in whose welfare the beneficiary isinterested, but does not include a contribution or expenditure made and reported in accordancewith the law.

(c) Notwithstanding any other legal remedies, the City may require Southwest toremove any employee of Southwest from the development who has violated the restrictions ofthis Section or any similar state or federal law, and obtain reimbursement for any expendituresmade to Southwest as a result of the improper offer, agreement to confer, or conferring of abenefit to the City employee or official.

Section 6.3. Conflict of Interest of City Employees. The following section of theCharter of the City of Dallas shall be one of the conditions of, and a part of, the consideration ofthis Agreement, to wit:

"CHAPTER XXII. Sec. 11. FINANCIAL INTEREST OF EMPLOYEE OR OFFICERPROHIBITED.

(a) No officer or employee shall have any financial interest, direct or indirect, in anycontract with the City or be financially interested, directly or indirectly, in the sale to the City ofany land, materials, supplies or services, except on behalf of the City as an officer or employee.Any violation of this action shall constitute malfeasance in office, and any officer or employeeguilty thereof shall thereby forfeit the officer's or employee's position with the City. Anyviolation of this section, with knowledge expressed or implied of the person or corporation

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contracting with the City shall render the contract involved voidable by the City Manager or theCity Council.

(b) The alleged violation of this section shall be matters to be determined either bythe trial board in the case of employees who have the right to appeal to the trial board and by theCity council in the case of other employees.

Section 6.4. Governing Law. This Agreement has been prepared in the State and shallbe governed in all respects by the laws of the State and the United States.

Section 6.5. Survival. Except as otherwise expressly provided in this Agreement, therepresentations, warranties, covenants and agreements of the Parties contained or provided for insuch instruments and the Parties' obligations under any and all thereof shall survive theexecution and delivery of such instruments.

Section 6.6. Binding Effect. Except as may otherwise be provided herein to thecontrary, this Agreement and each of the provisions hereof shall be binding upon and inure to thebenefit of the City, Southwest, and their respective permitted successors and assigns.

Section 6.7. Notices. All notices and other communications required or permittedhereunder shall be in writing and shall be mailed by United States mail, first-class, postageprepaid, or delivered by hand, messenger, fax or reputable overnight courier, and shall bedeemed given when received at the addresses of the Parties set forth below, or at such otheraddress furnished in writing to the other Parties hereto.

(a) Ino the City:Director, Department of AviationThe City of Dallas8008 Cedar Springs Road, LB 16Dallas, Texas 75235-2852Attn: Daniel T. WeberFax: 214-670-6051

With copies to:The City Attorney's OfficeCity Hall, Room 7DN1500 Marilla StreetDallas, Texas 75201Attn: Robert L. SimsFax: 214-670-0622

(b) If to the LFAMC:Love Field Airport Modernization Corporationc/o The City ofDallasCity Hall, Room 5FN1500 Marilla Street

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EXHIBIT C

Dallas, Texas 75201Attn: David CookFax: 214-670-3543

With copies to:The City Attorney's OfficeCity Hall, Room 7DN1500 Marilla StreetDallas, Texas 75201Attn: Robert L. SimsFax: 214-670-0622

(c) If to Southwest:Southwest Airlines Co.P.O. Box 36611 HDQ-4PF2702 Love Field DriveDallas, Texas 75235Attn: Bob MontgomeryFax: 214-792-4086

With copies to:Southwest Airlines Co.P.O. Box 36611 HDQ-4PF2702 Love Field DriveDallas, Texas 75235Attn: Michael AuBuchonFax: 214-792-6200

Winstead PC5400 Renaissance Tower1201 Elm StreetDallas, Texas 75270Attn: Barry R. KnightFax: 214-745-5390

Section 6.8. Legal Construction. In case anyone or more of the provisions containedin this Agreement shall for any reason be held to be invalid, illegal or unenforceable in anyrespect, such invalidity, illegality, or unenforceability shall not affect any other provision thereofand in lieu of each provision that is found to be illegal, invalid or unenforceable, a provisionshall be added which is legal, valid and enforceable and is as similar in terms as possible to theprovision found to be illegal, invalid or unenforceable. Any termination of the original documentfrom which a defined tenn or provisions thereof incorporated by reference herein shall not affectthe defined term or incorporated reference's use herein.

Section 6.9. Entire Agreement. This Agreement and all the documents, agreements,exhibits and schedules referenced herein constitute the entire understanding and agreement of the

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EXHIBIT C

Parties and supersede any prior or contemporaneous, written or oral agreements, discussions,negotiations or previous agreements among the Parties with respect to the subject matter of thisAgreement. Except as expressly provided for in this Agreement, neither this Agreement nor anyterm hereof may be amended, waived, discharged, or terminated, except by written instrumentsigned by the Parties hereto.

Section 6.10. Waiver. No term or condition of this Agreement shall be deemed to havebeen waived, nor shall there be any estoppel to enforce any provision of this Agreement, exceptby written instrument of the Party charged with such waiver or estoppel.

Section 6.11. Consents and Approvals. Unless otherwise specifically provided herein,no consent or approval by the City or Southwest permitted or required under the terms of thisAgreement shall be valid or be of any validity whatsoever unless the same shall be in writing,signed by the Party by or on whose behalf such consent is given.

Section 6.12. Headings. The headings and captions of Articles and Sections herein arefor convenient reference only and shall not be deemed to limit, construe, affect, modify or alterthe meaning of such articles or sections of this Agreement.

Section 6.13. Contract for Goods and Services. This Agreement is a contract for goodsand services and is subject to Section 271.152 of the Texas Local Government Code, asamended. The Parties agree that the prevailing party in the adjudication of a claim under thisAgreement shall be entitled to recover its reasonable and necessary attorney's fees pursuant toSection 271.159 of the Texas Local Government Code, as amended.

Section 6.14. Counterparts. This Agreement may be executed in two or morecounterparts, each of which shall be deemed an original but all of which together shall constituteone and the same instrument.

Section 6.15. Notice of Contract Claim. This Agreement is subject to the provisions ofSection 2-86 of the Dallas City Code, as amended, relating to requirements for filing a notice ofa breach of contract claim against the City. Section 2-86 of the Dallas City Code, as amended, isexpressly incorporated by reference and made a part of this Agreement as if written word forword in this Agreement. Southwest is expected to fully comply with the requirements of thisordinance in the event of a claim, in addition to all other requirements in this Agreement relatedto claims and notice of claims.

Section 6.16. Reports and Audits. During the Term and for at least five (5) years afterthe LFAMC Bonds are no longer outstanding, Southwest shall maintain records to demonstrateproper expenditure of funds received by Southwest under the terms of this Agreement. Uponreasonable notice from the City, Southwest shall promptly make available to City such

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EXHIBIT C

information as the City reasonably requests with respect to the use of moneys received bySouthwest under this Agreement.

Section 6.17. Right of Review and Audit. (a) The City has the right to review and auditany and all of the services performed by Southwest under this Agreement, including financialrecords and operations of Southwest pertaining to the LFMP and the use of moneys received bySouthwest under this Agreement. Southwest agrees to retain all such records for a minimum offive (5) years after the Term of this Agreement.

(b) Southwest has the right to review and audit the records for any and all of the fundsand accounts maintained by the City under this Agreement.

Section 6.18. Exhibits. All exhibits and schedules referred to herein shall be considereda part of this Agreement as fully as if and with the same force and effect as if such exhibit orschedule had been included herein in full.

Section 6.19. Venue. Venue in any suit to enforce this Agreement shall be in a DistrictCourt ofDallas County, Texas.

Section 6.20. Priority of Legal Requirements and Agreement. If any of the provisionsof this Agreement shall be in conflict with any applicable Legal Requirements, including anyrules or regulations of the FAA or TSA, the provisions of such Legal Requirements shall control.If a conflict exists between the provisions of this Agreement, any of the agreements defined inthis Agreement or any other agreement concerning or affected by the LFMP, the order of priorityset forth in Article XIV of the Program Development Agreement shall govern which documentsshall control until completion of the LFMP, and thereafter the following documents shall controlin the following order of priority: (l) the Facilities Agreement; (2) the Revenue CreditAgreement; and (3) the Airport Use and Lease Agreement.

[SIGNATURE PAGES AND EXHIBITS TO FOLLOW]

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EXECUTED and effective as of the _ day of , 2010 ("Effective Date"), by theCity, signing by and through its City Manager, duly authorized to execute the same byResolution No. __ adopted by the City Council on , 2010, and by Southwest actingthrough its duly authorized officials.

CITY OF DALLAS, TEXASMARY K. SUHM,City Manager

By: _A.C. GonzalezAssistant City Manager

ATTEST:

By: ------Deborah WatkinsCity Secretary

APPROVED AS TO FORM:THOMAS P. PERKINS, JR.,City Attorney

By: _Robert L. SimsAssistant City Attorney

SOUTHWEST AIRLINES CO.:

Bob MontgomeryVice President - Properties

(CITY SEAL)

EXHIBIT C

EXHffiITA

REQUISITION FOR DISBURSEMENT FROM SOUTHWEST REIMBURSEMENT ACCOUNT

Requisition No. _

This requisition is submitted in accordance with the terms of that certain Revenue CreditAgreement, dated as of 1, 2010 (the "Revenue Credit Agreement"), between the CITY OFDALLAS, TEXAS, a Texas home rule municipality (the "City") and SOUTHWEST AIRLINES CO., aTexas corporation ("Southwest"). Terms capitalized but not defined in this Requisition shall have themeaning given to such terms in the Revenue Credit Agreement.

Southwest hereby requests a disbursement from the Southwest Reimbursement Accountestablished in accordance with the terms of the Revenue Credit Agreement. In accordance with theprovisions of Section 4.2 of the Revenue Credit Agreement, Southwest hereby certifies that:

1 Southwest will pay to the Trustee a Facilities Payment for the debt service coming due onthe LFAMC Bonds on , 20_ in the amount of $ _

2. The amount described in clause 1 above will be sufficient, together with other moneysheld by the Trustee for such purpose, to make the debt service payment in full due and owing on theLFAMC Bonds on ,20_.

3. In addition to the anticipated debt service amount due as set forth in Clause 1 above,Southwest has paid costs and expenses associated with Southwest Projects, the AFSP or the LFAMCBonds in the amount of $-----

4. The amount of Facilities Payments previously paid by Southwest to the Trustee that havenot been reimbursed from Available Revenues are $ _

5. The funds requested by this Requisition shall be accepted by Southwest solely for thepurposes described in Section 3.6 of the Revenue Credit Agreement.

SOUTHWEST AIRLINES CO.

Date: _

Date: _

By: -------------Title: ------------

ACKNOWLEDGMENT OF RECEWT

CITY OF DALLAS, TEXAS

By: _Title: -------------

EXHIBIT C

EXHffiITB

DESCRIPTION OF SOUTHWEST PROJECTS AND AFSP

COUNCIL CHAMBER

January 27, 2010

WHEREAS, Love Field Airport Modernization Corporation (the “Corporation”) was created under the auspices of the City of Dallas, Texas (the “City”); and,

WHEREAS, the City is the owner of Dallas Love Field (hereinafter defined and referred to as the “Airport”), which is located in the City of Dallas, Dallas County, Texas; and,

WHEREAS, on July 11, 2006, the City, the City of Fort Worth, The Dallas-Fort Worth International Airport Board, Southwest Airlines Co. (the “Company”) and American Airlines, Inc. entered into that certain “Contract Among The City of Dallas, The City of Fort Worth, Southwest Airlines Co., American Airlines, Inc., and DFW International Airport Board Incorporating the Substance of the Terms of the June 15, 2006, Joint Statement Between the Parties to Resolve the ‘Wright Amendment’ Issues affecting Dallas Love Field” (the “Five Party Agreement”) wherein, among other things, the parties thereto agreed to seek to eliminate restrictions on air service at the Airport set forth in existing federal legislation (commonly referred to as the “Wright Amendment”); and,

WHEREAS, on October 13, 2006, Public Law 109-352, commonly known as the “Wright Amendment Reform Act of 2006” was signed into law; and,

WHEREAS, the Wright Amendment Reform Act of 2006 provides that the interstate flight restrictions imposed on the Airport since 1979 will be lifted on October 13, 2014, in accordance with other terms and conditions set forth in the Wright Amendment Reform Act of 2006; and,

WHEREAS, in the Five Party Agreement, the City and the Company agreed to the significant redevelopment of portions of the Airport, including the modernization of the existing terminal facilities at the Airport, a program referred to as the “Love Field Modernization Program” or “LFMP”, and the City and the Company agreed to work toward completion of the LFMP by October 2014, eight (8) years from the enactment of the Wright Amendment Reform Act of 2006; and,

WHEREAS, following enactments of the Wright Amendment Reform Act of 2006, the City retained consultants to perform a terminal area master plan, a plan referred to as the “Terminal Area Redevelopment Program Study” or “TARPS”, establishing the requirements and criteria for terminal expansion and modernization and, in a parallel effort, the Company retained consultants to explore alternative conceptual layouts for terminal redevelopment, including the alternative conceptual layout that has been identified by City and the Company as “Option C”; and,

COUNCIL CHAMBER

January 27, 2010

WHEREAS, on June 25, 2008, by Resolution No. 08-1877, the Dallas City Council approved a “Term Sheet” negotiated by the City and the Company in which the consultant recommendations were adopted, establishing the consensus recommendation that Option C is the preferred concept for the LFMP and will satisfy the requirements defined in the TARPS; and,

WHEREAS, to facilitate the development of the LFMP, the City created the Corporation to act on behalf of the City in the performance of its governmental functions to promote the development of the geographic area of the City included at or in the vicinity of the Airport, in furtherance of the promotion, development, encouragement, and maintenance of employment, commerce, aviation activity, tourism and economic development in the City; and,

WHEREAS, in furtherance of the development of the LFMP, the City, the Corporation and the Company entered into that certain Program Development Agreement, dated January 15, 2009 (the “Program Development Agreement”); and,

WHEREAS, in furtherance of the provisions of the Five Party Agreement, the City and the Company entered into that certain Amended and Restated Lease of Terminal Building Premises, effective October 1, 2008 (the “Airport Use and Lease Agreement”); and,

WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the City and the Company are undertaking the LFMP, a major capital program to improve and modernize terminal facilities at the Airport; and,

WHEREAS, each of the Program Development Agreement and the Airport Use and Lease Agreement provide that the Corporation, at the request of the Company, shall issue bonds to finance elements of the LFMP; and,

WHEREAS, it is deemed necessary and advisable that this Resolution be adopted;

Now, Therefore,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DALLAS:

COUNCIL CHAMBER

January 27, 2010

Section 1. The Special Facilities Agreement (the "Facilities Agreement") by and among the Corporation, the City and the Company, in substantially the form and substance as attached to this Resolution and made a part hereof for all purposes, is hereby approved, and the City approves the issuance of special facilities revenue bonds, in one or more series (the "Bonds") by the Corporation in the principal amount not to exceed $500,000,000, subject to the following parameters: the net effective interest rate on the Bonds of any series shall not exceed 8.00% and the term of the Bonds shall not exceed 30 years from their date of issuance. The proceeds of the Bonds shall be used in connection with acquiring and constructing or causing to be acquired and constructed the elements of the LFMP defined in the Facilities Agreement as the Project. The City Council hereby approves the execution of the Facilities Agreement, and authorizes the City Manager or her designee to execute and deliver the Facilities Agreement on behalf of the City, and that the City Secretary is hereby authorized to attest and affix the seal of the City to the Facilities Agreement. The issuance of the Bonds for the purposes described in the Facilities Agreement is approved, and constitutes a public purpose under the laws of the State of Texas.

Section 2. The resolution to be adopted by the Corporation in substantially the form and substance as attached to this Resolution authorizing the execution of the Facilities Agreement, the Bond Purchase Agreement by and between the Corporation and the underwriters named therein, and the Trust Indenture by and between the Corporation and Wells Fargo Bank, National Association, and the sale of the Bonds and the use of an Official Statement in connection with the sale of the Bonds is hereby specifically approved, and the Bonds may be issued as provided for therein. The Corporation is hereby authorized to execute each of the aforementioned agreements.

Section 3. The Revenue Credit Agreement (the "Revenue Credit Agreement") by and between the City and the Company, in substantially the form and substance as attached to this Resolution and made a part hereof for all purposes, is hereby approved. The City Council hereby approves the execution of the Revenue Credit Agreement, and authorizes the City Manager or her designee to execute and deliver the Revenue Credit Agreement on behalf of the City, and that the City Secretary is hereby authorized to attest and affix the seal of the City to the Revenue Credit Agreement.

COUNCIL CHAMBER

January 27, 2010

Section 4. The selection of First Southwest Company and Estrada Hinojosa & Company as co-Financial Advisor to the Corporation, and the selection of McCall, Parkhurst & Horton L.L.P and Escamilla & Poneck, Inc. as co-Bond Counsel to the Corporation is hereby affirmed. The selection of Goldman, Sachs & Co., Bank of America Merrill Lynch, Samuel A. Ramirez & Co., Inc., Citi, and Comerica Bank as underwriters for the Bonds is hereby approved.

ADOPTED THIS ___ DAY OF _____________, 2010.

