RTIRZ-2010-05 - 2010-06-07RES+�]I�UTIQN IVQ. RTIRZ-2010-fl5
A RESOLUTION OF THE TE"s►X IEVCR�MEN� REfNVESTMENT ZOf�E
NO. 2(TIR�), APPI�OVI'NG AN ENGAGEMENT L�TTER WITH
MCGRATH & CO., PLLC FOR SERVICES FOR THE ZONE
BE IT RESOLVED BY TI�tZ BC}ARD OF I�fRECTORS:
Sectian 1. That the TIF�Z hereby approves engagir�g McGrath & Ca.,
PLLC for servic�s outlined in the at�ached proposaa �ursuant tQ the hourly rates
as attac�ed.
PASSE�, APPROV�D, AND ADOPTED this 7 day �f June, A.D., 2�� 0.
_�.
�JIGEL HARRI�QN
T`RZ No. 2 CHAIRM,AN
ATTEST:
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TIRZ No. 2 SEGRETARY
IVIcG�-ath �& �o., �'LL�C
Ce�•ti�ied Public �►.c�ount�n�s
P.O. Bo.r?7ni-4R
Iloustan. Te�as 77?77
\lark �1, ticGrath CP:�.
mark r c. mcerath-co.cam
\�tay 2�, 2Q 10
Board of Directacs
I�eirlW�est�n�«t Zone No. 2,
CiTy of Pearl�tnd, Te:�as
ColeTte \1. Garcia CPA
caletke{ri mcgr��tk�-cc�.cnm
��'e are ple:asecl to coi�tirni otir understand'u�� c�f t[le sen�ices we are ta �ros�ide for R�n7vestn�er�d Zoc�� No. 2,
City of Pearlanci. T��as (the �one}. C)ur sen ices ���ill ulclucfe, l�ut not necessanly b� li�zuted t�. res ie«� of
de��e�oper.'sut� developer i��fc�nn�tian it� acco��dr�nce «�it�� the Zot�e's �ic�al TIRZ P�an ancl th� Bo�rcis' P�•oject
hrr��l�r�rE�at�atioFi crra�l Reinrbrr�sc��rc�fat P1 in pa of the Zone's �.«nual F�nanci�l Report in
accordance with its enablin� 1��7rsl�tion. and �ssistanc� ta ttle Board's co�l�n�ittee responsible to�• revie�vi«{�
�1C111llIllSt1°c�t1Ve LI]VOIC�S. 4
pF'(1J('Cf �11lfJ1CfIJL'!llLdrl(YIi (i31[l �iE'!!1l13llPSL'il1L'lll` �f'(1t�tiS
�Ve ���111 �pe�rf�rn� �ertain a�1•eed titpo�i procedui•es in r�:�ards to amounts ci��t�elopersis�Eb-de�-elopers have
expended for specitied praj�:cts. Our pracedur`cs are expe�ted to be as follo�vs:
�'e ��.�ili re��,-ier�� the a�pr��priate finan�ei��� a�rec;iner�ts, u�cluc�iil� arty LetCer F�lancurg
4�ree�n����s, ic�entifyin� constructiQ�7 projects ancl authoi�izul� funire i•eimbEUSeni�nt.
'?. �v�'e ���a11 re�°ie{�� doc��menCS sub»>ittzd Uy tt�e de� el���er. The:sc docu�l�ent� shall include
it1E�c�ices and`or c�ntr�ti�;ts, �loi��� �;eittl �r of �ay��nent. �t�'e Ee ciet�irnine that thcse
�tmouc�ts are a��prc�priate for rei�zlt�ur�sem�nt.
3. �4'e prep�r� calcu�atians of i�t�rest ciue the ci���eloper isl accordance �vitf� the De��elo�ment
:�.�•eemei�t a�7d Fiil�ncir�� .��t��eaile�it. ff sucli calcu�ations aa�e pc�e�ared t�y tl�e cie� wve
�vill test them far cc,mpliance �E�it3i t��i: a��
-�. �^� ��'lj� ["�\'@Z\l' C�le '��'(3C�i �J� tll� �LOIl� 5 F.[]`'lllZ�l" 06' CC717S11�1Ck1(lI3 :=�,1[f�d[OI`, a1S �l]J�C'llEJl'111t�, tC�T'
CC)I]Sl5$�11CV �1'lXf3 0111' �117C�1t�`�?J ilI1C� COl1����1i137C� ��`lk�] t�12 z011� �1'O��Ct P�i1I1, Z.C)i1P. FI1121llClllti
Plan an�� I3ud���t, and �inaa�cig��� a�=re�nlee�ts. iucludin�� a��y Letter Fi»a��ci���r r"+�rzements, anc�
othez ci�cusnealts, if ap��licavle.
