[8. Receive, consider and act upon emergency authorities related to the Coronavirus (COVID-19) pandemic, and authorizing the President/General Manager to act in connection therewith;]

RECEIVE CONSIDER AND ACT UPON EMERGENCY AUTHORITIES RELATED TO COVID 19 PANDEMIC AND AUTHORIZING THE PRESIDENT OR GENERAL MANAGER TO ACT IN CONNECTION WITH THEIR

NECTION WITH THEIR WITH. >> GOOD EVENING BOARD. I JUST WANT TO GIVE A QUICK UPDATE ON SOME OF OUR PROGRESS WE HAVE BEEN MAKING AS IT RELATES TO CHRONICLERS FUNDING THE BOARD HAS BEEN PROACTIVELY WORKING ON FOR THE LAST 18 MONTHS OR SO.

AS YOU WILL OBVIOUSLY RECALL LAST YEAR CONGRESS APPROPRIATED ABOUT HUNDRED AND $50 BILLION FOR STATE AND LOCAL GOVERNMENTS. THROUGH THE CARES ACT AND GAVE THAT MONEY TO STATES INTO DIFFERENT TRANCHES.NE WENT TO STATES DIRECTLY AND FOR COUNTIES LARGER THAN 500,000 POPULATION OR CITIES LARGER THAN 500,000 POPULATION AND GIVE THEM A DIRECT ALLOCATION. AND SO WHAT I'M BRINGING TO TONIGHT'S PROGRESS WE'VE MADE.

AS I WAS SAYING THE SIERRA FUNDS ARE RELEASED AND THE TOWNSHIP APPLIES WITH AN APPLICATION THAT WE HAVE FOR MONTGOMERY COUNTY FOR AN EQUIVALENT OF $5.1 MILLION IN ELIGIBLE FUNDS. UNFORTUNATELY AT THAT TIME THE TOWNSHIP WAS NOT GIVEN FUNDED FOR THE FULL 5.1 MILLION IN ALLOCATION BUT WAS ACTUALLY GIVEN ABOUT $200,000.

WE'VE BEEN PURSUING A REMEDY WITH THE STATE AND COUNTY TO FIGURE OUT WHERE THE FUNDING MAY BE AND HOW THE TOWNSHIP IS TO ACQUIRE DETECTABLE SHARE OF FUNDING.

IN JULY APPROVED THE BOARD THAT THEY HAD A MEETING IN THE COUNTY TO DISCUSS THE FUNDING SITUATION AND WHERE WE SHOULD BE LOOKING FOR OUR FUNDS. ONE OF THE QUESTIONS THAT CAME UP WAS WHETHER THE ATTORNEY GENERAL'S OPINION IS REQUESTED ABOUT THE TREASURY RULES AND HOW THOSE FUNDS SHOULD BE DISTRIBUTED IN LARGER THAN 500,000 POPULATION AND I HAVE LOCAL SURE STATIONS WITH FEWER THAN 500,000 LIKE THE LOCAL JURISDICTIONS WITHIN MONTGOMERY COUNTY. WHAT YOU SEE THIS WEEK IS THE ATTORNEY GENERAL POSTING AND OPINIONS REQUEST FROM SENATOR CRAYTON ASKING THAT VERY QUESTION.

THE SENATOR OUTLINES A COUPLE THINGS LETTER. FUNDS CAME DOWN AGAIN IN TWO TRANCHES ONCE ACCOUNT IS LARGER THAN 7000 AND THE STATE FUNDS WERE REQUIRED TO BE DISTRIBUTED TO LOCAL GOVERNMENTS. THE STATE OF TEXAS THAT'S A BETTE RATE OF $55 PER CAPITA AND YOU'LL SEE THAT NOTED IN THE LETTER. FOR THE 12 COUNTIES IN THE STATE LARGER THAN 500,000 THOSE CASES AND COUNTIES MADE AVAILABLE TO LOCAL JURISDICTIONS UP TO $55 PER CAPITA RATE WITH ONE EXCEPTION. MONTGOMERY COUNTY AND WE'VE BEEN PURSUING THAT RATE OF $55 PER CAPITAL. THERE ISSUED AN OPINION WITH A LITTLE JURISDICTION OF LESS THAN $500,000 TO GET THE CURRENT RELIEF FUNDS WITH A COUNT OF GREATER THAN 100,000. IT WAS POSTED THIS LAST WEEK AND WE HAVE IF YOU DON'T KNOW THE EXACT TIMELINE FOR REPLY BUT THIS IS A GOOD STEP. OBVIOUSLY WE CONTINUE TO WORK ON OUR RELATED FUNDS AS IT RELATES TO CORONAVIRUS AS WELL AND SO WE WILL BRIEF THE BOARD IN THE COMING WEEKS AND SOME OF THE PROGRESS WE'RE MAKING THERE AS WELL.

>> CHAIRMAN: THANK YOU FOR THE UPDATE. I ALSO WANT TO POINT OUT A FEW THINGS. I HEARD COMMISSIONER NOWAK IN NUMEROUS SPEECHES THE LAST FEW WEEKS TELLING OUR COMMUNITY THAT THE WOODLANDS TOWNSHIP IS NOT ELIGIBLE FOR THE CARES ACT.

CAN YOU OUR ELIGIBILITY? >> UNDER THE CARES ACT WE ARE IN ELIGIBLE ENTITIES.

THE CARES ACT DIFFERS FROM THE AMERICAN RESCUE PLAN ASKED WHICH RELATES TO PARTICULAR

[00:45:01]

DEFINITIONS OF YOUR GOVERNANCE STRUCTURES UNDER THE CARES ACT LOCAL GOVERNMENTS ARE MANY TYPES ELIGIBLE FOR FUNDING AND WHILE SURGERY HAS NOT INDICATED IN WRITING THEY HAVE SET VERBALLY TO OTHER PARTY AT THE FEDERAL AND LOCAL LEVEL THAT WOULD QUALIFY AS AN ENTITY TO

BE REIMBURSED FOR EXPENSES. >> AND OTHER COMMENTS THAT THE COMMISSIONER HAS MADE THE TOWNSHIP HAS BEEN FUNDED WITH EXPENSES THAT WE ARE ELIGIBLE FOR.

>> I THINK THAT STATEMENT IS INCORRECT. WE CLEARLY HAVE AN APPLICATION DOCUMENTATION SHOWING OUR EXPENSES STILL HAVE OUTSTANDING ABOUT $5.8 MILLION IN EXPENSES UNDER THE CURRENT AFFAIRS RELIEF FUND. IN THE CASE OF MONTGOMERY COUNTY WHEN THEY PUT OUT THE CRITERIA OF LOCAL JURISDICTIONS THEY DID TWO THINGS IN PARTICULAR. THEY RESTRICTED THE DATE BY WHICH YOU COULD INCUR THOSE EXPENSES AND THEY ALSO TYPES OF EXPENSES THAT WERE ELIGIBLE FROM THE LIST OF THE CONVERSE BUILT ITSELF ALLOWS. ONE OF THE THINGS THAT THEY DID NOT ALLOW REVERSE BEFORE WAS PUBLIC SAFETY PERSONNEL EXPENSES RELATED TO SALARY AND OVERTIME.

OBVIOUSLY THE FIRE DEPARTMENT BEING ON THE FRONT LINE TO THE PANDEMIC WE HAVE A SIGNIFICANT COST RELATED TO BOTH OVERTIME, COURT COSTS OF ACTIVITIES WHICH THE COUNTY DID NOT ACCEPT ANY APPLICATION FOR. WE SUBMITTED THEM TO THE COUNTY IN ADDITION TO THOSE ELIGIBLE EXPENSES THAT THEY LISTED IN THE CRITERIA THAT WE DO NOT GET FOR THOSE.

>> WHAT ARE THE CATEGORIES THEY FIND THEMSELVES FOR PUBLIC SAFETY.

>> YES SIR. THEY HAVE SET ASIDE ROUGHLY $50 MILLION IN ALLOCATION FOR

PUBLIC SAFETY RELATED EXPENSES. >> JUST FOR THE AUDIENCE THAT ME NOT BE FOLLOWING THIS WE CURRENTLY FUNDS CLOSE TO $14 MILLION PER YEAR AND LAW ENFORCEMENT FOR THE TWO COUNTIES. THE COUNTY MADE THEMSELVES ELIGIBLE FOR REIMBURSING THEIR OWN LAW ENFORCEMENT BUT NOT THE LAW ENFORCEMENT THAT WE FIND WITH THE ACTUAL SERVICE PROVIDER. THAT DOESN'T MAKE ANY SENSE. I WAS ELIGIBLE FOR THE ELIGIBLE

FIRST? >> THAT'S ONE OF THE REASON WE WERE FIGHTING FOR THE COUNTY FOR A YEAR AND HALF PEOPLE ARE HEARING A LOT OF ACTIVITY FROM THE COMMISSIONER AND WE'VE BEEN FUNDING EVERYTHING WE DO. WE ARE NOT ELIGIBLE. THE FACT IS WE ARE ELIGIBLE AND THEY WERE DIRECT ARE SEPARATE BECAUSE OF OUR POPULATION SIZE. IT WAS INTENDED TO BE PASSED THROUGH TO US AND THEY CREATED THEIR OWN RULES WHICH IS THE ONLY COUNTY INSTEAD OF TEXAS TO DO SO. WE ARE CURRENTLY ARGUING OVER $5.8 MILLION WILL BE TO TAKE A DETERMINATION THAT, DILIGENCE ON THIS AND THIS IS THE ONLY EFFORT.

GOT TO THE STATE AND THE FEDERAL GOVERNMENT. NOW GO TO THE ATTORNEY GENERAL HOPEFULLY IT WOULD BE ADJUDICATING TO GIVE US GUIDANCE ON WHERE THE ARTICLE BECAUSE THE COUNTY IS TELLING US THEY DIDN'T GIVE US THE MONEY BECAUSE THEY DIDN'T HAVE TO. EVEN THOUGH THE GUIDELINES ARE PRETTY FROM THE GOVERNOR'S OFFICE THE $55 PER CAPITA FROM THE LOCAL GOVERNMENT DID NOT SAY SHALL FUND.

JUST THINK ABOUT THAT. BECAUSE I DIDN'T HAVE TO I'M NOT TO GIVE YOU THE FUNDING INTENDED TO COVER YOUR COMMUNITY. IT'S WRONG.

THEY HAVE ASKED US TO APOLOGIZE TO THEM FOR CALLING THEM OUT FOR.

I'M NOT GOING TO APOLOGIZE AND OF THE OF YOUR SHED. >> ANY OTHER QUESTIONS FOR

TODD? >> ANY UPDATE MISTER STEVENS ON THE FUNDING? I KNOW WE MAY QUALIFY FOR 30 MILLION BUT IF WE ARE NOT A CITY WOULD WE STILL FAIL TO BE RECOGNIZED AND ABSOLUTELY NOT QUALIFY FOR ANYTHING GOING FORWARD? IT'S A MUCH BIGGER AMOUNT OF MONEY AND MORE MONEY MAY BE COMING DOWN THE ROAD FROM THE

FEDERAL GOVERNMENT LIKE ARBOR SOWS ANYTHING CHANGING THEIR? >> WE'VE HAD PUBLIC COMMENTS AND BY THE JULY DEADLINE AND MAKING AN ARGUMENT FOR WHY WE DID QUALIFY AS A JURISDICTION TO RECEIVE FUNDING. THE TREASURY HAS GIVEN US A RESPONSE.

IT WAS A DEFINITION TO BE IN AN INCORPORATED AREA WITH THE DIVISION IN THE STATE OF TEXAS.

WE CONTINUE TO OBVIOUSLY PURSUE CONVERSATIONS WITH TREASURY AS WELL AS WHITE HOUSE AND CAPITOL HILL LEADERSHIP. WE MADE OUTREACH TO THOSE AND MADE CONTACT.

[00:50:04]

WE STILL WORK TO THOSE ISSUES. WE DON'T HAVE THAT RESULT BUT WE'RE MAKING PROGRESS.

WE HOPE TO COME BACK AND GET THE 40 UPDATE. >> LET'S JUST REMIND FOLKS THAT MAYBE DON'T KNOW. THEY QUALIFY FOR WHAT THE AMOUNT IS.

HOW MUCH OF THE FUNDING UP TO? >> IS ESTIMATED TO BE UP TO $30 MILLION.

THERE ARE TWO DEFINITION CATEGORIES. >> THAT IS DIRECTLY FROM TREASURY TO US. IT IS NOT TO GO THROUGH MONTGOMERY COUNTY OR PARIS

COUNTY. >> IT'S THE ONE CASE WHERE THE FEDERAL GOVERNMENT ACTUALLY ALREADY ALLOCATED ALLOCATIONS TO LOCAL GOVERNMENT. IT'S ONE OF THE ONLY TIMES AND

ARTIE DONE THAT. >> STATED THAT WITHOUT US DOING.

THAT'S THE CARES ACT MONEY JUST TO DIFFERENTIATE. THEY GAVE A $715,000.

WITHOUT US EVEN PUTTING IN AN APPLICATION. >> WE DID HAVE TO OBVIOUSLY SUBMIT MATERIAL SUPPORTING THE FUNDING ALLOCATION BUT THE WAY HARRIS COUNTY STRUCTURE THAT THEY CREATED WHAT THEY CALL THE SMALL CITIES PROGRAM WHERE THEY PROACTIVELY DECIDED TO PROVIDE UP TO $55 PER CAPITA TO THE POPULATIONS WITHIN THE COUNTIES.

THEY INCLUDED US ON THAT LIST AT A RATE OF $715,000 WHICH IS EQUIVALENT TO $50,000 PER CAPITA.E APPLIED OUR EXPENSES WHICH THEY APPROVED AND PROVIDED US THE FULL SET.

>> IT'S MUCH MORE OF A COLLEGIAL WORK OVER RELATIONSHIP.

WE JUST PROVIDE THE DATA AND THEY SAID NE. I'D LIKE TO ASK YOU HOW MUCH

CARES ACT MONEY DID MONTGOMERY COUNTY RECEIVED? >> THE ALLOCATION WAS $505 MILLION SHOULD REMEMBER THE NUMBER BUT IT'S JUST UNDER 118 MILLION.

