Minutes July 17, 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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HREF="id398.htm" TARGET="_top" TITLE="Minutes December 19, 2011"><U>Minutes December 19, 2011</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"> <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> July 17, 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 July 17, 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> John Irwin, Secretary</div> <bR> <div> and being absent: </div> <bR> <div> E.C. Norris, Assistant Secretary</div> <div> Darryl Box, Investment Officer</div> <bR> <div> Also present were Kathie Naumow, Recording Secretary; Terry Holland of Myrtle Cruz, Inc.; Brenda McLaughlin of Bob Leared Interests; Dusty Lane of Eco-Resources, Inc.; Marvin Zahradnik of Landev Engineers, Inc.; Mark Brooks of Young & Brooks.</div> <bR> <div> The meeting was called to order at 7:05 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 June 19, 2006 meeting were approved.</div> <bR> <div>  </div> <div> <B><U>QUESTIONS/COMMENTS FROM THE PUBLIC</U></B></div> <bR> <div> N/A</div> <bR> <div> <B><U>TAX ASSESSOR/COLLECTOR'S REPORT</U></B></div> <bR> <div>      Brenda McLaughlin presented the Tax Assessor/Collector report.  Taxes Receivable 8/31/2005: $16,911.61, reserve for uncollectables $635.83; adjustments $795.72.  Original 2005 Tax Levy: $1,172,903.87, adjustments $98,121.31.  Total Taxes Receivable: $1,288,096.68.  Prior years taxes collected $11,280.85, 2005 taxes collected $1,234,937.08.  Taxes Receivable at 6/30/2006: $41,878.75.  2005 Receivables: Debt Service $27,250.20; Maintenance $8,837.90.  Month of 6/2006: beginning cash balance $55,437.54, total receipts $14,293.20, total disbursements $32,983.52, cash balance at 6/30/2006 $36,747.22.  Total Disbursements for the month of July 2006 $15,652.10, remaining cash balance $21,095.12.  The district is 99.978% collected for 2001 taxes, 99.929% for 2002 taxes, 99.957% for 2003 taxes, 99.712% for 2004 and 97.161% for 2005.  Presented board with a list of the top delinquent taxpayers.</div> <bR> <div>  </div> <div> After discussion and 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 May 2006 Operations Report.  Total connections were 1495.  Meter installations and inspections for Apr 14 - May 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 6/2006.  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 28,314,000 at Water Plant #1, Total supplied - 28,314,000, Daily Average - 943,800.  Subsidence Information: Estimated number of months available - 7.9, Permit months remaining - 6, Percent of permitted production - 42.91.  Water Accountability is at 95% Year to Date.  Total Operations Charges $20,678.87.  Actual work related costs - $1,820.00.  Total Current billing -  $74,021.16.  Total Aged Receivables $20,407.43.  Total Accounts Receivables $94,428.59.  Facility Checklist completed: Water Plant #1 on 6/13/2006.  Inspections Completed: Fire Hydrants on 12/28/2005.  Provided Discharge Monitoring Report, number exceeded all zero.  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.  </div> <bR> <div> Checked NLV Section 6 drainage lines and no blockage found.  Discussed low areas in the district.  Reported problem with online pay, it will not take dashes.  </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.  Checked plant for painting of ground storage tanks and no major peeling.   Said it looked more like grit.  May want to look at sandblasting and 2 or 3 coats to hydro tanks inside.  Possibly $8,000 to $10,000 for hydro tanks.  Marvin recommends being done in late fall.  Takes approx. 2 weeks and do one tank at a time.</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 July 17, 2006 - $2,856,225.53.  Total Debt Service Requirements for 2006: $1,349,070.00.  General Operating: Previous cash balance June 19, 2006 - $1,251.95 total deposits $75,179.88.  Beginning cash balance July 17, 2006 - $75,402.01.  General Operating Funds available July 17, 2006 - $1,930,451.49.  Included copy of budget for fiscal year ending September 30, 2006, Investment Report and Tex Pool Performance sheet.  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>     </B></div> <div> <B><U>AUTHORIZE ANY NECESSARY ACTIONS WITH RESPECT TO NLV SECTION 6 DRAINAGE</U></B></div> <bR> <div>      Discussed drainage during heavy rain.  Dusty checked NLV Section 6 drainage lines and no blockage found.  Will monitor situation.</div> <bR> <div> <B><U>CINCO REGIONAL OPERATING COMMITTEE REPORT</U></B></div> <bR> <div>      Tony reported on the status of the Cinco Plant improvement construction.  Reported chlorine disinfection system running manually.</div> <bR> <div> <B><U>AUTHORIZE ANY NECESSARY ACTIONS WITH RESPECT TO GREENBELT TRACTS OR OTHER DISTRICT LAND</U></B></div> <bR> <div> Sprinkler heads need repairing; they are spraying into the street.  Motion made and approved to have the one head repaired and evaluate the entire system.</div> <bR> <div> <B><U>PENDING BUSINESS</U></B></div> <bR> <div>      Mark asked if the board wants to request bids for auditor this year.  Board will stay with BKD unless rates are out of line.  Mark informed board he will not be at the August meeting.  Scott will attend in his absence.</div> <bR> <div> After concluding and there being no further business to come before the board, the meeting was adjourned at 7:57 p.m.</div> <bR> <bR> <div>                                                                                                                         _______________________________</div> <div>                                                                                                                         Secretary</div> <bR> <div> Attachments:     Bookkeeper's Report</div> <bR> <bR> </td> </tr></table></body>