1�8��� �
iVIaV ?�. ?� 1 O
�'e ���ill }��rloini other procedures �nd kests as �ansiclered ne�.essary• to deter�nifie c��npliance
1��it1� the Zot�e's Prajectl11t1}lc�r�relrtatio�t �rlrrlliE:i��rl�tifser��e�ttP��n��c:s.y�.
��'e shall prep��re a reiiiibur�ert�ent r�pcjt�t dctaili�l, tlie �r�czduc l� e p�rfi�n��ed �n��i a�nounts
to be reiml�ursed.
We ���ill zt�•�n�e n�itl� the Zone �t1d th� des�elopersr',ub-dewelopers ta obt�in all necessary info� and
corr°es�t�«c3enee pertauui�g to a�ai report. If rec�uu�ecl uifonriation or assistance is not readily nlade ��•ailai�le to
us, ��_� «°ill nc?tif}- 4�o�i as soon as �ossi�le in ar�l�r ta i�,1a�e �pprapnate arraz��e�lients for tin�el�� completion of
c�ur repo�t.
Annunl Financial Repor#
The Zone's �n�blin� le4islation re�uires an ai��u�l report be preparc:ci clescribin�� the status of the projeet.
Such r�pc�1 «�ill enclude a bucl�=c:t and �ctual cotnp�rison far th� project �nti tlie attainalle��t of certai«
�nilc:stones, uicludul=� ka� increnient ancl b��ild o�it.
W'e �i�ill ti��ork «�ith Zc�ne's <4c�miiustratc�r �nd le�al counsel re`ardin� tc� ascertain the specific contents of tlle
re�aort. ��:'e ��;�ilL tl�,eii obtayn the nece�sary intornlation, �re�are the report and p1'eset�t it to tlie B�ard.
F�ssist��nce to �dminisfi Im aice CoRiFnittee
`�'e nill assist the Board's ca���nlittee revie���in� ad��iiiustrative uzvaices on an as neeciec� basis. Such
assistan�e �.� il1 inclucie a ret�ie�E� of ins�oices for cantr3ctual conzpliance, contoa t�'ith tfle Zone's buddet,
mathen�atical accur•acy, anci other areas as reques�ed l�y the Bt�ard or Con�n n�embers.
O�.ir fees tor these sei iees tvill be b�sed on tlie acriial tia��e spe��t, �lus trati�el anci other out-�f-p�cket costs
saae(1 as repoe p�oductian, typinQ, }�astage, etc, C�ti�r standar�l houz�ly rates may chan�re ot�er time and va���
aecorelin� to the de�ree nf res�3�nsil�ility irjvc�l��ed ancl the e�penence level of the }�ersa�ulel assr��hled to ycrur
reE�o��t. ��lr cui��ent� rate sclledule is aCtached t� this letter ancl «�ill ren�ai�l i�� effect �e�r a or�e year pea
Chr�n��es to st�nd�rci r�tes «�ill be preser_�ted tc� [he Ba�rd aiurually thereatter. O�ar �E»•o�ees for these t�e� n�ilf
l�e �ret�dered upoi7 c4mplztion c�f eacli ,�roject 3��d �f•c paya�le on p�re�eni�tion. 1�'c �itic��a the
de��elaper'sub-de�elopers are respof��il�l� f�r payiilr� e�ur in�aic�s E�•�r� t��� ��zrfo� under tlie Zar�e's
P�•c�jc�ct fnr��le��ic>>ttrFtr��r rry7�� f�Eia��l�ir�:ccr�i��rzt Proc�ss,
Tl�is a��re��i}ent i� canLelal�le bv cithcr }�ai�}° �; itli tlwrty days «ritten nc�tice.
McGrath & Co., PL�.0
Rat� Scheduie
5/1C7/2�10
Name
Mark McGrath CPA
Calette Garcia CPA
Kinrr Thurmond CPA
Becky Reynalds
Louis Swinda9l
John Graham
Robert Fien@ff
Crystal �orn
Mel�nda Myers
Tayo Illori
Greg McGr�th
P�51t1081
Owner
Principal
5upervisor
Supervisor
Senior Staff A�ditor
5enicar Staff Auditcrr
Staff Auditor
5tagf Audiior
Staff Auditor
Staff Auditar
Staff Auditor
Rare Per Hour
225
175
125
�25
95
95
85
sa
85
85
80
Page 3
May 24, 2010
We appreciate the opportunity to be of service to the Zone and believe this letter accurately summarizes the
significant terms of our engagement. If you have any questions, please let us know. If you agree with the
terms of our engagement as described in this letter, please sign the enclosed copy and return it to us.
Sincerely,
McGrath & Co., PLLC
By: Mark W. McGrath
RESPONSE:
This letter correctly sets forth the understanding of Reinvestment Zone No. 2, City of Pearland, Texas.