ARPA FUNDS AS A REMINDER TO THE FORT ARE PERPETRATED OVER TWO YEARS AND 50% THIS YEAR AND 50% WHEN YOU'RE AFTER. THOSE FUNDS ESSENTIALLY MADE THEIR WAY TO LOCAL COMMUNITIES OVER THE LAST COUPLE OF MONTHS AND SO THEY WILL RECEIVE HALF OF THAT AND THE OTHER HALF THIS

TIME NEXT YEAR. >> I'M JUST WANTING THE RESIDENTS TO KNOW THAT THEY HAVE THE FEDERAL GOVERNMENT BEING VERY GENEROUS TO MYTHOLOGIES AND COUNTIES ACROSS

THE UNITED STATES. >> CORRECT AS OF NOW WITH THOSE TWO PIECES OF LEGISLATION THE CARES ACT AND THE AMERICAN RESCUE PLAN CONGRESS HAS APPROPRIATED ABOUT $500 BILLION TO LOCAL STATE AND GOVERNMENTS FOR CHRONICLERS RELIEF AND RESPONSE.

>> CHAIRMAN: WE ARE STILL SITTING AT ZERO AND WE LOOK AT AN UPDATE ON THAT AS YOU CONTINUE WITH THE APPEAL PROCESS. WERE SELECTIVELY GOING AFTER THAT. I THINK DOCTOR SNYDER HAD AN UPDATE ON SOMETHING FOR

METHODIST HOSPITAL. >> THE WOODLANDS BOARD MEMBER I RECEIVE DAILY UPDATES FROM THE MEDICAL CENTER. WE JUST WANT TO SHARE WITH THE BOARD THAT WE ARE SO APPRECIATIVE AND GRATEFUL THAT THE DAILY CHRONICLERS UPDATES WITH THE TOWNSHIP IS DOING AS WELL AS IMPLEMENTING AND SUPPORTING THE SAFETY PROTOCOLS.

WITH THAT SAID HOUSTON METHODIST WOODLANDS DID SEE A HIGHER NUMBER OF INPATIENT ON AUGUST 30, 2021 IN JULY AND AUGUST 2020 AND JANUARY OF 2021.

SYSTEMWIDE THE INPATIENT ADHESIVE METHOD ARE THROUGHOUT THE GREATER HOUSTON AREA WAS IN 2020. THEY ARE UNVACCINATED. WE ENCOURAGE US TO CONTINUE TO

UPDATE THE SAFETY PROTOCOLS OF THE TOWNSHIP. >> THANK YOU DOCTOR SNYDER AND

YOUR TEAM FOR THE UPDATES. >> WE TAKE A MOTION TO SECOND THE REPORT.

[9. Receive, consider and act upon Incorporation Planning Study matters (as requested by Chairman Bunch); ]

>> MOVED TO ACCEPT. >> SECOND. >> THOSE IN FAVOR SAY AYE.

ANY EXTENSIONS? >> RETURNED ITEM 9. IT'S A CORPORATION PLANNING STUDY

MATTERS AND WE'RE GOING TO START WITH KAREN DEMPSEY. >> ALWAYS BEEN TALKING ABOUT

[00:55:14]

EACH MONTH THE BOARD INITIATED A STUDY IN 2018 WHICH CONTINUED THROUGH 2020.

IT WAS THEN PUT ON HOLD BRIEFLY DURING THE PANDEMIC WAS RESTARTED THIS YEAR.

ON AUGUST 13 THE BOARD DID CALL AND ELECTION FOR INCORPORATION. THERE WILL BE TO APPROPRIATE PROPOSITIONS THAT APPEAR IN THE WORDING WILL BE DEVELOPED BY LEGAL COUNSEL BASED ON REQUIREMENTS AND STATE INCLUDING LEGISLATION. PROPOSITION A CREATES THE CITY OF THE WOODLANDS AND ALSO SETS THE INITIAL TAX RATE. THE RESIDENTS CAN VOTE FOR OR AGAINST THIS MEASURE AND THE EXACT WORDING IS AUTHORIZING THE TAIPEI CITY INCORPORATION OF THE WOODLANDS TOWNSHIP IN THE ADOPTION OF INITIAL PROPERTY TAX RATE OF NOT MORE THAN 22.31 CENTS FOR HUNDRED DOLLARS OF EVALUATION OF TAXABLE PROPERTY.

PROPOSITION TWO DEPENDS ON PROPOSITION EIGHT PASSING. IT TRANSFERS THE RIGHTS AND RESPONSIBILITIES WITH AUTHORITIES FOR THE CITY OF THE WOODLANDS TO VAULTING DISSOLVING THE TOWNSHIP. AGAIN VOTERS CAN VOTE FOR OR AGAINST US MEASURE AND THE WORDING FOR PROPOSITION B IS UPON INCORPORATION DISTRICT AND TO TYPE A GENERAL LAW CITY TO BE CALLED THE CITY OF THE WEAPONS. IT IS THE AUTHORITY TO ISSUE BONDS AND IMPOSE TAXES FROM THE WOODLAND TOWNSHIP DISTRICT TO THE CITY OF THE WOODLANDS.

A COUPLE OF KEY DATES THAT ARE COMING UP OUR OCTOBER 4 WHICH IS THE LAST DAY TO REGISTER TO VOTE. OCTOBER 18 IS THE START OF EARLY VOTING.

OCTOBER 22 IS THE LAST DAY TO APPLY FOR A BALLOT BY MAIL. OCTOBER 29 IS THE LAST DAY FOR VOTING BY PERSONAL APPEARANCE AND NOVEMBER 2 ELECTION DAY. A COUPLE OF RESOURCES FOR ANYONE THAT IS INTERESTED FOR VOTING ELIGIBILITY THIS IS A QUESTION THAT WE HAVE GOTTEN A NUMBER OF TIMES IN ORDER TO VOTE IN THE SELECTION IT IS A GOVERNMENTAL ELECTION AND YOU'RE REQUIRED TO BE REGISTERED TO VOTE IN THE COUNTY OF YOUR RESIDENCE.

YOU CAN RESIDE IN THE WOODLANDS TOWNSHIP. IF YOU ARE INTERESTED IN TAKING A VOTER REGISTRATION OR LOOKING FOR YOUR SPECIFIC INCREASING NUMBER THE INFORMATION IS AVAILABLE ON THE COUNTY WEBSITE AND YOU CAN LOOK IT UP BY YOUR NAME.

FOR MONTGOMERY COUNTY THAT IS A B2B W.MONTGOMERY VOTES.ORG AND FOR HARRIS COUNTY THAT IS

DEBBIE DEBBIE DEBBIE.HARRIS VOTES.ORG. >> NEXT WEEK WE WILL BE HAVING AN EDUCATIONAL MEETING. AT THE MEETING WE WILL HAVE THE CONSULTANTS WHO WORKED ON OUR STUDY AS WELL AS OPPORTUNITIES FOR MEMBERS OF THE PUBLIC TO ASK QUESTIONS OF THE CONSULTANTS. THE STUDIES ARE THE BASIS FOR THE INCORPORATION.

YOU CAN FIND THE EXACT WORDING OF THE PROPOSITIONS AS WELL AS NAMES AND BALLOT ORDER FOR THE DIRECTOR POSITIONS. WE DO HAVE ACCESS TO COMPREHENSIVE INFORMATION INCLUDING THE STUDIES THAT WERE THE BASIS. THERE ARE POWERPOINT PRESENTATIONS FROM THE AUGUST 13 MEETING. THERE ARE ALSO FAQS AND MORE.

>> ANY QUESTIONS FOR KAREN? IF NOT WE WILL NOT BRING UP MONIQUE SHARP.

>> GOOD EVENING EVERYONE. FIRST FOR THOSE OF YOU THAT DO NOT KNOW ME MY NAME IS MONIQUE SHARP. I'M AN ASSISTANT GENERAL MANAGER OF FINANCE AND ADMINISTRATION. I HAVE BEEN WITH THIS ORGANIZATION AND ITS PREDECESSOR WITH THE COMMUNITY ASSOCIATION OF THE WOODLANDS FOR 29 YEARS.

BASICALLY HAVE SPENT MY CAREER HERE. TONIGHT I'M GOING TO GIVE A

[01:00:08]

PRESENTATION ON THE INCORPORATION FINANCIAL MODEL BUT IT'S NOT REALLY A PRESENTATION NOT WAS GIVEN BEFORE SEVERAL WEEKS AGO ON THE ACTUAL DIFFERENT MECHANICS OF THE MODELS. I'M NOT REALLY GOING THROUGH EVERY COMPONENT OF THAT.

TONIGHT I'M GOING TO BE ADDRESSING SOME INFORMATION THAT HAS BEEN PRESENTED ON THE COMMUNITY AND I'M KNOCKING TO GET INTO WHOSE ASSUMPTION IS CORRECT AND NOT.

THAT'S NOT MY ROLE. MY ROLE HERE IS TO MAKE SURE THAT NOT JUST THE COMMUNITY IN TERMS OF WHAT YOU'RE LOOKING AT IN TERMS OF INCORPORATION BUT MINE IS SORT OF BROADER.

I HAVE A RESPONSIBILITY TO OUR BONDHOLDERS AND AUDITORS, BANKERS AND CREDIT AGENCIES TO MAKE SURE THAT THE INFORMATION IS ACCURATE AND TRANSPARENT. IT REALLY IS IN SHORT MICHAEL

TONIGHT. >> WITH THAT I REMIND EVERYONE THAT THERE ARE DIFFERENT COMPONENTS OF THE INCORPORATION AND INTRO MODEL. ONE OF THOSE IS THE INCORPORATION REVENUES AND EXPENSES THAT WERE DEVELOPED BY THE NOVAK CONSULTING GROUP.

I KNOW THAT THEY WILL SPEND SOME TIME NEXT WEEK INFORMATIONAL MEETING THAT MISSED EMPTY JUST TALKED ABOUT. IT IS THE FIVE-YEAR PLAN THAT IS PREPARED BY TOWNSHIP STAFF PREPARED MY DEPARTMENT AND IT WAS REVIEWED AND ADOPTED BY THE TOWNSHIP BOARD AND THAT'S LARGELY WHAT I'M GOING TO SPEND MY EVENING TALKING ABOUT TONIGHT.

THOSE TWO THINGS COMBINED EQUAL THE CORPORATION MODEL WHICH ARE THOSE TWO COMPONENTS MAKING UP MODEL. STARTING OFF ON HER MIND EVERYONE.

IN TALKING ABOUT FISCAL 25 BECAUSE THAT IS THE INCORPORATION HERE WHICH IS NOVEMBER AND WE'RE LOOKING AT FOR YEARS UNTIL THE COST IS FULLY AND AGAIN.

BASICALLY IT'S A TRANSITION OF LAW-ENFORCEMENT COSTS. THE BASE BUDGET WILL REMAIN REGARDLESS OF WHETHER OR NOT WE INCORPORATE. THERE'S ABOUT 6% THAT IS RELATED TO INCORPORATION REVENUES THAT ARE UNIQUE TO INCORPORATION.

IN TERMS OF EXPENSES IT'S BASICALLY THE SAME THING. THE BASE BUDGET REPRESENTS 89.1% OF TOTAL EXPENSES. NONE OF THAT CHANGES WHETHER THEY INCORPORATE OR NOT.

THE DIFFERENCE IS THE 16 MILLION REPRESENTS ABOUT 10% OF WHAT WE CALL THE INCORPORATION EXPENSES. THOSE ARE PRIMARILY LAW-ENFORCEMENT AND PUBLIC WORKS AND AGAIN WE TALK ABOUT THOSE LITTLE BIT MORE. WHAT I WANT TO START OFF WITH THIS TALKING ABOUT THE EXPENSES AND HOW THEY ARE FUNDED. WE HAVE PROJECTED EXPENSES IN 2025 RELATED TO INCORPORATION. THIS DOESN'T INCLUDE THE BASE BUDGET.

THIS IS JUST INCORPORATION. THE WAY THAT THAT IS BEING FUNDED AND THE MODEL IS TWO COMPONENTS. WHEN WE HAVE $9.7 MILLION IN NEW REVENUE WHICH IS ON THE SIDE YOU JUST SAW WHERE WE SHOW THE 6%. WE HAVE THE BASE BUDGET WE LOOK OUT TO YOUR 2025. WHEN I SAY NET REVENUE CAPACITY ANYTIME OBVIOUSLY THAT YOU ARE PROJECTING OUT YOU ARE MAKING A SET OF ASSUMPTIONS AND WHAT IS GOING TO HAPPEN.

IN OUR BASE BUDGET MODEL THERE ARE LITERALLY THOUSANDS. TENS OF THOUSANDS OF TRANSACTIONS THAT GO INTO THE BUDGET THAT WE BEEN CARRY OUT WITH CERTAIN ASSUMPTIONS INTO THE FIVE-YEAR PLAN.HESE ARE JUST A VERY SMALL PIECE OF THE DIFFERENT COMPONENTS THAT WE LOOK AT ONLY BUILDER FORECAST AND BUDGETING. I WANT TO TALK ABOUT FORECASTING BECAUSE THERE'S BEEN A LOT OF CONVERSATION AROUND THE TYPES OF ASSUMPTIONS

[01:05:02]

AND FORECASTING THAT WE DO. FOR THE TOWNSHIP THAT WE GET GUIDANCE ON OUR FINANCIAL FORECASTING GUIDELINES FROM THE THREE ORGANIZATIONS THAT YOU SEE THERE PRIMARILY THE GOVERNMENT FINANCE OFFICERS ASSOCIATION THERE'S OVER IN 1900 MEMBERS OF THE UNITED STATES WITH LOCAL AND STATE GOVERNMENTS. THE NATIONAL ADVISORY COUNCIL ON STATE AND LOCAL BUDGETING AND THE GOVERNMENTAL ACCOUNTING STANDARDS BOARD ARE GATSBY.

WHAT WE DO WHEN YOU READ THE MATERIAL WHICH OBVIOUSLY WERE NOT TO GO THROUGH THAT TONIGHT.

IT TALKS ABOUT DEVELOPING AN OBJECTIVE FORECAST AND A CONSERVATIVE FORECAST.

YOU WANT TO MAKE SURE THAT YOU ARE NOT OVERSTATING REVENUES OR UNDERSTATING EXPENSES.

SO THAT YOU CAN HAVE A SUSTAINABLE BUDGET THAT WILL GO INTO THE FUTURE.

WE ALWAYS TRY TO GET SOMEWHERE IN BETWEEN THERE AND LEANED TOWARDS THE CONSERVATIVE SIDE.

