2008-08-25 TAX INCREMENT REINVESTMENT ZONE NO. 2 BOARD SPECIAL MEETING MINUTESMINUTES OF A SPECIAL MEETING OF THE TAX INCREMENT REINVESTMENT
ZONE NUMBER TWO (TIRZ #2), ALSO KNOWN AS SHADOW CREEK RANCH,
CITY OF PEARLAND TEXAS, TO BE HELD ON MONDAY, AUGUST 25, 2008, AT
4:00 P.M., IN THE COUNCIL CHAMBERS, CITY HALL, 3519 LIBERTY DRIVE,
PEARLAND,TEXAS.
Chairman Harrison called the meeting to order at 4:05 p.m. with the following present:
Chair
Nigel Harrison
Vice Chair
Gary Cook
Boardmember
Donna Coleman
Boardmember
Gary Davis
Boardmember
Ken Phillips
Boardmember
Jo Knight
Boardmember
Larry Loessin
Absent: Secretary Mike Pyburn and Boardmember Ron Castillo.
Others in attendance: Mayor Tom Reid; Bill Eisen City of Pearland City Manager; Claire
Bogard City of Pearland Director of Finance; Rick Overgaard City of Pearland Assistant
Director of Finance; Sonia Blair City of Pearland Deputy City Secretary; James Ross
LJA Engineering; Steve Gardner Huitt—Zollars; Chris Johnson Huitt—Zollars; Mark
McGrath Null—Lairson; Drew Pelter Shadow Creek Ranch Development Company Ltd.,
Sue Darcy Marsh Darcy Partners, Inc.; Neal Rackleff Locke Lord Bissell & Liddell; Tim
Ng AmREIT; Trey Lary Allen Boone Humphries Robinson LLP.
NEW BUSINESS
BOARD ACTION — REGARDING THE APPROVAL OF THE SPECIAL MEETING
MINUTES OF THE MAY 15, 2008 TAX INCREMENT REINVESTMENT ZONE
NUMBER TWO (TIRZ #2) BOARD OF DIRECTORS MEETING. TIRZ # 2 Board of
Directors
Boardmember Davis made the motion, seconded by Boardmember Phillips, to approve
the Minutes of the May 15, 2008, Tax Increment Reinvestment Zone Number Two
Board of Directors Meeting held at 4:00 p.m.
Voting "Aye" Boardmembers Harrison, Cook, Coleman, Davis, Phillips, Loessin, and
Knight.
Voting "No" None.
Motion Passed 7 to 0, with Boardmembers Pyburn and Castillo absent.
Page 1 of 7 — 8/25/2008 — TIRZ No. 2
BOARD ACTION — RESOLUTION NO. —RTIRZ-2008-01 — A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE TAX INCREMENT REINVESTMENT ZONE
NUMBER TWO (TIRZ #2) APPROVING RECOMMENDATION FOR
REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA) NO. 06-08-003).
Mr. Mark McGrath, Null Lairson.
Boardmember Phillips made the motion, seconded by Boardmember Knight, to approve
Resolution No. RTIRZ-2008-01.
Mark McGrath, Null Lairson, stated this item is a Letter of Financing Agreement (LFA)
that relates to Shadow Creek Ranch Development and the SH 288 frontage road. The
budget for the LFA is $276,000 and the actual cost is $1,000,000. The interest
computed through the July 31, 2008, is $52,000. The total reimbursement to Shadow
Creek Developers being sent to the Development Authority of Pearland for future
reimbursement is $1,052,016.
Voting "Aye" Boardmembers Harrison, Coleman, Davis, Phillips, Loessin, and Knight.
Voting "No" None.
Voting "Abstain" Boardmember Cook.
Motion Passed 6 to 0, with Boardmembers Pyburn and Castillo absent and 1
abstention.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-02 — A RESOLUTION OF THE
BOARD OF DIRECTORS FOR THE TAX INCREMENT REINVESTMENT ZONE
NUMBER TWO (TIRZ # 2) APPROVING RECOMMENDATION FOR
REIMBURSEMENT (LETTER FINANCING AGREEMENT (LFA) NO. 06-10-001 AND
07-03-002). Mr. Mark McGrath, Null Lairson.
Boardmember Loessin made the motion, seconded by Boardmember Davis, to approve
Resolution No. RTIRZ-2008-02.
Mark McGrath, Null Lairson, stated this is two more Letter of Financing Agreements
(LFAs) for reimbursement to the sub -developer Shadow Creek Ranch Retail, LP. The
first LFA is for the road infrastructure, pipeline relocation and site drainage. The
estimated cost was $11,400,000; however, the LFA total is $9,949,000 and the
agreement specifies the payment will be limited to the amount of the LFA. The second
LFA is for landscaping, detention drainage, and location of overhead utilities with a total
amount of $1,851,000. The computed interest for both LFA's through July 1, 2008, is
$1,178,000 making the total due back of $12,979,940, through July 1, 2008.
