2003-10-07 TAX INCREMENT REINVESTMENT ZONE NO. 2 BOARD MEETING MINUTESA regular meeting of the Board of Directors "Board of the Tax Increment Reinvestment Zone
Number Two "Zone City of Pearland, Texas, was held in the Council Chambers of City Hall,
located at 3519 Liberty Drive, Pearland, Texas, on Tuesday, October 7, 2003, at 4:00 p.m. The
meeting was open to the public.
Board Members in Attendance:
Gary Cook, Vice Chair
Jo Knight
James McFeron
Mike Pyburn
Larry Loessin
Donna Coleman
Ron Castillo
Gary Davis
Developers in Attendance:
Drew Pelter Shadow Creek Ranch Dev. Co.
City of Pearland Representatives in Attendance:
FIon. Tom Reid
Alan Mueller
Bill Eisen
1. Introduction;
Vice Chair, Gary Cook, welcomed those
2. Call the meeting to order, take attendance and verify that a quorum is present.
Mr. Cook called the meeting to order at 4:05 p.m. and took attendance. The following Board
Members were present:
1. Gary Cook
2. Jo Knight
3. James McFeron
4. Mike Pybum
5. Larry Loessin
MINUTES OF THE BOARD OF DIRECTORS MEETING
Tax Increment Reinvestment Zone Number Two
CITY OF PEARLAND, TEXAS
October 7, 2003
Board Members Not in Attendance:
Nigel Harrison
Consultants in Attendance:
David Tinney LJA Engineering
Mark McGrath Null Lairson
Lynne Humphries Allen Boone Humphries, LLP
Bob DeForest KGA/DeForest Designs
Sue Darcy Knudson Associates
Charles Knight Knudson Associates
James Ross LJA Engineering
Bob DeForest KGA/DeForest Design, LLC
Frank Ildebrando RBC Dain Rauscher
Mark McGrath Null-Lairsson
Chris Johnson Iluitt- Zollars
attendance and introduced the new Board Members.
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6. Donna Coleman
7. Ron Castillo
8. Gary Davis
Board Member Nigel Harrison was not in attendance.
3. Discuss and approve minutes of March 4, 2003 Board meeting.
Alan Mueller, Deputy City Manager for the City of Pearland, noted that the year in which the
meeting was held was incorrectly stated in the minutes' introduction as 2002, instead of 2003.
He also noted that in the first sentence of the second paragraph under item 4, the text should read
"...wastewater treatment facility..." Board Member Pyburn moved that the Board approve the
minutes of the March 4, 2003, subject to these changes. Board Member McFeron seconded the
motion. Following discussion, the Board unanimously approved the motion.
4. Project report from the City and discuss role of City's Financial Advisor in TIRZ
financing and future reimbursement projections; take appropriate action.
Alan Mueller reported that Phase II of the Shadow Creek Parkway Sanitary Sewer Improvements
is under construction and scheduled for completion in the 1 Quarter of 2004. Additionally, Mr.
Mueller told the Board that construction of the Far Northwest Wastewater Treatment Plan is
operational with minor inspection items remaining. Final acceptance should occur in early 4th
Quarter of 2003.
Mr. Mueller then introduced Frank Ildebrando with RBC Dain Rauscher, the City's financial
advisors, who then reviewed with the Board the procedures and reimbursement schedule related
to possible future bond issues. Mr. Mueller also mentioned that the City may create a local
government corporation (LGC) to issue such bonds. Mr. Ildebrando reported that any bonds that
are issued would be revenue bonds based upon figures provided by the Developer and the City.
If bonds are issues annually, RBC Dain Rauscher would prepare annual bonding capacity
analyses. No bonds will be sold with less than the required 125 percent coverage. Board
Member Coleman asked if the new state laws regarding school districts and heavy reliance on
sales tax dollars been factored into decision making process. Lynn Humphries with Allen Boone
Humphries, Zone Attorneys, answered that yes they had been considered. Board Member Cook
noted that the approximate $87 million TIRZ budget represents a nearly $20 million savings due
to cost sharing with area municipal utility districts.
The Board took no action on the Report.
5. Project report from Developer and PowerPoint Presentation; take appropriate
action.
Drew Pelter of Shadow Creek Ranch Development Company L.P. reviewed the status of
construction with the Board.
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Other projects updates of note included construction of Lake Francis, which is 75% complete,
ground breaking on the 1 AISD school and two park improvements projects. Upcoming
north /south paving projects include the paving of Kingsley Drive.
Mr. Pelter also reported that the budget for all work completed to date amounted to
approximately $21 million, with the actual amount spent amounting to $24 2 million, adjusted
for 2003 numbers. This means the Zone is currently running about $2.7 million under budget.
An additional $17 4 million in improvements are under construction. Approximately 485 homes
have been sold in 2003, with 220 closings and 195 under construction. Mr. Pelter estimated that
400 homes will be completed and occupied by the end of 2003.
The Board took no action on the Report.
6. Discuss and take necessary action regarding Auditor's Report on TIRZ Invoices
Presented for payment and approval of outstanding administrative invoices to date.
Mark McGrath of Null Lairson, Zone Auditor, summarized the outstanding administrative
invoices to date. Board Member Castillo moved that the Board approve the Auditor's Report on
TIRZ invoices presented for payment and the outstanding administrative invoices to date. Board
Member Loessin seconded the motion. Following discussion, the Board unanimously approved
the motion.
7. Review status of previously approved projects.
David Tinney of LJA Engineering, Zone Engineer, reviewed with the Board the status of
previously approved projects. The Board took no action on the report.
8. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Remaining Village 2, Phase 2 Public
Improvements, Project (LFA #03 -10 -001).
9. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Village 3, Phase 1 2 Public
Improvements, Project (LFA #03 -10 -002).
10. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Village 3, Phase 3 Public
Improvements, Project (LFA #03 -10 -003).
11. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Kingsley Drive, Phase 3 Public
Improvements, Project (LFA #03 -10 -004).
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12. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Kingsley Drive, Phase 4 Public
Improvements, Project (LFA #03 -10 -005).
13. Discuss and take necessary action regarding Huitt Zollars, Inc.'s request for
Construction Audit Work Authorization for Village 5, Public Improvements,
Project (LFA #03 -10 -006).
The Board elected to consider items 8 through 13 together. Chris Johnson with Huitt Zollars,
Zone Construction Auditor, reviewed the work authorizations with the Board. Board Member
McFeron moved that the Board authorize the construction audit work for the afore mentioned
projects. Board Member Davis seconded the motion. Following discussion, the Board
unanimously approved the motion.
14. Discuss and take necessary action regarding amending the Letter Finance
Agreement for Primary Entry Monument (LFA #99 -11 -001) to include land costs
and construction contingencies.
Lynn Humphries reviewed the amended Letter Finance Agreement (LFA) with the Board. As
amended, the LFA for Primary Entry will include land costs and contingencies.
Board Member Pyburn commented that any amendments to LFA's are contrary to past
procedures, and the original LFA did include contingencies, but not land costs. Board Member
Pyburn moved to have the item tabled until LJA provides details of the extra costs, then approve
those extra costs as a separate LFA. Board Member Loessin seconded the motion. Following
discussion, the Board unanimously approved the motion to table.
15. Discuss and take necessary action regarding construction of the Remaining Village 2
Public Improvements, LFA #03 -10 -001;
a. Report on upcoming construction by LJA Engineering, Zone Engineer;
b. Report from Huitt Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Remaining Village 2 Public
Improvements, LFA #03 -10 -001;
16. Discuss and take necessary action regarding construction of the Village 3, Phase 1
2 Public Improvements, LFA #03 -10 -002;
a. Report on upcoming construction by LJA Engineering, Zone Engineer;
b. Report from Huitt-Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Village 3, Phase 1 2 Public
Improvements, LFA #03 -10 -002;
17. Discuss and take necessary action regarding construction of the Village 3, Phase 3
Public Improvements, LFA #03 -10 -003;
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a. Report on upcoming construction by LJA Engineering, Zone Engineer;
b. Report from Huitt Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Village 3, Phase 3 Public
Improvements, LFA #03 -10 -003;
18. Discuss and take necessary action regarding construction of the Kingsley Drive,
Phase 3 Public Improvements, LFA #03 -10 -004;
a. Report on upcoming construction by LJA Engineering, Zone Engineer;
b. Report from Huitt Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Kingsley Drive, Phase 3 Public
Improvements, LFA #03 -10 -004;
19. Discuss and take necessary action regarding construction of the Kingsley Drive,
Phase 4 Public Improvements, LFA #03 -10 -005;
a. Report on upcoming construction by LJA engineering, Zone Engineer;
b. Report from Huitt Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Kingsley Drive, Phase 4 Public
Improvements, LFA #03 -10 -005;
20. Discuss and take necessary action regarding construction of the Village 5 Public
Improvements, LFA #03 -10 -006;
a. Report on upcoming construction by LJA Engineering, Zone Engineer;
b. Report from Huitt Zollars, Construction Auditor;
c. Approve Letter Financing Agreement for Village 5 Public Improvements, LFA
#03 -10 -006;
The Board elected to consider items 15 through 20 together. David Tinney reviewed the work
authorizations with the Board. He confirmed that land costs and contingencies were included in
each of the LFA's. Board Member Pybum moved that the Board approve the LFA's for
execution. Board Member Davis seconded the motion. Following discussion, the Board
unanimously approved the motion, with Board Member Cook abstaining.
21. Discuss and take necessary action regarding Letter Financing Agreement for
Administration of the Zone for Fiscal Year 2004.
Alan Mueller reported that there was adequate tax increment revenue for TIRZ administration in
2004. Board Member Davis moved that the Board approve the LFA for 2004 Zone
Administration. Board Member Pyburn seconded the motion. Following discussion, the Board
unanimously approved the motion, with Board Member Cook abstaining.
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22. Discuss and take necessary action regarding employment of legal counsel for the
Zone and authorize appropriate action.
Lynne Humphries reviewed with the Board the reasons for her departure from Vinson Elkins
and the creation of the law firm of Allen Boon Humphries, as well as the qualifications of the
newly named partners. .At the request of the Board, Ms. Humphries then left the room so that the
Board could discuss the matter and review the services contract from Vinson Elkins and Allen
Boone Humphries. After some discussion, Board Member Knight moved that the Board enter
into an agreement with Allen Boone Humphries, LLP to provide legal services to the Zone.
Board Member Coleman seconded the motion. Following discussion, the Board unanimously
approved the motion.
23. New Business
No new business was brought before the Board.
24. Any other matters which may properly come before the Board.
The Board recommended that bonds be issued. Also, the Board requested that the City submit
quarterly revenue reports to the Board, which illustrate the tax increment revenue fund balance
per revenue source, as well as any expenditures from the fund, to which the City agreed
25. Adjournment.
Following discussion, the meeting was adjoutmed by unanimous consent at 5:45 p.m.
Approved:
Mike ybu
Board Secretary
Tax Increment Reinvestment Zone Number Two
City of Pearland, Texas
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