HOW OFTEN DOES THE TOWNSHIP UPDATE ITS ASSUMPTIONS? SALES TAX GROWTH IS REALLY WHAT THE ASSUMPTION IS AND WE TALK ABOUT SALES TAX. IT'S REVIEWED ANNUALLY DURING THE BUDGET PROCESS. WE ONLY HAD A GROWTH RATE IN THEIR 1% BECAUSE WE WERE COMING OFF, I DON'T KNOW IF YOU REMEMBER IN 2017 WITH THE ROLLING GAS PRICES AND THERE WAS A LOT OF THINGS GOING ON WITH THE ECONOMY NOT DOING GREAT AND SO WE WENT VERY CONSERVATIVE THAT YEAR WITH 1% GROWTH. ACTUAL GROWTH WAS 2%.

2.6 THAT YOU'RE SELLING 2019 WE INCREASED OUR PROJECTION TO 2%. AND THEN WHAT HAPPENED.

THE ACQUISITION OF ANADARKO. ANADARKO IS OUR THIRD-LARGEST SALES TAX PAIR AND SO WE KNEW BASED ON THE REVENUE THAT THEY GENERATED THAT WE WOULD HAVE AN IMPACT.

LOWERED IT BACK TO 1%. THAT 1% IN 2020 IS WHAT WE IS USED IN THE INCORPORATION MODEL AT THAT TIME. THEN WE HAD IN ANTICIPATION REBOUND FROM THE PANDEMIC IS HOW WE BUDGETED FOR 2021 SO WE NEED 2020 WAS TERRIBLE AND WE FIGURED WE WOULD HAVE A COMEBACK IN 2021 WHICH WILL SHOW YOU IN A MINUTE. WHAT DO WE DO FOR 2022? WE ARE LOOKING AT OUR CURRENT TRENDS AND PARTICULARLY OUR INTERNET SALES AND THAT'S HOW

WE CAME UP WITH 2.75% ASSUMPTION FOR SALES TAX. >> LET ME JUST BE FOR A SECOND. THE CHANGES IN THE LAW FOR INTERNET SALES TAXES DID NOT OCCUR BEFORE WE DID THE INITIAL REJECTIONS I JUST WANT TO MAKE A CLARIFICATION.

>> THANK YOU VERY MUCH. NOT ONLY WAS THE SUPREME COURT DECISION AFTER THAT BUT THEN IT TOOK THE STATE COMPTROLLER'S OFFICE ALMOST A YEAR AND HALF TO MAKE THE RULES SO WE REALLY DID NOT START RECEIVING SALES TAX FROM INTERNET SALES UNTIL THE FOURTH QUARTER OF 2019.

HERE IS A LOOK BACK AT OUR SALES AND USE TAX GROWTH OVER A PERIOD OF TIME.

YOU CAN SEE WHEN WE START OFF THE CHART BACK IN 2012 THROUGH 2015 WE WERE HAVING MAJOR GROWTH. THE REASON FOR THAT IS IF YOU RECALL THE DEVELOPMENT OF THE WETLANDS DURING THAT TIME WE HAD THE TOWN CENTER WAS BOOMING AND THE DEVELOPMENT OF HOWARD HUGHES WAS GOING ON. THE VILLAGE OF CREEKSIDE PARK. THERE WAS JUST LOTS OF ACTIVITY AND IT WAS THROWING OFF A LOT OF SALES TAX. MORE RECENTLY WHEN WE LOOK BACK AT 2017 TO 2019. WE AVERAGE THOSE YEARS AT ABOUT 3.8%.

THE 2017 IS A LITTLE HIGHER THAN NORMAL BECAUSE AS YOU CAN SEE IN 2016 THAT WAS THE YEAR WE WERE TALKING ABOUT EARLIER WHERE THERE WAS AN ECONOMIC DECLINE AND AFTER YOUR LIKE THAT WE BOUNCE BACK PRETTY GOOD. 2020 WITH COVID 19 WE HAVE A 1% DROP IN SALES TAX REVENUE AND IN 2021 WE'RE BOUNCING BACK VERY NICELY PROTECTING THE 15.6%. HERE IS THE CURRENT SALES TAX REPORT.

AS YOU CAN SEE WE ARE 14.7% OVER WHERE WE WERE LAST YEAR AT THIS TIME AND WE ARE RUNNING 5.7% OR $2.2 MILLION AHEAD OF BUDGET. AND THIS YEAR WE ARE FORECASTING 18.2% INCREASE. THE OTHER THING THAT WE DO WHEN WE DEVELOP ASSUMPTIONS AND

[01:10:07]

FINANCIAL FORECAST IS LOOK AT THE TAX REVENUES BUT BUSINESS SECTOR.

A LOT OF PEOPLE IN THE SALES TAX THEY JUST THINK OF THE RETAIL TAX WHICH YOU ARE USED TO PAYING AT THE DEPARTMENT STORES. WE ACTUALLY HAVE ABOUT 22 DIFFERENT CATEGORIES OF SALES TAX. I HAVE NOT LISTED THEM ALL HERE. IT'S DOWN TO 1% CATEGORY GREATER OF OUR SALES TAX REVENUES. YOU CAN SEE THE TOP THAT RETAIL TRAILER TRADE BY FAR IS OUR GREATEST CONTRIBUTOR OF SALES TAX AND WE ARE CURRENTLY TRENDING ABOUT 29.6% WHEN COMPARED TO THE PREVIOUS YEAR. FOOD SERVICES WAS STILL TRENDING NEGATIVE DURING THE FIRST FOUR MONTHS OF THIS YEAR BUT HAS REALLY PICKED UP RECENTLY SO THAT'S GREAT.

WE LIKE TO SEE. THE INFORMATION IN MANUFACTURING IS STILL DOWN WHEN COMPARED TO LAST YEAR BUT IT'S TRENDING UP IF YOU LOOK AT THE PAST WE ARE DOING GOOD AND I CAN READ THE REST OF THOSE BUT YOU COULD SEE THERE ARE VERY POSITIVE TREND IN OUR SALES TAX CATEGORIES. THIS IS NOVAK CONSULTING HAS BEEN WORKING ON OUR PROCESS.

THE PROBABLE GROWTH PROJECTION FOR PROPERTY TAXES 2% AND FOR SALES TAX OF 3%.

A LOT OF QUESTION ABOUT WHY THE TOWNSHIP DECIDED TO USE THIS AND I'M MEAN ME WHICH IS A 2.75% GROWTH ASSUMPTION IN THIS FIVE-YEAR PLAN INSTEAD OF A 1%. I SAY INSTEAD OF A 1% BECAUSE THAT IS THE CONVERSATION ABOUT HOW THE GROWTH ASSUMPTION THAT THE BOARD CHOSE TO USE IN THE BUDGET IS HIGHER THAN THE 1% THAT WAS PUT INTO THE ORIGINAL CORPORATION MODEL.

THIS IS WHY. IT'S THE THINGS WE TALKED ABOUT.

WE HAVE HISTORICAL TRENDS SHOWING 3.8% AND WE HAVE A TEXAS COMPTROLLER WIDGET AND MENTIONED BUT THAT'S THE OTHER GROUPS THAT WE LOOK TO AND THEY DO A VERY DETAILED BY REGION IN TEXAS LOOK AT ECONOMIC GROWTH AND WHAT THEIR PROJECTIONS FOR SALES TAX ARE SO WE ALWAYS LOOK AT THAT REPORT. OUR PURE CDS ARE USING THREE POINTS AND THEIR FIVE-YEAR PLAN. THAT IS WHY I RECOMMENDED IN THE BOARD CHOSE THE 2.75% GROWTH FACTOR. ONE OF THE COMMENTS THAT I WANT TO CLARIFY THAT WE HAVE HEARD A LOT IS THAT THE INCORPORATION MODEL IS ALMOST TRIPLING SALES TAX REVENUE PROJECTIONS.

THAT IS NOT THE CASE. BASED ON THE ASSUMPTIONS THAT WE JUST TALKED ABOUT WHAT IS HAPPENING WITH OUR SALES TAX GROWTH IS WE ARE ABOUT $1.6 MILLION PER YEAR ANNUAL.

>> JUST A POWERPOINT ON THAT. F IT WAS REALLY TRIPLE THEY WOULD BE LOOKING AT 60 MILLION IN SALES TAX IN 2023. PEOPLE ARE SAYING WE'D BE GETTING HUNDRED AND 80 MILLION.

NO NEVER SAID THAT. YOU'RE SAYING IT'S ONLY ABOUT 1,000,000,700,000.6 INCREASE

EVERY YEAR. >> WITH PUBLIC CRITICISM OUT THERE WITH SPEECHES REGARDING INCORPORATION WE MANIPULATED OUR GROWTH IN ORDER TO ACHIEVE AN OUTCOME.

THAT'S JUST NOT FACTUAL. THE FACT IS WE SHOWED YOU THE TRENDLINES AND WHAT THEY ARE AND OUR CURRENT TRENDLINE IS HIGHER THAN THE ADOPTED CHANGE FIVE-YEAR PLAN.

THE LANGUAGE THEY ARE USING BECAUSE LANGUAGE IS NOT OURS AND GIVES PEOPLE AND THEY DOUBLE THE ASSUMPTIONS HERE AND THEY TRIPLE THE ASSUMPTIONS THERE.

THEY'RE GIVING NO CONTEXT OF THE PUBLIC. THEY ARE INTENTIONALLY MISLEADING PEOPLE TRYING TO SCARE THEM INTO SOME NEFARIOUS ACTIVITY OCCURRING AND THAT'S

JUST NOT THE CASE. >> IF I MADE CHAIRMAN. HAS ANYBODY FROM THOSE ENTITIES THAT ARE HAVING THOSE CONVERSATIONS IN THE COMMUNITY APPROACH TO YOUR TALK TO YOU

PERSONALLY TO TRY AND UNDERSTAND THIS BETTER? >> NO MA'AM.

>> OKAY BESIDES THE SALES TAX GROWTH ONE OF OUR OTHER LARGE SOURCES OF REVENUE AS PROPERTY

[01:15:07]

TAX. WHY DID THE TOWNSHIP USE OF PROPERTY REVALUATION RATE OF 2% AGAIN INSTEAD OF 1%? 1% IS WHAT WE HAD USED PRIOR INCORPORATION STUDY BECAUSE AT THAT TIME WE WERE TRENDING AT 1%. TO BE CONSERVATIVE THAT IS WHAT WE USED. NOW THAT HAS CHANGED. WE LOOKED AT SEVERAL DIFFERENT THINGS AGAIN THE NOVAK PROJECTION WAS 2%. WE HAVE BEEN TRENDING UPWARD OVER THE PAST SEVERAL YEARS. I THINK WE KNOW WHAT REAL ESTATE IS DOING RIGHT NOW AND HAS BEEN DOING. THOSE TRANSACTIONS THAT HAVE BEEN HAPPENING THIS YEAR WILL GET FACTORED AND INTO THE JANUARY 1, 2022 PROPERTY TAX RULES AND THAT IS WHAT WE WILL

USE FOR PROJECTIONS IN THE FOLLOWING YEAR. >> WITH THAT MPTION ONE OF THE PROJECTED PROPERTY TAX REVENUES FOR THE TOWNSHIP IS $1.2 MILLION PER YEAR AND IT'S NOT DUE TO EVALUATION WE HAVE NEW PROPERTIES THAT ADDED TO THE GOAL EACH YEAR AND WE HAVE EXPIRING TAX ABATEMENTS WITH THREE OF THOSE I BELIEVE IN THE NEXT COUPLE OF YEARS AND SO THOSE ABATEMENTS WILL EXPIRE AND GENERATE ADDITIONAL TAX REVENUE AND THE COURSE OF 2%

REVALUATION. >> I WANTED TO TALK ABOUT THE ASSUMPTIONS WE USE IN ORDER TO DEVELOP THE FIVE-YEAR PLAN AND THE BASE BUDGET. WHAT ARE YOU TALKING ABOUT INCORPORATION REVENUES OR EXPENSES AT THIS POINT. THIS IS OUR ONGOING TOWNSHIP EXPENSES THAT WE PUT THAT TOGETHER INTO THE MODEL AND PROJECTED THAT OUT WHAT WE FOUND IS THAT WE COULD MAINTAIN THE CURRENT TAX RATE OF 22.31 AND HAVE THAT IS THE MAXIMUM INITIAL TAX RATE IN 2022 SHOULD THE VOTERS CHOOSE TO VOTE FOR INCORPORATION AS WE JUST TALKED ABOUT ON THE BALLOT. THE RATE IS 22.31 CENTS. AGAIN I NOTICED IN CONVERSATIONS ABOUT THAT NOT BEING THE REAL NUMBER. THE REAL NUMBERS THE OLD MODEL

[01:20:01]

OF 28 OR WHATEVER IT WAS AND IT'S NOT. IT'S 22 $.31 AND THAT IS THE LANGUAGE ON THE BALLOT AND THAT IS WHAT THE BOARD HAS APPROVED. THAT RATE IS CARRIED OUT FOR FIVE YEARS SO THE INCORPORATION TAX RATE THAT IS PROJECTED FOR 2025 JUST BASED ON EVERYTHING WE JUST LOOKED AT THE TAX RATE DOES NOT CHANGE. WE HAVE THE FINANCIAL CAPACITY IN TERMS OF THE ASSUMPTIONS AND DEBT SERVICE WITH THE RESERVE ALLOCATIONS WHEN YOU PUT THAT TOGETHER THERE IS A FINANCIAL CAPACITY TO KEEP THAT RATE OF 2231.

THE MAXIMUM INITIAL TAX RATE IS THE RATE IN 2022 SO THAT THE VOTERS PROVE THIS YEAR FOR INCORPORATION THE MAXIMUM RATE CAN BE NEXT NOVEMBER IS ONE REPORTS THAT THE TAX RATE AND IT'S 2231 BY LAW. THERE'S NO GETTING AROUND IT. IT COULD BE LOWER BUT IT CANNOT BE HIGHER THAN 2231. THEREAFTER THE FIRST YEAR YOU ARE SUBJECT TO THE NEW CITY WITH LOCAL JURISDICTIONS IN TEXAS SUBJECT TO WHAT IS CALLED A PROPERTY TAX.

EFFECTIVE JANUARY 1, 2020 THERE WERE CHANGES TO THE PROPERTY TAX LAW THAT LIMITED GROWTH IN REVENUES GENERATED BY EXISTING PROPERTIES TO 3.5% PER YEAR AND PREVIOUS THAT IT WAS A PERCENT.

ANY RATE INCREASE ABOVE 3 AND A HALF% REQUIRES VOTER APPROVAL. THAT IS NOT SOMETHING AND IS NOT A LOOPHOLE AND NOT OR A WAY TO GET AROUND IT. THAT'S ANYTHING ABOUT THREE AND HALF PERCENT INCREASING AND ASSIGNED AN INCREASE IN TOTAL RATE.