Page 2 of 7 — 8/25/2008 — TIRZ No. 2
Voting "Aye" Boardmembers Harrison, Cook, Coleman, Davis, Phillips, Loessin, and
Knight.
Voting "No" None.
Motion Passed 7 to 0, with Boardmembers Pyburn and Castillo absent.
BOARD ACTION — REGARDING A PRESENTATION FROM CRC REGARDING ITS
ACTIVITIES. Mr. Trey Lary, Allen Boone Humphries Robinson LLP.
Trey Lary, Allen Boone Humphries Robinson LLP, stated previously the Board
discussed the efforts of the Community Redevelopment Coalition (CRC) and its
participation in the CRC. The CRC requested funds for the year 2008. The Board
provided constructive criticism which was taken back to the CRC. He expressed that
the Board would like proactive plans prior to a Legislative Session to outline the specific
goals and an estimated budget. The CRC has re-evaluated the planning process and
the structure of the group and have rescinded the request for funding. They are
planning to reorganize the group to include members of Tax Increment Reinvestment
Zone Boardmembers and reduce the use of consultants. Mr. Lary provided the Board
with a presentation regarding Texas School District participation in Tax Increment
Reinvestment Zones and the value provided by the CRC. He stated no action is
needed for this item.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-03 — A RESOLUTION OF THE
BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT
ZONE NUMBER TWO (TIRZ # 2) BOARD OF DIRECTORS, ACCEPTING THE
FINANCIAL REPORT FOR THE PERIOD ENDING JULY 31, 2008. Ms. Claire Bogard,
City of Pearland Director of Finance.
Boardmember Phillips made the motion, seconded by Boardmember Loessin, to
approve Resolution No. RTIRZ-2008-03.
Claire Bogard, City of Pearland Finance Director, stated this item is the July 2008,
Financial Report. The Board has total assets of $9,052,407 in cash and investment with
$5,675,068 of that being the Alvin Independent School District (AISD) Fund. In August
a transfer $2.6 million was transferred from the AISD fund to the Operating fund. Total
revenues are $10,155,583, of which the majority is revenue from participating entities.
Expenses total $6,924,100 with $3,642,191 of that being the administration fee to the
City of Pearland and $3,220,843 that was transferred to the Development Authority of
Pearland for bond payments and developer reimbursement. The total Fund equity as of
July 31, 2008, is $9,052,407 which includes $5,675,068 in the suspense fund. The
available balance is $3,377,338. The TIRZ will be transferring $2,154,394 in August to
the DAP for the bond payment due September 1, 2008. It is estimated that at
September 30, 2008, the TIRZ will have approximately $3.7 million available to transfer
to the Development Authority.
Page 3 of 7 — 8/25/2008 — TIRZ No. 2
Discussion ensued between Boardmembers, Claire Bogard, City of Pearland Finance
Director, and Trey Lary, Allen Boone Humphries Robinson LLP, regarding the Financial
Report.
Voting "Aye" Boardmembers Harrison, Cook, Coleman, Davis, Phillips, Loessin, and
Knight.
Voting "No" None.
Motion Passed 7 to 0, with Boardmembers Pyburn and Castillo absent.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-04 — A RESOLUTION OF THE
BOARD OF DIRECTORS OF THE PEARLAND TAX REINVESTMENT ZONE
NUMBER TWO (TIRZ # 2), APPROVING INVOICES FOR PAYMENT.
Ms. Claire Bogard, City of Pearland Director of Finance.
Boardmember Coleman made the motion, seconded by Boardmember Davis, to
approve Resolution No. RTIRZ-2008-04.
Claire Bogard, City of Pearland Finance Director, stated there are currently invoices
totaling $41,678.11 which are being presented for approval for payment. The invoices
represent services received from Allen Boone Humphries Robinson, LLP, LJA
Engineering, and Marsh Darcy Partners and have all been reviewed to verify they
conform with all contracts. The annual operating budget is $175,000. Total current
expenditures, including these invoices, is $103,740.68 leaving $71,259.32 available for
continued operating expenses through 9/30/2008.
Voting "Aye" Boardmembers Harrison, Cook, Coleman, Davis, Phillips, Loessin, and
Knight.
Voting "No" None.
Motion Passed 7 to 0, with Boardmembers Pyburn and Castillo absent.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-05 — A RESOLUTION OF THE
BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT
ZONE NUMBER TWO (TIRZ # 2), ACCEPTING THE TIRZ NUMBER TWO (TIRZ # 2)
INVESTMENT REPORT FOR THE QUARTER ENDING JUNE 2008. Ms. Claire
Bogard, Director of Finance.
Boardmember Davis made the motion, seconded by Boardmember Knight, to approve
Resolution No. RTIRZ-2008-05.
Page 4 of 7 — 8/25/2008 — TIRZ No. 2
Claire Bogard, City of Pearland Finance Director, stated the beginning portfolio for the
Board was $5,290,652 and the current portfolio is $7,927,397. The increase is from the
contributions from participating entities. Ms. Bogard continued to provide the Board with
a detailed review of the Investment Report.
