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2012 06 07 MDD MinutesMINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT June 07, 2012 The Board of Directors of the Baytown Municipal Development District (MDD) met in a Regular Meeting on Thursday, June 07, 2012, at 4:34 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 Brandon Capetillo Mary Hernandez Robert Hoskins David McCartney Dee Anne Navarre Terry Sain President Vice President Director Director Director Director Director Director Robert D. Leiper General Manager Leticia Brysch Assistant Secretary President DonCarlos convened the June 07, 2012, Municipal Development District (MDD) Board Regular Meeting with a quorum present at 4:34 P.M., all members were present with the exception of Directors Reggie Brewer, Ruben Linares, and Mercedes Renteria who were absent. 1. MINUTES a. Consider Approving the Minutes of the Baytown Municipal Development District Board Meeting for March 01, 2012 - Assistant Secretary. Consider approving the minutes of the Baytown Municipal Development District (MDD) Board Meeting held on March 01, 2012. A motion was made by Director Terry Sain, and seconded by Director Robert C. Hoskins approving the minutes of the March 01, 2012, MDD Board Regular Meeting. The vote was as follows: Ayes: Director Brandon Capetillo, President Stephen H. DonCarlos, Director Mary Hernandez, Director Robert C. Hoskins, Director David McCartney, Director Dee Anne Navarre, Director Terry Sain, and Vice President Scott Sheley Nays: None Baytown MDD Board Regular Meeting June 19, 2012 Page 2 of 8 Other: Director Reggie Brewer (Absent), Director Ruben Linares (Absent), Director Mercedes Renteria III (Absent) Approved 2. PROPOSED RESOLUTIONS a. Consider Authorizing a Development Project Contract with The Baytown Little Theater Incorporated - Administration. General Manager Leiper presented the agenda item and stated that Resolution No. 181 authorizes a Development Project Contract with The Baytown Little Theater Incorporated ( "BLT "). BLT wishes to construct a new 37,000 square foot theater at the intersection of N. Main Street and Texas Avenue. He further stated that the District committed to pay $500,000 to BLT toward the construction of the new facility in the Downtown area and in order for the BLT to secure its funding; they require a contractual agreement from the District for those funds. General Manager Leiper noted that because the Baytown Municipal Development District (the "District ") cannot expend funds until the project has that value on the ground, the District and the BLT have come up with a contract that will allow the District to make quarterly payments based on the following formula: ($500,000 x (Percentage* of Completion x 2)) — Amount Previously Paid by MDD *the percentage of completion shall be certified by BLT's design professionals. The BLT is required to submit to the District quarterly and annual reports describing the progress of the construction together with its audited annual financial statements. Additionally, for a period of ten years commencing from the issuance of the certificate of occupancy for the theater, BLT is required to operate in such facility a community theater with a minimum of six theatrical productions per year along with educational /youth programming. Should the BLT fail to do so, the entire amount paid by the MDD shall become immediately due and payable. Such repayment obligation will be secured by a lien, which will be forgiven once the ten -year period has expired. A motion was made by Director Robert C. Hoskins and seconded by Director David McCartney approving Resolution No. 181. The vote was as follows: Ayes: Director Brandon Capetillo, President Stephen H. DonCarlos, Director Mary Hernandez, Director Robert C. Hoskins, Director David McCartney, Director Dee Anne Navarre, Director Terry Sain, and Vice President Scott Sheley Nays: None Baytown MDD Board Regular Meeting June 19, 2012 Page 3 of 8 Other: Director Reggie Brewer (Absent), Director Ruben Linares (Absent), Director Mercedes Renteria III (Absent) Approved RESOLUTION NO. 181 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT AUTHORIZING THE GENERAL MANAGER TO EXECUTE AND THE ASSISTANT SECRETARY TO ATTEST TO A DEVELOPMENT PROJECT CONTRACT BETWEEN THE BAYTOWN LITTLE THEATRE INCORPORATED AND THE BAYTOWN MUNICIPAL DEVELOPMENT DISTRICT REGARDING FUNDING OF A THEATRE TO BE LOCATED ON PROPERTY AT THE INTERSECTION OF N. MAIN STREET AND TEXAS AVENUE TO PROMOTE NEW OR EXPANDED BUSINESS DEVELOPMENT WITHIN THE AREA; MAKING OTHER PROVISIONS RELATED THERETO; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. Mr. Wazinski, BLT Representative stated that the Wilkenfeld Family has donated all of their property on Texas Avenue to the BLT helping to solve parking and future expansion issues. Director Sheley inquired of the groundbreaking date. Mr. Wazinski stated that this is a very difficult question to answer. He stated that the BLT is currently at 1.5 to 1.6 million in their fundraising efforts, not including the Wilkenfeld donation, they have begun discussions with financial institutions and hope that by the end of the year, construction will have begun. Director McCartney asked what the financial goal was. Mr. Wazinski stated that initially the goal was 2.5 million; however, the building as it sits now is at $6.2 million. 