2008-08-25 DEVELOPMENT AUTHORITY OF PEARLAND SPECIAL MEETING MINUTESMINUTES OF A SPECIAL MEETING OF THE DEVELOPMENT AUTHORITY OF
PEARLAND, CITY OF PEARLAND TEXAS , TO BE HELD ON MONDAY, AUGUST
25, 2008, 3:00 P.M., IN THE SECOND FLOOR CONFERENCE ROOM, CITY HALL,
3519 LIBERTY DRIVE, PEARLAND, TEXAS.
Mayor Reid called the meeting to order at 3:02 p.m. with the following present:
Chairman
Secretary
Boardmember
Boardmember
Absent: Boardmember Tom Pool
Tom Reid
Henry Stanaland
Bill Sloan
Ed Baker
Others in attendance: Bill Eisen, City of Pearland City Manager, Claire Bogard, City of
Pearland Director of Finance; Trey Lary, Allen Boone Humphries Robinson, LLP; Sonia
Blair, City of Pearland.
NEW BUSINESS
BOARD ACTION — APPROVAL OF THE DEVELOPMENT AUTHORITY OF
PEARLAND BOARD OF DIRECTORS MEETING MINUTES FOR SEPTEMBER 24,
2007. DAP Board of Directors.
Boardmember Baker made the motion, seconded by Boardmember Stanaland, to
approve the Minutes of the September 24, 2007, Special Meeting.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Motion Passed 4 to 0, Boardmember Pool absent.
BOARD ACTION — RESOLUTION NO. RDAP-2008-05— A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE DEVELOPMENT AUTHORITY OF PEARLAND
(DAP), ACCEPTING THE DAP INVESTMENT REPORT FOR THE QUARTER ENDING
JUNE 2008. Ms. Claire Bogard, Director of Finance.
City of Pearland Director of Finance Claire Bogard reviewed the June 30, 2008,
Quarterly Investment Report. She stated the beginning market value and book value
as of March 31, 2008 is $901,866.99 and as of June 30, 2008, the market value and
book value is $896,082. The average yield for the period was 1.32% versus a one -day
agency note of 2.20% and a T-bill of 2.07%. Options were investigated on whether the
money could be invested in a different place other than where it currently is, but due to
a Trust Indenture in the Bond Covenant, it has to remain with Wells Fargo Bank.
Page 1 of 5 — 8/25/2008 - DAP
Discussion ensued between Boardmembers, City of Pearland Director of Finance Claire
Bogard, and Trey Lary, Allen Boone Humphries Robinson, LLP, regarding the
Investment Report.
Boardmember Baker made the motion, seconded by Boardmember Sloan, to approve
Resolution No. RDAP2008-05.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Motion Passed 4 to 0, Boardmember Pool absent.
BOARD ACTION — RESOLUTION NO. RDAP-2008-02— A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE DEVELOPMENT AUTHORITY OF PEARLAND
(DAP) RATIFYING CHECKS 1033 THROUGH 1050 APPROVED AND SIGNED BY
THE DEVELOPMENT AUTHORITY COMMITTEE AND APPROVING CHECK 1051
FOR PAYMENT. Ms. Claire Bogard, Director of Finance.
City of Pearland Director of Finance Claire Bogard stated, due to infrequent meeting
dates, the Development Authority Board had previously appointed an Invoice Review
Committee to review invoices and issue checks for payment. The Invoice Review
Committee has currently issued checks for $74,400.57, of which $41,351.00 are
issuance costs associated with Bond Series 2007. Approving this Resolution will ratify
the checks already issued and approve check number 1051 for $2000.00 to the City of
Pearland.
Boardmember Reid stated the invoice review system seems to be working and prevents
vendors from having to wait for payment.
Boardmember Sloan asked if there was a maximum amount the Invoice Review
Committee can approve for one payment.
City of Pearland Director of Finance Claire Bogard stated she believes the maximum
amount the Invoice Review Committee can approve is $25,000 per invoice.
Boardmember Stanaland stated the paying agent fee of $3500 from Wells Fargo
seemed high and asked if this was a standard amount.
City of Pearland Director of Finance Claire Bogard stated the amount reflected two
series but did appear high compared to fees she has seen from other vendors.
Page 2 of 5 — 8/25/2008 - DAP
Trey Lary, Allen Boone Humphries and Robinson, stated the fee is higher because
there is a Trust Indenture and the bank is acting as Trustee in addition to the roll of
paying agent.
Boardmember Baker made the motion, seconded by Boardmember Sloan, to approve
Resolution No. RDAP2008-02.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Motion Passed 4 to 0, Boardmember Pool absent.
