Loading...
2023 04 06 MDD MinutesMINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT April 6, 2023 The Board of Directors of the Baytown Municipal Development District (MDD) met in a Regular Meeting on Thursday, April 6, 2023, at 3:31 P.M., in the Council Chamber of the Baytown City Hall, 2401 Market Street, Baytown, Texas, with the following in attendance: Bandon Capetillo President Laura Alvarado Vice President David P. Jirrels Secretary Donna Winfrey Director Suhey Rios -Alvarez Director Sarah Graham Director Kenrick Griffith Director Heather Betancourth Director Jacob Powell Director Mike Lester Director Gary Englert Director Shaunna Bernshausen Director Jason Reynolds General Manager Scott Lamond General Counsel Angela Jackson Assistant Secretary President Brandon Capetillo convened the April 6, 2023, MDD Board Regular Meeting with a quorum present at 3:31 P.M., all members were present with the exception of Director Suhey Rios -Alvarez who arrived at 3.33 P.M., and Director Sarah Graham who arrived at 3:35 P.M. 1. MINUTES President Capetillo stated that Agenda Items La. and l .b. would be considered together. a. Consider approving the minutes of the Municipal Development District Regular Meeting held on February 2, 2023. b. Consider approving the minutes of the Municipal Development District Regular Meeting held on March 2, 2023. A motion was made by Director Jacob Powell and seconded by Director Mike Lester to approve the minutes of the Municipal Development District Regular Meeting minutes held on February 2, 2023, and March 2, 2023, both as submitted. The vote was as follows: Ayes: President Brandon Capetillo, Vice President Laura Alvarado, Secretary David P. Jirrels, Director Donna Winfrey, Director Kenrick Griffith, Director Heather MDD Board Regular Meeting Minutes April 6, 2023 Page 2 of 6 Betancourth, Director Jacob Powell, Director Gary Englert, Director Mike Lester, and Director Shaunna Bernshausen Nays: None Other: Director Suhey Rios -Alvarez (Not Present for Vote) and Director Sarah Graham (Not Present for Vote) Approved 2. PROPOSED RESOLUTIONS a. Consider a resolution approving revisions to the Business Improvement Grant program policy and guidelines. General Manager Jason Reynolds opened Agenda Item 2.a., and offered to discuss vacant properties that the City of Baytown held. He stated that placing those vacant properties could be included in the program, or Staff could create a separate program for those vacant properties. President Capetillo suggested that be discussed at a later date and directed Staff to provide an update of what had transpired to date. Planning and Development Director Martin Scribner then presented an overview of the changes that were discussed by the Board at their February 2, 2023, and March 2, 2023, board meetings. The goal of the proposed amendments was to foster the redevelopment of distressed areas of Baytown in need of economic investment and redevelopment. Staff believed that the proposed amendments captured the spirit and intent of the Board and would benefit the business community of Baytown. Lastly, Mr. Scribner shared that Staff was still exploring the upfront funding options. Their initial meetings with a potential financial institution had been fruitful thus far, and Staff hoped to have that information before the Board in the near future. Director Suhey Rios -Alvarez wondered if a business owner did their improvements but did not follow the guidelines for a timeline submittal. Would they still be able to qualify for reimbursement? Mr. Scribner responded that the new changes had extended the timeline for them to apply. If it were outside of the timeline prescribed, they would not meet the requirements. A motion was made by Vice President Laura Alvarado, and seconded by Director Sarah Graham to approve Resolution No. 459, related to Item 2.a. The vote was as follows: Ayes: President Brandon Capetillo, Vice President Laura Alvarado, Secretary David P. Jirrels, Director Donna Winfrey, Director Suhey Rios -Alvarez, Director Sarah Graham, Director Kenrick Griffith, Director Heather Betancourth, Director Jacob Powell, Director Gary Englert, Director Mike Lester, Director Shaunna Bernshausen Nays: None Approved MDD Board Regular Meeting Minutes April 6, 2023 Page 3 of 6 RESOLUTION NO. 459 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT APPROVING REVISIONS TO THE BUSINESS IMPROVEMENT GRANT PROGRAM POLICY AND GUIDELINES; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. b. Consider a resolution approving the final adjusted Development Budget and approving the Final