APPROVED AS TO FORM:Thomas P. Perkins, Jr., City Attorney

_______________________________

ADDENDUM ITEM # 2KEY FOCUS AREA: Public Safety Improvements and Crime Reduction


COUNCIL DISTRICT(S): All

DEPARTMENT: Business Development & Procurement ServicesCommunication and Information ServicesFirePoliceCourt & Detention Services

CMO: Dave Cook, 670-7804Ryan S. Evans, 670-3314

MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize (1) an acquisition contract for the purchase and implementation of software and hardware for a records management system for Police, Court & Detention Services and Dallas-Fire Rescue to replace the legacy mainframe system in the amount of $4,910,627; and (2) a five-year service contract for maintenance and support for a records management system in the amount of $2,484,902 - Unisys Corporation, most advantageous proposer of five - Total not to exceed $7,395,529 - Financing: CurrentFunds ($3,153,903) (subject to annual appropriations), Urban Area Security Initiative Grant Funds ($3,602,385) and 2008 Equipment Acquisition Contractual Obligation Notes ($639,241)

BACKGROUND

This acquisition contract will provide for the purchase and implementation of a replacement records management systems (RMS) for Police, Courts & Detention Services (CDS), and Dallas-Fire Rescue (DFR) Department’s legacy systems. This agreement will also provide five years of maintenance and support of the new RMS. Maintenance includes patches, updates, compliance with any new state or federal requirements, technical and customer service support. The current RMS system consist of two mainframe systems, Direct Entry Field Reporting System (DEFRS) and Direct Entry Arrest Reporting System (DEARS), and also the National Fire Incident Reporting (NFIRS) and the Fire Inspection systems.



The current legacy mainframe system is over 20 years old and runs on an obsolete IBM mainframe computer that has exceeded it's useful life; maintenance on this hardware will no longer be available after March 2011. The system runs on a proprietary operating system using an application written in an older language. The operating system, LINC, has no external support; the application has proved to be difficult to maintain and is not able to be enhanced or modified to meet changing operational requirements. Current state and federal standards which promote data interoperability and information sharing are not supported by any of the systems being replaced.

The initial phase of implementation will provide the necessary components to replace the existing mainframe system for Police, CDS, and DFR. Some examples of improved capabilities the new RMS system will provide are:

Global search functions for names, addresses, vehiclesProvide reliable interfaces with current external programsAutomated state and federal reporting requirementsEnhanced ability to enter data from the fieldSingle source of information for enhanced and efficient reportingImproved accuracy and consistency of data enteredImproved efficiency in data analysis and processing

City departments involved in law enforcement include Dallas Police Department, CDS, and DFR Fire Investigation/Explosive Ordinance (Arson). These departments record over 1 million offenses and over 60,000 arrests each year. These offenses, arrests and follow up supplemental reports are recorded in the legacy mainframe system. From these records, state and federally required crime statistics are calculated and reported. These records are maintained for at least 10 years after the case is closed.

DFR is required by federal law to report detailed information on all fire incidents. This report is submitted to the State of Texas in the National Fire Incident Reporting System (NFIRS) protocol; the State consolidates all reports and submits to the federal government. Compliance with these reporting requirements impacts on-going receipt of state and federal grants. DFR responds to approximately 117,500 fire related incidents per year.

Additionally, DFR is required to inspect businesses for compliance with City ordinance and state law. There are 50,000 businesses that are subject to this recurring inspection. Currently scheduling, tracking, and reporting of inspections are done by an in-house developed stand-alone application. The Inspection module of the new RMS system will meet the requirements of DFR and will be integrated with NFIRS and other, future modules.



Subsequent phases will be initiated when funding is appropriated. Such phases will include the implementation of other components such as electronic case filing, offender reporting, Amber alerts, integration with internal affairs and public integrity, tactical information, hazardous materials, pre-plans, hydrant inspections, staffing, etc.

An eight member committee from the following departments reviewed and evaluated the proposals:

Dallas Fire-Rescue Department (2)Dallas Police Department (2)City Marshall Department (1)Communication and Information Services (1)Business Development & Procurement Services (2)*

*Business Development and Procurement Services only evaluated the Business Inclusion and Development Plan and cost.

The successful proposer was selected by the committee on the basis of demonstrated competence and qualifications under the following criteria:

Cost 15%Capability, Credibility and expertise of the Proposer 15%Functional Match to City Requirements 25%Technical Match to City Requirements 30%Business Inclusion & Development 15%

As part of the solicitation process and in an effort to increase competition, Business Development and Procurement Services (BDPS) used its procurement system to send out 706 email bid notifications to vendors registered under respective commodities. To further increase competition, BDPS uses historical solicitation information, the internet, and vendor contact information obtained from user departments to contact additional vendors by phone. Additionally, in an effort to secure more bids, notifications were sent by the BDPS’ ResourceLINK Team (RLT) to 25 chambers of commerce, the DFW Minority Business Council and the Women’s Business Council – Southwest, to ensure maximum vendor outreach.

PRIOR ACTION/REVIEW (COUNCIL BOARDS, COMMISSIONS)

On January 19, 2010, Public Safety Committee was briefed by memorandum.


FISCAL INFORMATION

$ 694,001.00 – Current funds$2,459,902.00 – Current Funds (subject to annual appropriation) $3,602,385.20 - Urban Area Security Initiative Grant Funds$ 639,240.80 – 2008 Equipment Acquisition Contractual Obligation Notes

M/WBE INFORMATION

137 - Vendors contacted137 - No response 0 - Response (Bid) 0 - Response (No bid) 0 - Successful

706 M/WBE and Non-M/WBE vendors were contacted

The recommended awardee has fulfilled the requirements set forth in the Business Inclusion and Development (BID) Plan adopted by Council Resolution No. 08-2826 as amended.

ETHNIC COMPOSITION

Unisys Corporation

White Female 64 White Male 196Black Female 14 Black Male 42Hispanic Female 24 Hispanic Male 73Other Female 2 Other Male 20

BID INFORMATION

The following proposals were received from solicitation number BUZ0904 and were opened on April 2, 2009. This service contract is being awarded in its entirety to the most advantageous proposer.

*Denotes successful proposer

Bidders Address Score Amount of Bid

*Unisys 5700 Mopac Expwy. 84.1 $7,395,529.00 Corporation Austin, TX 78749

Indico 2510 Parkview Dr. 77.9 $5,673,927.00Suite 315Dallas, TX 75227

Note – the above vendor scores and pricing are based on fully negotiated systems and pricing.


BID INFORMATION (Continued)

Vendor scores and pricing listed below are based on initial proposals and were not negotiated.

Bidders Address Score Amount of Bid

Tritech Software 15769 Stonebridge Dr. 70.8 $10,541,715.00Frisco, TX 75035

Tiburon, Inc. 6200 Stoneridge Mall Rd. 54.9 $19,122,166.00Suite 400Pleasanton, CA 94588

DocuNav Solutions 5048 Tennyson Pkwy. Non-Responsive**Suite 110Plano, TX 75024

**DocNav Solutions was deemed non-responsive due to not meeting bid specifications.

OWNER

Unisys Corporation

J. Edward Coleman, PresidentNancy Sundheim, SecretaryScott Battersby, Treasurer

BUSINESS INCLUSION AND DEVELOPMENT PLAN SUMMARY

PROJECT: Authorize (1) an acquisition contract for the purchase and implementation of software and hardware for a records management system for Police, Court & Detention Services and Dallas-Fire Rescue to replace the legacy mainframe system in the amount of $4,910,627; and (2) a five-year service contract for maintenance and support for a records management system in the amount of $2,484,902 - Unisys Corporation, most advantageous proposer of five – Total not to exceed $7,395,529 - Financing: Current Funds ($3,153,903) (subject to annual appropriations), Urban Area Security Initiative Grant Funds ($3,602,385), 2008 Equipment Acquisition Contractual Obligation Notes ($639,241)

Unisys Corporation is a non-local, non-minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use the following sub-contractors.PROJECT CATEGORY: Other Services

_______________________________________________________________

LOCAL/NON-LOCAL CONTRACT SUMMARY

Amount Percent

Total local contracts $1,207,497.00 16.33%Total non-local contracts $6,188,032.00 83.67%

------------------------ ------------------------

TOTAL CONTRACT $7,395,529.00 100.00%

LOCAL/NON-LOCAL M/WBE PARTICIPATION

Local Contractors / Sub-Contractors

Local Certification Amount Percent

Qnet Information ServicesVignon Corporation

BMMB43814Y0111WFDB42907Y1010

$40,000.00$1,167,497.00

3.31%96.69%

------------------------ ------------------------

Total Minority - Local $1,207,497.00 100.00%

Non-Local Contractors / Sub-Contractors

None

TOTAL M/WBE CONTRACT PARTICIPATION

Local Percent Local & Non-Local Percent

African American $40,000.00 3.31% $40,000.00 0.54%Hispanic American $0.00 0.00% $0.00 0.00%Asian American $0.00 0.00% $0.00 0.00%Native American $0.00 0.00% $0.00 0.00%WBE $1,167,497.00 96.69% $1,167,497.00 15.79%

---------------------- ---------------------- ---------------------- -----------------------

Total $1,207,497.00 100.00% $1,207,497.00 16.33%

COUNCIL CHAMBER

January 27, 2010


Section 1. That the City Manager is authorized to execute (1) an acquisition contract for the purchase and implementation of software and hardware for a records management system for Police, Court & Detention Services and Dallas-Fire Rescue to replace the legacy mainframe system in the amount of $4,910,627.00, and (2) a five-year service contract for maintenance and support for the records management system in the amount of $2,484,902.00 with Unisys Corporation (VS0000041856) in a total amount not exceed $7,395,529.00, upon approval as to form by the City Attorney. If the service was bid or proposed on an as needed, unit price basis for performance of specified tasks, payment to Unisys Corporation shall be based only on the amount of the services directed to be performed by the City and properly performed by Unisys Corporation under the contract.

Section 2. That the City Controller is authorized to disburse funds from the following appropriation in an amount not to exceed $7,395,529.00 (subject to annual appropriations):

FUND DEPT UNIT OBJECT ENCUMBRANCE AMOUNT

F194 CMO 3280 4735 CTDSV10UNISYS $ 671,025.23 F229 CMO 1091 3070 CTDSV10UNISYS $2,153,589.20 F229 CMO 1091 4731 CTDSV10UNISYS $ 287,188.00 F229 CMO 1091 4735 CTDSV10UNISYS $ 490,582.77 0600 DSV E297 3070 CTDSV10UNISYS $ 517,204.80 0600 DSV E297 4735 CTDSV10UNISYS $ 122,036.00 0198 DSV 1665 3070 CTDSV10UNISYS $ 121,774.00 0198 DSV 1665 4731 CTDSV10UNISYS $ 91,734.000198 DSV 1665 4735 CTDSV10UNISYS $ 455,493.00 0198 DSV 1665 3438 CTDSV10UNISYS $ 25,000.00 0198 DSV 1675 3438 CTDSV11UNISYS $ 501,255.00 0198 DSV 1677 3438 CTDSV11UNISYS $ 210,686.00 0198 DSV 1675 3438 CTDSV12UNISYS $ 343,688.00 0198 DSV 1677 3438 CTDSV12UNISYS $ 201,660.00 0198 DSV 1675 3438 CTDSV13UNISYS $ 367,793.00 0198 DSV 1677 3438 CTDSV13UNISYS $ 231,766.00 0198 DSV 1675 3438 CTDSV14UNISYS $ 381,177.00 0198 DSV 1677 3438 CTDSV14UNISYS $ 221,877.00

COUNCIL CHAMBER

January 27, 2010

Section 3. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Dallas and it is accordingly resolved.

DISTRIBUTION:

Business Development and Procurement Services, 3FNCommunication and Information ServicesCourt & Detention ServicesFirePolice

ADDENDUM ITEM # 3KEY FOCUS AREA: Efficient, Effective, Economical


COUNCIL DISTRICT(S): N/A

DEPARTMENT: City Controller

CMO: Dave Cook, 670-7804

MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize the preparation of plans for the issuance of the Combination Tax and Revenue Certificates of Obligation, Series 2010 in an amount not to exceed $23,000,000; and enacting other provisions in connection therewith - Financing: No cost consideration to the City

BACKGROUND

The issuance of approximately $21,000,000 in Equipment Acquisition Notes was included in the FY 2009-10 capital budget. As a cost savings measure, the sale of equipment notes has been combined with the previously authorized $2,000,000 Certificates of Obligation sale. The total of the two combined bond sales will not exceed $23,000,000. The uses of the funds include the construction of a sub-police station and related facilities in the Bexar Street Redevelopment Corridor; fire apparatus replacement, technology improvements and fleet replacement for the sanitation, street services and equipment services departments.

The City plans to use Underwriting Syndicate Team "A" which is comprised of Banc of America Securities LLC, Ramirez & Co. Inc., Citigroup, J.P. Morgan Chase, Morgan Keegan & Co. Inc., and Rice Financial. Banc of America will be the Book Running Senior Manager and Ramirez & Co. will be the Co-Senior Manager.

City Council authorization is required to begin preparations for the sale on or about March 10, 2010.

ESTIMATED SCHEDULE OF PROJECT

Authorize preparation for issuance of certificates of obligation January 27, 20101st publication of notice of intention to issue certificates of obligation January 28, 20102nd publication of notice of intention to issue certificates of obligation February 4, 2010Approval of parameters ordinance March 3, 2010Pricing March 9, 2010Execution of the Bond Purchase Agreement March 10, 2010Delivery of Proceeds April 1, 2010


PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS)

City Council was briefed on January 20th regarding the March 2010 bond sale.

FISCAL INFORMATION

See Attachment 1

M/WBE INFORMATION

Attachment 1 provides an estimate of issuance costs for proposed Series 2010 Certificates of Obligation and the M/WBE participation.

Cost Percent

Co-Bond CounselVinson and Elkins L.L.P. (Vendor #341246) $17,000 19.0%West & Associates L.L.P. (Vendor #330805)* 10,059 11.3%

Co-Financial AdvisorsFirst Southwest Company (Vendor #193056) 19,800 22.1%Estrada Hinojosa (Vendor #259910)* 13,200 14.8%

Out-of-Pocket ExpensesFirst Southwest Company (Vendor #193056) 1,840 2.1%

Official Statement TypingFirst Southwest Company (Vendor #193056) 184 0.3%

ATTACHMENT 1

$23,000,000Combination Tax and Revenue Certificates of Obligation, Series 2010

Estimate of Total Issuance Costs and M/WBE Participation

First Southwest Company (Vendor #193056) 184 0.3%

Official Statement PrintingTBD 1,227 1.4%

Rating AgenciesMoody's Investors Service (Vendor #951236) 8,449 9.5%Standard & Poor's (Vendor #954974) 5,765 6.5%

Legal NoticeDallas Morning News (Vendor #028774) 1,000 1.1%

AuditorGrant Thornton L.L.P. (Vendor #VS0000007921) 1,165 1.4% Filing FeeAttorney General (Vendor #344989) 9,500 10.7% Total Issuance Costs 89,189$ 100.0%

*Total M/WBE Participation as % of Total Issuance Costs: 26.1%

Co-Bond CounselVinson and Elkins L.L.P. - (Vendor #341246) $192,000 30.0%West & Associates L.L.P. - (Vendor #330805)* 82,000 12.8% Co-Financial Advisors First Southwest Company - (Vendor #193056) 92,220 14.4%Estrada Hinojosa - (Vendor #259910)* 61,480 9.6%

Out-of-Pocket Expenses First Southwest Company (Vendor #193056) 15,000 2.3%

Official Statement Typing First Southwest Company (Vendor #193056) 1,500 0.2%

Restructuring FeeFirst Southwest Company (Vendor #193056) 32,000 5.0%Estrada Hinojosa - (Vendor #259910)* 8,000 1.3%

Official Statement Printing TBD 10,000 1.6%

Rating Agencies Moody's Investors Service (Vendor #951236) 68,880 10.8%Standard & Poor's (Vendor #954974) 47,000 7.3%


Auditor Grant Thornton L.L.P. (Vendor # 0000007921) 9,500 1.5% Filing FeeAttorney General (Vendor #344989) 19,000 3.0%

Total Issuance Costs 639,580$ 100%


$187,500,000Total Obligations

Estimate of Total Bond Issuance Costs and M/WBE Participation

ATTACHMENT 1

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the City will issue the proposed Combination Tax and Revenue Certificates of Obligation pursuant to the authority granted by Subchapter C of Chapter 271, Texas Local Government Code (the “Certificate of Obligation Act of 1971”), as amended; and

WHEREAS, the adopted capital improvement program currently underway and/or scheduled requires issuance of an amount not to exceed $23,000,000 certificates of obligation for various capital purposes; and

WHEREAS, it is desired to proceed with the preparatory work necessary to issue obligations through a negotiated sale on or about March 10, 2008. Now, Therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DALLAS:

Section 1. That the City Manager be and is hereby authorized to proceed with the necessary preparations for the sale of an amount not to exceed $23,000,000 Combination Tax and Revenue Certificates of Obligation, Series 2010 with such sale to occur on or about March 10, 2010.

Section 2. That the City Manager, the City's Co-Financial Advisors, and the City's Co-Bond Counsel are hereby authorized and directed to prepare an Official Statement with respect to such obligations and to take such other action and prepare such other documents as are necessary and incidental to the issuance, sale and delivery of the certificates of obligation.

Section 3. That the City Manager be and is hereby authorized to use the previously contracted professional services of First Southwest Company and Estrada Hinojosa & Company, Inc. as co-financial advisors for the proposed certificate of obligation sale. If certificates of obligation are issued, payment for the advisory services and out-of-pocket expenses of First Southwest Company (Vendor #193056) are estimated to be $21,824 and payment for the advisory services and out-of-pocket expenses of Estrada Hinojosa & Company, Inc. (Vendor #259910) are estimated to be $13,500 and shall be made from the interest earnings on the certificates of obligation proceeds.