3. REPORTS a. Present the Economic Development Foundation Second Quarterly Report for Fiscal Year 2011 -12 - Administration. President DonCarlos presented the item and stated that Mr. BJ Simon from the EDF will be presenting the Baytown Area/West Chambers County Economic Development Foundation's Quarterly Report for the quarter ending March 31, 2012. Mr. Simon stated that the report being covered spans from January I" to March 21", 2012. Mr. Simon directed the Board to begin on page one of the report which indicates the number of prospects that the EDF provided information of assistance on, such as site Baytown MDD Board Regular Meeting June 19, 2012 Page 4 of 8 and infrastructure availability, identification of opportunities, filing and permitting information. He stated that there were 48 prospects and 10 site visits in this time period, mostly for petrochemical expansion in the area; of the 10 site visits, 6 of them are still active and ongoing. Mr. Simon then stated that the EDF continued its work relating to retail developments and also attended the ICSC Conference in Las Vegas, Nevada, with General Manager Leiper and President DonCarlos. On page two, Mr. Simon stated that the EDF continues their work with the incubator without walls by maintaining relationships with many entities, such as, Lee College, USDA Business and Industry Development, TMAC, TEEX, ACCION — Texas, and GS 10,000. Additionally, the EDF continues to work with the City of Baytown as it relates to development and development, focusing on the housing projects, which has become more and more relevant with the expansion of industry projects in the area. He also stated that Verizon's project is moving forward around the Baytown -West Chambers County service area and they will be building a cell tower in the area. On page three of the report, Mr. Simon stated that the EDF continues to work on its relationships with the Port Region Transportation Corridor Task Force, the Cedar Bayou Inter -Model Transportation, the Environmental Strategy project and the Gulf Coast Rail District. Mr. Simon pointed out that as it relates to item number 2, regarding the Cedar Bayou Inter -Model Transportation, the EDF continues to work with them in order to submit an application for a marine transportation corridor designation The EDF also continues to work with the workforce and development analysis, helping to facilitate a number of meetings to help plan for workforce development to help with the continued growth and development of the region's workforce. Additionally, the EDF partnered with research and development assistance to the United Way of Baytown's Early Childhood Education IMPACT effort, which seeks to improve school readiness systematically at the Pre -K level. Mr. Simon stated that the EDF continued its tax incentive programs and conducted educational meetings, one of which was the Baytown City Council retreat in January 2012. On page five, Mr. Simon identified that the EDF continued support of the Majestic Realty and AmeriPort Industrial Park Free Trade Zone application process. On page six, Mr. Simon identified its continued coordination with regional allies, such as the Port of Houston for the Retail Industry Leaders Association, which is the supply chain side of the retail industry, which is important to bring in the logistics and supply part of retail such as the Wal -Mart distribution center. The EDF continues to work with the promotion and dissemination of facts and information related to Baytown and West Chamber County and lastly, the EDF has continued to work closely with the Texas Governor's Office, which have been involved with the site visits that have been mentioned earlier in the report. Baytown MDD Board Regular Meeting June 19, 2012 Page 5 of 8 Director McCartney asked what was the probability of the six projects mentioned in the report coming to fruition? Mr. Simon stated that they all looked pretty positive at this time and said that all of the projects were steel pipe related and heavy fabrication. President DonCarlos requested that once the workforce project was farther along, the EDF come before the Council and MDD to give an overview of the work that is being done. President DonCarlos further stated