IT IS AN INCREASE IN THE MAINTENANCE AND OPERATIONS PEACE.

WHAT DOES THIS MEAN FOR THE OWNER OF AN AVERAGE VALLEY HOME IN THE WOODLANDS? ANY TAX INCREASE GREATER THAN APPROXIMATELY $32 WILL REQUIRE VOTER APPROVAL.

I DON'T WANT ANYBODY TO HOLD THAT TO ME NEXT YEAR. IT CAN BE SOMETHING AROUND THERE BUT IT COULD BE A DOLLAR EITHER WAY. AGAIN I CAN'T PREDICT THAT.

IT'S NOT LIKE I HAVE A NUMBER RIGHT NOW THAT I COULD TELL YOU BECAUSE IT DEPENDS ON APPRAISED VALUES. BASED ON WHAT IT IS THIS YEAR THE MAXIMUM WIDTH AND $32.

HOW DOES THAT PROPERTY TAX WORK? I'M JUST GONNA PUT A DISCLAIMER HERE THAT PLEASE NOTE WHEN YOU SEE THE INCREASES FOR 2025 THESE ARE NOT THE RATES THAT ARE PROJECTED FOR A NEW CITY. THIS IS MERELY AN EXAMPLE OF HOW IT LIMITS GROWTH WITH THE TOPIC PROPERTY TAX RATE. BASED ON CURRENT DATA THE ANNUAL INCREASE WITHOUT VOTER APPROVAL WOULD BE.007. NOT SEVEN CENTS OR 7/10 OF THE SONS IT'S .007 WHICH AGAIN IS A 32 VALUE IT TAKES APPROXIMATELY 10 YEARS TO RAISE THE TAX RATE 6.3 CENTS TO GET TO 2861.

CAN I THINK THERE'S A LOT OF MISUNDERSTANDING ABOUT HOW THE WORKS AND HOW MUCH YOUR TAX RATE CAN INCREASE FOR THAT INITIAL MAXIMUM VOTE THAT IS TAKEN.GAIN IT WOULD TAKE 10

YEARS TO BE ABLE TO MOVE THE NEEDLE SIX CENTS. >> IT'S IMPORTANT TO POINT OUT THAT OUR FINANCIAL MODEL DOES NOT PROJECT AN INCREASE. THIS IS A WORST-CASE SCENARIO WITH CITY COUNCIL GONE WILD COMING TO THE MAXIMUM WITHOUT VOTER APPROVAL EVERY YEAR FOR 10 STRAIGHT YEARS. THERE ARE ACTUAL PEOPLE THAT HOLD THEMSELVES AS NEWSPEOPLE AND PUBLISH THE TAX RATES GO TO 43%. IT'S WITHOUT VOTER APPROVAL THAT THIS IS STATISTICALLY ILLEGAL. THEY ALSO DON'T MONITOR ACTUAL PROJECTIONS WHICH SHOWS THE STATE RELATIVELY FLAT. THAT'S WHY HAVE THE BIG DISCLAIMER OUT THERE. THIS IS MERELY AN EXAMPLE AND NOT WHAT WE ARE PROJECTING.

>> WHAT PERCENTAGE OF OUR ACTUAL BUDGET IS MADE UP OF THE APPROPRIATE TAXES?

>> IT'S ACTUALLY COMING. >> FULL DISCLOSURE DO NOT SEE THE SLIDESHOW.

[01:25:04]

>> BEFORE WE GET TO THAT SIDE IS COMING UP. WE WERE TALKING ABOUT THIS WITH THE PROPERTY TAX BEING THE WORST CASE SCENARIO. IT'S ONE OF THE OPTIONS THAT HAS BEEN INTO THE INCORPORATION MODEL AND IT IS ENACTING A PROPERTY TAX FREEZE FOR A PERSON 65 OR OLDER. I'VE GOT QUESTIONS ABOUT HOW IT WORKS.

>> I THINK YOU NEED TO SAY THAT THAT'S I DEFECTED TO THE FIVE-YEAR FORECAST SHOULD.

>> IT IS PART OF THE INCORPORATION MODEL AND WE HAVE REDUCED THE PROPERTY TAX REVENUES TO ACCOUNT FOR THE RAISE. IT WAS INCLUDED INTO THE MODEL AND SO WE WANTED IT TO BE ACCURATE ABOUT THAT. HOW DOES IT WORK IN THE YEAR THAT YOU QUALIFY? IT'S WHEN YOU TURN 65 YEARS OLD ARE YOU QUALIFY FOR DISABILITY.

YOUR TAX RATE IS FROZEN. THIS IS AN EXAMPLE OF AN AVERAGE VALUE.

IF THE TAX RATE IS 22 AND $.31 TAX LEVY WOULD BE 1024 AND THAT IS THE MOST YOU ARE GOING TO TAKE ON IN YOUR LIFE UNLESS YOU MAKE MAJOR TO YOUR HOME OTHER THAN THAT IT'S NOT.

YOU DO HOWEVER IF YOUR VALUE GOES DOWN OR THE TAX RATE DECREASES YOU TO GET THE BENEFIT OF HAVING YOUR TAX LOWERED. THIS IS ONLY A CEILING IT

DOESN'T MAKE YOUR TAX INCOME LOWER. >> TO LET ME PICK UP ON THIS.

OU MAY HAVE HEARD WE SHOULD NOT BE TELLING YOU THIS. WE SHOULD AIM A PROMISING TAX RAISE TO SENIORS WHO ARE SOMEHOW ADMIRABLE AND INCAPABLE OF PROVIDING THIS BENEFIT TO OUR RESIDENTS. WE CHECKED. THE INTERIM CITY COUNCIL WHICH WOULD BE THIS CURRENT BOARD DOES HAVE THE AUTHORITY. IT IS POSTELECTION.

WHO FELT OUR SENIORS DESERVE THE TAX RATE CERTAINTY FOR AT LEAST OUR LEVEL OF THE PROPERTY TAX. IT DOESN'T REQUIRE WAITING FOR THE CITY COUNCIL TO BE THE.

>> CAN YOU EXPLAIN ALSO HOW THIS FREEZE ON TAXES WOULD DIFFER FROM WHAT SOME ARE SAYING IS A BETTER OPTION WHICH IS A HOMESTEAD EXEMPTION? THEY ARE FOR TALKING POINTS BUT

NOT IN REALITY. >> IT'S ORDERED COVERED THE THIRD BULLET THERE WHICH IS UNLIKE A HOMESTEAD EXEMPTION. A TAX FREEZE IS NOT IMPACTED BY FUTURE INCREASES IN HOME VALUE UNLESS IT MAKES IMPROVEMENTS FOR THE TAX RATE AND CANNOT BE RESCINDED ONCE ENACTED AND THEREFORE PROVIDES THE ULTIMATE CERTAINTY ABOUT YOUR SPEECH OR TAX BILLS.

HOMESTEAD EXEMPTIONS ARE SUBJECT TO FUTURE TAX RATE INCREASES AND FUTURE CHANGES IN

THE VALUE. >> ANOTHER QUESTION THAT I HAVE BEEN GETTING AND THAT I WANTED TO TRY TO BRING SOME CLARITY TO IS HOW CAN THE PROPERTY TAX RATE STAYED THE SAME IF EXPENSES ARE INCREASING DUE TO INCORPORATION? FIRST IS LIKE TO SAY THAT THAT HAS ALWAYS BEEN THE HISTORY HERE AND IT'S NOT UNIQUE TO THE TOWNSHIP.

THERE'S OTHER LOCAL DISTRICTS THAT HAVE THE SAME TYPE OF PATTERN.

EXPENSES NATURALLY GO UP EVERY YEAR BECAUSE OF ECONOMIC CONDITIONS.

HERE'S A LOOK AT THE TOWNSHIP HISTORY. AS YOU CAN SEE INCREASES HAVE BEEN MANAGED BUT THEY HAVE GONE UP. DURING THAT TIME THE TAX RATE HAS DECREASED. WHAT WE ARE CALLING FOR NOW IS FOR THE TAX RETURN MAINTAIN THE SAME LEVEL WHICH IS WHAT WE DO IN OUR FIVE-YEAR PLANS. EVERY FIVE-YEAR PLAN WE PRODUCE TAX RATE THE SAME SO THAT YOU COULD HAVE UP. COMPARISON AND THEN EVERY YEAR DURING THE BUDGET PROCESS THE BOARD MAKES THE DETERMINATION FOR THE FOLLOWING YEAR.

HISTORICALLY THAT'S WHAT WE'VE ALWAYS DONE. IT'S NOT LIKE A NEW CONCEPT.

SECONDLY IN THIS CASE TO DIRECTOR RESOURCE. A QUESTION A LITTLE WHILE AGO.

[01:30:01]

PROPERTY TAX REVENUES WHEN PEOPLE THINK OF TAXES THEY ONLY THINK OF THE PROPERTY TAX REVENUES AS THE SOURCE TO FUND OUR EXPENSES. FOR THE TOWNSHIP IT'S ONLY 30% OF OUR RESOURCES. 64% IS MADE UP OF OTHER REVENUES.

THE PRIMARY ONE AND THAT IS OUR SALES TAX. BETWEEN SALES TAX AND HOTEL TAX AND MAKES UP ALMOST 50% OF OUR BUDGET. WE ARE NOT RELIANT ONLY ON PROPERTY TAXES. WE WOULD HOPE THAT WE HAVE A GREAT ECONOMIC BASE HERE WHICH IS IN SUPPORT AND THAT WE WOULD BE ABLE TO GENERATE THAT SALES TAX FROM THERE.

IN ADDITION TO THE OTHER REVENUES THIS IS A SITE THAT SHUNNED MANY TIMES BEFORE.

THERE ARE MANY COMPONENTS TO A BALLOT BUDGET. NOT ONLY WOULD WE LOOK OUT TO THE FIVE-YEAR PLAN AND LOOK AT OUR FINANCES ARE DO WE JUST LOOK AT REVENUES THAT WE ALSO HAVE SERVICES AND AMENITIES THAT THE BOARD HAS BEEN WORKING.

OUR EXPENSES PER CAPITA HAS BEEN FLAT FOR A LONG PERIOD OF TIME SO THERE'S ACTIVELY MANAGING GROWTH AND EXPENSES. BECAUSE OF THE POLICIES SET IN PLACE BY THE BOARD WITH THE CAREFUL MANAGEMENT OF EXPENSES AND CONSERVATIVE BUDGET PENCILS THAT ARE USED WE HAVE SUFFICIENTLY HAVE MONEY IN OUR RESERVES THAT WE ARE ABLE THIS YEAR IN THE BUDGET PROCESS TO LOWER THE ANNUAL ALLOCATIONS BY $1.5 MILLION. THE BOARD HAS BEEN VERY ACTIVE IN REFINANCING THAT ARE PAYING THAT OFF. THAT HAS LED TO LOWER DEBT SERVICE PAYMENTS OVER TIME AND WE SEE A SEPARATE CHART ON THAT.

I WANT TO TALK ABOUT THE OTHER REVENUES. IN TERMS OF SPECIFICALLY THE INCORPORATION REVENUES. AS WE TALKED ABOUT A LITTLE WHILE AGO THERE IS 6% OF THE NEW REVENUES COMING INTO THE BUDGET THAT HAVE TO DO WITH SOMETHING SPECIFIC TO CORPORATIONS. THESE ARE NOT NEW TAXES. THESE TAXES ARE CURRENTLY BEING PAID BUT THE STATE KEEPS THE REVENUE BECAUSE AS A TOWNSHIP AND A SPECIAL-PURPOSE DISTRICT WE ARE NOT ELIGIBLE TO RECEIVE THOSE REVENUES. IF INCORPORATING THE CITY WILL RECEIVED THE TAX REVENUE AND SAID. THAT TAX REVENUES MADE UP OF A MIXED BEVERAGE GROCERY STATE TAX PAID BY THE PERMIT HOLDERS AND THEN A MIXED BEVERAGE SALES TAX. IN TOTAL WE HAVE ABOUT $1 MILLION OF REVENUE ESTIMATES FOR THAT TAX REVENUE. WE ARE ALSO PROTECTING ABOUT $877,000 IN REVENUES FROM CORPORATE REVENUES AND FEES. THE ONLY TAXPAYERS WHO ARE SUBJECT TO THE CORPORATE FINES

WILL PAY THOUGH SO THIS IS A VERY SPECIFIC AS IS THIS. >> IF I MAY JUST ONE MOMENT THOSE ARE FEES THAT ARE BEING PAID TO EVER GOVERNMENTAL ENTITIES CURRENTLY.

>> WITHOUT A JUST WANTED TO GO OVER THOSE TO TALK ABOUT OUR BASE BUDGET, HOW WE GOT THERE AND HOW THAT'S BEING USED IN TERMS OF OUR INCORPORATION PROJECTIONS AND HOW THAT WAS LOADED INTO THE MODEL. THE NEXT THING I WANT TO TALK ABOUT IS SOME INFORMATION THAT IS IN REGARDS TO OUR BASE BUDGET OR THE INCORPORATION MODEL WHERE IT HAS BEEN PREDICTED THAT WE HAVE UNDERFUNDED OUR EXPENSES OR RESERVES.

IN THE INTEREST OF HAVING ACCURATE INFORMATION FOR THE FLOOR TO UNDERSTAND AS WELL AS THE PEOPLE THAT RELY IN OUR FINANCIAL INFORMATION IN ORDER FOR THEM TO HAVE THAT CONFIDENCE I WANTED TO YIELD TO GO THROUGH THIS. WHAT YOU ARE SEEING HERE IS A PAGE OUT OF A REPORT THAT WAS PREPARED BY REF CONSULTING SERVICES.

THIS FIRM WAS COMMISSIONED BY THE CORPORATION IN ORDER TO TAKE A LOOK AT OUR INCORPORATION MODEL AND TO REPORT THEIR FINDINGS. THE FINDINGS OF THAT REPORT ARE LISTED HERE. WHAT HE FOUND WAS IN TOTAL A $26.8 MILLION UNDERSTATEMENT OF

[01:35:01]

FUNDS NEEDED FOR INCORPORATIONS I'D LIKE TO GO THROUGH EACH ONE OF THESE SEPARATELY STARTING AT THE BOTTOM. 2.5 MILLION UNDERSTATEMENT OF ASPHALT STREET HABILITATION BUDGET WAS 500,000 ANNUAL FOR FIVE YEARS TO THE THREE CAME UP WITH 2.5 MILLION.

THIS IS FROM THE NOVAK CONSULTING GROUP INCORPORATIONS THAT A CONSOLIDATED REPORT.