Section 4. That the City Manager be and is hereby authorized to use the previously contracted professional services of Vinson & Elkins L.L.P. and West & Associates, P.C. as co-bond counsel in connection with the sale and delivery of the certificates of obligation. If certificates of obligation are issued, payment for the opinion of Vinson & Elkins L.L.P. (Vendor #341246) shall be at the rate of $0.30 per $1,000 increment of obligations issued plus an hourly rate of $90.00 to $300.00 for services rendered by individual attorneys and paralegals (estimated to be $17,000), and shall be made from the interest earnings on the certificates of obligation proceeds. If certificates of obligation are issued, payment for the opinion of West & Associates L.L.P., P.C. (Vendor #330805) shall be at the rate of $0.15 per $1,000 increment of obligations issued plus an hourly rate of $90.00 to $300.00 for services rendered by individual attorneys and paralegals (estimated to be $10,059), and shall be made from the interest earnings on the certificates of obligation proceeds.

COUNCIL CHAMBER

January 27, 2010

Section 5. That the City Manager be and is hereby authorized to obtain bond ratings from Moody's Investors Service (Vendor #951236) and from Standard & Poor's, Inc. (Vendor #954974) in connection with the sale of the obligations. If the certificates of obligation are issued, payment for the bond ratings are estimated to be $14,215 and shall be made from the interest earnings on the certificates of obligation proceeds.

Section 6. That the City Manager be and is hereby authorized to use the previously contracted professional services of Grant Thornton L.L.P. to obtain an independent auditor's consent letter in connection with the sale and delivery of the obligations. If certificates of obligation are issued, payment for the services of Grant Thornton L.L.P. (Vendor #VS0000007921) are estimated to be $1,165 and shall be made from the interest earnings on the certificates of obligation proceeds.

Section 7. That the City Manager be and is hereby authorized to make payments for printing services to print and mail official statements. If bonds are issued, payment for the printing services is estimated to be $1,227 and shall be made from the interest earnings on the certificates of obligation proceeds.

Section 8. That the City Controller be and is hereby authorized to make payment to U.S. Bank National Association for services provided as paying agent/registrar with respect to the obligations at an annual cost of $200 plus mailing expenses from the General Fund 0001, Department BMS, Unit 1125, Object 3537, (Vendor # 355655) if the certificates of obligation are issued.

Section 9. That the proceeds received from the certificates of obligation sale shall be deposited not to exceed $2,000,000 in Fund 0628 Unit P594 and not to exceed $21,000,000 in Fund 0629 Unit P595 established for the purposes as set forth in Exhibit "A" hereto. Any accrued interest from these proceeds will be deposited in the Debt Service Fund 0981, Department BMS, Revenue Source 8438.

Section 10. That the Chief Financial Officer of the City of Dallas is hereby authorized and directed to issue a Notice in substantially the form attached hereto as Exhibit “A”.

Section 11. That the attached Notice shall be published once a week for two consecutive weeks, the date of the first publication being before the thirtieth (30th) day prior to the date set forth in the Notice for passage of the ordinance authorizing such Certificates of Obligation. Such Notice shall be published in the Dallas Morning News.

Section 12. That the City Controller be and is hereby authorized to pay the Dallas Morning News (Vendor #028774) to publish the Notice. Payment for the services of the Dallas Morning News shall not exceed $1,000 and shall be made from Fund 0001, Department BMS, Unit 1125, Object 3320, Encumbrance Number CT SPRING10 DMN FEE.

COUNCIL CHAMBER

January 27, 2010

Section 13. That the City Manager is authorized and directed to file an Official Statement with respect to such bonds and prepare such other documents as are necessary and incidental to the issuance, sale and delivery of the bonds with the Attorney General; and that the City Controller be and is hereby authorized to make the payment for filing with the Attorney General’s office prior to receiving the Bond Proceeds (no later than February 24, 2010). The cost is estimated to be $9,500 and shall be made from the General Fund 0001, Department BMS, Unit 1125, Object 3537, Encumbrance Number CT SPRING10 AG FEE, (Vendor #344989) and shall be reimbursed with proceeds. Section 14. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Dallas and it is accordingly so resolved.

DISTRIBUTION: CITY CONTROLLERS OFFICE, 4FS

EXHIBIT A

NOTICE OF INTENTION TO ISSUE CITY OF DALLAS, TEXAS COMBINATION TAX AND REVENUE CERTIFICATES OF OBLIGATION, SERIES 2010

NOTICE IS HEREBY GIVEN that on March 3, 2010, the City Council of the City of Dallas, Texas, at 9:00 a.m. at a regular meeting of the City Council to be held in the City Council Chambers, City Hall, 1500 Marilla Street, Dallas, Texas, the regular meeting place of the City Council, intends to pass an ordinance authorizing the issuance of not to exceed $23,000,000 principal amount of certificates of obligation for the purpose of paying contractual obligations to be incurred for the following purposes, to wit: (i) planning, designing, purchasing, constructing, equipping, and furnishing a neighborhood police station and related facilities, including a community meeting area, to be located in South Dallas in the Bexar Street Redevelopment Corridor; (ii) the acquisition of vehicles (fleet replacement) for various city departments and equipment for the City’s Fire and Sanitation Departments; (iii) the acquisition of hardware and software and related installation and implementation to automate the creation of certain traffic citations; (iv) the acquisition of hardware and software and related installation and implementation in connection with the City’s network infrastructure upgrade (collectively with items (i), (ii) and (iii), the “Project”) and (v) paying for professional services of attorneys, financial advisors and other professionals in connection with the Project and the issuance of the Certificates. The Certificates shall bear interest at a rate not to exceed fifteen percent (15%) per annum and shall have a maximum maturity date of not later than ten (10) years after their date. Said Certificates shall be payable from the levy of a direct and continuing ad valorem tax, levied within the limits prescribed by law, against all taxable property within the City sufficient to pay the interest on this series of Certificates as due and to provide for the payment of the principal thereof as the same matures, as authorized by Subchapter C, Chapter 271, Texas Local Government Code, as amended, and from all or a part of the surplus revenues of the City’s Municipal Drainage Utility System, such pledge of surplus revenues being limited to $1,000.

THIS NOTICE is given in accordance with law and as directed by the City Council of the City of Dallas, Texas.

GIVEN THIS January 27, 2010.

By: /s/ David Cook Chief Financial Officer

ADDENDUM ITEM # 4KEY FOCUS AREA: Efficient, Effective and Economical



DEPARTMENT: City Controller


MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize the preparation of plans for the issuance of General Obligation Refunding and Improvement Bonds, Series 2010 in an amount not to exceed $164,500,000 - Financing: No cost consideration to the City

BACKGROUND

On May 2, 1998 voters approved a $543,500,000 Bond Program and on November 7, 2006 voters approved a $1,353,520,000 Bond Program. The adopted FY 2009-10 capital budget assumed the issuance of $354,775,000 in bonds from both programs. A thorough review of projects has been conducted. $128,880,000 is the recommended issuance amount for projects approved in the 1998 and 2006 Bond Programs. $5,700,000 from the 1998 Bond Program and $123,180,000 from the 2006 Bond Program will be issued in bonds.

Approximately $35,620,000 of the proceeds from the issue will be used to refund outstanding general obligation debt. Due to the current conditions in the bond market, some of the refunding proceeds will be used for advance refunding of obligations. The City's co-financial advisors, First Southwest Company and Estrada Hinojosa, recommend a current refunding of the remaining Series 1996 and 2000 obligations and an advance refunding of the remaining Series 2001 obligation. Based on recent market conditions, the refunding is expected to result in cash savings of $3,075,242 and a net present value savings of $2,191,805 which is 5.553 percent of the par of the refunded bonds. Actual savings will depend on market conditions at the time of the sale. If interest rate conditions result in a significant deterioration in the current projected savings, the City may elect, as little as one day prior to the sale date, to cancel this portion of the sale. If market conditions improve, the City may elect to look for additional refunding opportunities and adjust the terms of the sale to include other advance refundings of outstanding obligations.



The City plans to use Underwriting Syndicate Team "A" which is comprised of Banc of America Securities LLC, Ramirez & Co. Inc., Citigroup, J.P. Morgan Chase, Morgan Keegan & Co. Inc., and Rice Financial. Banc of America will be the Book Running Senior Manager and Ramirez & Co. will be the Co-Senior Manager.

City Council authorization is required to begin preparations for the sale of these general obligation bonds on or about March 10, 2010.


Authorize preparation for issuance of bonds January 27, 2010Approval of parameters ordinance March 3, 2010Pricing March 9, 2010Execution of the Bond Purchase Agreement March 10, 2010Delivery of Proceeds April 1, 2010


City Council was briefed on January 20th regarding the March 2010 bond sale.

FISCAL INFORMATION

See Attachment 1

M/WBE INFORMATION

Attachment 1 provides an estimate of bond issuance costs for proposed Series 2010 bonds and the M/WBE participation.

Cost Percent

Co-Bond CounselVinson and Elkins L.L.P. (Vendor #341246) $175,000 31.8%West & Associates L.L.P. (Vendor #330805)* 71,941 13.1%

Co-Financial AdvisorsFirst Southwest Company (Vendor #193056) 72,420 13.3%Estrada Hinojosa (Vendor #259910)* 48,280 8.8%

Out-of-Pocket ExpensesFirst Southwest Company (Vendor #193056) 13,160 2.4%

Official Statement TypingFirst Southwest Company (Vendor #193056) 1,317 0.2%

ATTACHMENT 1

$164,500,000General Obligation Bonds, Series 2010


Restructuring FeeFirst Southwest Company (Vendor #193056) 32,000 5.8%Estrada Hinojosa (Vendor #259910)* 8,000 1.5%

Official Statement PrintingTBD 8,773 1.6%

Rating AgenciesMoody's Investors Service (Vendor #951236) 60,431 11.0%Standard & Poor's (Vendor #954974) 41,235 7.5%

AuditorGrant Thornton L.L.P. (Vendor #VS0000007921) 8,335 1.4% Filing FeeAttorney General (Vendor #344989) 9,500 1.7% Total Issuance Costs 550,393$ 100.0%


Co-Bond CounselVinson and Elkins L.L.P. - (Vendor #341246) $192,000 30.0%West & Associates L.L.P. - (Vendor #330805)* 82,000 12.8% Co-Financial Advisors First Southwest Company - (Vendor #193056) 92,220 14.4%Estrada Hinojosa - (Vendor #259910)* 61,480 9.6%

Out-of-Pocket Expenses First Southwest Company (Vendor #193056) 15,000 2.3%

Official Statement Typing First Southwest Company (Vendor #193056) 1,500 0.2%

Restructuring FeeFirst Southwest Company (Vendor #193056) 32,000 5.0%Estrada Hinojosa - (Vendor #259910)* 8,000 1.3%

Official Statement Printing TBD 10,000 1.6%

Rating Agencies Moody's Investors Service (Vendor #951236) 68,880 10.8%Standard & Poor's (Vendor #954974) 47,000 7.3%


Auditor Grant Thornton L.L.P. (Vendor # 0000007921) 9,500 1.5% Filing FeeAttorney General (Vendor #344989) 19,000 3.0%

Total Issuance Costs 639,580$ 100%


$187,500,000Total Obligations


ATTACHMENT 1

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the adopted capital improvement programs currently underway and/or scheduled requires issuance of $128,880,000 of voter approved general obligation bonds for various capital purposes; and

WHEREAS, the issuance of $128,880,000 general obligation bonds from the reviewed projects approved in the May 2, 1998 and November 7, 2006 bond programs; and

WHEREAS, the issuance of $35,620,000 to refund cost beneficial outstanding general obligation bonds; and

WHEREAS, it is desired to proceed with the preparatory work necessary to issue bonds through a negotiated sale on or about March 10, 2010.

Now, Therefore,


Section 1. That the City Manager be and is hereby authorized to proceed with the necessary preparations for the sale of an amount not to exceed $164,500,000 General Obligation Refunding and Improvement Bonds, Series 2010, with such sale to occur on or about March 10, 2010.

Section 2. That the City Manager, the City's Co-Financial Advisors, and the City's Co-Bond Counsel are hereby authorized and directed to prepare an Official Statement with respect to such bonds and to take such other action and prepare such other documents as are necessary and incidental to the issuance, sale and delivery of the bonds.

Section 3. That the City Manager be and is hereby authorized to use the previously contracted professional services of First Southwest Company and Estrada Hinojosa & Company, Inc. as co-financial advisors for the proposed bond sale. If the bonds are issued, payment for the advisory services and out-of-pocket expenses of First Southwest Company (Vendor #193056) are estimated to be $118,897 and payment for the advisory services and out-of-pocket expenses of Estrada Hinojosa & Company, Inc. (Vendor #259910) are estimated to be $56,280 and shall be made from the interest earnings on the bond proceeds.

COUNCIL CHAMBER

January 27, 2010

Section 4. That the City Manager be and is hereby authorized to use the previously contracted professional services of Vinson & Elkins L.L.P. and West & Associates, L.L.P. P.C. as co-bond counsel in connection with the sale and delivery of the bonds. If the bonds are issued, payment for the opinion of Vinson & Elkins L.L.P. (Vendor #341246) shall be at the rate of $0.30 per $1,000 increment of bonds issued plus an hourly rate of $90.00 to $300.00 for services rendered by individual attorneys and paralegals (estimated to be $175,000), and shall be made from the interest earnings on the bond proceeds. If the bonds are issued, payment for the opinion of West & Associates L.L.P., P.C. (Vendor #330805) shall be at the rate of $0.15 per $1,000 increment of bonds issued plus an hourly rate of $90.00 to $300.00 for services rendered by individual attorneys and paralegals (estimated to be $71,941), and shall be made from the interest earnings on the bond proceeds.

Section 5. That the City Manager be and is hereby authorized to obtain bond ratings from Moody's Investors Service (Vendor #951236) and from Standard & Poor's, Inc. (Vendor #954974) in connection with the sale of the bonds. If the bonds are issued, payment for the bond ratings are estimated to be $101,665 and shall be made from the interest earnings on the bond proceeds.

Section 6. That the City Manager be and is hereby authorized to use the previously contracted professional services of Grant Thornton L.L.P. to obtain an independent auditor's consent letter in connection with the sale and delivery of the bonds. If the bonds are issued, payment for the services of Grant Thornton L.L.P. (Vendor #VS0000007921) are estimated to be $8,335 and shall be made from the interest earnings on the bond proceeds.

Section 7. That the City Manager be and is hereby authorized to make payments for printing services to print and mail official statements. If bonds are issues, payment for the printing services is estimated to be $8,773 and shall be made from the interest earnings on the bond proceeds.

Section 8. That the City Controller be and is hereby authorized to make payment to U.S. Bank National Association for services provided as paying agent/registrar with respect to the bonds at an annual cost of $200 plus mailing expenses from the General Fund 0001, Department BMS, Unit 1125, Object 3537, (Vendor #355655) if the bonds are issued.

COUNCIL CHAMBER

January 27, 2010

Section 9. That the City Manager is authorized and directed to file an Official Statement with respect to such bonds and prepare such other documents as are necessary and incidental to the issuance, sale and delivery of the bonds with the Attorney General; and that the City Controller be and is hereby authorized to make the payment for filing with the Attorney General’s office prior to receiving the Bond Proceeds (no later than February 24, 2010). The cost is estimated to be $9,500 and shall be made from the General Fund 0001, Department BMS, Unit 1125, Object 3537, Encumbrance Number CT SPRING10 AG FEE, (Vendor #344989) and shall be reimbursed with bond proceeds.

Section 10. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Dallas and it is accordingly so resolved.

DISTRIBUTION: CITY CONTROLLERS OFFICE, 4FS

ADDENDUM ITEM # 5KEY FOCUS AREA: Make Government More Efficient, Effective and Economical



DEPARTMENT: Human Resources

CMO: Mary K. Suhm, 670-5306

MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize a contract with Dallas Area Rapid Transit for the purchase of 450 annual passes in support of the City's 2008 clean air initiative - Not to exceed $147,951 - Financing: Current Funds (to be reimbursed by participating employees)

BACKGROUND

The Dallas Area Rapid Transit (DART) annual pass program is designed to increase DART ridership through a reduced fare to program participants. Passes allow unlimited transportation for a full calendar year (7 days per week) on DART bus, rail and commuter rail routes. It is expected to increase the use of public transportation by City employees, thereby decreasing automobile emissions.

Increasing City employees use of mass transportation is part of the City's clean air strategies. The 2010 program will be effective January 1, 2010, through December 31, 2010.

The DART Pass program is open to permanent civilian and uniformed Fire employees. Uniformed Police employees already ride free of charge on DART transportation routes. The City will purchase approximately 450 annual bus passes which will be reimbursed by participating employees through payroll deductions.

PRIOR ACTION/REVIEW (Council, Boards, Commissions)

Authorized the DART A-Pass program on January 22, 2003, by Resolution No. 03-0373.

Authorized the City funded DART A-Pass program as part of the FY 2003-04 budget on September 24, 2003, by Resolution No. 03-2570.


PRIOR ACTION/REVIEW (Council, Boards, Commissions)(Continued)

Authorized a contract with DART to purchase A-Passes on October 22, 2003, by Resolution No. 03-2881.

Authorized the City funded DART A-Pass program as part of the FY 2004-05 budget on September 22, 2004, by Resolution No. 04-2841.