By: --�_
Title: TIRZ No. 2 Chairman
Date: June 7, 2010
McGrath & Co., PLLC
Certified Public Accountants
P.O. Box 270148
Houston, Texas 77277
Mark W. McGrath CPA
mark@mcgrath-co.com
May 24, 2010
Board of Directors
Reinvestment Zone No. 2,
City of Pearland, Texas
Colette M. Garcia CPA
colette@mcgrath-co.com
We are pleased to confirm our understanding of the services we are to provide for Reinvestment Zone No. 2,
City of Pearland, Texas (the Zone). Our services will include, but not necessarily be limited to, review of
developer/sub developer information in accordance with the Zone's final TIRZ Plan and the Boards' Project
Implementation and Reimbursement Process, in preparation of the Zone's Annual Financial Report in
accordance with its enabling legislation, and assistance to the Board's committee responsible for reviewing
administrative invoices.
Project Implementation and Reimbursement Process
We will perform certain agreed upon procedures in regards to amounts developers/sub-developers have
expended for specified projects. Our procedures are expected to be as follows:
1. We will review the appropriate financing agreements, including any Letter Financing
Agreements, identifying construction projects and authorizing future reimbursement.
2. We will review documents submitted by the developer. These documents shall include
invoices and/or contracts, along with proof of payment. We will determine that these
amounts are appropriate for reimbursement.
3. We prepare calculations of interest due the developer in accordance with the Development
Agreement and Financing Agreement. If such calculations are prepared by the developer, we
will test them for compliance with the agreement.
4. We will review the work of the Zone's Engineer or Construction Auditor, as appropriate, for
consistency with our findings and compliance with the Zone Project Plan, Zone Financing
Plan and Budget, and financing agreements, including any Letter Financing Agreements, and
other documents, if applicable.
Page 2
May 24, 2010
5. We will perform other procedures and tests as considered necessary to determine compliance
with the Zone's Project Implementation and Reimbursement Process.
6. We shall prepare a reimbursement report detailing the procedures we performed and amounts
to be reimbursed.
We will arrange with the Zone and the developers/sub-developers to obtain all necessary information and
correspondence pertaining to our report. If required information or assistance is not readily made available to
us, we will notify you as soon as possible in order to make appropriate arrangements for timely completion of
our report.
Annual Financial Report
The Zone's enabling legislation requires an annual report be prepared describing the status of the project.
Such report will include a budget and actual comparison for the project and the attainment of certain
milestones, including tax increment and build out.
We will work with Zone's Administrator and legal counsel regarding to ascertain the specific contents of the
report. We will then obtain the necessary information, prepare the report and present it to the Board.
Assistance to Administration Invoice Committee
We will assist the Board's committee reviewing administrative invoices on an as needed basis. Such
assistance will include a review of invoices for contractual compliance, conformity with the Zone's budget,
mathematical accuracy, and other areas as requested by the Board or Committee members.
Our fees for these services will be based on the actual time spent, plus travel and other out-of-pocket costs
such as report production, typing, postage, etc. Our standard hourly rates may change over time and vary
according to the degree of responsibility involved and the experience level of the personnel assigned to your
report. Our current rate schedule is attached to this letter and will remain in effect for a one year period.
Changes to standard rates will be presented to the Board annually thereafter. Our invoices for these fees will
be rendered upon completion of each project and are payable on presentation. We understand the
developer/sub-developers are responsible for paying our invoices work for performed under the Zone's
Project Implementation and Reimbursement Process.
This agreement is cancelable by either party with thirty days written notice.
Page 3
May 24, 2010
We appreciate the opportunity to be of service to the Zone and believe this letter accurately summarizes the
significant terms of our engagement. If you have any questions, please let us know. If you agree with the
terms of our engagement as described in this letter, please sign the enclosed copy and return it to us.
Sincerely,
McGrath & Co., PLLC
��' L �'. & 41" -�L-
By: Mark W. McGrath
RESPONSE:
This letter correctly sets forth the understanding of Reinvestment Zone No. 2, City of Pearland, Texas.
By:
Title:
Date:
McGrath & Co., PLLC
Rate Schedule
5/10/2010
Name
Mark McGrath CPA
Colette Garcia CPA
Kim Thurmond CPA
Becky Reynolds
Louis Swindall
John Graham
Robert Heniff
Crystal Horn
Melinda Myers
Tayo Illori
Greg McGrath
Position
Owner
Principal
Supervisor
Supervisor
Senior Staff Auditor
Senior Staff Auditor
Staff Auditor
Staff Auditor
Staff Auditor
Staff Auditor
Staff Auditor
Rare Per Hour
225
175
125
125
95
95
85
80
85
85
80