THIS TALKS ABOUT THE ACTION THAT THE BOARD TOOK. I DON'T HAVE THE MINUTES I CAN GET THEM. WITH THE BOARD INCLUDED IN THE INCORPORATION STUDY IS $1.25 MILLION IN ANNUAL AND FOR STRUCTURE COST RELATING TO PAYMENT MANAGEMENT INCLUDING ASPHALT AND CONCRETE. BASED ON THE HR GREEN STUDIES WHICH IS AN ENGINEERING FIRM THAT WAS CONTRACTED TO LOOK AT OUR PAYMENT MANAGEMENT THIS AMOUNT, THE 1,000,250 ANNUALLY IS SUFFICIENT TO MAINTAIN ROADWAYS IN THE WOODLANDS AT EXCELLENT CONDITION.

WHAT THE GRID REPORT RECOMMENDED IS 1.25 MILLION FOR FIVE YEARS AND THEN IT STOPS BECAUSE THAT WOULD BE ABLE TO GET THE ROADS IN EXCELLENT CONDITION.

WHAT THE BOARD DECIDED TO INCLUDE IN THE INCORPORATION MODEL WAS TO CONTINUE THAT $1.25 MILLION INTO THE FUTURE. THERE WOULD BE A FUNDING SOURCE OF MONEY NOT JUST THIS ONE TIME TO GET THE ROADS TO THAT CONDITION BUT FOR ONGOING MAINTENANCE SO THAT IS WHAT'S

INCLUDED IN OUR BUDGET. >> ACTUALLY GAVE US THROUGH DIFFERENT NUMBERS.

THE 1.25 MILLION AND IS ACTUALLY THE HIGHEST OF THE THREE NUMBERS THAT THEY

NUMBERS ARE ACTUALLY HIGHER. >> IN THE INCORPORATION MODEL ON THE WEBSITE YOU CAN SEE THE FULL BUDGET FOR YOU ARE RIGHT I WAS JUST ADDRESSING THIS ONE PIECE OF IT.

THAT'S WHY I HAVE THE X FAIR BECAUSE THAT IS ACTUALLY INCORRECT.

THE NEXT ONE I WANT TO TALK ABOUT IS THE $10.7 MILLION OVERDRAFT OF THE INCORPORATION RESERVES THAT THE CONSULTANT CLAIMED. HERE IS OUR INCORPORATION RESERVES. THE BALANCE AT THE BEGINNING OF 2022 WAS $20.8 MILLION.

WE WERE ADDING REVENUES WHICH SHE COULD SEE OUTLINE THEIR IN THE ORANGE AND THE CONSULTANT DID NOT INCLUDE ANY OF THAT $12.2 MILLION OF FUNDING SOURCES IN HIS ANALYSIS.

THAT IS WHY DONE AT THE VERY BOTTOM YOU CAN SEE WHERE HIS REPORT SAYS WE ARE $10.7 MILLION OVERDRAFTED IN OUR INCORPORATION RESERVES. IN REALITY EVEN AFTER SETTING ASIDE POTENTIALLY $16 MILLION TO PROVIDE FUNDING ASSISTANCE FOR A POSSIBLE MUNICIPAL POLICE STATION UNDER INCORPORATION WE WOULD STILL HAVE $1.5 MILLION. AGAIN WE ARE NOT OVERDRAFTED IN

OUR INCORPORATION RESERVES. >> TO THEIR $12.2 MILLION WRONG.

>> YES SIR IN TERMS OF THE MATH. >> THE NEXT ONE I WANT TO TALK ABOUT ARE THE UNDERSTATEMENT OF EXPENSES FOR LAW ENFORCEMENT OPERATIONS AND LAW ENFORCEMENT CAPITAL. PER THE CONSULTANT REPORT THE REASON HE FEELS LIKE THOSE ARE UNDERSTATED IS YOU CAN SEE IN SENTENCE A. THIS IS INCONSISTENT WITH THE DEFINITE EXPECTATION THAT THE NEW CITY WILL HAVE A FULL SERVICE POLICE FORCE.

THE FULL-SERVICE IS THE DIFFERENCE WITH THE HYPER TRANSITION MODELS THAT THE BOARD VOTED ON AND IT'S $4.7 MILLION. THE CONCERT AND THEN GOES ON TO STATE THAT EVIDENCE OF THIS EXPECTATION OF A FULL-SERVICE MODEL IS BASED ON THE FOLLOWING. THERE IS A STATEMENT WRITTEN BY STAFF IN THE AUGUST 2021 MAGAZINE. THE STATEMENT WAS MADE BY IMPORT MEMBER AND THE HYBRID MODEL IS ONLY AN OPTION. THEN HIS CONCLUSION IS WRITTEN DOWN THERE.

THIS LEAVES NO DOUBT THAT THE FULL-SERVICE MODEL SHOULD BE USED IN THE FINANCIAL MODELS FOR INCORPORATION AND BECAUSE OF THIS INCONSISTENCY THERE IS A SIGNIFICANT UNDERSTATEMENT OF LAW-ENFORCEMENT EXPENSES IN THE LAW MODEL. I RECALL GOING BACK TO THE

[01:40:06]

MINUTES BUT THE BEST SOURCE TO DETERMINE THE INTENT OF THE BOARD OF DIRECTORS IS NOT A STATEMENT AND A COMMUNITY MAGAZINE. IT IS THE MINUTES OF THE MEETING. IT IS CLEAR IN THE MEETING THAT THE BOARD CHOSE TO INCLUDE THE TRANSITION MODEL INTO THE INCORPORATION MODEL. THOSE NUMBERS THAT YOU SEE THEIR DOWN BELOW ARE WHAT IS INCLUDED IN THE INCORPORATION MODEL FOR LAW ENFORCEMENT COST.

IN THAT REGARD WE ALSO FEEL THAT THESE ARE THE ONES THAT ARE FACTUALLY INCORRECT IN TERMS OF WHAT THE BOARD DECIDED TO WHAT IS ACTUALLY INCLUDED IN THE INCORPORATION MODEL.

I'M NOT GOING TO ADDRESS THE PUBLIC WORKS AND THE FRANCHISE FEES.

IF YOU READ THE REPORT IT'S BASED ON A COMPLETELY DIFFERENT SET OF ASSUMPTIONS THAN WHAT

OUR CONSULTANTS ARE AND WHAT THEY RECOMMENDED. >> TO YOUR KNOWLEDGE THAT THIS CONTACT YOU OR GREEN TO DISCUSS THE PUBLIC WORK ASSUMPTIONS THAT WERE ENTERED? X NOT TO MY KNOWLEDGE NO SIR. I JUST WANT TO REMIND THE BOARD AND THE PUBLIC WHAT IS INCLUDED FOR PUBLIC WORKS IN OUR INCORPORATION MODEL. RIGHT NOW IN THE BASE BUDGET WE HAVE ABOUT 5.5 GROWING OUT, $6 MILLION IN THE FIVE-YEAR PLAN. WHAT YOU SEE THERE IN GREEN ARE THE WITH ADDITIONAL EXPENSES THAT HAVE BEEN ADDED SPECIFICALLY RELATED TO

INCORPORATION. >> I'M GONNA STOP ON THIS SLIDE.

I WAS READING MY NEWSPAPER THAT IT'S NICE TO GET MAIL TO ME BUT IT DOES PROVIDE A GOOD VISUAL.

IN THIS SEEM TO BE IN YOUR MAILBOX IF YOU HAVE NOT ALREADY READ IT IT IS ARTICULATING THAT OUR PROPOSED PUBLIC WORKS BUDGET IS 6.3 MILLION. PWHAT IS THE ACTUAL?

>> 12.2 MILLION. >> WHEN THEY SHOW CONGRUOUS AT 11.7.HERE'S AN EFFORT TO SHOW A VAST DISPARITY IN PLANNING AND FUNDING TOWARDS PUBLIC WORKS AND THE ACTUAL

PERPETRATOR IS HIGHER. >> I ALSO WANT TO POINT OUT THE CITY OF CONROE IS

SIGNIFICANTLY LARGER IN TERMS OF LANDMASS. >> IS ACTUALLY 72.8 MI.B2 RIGH

AROUND 47.8. >> DOUBLE THE SIZE AND SO WE ARE ACTUALLY BUDGETING MORE FOR THE PUBLIC WORKS BUDGET THAN THE CITY IS. IT DOESN'T MAKE ANY SENSE.

>> IT MAKES SENSE TO US. >> WE HAVE CONCRETE STREET AND A LOT OF IT GOES TO THE COUNTY.

>> IS LESS EXPENSIVE TO PUT IN AND MAINTAIN. >> WHICH MEANS THE REPAIR AND

REPLACEMENT BUDGET IS SIGNIFICANTLY LESS. >> WE ALSO DO MORE ADVANCE

STREETSCAPE MAINTENANCE. >> WE BUDGETED TO CONTINUE TO DO THAT.

>> THAT WAS THE AREA OF CONSULTANTS REPORT. NOW I WANT TO TALK ABOUT THE LAW ENFORCEMENT CRITIQUE. THAT'S THE WORD THAT THEY USE. THE SUPPORT WAS ALSO ISSUED BY THE CORPORATION. THERE ARE THREE DIFFERENT PIECES TO THIS BUT I WANT TO TALK ABOUT. ONE OF THEM CIRCLED THERE IN GREEN WORTH TALKING ABOUT THE INCORPORATION MODEL THAT DOES NOT INCLUDE BASICALLY FOR THE COST FOR MOST OF THE COST WITH THE VEHICLE REPLACEMENTS WERE TO GO OVER THAT. IT TALKS ABOUT THE NUMBERS YOU SEE CIRCLED IN RED WITH $11.1 MILLION THAT THOSE ARE INCLUDED WE KEPT THE NUMBERS FLAT WHICH

[01:45:06]

IS WHAT YOU COULD SEE THEIR SHOWING IN RED BECAUSE WE DO NOT HAVE A 2% CPI GROWTH FACTOR BUILT INTO THE BUDGET. BASED ON THE THEIR CONCLUSION THAT THEY REACH IS THAT WE HAVEN'T INCORPORATION MODEL UNDERFUNDED BY $7.2 MILLION. FIRST I WANT TO THEY HAVE NOT

LOOKED AT OUR UPDATED MODELS OR FINANCIAL ANALYSIS SINCE 2020. >> THAT'S AN IMPORTANT DATE BECAUSE WE DO OUR BUDGET IN AUGUST OF 2020 AND WE JUST FINISHED HOURS IN AUGUST 2021.

EVERYTHING THEY ARE USING IS TWO YEARS OLD. IT'S THREE BUDGETS AGO.

>> IT'S IN THE MIDDLE OF A PANDEMIC WHICH IS PROBABLY ONE OF THE WORST EVENTS WE'VE SEEN

WORLDWIDE IN OUR NIGHT LIFETIME. >> IS A PAGE FROM THE TOWNSHIP ADOPTED 2022 BUDGET. WHAT WE ACTUALLY DID AS WE GREW BY 9.2%.

PART OF THAT WAS THE 5% BECAUSE THEY DID HAVE A 5% ACROSS-THE-BOARD SALARY INCREASE. THE OTHER THING THAT WE HAD TO FUND WAS AN INCREASE IN THE HEALTH INSURANCE. YOU MAY READ SOME OF THE REPORTS OF THEIR HEALTH INSURANCE FOR MONTGOMERY COUNTY WAS UNDERFUNDED. THERE'S AN ADJUSTMENT TO GET THAT BACK UP TO STANDARD BECAUSE WE PAY SALARIES AND BENEFITS FOR THOSE CONTRACTED DEPUTIES. INCREASES ENDED UP BEING 9.2%. ALSO RECALL FROM THE FIRST PAGE THAT ONE OF THE CRITICISMS OF THE CORPORATION MODEL IS THAT WE DID NOT HAVE A 2% ANNUAL CPI FACTOR. IN FACT WE HAVE A 2.25% ANNUAL CPI GROWTH FACTOR IN OUR FIVE-YEAR PLAN SO THIS IS HOW OUR LAW-ENFORCEMENT BUDGET IS GROWING.

THERE'S A TOTAL OF FOUR YEARS OF 56 MILLION ACCORDING TO YOUR PERSONAL REPORT.

OBVIOUSLY WE HAVE COVERED THAT AND HAVE EXCESS OF $4.2 MILLION.

>> WHEN I SAY WE GROSSLY UNDERFUNDED INACCURATE AND UNTRUSTWORTHY.

WE ACTUALLY FUND $4 MILLION MORE. THE EXPERTS ARE TELLING US

THAT'S WHAT WE NEED FOR THIS PARTICULAR ITEM. >> YOU TRUST WHO YOU WANT TO

TRUST. >> THERE WAS THREE DIFFERENT COMPONENTS TO LAW ENFORCEMENT REPORT AND HAS THE SECOND ONE. IN ADDITION TO THE DEPUTIES WE WILL BE FUNDING 19 ADDITIONAL ONES WHICH ARE FOR TWO AS THE DIRECT LAW-ENFORCEMENT POSITIONS.

THE CITY WILL FUND 100% OF THE COST OF THOSE POSITIONS BEGINNING WITH THE COUNTY

[01:50:02]

FISCAL YEAR FOLLOWING INCORPORATION SO THOSE RED LINES THAT YOU SEE THROUGH THEIR EVEN IF THE REST OF IT WAS TRUE THOSE NUMBERS WHERE THEY SAY THEIR SHORT WALL IS $4.8 MILLION THAT WOULD BE OFF BY A $2.3 MILLION BUT IT'S A MUTE POINT BECAUSE THOSE POSITIONS ARE FULLY FUNDED IN OUR INCORPORATION MODELS. 100% OF THOSE COSTS OR POSITIONS WITHIN A MODEL SO THERE IS NO FUNDING SHORTFALL RELATED TO THIS POSITION.

>> JUST DECIDED ANOTHER WAY NOT ONLY IS THERE NO SHORTFALL THERE IS NO DIMINISHMENT IN COMMUNITY SERVICE TO THE RESIDENCE. THEY WILL NOT NOTICE ANY CHANGES IN THE LAW ENFORCEMENT SERVICES WHEN THEY CALL FOR HELP.

IT WILL BE THERE. THAT'S WHY THESE EXPENSES ARE FULLY LOADED AND HERE.