Authorized the City funded DART pass program as part of the FY 2005-06 budget on September 28, 2005, by Resolution No. 05-2822.

Authorized a contract with DART to purchase A-Passes on October 26, 2005, by Resolution No. 05-3038.

Authorized purchase of 1,700 bus passes from Dallas Area Rapid Transit on behalf of City employees in support of the City’s 2007 clean air initiative on October 25, 2006, by Resolution No. 06-2962.

Authorized purchase of 2,000 bus passes from Dallas Area Rapid Transit on behalf of City employees in support of the City’s 2008 clean air initiative on October 24, 2007, by Resolution No. 07-3196.

Authorized purchase of 4,000 bus passes from Dallas Area Rapid Transit on behalf of City employees in support of the City’s 2008 clean air initiative on November 10, 2008, by Resolution No. 08-3508.

FISCAL INFORMATION

Current Funds - $147,951 (to be reimbursed by participating employees)

OWNER

Dallas Area Rapid Transit

Gary Thomas, President and Executive Director

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the City Council authorized the Dallas Area Rapid Transit A-Pass program on January 22, 2003 by Resolution No. 03-0373; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit A-Pass program on September 24, 2003 by Resolution No. 03-2570; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit A-Pass program on October 22, 2003 by Resolution No. 03-2881; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit A-Pass program on September 22, 2004 by Resolution No. 04-2841; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit Pass program on September 28, 2005 by Resolution No. 05-2822; and

WHEREAS, the City Council authorized a contract with Dallas Area Rapid Transit to purchase A-Passes on October 26,2005, by Resolution No 05-3038; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit Pass program on October 25, 2006 by Resolution No. 06-2962; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit Pass program on October 24, 2007 by Resolution No. 07-3196; and

WHEREAS, the City Council authorized the City funded Dallas Area Rapid Transit Pass program on November 10, 2008, by Resolution No. 08-3508; and

WHEREAS, it is the City's desire to execute a one-year contract for the 2010 Calendar year with Dallas Area Rapid Transit to purchase approximately 450 passes of which the cost will be paid by City employees. The cost will be reimbursed through employee payroll deductions.

NOW THEREFORE,


Section 1. That the City Manager be and is hereby authorized to enter into a contract, where a contract is required, after approval as to form by the City Attorney, for the purchase of approximately 450 DART Passes to include Paratransit coupon books on behalf of City employees in support of the City's clean air initiative.

Section 2. That the City Controller or designee be and is hereby authorized to make employee payroll deductions to reimburse the City to Fund 0001, Dept PER, Unit 1437, Object 5011.

COUNCIL CHAMBER

January 27, 2010

Section 3. That the City Controller or designee be and is hereby authorized to disburse funds from Fund 0001, Dept PER, Unit 1437, Object 3532, Encumbrance No. CT PER143706001 to Dallas Area Rapid Transit (Vendor #232802) for the purchase of approximately 450 passes, on behalf of City employees at a cost not to exceed $147,951 to be reimbursed through employee payroll deductions.

Section 4. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Dallas, and it is accordingly so resolved.

Distribution: Human Resources - 6ASOffice of Financial Services - 4FNCity Attorney's Office - 7DN

ADDENDUM ITEM # 6,7KEY FOCUS AREA: Economic Vibrancy



DEPARTMENT: Public Works & Transportation

CMO: Jill A. Jordan, P.E., 670-5299

MAPSCO: 55F________________________________________________________________

SUBJECT

Fiji-Compton Project

* Authorize (1) a contract for the construction of paving and drainage improvements for Avenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji Street, Sphinx Street, Tonga Street, and associated alleys with Alta Construction Services, Inc., lowest responsible bidder of six; and (2) assignment of the construction contract to Sphinx Development Corporation for construction administration and material testing - Not to exceed $1,818,799 - Financing: Capital Projects Reimbursement Funds

* Authorize Amendment No. 2 to the Development Agreement with Sphinx Development Corporation to revise the payment method of the construction contract - Financing: No cost consideration to the City

* BACKGROUND

Bids were received on December 17, 2009 for construction of the Fiji-Compton project. This action will authorize the construction contract for the Fiji-Compton project with Alta Construction Services, Inc., and assign construction administration and material testing for the project to Sphinx Development Corporation. This action will also authorize an amendment to the existing Development Agreement with Sphinx Development Corporation to allow the City to make construction payments directly to the contractor.

In April 2005, the Regional Transportation Council (RTC) allocated $40.61 million for their second Sustainable Development Program Call for Projects. The Sustainable Development Program is intended to promote development types that reduce the overall demand for transportation infrastructure and improve air quality. The project submission categories included transportation infrastructure improvements, land banking and planning programs. This project was one of nine infrastructure improvements projects selected and approved by the RTC on April 13, 2006. Council Resolution No. 06-1536 dated June 7, 2006, supported Sphinx Development Corporation's proposed Fiji-Compton Project that was approved for $2,811,986 in RTC Sustainable Development Program Funds.

Agenda Date 01/27/2010 -page 2


The Fiji-Compton project covers an area bounded by Corinth Street, Compton Street and the DART South Oak Cliff light rail transit (LRT) line and is within one-quarter mile of both DART's Eighth/Corinth and Morrell LRT stations. The project will provide infrastructure improvements to support planned single family and senior housing, as well as mixed-use development along Corinth Street with ground-level retail. The project's scope includes the demolition of existing pavement, clearing of the site, earthwork, storm drainage, retaining walls, lime stabilization, construction of 36’ wide streets, and landscaping. The project's estimated construction cost is $1,818,798.89, of which 80% ($1,455,039.11) is being funded by Sustainable Development Program funds, and 20% ($363,759.78) is being funded by the City of Dallas.

Alta Construction Services, Inc., has not completed a project with City of Dallas, to date:

PWT WTR PKRProjects On-going 0 0 0Change Orders N/A N/A N/AProjects Requiring Liquidated Damages N/A N/A N/AProjects Completed by Bonding Company N/A N/A N/A


Began Design January 2007Completed Design December 2009Begin Construction February 2010Complete Construction December 2010


Briefed the Transportation and Telecommunications Committee on September 26, 2005.

Briefed the Transportation and Telecommunications Committee on January 9, 2006, and recommended the Project submission list.

Authorized the land use development concepts on June 7, 2006, by Resolution No. 06-1536.

Authorized an interlocal agreement with the North Central Texas Council of Governments for design, right-of-way acquisition, and construction of the Fiji-Compton Project on December 13, 2006, by Resolution No. 06-3473.

Authorized a Development Agreement with Sphinx Development Corporation for the design and construction of the Fiji-Compton Project on December 13, 2006, by Resolution No. 06-3474.


PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS) (Continued)

Amended Resolution No. 06-3473 to authorize payment to the North Central Texas Council of Governments for the City’s share of design, right-of-way acquisition, and construction of the Fiji-Compton Project on June 27, 2007, by Resolution No. 07-2037.

Amended the Development Agreement with Sphinx Development Corporation to authorize payment to Sphinx Development Corporation for the design and construction of the Fiji-Compton Project on June 27, 2007, by Resolution No. 07-2038.

FISCAL INFORMATION

Capital Projects Reimbursement Funds - $1,818,798.89

M/WBE INFORMATION

See attached.

ETHNIC COMPOSITION

Alta Construction Services, Inc.

Hispanic Female 0 Hispanic Male 1African-American Female 0 African-American Male 0Other Female 0 Other Male 0White Female 2 White Male 4

BID INFORMATION

The following bids with quotes were received and opened on December 17, 2009:

*Denotes successful bidder

BIDDERS BID AMOUNT

*Alta Construction Services, Inc. $ 1,818,798.89 4805 Keller Springs Road

Addison, TX 75001Rebcon, Inc. $ 1,973,641.80Jeske Construction Company $ 1,987,379.76Texas Standard Construction $ 2,012,727.87P&E Contractors, Inc. $ 2,095,635.95PAEE Corporation $ 2,336,029.81

Original estimate: PBW $ 2,544,520.70


OWNER(S)

Alta Construction Services, Inc.

Jeff Hartlieb, President

MAP

Attached.


PROJECT: Authorize (1) a contract for the construction of paving and drainage improvements for Avenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji Street, Sphinx Street, Tonga Street, and associated alleys with Alta Construction Services, Inc., lowest responsible bidder of six; and (2) assignment of the construction contract to Sphinx Development Corporation for construction administration and material testing – Not to exceed $1,818,799 – Financing: Capital Projects Reimbursement Funds

Alta Construction Services, Inc. is a local, non-minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use the following sub-contractors.PROJECT CATEGORY: Construction

_______________________________________________________________


Amount Percent

Total local contracts $439,549.89 24.17%Total non-local contracts $1,379,249.00 75.83%

------------------------ ------------------------

TOTAL CONTRACT $1,818,798.89 100.00%




Miko Trucking HMDB40743Y0310 $75,000.00 17.06%------------------------ ------------------------

Total Minority - Local $75,000.00 17.06%


Non-local Certification Amount Percent

San Saba ConstructionA.S.T. Landscape Services, Inc.Brock Environmental Services, LLC

HMDB43461Y1210HMMB42278Y0910WFWB42115Y0810

$230,379.00$195,092.00

$12,910.00

16.70%14.14%

0.94%------------------------ ------------------------

Total Minority - Non-local $438,381.00 31.78%



African American $0.00 0.00% $0.00 0.00%Hispanic American $75,000.00 17.06% $500,471.00 27.52%Asian American $0.00 0.00% $0.00 0.00%Native American $0.00 0.00% $0.00 0.00%WBE $0.00 0.00% $12,910.00 0.71%

---------------------- ---------------------- ---------------------- -----------------------

Total $75,000.00 17.06% $513,381.00 28.23%

(Fiji-Compton Project)

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COUNCIL CHAMBER

January 27, 2010

WHEREAS, the Regional Transportation Council approved $40.61 million for a Sustainable Development Program Call for Projects on April 14, 2005; and,

WHEREAS, the City of Dallas submitted a Sustainable Development Program application for the Fiji-Compton Project to the North Central Texas Council of Governments prior to the January 20, 2006 deadline; and,

WHEREAS, the Regional Transportation Council approved $2,811,986 in Regional Transportation Council Local Funds under the Sustainable Development Program for the Fiji-Compton Project on April 13, 2006; and,

WHEREAS, the Sustainable Development Program requires a minimum local match of 20 percent of the total project cost of $3,514,983, or $702,997, to be provided by City of Dallas; and,

WHEREAS, on June 7, 2006, Resolution No. 06-1536 supported the land use development concepts of the Fiji-Compton Project; and,

WHEREAS, on December 13, 2006, Resolution No. 06-3473 authorized an interlocal agreement with the North Central Texas Council of Governments for design, right-of-way acquisition, and construction of the Fiji-Compton Project; and,

WHEREAS, on December 13, 2006, Resolution No. 06-3474 authorized a Development Agreement with Sphinx Development Corporation for the design and construction of the Fiji-Compton Project; and,

WHEREAS, on June 27, 2007, Resolution No. 07-2037 amended Resolution 06-3473 to authorize payment to the North Central Texas Council of Governments for the City’s share of design, right-of-way acquisition, and construction of the Fiji-Compton Project; and,

WHEREAS, on June 27, 2007, Resolution No. 07-2038 amended the Development Agreement with Sphinx Development Corporation to authorize payment to Sphinx Development Corporation for the design and construction of the Fiji-Compton Project; and,

WHEREAS, in accordance with the Development Agreement approved December 13, 2006, by Resolution No. 06-3474, with Sphinx Development Corporation, it is now necessary to assign construction administration and material testing to Sphinx Development Corporation; and,

COUNCIL CHAMBER

January 27, 2010

WHEREAS, bids were received on December 17, 2009, for the construction of paving and drainage improvements for Avenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji Street, Sphinx Street, Tonga Street, and associated alleys as follows:

BIDDERS BID AMOUNT

Alta Construction Services, Inc. $ 1,818,798.89Rebcon, Inc. $ 1,973,641.80Jeske Construction Company $ 1,987,379.76Texas Standard Construction $ 2,012,727.87P&E Contractors, Inc. $ 2,095,635.95PAEE Corporation $ 2,336,029.81

Now, Therefore,


Section 1. That the City Manager is hereby authorized to enter into a contract with Alta Construction Services, Inc. for the construction of paving and drainage improvements for Avenue A, Avenue B, Avenue C, Compton Street, Fran Way, Fiji Street, Sphinx Street, Tonga Street, and associated alleys in an amount not to exceed $1,818,798.89, this being the lowest responsible bid received as indicated by the tabulation of bids.

Section 2. That the City Manager is hereby authorized to execute the contract after it has been approved as to form by the City Attorney.

Section 3. That in accordance with the Development Agreement, as currently amended, with Sphinx Development Corporation, the construction contract is hereby assigned to Sphinx Development Corporation for construction administration and material testing.

Section 4. That the City Controller is hereby authorized to disburse funds in accordance with the terms and conditions of the contract from:

Capital Projects Reimbursement FundsFund 0556, Dept. PBW, Unit P355, Act. PPPFObj. 4510, Program #PB03P355, CT PBW03P355D1Vendor #VS0000050135, in an amount not to exceed $1,818,798.89

Total in an amount not to exceed $1,818,798.89

COUNCIL CHAMBER

January 27, 2010


Distribution: Public Works and Transportation, Tami Wilson, OCMC, Room 101Public Works and Transportation, Dawna Brown, City Hall, L1BSController’s Office, Sherrian Parham, City Hall, 4BNCity Attorney

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the Regional Transportation Council approved $40.61 million for a Sustainable Development Program Call for Projects on April 14, 2005; and,

WHEREAS, the City of Dallas submitted a Sustainable Development Program application for the Fiji-Compton Project to the North Central Texas Council of Governments prior to the January 20, 2006 deadline; and,

WHEREAS, the Regional Transportation Council approved $2,811,986 in Regional Transportation Council Local Funds under the Sustainable Development Program for the Fiji-Compton Project on April 13, 2006; and,

WHEREAS, the Sustainable Development Program requires a minimum local match of 20 percent of the total project cost of $3,514,983, or $702,997, to be provided by City of Dallas; and,

WHEREAS, on June 7, 2006, Resolution No. 06-1536 supported the land use development concepts of the Fiji-Compton Project; and,

WHEREAS, on December 13, 2006, Resolution No. 06-3473 authorized an interlocal agreement with the North Central Texas Council of Governments for design, right-of-way acquisition, and construction of the Fiji-Compton Project; and,

WHEREAS, on December 13, 2006, Resolution No. 06-3474 authorized a Development Agreement with Sphinx Development Corporation for the design and construction of the Fiji-Compton Project; and,

WHEREAS, on June 27, 2007, Resolution No. 07-2037 amended Resolution No. 06-3473 to authorize payment to the North Central Texas Council of Governments for the City’s share of design, right-of-way acquisition, and construction of the Fiji-Compton Project; and,

WHEREAS, on June 27, 2007, Resolution No. 07-2038 amended the Development Agreement with Sphinx Development Corporation to authorize payment to Sphinx Development Corporation for the design and construction of the Fiji-Compton Project; and,

WHEREAS, it is now necessary to authorize Amendment No. 2 to the Development Agreement with Sphinx Development Corporation to revise the payment method of the construction contract.

COUNCIL CHAMBER

January 27, 2010

Now, Therefore,


Section 1. That the City Manager is hereby authorized to execute Amendment No. 2 to the Development Agreement with Sphinx Development Corporation, after it has been approved as to form by the City Attorney.


Distribution: Public Works and Transportation, Tami Wilson, OCMC, Room 101Public Works and Transportation, Dawna Brown, City Hall, L1BSController’s Office, Sherrian Parham, 4BNCity Attorney

ADDENDUM ITEM # 8,9,10KEY FOCUS AREA: Economic Vibrancy



DEPARTMENT: Public Works & Transportation


MAPSCO: 35M R 36F J K________________________________________________________________

SUBJECT

Katy Trail, Phase III

* Authorize (1) a contract with JRJ Paving, L.P., lowest responsible bidder of eleven, for construction of Katy Trail, Phase III from McCommas Street to Sandhurst Street in an amount not to exceed $809,298; (2) the receipt and deposit of funds from the Texas Department of Transportation in an amount not to exceed $647,438; and (3) an increase in appropriations in the amount of $647,438 in the Capital Projects Reimbursement Fund - Total not to exceed $809,298 - Financing: 1998 Bond Funds ($161,860) and Capital Projects Reimbursement Funds ($647,438)

* Authorize a license agreement with Dallas Area Rapid Transit for the use of DART right-of-way to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Avenue – Financing: No cost consideration to the City

* Authorize a license agreement with ONCOR for the use of ONCOR right-of-way to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Avenue – Financing: No cost consideration to the City

BACKGROUND

Bids were received on January 14, 2010, for construction of Katy Trail, Phase III from McCommas Street to Sandhurst Street. This action will authorize a construction contract with JRJ Paving, L.P., as they were the lowest responsible bidder for the construction of Katy Trail, Phase III. This action will also authorize a license agreement with Dallas Area Rapid Transit (DART) and a license agreement with ONCOR to use their respective rights-of-way to construct and maintain the trail.



Katy Trail, Phase III was nominated and accepted as a candidate project in the Congestion Mitigation Air Quality Program (CMAQ) provided by the Transportation Equity Act. CMAQ provides for reimbursement of 80 percent of allowable costs for up to $1.6M, for engineering and construction. The City is responsible for 20 percent local match and the cost overrun. The City of Dallas administered the design and will administer the construction of this project. The scope of Katy Trail, Phase III is to construct a 12-foot wide concrete hike and bike trail from McCommas Boulevard at North Central Expressway to Sandhurst Street west of Skillman Street, excluding trail segment between Ellsworth Street and Worcola Street.

