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2023 11 02 MDD Minutes MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT November 2, 2023 The Board of Directors of the Baytown Municipal Development District (MDD) met in a Regular Meeting on Thursday, November 2, 2023, at 4:45 P.M., in the Council Chamber of the Baytown City Hall, 2401 Market Street, Baytown, Texas with the following in attendance: Laura Alvarado Vice President Sarah Graham Director Kenrick Griffith Director Jacob Powell Director Jason Reynolds General Manager Scott Lamond General Counsel Angela Jackson Assistant Secretary Vice President Laura Alvarado convened the November 2, 2023, MDD Board Regular Meeting with a quorum present at 4:45 P.M., all members were present with the exception of President Brandon Capetillo, and Directors Heather Betancourth and Mike Lester, who were absent. 1. EXECUTIVE SESSION a. Recess into and conduct an executive session pursuant to Section(s) 551.071 and/or 551.087 of the Texas Government Code to seek the advice of the City's attorneys and/or to discuss economic development negotiations. At 4:46 P.M., Vice President Laura Alvarado recessed into and conducted an executive session pursuant to Section(s) 551.071 and or 551.087 of the Texas Government Code to seek the advice of the City's attorneys and or to discuss economic development negotiations. At 5:26 P.M., Vice President Laura Alvarado reconvened the Open Meeting of the MDD Board Regular Meeting and announced that in accordance with Section 551.102 of the Texas Government Code, no action was taken in the Executive Session. 2. MINUTES a. Consider approving the minutes of the Municipal Development District Regular Meeting held on September 14, 2023. A motion was made by Director Sarah Graham, and seconded by Director Kenrick Griffith to approve the meeting minutes of the Municipal Development District Regular Meetings held on September 14, 2023, as submitted. The vote was as follows: Ayes: Vice President Laura Alvarado, Director Sarah Graham, Director Kenrick Griffith, Director Jacob Powell MDD Board Regular Meeting Minutes November 2,2023 Page 2 of 5 Nays: None Other: President Brandon Capetillo (Absent), Director Heather Betancourth (Absent), Director Mike Lester(Absent) Approved 3. CITIZEN COMMENTS Vice President Laura Alvarado announced no citizen had signed up to speak on the Citizen Comments item. 4. REPORTS a. Receive the 2024 Fiscal Year Operating Budget for the Hyatt Regency Baytown- Houston. General Manager Jason Reynolds presented the 2024 Fiscal Year Operating Budget for the Hyatt Regency Baytown-Houston and stated that the report will be brief due to confidential and proprietary information that is involved with the budget and presented the following financial report: 2024 Fiscal Year Operating Budget Required Working Capital $(5,077,202) $ (15,441,112) MDD—Capital Contribution $ 1,782,361 $ 1,800,000 Hyatt Revenue to the City $ 1,667,099 $ 12,852,856 Amount Due $ (1,627,742) $ (788,256) Further, Mr. Reynolds noted that there is a Working Capital Fund that has a large Capital Contribution of the City's revenue which they receive from the Hyatt room and Convention Center sales, that pays into the $1.6 million negative balance that is on the budget for Fiscal Year 2023. This information was made known to the Board when the proposal was put into place stating there would be a negative balance which would need to be addressed, as it would take a year or two for the Hotel to get established with its customer base. Further, Mr. Reynolds noted they are seeing progress with the Hotel and that the Working Capital Reserve Fund, which is there to pay this $1.6 million for Fiscal Year 2023, is covering this balance in full and reiterated MDD Board Regular Meeting Minutes November 2,2023 Page 3 of 5 there is not a transfer from the General Fund or any other transfer outside of the $1.782 million for the insurance and etc., to cover this balance. Additionally, Mr. Reynolds stated for Fiscal Year 2024 it will cost $15.4 million to operate the Hotel and they have budgeted 1.8 million for the insurance cost for the Hyatt from MDD. He also noted Staff is working diligently with Hyatt, Garfield, and outside entities to increase the insurance cost. The Hyatt's revenue is projected in budget at $12.8 million and this revenue would come directly into the City to offset the required Working Capital. Currently, there is a projected deficit of$700,088, and the Working Capital Fund for