that local industry; particularly Exxon, Bayer and Chevron have asked the City of Baytown to help coordinate a program that will help get the local workforce both adult and young people where it needs to be very quickly to deal with imminent need for construction and technical jobs. Council Member Capetillo serves as Council's representative on this Committee; however, others will be asked to participate as needed. President DonCarlos stated that there will be an estimated 20,000 construction jobs available and wanted to make sure that our citizens benefited from this opportunity. Council Member Capetillo stated that the amount of jobs being brought into the area with exceed the initial forecasted numbers. He also stated that he had spoken to people within Baytown and to the east of Baytown that have asked for a grocer to be brought into the area to help meet that need. Mr. Simon stated that the grocer in question has been looking at two sites in the Baytown area. President DonCarlos stated that he had an opportunity to attend the Shell safety day at Cedar Crossing and saw that they are building a huge deep sea rig. He stated that he also noted that there are about 300 welders out there and noted that there are many people from out of state working in the area. Director Hoskins asked if the two locations being reviewed by the grocer were in Baytown. Mr. Simon stated that one location is in the city limits of Baytown and the second is on the City's ETJ. Director Hoskins then asked what was the EDF's communication and coordination with the City of Baytown and Harris County, as it relates to the marine highway designation project. Mr. Mike Shields, EDF Representative stated that the request to assist with this marine highway designation came from the Chambers County Judge and that there had been limited communication with the City of Baytown or Harris County; however, Mr. Shields also stated that it was very important to hear from the City on what its desires and concerns are as it relates to this project. This project is administered under the U.S. Department of Transportation and would allow for the designation of a marine highway and the creation of a marine connector, which moves trucks off of the roads and onto the water. The first step in the process is for the designation of a body of water as a marine highway, in this case Cedar Bayou, which then makes federal funding available for public and private entities to upgrade and expand the port in this area. Baytown MDD Board Regular Meeting June 19, 2012 Page 6 of 8 Director Hoskins stated that he would like to see more participation from the City of Baytown and Harris County in this process and Cedar Bayou is not solely located in Chambers County and could impact Baytown citizens and their quality of life. Director McCartney asked if this designation meant that there would be an increase of barge terminals all along Cedar Bayou. Mr. Shields stated that this is not necessarily the case, but stated that it could better the quality and efficiency of those that are already there through expansion. Mayor DonCarlos stated that as he understood the situation, the volume has already overwhelmed the public docks that are there now. Mr. Shields stated that the intent of the Chambers County judge is to prepare for the volume that will be coming to the area because of the industrial expansions that are taking place and coming down the road. The goal is to move most of the movement to the mouth of Cedar Bayou and limit the movement everywhere else. Director McCartney stated that the future development of the peninsula should be taken into consideration, as the high volume of marine traffic and barges could negatively impact this area ever being developed. Director Hoskins stated that he felt that the EDF was moving in the right direction in getting development into the area. He stated that moving the industry to the mouth of Cedar Bayou makes sense, but felt it was important to consider the appropriate development and mitigation more towards the north of the area that has a lot of residents. Mr. Shields stated that Cedar Crossing has 12,000 acres and is a former steel industrial site with connecting waterways that has been designated by the Texas Governor's Office as the prime industrial site on the Gulf Coast of Texas. Director McCartney stated that he wants to make sure that all of this development is being planned appropriately as there are already concerns and problems with noise along Cedar Bayou, which will only be aggravated with the increase of pipe and steel industry. Mr. Shields stated that the steel and pipe industries that are considering locating in the area are loud, need the transportation and need to be allowed to do their work. If this is not the type of industry that the City