Minutes March 20, 2006

<body topmargin=0 leftmargin=0 marginheight=0 marginwidth=0> <table cellpadding=0 cellspacing=0 border=0><tr> <td valign="top" colspan=2 height=125 BGCOLOR="#996699" TEXT="#080000" bgproperties="fixed" background="1da467d1erlcll.gif"> <div> <FONT SIZE="5" COLOR="#FFFFFF" FACE="Arial" ><B>Cornerstones Municipal Utility District</B></FONT><B>     </B><B>|     </B><A HREF="index.htm" TARGET="_top" TITLE="Cornerstones Municipal Utility District"><U><B>home</B></U></A></div> <div> back to<B>  </B><A HREF="id27.htm" TARGET="_top" TITLE="Archived Minutes"><U><B>Archived Minutes</B></U></A></div> <div> </div> </td> </tr><tr> <td valign="top" width=190 BGCOLOR="#FFFFFF" TEXT="#080000"> <div> <A HREF="id190.htm" TARGET="_top" TITLE="Minutes January 19, 2004"><U>Minutes January 19, 2004</U></A></div> <div> <A HREF="id196.htm" TARGET="_top" TITLE="Minutes February 16, 2004"><U>Minutes February 16, 2004</U></A></div> <div> <A HREF="id197.htm" TARGET="_top" TITLE="Minutes March 15, 2004"><U>Minutes 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2010"><U>Minutes July 19, 2010</U></A></div> <DIV ALIGN="LEFT"></DIV> <div> <B><IMG SRC="21f46600.gif" border=0 width="70" height="96" ALIGN="BOTTOM" HSPACE="0" VSPACE="0"></B></div> </td> <td valign="top" height=355 BGCOLOR="#FFFFFF" TEXT="#080000"> <bR> <div> <B>CORNERSTONES MUNICIPAL UTILITY DISTRICT</B></div> <DIV ALIGN="LEFT"></DIV> <div> <B>CORNERSTONES MUNICIPAL UTILITY DISTRICT</B></div> <div> Minutes of Meeting of Board of Directors</div> <div> March 20, 2006</div> <bR> <bR> <div>      The Board of Directors of Cornerstones Municipal Utility District (the “District”) met at 805 Hidden Canyon, Katy, Harris County, Texas at 7:00 p.m. on March 20, 2006, in accordance with the duly posted notice of said meeting, with a quorum of directors present as follows:</div> <bR> <div> Tony Garza, President</div> <div> Gary Hughes, Vice President</div> <div> E.C. Norris, Secretary</div> <div> John Irwin, Assistant Secretary</div> <div> Darryl Box, Investment Officer </div> <bR> <div> and being absent: </div> <bR> <div> None</div> <bR> <div> Also present were Kathie Naumow, Recording Secretary; Terry Holland of Myrtle Cruz, Inc.; Bob Leared of Bob Leared Interests; Dusty Lane of Eco-Resources, Inc.; Marvin Zahradnik of Landev Engineers, Inc.; Mark Brooks of Young & Brooks and Doug Konopka of Cinco LTD.</div> <bR> <div> The meeting was called to order at 7:00 and declared open for such business as might come before it.</div> <bR> <div> <B><U>APPROVE MINUTES OF PRIOR MEETINGS</U></B></div> <bR> <div>      After discussion, upon motion duly made, seconded and unanimously carried, the minutes of the February 20, 2006 meeting were approved.</div> <div>  </div> <bR> <div> <B><U>QUESTIONS/COMMENTS FROM THE PUBLIC</U></B></div> <bR> <div> N/A</div> <bR> <div> <B><U>RATIFY APPROVAL OF REVISED AGREEMENT FOR SERVICES OF TAX ASSESSOR AND COLLECTOR</U></B></div> <bR> <div>  Motion made to ratify approval of revised agreement for services of tax assessor and collector.   After discussion, motion was seconded and unanimously carried.</div> <bR> <div> <B><U>TAX ASSESSOR/COLLECTOR'S REPORT</U></B></div> <bR> <div>      Bob Leared presented the Tax Assessor/Collector report.  Taxes Receivable 8/31/2005: $16,911.61, adjustments $635.83.  Original 2005 Tax Levy: $1,172,903.87, adjustments $80.210.84.  Total Taxes Receivable: $1,270,191.21.  Prior years taxes collected $7,322.05, 2005 taxes collected $1,178,571.41.  Taxes Receivable at 2/28/2006: $84,297.75.  2005 Receivables: Debt Service $56,287.79; Maintenance $18,255.51.  