The estimated construction cost for Katy Trail, Phase III is $809.297.92. The City's share of construction cost is $161,859.58 and is being funded by the 1998 Bond Program. The remaining construction costs in the amount of $647,438.34 are being funded with federal CMAQ funds. Upon completion of the project, the City will be responsible for maintaining the trail.


Began Design March 2008Completed Design August 2009Begin Construction March 2010Complete Construction December 2010


Authorized TEA-21's First Call for Projects on April 28, 1999, by Resolution No. 99-1459.

Authorized STEP's Call for Projects on May 23, 2001, by Resolution No. 01-1667.

Authorized a professional services contract with Washington Infrastructure Services, Inc. on October 10, 2001, by Resolution No. 01-3024.

Authorized an Interlocal Agreement with the Texas Department of Transportation on October 10, 2001, by Resolution No. 01-3025.

Authorized Supplemental Agreement No. 1 to the contract with Washington Infrastructure Services, Inc. on April 24, 2002, by Resolution No. 02-1346.

Authorized Supplemental Agreement No. 2 to the contract with Washington Infrastructure Services, Inc. on December 11, 2002, by Resolution No. 02-3488.



Authorized Supplemental Agreement No. 5 to the contract with Washington Group International, Inc. (formerly Washington Infrastructure Services, Inc.) on June 8, 2005, by Resolution No. 05-1721.

Authorized a professional services contract with HNTB Corporation on February 27, 2008, by Resolution No. 08-0683-01.

FISCAL INFORMATION

1998 Bond Funds - $161,859.58Capital Project Reimbursement Funds - $647,438.34

M/WBE INFORMATION

See attached.

ETHNIC COMPOSITION

JRJ Paving, L.P.



BID INFORMATION

The following bids with quotes were received and opened on January 14, 2010:

*Denotes successful bidder

BIDDERS BID AMOUNT

*JRJ Paving, L.P. $ 809,297.92 1805 Royal Lane, Suite 105 Dallas, Texas 75229Ed Bell Construction Company $ 857,957.85Omega Contracting, Inc. $ 943,510.20PAEE Corporation $ 983,816.22Linder Construction Company $1,018,680.00Northstar Construction, Inc. $1,022,280.50Austin Bridge & Road $1,048,888.00C. Green Scaping, LP $1,071,566.45Rebcon, Inc. $1,082,384.00Ratliff Hardscape, LTD $1,123,882.20MACVAL Associates, LLC $1,376,210.00

OWNER(S)

JRJ Paving, L.P.

John Marriott, Jr., President

MAP

Attached


PROJECT: Authorize (1) a contract with JRJ Paving, L.P., lowest responsible bidder of eleven, for construction of Katy Trail, Phase III from McCommas Street to Sandhurst Street in an amount not to exceed $809,298; (2) the receipt and deposit of funds from the Texas Department of Transportation in an amount not to exceed $647,438; and (3) an increase in appropriations in the amount of $647,438 in the Capital Projects Reimbursement Fund - Total not to exceed $809,298 - Financing: 1998 Bond Funds ($161,860) and Capital Projects Reimbursement Funds ($647,438)

JRJ Paving, L.P. is a local, non-minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use the following sub-contractors.PROJECT CATEGORY: Construction

_______________________________________________________________


Amount Percent

Total local contracts $747,876.92 92.41%Total non-local contracts $61,421.00 7.59%

------------------------ ------------------------

TOTAL CONTRACT $809,297.92 100.00%




I.H. Concrete CuttingSorianos TruckingUniversal Fence Co.American Striping Co.

BMBD41240Y0510HMMB41129N0510WFWB41559N0610WFDB43803Y0111

$124,473.00$39,600.00$32,119.00$12,403.00

16.64%5.29%4.29%1.66%

------------------------ ------------------------




Hardscape SpecialitiesTexas Environmental Management

HMMB40820N0410WFDB30245Y0310

$18,080.00$43,341.00

29.44%70.56%

------------------------ ------------------------




African American $124,473.00 16.64% $124,473.00 15.38%Hispanic American $39,600.00 5.29% $57,680.00 7.13%Asian American $0.00 0.00% $0.00 0.00%Native American $0.00 0.00% $0.00 0.00%WBE $44,522.00 5.95% $87,863.00 10.86%

---------------------- ---------------------- ---------------------- -----------------------

Total $208,595.00 27.89% $270,016.00 33.36%

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COUNCIL CHAMBER

January 27, 2010

WHEREAS, on April 28, 1999, Resolution No. 99-1459 authorized the submission, acceptance and implementation of City of Dallas candidate projects for the Congestion Mitigation Air Quality Program (CMAQ); and,

WHEREAS, KATY Trail was accepted in March 2000 as a candidate project in the First Call for Projects in the Congestion Mitigation Air Quality (CMAQ) under the Transportation Equity Act of the 21st Century (TEA-21); and,

WHEREAS, on October 10, 2001, Resolution No. 01-3024 authorized a professional services contract with Washington Infrastructure Services, Inc. to provide engineering services for bicycle and pedestrian enhancements for Phase III of the KATY Trail extension from McCommas Boulevard at North Central Expressway to Sandhurst Street just west of Skillman Street and from Lyte Street at north Houston Street to Levee Street at Manufacturing Street in the amount of $234,190; and,

WHEREAS, on October 10, 2001, Resolution No. 01-3025 authorized an Interlocal Agreement with Texas Department of Transportation for design, right-of-way acquisition, utility relocations, and construction of bicycle and pedestrian enhancements for Phase III of KATY Trail extension; and,

WHEREAS, on April 24, 2002, Resolution No. 02-1346 authorized Supplemental Agreement No. 1 to the contract with Washington Infrastructure Services, Inc. to provide additional engineering services for a bicycle and pedestrian bridge over Mockingbird Lane at approximately 600 feet east of North Central Expressway in an amount not to exceed $94,000, increasing the contract from $234,190 to $328,190; and,

WHEREAS, on December 11, 2002, Resolution No. 02-3488 authorized Supplemental Agreement No. 2 to the contract with Washington Infrastructure Services, Inc. to (1) decrease engineering services for a bicycle and pedestrian bridge over Mockingbird Lane and provide additional engineering services for the selected alternate alignment of Phase III of the KATY Trail extension in an amount not to exceed ($35,979), and (2) provide engineering services for Phase IV of the KATY Trail extension from Skillman Street to White Rock Station in an amount not to exceed $436,971, for a net amount not to exceed $400,992, increasing the contract from $328,190 to $729,162; and,

WHEREAS, on May 8, 2003, Administrative Action No. 03-1284 authorized Supplemental Agreement No. 3 to the contract with Washington Infrastructure Services, Inc. to provide additional engineering services necessary to extend project limits and to provide field notes in the amount of $15,000, increasing the contract from $729,182 to $744,182; and,

COUNCIL CHAMBER

January 27, 2010

WHEREAS, on March 2, 2004, Administrative Action No. 04-0924 authorized Supplemental Agreement No. 4 to the contract with Washington Infrastruture Services, Inc. to provide additional engineering services necessary to reduce the width of Winton Street and modify the proposed trail alignment in the amount of $14,889.50, increasing the contract from $744,182 to $759,081.50; and,

WHEREAS, on June 8, 2005, Resolution No. 05-1721 authorized Supplemental Agreement No. 5 to the contract with Washington Group International, Inc. (formerly Washington Infrastructure Services, Inc.) to provide additional engineering services for Phase III and Phase IV of the KATY Trail extension in the amount of $51,275, increasing the contract from $759,082 to $810,537; and,

WHEREAS, it was determined to be in the best interest of the City and the project to terminate Washington Group International, Inc. (formerly Washington Infrastructure Services, Inc.); and,

WHEREAS, on February 27, 2008, Resolution No. 08-0683-01 authorized a professional services contract with HNTB Corporation to provide engineering services for the final design and preparation of construction plans and specifications for bicycle and pedestrian enhancements for Katy Trail, Phase III from McCommas Street to Sandhurst ; and,

WHEREAS, bids were received on January 14, 2010, for the construction of bicycle and pedestrian enhancements for Katy Trail, Phase III from McCommas Street to Sandhurst Street as follows:

BIDDERS BID AMOUNT

JRJ Paving, L.P. $ 809,297.92Ed Bell Construction Company $ 857,957.85Omega Contracting, Inc. $ 943,510.20PAEE Corporation $ 983,816.22Linder Construction Company $1,018,680.00Northstar Construction, Inc. $1,022,280.50Austin Bridge & Road $1,048,888.00C. Green Scaping, LP $1,071,566.45Rebcon, Inc. $1,082,384.00Ratliff Hardscape, LTD $1,123,882.20MACVAL Associates, LLC $1,376,210.00

COUNCIL CHAMBER

January 27, 2010

Now, Therefore,


Section 1. That the City Manager is hereby authorized to enter into a contract with JRJ Paving, L.P. for the construction of bicycle and pedestrian enhancements for Katy Trail, Phase III from McCommas Street to Sandhurst Street, in an amount not to exceed $809,297.92, this being the lowest responsible bid received as indicated by the tabulation of bids.

Section 2. That the City Manager is hereby authorized to execute the contract after it has been approved as to form by the City Attorney.

Section 3. That the City Controller is hereby authorized to deposit funds from the Texas Department of Transportation in an amount not to exceed $647,438.34 in the Capital Projects Reimbursement Fund 0556, Department PBW, Unit N946, Revenue Source 6506.

Section 4. That the City Manager is hereby authorized to increase appropriations in the Capital Projects Reimbursement Fund 0556, Agency PBW, Org N946, Obj. 4510 in the amount of $647,438.34.

Section 5. That the City Controller is hereby authorized to disburse funds in accordance with the terms and conditions of the construction contract from:

Street and Thoroughfare Improvements FundFund 0P22, Department PBW, Unit N946, Act. INGVObj. 4510, Program #PB98N946, CT PBW98N946D1Vendor #267467, in an amount not to exceed $161,859.58

Capital Projects Reimbursement FundFund 0556, Department PBW, Unit N946, Act. INGVObj. 4510, Program #PB98N946, CT PBW98N946D1Vendor #267467, in an amount not to exceed $647,438.34

Total amount not to exceed $809,297.92


Distribution: Public Works and Transportation, Tami Wilson, OCMC, Room 101Public Works and Transportation, Dawna Brown, 1500 Marilla, L1BSCity Controller’s Office, Sherrian Parham, 1500 Marilla, 4BN City Attorney

COUNCIL CHAMBER

January 27, 2010








COUNCIL CHAMBER

January 27, 2010

WHEREAS, on March 2, 2004, Administrative Action No. 04-0924 authorized Supplemental Agreement No. 4 to the contract with Washington Infrastruture Services, Inc. to provide additional engineering services necessary to reduce the width of Winton Street and modify the proposed trail alignment in the amount of $14,889.50, increasing the contract from $744,182 to $759,081.50; and,


WHEREAS, on February 27, 2008, Resolution No. 08-0683-01 authorized a professional services contract with HNTB Corporation to provide engineering services for the final design and preparation of construction plans and specifications for bicycle and pedestrian enhancements for Katy Trail, Phase III from McCommas Street to Sandhurst; and,

WHEREAS, the Dallas Area Rapid Transit (DART) and the City of Dallas desire bicycle and pedestrian enhancements on Katy Trail, Phase III from McCommas Street to Sandhurst Street; and,

WHEREAS, it is necessary to authorize a License Agreement with DART for the joint use of DART right-of-way in order to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman Street.

Now, Therefore,


Section 1. That the City Manager is hereby authorized to execute the License Agreement with DART for the joint use of DART right-of-way for the development and construction of bicycle and pedestrian enhancements of Katy Trail, Phase III from Worcola Street to Skillman Street, after it has been approved as to form by the City Attorney.



COUNCIL CHAMBER

January 27, 2010








COUNCIL CHAMBER

January 27, 2010

WHEREAS, on March 2, 2004, Administrative Action No. 04-0924 authorized Supplemental Agreement No. 4 to the contract with Washington Infrastructure Services, Inc. to provide additional engineering services necessary to reduce the width of Winton Street and modify the proposed trail alignment in the amount of $14,889.50, increasing the contract from $744,182 to $759,081.50; and,


WHEREAS, on February 27, 2008, Resolution No. 08-0683-01 authorized a professional services contract with HNTB Corporation to provide engineering services for the final design and preparation of construction plans and specifications for bicycle and pedestrian enhancements for Katy Trail, Phase III from McCommas Street to Sandhurst; and,

WHEREAS, ONCOR and the City of Dallas desire bicycle and pedestrian enhancements on Katy Trail, Phase III from McCommas Street to Sandhurst Street; and,

WHEREAS, it is necessary to authorize a License Agreement with ONCOR for the use of ONCOR right-of-way in order to construct and maintain the proposed Katy Trail, Phase III from Worcola Street to Skillman.

Now, Therefore,


Section 1. That the City Manager is hereby authorized to execute the License Agreement with ONCOR for the joint use of ONCOR right-of-way for the development and construction of bicycle and pedestrian enhancements of Katy Trail, Phase III from Worcola Street to Skillman Street, after it has been approved as to form by the City Attorney.






DEPARTMENT: Sustainable Development and Construction


MAPSCO: 23J________________________________________________________________

SUBJECT

A resolution declaring an undevelopable City-owned tract of land containing approximately 780 square feet located near the intersection of Shady Trail and Southwell Road as unwanted and unneeded and authorize its sale to William B. Jordan, the abutting owner – Revenue: $5,800

BACKGROUND

This item will declare an undevelopable City-owned tract of land containing approximately 780 square feet located near the intersection of Shady Trail and Southwell Road as unwanted and unneeded and authorize its sale to William B. Jordan, the abutting owner. The purchase price is based on an independent appraisal. The land cannot be used independently under the current zoning or under applicable subdivision or other development control ordinances, and should be sold only to the abutting owner.

The Property will be conveyed with: 1) a restriction prohibiting the placement of industrialized housing; 2) a reservation of all oil, gas and other minerals in and under the property; and 3) a reservation of an easement for storm water drainage and wastewater facilities. The current zoning for this property is Industrial and the tax value is $3,120. This land will return to the tax rolls upon conveyance.


This item has no prior action.

FISCAL INFORMATION

Revenue: $5,800

OWNER

William B. Jordan


MAPS

Attached

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Mapsco 23J

Southwell Rood

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Subject Area

COUNCIL CHAMBER

3

January 27, 2010

WHEREAS, the City of Dallas is the owner of a tract of land containing approximately 780 square feet of land, situated in Lot 11-A, Block E/6513, Dallas, Dallas County, Texas, (the “Property”), and located near the intersection of Shady Trail and Southwell Road, which is no longer needed for municipal use; and

WHEREAS, the tract is a narrow strip of land, that because of its shape and small area, cannot be used independently under its current zoning or under applicable subdivision or other development control ordinances, and may be sold without public bid to the abutting owner; and

WHEREAS, William B. Jordan, the abutting property owner, proposes to purchase said property at fair market value; Now, Therefore,


SECTION 1. That upon receipt of FIVE THOUSAND EIGHT HUNDRED AND NO/100 ($5,800.00) DOLLARS from William B. Jordan, the City Manager or designee is authorized to execute a Deed Without Warranty, to be attested by the City Secretary upon approval as to form by the City Attorney for approximately 780 square feet of land situated in Lot 11-A, Block E/6513, Dallas, Dallas County, Texas and located near the intersection of Shady Trail and Southwell Road. The Deed Without Warranty is subject to the conditions contained in Section 2.

SECTION 2. That the Deed Without Warranty shall provide that the conveyance to William B. Jordan ("GRANTEE") is subject to the following:

(a) the retention and reservation of an easement across the entire Property for storm water drainage and wastewater facilities; and

(b) any visible and apparent easements and any encroachments whether of record or not; and

(c) any and all covenants, conditions, reservations, restrictions, exceptions, easements, rights-of-way, mineral interests, mineral leases or other instruments of record and applicable to the property or any part thereof; and

COUNCIL CHAMBER

4

January 27, 2010

(d) to the maximum extent allowed by law, (i) GRANTEE is taking the Property “AS IS, WHERE IS, WITH ALL FAULTS”; (ii) GRANTOR disclaims responsibility as to the accuracy or completeness of any information relating to the Property; (iii) GRANTEE assumes all responsibility to examine all applicable building codes and zoning ordinances to determine if the Property can be used for the purposes desired and to check for outstanding or pending code enforcement actions including but not limited to repair or demolition orders; and (iv) GRANTOR expressly disclaims and GRANTEE expressly waives, any warranty or representation, express or implied, including without limitation any warranty of condition, habitability, merchantability or fitness for a particular purpose of the Property; and

(e) GRANTOR makes no representations of any nature regarding the Property and specifically disclaims any warranty, guaranty or representation, oral or written, express or implied, past, present, or future, concerning: (i) the nature and condition of the Property, including without limitation, the water, soil and geology, and the suitability thereof and the Property for any and all activities and uses which GRANTEE may elect to conduct thereon, and the existence of any environmental substances, hazards or conditions or presence of any endangered or protected species thereon or compliance with all applicable laws, rules or regulations; (ii) the nature and extent of any right-of-way, lease, possession, lien, encumbrance, license, reservation, condition or otherwise; (iii) the compliance of the Property or its operation with any law, ordinance or regulation of any federal, state, or local governmental authority; and (iv) whether or not the Property can be developed or utilized for any purpose. For purposes hereof, “environmental substances” means the following: (a) any “hazardous substance” under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C.A. Section 9601 et. seq., as amended, (b) any “hazardous substance” under the Texas Hazardous Substances Spill Prevention and Control Act, Tex. Water Code, Section 26.261, et. seq., as amended, (c) petroleum or petroleum-based products (or any derivative or hazardous constituents thereof or additives thereto), including without limitation, fuel and lubrication oils, (d) any “hazardous chemicals” or “toxic chemicals” under the Occupational Safety and Health Act, 29 U.S.C.A. Section 651 et. seq, as amended, (e) any “hazardous waste” under the Resource Conservation and Recovery Act, 42 U.S.C.A. Section 6901 et. seq., as amended, (f) asbestos, (g) polychlorinated biphenyls, (h) underground storage tanks, whether empty, filled, or partially filled with any substance, (i) any substance, the presence of which is prohibited by federal, state or local laws and regulations, and (j) any other substance which by federal, state or local laws and regulations requires special handling or notification of governmental authorities in its collection, storage, treatment or disposal. References to particular acts or codifications in this definition include all past and future amendments thereto, as well as applicable rules and regulations as now or hereafter promulgated thereunder; and

COUNCIL CHAMBER

January 27.2010

(f) such other terms and requirements of the sale and/or disclaimers as the Citydeems necessary, convenient or appropriate.