BOARD ACTION — RESOLUTION NO. RDAP-2008-03 — A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE DEVELOPMENT AUTHORITY OF PEARLAND
(DAP) ACCEPTING THE FINANCIAL REPORT FOR THE PERIOD ENDING JULY 31,
2008. Ms. Claire Bogard, Director of Finance.
City of Pearland Director of Finance Claire Bogard provided the Board with a review of
the Financial Report for the period ending July 31, 2008. She stated cash and
Investments are $897,049, with 100% in interest bearing money market accounts. Of
this amount $812,184 is debt service reserve and not available. The income statement
to date has $19,210,366 in revenues of which $15,950,000 is from bond proceeds,
$3,200,000 in compensation from TIRZ No. 2, and $2,000,000 cash compensation. The
Development Authority of Pearland has purchased Triple "A" debt service reserve
surety policies from CDC IXIS Financial Guarantee for the Series 2004, 2006 and 2007
issuances in lieu of holding cash reserves which limit developer reimbursements. As a
result of the national subprime situation, the company has been downgraded from the
Triple "A" rating which is required. Board financial advisors are recommending setting
aside the necessary debt service cash reserves for all outstanding Authority issues to
mitigate the negative impact of selling the series 2008 Development Authority of
Pearland issuance.
Discussion ensued between Boardmembers, City of Pearland Director of Finance Claire
Bogard, and Trey Lary, Allen Boone Humphries Robinson, LLP, regarding the Financial
Report.
Boardmember Sloan made the motion, seconded by Boardmember Stanaland, to
approve Resolution No. RDAP2008-03.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Page 3 of 5 — 8/25/2008 - DAP
Motion Passed 4 to 0, Boardmember Pool absent.
BOARD ACTION — RESOLUTION NO. RDAP-2008-04 — A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE DEVELOPMENT AUTHORITY OF PEARLAND
(DAP), REGARDING ANNUAL REVIEW OF INVESTMENT POLICY, STRATEGY, AND
LIST OF APPROVED BROKER/DEALERS. Ms. Claire Bogard, Director of Finance.
City of Pearland Director of Finance Claire Bogard stated, according to the Public Funds
Investment Act, the Board is required to annually review and adopt an Investment
Strategy and a list of approved Broker/Dealers. It is recommended that the Board adopt
the current Investment Policy of the City of Pearland that addresses all the items
required by the Public Funds Investment Act and is reviewed by the City's Investment
Committee. The City of Pearland Investment Policy was adopted by the TIRZ No. 2
Board in May 2008.
Boardmember Reid stated the Investment Policy includes the word "City" throughout the
document and he feel this does not clarify the separation of the Development Authority
of Pearland and the City of Pearland. He feels the wording in the document should be
changed to reflect the Development Authority of Pearland.
Trey Lary, Allen Boone Humphries Robinson, LLP, stated the separation of the two
entities is in the Resolution.
City of Pearland Director of Finance Claire Bogard stated the Resolution states "the
Board of Directors has determined to adopt the Exhibit "A" City of Pearland's Investment
Policy, Strategy, and Exhibit "B" list of Broker/Dealers as its own; Now, Therefore." This
wording is intended to reflect the separation.
Boardmember Reid stated it would be clearer if the wording in the Investment Policy
reflected the Development Authority of Pearland.
Boardmember Sloan made the motion, seconded by Boardmember Baker, to approve
Resolution No RDAP2008-04 with the understanding that the word "City" will be
replaced with the word "Authority" in the Investment Policy Document.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Motion Passed 4 to 0, Boardmember Pool absent.
Page 4 of 5 — 8/25/2008 - DAP
BOARD ACTION — RESOLUTION NO. RDAP-2008-01 — A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE DEVELOPMENT AUTHORITY OF PEARLAND
(DAP), ACCEPTING THE DISCLOSURE STATEMENTS OF THE AUTHORITY'S
INVESTMENT OFFICERS AND BOOKKEEPERS. Ms. Claire Bogard, Director of
Finance.
City of Pearland Director of Finance Claire Bogard stated the Public Funds Investment
Act requires that an investment officer of an entity who has a personal business
relationship with a business organization offering to engage in an investment
transaction with the entity shall file a statement disclosing that personal business
interest. She stated she does not have a personal business relationship with any of the
broker/dealers associated with the Authority. The Assistant Director of Finance Rick
Overgaard does personal business with RBC Dain Rausher, but with a different advisor
in an office located in another city.
Boardmember Sloan made the motion, seconded by Boardmember Baker, to approve
Resolution No. RDAP2008-01.
Voting "Aye" Boardmembers Reid, Stanaland, Sloan, and Baker.
Voting "No" None.
Motion Passed 4 to 0, Boardmember Pool absent.
� l�l�l�7►`1►iL=T►�
Meeting was adjourned at 3:51 p.m.
Minutes approved as submitted and/or corrected this the 3rd day of November, A.D.,
2008.
i
eevelopment Authority of Pearland
Chairman
ATTEST:
Development Authority of Pearland
Secretary
Page 5 of 5 — 8/25/2008 - DAP