Month of 2/2006: beginning cash balance $507,850.53, total receipts $22,252.06, total disbursements $483,955.82, cash balance at 2/28/2006 $46,146.77.  Additional disbursements for  the month of February, 2006 $520.28.  Total Disbursements for the month of March, 2006 $18,954.94, remaining cash balance $27,191.83.  The district is 99.978% collected for 2001 taxes, 99.912% for 2002 taxes, 99.940% for 2003 taxes, 99.435% for 2004 and 94.051% for 2005.  Mailed out delinquent statements.  If taxes not paid by July 1st 30% penalty and interest will be assessed.</div> <bR> <div>  </div> <div> Upon motion duly made, seconded and unanimously carried, the board approved the tax assessor/collector's report and payment of the tax bills presented. </div> <bR> <div>      </div> <div> <B><U>FINANCIAL ADVISOR</U></B></div> <bR> <div>      N/A     </div> <bR> <div> <B><U>OPERATOR'S REPORT</U></B></div> <bR> <div> Dusty Lane of Eco-Resources, Inc., the District's operator, reported as to District operations and facilities and presented the February 2006 Operations Report.  Total connections were 1493.  Meter installations and inspections for Jan 14 - Feb 13:  New taps Installed - 0; Abandoned connections - 0; Sewer inspections completed - 1; Builder Inspections completed - 0; Customer Service inspections completed - 0; Net Rental Meter Change - 0.  Wastewater treatment; Permitted Average Daily Flow - 3,000,000GPD.  The required 7 samples were taken during 2/2006.  TCEQ Chemical Analysis: Metals 8/25/99; Radio-Chemicals 08/11/05; Volatile Organic Chemicals 8/11/05; Minerals 8/11/05.  Water production: Pumped 15,169,000 at Water Plant #1, Total supplied - 15,169,000, Daily Average - 551,750.  Subsidence Information: Estimated number of months available - 17.7, Permit months remaining - 10, Percent of permitted production - 10.11.  Water Accountability is at 95% Year to Date.  Total Operations Charges $16,550.95.  Total Current billing -  $54,036.09.  Total Aged Receivables $16,875.62.  Total Accounts Receivables $70,911.71.  Facility Checklist completed: Water Plant #1 on 2/15/2006.  Inspections Completed: Fire Hydrants on 12/28/2005.  Total Deposits for February 2005 $49,247.57.  Disconnects/Reconnects income: $25.00.  Pull Fees: $0.00.  Provided Discharge Monitoring Report, number exceeded all zero.  Advised Harris County had drop in chlorine level due to failure in chlorine system.  Reported on repairs made and also presented the board with a copy of the Cornerstones M.U.D. Delinquent list.   Everyone has been duly notified of situation and it is being addressed.  No customer requests.  </div> <bR> <div> Upon motion duly made, seconded and unanimously carried, the board approved the operator's report.</div> <bR> <div> <B><U>ENGINEER'S REPORT</U></B></div> <bR> <div> Marvin reported on activities in the district.  No new requests.  Advised grease trap not needed.  Doug Konopka gave update on property activity in the district.  Wendy's deal is out due to distance to other Wendy's. </div> <bR> <div> Upon motion duly made, seconded and unanimously carried, the board approved the Engineers report.</div> <bR> <div> <B><U>BOOKKEEPER'S REPORT</U></B></div> <bR> <div> Terry Holland of Myrtle Cruz, Inc., the District's bookkeeper, presented the monthly report.  Debt service funds available March 20, 2006 - $2,957,992.34.  Total Debt Service Requirements for 2006: $1,349,070.00.  Capital projects funds available March 20, 2006 - $139,631.18.  General Operating: Previous cash balance February 20, 2006 - $14,970.41, total deposits $69,183.73.  Beginning cash balance March 20, 2006 - $82,981.94.  