Guaranteed Maximum Price (FGMP) for the Hotel and Convention Center. Finance Director Victor Brownlees presented Agenda Item 2.b. The Municipal Development District (MDD) previously approved the construction of a new Hotel and Convention Center, which was expected to be a significant economic driver for the community. As part of the construction process, the MDD agreed to an overall Development Budget. However, unforeseen circumstances arose during the construction process. Those circumstances consisted of cost escalations on budgeted items and additional expenses that were not included in the original budget. Consequently, the MDD needed to adjust the Development Budget. The proposed adjustment to the Development Budget would require additional funding from within the MDD's general budget. The total amount requested for the budget adjustment was $1,060,000.00, which would be allocated from the uncommitted funds from within the MDD. The adjustment was necessary to complete the Hotel and Convention Center project. The resolution authorized the MDD to do the following: 1. Approve the final adjusted Development Budget; 2. Approve the Final Guaranteed Maximum Price (FGMP); and 3. Transfer $1,060,000.00 from within the uncommitted funds from the MDD general budget. President Capetillo understood there had been money set aside for what was being discussed. Mr. Brownlees confirmed contingency was already provided for within the bond trust, but it was not initially allocated in the Development Budget. He assured it was now allocated with the amendment in addition to the uncommitted funds in the MDD's current year budget. Director Griffith wondered, if not used as discussed, where would the funds normally go towards? Mr. Brownlees responded the $720,000 of those funds were uncommitted and would roll over in to the next year's budget. The remainder, of about $350,000, was already budgeted for projects. Secretary Jirrels expressed concern with approving an extra million dollars when they approved an extra six million dollars last year. Mr. Brownlees shared that concern; however, the alternative was litigation which he did not advise. Upon addressing additional concerns, Mr. Brownlees explained matters regarding the FGMP. The City of Baytown, the owner, had also acquired additional works and there were other allowances within the contract that the City accepted they owed the contractor. Mr. Brownlees clarified the City would not pay a penny more to anyone who would not merit it based on their contracts. After the amendment, they were done. MDD Board Regular Meeting Minutes April 6, 2023 Page 4 of 6 Director Lester asked what projects would be affected by the change. Mr. Brownlees anticipated the majority would come from the Disc Golf Course. However, the change would not stop any project on the list. They were merely using the funds that were uncommitted in the current year to get them over this last bump in the road. The projects would appear on the list next year in the MDD's budget before they allocated any other funds. Upon further questioning, Mr. Brownlees reiterated there were no projects they would not do as a result of the commitment of funds. Director Graham expressed she felt placed between a rock and a hard place. Normally, she would not approve that kind of money but she did not want to see an empty building that they had been anticipating opening. She was disappointed there were projects that would be put on hold or slowed down. Director Winfrey then inquired over what amount the budget would be replenished at. Mr. Brownlees replied, in looking at next year's budget, they would make estimates of the overall sales tax funds available to the MDD. He noted there were some commitments they already knew about, such as debt repayments, and the remainder would be available to commit to projects. He anticipated that amount would be no more than $2 million. President Capetillo commented the adjustment was only 1 % of the entire budget and that was because they wanted a higher end hotel. Thus, he encouraged the Board to consider the item. A motion was made by Vice President Laura Alvarado and seconded by Director Donna Winfrey to approve Resolution No. 460, related to Item 2.b. The vote was as follows: Ayes: President Brandon Capetillo, Vice President Laura Alvarado, Director Donna Winfrey, Director Suhey Rios -Alvarez, Director Sarah Graham, Director Kenrick Griffith, Director Jacob Powell, Director Mike Lester, Director Gary Englert, and Director Shaunna Bernshausen Nays: Secretary David P. Jirrels and Director Heather Betancourth Approved