>> THE THIRD PIECE OF THIS AS YOU RECALL LAW-ENFORCEMENT REPORTS SAY THAT FUNDING FROM LAW-ENFORCEMENT VEHICLES WERE NOT INCLUDED IN THE UPDATED INCORPORATION MODEL UP THERE AT THE TOP YOU CAN SEE THAT THEY SAID THAT THE INCORPORATION MODEL WAS SIX MILLION DOLLARS SHORT. FUNDING FOR LAW-ENFORCEMENT VEHICLES IS IN FACT INCLUDED IN THE UPDATED CORPORATION MODEL AND INCLUDES 15 VEHICLES FUNDED OUT OF THE OPERATING BUDGET AND 27 FUNDED IN THE INCORPORATION RESERVE. THE REMAINING VEHICLES ARE INCLUDED IN THE CAPITAL FUND. THERE SORT OF RECONCILIATION OF THAT.

OVER THE FOUR YEARS WE ARE PURCHASING HUNDRED AND 35 VEHICLES AND THAT'S IN THE INCORPORATION MODEL. THERE IS A COST PER VEHICLE THAT'S ONE THING THAT'S DIFFERENT IN OUR REPORT. THE REPORT SUGGESTED A $75,000 COST PER VEHICLE.

WHAT WE USE IS THE ONE THAT WAS GIVEN TO US TWO MONTHS AGO BY THE MONTGOMERY COUNTY SHERIFF'S

OFFICE. >> THAT'S IMPORTANT. WE JUST WANTED 15 VEHICLES AT THIS COST WHEN YOU LOOK AT THAT AGAIN HERE'S HOW IT SCHEDULED OUT IN OUR INCORPORATION MODEL TO FUND A TOTAL OF $9.8 MILLION. AGAIN THE REPORT SAYS WE'RE $6.1 MILLION SHORT JUST TO MAKE IT CLEAR WHERE FULLY FUNDED ON LAW-ENFORCEMENT VEHICLES.

I'M CAN MOVE ON FROM LAW-ENFORCEMENT REPORT. >> BEFORE WE GO TO FAR BACK TO DIRECTOR MILLER'S QUESTION. DID ANYONE FROM THIS COMMISSION STUDY CONTACT YOU OR ANYONE ON

STAFF OR ANYONE IN THE CONSULTING GROUP? >> NOT ME AND NOT TO MY

KNOWLEDGE ANYBODY ELSE. >> TO BE CLEAR KNOW WHEN USES THAT EITHER.

>> HAS HE EVER CAUGHT THE DUSTY QUESTIONS ABOUT STUDY? >> NO SIR.

>> THERE ARE TWO RETIRED LAW ENFORCEMENT OFFICERS FROM THE CITY OF HOUSTON WHO HAVE PROCLAIMED PUBLICLY HOW INACCURATE YOUR WORK AS IN THE STUDY.

TO LOCAL LAW ENFORCEMENT OFFICERS ALSO, AND ENDORSED THE COMMISSIONER IN THESE TWO INDIVIDUALS RESPECTIVELY IN THE STUDY. HAVE A HAVE THEY EVER CALLED TO TALK TO YOU ABOUT THE CITY OR ASK FOR INFORMATION FROM THE TOWNSHIP THAT SUPPORTS THE

MODEL?> NO SIR. >> I WILL EVEN EXPAND THAT QUESTION.

DID ANY BOARD MEMBER CALLED AND ASKED FOR CLARIFICATION ON ANY OF THE THINGS PRIOR TO THEM PUBLISHING A SCATHING REVIEW AND PRINTING THEIR OWN NEWSPAPER.

>> I'M SURE WE HAVE UNTIL THAT WE DON'T UNDERSTAND. >> JUST TO REITERATE EVERYTHING YOU JUST SAW IS BASED ON THE ACTUAL CURRENT FUNDING AND CASH ON HAND.

NOT SPECULATION OF ANYTHING. THE ACTUAL CURRENT COSTS. >> IN MANY CASES IT'S ACTUALLY MORE CONSERVATIVE THAN RECOMMENDATIONS THAT ARE MADE BY THE CONSULTANTS FOR US TO

[01:55:02]

CONSIDER. >> THAT IS TRUE BECAUSE WE TOLD YOU ABOUT IT IN THE BEGINNING. WE LEAN ON THE CONSERVATIVE SIDE.

>> YOU WOULD HAVE TO ASSUME THAT IF WE HAVE EXCEEDED THEIR PROJECTIONS OF WHAT WE NEED AND OBVIOUSLY INCORPORATION IS VERY MUCH DOABLE WITH THE TAX RATE THEN WE PROPOSED YOU MIGHT WANT

TO SAY AUDIBLY. >> YOU ARE SMILING IS THAT HE HAS?

>> I CAN'T ARGUE WITH THAT PLOGIC OF COURSE. WE HAVE MORE FUNDING THERE THAN

THEY ARE RECOMMENDING. >> AND WENT OUT TO LAW-ENFORCEMENT COMPONENT.

I THINK IT SUPPORT AND TO POINT OUT THAT WE'VE ACTUALLY REACHED OUT TO THE GALVESTON COUNCIL THIS WEEK. WE SPOKE DIRECTLY WITH THE DOCTOR THAT CONFIRMED THAT IF INCORPORATION WERE TO PASS IT WOULD AUTOMATICALLY BE ELIGIBLE FOR THREE DIFFERENT PUBLIC SAFETY PROGRAMS. THERE'S NO FEDERAL STATE OR GRANT PROGRAMS BUILT-IN TO ANY OF THESE MODELS WHICH MOST LIKELY WOULD BE AVAILABLE FOR EITHER GENERAL LAW OR

WHOLESALE. >> NOT GOING TO MOVE ON TO THE NEXT TOPIC.

ONE OF THE QUESTIONS WE'RE GETTING THIS HAS THE GROWTH IN VALUES CREATED A WINDFALL IN PROPERTY TAX REVENUE? WE RETREATED HERE WITH THE NUMBERS HERE'S THE PROPERTY TAX VALUE THAT IS INCREASING SINCE 2010 WHICH WAS THE INITIAL YEAR OF THE TOWNSHIP.

THE TAXABLE VALUE IS $21.1 MILLION. >>

[02:10:43]

THE GOAL IS TO ACHIEVE A BALANCED BUDGET. THIS IS SOMETHING THAT WE ARE

[02:10:49]

VERY CLOSELY LOOKING AT AND IT SUPPORTS FINANCIAL SUSTAINABILITY IN YEARS IN THE

[02:11:02]

FUTURE. THAT'S THE KEY TO EVERYTHING ON STUFF THAT WE DO AND IT'S THE KEY TO THE POLICIES THAT THE BOARD MAKES. I'M JUST TAKING DIFFICULT APPROACHES HERE. THE VARIANCES IS IT APPROPRIATE SOURCE FOR FUNDING FUND BALANCE OR RESERVES. THAT'S EXACTLY WHAT DFO RECOMMENDS THAT YOU DO WITH THOSE TYPES OF MONEY. AND IN TERMS OF USING RESERVES TO PAY FOR ONGOING EXPENDITURES OR DO SOMETHING LIKE REDUCE THE TAX RATE WHICH IS AN ONGOING REVENUE SOURCE, IT INDICATES AN IMBALANCE IN THE BUDGET AND GIVES THAT SPECIFIC EXAMPLE OF RESERVES AND USED IT TO FUND

ONGOING TYPES OF OPERATIONS. >> IN FACT THAT'S EXACTLY THE REASON WHY WE DO A FIVE-YEAR FORECAST. IT WOULD BE SUICIDAL NOT TO DO THIS.

>> YOU ALWAYS WANT TO MAKE SURE WHAT YOU ARE DECIDING IN THE CURRENT YEAR IS SUSTAINABLE

. >> AGAIN GOING DOWN TO WHY THIS IS A ONE-TIME FUNDING SOURCE SUCH AS RESERVES THAT CANNOT BE USED TO THE PROPERTY TAX RATE IT'S BEING SUGGESTED AND IF YOU USE IT IN THE FIRST YEAR WITH $20 MILLION RESERVES TO FUND EXPENSES AND LOWER THE TAX RATE TO DO THAT WHEN YOU GET TO THE SECOND YEAR WHAT ARE YOU GOING TO DO? NOW YOU DON'T HAVE THE TAX REVENUE COMING IN. YOU HAVE USED AT THAT RESERVE

AND I HAVE AN IMBALANCE IN YOUR BUDGET. >> TO MAKE A POINT HERE, THE PEOPLE WHO HAVE SUGGESTED THAT WE TAKE THE RESERVES AND SPEND THEM TO REDUCE THE TAX RATE HAVE THROWN OUT DIFFERENT NUMBERS. A LOT OF THEM HAVE RUN BUSINESSES OR THEY ARE RUNNING BUSINESSES AND THEY SURELY KNOW THAT THAT'S NOT HOW YOU RUN A BUSINESS. YOU DON'T PAY FOR YOUR OPERATING EXPENSES WITH SOME

BIG AMOUNT OF MONEY THAT YOU HAVE ONE TIME. >> THEY KEEP EXPENSES DOWN AND HAVE A NICE CUSHION. THAT'S THE CUSHION WITH THE RESERVE.

IT'S A RAINY DAY FUND OR A LOT OF WORDS THAT YOU COULD USE. YOU HAVE TO HAVE SOMETHING LIKE THAT BECAUSE YOU NEVER KNOW WHEN THERE WILL BE NATURAL DISASTERS OR COVID 19 OR FINANCIAL HOOKUPS THAT WILL SOME HELP IN ORDER TO GET US THROUGH.

IT'S A ONE-TIME EVENT. >> IF WE HAD LISTENED TWO YEARS AGO AND SPEND THAT INCORPORATION RESERVED TO PAY DOWN THE TAX RATE LET'S TALK ABOUT WHAT WOULD'VE HAPPENED LAST YEAR. $14 MILLION REVENUE SHORTFALLS. THE ONLY PLACE YOU CAN GO AS YOUR OPERATION RESERVES. THAT OPERATION ROSE AS SHE HER TWO CHOICES.

YOU CAN EITHER PROPOSE A HEFTY THESE WHICH IS UNLIKELY TO PASS OR YOU HAVE TO BEGIN CUTTING SERVICES IN ORDER TO MAKE UP THE SHORTFALL. I'M DENNIS SECOND DOCTOR SHELLEY'S COMMENTS. THESE RESERVES HAVE BEEN OUT IN THE OPEN FOR THE BUDGET PROCESS WHICH IS ABSOLUTELY TRANSPARENT THE ENTIRE EVENT ON THIS BOARD. WHEN YOU HAVE AN EXPENSE THAT YOU EXPECT IN EVERY SINGLE ELECTION CYCLE FOR YEARS HAS BEEN A DISCUSSION CORPORATION

[02:15:04]

ACTIVITY THAT SAME HERE SAYS PRETTY MUCH THE AT SOME POINT WE ARE COMMITTED TO GIVING THE RESIDENTS AN OPPORTUNITY TO VOTE ON THE CORPORATION IT WOULD BE REALLY IMPRUDENT OF US TO STRATEGICALLY PLAN FOR KNOWN EXPENSES. IT'S ABSOLUTELY MIND-BOGGLING TO YOUR PEOPLE SAY THEY JUST HAD THE $20 MILLION AND IT POPPED UP.

THERE HASN'T BEEN ANYTHING HIDDEN. I'M CAN GIVE YOU AN ANECDOTAL THING THAT HAPPENED TO ME A COUPLE YEARS AGO. WAS DOING AN INTERVIEW AND I CAME OUT AND THERE WAS A GENTLEMAN THERE I WAS RUNNING AGAINST AND HE WAS A FORMER FINANCE MANAGER FOR THE CITY OF HOUSTON. HE STOPPED ME AND SAID I JUST WANT TO TELL YOU HOW IMPRESSED I AM ABOUT THE WAY YOU DO YOUR BUDGET.VERYTHING IS RIGHT THERE IN THE OPEN AND IT'S AMAZING. WE HAVE NOTHING TO HIDE. I'M TRY TO HIDE ANYTHING FROM

ANYONE. >> IT'S BEEN CALLED THE CORPORATION RESERVES SINCE 2016. IT'S NEVER BEEN CALLED ANYTHING ELSE.

THAT'S EXACTLY WHAT IT'S BEEN. >> I HAVE ONE QUESTION ABOUT THE RESERVES.

>> I WENT BACK AND WATCH THE VIDEO BECAUSE I THOUGHT IT WAS BEING MISCHARACTERIZED AS THE JEDI MIND TRICK THAT CONVINCED THIS BOARD AND THE STAFF ON HOW TO HOARD CASH AND HIDE CASH FROM THE PUBLIC OVER TAX PEOPLE TO MAKE THEM BLISSFULLY UNAWARE WHEN 90% OF THEM SAY THEY FEEL OUR SERVICES ARE INTEGRATED VALUE WITH THE LAST RESIDENTIAL SURVEY.

THE EXPANSION OF THE RESERVES ACTIVITY STARTED IN 2012. LED BY DIRECTOR BASS.

THEY STARTED CREATING NEW RANDOM ROAD RESERVES. THE RESERVE HERE OR THERE AND THEN THESE ENDED UP HAVING A LOT OF THE MONEY THAT'S IN THE RESERVE ACCUMULATING AND I JUST WANT TO ADDRESS ONE THING. I MAY BE CHAIRMAN OF THE BOARD BUT I GET ONE VOTE.

I DON'T CONTROL ANY OF THESE VOTES. EVERYBODY HERE IS INDEPENDENT AND WE HAVE A PASTOR AND MEDICAL DOCTOR OR ENTREPRENEUR WITH FACILITIES MANAGER WITH A FORTUNE 500 COMPANY AND AN ENTREPRENEUR WHO TEACHES ENTREPRENEURSHIP.

WE ARE NOT INCOMPETENT PEOPLE. BUT WE ARE REALLY SUBJECT TO THE MIND TRICK.

WHEN YOU SEE THINGS ASPIRE I CAN'T TAKE MORE CREDIT FOR ANYTHING.

THIS IS A PROFESSIONAL MANAGED ORGANIZATION. WE HAVE A PROFESSIONAL CITY MANAGER WHO IS OUR GENERAL MANAGER NOW WHO RUNS THIS OPERATION.

WE HAVE A FIRE CHIEF THAT RUNS THE FIRE DEPARTMENT. WE'RE NOT RUNNING ANY OF THE STUFF. WE SET POLICY AND GUIDELINES AND THE STAFF IS LARGELY RESPONSIBLE FOR WHY WE HAVE A CREDIT AND I GO LOOK AT THE CREDIT RATINGS OF THE PEOPLE WHO ARE ACTUALLY JUDGING WITH CORPORATIONS AND COUNTIES TO LOOK AT THEIR BOND RATINGS.