SECTION 3. That the sale proceeds shall be deposited into the General Fund 0001,Agency DEV, Sal Sheet 0519 and Department of Sustainable Development andConstruction, Real Estate Division shall be reimbursed for the cost of obtaining legaldescription, appraisal and other administrative costs incurred. The reimbursementproceeds shall be deposited in Fund 0001, Dept. DEV, Unit 1183, Object 5011 and anyremaining proceeds shall be transferred to the Water and Sewer Revenue Fund 0100,Department DWU, Unit 7005, Revenue Source 8118.

SECTION 4. That if a title policy is desired by purchaser, same shall be at the expenseof said purchaser.

SECTION 5. That the sale shall be subject to standby fees, taxes and assessments, ifany, by any taxinq authority for the year of closing and subsequent years andassessments by any taxing authority for prior years due to changes in land usage orownership, the payment of said standby fees, taxes and assessments being assumedby grantee.

SECTION 6. That the procedures required by Section 2-24 of the Dallas City Code thatare not required by state law concerning the sale of unneeded real property are waivedwith respect to this tract of land.

SECTION 7. That this Resolution shall take effect immediately from and after itspassage in accordance with the provisions of the Charter of the City of Dallas, and it isaccordingly so resolved.

APPROVED AS TO FORM:THOMAS P. PERKINS, Jr., City Attorney



COUNCIL DISTRICT(S): 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 13, 14, 15

DEPARTMENT: Office of Economic Development


MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize (1) amendments to the Dallas Development Fund’s certificate of formation and bylaws; and (2) the City Manager to file the amended certificate of formation with the Secretary of State - Financing: No cost consideration to the City

BACKGROUND

NMTC program and CDE designation

The City of Dallas authorized the creation of the Dallas Development Fund (DDF), a non-profit Community Development Entity (CDE), by Resolution No. 09-0461 on February 11, 2008, to apply for a New Markets Tax Credit (NMTC) allocation from the U.S. Department of Treasury’s Community Development Financial Institutions Fund in its FY09 funding cycle. DDF was awarded a $55 million allocation under the FY09 cycle.

The NMTC program permits taxpayers to receive a credit against federal income taxes for making qualified equity investments in designated CDEs. These investments must be used by the CDE for projects and investments in low-income communities, and the City believes the allocation would be beneficial to provide additional opportunities for development in low-income areas. The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year credit allowance period.

To accept the NMTC allocation, the DDF must have for-profit subsidiaries in place, each of which will also need a CDE designation. The CDE must be a legal entity at the time of the signing of the NMTC allocation agreement.

The CDE application must include the Employer Identification Number from the Internal Revenue Service, and certification of formation as filed at the state level, with amendments.



In addition, the CDE must have a primary mission of serving or providing investment capital to Low Income Communities (LIC) or Low Income Persons and at least 60% of its activities target Low Income Persons or Communities. At least 20% of the board must represent LICs to demonstrate accountability to residents by residing in a LIC within a designated service area or representing interests of residents of LICs, through employment, board service, etc.

Creation of for-profit subsidiaries

In order to receive the awarded NMTC allocation, the City Council is asked to make revisions to DDF’s bylaws and certificate of formation to allow for the creation of for-profit subsidiaries. These revisions will allow DDF to be incompliance with both the federal regulations governing the NMTC program and the Texas Constitution, which prohibits municipalities from owning a for-profit entity.

For accounting purposes, it is recommended that one subsidiary is formed for each NMTC project; DDF is proposing to create five for-profit project subsidiaries. Two additional subsidiaries (management and holding) are created to form a LLC for DDF operations. The management and holding subsidiaries will each have a 50% ownership position in the for-profit CDEs until individual transactions close. After the transactions close, the DDF subsidiaries will transfer ownership to individual project tax credit investors who become 99.9% owners of each for-profit CDE. The DDF management subsidiary will retain a .01% ownership as well as management responsibility.

The subsidiaries are formed exclusively for the benefit of, and to assist in carrying out the economic development program and objectives of the City by generating private investment capital through the NMTC Program to be made available for investment in LICs.

Recommended Bylaw and Certificate of Formation changes

To create the for-profit entities necessary to accept the NMTC allocation and remain in compliance with Texas law, changes to the DDF bylaws and certificate of formation are necessary, the primary being the creation of a new board of directors structure. The new board structure will consist of two classes of directors with three (3) class I directors appointed by the City Manager and the remaining four (4) self-elected. There will be no change to current board membership, which was appointed by the City Manager and confirmed by Council.

The class I directors must vote unanimously on matters related to investment/deal decisions, including project development agreements, and any changes to the DDF certificate of formation and/or bylaws which would change the class I directors' control over investment/deal decisions. In addition to the unanimous vote of the class I directors, there must be at least one vote from a class II director for matters listed previously. All other matters require a majority vote regardless of class I or II status.



In addition, LIC representation changes from a minimum of five (5) to three (3) out of the seven (7) board directors.

Under these changes, Council will no longer approve the appointment of DDF board members, amendments to the DDF bylaws and certificate of formation, or approve the organizational documents for any for-profit CDE that the Corporation may create. However, the City Council will approve all development agreements for projects that would be receiving NMTC funds.


On February 11, 2009, the City Council approved the creation of the Dallas Development Fund and authorized the DDF to apply for an allocation under the New Markets Tax Credit program.

On January 13, 2010, the City Council authorized the acceptance of the $55 million NMTC allocation.

On January 19, 2010, the Economic Development Committee was briefed on the DDF and the NMTC program.

FISCAL INFORMATION

No cost consideration to the City

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the City is committed to supporting enhanced economic development opportunities for low-income communities within the City and to low-income persons residing within those communities; and

WHEREAS, the United States Department of Treasury has established the New Markets Tax Credit (NMTC) program to stimulate investments in predominately low-income communities; and

WHEREAS, the goals and purposes of the NMTC program are consistent with and complementary to the economic development programs previously established by the City to support expanded economic development opportunities for low-income communities within the City and to low-income persons residing within those communities; and

WHEREAS, under the NMTC program, tax credits are competitively awarded annually by the Treasury Department through its Community Development Financial Institutions (CDFI) Fund to qualified Community Development Entities (CDEs) after review and evaluation of applications submitted by CDEs, which are then made available to investors; and

WHEREAS, the City of Dallas created the Dallas Development Fund (DDF) as a non-profit Texas corporation in order to apply for an award under the NMTC program; and

WHEREAS, the DDF was awarded a $55 million NMTC allocation under the 2009 NMTC program; and

WHEREAS, in order for the City of Dallas to accept the $55 million NMTC award, the DDF must create for-profit subsidiary CDEs; and

WHEREAS, in order to receive the awarded NMTC allocation and to satisfy both federal and Texas state law, the City Council is asked to make revisions to DDF’s bylaws and certificate of formation to allow for the creation of for-profit subsidiaries.

NOW, THEREFORE,


Section 1. That in order for the DDF to create the for-profit entities to accept the NMTC allocation as required by federal regulations, changes to the DDF bylaws and certificate of formation to revise the structure of the board of directors are necessary.

COUNCIL CHAMBER

January 27, 2010

Section 2. That the new board structure will consist of two classes of directors with three (3) class I directors appointed by the City Manager and the remaining four (4) directors to be self-elected.

Section 3. That there will be no change to current board membership, which was appointed by the City Manager and confirmed by Council.

Section 4. That the class I directors must vote unanimously on matters related to investment/deal decisions, including project development agreements, and any changes to the DDF certificate of formation and/or bylaws which would change the class I directors' control over investment/deal decisions and, in addition to the unanimous vote of the class I directors, there must be at least one vote from a class II director for matters listed previously. All other matters require a majority vote of the board regardless of class I or II status.

Section 5. That Low Income Community representation on the board will change from a minimum of five (5) to a minimum of three (3) out of the seven (7) board directors.

Section 6. That under the forgoing changes to the DDF certificate of formation and bylaws, Council will no longer approve the appointment of DDF board members, amendments to the DDF bylaws and certificate of formation, or approve the organizational documents for any for-profit CDE that the Corporation may create.

Section 7. That the City Council will approve all development agreements for projects that would be receiving NMTC funds.

Section 8. That the amendments to the bylaws and certificate of formation of the Dallas Development Fund are hereby authorized for the purpose of allowing the DDF to independently create up to seven for-profit corporations.

Section 9. That the City Manager is directed to file an amended certificate of formation, approved as to form by the City Attorney, with the Secretary of State.

Section 10. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City, and it is accordingly so resolved.

Distribution: Office of Economic Development – Tenna Kirk, 5CSOffice of Economic Development – Sajid Safdar, 2CNOffice of Economic Development – Heather Lepeska, 5CSCity Attorney's Office - Barbara Martinez




DEPARTMENT: Housing/Community Services


MAPSCO: 45Q________________________________________________________________

SUBJECT

Authorize a loan in the amount of $2,000,000 at 2% interest to FC Continental Complex, L.P. for the acquisition of property located at 1810 Commerce Street and for conversion of the vacant commercial building into 199 residential rental units and 5,000 square feet of retail space, in accordance with the Downtown Connection Tax Increment Financing District Project Plan & Reinvestment Zone Financing Plan - Not to exceed $2,000,000 - Financing: Downtown Connection Tax Increment Financing District Funds

BACKGROUND

The Downtown Connection Tax Increment Financing District was formed to create a downtown neighborhood with 10,000 plus residents, supporting retail establishments, adequate parks and open space, an attractive employment environment, and a variety of arts venues. The Downtown Connection TIF District was established by Ordinance in June 2005 declaring portions of Downtown/Uptown areas as a “reinvestment zone”, establishing the boundaries of the Downtown Connection TIF District, adopting a preliminary project and financing plan, and establishing a Board of Directors for the District.

The goals of the Downtown Connection TIF District set by the Board of Directors are to improve access between and within the Uptown and Downtown areas; improve the image of the area; support redevelopment of existing building supply; develop a diverse mixture of land uses; increase open space and recreational opportunities; incentivize catalyst projects to increases critical mass of residential, retail and public amenities; facilitate private development within the District for the public purpose of developing and diversifying the economy, eliminating unemployment, and developing or expanding transportation, business and commercial activity in the District.


BACKGROUND (continued)

The Downtown Connection TIF District focuses on catalyst projects to create a greater density and critical mass of development within the Main Street core area. The Downtown Connection TIF District Project Plan identifies environmental remediation, demolition, historic façade restoration, street and utility improvements, streetscape improvements, machinery, equipment, materials and supplies as primary aspects of these projects. The Continental Building at 1810 Commerce Street is listed in the Plan as one of these catalyst projects.

The owner of the Continental Building, FC Continental Complex, L.P., is made up of FC Continental GP, Inc., General Partner and Forest City Residential, Inc., Limited Partner. Forest City Residential Group, Inc. is a wholly-owned subsidiary of Forest City Enterprises, Inc., a publicly traded company that has sponsored The Mercantile Tower and Wilson Building developments in downtown Dallas.

FC Continental Complex, L.P. proposes to convert the vacant commercial building into 199 rental units with ground floor leasing office and fitness room and 5,000 square feet of retail space. The Downtown Connection TIF District Plan budget includes $3,000,000 for affordable housing for households not exceeding 80% Area Median family income as established by the U.S. Department of Housing and Urban Development. The Continental Building will have minimum affordability of 20% of its residential units. This meets the District requirement that ten percent of all housing units assisted with TIF funds must comply with the City of Dallas’ established criteria for affordable housing.

City Council approval of this agenda item from Downtown Connection Tax Increment Financing District funds will provide a loan in the amount of $2,000,000 at 2% interest to FC Continental Complex L.P. for the conversion of a vacant commercial building at 1810 Commerce Street, into 199 rental units and 5,000 square feet of retail space. The site is currently owned by the developer and will be redeveloped in accordance with the Downtown Connection tax Increment Financing District Project Plan.

The FC Continental Complex L.P. loan will carry a two percent interest rate with a fifteen year repayment term. FC Continental Complex L.P. will be required to file deed restrictions and liens on the Continental Building at 1810 Commerce Street in order to assure repayment and housing affordability.


On June 8, 2005, the City Council approved Ordinance Number 26020 establishing the Downtown Connection Tax Increment Financing District declaring portions of the Downtown/Uptown areas as a “reinvestment zone”, establishing the boundaries of the district, adopting a project and financing plan and establishing a Board of Directors for the Downtown Connection TIF District.


PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMMISSIONS) (continued)

On September 22, 2009, the Economic Development Committee was briefed on the Mercantile/Forest City agreement related to the Continental Building, the Tax Increment Financing and the proposed development agreement with FC Continental Complex L.P. for the redevelopment of the Continental Building.

On October 14, 2009, the City Council approved the Supplemental Agreement No. 4 to the development agreement among the City of Dallas, the Downtown Dallas Development Authority, FC Merc Complex, L.P., FC Continental Complex. L.P., FC Atmos, Inc., and FC Lessee pursuant to Resolution No. 09-2518.

On November 2, 2009, the Housing Committee was briefed on the recommended $2,000,000 Downtown Connection TIF District Affordable Housing fund project loan and approved the recommended project loan for full City Council consideration on January 27, 2010.

On January 14, 2010, the Downtown Connection TIF District Board of Directors reviewed and recommended approval by the Dallas City Council of a project loan in the amount of $2,000,000 from Downtown Connection TIF District Affordable Housing funds to FC Continental Complex, L.P for the redevelopment of the Continental Building located at 1810 Commerce Street.

FISCAL INFORMATION

Downtown Connection Tax Increment Financing District Funds - $2,000,000

OWNERS

FC Continental Complex, L.P.Partners: FC Continental GP, Inc., General Partner, Forest City Residential, Inc., Limited Partner

Ron Ratner, President

MAP(S)

Attached

s. ~---

'MAPSCO 45Q

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the Downtown Connection Tax Increment Financing District represents the outgrowth of the City of Dallas’ effort to create a downtown neighborhood with 10,000 plus residents, supporting retail establishments, adequate parks and open space, an attractive employment environment, and a variety of arts venues; and

WHEREAS, the goals of the Downtown Connection TIF District are to improve access between and within the Uptown and Downtown areas; improve the image of the area; support redevelopment of existing building supply; develop a diverse mixture of land uses; increase open space and recreational opportunities; incentivize catalyst projects to increases critical mass of residential, retail and public amenities; facilitate private development within the District for the public purpose of developing and diversifying the economy, eliminating unemployment, and developing or expanding transportation, business and commercial activity in the District; and

WHEREAS, the Downtown Connection TIF District Plan identifies the Continental Building at 1810 Commerce Street as one of the catalyst projects which can create a greater density and critical mass of development within the Main Street core area through environmental remediation, demolition, historic façade restoration, street and utility improvements, and streetscape improvements; and

WHEREAS, on October 14, 2009, the City Council authorized, by Resolution No. 09-2518, the Supplemental Agreement No. 4 to the development agreement among the City of Dallas, the Downtown Dallas Development Authority, FC Merc Complex, L.P., FC Continental Complex. L.P., FC Atmos, Inc., and FC Lessee to increase the required minimum residential units to 180 units and decrease the retail square footage to 5,000 square feet, to adjust the number of parking spaces to 250, to extend the redevelopment completion date to December 31, 2011, add a 20% affordable housing requirement and establish Downtown Connection TIF District funding for project costs in an amount not to exceed $17,528,288; and

WHEREAS, On November 2, 2009, the City Council Housing Committee was briefed on this proposed project loan and approved the proposed project loan in an amount not to exceed $2,000,000 for consideration by the full City Council on January 27, 2010; and

WHEREAS, on January 14, 2010, the Downtown Connection TIF District Board of Directors reviewed and recommended approval by the Dallas City Council of a project loan in the amount of $2,000,000 from Downtown Connection TIF District Affordable Housing funds to FC Continental Complex, L.P for the redevelopment of the Continental Building located at 1810 Commerce Street; and

COUNCIL CHAMBER

January 27, 2010

WHEREAS, The City of Dallas desires to enter into a loan agreement with FC Continental Complex, L.P. in the amount of $2,000,000 at 2% interest with the proceeds to be used for the redevelopment of the vacant 380,000 square foot Continental Building at 1810 Commerce Street into 199 rental units with 20% of the units being affordable to families of 80% or less Area Median Family Income as established by the U.S. Department of Housing and Urban Development; and 5,000 square feet of retail space; NOW, THEREFORE,


Section 1. That the City Manager or designee, upon approval as to form by the City Attorney, is hereby authorized to execute loan documents for the City’s loan in the amount of $2,000,000 at 2% interest to FC Continental Complex, L.P. (“Borrower”). Loan funds may be used for the conversion of the existing vacant commercial building at 1810 Commerce Street, Dallas, Texas into a mixed-use residential project including 199 rental units and 5,000 square feet of retail space.