General Operating Funds available March 20, 2006 - $1,773,714.35.  Included copy of budget for fiscal year ending September 30, 2006, Investment Report and Tex Pool Performance sheet.    Gave update on Entergy & Constellation bills.  After discussion, upon motion duly made, seconded and unanimously carried, the board approved report and said bills and ordered checks issued on the appropriate District accounts in payment thereof.  </div> <bR> <div> <B><U>CONDUCT HEARING ON TERMINATION OF WATER AND SEWER SERVICE </U></B></div> <bR> <div> The board conducted a hearing on the termination of utility service.  The operator presented a list of delinquent utility accounts that were delinquent by more than 60 days and reported that the customers have been given written notice 10 days prior to this meeting and the opportunity to appear before the board of directors to explain, contest or correct the utility service bill and to show reason why the utility service should not be terminated for nonpayment.  None of the customers on the list were present or have presented any statement on the matter.  After discussion, upon motion duly made, seconded and unanimously carried, the board authorized the operator to terminate utility service to the unpaid accounts in accordance with standard procedures.</div> <bR> <div> <B><U>DISCUSS AND POSSIBLY AMEND WATER AND SEWER RATE ORDER TO SHORTEN CUT-OFF DATE FOR DELINQUENT ACCOUNTS</U></B></div> <bR> <div>      Currently, customers have till 20th day to pay then a 10% penalty is applied.  Then you have to wait 60 days to do a turn off.  Motion made to shorten turn off date to 30 days.  After discussion, upon motion duly made, seconded and unanimously carried, the board approved request to shorten cut-off date to 30 days. </div> <bR> <div>      </div> <div> <B><U>AUTHORIZE ANY NECESSARY ACTIONS IN CONNECTION WITH PENDING DIRECTORS ELECTION, INCLUDING TO POSSIBLY ADOPT ORDER FOR CANCELLATION OF ELECTION</U></B></div> <bR> <div>      Mark advised that no opposition candidates have signed up.  Motion made to cancel elections.   After a vote of 3 for (John, Tony and Chip) and 2 abstain (Daryl and Gary) the board cancelled the election.</div> <bR> <div>      <B>     </B></div> <div> <B><U>CINCO REGIONAL OPERATING COMMITTEE REPORT</U></B></div> <bR> <div>      Tony gave updates of meeting from Cinco Regional Operating Committee.  Plans were approved and should receive first bill in a few months.  The cost will roll over into two separate years.</div> <bR> <div>      </div> <div> <B><U>AUTHORIZE ANY NECESSARY ACTIONS WITH RESPECT TO GREENBELT TRACTS OR OTHER DISTRICT LAND</U></B></div> <bR> <div>      N/A</div> <bR> <div> <B><U>PENDING BUSINESS</U></B></div> <bR> <div>      Memos are going out to all directors regarding training.  All directors need to take training for the open records act.  The training can be done online or DVD version.  Dusty and Marvin reported that the cost for the restart system for the plant would be approximately $20,000.00.  Gary reported on the AWBD conference.</div> <bR> <div> After concluding and there being no further business to come before the board, the meeting was adjourned at 7:53 p.m.</div> <bR> <div>                                                                                                                                       _______________________________</div> <div>                                                                                                                                       Secretary</div> <bR> <div> Attachments:     Bookkeeper's Report</div> <bR> <bR> </td> </tr></table></body>