RESOLUTION NO. 460 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT APPROVING THE FINAL ADJUSTED DEVELOPMENT BUDGET, A FINAL GUARANTEED MAXIMUM PRICE OF SIXTY-ONE MILLION, THREE -HUNDRED, SIXTEEN THOUSAND, NINE -HUNDRED SEVENTY-SEVEN AND NO/100 ($61,316,977.00), AND OTHER MATTERS RELATED TO THE CONVENTION CENTER HOTEL PROJECT. C. Consider a resolution approving the operating and asset management budget for the Hotel and Convention Center. Finance Director Victor Brownlees opened Agenda Item 2.c. The proposed resolution would approve the operating and asset management budget for the Hotel and Convention Center. The MDD Board Regular Meeting Minutes April 6, 2023 Page 5 of 6 operating budget detailed the projected income and expenses for the hotel over the coming year. It also took in to account the various revenue streams and costs associated with running a high - quality hospitality establishment. Staff worked diligently to ensure the budget was both realistic and fiscally responsible while also providing necessary investments in Staff training, equipment upgrades, and other areas that would help maintain the highest possible standards for guests. The asset management budget, meanwhile, outlined the plans for maintaining and improving the physical infrastructure of the hotel. This included ongoing maintenance tasks such as repairs, cleaning, and landscaping. It also included larger -scale capital investments in areas such as building renovations, energy -efficient upgrades, and technology systems. By investing in those areas, they hoped to not only enhance the guest experience but also ensure the hotel remained a valuable asset for the City for years to come. Vice President Alvarado wondered if increases had been foreseen. Hotel Asset Manager with Garfield Asset Management Jeff Binford replied the resolution was for the operating budget of the hotel and not the construction. Nevertheless, they anticipated losses and provided funds in the bond sale to cover the early years. He clarified they were not asking for money, but for the approval of the budget for the fiscal year ending September 301n A motion was made by Vice President Laura Alvarado and seconded by Director Mike Lester to approve Resolution No. 461, related to Item 2.c. The vote was as follows: Ayes: President Brandon Capetillo, Vice President Laura Alvarado, Secretary David P. Jirrels, Director Donna Winfrey, Director Suhey Rios -Alvarez, Director Sarah Graham, Director Kenrick Griffith, Director Heather Betancourth, Director Jacob Powell, Director Gary Englert, Director Mike Lester, and Director Shaunna Bernshausen Nays: None Approved RESOLUTION NO.461 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT APPROVING THE OPERATING AND ASSET MANAGEMENT BUDGET FOR THE BAYTOWN HOTEL AND CONVENTION CENTER; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. 3. REPORTS a. Receive the Monthly Construction Status Report for the Baytown Hotel and Convention Center Project. Finance Director Victor Brownless stated he had nothing further to add and implored the Board Members to attend the tour of the Baytown Hotel and Convention Center. MDD Board Regular Meeting Minutes April 6, 2023 Page 6 of 6 4. MANAGER'S REPORT a. The next Baytown Municipal Development District meeting is scheduled for Thursday, May 4, 2023, at 4:30 p.m., in the Council Chamber located at City Hall, 2401 Market Street, Baytown, Texas, 77520. General Manager Jason Reynolds had nothing further to report other than the date of their next scheduled meeting. President Capetillo recited that date to be Thursday, May 4, 2023, at 4:30 P.M. The meeting is to be located in the Council Chamber at City Hall, as expected. 5. HYATT REGENCY BAYTOWN - HOUSTON HOTEL TOUR a. The Baytown Municipal Development District will tour the new facility of the Hyatt Regency Baytown - Houston located at 100 Convention Center Way, Baytown, Texas. At 3:58 P.M., President Capetillo recessed the meeting for the Board Members to travel and tour the new facility of the Hyatt Regency Baytown. At 4:21 P.M., President Capetillo reconvened the meeting at the Hyatt Regency Baytown located at 100 Convention Center Way, Baytown, Texas, once a quorum was reached. Hotel Asset Manager with Garfield Asset Management Jeff Binford provided the Baytown Municipal Development District (MDD) Directors with a tour of the new Hyatt Regency facility. 6. ADJOURN With there being no further business to discuss, President Brandon Capetillo adjourned the April 6, 2023, MDD Board Regular Meeting at 4:54 P.M. Angela Jakson, Assistant Sat,3 City of Baytown "{ ��„unm