ONE OF THEM ARE A PLUS. I DON'T KNOW WHY I WOULD TAKE ADVICE OR SUGGESTIONS FROM THESE FOLKS WHO COULDN'T TAKE THE TIME TO COME TO THE MEETINGS WE HELD OVER THE LAST THREE YEARS OR WHEN THEY FOUND SOMETHING GROSSLY INACCURATE THAT CANNOT THREATEN THE QUALITY OF LIFE OF OUR COMMUNITY AND THEY COULDN'T PICK UP THE PHONE TO CALL US AND SAY BEFORE YOU DO THIS LET US MAKE SURE YOU KNOW THESE HOLES IN YOUR BUDGETS DON'T DO THIS BECAUSE IT'S RECKLESS. NOT A SINGLE CALL. WE GOT RESOLUTIONS FROM THE CHAMBER BUT NO CONTEXT OF SAYING THEY HAD THESE COMMISSIONS SAYING THEY ARE GROSSLY INACCURATE. WE WOULD RATHER RATE. THE INFORMATION IS ACCURATE ACCURATELY INACCURATE. THEY ARE DISPARAGING OUR STAFFS WORK.

AND IT'S WRONG. SHE'S BEEN HERE 29 YEARS. WHEN THEY THOUGHT AND SAY.

[02:20:03]

[APPLAUSE] WE ARE NUMBER ONE BUT THEY WANT TO TAKE THE CREDIT FOR BEING NUMBER ONE.

UNDERSTAND THAT WE HAVE A GREAT COMMUNITY AND WAS MASTER-PLANNED BY GEORGE MITCHELL AND IT'S NOT EXACTLY THE SAME BUT HE'S BEEN DOING AS HE DID AT THE FIRST 20+ YEARS AND THE LAST 20+ YEARS. WE A LOT TO THAT GROWTH OVER THAT PERIOD OF TIME.

AS THINGS GET DEVELOPED THEY GET HANDED OFF TO THE TOWNSHIP. THE OLD HLA'S AND IT'S THE TOWNSHIP THAT DOES THE REPAIRS AND REPLACEMENTS. IT'S THE TOWNSHIP STEP BOUGHT THE REC CENTER AND CREATED A PARK. IF YOU LISTEN TO THEM YOU THINK HE ROSE THE ENTIRE WOODLANDS. HE DOES NOTHING IN CREEKSIDE PARK AND HE DOES NOTHING IN PRECINCT 2. THERE'S NOTHING IN PRECINCT 4. IT'S INTERESTING TO HEAR THE DIALOGUE THAT'S OUT THERE. THE PEOPLE THAT LIVE HERE AND LARGELY OUR SCHOOL DISTRICTS ARE WHAT GOT IT SO THAT READING. YES IT'S BEAUTIFULLY PLANNED AND WE LIVE, WORK AND PRAY HERE BUT DON'T DISPARAGE OUR CONGRESSIONAL STAFF.

THIS IS THE WORK PRODUCT IN THE WORK DIRECTLY WITH THE CONSULTANTS.

IF ANYONE SHOULD APOLOGIZE IT SHOULD BE DONE. [APPLAUSE]

>> ONE THING I WOULD SAY IS AT FIRST I FEEL INSULTED BUT WHEN I THINK ABOUT IT MORE I FEEL INSULTED ON BEHALF OF YOU, JOHN, KAREN AND CHRIS AND THE OTHER 497 EMPLOYEES THAT WORK THEIR TAILS OFF EVERY DAY TO HELP MAKE SURE THAT THIS COMMUNITY IS WHAT IT IS AND IS WHAT THE RESIDENTS DESERVE. I APOLOGIZE TO YOU ON BEHALF OF THESE PEOPLE WHO REALLY HAVE NO CLUE WHAT THEY ARE TALKING ABOUT AND I'M SORRY THAT YOU HAD TO GO THROUGH THIS.

>> LET'S BE HONEST DIRECTOR MLLER. THEY ARE CALLED HIRED GUNS AND THEY ARE JUST TRAINED AND EVERYBODY IN THE WITHIN'S HAS A DIFFERENCE OF OPINION.

SOME PEOPLE WILL CALL AND CANCEL CULTURAL PEOPLE. IT'S A SHAME THAT IT HAS TO COME TO THAT BUT I THINK EVERYBODY KNOWS THE WORK QUALITY THAT YOU HAVE AND IT'S

A PLUS PLUS. >> ONE OF THE THINGS THAT REALLY CONFUSES ME AS A PEOPLE THAT ARE IMPUGNING THE CHARACTER OF YOU AND YOUR DEPARTMENT IN TOWNSHIP ARE THE SAME PEOPLE WHO PRAISE YOU AND JOHN AND THE TOWNSHIP STAFF IN PREVIOUS YEARS EITHER WHEN THEY HELD LEADERSHIP POSITIONS IN THIS COMMUNITY OR WORK BUSINESS LEADERS IN THIS COMMUNITY.

NOW BECAUSE IS A DISAGREEMENT ON THE APPROACH TO GOVERN THE COMMUNITY THEY NOT DECIDE THAT EVERYTHING THEY SAID IN THE PAST IS NOT REALLY ACCURATE. NOW WHAT THEY'RE SAYING TODAY IS THE MOST ACCURATE. FOR ME THAT'S AS MUCH IS INSULTING TO YOU IN TOWNSHIP

STAFF THAN ANYTHING ELSE. >> I THINK I'M DOWN TO JUST A COUPLE OF SITES.

THIS IS THE LAST ONE ON THING THAT I'VE BEEN QUESTION ABOUT AND THEN WE GET TO A SUMMARY.

ONE OF THE QUESTIONS OUT THERE IS THE TOWNSHIP RESERVES CAN BE LOWERED TO $56 MILLION IN THOSE FUNDS COULD BE USED TO LOWER THE TAX RATE IF THE VOTERS CHOOSE NOT TO INCORPORATE.

THE PERSON I'M GONNA TALK ABOUT IS TO LOWER RESERVE FUND IN ORDER TO LOWER THE TAX RATE AND WE'VE ARTIE TALKED ABOUT THAT. THAT IS NOT SUSTAINABLE OR RECOMMENDED.

IT'S ACTUALLY NOT IN YOUR POLICIES. THE SECOND QUESTION IS IF WE LOWERED I'M NOT EXACTLY SURE WHERE THE $56 MILLION CAME FROM.

EVEN IF WE USED AT THE INCORPORATION RESERVE THAT WAS A RESERVE THAT WAS LOWERED AND WE WOULD STILL NEED TO FIND ANOTHER 28 MILLION. THE ONLY WAY TO DO THAT IS TO GO INTO YOUR CAPITAL REPLACEMENT RESERVE WHICH WOULD NEGATIVELY IMPACT THE CREDIT RATING AND REQUIRE ASSETS TO BE FINANCED AND RAISED AS THE SERVICE COMPONENT OF THE TAX RATE. IN SUMMARY AGAIN JUST TALKING WHEN WE TALKED ABOUT THESE THINGS IN THE INFORMATION THAT'S OUT THERE REGARDING THE INADEQUACIES OF THE INCORPORATION MODEL AND NOT BEING ACCURATE THAT WE HAVEN'T ACCOUNTED FOR THINGS CORRECTLY THIS IS SORT OF A SUMMARY SO FIRST EVOLVED LOOKING AT WHAT WAS TITLED AND CRITIQUED OF THE

[02:25:07]

LAW ENFORCEMENT REPORT. WE TALKED ABOUT THIS BEFORE BUT FOR THE CURRENT CONTRACTED LAW ENFORCEMENT PERSONNEL YOU CAN SEE THERE THE FUNDING FOR THEIR REPORT WAS 51.8 MILLION WE ARE ACTUALLY OVERFUNDED FROM WHAT THEY SAID BY $4.2 MILLION OF WHAT THEY REPORTED IS THAT WE WERE $7.2 MILLION IN THE HALL. THERE'S A BIG DISPARITY THERE. IN TERMS OF ADDING THE DIRECT LAW ENFORCEMENT STAFF WE ARE ACTUALLY ABOUT $65,000 OVERFUNDED FROM WHAT THEY HAVE IN THEIR REPORT. THE REPORT SAYS THERE ANYWHERE BETWEEN 4.8 MILLION AND $7.3 MILLION SHORT. IN TERMS OF LAW-ENFORCEMENT VEHICLES THERE IS A DIFFERENCE IN COST AT ZERO BECAUSE WE USE THE COST THAT IS PROVIDED BY US TWO MONTHS AGO BY THE MONTGOMERY COUNTY SHERIFF'S OFFICE FOR VEHICLES AND THEY SAY THAT WE ARE $6.4 MILLION

SHORT AND WE ARE FULLY FUNDED ON 135 VEHICLES. >> IT'S ALSO FAIR TO POINT OUT THAT WE ARE TALKING ABOUT BUYING TAHOE'S WHICH ARE MUCH MORE EXPENSIVE.

IT'S THE BULK OF THE SHERIFF FLEET. >> YOU ARE RIGHT.

BY THE TIME WE GET INTO THE FIVE-YEAR PLAN WE ARE AT $75,000 WHICH INCLUDES EQUIPMENT. TO YOUR POINT THESE ARE NOT CHEAP VEHICLES.

IN TERMS OF THE RF CONSULTING SERVICES REPORT THEY SAID THAT THE LAW ENFORCEMENT OPERATIONS WAS UNDERFUNDED BY 4.7 BILLION LAW-ENFORCEMENT CAPITAL WAS UNDERFUNDED BY 3 MILLION.

THE INCORPORATION MODEL INCLUDES COSTS FOR THE HYBRID MODEL THAT WAS VOTED ON.

IN TERMS OF THE STREET DEBILITATION THE REPORT WAS $2.5 MILLION SHORT.

NOT ONLY IS IT NOT SHORT BY THAT AMOUNT BUT IT ACTUALLY CONTINUES FUNDING AT $1.2 MILLION ANNUALLY FOREVER. THEN IN THE CORPORATION RESERVE THE REPORT SAID THAT IT WAS UNDERFUNDED BY $10.7 MILLION AND IN FACT THERE'S A $1.5 MILLION REMAINING IN THE RESERVE BEING FULLY FUNDED. WE JUST TALKED ABOUT THIS. THERE IS A DISPARITY BETWEEN THE BALANCES IN OUR RESERVE BALANCE SO THE REPORT IS CLAIMING THAT WE HAVE ACCUMULATED $49.7 MILLION OVER THE PAST FIVE YEARS AND THE FACT THAT IT'S $29.4 MILLION.

A LOT OF THAT WAS IN THE OPERATING RESERVE CAPITAL REPLACEMENT.

>> AGAIN JUST TO CLARIFY THAT CANNOT BE USED TO LOWER THE TAX RATE.

>> NOT BY POLICY. >> TO BE CLEAR THE THINGS THAT WE'VE USED IT FOR WHEN WE START TALKING ABOUT QUALITY OF LIFE WHEN I FIRST GOT ELECTED OUR SPORTS FIELDS WERE GRASS.

WE HAD A POSITIVE VARIANCE AND WE PUT IN THE STRICTER TURF. NOW HE WENT FROM HALF OF OUR SPORTS EVENT BEING CANCELED WITH MUDDY CONDITIONS AND NOW WE ARE 90% UP.

WE ADDED THE SPORTS FIELD COMPLEX AND BUILT THAT IN THE LAST DECADE.

WE ARE LOOKING AT REBUILDING THE FIRE STATIONS THAT'S ON SOME KIND OF UNSTABLE GROUND.

WE ALSO HAVE TO LOOK OUT FIVE YEARS BECAUSE WE PICK UP EXPENSES THAT YOU CAN'T SEE TODAY THAT WE KNOW ARE COMING TOMORROW. IN 2023 WE ABSORB THE WITHIN WATERWAY AND LIQUID FUNDS. THAT'S NOT A CURRENT EXPENSE THAT WE HAVE TODAY.

EVEN IF YOU LOOK AT THE BUDGET THIS YEAR WE HAVE A SMALL $600,000 AND WE COULD'VE SPENT.

WE HAVE TO BE FORWARD-LOOKING TO SAME 2023 WE PICK UP THIS EXTRA STUFF SO WE CAN'T JUST

LET THE MONEY GO. >> IS INCLUDED IN THE FIVE-YEAR PLAN.

I'VE BEEN THROUGH 10 BUDGETS AND 10 TAX RATES. AND BEING CRITIQUED ON THE FRONT PAGE HERE FOR ONE YEAR AND WE HAD A STIFF ARGUMENT OVER THE TAX RATE.

THAT WAS THE ONLY BUDGET PASSED IN MY ENTIRE TIME BEING HERE THAT HAD A NEGATIVE PROJECTION.

IT'S THE ONLY UNBALANCED BUDGET THAT WAS EVER PASSED. >> CARE TO ELABORATE ON THAT?

[02:30:03]

>> WE HAD A NEGATIVE BUDGET IN 2019 WITH OUR OWN PRODUCTIONS AND THE BOARD HAD A LOT OF ARGUING OVER IT AND TALKING ABOUT HOW MANY TIMES WE VOTED ON EFFECTIVE TAX RATE BUT ACTUALLY PUT US IN A NEGATIVE BUDGET FOR THE FIRST TIME IN THE 10 BUDGETS HAVE DONE WHICH

IS THE ONLY BUDGET I PASSED WITH A NEGATIVE OUTLOOK. >> I REMEMBER SITTING IN THE AUDIENCE WHEN I WAS GOING ON. I REMEMBER SHOWING THE PROJECTIONS NEGATIVE AND HOW YOU WERE VERY MUCH IN THE CAUTIONARY MODE. AS IF YOU ARE TELLING THE PEOPLE WHO SIT HERE TO BE VERY CAUTIOUS AS THIS IS NOT IN THE RIGHT DIRECTION OF WHAT THEY TRIED TO DO. UNFORTUNATELY CIRCUMSTANCES CAME CHANGED.

>> THINGS THAT OCCURRED AFTER THE FACT AND THE BUDGET WAS ADOPTED TURNED POSITIVE.

INTERNET SALES TAX WASN'T IN OUR BUDGET. >> BACK TAXES AS WELL.

THERE'S A CHANGE IN THE COMMUNITY SERVICES AGREEMENT THAT BROUGHT IN $600,000 IN NEW REVENUE THAT WASN'T IN OUR BUDGET. THE HOLDER NOT GET PLUGS BECAUSE THEY WERE LOOKING. WE HAVE TO GO DO THINGS DIFFERENTLY IN ORDER TO PLUG THAT HOLE. IF YOU GO BACK TO THE ORIGINAL CORPORATION STUDY WHERE WAS SAYING THE TAX RATE NEEDS TO BE HIGHER HALF OF THE NEEDED TAX RATE WAS ACTUALLY FILLING TO 2019 NEGATIVE BUDGET. IT WAS AN INCORPORATION RELATED.

