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2012 01 05 MDD MinutesMINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT January 05, 2012 The Board of Directors of the Baytown Municipal Development District (MDD) met in a Regular Meeting on Thursday, January 05, 2012, at 4:30 P.M., in the Council Chamber of the Baytown City Hall, 2401 Market Street, Baytown, Texas with the following in attendance: Stephen DonCarlos Scott Sheley Reggie Brewer Brandon Capetillo Robert Hoskins Mary Hernandez Dee Anne Navarre Terry Sain President Vice President Secretary Director Director Director Director Director Robert D. Leiper General Manager Kevin Troller Assistant General Manager Ignacio Ramirez, Sr. General Counsel Leticia Brysch Assistant Secretary President DonCarlos convened the January 05, 2012, Municipal Development District (MDD) Board Regular Meeting with a quorum present at 4:30 P.M., all members were present with the exception of Council Member Hernandez who arrived at 4:35 P.M. and Council Members Linares, McCartney, and Renteria who were absent. 1. MINUTES a. Consider Approving the Minutes of the Municipal Development District (MDD) Board Regular Meeting held on December 01, 2011 - Assistant Secretary. A motion was made by Director Terry Sain and seconded by Director Robert C. Hoskins approving the December 01, 2011, MDD Board Regular Meeting. The vote was as follows: Ayes: Secretary Reggie Brewer, Director Brandon Capetillo, President Stephen H. DonCarlos, Director Robert C. Hoskins, Director Dee Anne Navarre, Director Terry Sain, Vice President Scott Sheley Nays: None MDD Regular Meeting; Minutes January 05, 2012 Page 2 of 7 Other: Director Ruben Linares (Absent), Director David McCartney (Absent), Director Mercedes Renteria (Absent), and Director Mary Hernandez (Not Present for Vote) Approved 2. PROPOSED RESOLUTIONS a. Consider Authorizing an Interlocal Agreement with the City of Baytown for Administrative Services - Administration. Council Member Sain excused himself from the meeting at 4:38 P.M. and returned at 4:44 P.M. General Manager Leiper presented the agenda item and stated that Resolution No. 176 authorizes an Interlocal Agreement between the Baytown Municipal Development District (the "MDD ") and the City of Baytown for Administrative Services. Under the agreement the City will develop, organize and manage the MDD's projects. Currently, the City of Baytown and the MDD in most cases enter into an interlocal for funding of certain agreements. Such practice is expected to continue; however, should the District desire to contract directly with a third party for a development project, this contract provides for the administration of such project. The agreement also designates the City as the purchasing agent for the MDD. Those persons working on projects of the MDD will be City employees and the City assumes responsibility for the supervision and control of its employees. The agreement will be funded in accordance with the amount allocated by the MDD each year through its budget process. The MDD will not be obligated under the agreement to pay more than what it collects in sales and use tax for a given year. The agreement has a term of two years with automatic renewals and may be terminated for cause by either party after providing a 30 -day cure period. Director Brewer inquired about the accounting process for allocating the amount of time staff spends working on MDD projects. General Manager Leiper stated that staff allocates the amount of time by estimating the number of hours spent in a lump sum from an analysis of MDD projects. General Manager Leiper stated that staff does not charge time to different projects and the allocated amount is less than I% even though the industry standard is 5% of budget. A motion was made by Secretary Reggie Brewer and seconded by Director Robert C. Hoskins approving Resolution No. 176. The vote was as follows: Ayes: Secretary Reggie Brewer, Director Brandon Capetillo, President Stephen H. DonCarlos, Director Mary Hernandez, Director Robert MDD Regular Meeting Minutes January 05, 2012 Page 3 of 7 C. Hoskins, Director Dee Anne Navarre, Vice President Scott Sheley Nays: None Other: Other: Director Ruben Linares (Absent), Director David McCartney (Absent), Director Mercedes Renteria (Absent), and Director Terry Sain (Not Present for Vote) Approved RESOLUTION NO. 176 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT AUTHORIZING THE PRESIDENT TO EXECUTE AN INTERLOCAL AGREEMENT WITH THE CITY OF BAYTOWN FOR ADMINISTRATIVE SERVICES; AUTHORIZING PAYMENT OF AN AMOUNT NOT TO EXCEED THREE HUNDRED THOUSAND AND NO 1100 DOLLARS ($300,000.00) FOR THE FIRST YEAR UNDER THE