Fiscal Year 2023 would carry over and would have enough to cover this balance. Lastly, Mr. Reynolds reiterated that there is no projection at this time to use the General Fund or any additional Capital Contribution of the MDD, with the exception for the cost that is budgeted for insurance. However, if something should come up, the Board would be updated on a quarterly basis on the financial status of the Hotel and at this point, the projection is that the Hotel will be self-sustaining. Mr. Reynold's concluded his presentation by offering any questions from the Board. General Counsel Scott Lemond provided clarification to the Board as it relates to confidential and pituitary information and stated with Economic Development matters, Staff will sometimes receive inside information that is private to the entity itself(Hyatt Regency) and not subject to disclosure. There being no further comments or questions, Vice President Alvarado called for a motion to receive the 2024 Fiscal Year budget for the Hyatt Regency. A motion was made by Director Sarah Graham, and seconded by Director Kenrick Griffith to receive the Hyatt Regency Baytown-Houston 2024 Fiscal Year Operating Budget Report. Ayes: Vice President Laura Alvarado, Director Sarah Graham, Director Kenrick Griffith, Director Jacob Powell Nays: None Other: President Brandon Capetillo (Absent), Director Heather Betancourth (Absent), Director Mike Lester(Absent) Approved 5. PROPOSED RESOLUTIONS a. Consider a resolution adopting the 2024 Fiscal Year Operating Budget for the Hyatt Regency Baytown-Houston. General Manager Jason Reynolds stated this item is the Budget as presented in the previous Agenda Item 4.a. A motion was made by Director Sarah Graham, and seconded by Director Jacob Powell to approve Resolution No. 469, related to Item 5.a. The vote was as follows: Ayes: Vice President Laura Alvarado, Director Sarah Graham, Director Kenrick Griffith, Director Jacob Powell MDD Board Regular Meeting Minutes November 2,2023 Page 4 of 5 Nays: None Other: President Brandon Capetillo (Absent), Director Heather Betancourth (Absent), Director Mike Lester(Absent) Approved RESOLUTION NO.469 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT ADOPTING THE HYATT REGENCY BAYTOWN-HOUSTON BUDGET FOR THE 2024 FISCAL YEAR; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. b. Consider a resolution approving a Business Improvement Grant application not to exceed $25,000.00. Senior Economic Development Analyst Emilio Levario presented Agenda Item 4.b. and stated Resolution No. 470 authorizes reimbursement funding to be awarded under the Business Improvement Grant, per the guidelines of the grant in an amount not to exceed $25,000.00. The applicant, Damian Distribute LLC, is the property owner of 6300 Bayway Drive, which is located in the BIG program area. Further, Mr. Levario stated that the company is seeking a business improvement grant as part of their efforts to enhance the outdoor aesthetics of the site and the property is currently in use as a self-storage facility which will continue to operate as such. Director Kenrick Griffith voiced his support of this item as the Bayway corridor could use some revitalization and this improvement would serve the Community well. Further, Vice President Laura Alvarado thanked the applicant for their interest in improving the area. A motion was made by Director Kenrick Griffith, and seconded by Director Sarah Graham to approve Resolution No. 470, related to Item 5.b. The vote was as follows: Ayes: Vice President Laura Alvarado, Director Sarah Graham, Director Kenrick Griffith, Director Jacob Powell Nays: None Other: President Brandon Capetillo (Absent), Director Heather Betancourth (Absent), Director Mike Lester(Absent) Approved RESOLUTION NO.470 MDD Board Regular Meeting Minutes November 2,2023 Page 5 of 5 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT APPROVING A BUSINESS IMPROVEMENT GRANT APPLICATION SUBMITTED BY DAMIAN DISTRIBUTE LLC; AUTHORIZING REIMBURSEMENT FUNDING UNDER THE BUSINESS IMPROVEMENT GRANT PROGRAM IN AN AMOUNT NOT TO EXCEED TWENTY-FIVE THOUSAND AND NO 100 DOLLARS ($25,000.00), AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. 6. MANAGER'S REPORT General Manager Jason Reynolds stated he had nothing to present for this item. 7. ADJOURN With there being no further business to discuss, Vice President Laura Alvarado adjourned the November 2, 2023, MDD Board Regular Meeting at 5:38 P.M. 0 Z*-4 _Aj Angela J so!, 4s ' eta City of Baytov"