Section 2. That some of the terms of the loan documents include:

a. Borrower’s note payable to the City of Dallas will have a maturity date of fifteen (15) years. Interest at 2% will accrue for 5 years with no payments made and annual payments totaling $40,000 will be made from 2016 through 2025.

b. To be considered “redeveloped,” the property must be converted and completed for residential and retail space, as evidenced by a certificate of occupancy having been obtained from the City of Dallas for each unit in the structure.

c. Borrower shall execute deed restrictions and a subordinate lien deed of trust on the property at 1810 Commerce Street.

d. Borrower will repay the City of Dallas in full by the maturity date of fifteen (15) years.

Section 3. That the City Manager, upon approval as to form by the City Attorney, is authorized to execute a subordination of lien to a lender who is providing interim construction financing on the property, if necessary.

Section 4. That the City Manager, upon approval as to form by the City Attorney, is authorized to execute lien releases of liens and terminate deed restrictions on the properties upon compliance with the terms.

COUNCIL CHAMBER

January 27, 2010

Section 5. That the Controller is hereby authorized to encumber and disburse funds in accordance with the terms and conditions of the contracts as follows:

FC Continental Complex, L.P. Vendor # VS0000049374

Fund 0044, Dept ECO, Unit P305, Obj 3015, Act. DTTI, CT ECOP305D071 - in an amount not to exceed $2,000,000

Section 6. That nothing in this resolution shall be construed as a binding contract or agreement upon the City, that it is subject to available bond funding, and there will be no liability or obligation on the City until final contract documents are approved, executed, and final closing completed.

Section 7. That this resolution shall take effect immediately from and after its passage in accordance with the Charter of the City of Dallas, and it is accordingly so resolved.

DISTRIBUTION:

Housing DepartmentCity Attorney's OfficeOffice of Financial Services/Community Development, 4FN

REVISED AGENDA ITEM # 6KEY FOCUS AREA: Make Government More Efficient, Effective and Economical


COUNCIL DISTRICT(S): All

DEPARTMENT: Business Development & Procurement Services


MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize a service contract for the purchase and installation of furniture to complete the renovation of the Children's Center and shipping and receiving area for the inter-library loan at the J. Erik Jonsson Central Library - Intelligent Interiors, Inc. in the amount of $106,262, Putsi, Inc. dba Cultural Surroundings in the amount of $47,691, BKM Total Office of Texas, LLC. in the amount of $24,177 and Wilson Project Management in the amount of $7,519, lowest responsible bidders of ten - Total not to exceed $185,649 - Financing: 2003 Bond Funds ($137,958 $138,814) and 2006 Bond Funds ($47,691$46,835)

BACKGROUND

This service contract will allow for the purchase and installation of furniture to be used in the renovation of the J. Erik Jonsson Library at 1515 Young Street, originally constructed in 1982. Each level of this facility is being renovated in phases in order to respond to patron and employee needs, department changes, and advancements in technology. The current renovation phase includes the processing, shipping, and receiving center for the entire Dallas Public Library system located on the L1 level and the children’s area on the second floor.

The 60,000 square foot L1 Level has not been modified in 28 years and will be completely renovated to improve the efficiency of processing library materials. As part of this renovation new ergonomically designed furniture will be installed to provide additional functionality.

In 1989, the Children's Center was moved from the 3rd floor to the 2nd floor. The Children's Center will be expanded to approximately 26,000 square feet and completely renovated to create an advanced learning environment. Additionally new furniture will be required to accommodate this renovation to the Children's Center.

tonya.turner

Underline



As part of the solicitation process and in an effort to increase competition, Business Development and Procurement Services (BDPS) used its procurement system to send out 644 email bid notifications to vendors registered under respective commodities. To further increase competition, BDPS uses historical solicitation information, the internet, and vendor contact information obtained from user departments to contact additional vendors by phone. Additionally, in an effort to secure more bids, notifications were sent by the BDPS’ ResourceLINK Team (RLT) to 25 chambers of commerce, the DFW Minority Business Council and the Women’s Business Council – Southwest, to ensure maximum vendor outreach.



FISCAL INFORMATION

$137,958.00 $138,814.00 - 2003 Bond Funds$ 47,691.00 $ 46,835.00 - 2006 Bond Funds

M/WBE INFORMATION

136 - Vendors contacted134 - No response 2 - Response (Bid) 0 - Response (No Bid) 2 - Successful

644 - M/WBE and Non-M/WBE vendors were contacted

The recommended awardees have fulfilled the requirements set forth in the Business Inclusion and Development (BID) Plan adopted by Council Resolution No. 08-2826 as amended.

ETHNIC COMPOSITION

Intelligent Interiors, Inc.



ETHNIC COMPOSITION (Continued)

Putsi, Inc. dba Cultural Surroundings


BKM Total Office of Texas, LLC.


Wilson Project Management


BID INFORMATION

The following bids were received from solicitation number BS1001 and opened on October 29, 2009. This master agreement is being awarded to the lowest responsive and responsible bidders by group. Information related to this solicitation is available upon request.

*Denotes successful bidders

Bidders Address Amount

*Intelligent Interiors, Inc. 16837 Addison Rd. Multiple GroupsSuite 500Addison, TX 75001

*Putsi, Inc. 5600 W. Lovers Ln. Multiple Groupsdba Cultural Surroundings Suite 116, PMB 393

Dallas, TX 75209

*BKM Total Office of 9755 Clifford Dr., #100 Multiple GroupsTexas, LLC. Dallas, TX 75220


BID INFORMATION (Continued)

Bidders Address Amount

*Wilson Project 1444 Oak Lawn Ave. Multiple GroupsManagement Suite 545B

Dallas, TX 75207

Bauhaus Interiors 1444 Oak Lawn Ave. Multiple GroupsGroup, Inc. Suite 705

Dallas, TX 75207

Facility Interiors, Inc. 5051 Pulaski St. Multiple GroupsDallas, TX 75247

Furniture by William Webb 2130 Kings Rd. Multiple GroupsCarrollton, TX 75007

G.L. Seaman & Company 4201 International Pkwy. Multiple GroupsCarrollton, TX 75007

Lone Star Office 8600 Cameron Loop Multiple GroupsProducts Austin, TX 78745

OP Ventures of 2941 Trade Center Dr. Multiple GroupsTexas, Inc. Suite 120

Carrollton, TX 75007

OWNERS

Intelligent Interiors, Inc.

Mindy Marie Casas, PresidentKraig Wellshear, Vice President/Treasurer

Putsi, Inc. dba Cultural Surroundings

Nicole McKenzie, PresidentPaula Wenstrom, Vice President


OWNERS (Continued)

BKM Total Office of Texas, LLC.

Carol Roehrig, PresidentCarlene Wilson, Vice President

Wilson Project Management

Brooke Blomstrom, President


PROJECT: Authorize a service contract for the purchase and installation of furniture to complete the renovation of the Children's Center and shipping and receiving area for the inter-library loan at the J. Erik Jonsson Central Library – Intelligent Interiors, Inc. in the amount of $106,262, Putsi, Inc. dba Cultural Surroundings in the amount of $47,691, BKM Total Office of Texas, LLC. in the amount of $24,177 and Wilson Project Management in the amount of $7,519, lowest responsible bidders of ten - Total not to exceed $185,649 - Financing: 2003 Bond Funds ($137,958 $138,814) and 2006 Bond Funds ($47,691 $46,835)

Intelligent Interiors, Inc. is a local, minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use the following sub-contractor. BKM Total Office of Texas, LLC. is a local, minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use their own workforce. Putsi, Inc. dba Cultural Surroundings and Wilson Project Management are local, non-minority firms, have signed the "Business Inclusion & Development" documentation, and propose to use their own workforces. PROJECT CATEGORY: Goods

_______________________________________________________________


Amount Percent

Total local contracts $180,849.00 97.41%Total non-local contracts $4,800.00 2.59%

------------------------ ------------------------

TOTAL CONTRACTS $185,649.00 100.00%




Intelligent Interiors, Inc.BKM Total Office of Texas, LLC.

HFWB39767Y0110WFWB42767Y1010

$101,462.00$24,177.00

56.10%13.37%

------------------------ ------------------------




TX Office Installation Services, Inc. PFDB3983BY0110 $4,800.00 100.00%------------------------ ------------------------




African American $0.00 0.00% $0.00 0.00%Hispanic American $101,462.00 56.10% $101,462.00 54.65%Asian American $0.00 0.00% $4,800.00 2.59%Native American $0.00 0.00% $0.00 0.00%WBE $24,177.00 13.37% $24,177.00 13.02%

---------------------- ---------------------- ---------------------- -----------------------

Total $125,639.00 69.47% $130,439.00 70.26%

COUNCIL CHAMBER

January 27, 2010


Section 1. That the City Manager is authorized to execute a service contract with Intelligent Interiors, Inc. (350273) in the amount of $106,262.00, Putsi, Inc. dba Cultural Surroundings (514346) in the amount of $47,691.00, BKM Total Office of Texas, LLC. (115399) in the amount of $24,177.00 and Wilson Project Management (VS0000050008) in the amount of $7,519.00 for the purchase and installation of furniture to complete the renovation of the Children's Center and shipping and receiving area for the inter-loan library at J. Erik Jonsson Central Library in a total amount not to exceed $185,649.00, upon approval as to form by the City Attorney. If the service was bid or proposed on an as needed, unit price basis for performance of specified tasks, payment to Intelligent Interiors, Inc., Putsi, Inc. dba Cultural Surroundings, BKM Total Office of Texas, LLC., or Wilson Project Management shall be based only on the amount of the services directed to be performed by the City and properly performed by Intelligent Interiors, Inc., Putsi, Inc. dba Cultural Surroundings, BKM Total Office of Texas, LLC., or Wilson Project Management under the contract.

Section 2. The City Controller is authorized to disburse funds in an amount not to exceed $185,649.00:

FUND DEPT UNIT OBJ ENCUMBRANCE AMOUNT6T42 EBS T659 2710 EBS10T659CT13 $47,691.003R42 EBS R662 2710 EBS10T659CT10 $7,519.003R42 EBS R662 2710 EBS10T659CT11 $24,177.003R42 EBS R662 2710 EBS10R662CT12 $106,262.00

6T42 EBS T659 2710 EBS10T659CT10 $24,177.006T42 EBS T659 2710 EBS10T657CT11 $7,519.003R42 EBS R662 2710 EBS10R662CT12 $106,262.006T42 EBS T659 2710 EBS10T769CT13 $15,139.003R42 EBS R662 2710 EBS10T659CT13 $32,552.00

Section 3. That this resolution shall take effect immediately from and after its passage in accordance with the provisions of the City Charter of the City of Dallas and it is accordingly so resolved.

DISTRIBUTION:

Business Development and Procurement Services, 3FNOffice of Financial Services, 4FNEquipment & Building Services, 6BNDallas Public Library

REVISED AGENDA ITEM # 32KEY FOCUS AREA: Public Safety Improvements and Crime Reduction


COUNCIL DISTRICT(S): Outside City Limits



MAPSCO: 21A-K P 31K________________________________________________________________

SUBJECT

A resolution authorizing the conveyance of a total of approximately 126,3689 square feet of land to the State of Texas located at Dallas/Fort Worth International Airport near the intersections of State Highway 183 and Valley View Lane and State Highway Business 114 and Dallas Road in exchange for the dedication of a total of approximately 126,368129,156 square feet of land located near the intersections of North Belt Line Beltline Road and State Highway 161 and State Highway 360 and FAA Boulevard from the State of Texas – Financing: No cost consideration to the City

BACKGROUND

This item authorizes the conveyance of a total of approximately 126,3689 square feet of land to the State of Texas located at the Dallas/Fort Worth International Airport (Airport) in exchange for the dedication of 126,368129,156 square feet of land needed to maintain the Airport's land mass as depicted in the current layout plan. The State of Texas desires to acquire Airport property to improve the north access road of State Highway 183 between Valley View Lane and International Parkway and widen the right-of-way of State Highway Business 114 near Dallas Road. The additional right-of-way required by the State of Texas will improve safety for citizens utilizing the roadway systems. Presently the roadways are not sufficient to meet current traffic demands.

The Airport property will be conveyed with a reservation of all oil, gas and other minerals in and under the property. The City may sell or exchange its property to a governmental entity that has the power of eminent domain without complying with the notice and bid requirements pursuant to Chapter 272 of the Texas Local Government Code.



On February 3, 2005, the Dallas/Fort Worth International Airport Board authorized the land exchanges by Resolution Nos. 2005-02-059 and 2005-02-060.

FISCAL INFORMATION


MAPS

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No.: 745

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COUNCIL CHAMBER

January 27, 2010

WHEREAS, the Cities of Dallas and Fort Worth jointly own approximately 18,000 acres of property known as the Dallas/Fort Worth International Airport (the “Airport”); and

WHEREAS, the Cities of Dallas and Fort Worth have created a “joint board” pursuant to Section 22.074 of the Texas Transportation Code, as amended, known as the Dallas/Fort Worth International Airport Board (the “Board”) to operate and set and establish policies for the Airport; and

WHEREAS, on February 3, 2005 by Resolution Nos. 2005-02-059 and 2005-02-060, the Board approved the conveyance of a total of approximately 126,3689 square feet of land to the State of Texas in exchange for the dedication of a total of approximately 126,368129,156 square feet of land located in Dallas and Tarrant Counties; and

WHEREAS, the State of Texas desires to acquire a total of approximately 126,3689 square feet of land to improve the north access road of State Highway 183 between Valley View Lane and International Parkway and to improve the right-of-way width of State Highway Business 114 near Dallas Road; and

WHEREAS, in exchange for Airport property, the State of Texas will convey a total of approximately 126,368129,156 square feet of land to the Cities of Dallas and Fort Worth for the benefit of the Airport; and

WHEREAS, the City of Dallas may sell or exchange its property to a governmental entity that has the power of eminent domain for fair market value as determined by an appraisal without complying with the notice and bidding requirements for the sale of public lands provided for in Section 272.001 of the Texas Local Government Code; and

WHEREAS, certain provisions of Section 2-24 of the Dallas City Code do not apply to the sale of land by the City of Dallas to other governmental entities as contemplated and authorized herein; Now Therefore,


SECTION 1. That the City Manager is authorized to execute deeds without warranty to the State of Texas (“GRANTEE”) for a total of approximately 126,3689 square feet of land located in Dallas and Tarrant Counties, Texas, to be attested by the City Secretary, upon approval as to form by the City Attorney.

SECTION 2. That if a title policy is desired by the GRANTEE, it shall be at the GRANTEE’s expense and the City of Dallas shall have no obligation with respect to obtaining said title policy or provisions of same.

COUNCIL CHAMBER

January 27, 2010

SECTION 3. That the sale shall be subject to standby fees, taxes and assessments, ifany, by any taxing authority for the year of closing and subsequent years andassessments by any taxing authority for prior years due to changes in land usage orownership, the payment of said standby fees, taxes and assessments being assumedby GRANTEE.

SECTION 4, That the procedures required by Section 2-24 of the Dallas City Code thatare not required by state law concerning the sale of unneeded real property are waivedwith respect to this tract of land.

SECTION 5. That this Resolution shall take effect immediately from and after itspassage, as provided by the Charter of the City of Dallas and it is accordingly soresolved.

APPROVED AS TO FORM:

::~~7f[;;dJ&;;ttom"Assistant City Attorney

REVISED AGENDA ITEM # 33KEY FOCUS AREA: Economic Vibrancy


COUNCIL DISTRICT(S): Outside City Limits



MAPSCO: N/A________________________________________________________________

SUBJECT

A resolution authorizing the City to execute and file deed restrictions on behalf of Dallas/Fort Worth International Airport at the Northwest Cargo area as required by Texas Commission on Environmental Quality Voluntary Clean-up Program - Financing: No cost consideration to the City

BACKGROUND

The Cities of Dallas and Fort Worth are record owners of land at Dallas/Fort Worth International (DFW) Airport. DFW’s Board and the Texas Commission on Environmental Quality (TCEQ) entered into a Voluntary Cleanup Program (VCP) Agreement for the Northwest Cargo area in April June 2002. VCP participants are required to evaluate the environmental condition of the VCP site and to submit an assessment report and Response Action Plan (RAP) to the TCEQ for approval. Dallas Fort Worth International Airport Board (Board) has submitted required reports and proposed action plans for all areas of concern in the Northwest Cargo Area and is in the process of obtaining final approvals from TCEQ and implementing approved plans.

In order for the Board to be in compliance with TCEQ’s required response action plan, the oOwner cCities must file deed restrictions identifying the affected areas and the limitations on the use of those areas. Texas Risk Reduction Program (TRRP) requires the filing of deed restrictions as part of the Board’s implementation plan.