AGREEMENT; MAKING OTHER PROVISIONS RELATED THERETO; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. b. Consider Revising the Baytown Municipal Development District's Investment Policy and Strategy - Finance. Finance Director Louise Richman presented the agenda item and stated that Resolution No. 177 revises the Baytown Municipal Development District's (MDD) Investment Policy in order to comply with legislative changes and approval in accordance with the Public Funds Investment Act Section 2256 -005 (e). The Investment Policy and Strategy adds an additional broker /dealer (Wells Fargo Brokerage Services, LLC), approves additional authorized investments and includes revisions to the MDD's Investment Strategy. Finance staff reviewed the revisions in a presentation. President DonCarlos stated that in regards to obligations guaranteed or insured by the FDIC, would credit unions be excluded being that they are insured through another entity. Ms. Richman stated that this does not preclude credit unions but equivalent language to include them can be added. General Manager Leiper stated that the City is broadening investments capabilities, but they are all in line with the Public Funds Investment Act. Director Sheley inquired of possibly having a finance committee for MDD. Mayor DonCarlos asked General Manager Leiper to look into the option of having a finance committee. MDD Regular Meeting Minutes January 05, 2012 Page 4 of 7 A motion was made by Secretary Reggie Brewer and seconded by Director Robert C. Hoskins approving Resolution No. 177. The vote was as follows: Ayes: Secretary Reggie Brewer, Director Brandon Capetillo, President Stephen H. DonCarlos, Director Mary Hernandez, Director Robert C. Hoskins, Director Dee Anne Navarre, Director Terry Sain, Vice President Scott Sheley Nays: None Other: Director Ruben Linares (Absent), Director David McCartney (Absent), and Director Mercedes Renteria (Absent) Approved RESOLUTION NO. 177 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT ADOPTING THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT'S INVESTMENT POLICY AND INVESTMENT STRATEGY IN ACCORDANCE WITH THE PUBLIC FUNDS INVESTMENT ACT; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. 3. REPORTS a. Receive the Baytown Municipal Development District's Revenue and Expenditure Report for the Quarter Ending December 31, 2011 - Finance. Finance Director Louise Richman presented the update on the Baytown Municipal Development District's Revenue and Expenditure Report for the Quarter Ending December 31, 2011 and stated that the sales tax revenue increased 15.7% compared to the prior year. Ms. Richman stated that the expenditures are within the budget numbers. b. Receive the Baytown Municipal Development District's Investment Report for Quarter Ending December 31, 2011- Finance. Finance Director Louise Richman presented the Baytown Municipal Development District's Investment Report for the Quarter Ending December 31, 2011 and stated that the interest rate is still low but after the approval of the changes to the investment policy, other options will be explored to receive higher investment returns. MDD Regular Meeting Minutes January 05, 2012 Page 5 of 7 C. Receive a Proposed Site Plan for 700 W. Texas - Administration. General Manager Leiper presented the agenda item and introduced Mr. Chris Presley to present a proposed site development plan for 700 W. Texas. Mr. Presley stated that there is now a cross fit gym in the flex space which is sort of an intense cross training. Mr. Presley stated that there were sound proof walls added to the space to provide a sound barrier. Mr. Presley stated that the site plan is preliminary and the dimensions are approximate such as the building footprints and parking, etc. which is open to adjustments. Mr. Presley stated that it's a flexible design that allows for two to four businesses depending on the partitioning. He stated that if the building is considered to be one unit, the parking challenge would be that you would have to go around the entire building to get to the middle of the unit which can be an inconvenience. Mr. Presley stated that with the inconvenience concern, the architect split the one building into to two smaller units to provide for a more convenient access. General Manager Leiper stated that Mr. Presley is working closely with the Economic Development Foundation to reach out to developers, brokers, and franchise operators in regards to this proposed site plans future development. Mr. Presley presented options for the proposed site and stated that in phase 1 he was able to handle 100% of all the risk of the project and the lease. Mr. Presley stated that he is still