Voting "Aye" Boardmembers Harrison, Cook, Coleman, Davis, Phillips, Loessin, and
Knight.
Voting "No" None.
Motion Passed 7 to 0, with Boardmembers Pyburn and Castillo absent.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-07 — A RESOLUTION OF THE
BOARD OF DIRECTORS OF THE PEARLAND TAX INCREMENT REINVESTMENT
ZONE NUMBER TWO (TIRZ #2) BOARD OF DIRECTORS, APPOINTING THREE
MEMBERS TO SERVE AS AN INVOICE REVIEW COMMITTEE. Ms. Claire Bogard,
Director of Finance.
Claire Bogard, City of Pearland Finance Director, stated the City receives invoices
regularly which need to be approved by the Board. Since the Board meets irregularly,
she is recommending that three Boardmembers be named as an Invoice Review
Committee to approve invoices for payment as necessary. The invoices approved by
the Invoice Review Committee will be ratified by the Board at the next meeting.
Boardmember Loessin stated there was a committee of three at one point and that he
was one of the Boardmembers on it.
Boardmember Harrison stated there was a committee and because it was not dissolved
they should not need to approve this item.
Discussion ensued between Boardmembers and Claire Bogard, City of Pearland
Finance Director, regarding the Invoice Review Committee.
No action was taken by the Board.
BOARD ACTION — RESOLUTION NO. RTIRZ-2008-06 — A RESOLUTION OF THE
BOARD OF DIRECTORS OF PEARLAND TAX INCREMENT REINVESTMENT ZONE
NUMBER TWO (TIRZ # 2) AUTHORIZING CHAIR OF THE BOARD OF DIRECTORS
TO EXECUTE CONSENT TO ASSIGNMENT OF DEVELOPER REIMBURSEMENT
AGREEMENT. Ms. Lynne Humphries or Mr. Trey Lary with Allen Boone Humphries
Robinson LLP.
Page 5 of 7 — 8/25/2008 — TIRZ No. 2
Trey Lary, Allen Boone Humphries Robinson LLP, stated the TIRZ No. 2 Board
assigned the agreement for reimbursement from Transwestern to AmReit when AmReit
purchased the Transwestern Development. AmReit has fulfilled its obligations and it is
now time to put reimbursement in line for payment. Representatives from AmReit came
to the Board at a prior meeting asking for the payments to be assigned to another entity.
AmReit is asking the Board to approve the assignment of the reimbursements to
another entity that will be named in the future. The item gives the Chairman of the
Board the authority to sign the Resolution when the entity is known. The Board does
not have the authority to object to any assignment but does have the liability of possibly
paying the wrong entity if AmReit does not keep the City informed as to who is entitled
to payments.
Boardmember Phillips stated he would like to see this item amended to require that if
the reimbursements are assigned to another entity, that entity would be required to
notify the Board to minimize the liability.
Boardmember Loessin stated he would like to table the item to allow him to receive
more information.
Sue Darcy Marsh Darcy Partners, Inc, stated the Board cannot prevent AmReit from
assigning the reimbursement, but the concern is the future assignments.
Boardmember Davis stated once AmReit assigns the reimbursement, they will be
responsible for who the reimbursement is given to because they are the entity that
made the assignment.
Boardmember Phillips stated he believes the issue of future assignments can be
addressed in the document to keep the Board informed of who the reimbursement is
currently assigned to.
Tim Ng, AmReit, stated there is concern about future assigning, but this Resolution is
stating the Chairman of the Board has the authority to sign the Consent to Assign and
the Board will be aware to whom the reimbursement has been assigned.
Boardmember Phillips stated once the reimbursement is assigned to an entity, that
entity has the right to assign the reimbursement to another entity without informing the
Board. He stated he would like the document to state the Board is only responsible for
the one-time assignment and no future assignments. The other option is to not approve
the consent to anything and not be responsible for any assignment.
Tim Ng, AmReit, stated, because the pace of the transactions is so fast, approving this
item now would allow them to expedite the process.
Page 6 of 7 — 8/25/2008 — TIRZ No. 2
Boardmember Loessin made the motion, seconded by Boardmember Phillips, to table
Resolution No. RTIRZ-2008-06 to allow Boardmembers to review the material.
Boardmember Loessin stated he would like to see items of this nature provided in
advance to allow Boardmembers to review it more thoroughly.
Boardmember Cook stated he believes the item should not be tabled, but no action
should be taken until AmReit has determined the entity to whom it is assigning the
reimbursement.
Discussion ensued between Boardmembers, Trey Lary, Allen Boone Humphries
Robinson LLP, Sue Darcy Marsh Darcy Partners, Inc, and Tim Ng, AmReit regarding
the Resolution.
After discussion, no formal action was taken by the Board.
ADJOURNMENT
Meeting was adjourned at 5:11 p.m.
Minutes approved as submitted and/or corrected this the 30th day of March, A.D., 2009.
ATTEST:
Mike y urn
Secretary
Nigel Harrison
Chair
Page 7 of 7 — 8/25/2008 — TIRZ No. 2