wants locating in Baytown, then the EDF needs to know that, in order to make the appropriate changes in direction. Mr. Shields further stated that the EDF is focused on managing the development along Cedar Bayou to allow for recreational facilities and activities while still providing economic development and jobs. In response to a question by Director Sheley regarding what was the right way to sell Cedar Crossing, Mr. Shields stated that Cedar Crossing is a privately owned facility that can be sold at any time to anyone and the goal of the EDF is to help ensure that whatever company purchases the site will know up front that they will have to put in place the appropriate buffers and mitigation efforts to protect the surrounding neighbors. Baytown MDD Board Regular Meeting June 19, 2012 Page 7 of 8 President DonCarlos stated that there are two theories on what should happen along Cedar Bayou, the first is from a group of residents on the west side that want no type of development what so ever on the east side, which is not very realistic. The second option is to build in some standards before the companies come in that will help mitigate noise such as quiet backup standards. Director McCartney stated that there are still some issues with the movement of containers, which will impact the neighboring residents. President DonCarlos stated that the steel companies work with raw materials and not containers. He also stated that there would be some light abatement and building standards to help with noise. President DonCarlos stated that he felt there was a way to mitigate the impact of industry in the area in a way that didn't scare off industry and minimized the negative impacts to the neighboring community. McCartney stated that it was important to find a balance between he industrial development and the residents. b. Receive the Baytown Municipal Development District's Revenue and Expenditure Reports for the Six Months Ending March 31, 2012 - Finance. General Manager Leiper presented the Baytown Municipal Development District's Revenue and Expenditure Report for the Six Months Ending March 31, 2012 and stated that the District is at 50% of the budget year, we are at 62% of the budgeted revenues; making the revenues exceed our projections. The District is at 36% of the expenditures and further stated that any expenditure outside of the approved budget would come to the District for further action. Hence, the District is right in line with its projected expenditures and ahead of its projected revenues. C. Receive the Baytown Municipal Development District's Investment Report for Six Months Ending March 31, 2012 - Finance. Ms. Louise Richman, Director of Finance presented the Baytown Municipal Development District's Investment Report for the Six Months Ending March 31, 2012 and stated that the District is right at 5 million dollars. President DonCarlos asked what the state of the budget was as it relates to unencumbered funds. General Manager Leiper stated that in unrestricted funds, the District has $500,000 in contingency and $300,000 in new or expanding businesses to name a few of the monies that are available to the District should an opportunity arise that was not anticipated, such as park land, but estimated that the District has anywhere from 1.5 to 2 million in available funds for a large project if needed. General Manager Leiper stated that he would provide the District with a complete list of the District's discretionary funds. 4. MANAGER'S REPORT Baytown MDD Board Regular Meeting June 19, 2012 Page 8 of 8 General Manager Leifer stated that the City is trying to stay ahead of the curb as it relates to the new development and expansion projects and how they will impact our community. The City has met with TxDOT regarding 1 -10 and Sjolander and is looking at strengthening the multi family dwelling requirements. He also stated that he and a number of other members of staff will be meeting with the City of Port Arthur to discuss the pros and cons from their experience with Motiva to better assist the City when dealing with the new industry coming to the area. Lastly, Mr. Leiper stated that Exxon is relocating 4 -3 thousand employees from Virginia to the Woodlands, in addition to a number of contract employees from the Baytown facility that will also be moving but they are moving because they have a new assignment, which is not uncommon for Exxon. General Manager Leiper stated that he is interested in looking at a transit program that will help those residents from Baytown get to the Woodlands and /or having people from the Woodlands wanting to move to Baytown. 5. ADJOURN With there being no further business to discuss, President DonCarlos adjourned the June 07, 2012, Municipal Development District (MDD) Board Regular Meeting at 5:25 P.M.