willing to incur the liability of the lease and risk liability, but that he is no longer in the position to incur as much liability as to what was required in the initial phase. He stated that he can continue to put in sweat equity and the tenant improvements when that point is reached. Mr. Presley stated that if the MDD desires to switch roles and assume the risks, collect the rents, and work out the encumbrance of the lease, he is willing to switch roles with hopes of being involved in the construction, management, and the leasing etc. Mr. Presley stated that he's open to any option to get the project done. Director Brewer requested a copy of Mr. Presley's report that he submitted at the previous meeting discussing 700 W. Texas. President DonCarlos stated that it would be helpful if the members all reviewed the initial proposal and if there were cost figures provided, there would be a better concept of the proposed plan. 4. MANAGER'S REPORT a. Discuss Traffic Improvement Plan for Garth north of I -10 - Administration. General Manager Leiper presented the agenda item to discuss Traffic Improvement Plan for Garth Road north of I -10. MDD Regular Meeting Minutes January 05, 2012 Page 6 of 7 General Manager Leiper stated that City staff has been working with Harris County, the Springfield Homeowner's Association, Spring Meadows MUD and LEGNA Developers to improve traffic Flow out of the subdivisions north of I -10. He stated that the traffic volume from the developments warrants a traffic signal, especially since Walker Elementary was opened. General Manager Leiper stated that the exit from Eastpoint Section One (Stonebridge St.) and Springfield (Spring Park Dr.) are offset in their alignment at Garth Road and the offset makes signal installation impractical. He stated that since the commercial frontage on the east side of Garth has not yet developed, there is an opportunity to realign the streets and signalize the intersection. General Manager Leiper stated that conceptual agreements for a joint venture to improve traffic flow and safety as the area continues to grow has been reached. He stated that the agreements are as follows: the developer will donate the land for the new alignment and provide the survey necessary for the re- platting and the unused portion of the existing ROW will revert to the developer; the County will pay for the design and installation of the traffic signal; Commissioner Morman has received Commissioners Court approval to negotiate a contract for design; and the HOA will give up its subdivision sign property and sign and a new site for a sign will be provided in the plat and the HOA will be responsible for its future construction. General Manager Leiper stated that Legna agreed to use their development resources to reconstruct the road if the City would split the cost of the reconstruction. General Manager Leiper stated that the City is not able to provide funding because the project is outside of the city limits, but that the MDD could. General Manager Leiper stated that the reconstruction will be in the area of $250,000 and MDD will contribute $125,000. General Manager Leiper stated that he hopes to have the development agreement with Legna, HOA, and Harris County ready for MDD's consideration at the February 2012 meeting. Additionally, Harris County is already moving forward with designing the signal and will fix this at a relatively low cost. General Manager Leiper stated that there's a Centerpoint gas line and a Verizon fiber optic line that could complicate the matter, but Centerpoint has agreed to allow the street to cross their line and not to relocate it. Additionally, a meeting is scheduled with Verizon in regards to their line so at this point the cost is uncertain. General Manager Leiper stated that the MDD will enter into an agreement with the developer whereby the City staff provides engineering design for the new alignment. 5. ADJOURN A motion was made by Director Brandon Capetillo and seconded by Director Robert C. Hoskins adjourning the January 05, 2012, MDD Board Regular Meeting. The vote was as follows: Ayes: Secretary Reggie Brewer, Director Brandon Capetillo, President Stephen H. DonCarlos, Director Mary Hernandez, Director Robert C. Hoskins, Director Dee Anne Navarre, Director Terry Sain, Vice President Scott Sheley MDD Regular Meeting Minutes January 05, 2012 Page 7 of 7 Nays: None Other: Director Ruben Linares (Absent), Director David McCartney (Absent), and Director Mercedes Renteria (Absent) Approved With there being no further business to discuss, President DonCarlos adjourned the January 05, 2012, Municipal Development District (MOD) Board Regular Meeting at 5:30 P.M.