FISCAL INFORMATION



MAPS

Attached

[Outside City limits]

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the Cities of Dallas and Fort Worth, Texas (“Owner Cities”), as record owners of fee title to Dallas/Fort Worth International Airport land, are required to file all deed notices related to airport property;

WHEREAS, by Resolution No. 2004-08-253 2009-04-064, the Dallas Fort Worth International Airport Board (“Board”) authorized the Board’s Chief Executive Officer to approve the use of Texas Risk Reduction Program (TRRP) Standard Remedy B for request the Owner Cities approve and file deed restrictions required by the Texas Commission on Environmental Quality (TCEQ) Texas Risk Reduction Program (TRRP) for cleanup of the Northwest Cargo Area pursuant to the Voluntary Cleanup Program Agreement dated June 11, 2002 with the TCEQ Texas Commission on Environmental Quality (TCEQ);

WHEREAS, the Board has been implementing the response actions outlined in the Response Action Plan (RAP) and placement of institutional controls are required by TRRP that request deed notices to be filed in the appropriate county records to notify future landowners of limitations on the use of the property;

WHEREAS, the Board desires the City of Dallas to execute and file deed restrictions as required by TRRP and TCEQ, and as part of the implementation of institutional controls of the Board RAP;

WHEREAS, under correspondence dated July 24, 2009 letter dated March 15, 2006, the Board requested the Owner Cities to file deed restrictions on behalf of D/FW International Airport for airport property located in the Northwest Cargo Area for the use of Remedy Standard B for Ccleanup pursuant to DFW’s Voluntary Cleanup Program Agreement with TCEQ; and

WHEREAS, the restrictions are required by TCEQ as part of DFW’s Response Action Plan being implemented by the Board pursuant to Resolution No. 2004-08-253 2009-04-064; NOW THEREFORE,


SECTION 1. That the City Manager be and is hereby authorized to execute and file in the appropriate county deed restrictions which satisfy requirements by TCEQ.

SECTION 2. That the deed restrictions for the affected property in the Northwest Cargo Area at D/FW shall:

a) Identify affected areas by metes and bounds descriptions and plat maps;

b) State that the affected property is protected for commercial/industrial use;

c) Notify public of limitations of use of the property;

d) Provide notice of physical control; and

COUNCIL CHAMBER

January 27,2010

e) Identify the location and extent of the Plume Management Zone establishedunder the RAP and describe associated monitoring and maintenancerequirements.

SECTION 3. That the approvals and authorizations contained in this resolution arefurther conditioned upon similar approvals and authorizations by the City Council of FortWorth.

SECTION 4. That this resolution shall take effect immediately from and after itspassage in accordance with the provisions of the Charter of the City of Dallas, and it isaccordingly so resolved.

APPROVED AS TO FORM:THOMAS P. PERKINS, JR., City Attorney

BY, ifWid~Assistant City ~ttorney .

REVISED AGENDA ITEM # 37KEY FOCUS AREA: Better Cultural, Arts and Recreational Amenities


COUNCIL DISTRICT(S): All (Continental Bridge is in District 6)

DEPARTMENT: Trinity Watershed Management


MAPSCO: N/A________________________________________________________________

SUBJECT

Authorize (1) the acceptance of a grant from the Trinity Trust foundation for the design and construction of the Continental Avenue Pedestrian Bridge to be placed in the Continental Avenue Bridge Donation Fund in an amount not to exceed $10,000,000; (2) the City Manager to execute a grant agreement with the Trinity Trust Foundation for reimbursement of costs associated with the design and construction of the Continental Avenue Pedestrian Bridge; (3) establishment of appropriations in the amount of $10,000,000 in the Continental Avenue Bridge Donation Fund; and (4) Supplemental Agreement No. 4 in the amount of $1,335,158 for additional design and project management services for design of the Continental Avenue Pedestrian Bridge to extend the Trinity lakes design for the Trinity River Corridor Project - Total not to exceed $1,335,158, from $20,110,860 to $21,446,018 - Financing: Private Funds ($1,127,000) and 1998 Bond Funds ($208,158)

BACKGROUND

The City Council adopted the Balanced Vision Plan on December 8, 2003 and amended the plan on April 14, 2004. The Trinity Lakes Design contract was awarded to the CH2M Hill team by City Council on November 8, 2006. The original design contract included design guidelines, branding, preparation of the Dallas Floodway, and final design for river relocation from Sylvan Avenue to the DART Bridge. In addition, the original design contract included design work for lake amenities that will be located near downtown in the Dallas Floodway. Public access strategy for the lower half of the Dallas Floodway also included a 20% design for the Reunion Overlook Plaza over the Trinity Parkway and 100% design for the Fast Track overlook for the public to witness the transformation of the Dallas Floodway.

tonya.turner

Underline



Due in part to passage of the Water resources Development Act (WRDA) 2007 authorization for the Dallas Floodway, Supplemental Agreement No. 1 to the Trinity Lakes Design contract was approved by City Council on February 13, 2008. Supplemental Agreement No. 1 extended 100% design of the river alignment, bridge pier design, and utilities design from Sylvan to the Elm Fork / West Fork confluence, and also provided 20% design for this same portion of the Dallas Floodway for the West Dallas Lake, West Dallas playing fields, public access / circulation, softscape and play areas. In addition, Supplemental Agreement No. 1 provided 5% conceptual design for Continental Bridge public use as a pedestrian bridge.

Supplemental Agreement No. 2 to the Trinity Lakes Design contract was approved by City Council on June 25, 2008 to include geotechnical sampling, and surveying to support a Municipal Setting Designation (MSD) for the Dallas Floodway, utilities schematic design for lakes water delivery system, and additional transportation engineering support.

Supplemental Agreement No. 3 to the Trinity Lakes Design contract was approved by City Council on June 10, 2009 to include environmental and archaeological investigations for portions of the West Fork and Elm Fork of the Trinity River that are adjacent to the Dallas Floodway levees. Supplemental Agreement No. 3 also included permit preparation and environmental investigations, subsurface utility engineering, and survey of the existing river channel for the design of four (4) water main replacements. In addition, Supplemental Agreement No. 3 provided technical and review assistance to the U.S. Army Corps of Engineers for their ongoing effort on the Dallas Floodway feasibility study / Environmental Impact Statement. Lastly, Supplemental Agreement No. 3 removed unused special services peer review ($167,895.19) that was originally made part of this design contract and unused survey work that is now unnecessary ($79,104.81), while also transferring $52,910.00 within the overall design contract from CH2M Hill to URS to serve structural analysis. The total fee amount increase for Supplemental Agreement No. 3 to the Trinity lakes Design contract was $587,000.

Supplemental Agreement No. 4 will include design and engineering of the Continental Avenue Pedestrian Bridge. The funding from this supplement was provided through a grant from the Trinity Trust, not to exceed $10,000,000 for design, engineering and construction. CH2MHill currently has designed this bridge to the 5% level and will complete plans and specifications and provide engineering support during construction for the project. The total design fee increase for the Continental Avenue Pedestrian Bridge is $1,127,000, funds to be provided by a grant from the Trinity Trust for Supplement No. 4 to the Trinity Lakes Design contract.



In addition, Supplemental Agreement No. 4 will include $237,000 for design and modeling assistance to the U.S. Army Corps of Engineers for their upcoming plan formulation process that is part of their ongoing preparation of the Dallas Floodway Environmental Impact Statement (EIS). Additionally, the overall design contract with CH2M Hill has several small adjustments that result in an overall reduction of $28,841. Thus, the net design contract increase for this Amendment #4 to serve the Continental Avenue Pedestrian Bridge and support analysis to the U.S. Army Corps of Engineers for their ongoing development of the Environmental Impact Statement for the Dallas Floodway Project is $208,158.

ESTIMATED SCHEDULE OF PROJECTS

Begin Design (Modeling for Corps & Continental Bridge) February 2010Complete Design (Modeling for Corps) August 2010Begin Design (Continental Bridge) March 2011Begin Construction (Continental Ave Pedestrian Bridge) July 2011Complete Construction (Continental Ave Pedestrian Bridge) November 2012


Authorized an Interlocal Agreement with the U.S. Army Corps of Engineers for local participation and cost sharing with the Corps on January 10, 1990, by Resolution No. 90-0225. Authorized Supplemental Agreement No. 1 with the NCTCOG for the Dallas Floodway and Elm Fork detailed study as part of the Upper Trinity River Feasibility Study on June 12, 1996, by Resolution No. 96-2007.

Authorized adoption of the Great Trinity Forest Master Implementation Plan on March 26, 1997, by Resolution No. 97-1066.

Authorized adoption of the Trinity River Corridor Master Implementation Plan on August 25, 1999, by Resolution No. 99-2623.

Authorized a professional services contract with Camp Dresser & McKee, Inc for lake water quality analysis and technical input towards the Balanced Vision Plan on November 13, 2002, by Resolution No. 02-3165.

Authorized adoption of the Balanced Vision Plan for the Dallas Floodway on December 8, 2003, by Resolution No. 03-3391.

Authorized adoption of refinements to the Balanced Vision Plan for the Dallas Floodway on April 14, 2004, by Resolution No. 04-1252.



Authorized adoption of the Trinity Parkway Alternative Alignment 3B on April 13, 2005, by Resolution No. 05-1210.

Authorized Trinity Lakes design contract on November 8, 2006, by Resolution No. 06-3121.

Authorized Trinity Lakes design contract amendment No. 1 on February 13, 2008, by Resolution No. 08-0455.

Authorized Trinity Lakes design contract amendment No. 2 on June 25, 2008, by Resolution No. 08-1902.

Authorized Trinity Lakes design contract amendment No. 3 on June 10, 2009, by Resolution No. 09-1499 on June 10, 2009.

Trinity River Corridor Project Committee was briefed for the Supplemental No. 4 to the Trinity Lakes design contract on November 3, 2009.

FISCAL INFORMATION

Private Funds - $1,127,0001998 Bond Funds $208,158

ETHNIC COMPOSITION

CH2M Hill


M/WBE INFORMATION

See Attached

OWNER

CH2M Hill

Jim Parrish, P.E., Vice-President


MAP

Attached


PROJECT: Authorize (1) the acceptance of a grant from the Trinity Trust foundation for the design and construction of the Continental Avenue Pedestrian Bridge to be placed in the Continental Avenue Bridge Donation Fund in an amount not to exceed $10,000,000; (2) the City Manager to execute a grant agreement with the Trinity Trust Foundation for reimbursement of costs associated with the design and construction of the Continental Avenue Pedestrian Bridge; (3) establishment of appropriations in the amount of $10,000,000 in the Continental Avenue Bridge Donation Fund; and (4) Supplemental Agreement No. 4 in the amount of $1,335,158 for additional design and project management services for design of the Continental Avenue Pedestrian Bridge to extend the Trinity lakes design for the Trinity River Corridor Project - Total not to exceed $1,335,158, from $20,110,860 to $21,446,018 - Financing: Private Funds ($1,127,000) and 1998 Bond Funds ($208,158)

CH2M Hill is a local, non-minority firm, has signed the "Business Inclusion & Development" documentation, and proposes to use the following sub-contractors.

PROJECT CATEGORY: Architecture & Engineering_______________________________________________________________

LOCAL/NON-LOCAL CONTRACT SUMMARY - THIS ACTION ONLY

Amount Percent

Local contracts $695,800.00 52.11%Non-local contracts $639,358.16 47.89%

--------------------------- ---------------------------

TOTAL THIS ACTION $1,335,158.16 100.00%

LOCAL/NON-LOCAL M/WBE PARTICIPATION THIS ACTION



ARS Engineers, Inc.Addula Consulting EngineersCP&Y

IMDB40643Y0410IMDB41963Y0710PMMB42281Y0910

$149,000.00$26,000.00

$134,000.00

21.41%3.74%

19.26%--------------------------- ---------------------------




Foster CM GroupGorrondonna AssociatesGeo-Marine, Inc.Xenco LaboratoriesLeni Schwendinger Light Projects LTD

BMMB42780N1010HMDB40421Y0310HMMB40160Y0210HMMB42100Y0810WFWB2084N0810

$15,000.00$23,000.00($4,670.84)

($10,950.00)$53,000.00

2.35%3.60%

-0.73%-1.71%8.29%

--------------------------- ---------------------------


TOTAL M/WBE PARTICIPATIONThis Action Participation to Date

Amount Percent Amount Percent

African American $15,000.00 1.12% $661,995.83 3.09%Hispanic American $7,379.16 0.55% $6,712,993.74 31.30%Asian American $309,000.00 23.14% $392,380.00 1.83%Native American $0.00 0.00% $0.00 0.00%WBE $53,000.00 3.97% $368,707.00 1.72%

----------------------- ---------------------- --------------------------- ---------------------------

Total $384,379.16 28.79% $8,136,076.57 37.94%

[Lakes Design Contract]

[Mapsco Various1

COUNCIL CHAMBER

January 27, 2010

WHEREAS, the 1998 Bond Program authorized funding to implement flood control, lake development, environmental, transportation, and recreation projects within the Dallas Floodway; and,

WHEREAS, City Council adopted the Balanced Vision Plan on December 8, 2003, by Resolution No. 03-3391, and further adopted refinements on April 14, 2004, by Resolution No. 04-1252; and,

WHEREAS, City Council authorized the Trinity Lakes design contract with CH2M Hill to initiate design for portions of the Balanced Vision Plan for the Dallas Floodway, Trinity River Corridor Project design guidelines, and Trinity Parkway design guidelines on November 8, 2006, by Resolution No. 06-3121; and,

WHEREAS, City Council approved the Trinity Lakes design contract with CH2M Hill to extend design for portions of the Balanced Vision Plan for the Dallas Floodway on February 13, 2008, by Resolution No. 08-0455; and,

WHEREAS, City Council approved the Trinity Lakes design contract with CH2M Hill to extend design for additional geotechnical sampling and surveying for the Dallas Floodway on June 25, 2008, by Resolution No. 08-1902; and,

WHEREAS, City Council approved the Trinity Lakes design contract with CH2M Hill to extend design for additional environmental and archaeological investigations, and assistance to the U.S. Army Corps of Engineers for their ongoing development of the Environmental Impact Statement on June 10, 2009, by Resolution No. 09-1499; and,

WHEREAS, it is now desirable to authorize Supplemental Agreement No. 4 to the contract with CH2M Hill for design services for the Continental Avenue Pedestrian Bridge and further contract with CH2M Hill for support analysis to the U.S. Army Corps of Engineers for their ongoing Environmental Impact Statement for the Dallas Floodway Project; and,

WHEREAS, the Supplemental Agreement No. 4 to the contract with CH2M Hill for the Continental Avenue Pedestrian Bridge ($1,127,000), support analysis to the U.S. Army Corps of Engineers ($237,000), and CH2M Hill contract adjustments (reduction of $28,842) in the amount of $1,335,158 that will increase the design contract from $20,110,860 to $21,446,018; and,

WHEREAS, it is now necessary to accept a grant from the Trinity Trust Foundation for the design and construction of the Continental Avenue Pedestrian Bridge to be placed in the Continental Avenue Pedestrian Bridge Donation fund not to exceed $10,000,000, and,

COUNCIL CHAMBER

January 27, 2010

WHEREAS, it is now necessary to authorize the City Manager or designee to execute a grant agreement with the Trinity Trust to serve design and construction for the Continental Avenue Pedestrian Bridge not to exceed $10,000,000, and

WHEREAS, the U.S. Army Corps of Engineers will recognize portions of this contract with CH2M Hill as in-kind credit for 50% cost sharing of the Upper Trinity River Feasibility Study for the Dallas Floodway that may also reduce future City expenses towards the Corps’ project design, or Corps’ project construction; and,

Now, Therefore,


Section 1. That the City Manager is hereby authorized to execute Supplemental Agreement No. 4 to the contract with CH2M Hill for additional design services to extend the Trinity Lakes design for the Trinity River Corridor Project in an amount not to exceed $1,335,158, from $20,110,860 to $21,446,018.

Section 2. That the City Manager or designee be is hereby authorized to execute this contract for Supplemental Agreement No. 4 with CH2M Hill and the grant agreement with the Trinity Trust after each contract has been approved as to form by the City Attorney.

Section 3. The City Controller is hereby authorized to disburse funds in accordance with the terms and conditions of the contract from:

Trinity River Corridor Project Fund Fund 6P14, Agency PBW, Unit N965, Act. TRPPObject 4111, Job #PB98N965, CT PBW98N963B3Vendor #505225, in an amount not to exceed $208,158

Continental Avenue Pedestrian Bridge Donation Fund Fund P274, Agency TWM, Unit 1086, Act. TRPPObject 4111, Job # PB101086, CT TWM101086D01Vendor #505225, total amount not to exceed $1,127,000

Section 4. That the City Controller is hereby authorized to receive and deposit funds from the Trinity Trust Foundation in an amount not to exceed $10,000,000 in the Continental Avenue Pedestrian Bridge Donation Fund, Agency TWM, Fund P274, Unit 1086, Revenue Source 8411.

Section 5. That the City Manager be and is hereby authorized to establish appropriations in an amount not to exceed $10,000,000 in the Continental Avenue Pedestrian Bridge Donation Fund, Agency TWM, Fund P274, Unit 1086, Object 4111.

COUNCIL CHAMBER

January 27, 2010


Distribution: Trinity River Corridor Project, Natalie Wilson, City Hall, Room 6B/SouthTrinity River Corridor Project, Rebecca Rasor, 6BSCity AttorneyOffice of Financial Services

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