IT WAS DUE TO US PASSING A BUDGET WITH A NEGATIVE OUTLOOK WHICH WAS IN THE ORIGINAL CORPORATION LOCK. I LOVE BEING CRITIQUED BUT THEY LEAVE OUT CONTEXT.

THE PUBLIC DESERVES TO KNOW AND THE BOARD WANTS TO HAVE BUDGET BALANCED .

>> SECOND WITH MY PRESENTATION. >> WITH THIS BE A GOOD TIME FOR THE PRESIDENT TO TALK A LITTLE BIT ABOUT WHAT WAS ASKED REGARDING SUPPLEMENTAL REVENUES

COMING IN FOR MAJOR CAPITAL PROJECTS? >> WE WOULD NOT TO HAVE HER

HERE FOR THIS LONG WITHOUT ANSWERING HER QUESTIONS. >> AGAIN JUST LIKE THE PUBLIC SAFETY REVENUES THAT CURRENTLY THEY ARE NOT ELIGIBLE FOR. THERE WOULD BE ADDITIONAL FUNDING SOURCES AVAILABLE THAT THE TOWNSHIP IS NOT ELIGIBLE FOR.

>> THERE BUILDING A CONVENTION CENTER AND A 250 ROOM REGENCY HOTEL IN PART FUNDED BY STATE SALES TAX AND STATE HOTEL TAX. THAT'S NOT THE LOCAL TAX IT'S A 6.25 STATE SALES TAX AND THE 6% STATE HOTEL OCCUPANCY TAX. SO 12.25% OF TAX REVENUE NORMALLY GOES TO THE STATE BUT WILL STAY IN THE CITY OF CONROE TO HELP FUND A CONVENTION CENTER WHICH WILL COMPETE WITH THE WOODLANDS WATERWAY MARRIOTT HOTEL AND CONVENTION CENTER. I HAVE SPOKEN WITH FRED DOMINIC AND THE GENERAL MANAGER OF THAT PROPERTY HE HAS CONFERRED TO ME THAT YES THAT WILL START IN THE MARKET SHARE. IF YOU RECALL THE SLIDE THAT SHOW THE PROPERTY TAXES ONLY FIND 36% OF OUR BUDGET AND 64% COMES FROM SALES AND HOTEL TAX. EXPECT THOSE NUMBERS IF WE CONTINUE TO HAVE COMPETITION AND OTHER AREAS. EXPECT THOSE NUMBERS TO BE MORE VOLATILE. IF WE WERE AT THE CITY THAT SAME CHAPTER 351 OF THE TEXAS TAX CODE AND SEAM APPLICATION APPLIED TO OUR CONVENTION CENTER EXPANSION PROJECT WHICH IS BEEN ON THE BOARD TO DO LIST FOR MANY YEARS. IT GENERATES $25-$26 MILLION IN STATE TAX REVENUE FILTERED BACK IN TO THE WOODLAND TOWNSHIP AND HELPS EXPAND OUR CONVENTION CENTER. CONROE'S GETTING $15 MILLION OUT OF THAT LAW AND WE ARE GETTING ZERO BECAUSE OF OUR CURRENT STATUS. I THINK THAT COVERS BECAUSE THAT'S ONE OF MANY OTHER STATE LAWS AND ECONOMIC DEVELOPMENT TOOLS THAT WE DON'T HAVE ACCESS

[02:35:02]

TO CURRENTLY. >> I WILL APOLOGIZE FOR THE LIKELINESS OF THE PRESENTATION BUT WE WANTED TO BE THOROUGH. ANOTHER CHAMBER LIKES TO HAVE POSSESSION AND THEY GAVE ME 15

MINUTES TO EXPLAIN THE CORPORATION TO YOU. >> I HAVE ONE MORE THING.

>> I THINK ONE MAJOR REPRESENTATION OF THEIR BEING MADE BY PEOPLE IN A COUPLE OF OTHER PACKS IS THAT THE INTENT OF THE BOARD IS TO CREATE A HIGHLY PAID PUBLIC OFFICIAL CITY COUNCIL. WHAT I WOULD LIKE IF YOU WOULD DISCUSS FOR US OR JEFF DISCUSS HOW THE PROCESS WORKS FROM THE PROJECT TOWNSHIP BOARD TO THE TEMPORARY COUNSEL TO THE ELECTION FOR THE FIRST COUNCIL AND HOW THE TRANSITION WORKS FROM BECOMING A TOWNSHIP AND EVENTUALLY PUTTING TOGETHER A HOME TO PUT IN THE CHARTER HOW THE CITY COUNCIL WILL ACTUALLY

FUNCTION, OPERATE AND WHETHER OR NOT THEY WOULD BE PAID. >> SHOULD THE BALLOT INITIATIVE PASSED IN NOVEMBER. THE NEXT DAY WE WOULD BE THE CITY OF THE WETLANDS.

THEN BOARD BECOMES THE INTERIM COUNCIL. THEY HAVE AUTHORITY TO ACT ON BEHALF OF THE GENERAL AUTHORITY. ONE OF THE THINGS WE ARE REQUIRED TO DO IS CALL FOR AN ELECTION OF THE CITY COUNCIL AND MAYOR WHICH WILL ACTUALLY SHRINK A NUMBER OF US APPEAR. THERE WILL BE A MAYOR AND FIVE COUNCILMAN.

WE WILL NOT BE GETTING PAID THE DAY AFTER REFERENDUM PASSES. THE NEW GROUP COMING IN WOULD BE THE FIRST OFFICIAL ELECTED CITY COUNCIL AND WOULD NOT BE PAID EITHER.

THE CHARTER IS A PROCESS FOR RESIDENTS AND CONSTITUTION. THE RESIDENTS WILL HAVE THE CHARTER. IT WILL BE VOTED UPON BY OUR RESIDENTS AND HAS TO BE APPROVED BY THEM WHICH SETS LIMITATIONS LIKE TERM LIMITS, PAY OR NO PAY.

THE REFERENDUMS TO RECALL ELECTED OFFICIALS WHETHER OR NOT YOU CAN DO ORDINANCES WITHOUT VOTER APPROVAL. THE CHARTER LAYS OUT THE AUTHORITY THAT THE RESIDENTS AGREED TO THE GOVERNMENT AND THE RESTRICTIONS THEY OPPOSE. THAT HAS TO BE VOTER APPROVED.

IT'S THE MOST LOCAL FORM OF GOVERNANCE BECAUSE RESIDENTS WRITE THE RULES.

HOPEFULLY THAT WAS THE GENERAL ASSEMBLY. >> MONIQUE YOU ARE FANTASTIC.

WE REALLY APPRECIATE EVERYTHING YOU DO FOR THE COMMUNITY. NOT JUST FOR THE PAST 29 EXTRA

FOR THE NEXT 29. >> WE HAVE ONE MY PRESENTATION ON THIS AGENDA ITEM.

TODD WAS IT LOADED? I'M GOING TO DO THE SUPERQUICK BECAUSE IT'S SOMETHING THAT TAL IN A CORPORATION. IT IS CRUCIAL FOR US THAT THE BOARD TO MAKE SURE WE HAD A MULTIYEAR TRANSITION AGREEMENT TO MAKE SURE THAT WE HAD PUBLIC SAFETY FOR TRANSITION OF LAW ENFORCEMENT IN THE EVENT WE BECOME A MUNICIPALITY. PIT WAS APPROVED BY THIS BOARD TO 0. THIS IS THE FOUNDATION OF A MULTIYEAR TRANSITION. THEY MADE THE AGREEMENT LESSON 12 MONTHS AGO. THIS INCLUDES THE SET PAY OVERTIME WITH FICA AND RETIREMENT BENEFITS. THAT INCLUDES MEDICAL AND ANYTHING ELSE THEY DECIDE THAT

[02:40:07]

IS ADDITIONAL IN THE BUDGET PROCESS. IT IS PASSED THROUGH THE TOWNSHIP. THIS DEALS WITH THE TRANSITION AGREEMENT.

ITS DIRECT PERSONNEL ON THE 19 FOLKS THAT ARE BEING PAID VERSUS THE 92 PEOPLE THAT WE CURRENTLY FUND. THE COUNTIES GOING TO PAY FOR HUNDRED PERCENT OF THE PERSONAL COST IN YOUR ONE. BY CONTACT. WHEN SOMEONE IS OUT THERE SAYING THE FACE OF PUBLIC SAFETY IS TO CHANGE THE DAY AFTER CORPORATION THEY ARE EITHER GROSSLY MISINFORMED AND FORGETTING THE AGREEMENTS THAT THEY SIGNED THEM BEFORE.

THE FACE OF LAW ENFORCEMENT DOESN'T CHANGE THE DAY AFTER CORPORATION IT REMAINS THE SAME. THAT SAME PATROL DEPUTIES SAME LEVEL OF SERVICE THAT WE HAVE ENFORCED TODAY. THE CITY WILL PICK UP ADDITIONAL COST IN YEARS TWO AND ON OUT BUT THERE IS NO THREAT TO OUR PUBLIC SAFETY THROUGH THIS PROCESS.

THIS IS A CHART SHOWINGTHE REDUCTION OF FORCE THAT COULD OCCUR AS THE ON BOARD TO CITY POLICE DEPARTMENT. THE MAXIMUM REDUCTION IS 0%. THAT MEANS THERE WILL BE ZERO CHANGE LEVELS OF SERVICE TO THE COMMUNITY. YEAR TO YOU CAN DRIVE DOWN 18 PERSONNEL TO THE CITY OF THE WASN'T POLICE DEPARTMENT SO THIS IS A SCHEDULED THOUGHTFUL MULTIYEAR TRANSITION IN ORDER TO MAKE SURE THAT WE HAVE WHAT WE NEED TO ENSURE WE HAVE PUBLIC SAFETY FOR THIS COMMUNITY. JILL SERVICES ARE PROVIDED BY THE COUNTY TO COUNTY WIDE AT NO COST. THAT'S PART OF OUR COUNTY TAX.

WE DID NOT INCLUDE DISPATCH AND DETECTIVES WITH MAJOR CRIMES. THIS IS OUR ACTUAL CONTACT THAT SHOWS THE SERVICES THE COUNTIES GOING TO PROVIDE TO OUR COMMUNITY.

THE SERVICE TODAY ARE CURRENTLY A ZERO COST WITH THE MUNICIPALITIES IN THE COUNTY.

WE DON'T HAVE DEFICIENCIES IN OUR PLAN. WE HAVE A FIVE YEAR TRANSITION AGREEMENT WITH SERVICES IN OUR CONTRACT. I FEEL VERY CONFIDENT AND WHAT'S BEEN PRESENTED BY THE PUBLIC. IT'S FACTUAL AND CONTRACTUAL.

WE WILL GET OFF OF THIS HIGH HORSE AND MOVE ON. THE CITY HAVE ANY QUESTIONS? I THINK WE ARE FATIGUED. WE WILL TAKE A MOTION AND A SECOND TO ACCEPT THE UPDATED REPORT. I WILL MAKE ONE COMMENT. I WANT TO BE FAIR TO ALL PARTIES. THEY DID NOT TALK TO OUR STAFF OR CONSULTANTS.

THEY RELIED UPON AGED DATA. WE MOVED THAT DATA FROM TWO YEARS AGO INTO OUR BASE BUDGET THEY PROBABLY DIDN'T HAVE A WAY TO FIND THE ACCURATE INFORMATION FOR THE CURRENT INFORMATION ABOUT A CONVERSATION WITH US. WE CAN INVITE THEM TO HAVE THAT CONVERSATION AND BE OPEN TO

[10. Receive, consider and act upon updates from the San Jacinto River Authority and the Woodlands Water Agency on water rates, odor control efforts, and the Wastewater Treatment Plant Consolidation Study (as requested by Director Sekula-Gibbs);]

[02:45:11]

I HAVE A GROUP WITH ME AND WE STAND READY TO ANSWER QUESTIONS.

UMA QUICKLY THROUGH TOPICS THAT WE WERE ASKED TO PROVIDE YOU WITH INFORMATION ON.

I DO HAVE A TEAM HERE WHO'S IN THE PROCESS OF TRYING TO RETIRE AND BECOME A PROFESSOR OF CIVIL

ENGINEERING >> IS TAKING OVER WHERE RON LEFT OFF.

I CAN'T THOUSAND ON THE STATE OF TEXAS WERE DOWN. NONE OF OUR SYSTEMS AT THE AUTHORITY OPERATIONS WERE DOWN IN FACT THAT INCLUDES OR WITHIN SYSTEMS WHERE WE SERVE CONSTITUENTS. WE WERE FILLING TANKER TRUCKS WITH WATER TO SEND OTHER PARTS OF TEXAS. I'M PROUD OF MY CREW AND WE'RE HAPPY TO SEE HIS USE HERE IN THE WOODLANDS. HERE ARE THE TOPICS THAT WE WILL COVER.

WILL MOVE RIGHT THROUGH THOSE. FIRST I WANT TO TOUCH THE TOPIC THAT I ASKED WITH A FEW MINUTES TO PRESENT. I WANT TO TALK ABOUT LONG-TERM WATER PLANNING AND ONE STRATEGY IN PARTICULAR THAT WE ARE USING TO MEET THE FUTURE NEEDS OF THE WATER FOR MONTGOMERY COUNTY.

THE MUNICIPALITIES WITH OTHER WATER PROVIDERS ARE WITH OUR PEERS ON THE WATER BUSINESS.

THE COUNTIES GOING SIGNIFICANTLY. THE NUMBER ACROSS THE BOTTOM SHOWS THAT WE ARE USING ABOUT 100,000 CRE-FEET AND IT T DEPENDS.

IT IS STILL PRETTY GOOD FOR YOU COULD SEE THE GROWTH. BY 2070 TABULATION IS EXPECTED FOR MONTGOMERY COUNTY AND WE'RE GOING TO HAVE TREMENDOUS NEED FOR ADDITIONAL WATER.

LOOK AT HOW WE DISSECT THOSE NEEDS AND MAKE PLANS ON HOW TO MEET THEM.

THE GREEN LINE IS THAT 290,000 ACRES WILL EVENTUALLY BE NEEDED AND THAT'S TOTAL DEMAND FOR THE COUNTY TO MOVE FORWARD IN THE FUTURE. THAT'S A LARGE PROJECT.