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Home My WebLink AboutColleyville Economic Development Corporation (CEDC)-Agenda Packets-9/9/2003 City of Texas PUBLIC NOTICE ON TUESDAY, SEPTEMBER 9,2003, AT 6:45 P.M., IN THE CITY COUNCIL CHAMBERS, 5400 BRANSFORD ROAD, THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION BOARD OF DIRECTORS WILL HOLD A MEETING FOR THE FOLLOWING PURPOSE: CONSENT: 1. CONSIDERATION OF CONSENT RESOLUTION R-03-54 - CONSENT ITEMS: a. Approval of minutes of the Colleyville Economic Development Corporation Board of Directors meeting held September 10, 2002 PUBLIC HEARINGS: 2. READING AND PUBLIC HEARING - RESOLUTION R-03-55 - A Resolution appointing a Colleyville Economic Development Corporation President and Vice President 3. READING AND PUBLIC HEARING - RESOLUTION R-03-56 - A Resolution adopting the Economic Development Capital Improvement Program (EDCIP) for 2004 - 2008 4. READING AND PUBLIC HEARING - RESOLUTION R-03-57 - A Resolution adopting the Fiscal Year 2004 Budget 5. READING AND PUBLIC HEARING - RESOLUTION R-03-58 - A Resolution approving the amendment of the Bylaws of the Colleyville Economic Development Corporation P.O. BOX 185 COLLEYVILLE, TEXAS 76034 (817) 577-7575 CEDC AGENDA AUGUST 25, 2003 ACTION ITEMS: 6. READING AND PUBLIC HEARING - RESOLUTION R-03-59 - A Resolution revising the Colleyville Economic Development Corporation Investment Policy REPORTS: 7. ANNUAL ACTIVITY REPORT 8. ANNUAL INVESTMENT REPORT 9. READING AND PUBLIC HEARING - RESOLUTION R-03-60 - A Resolution ratifying Corporate Board action for the meeting of September 9,2003 ADJOURNMENT: 10. ADJOURNMENT I certify that the above notice was posted on the Bulletin Board at City Hall on August 29, 2003 at 5:00 p.m. c~:;on~~ City Secretary MINUTES OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION BOARD OF DIRECTORS MEETING SEPTEMBER 10, 2002 The meeting of the Colleyville Economic Development Corporation Board of directors was called to order by President Joe Hocutt on September 10, 2002, at 6:45 p.m. ROLL CALL: Directors Donna Arp, Brad Rice, Donna O'Brien, and Janice Cole were present. President Joe Hocutt, City Manager Bill Lindley, Deputy City Manager Dianne McWethy, Finance Director Terry Leake, Community Development Director Barry LeBaron, Administrative Assistant Cindy Martin and City Secretary Cynthia Singleton were also present. Directors Ginny Tigue and Gary Cantrell were absent. CONSENT: 1. CONSIDERATION OF CONSENT RESOLUTION R-02-49 - CONSENT ITEMS: a. Approval of minutes of the Colleyville Economic Development Corporation Board of Directors meeting held September 11, 2001 b. Approval of an Agreement for Arbitrage Rebate Compliance Services with First Southwest Asset Management, Inc. c. Approval of a Depository Pledge Agreement with Wells Fargo Bank Texas, N.A. d. Approval of a Pledge Agreement with the Federal Reserve Bank of Boston President Hocutt opened the public hearing and read Resolution R-02-49 in its entirety. There was no one present wishing to speak concerning this item and President Hocutt closed the public hearing. Director Rice moved to approve Resolution R-02-49. Director O'Brien seconded the motion. Director Arp stated, regarding Item c, that the bank is determined through a bidding process. CEDC MINUTES SEPTEMBER 10, 2002 Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the motion carried. PUBLIC HEARINGS: 2. READING AND PUBLIC HEARING - RESOLUTION R-02-50 - A Resolution appointing a Colleyville Economic Development Corporation President and Vice President President Hocutt opened the public hearing and read Resolution R-02-50 in its entirety. There was no one present wishing to speak concerning this item and President Hocutt closed the public hearing. President Hocutt called for nominations for President. Director Rice nominated Joe Hocutt for President. Director Cole seconded the motion. Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the motion carried. President Hocutt called for nominations for Vice-President. Director Arp nominated Brad Rice for Vice-President. Director O'Brien seconded the motion. Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the motion carried. 3. READING AND PUBLIC HEARING - RESOLUTION R-02-51 - A Resolution adopting the Economic Development Capital Improvement Program (EDCIP) for 2003 - 2007 2 CEDC MINUTES SEPTEMBER 10, 2002 President Hocutt opened the public hearing and read Resolution R-02-51 in its entirety. There was no one present wishing to speak concerning this item and President Hocutt closed the public hearing. Discussion ensued regarding the parkland purchase and city markers. Director Rice moved to approve Resolution R-02-51 with the amendment to transfer funds designated for city markers to the General Fund. Director Cole seconded the motion. Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the motion carried. 4. READING AND PUBLIC HEARING - RESOLUTION R-02-52 - A Resolution adopting the Fiscal Year 2003 Budget President Hocutt opened the public hearing and read Resolution R-02-52 in its entirety. There was no one present wishing to speak concerning this item and President Hocutt closed the public hearing. Director Terry Leake provided an overview ofthe Fiscal Year 2003 Budget. Director Arp moved to approve Resolution R-02-52. Director O'Brien seconded the motion. Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the motion carried. ACTION ITEMS: 5. 'DISCUSSION AND CONSIDERATION OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION INVESTMENT POLICY 3 CEDC MINUTES SEPTEMBER 10, 2002 Finance Director Terry Leake provided an overview of the Colleyville Economic Development Corporation Investment Policy. REPORTS: 6. ANNUAL ACTIVITY REPORT There was no action taken on this item. 7. ANNUAL INVESTMENT REPORT There was no action taken on this item. 8. READING AND PUBLIC HEARING - RESOLUTION R-02-53 - A Resolution ratifying Corporate Board action for the meeting of September 10, 2002 This Resolution was not needed. ADJOURNMENT: 9. ADJOURNMENT There being no further business before the Board, Director Arp moved to adjourn. Director Rice seconded the motion. Ayes: Directors Donna Arp, Brad Rice, Donna O'Brien, Janice Cole and President Joe Hocutt Nays: None President Hocutt declared the meeting adjourned at 7:14 p.m. APPROVED THIS AYES, DAY OF NAYS AND 2002, BY A VOTE OF ABSTENTIONS. Minutes taken and prepared by: Cynthia Singleton, TRMC City Secretary 4 CEDC cc~" AGENDA BRIEFING TL'X"'; MEETING DATE: i ITEM # : i RESOLUTION # : i 09/09/03 2 R-03-55 GENERAL MANAGER DEPARTMENT HEAD i FINANCE MANAGER ! Previous Action: None DEPARTMENT: CITY MANAGER'S OFFICE SUBJECT: Appointing a Colleyville Economic Development Corporation President and Vice President Reading and Public Hearing As per the Article III, Officers, the President and Vice President shall be elected by the Board and shall serve a term of one (1) year. The President and Vice President shall continue to serve until their successors are appointed as provided in Article II, Section 1. (See attached). On September 10, 2002, the Board of Directors appointed Joe Hocutt to serve as President and Brad Rice to serve as Vice President. The positions of President and Vice President are currently vacant. On the basis of the above, the Board of Directors will need to elect a President and Vice President of the Colleyvil/e Economic Development Board of Directors. Financial Impact None Recommendation Approval Attachments · Excerpts of Articles of Incorporation, Article III, Colleyville Economic Development Corporation · Colleyville Economic Development Corporation Roster · Resolution R-03-55 " 035:':26 C. The Secretary of the Corporation shall act as Secretary of all meetings of the Corporation, but in the absence of the Secretary, the presiding officer may appoint any person to act as Secretary of the meeting. The Secretary shall keep minutes of the transactions of the Board and committee meetings and shall cause such official minutes to be recorded in books kept for that purpose in the principal office of th€ Corporation. SECTION 6. COMMITTEES OF THE BOARD. An official committee of the Board shall consist of two (2) or more directors. It is '. provided, however, that all iinal official actions of the Corporation may b€ €xercised only by the Board. Each committee so designated shall keep regular minutes of the transactions of its meetings and shall cause such minutes to be recorded in books kept Tor that purpose in the prinCipal office of the Corporation. SECTION 7. COMPENSATION OF DIRECTORS. The directors, including the President and Vice President, shall not receive any salary or compensation for their services. However, directors may be reimbursed for their actual expenses incurred in the performance of their duties hereunder, including but not limited to the cost of travel, lodging and incidental expense~ reasonably related to the corporate duties of the Board. Travel expenses incurred by directors for both regular and special meetings are not eligible for reimbursement. ARTICLE III. OFFICERS SECTION 1. TITLES AND TERM OF OFFICE. The President and Vice Presiden t shall be elected by the Board and shall serve a term of one (1) year. The President and Vice President shall continue to serve until their successors are appoin ted as provided in Article II, Section 1. SECTION 2. POWER S AND DUTIES OF THE PRESIDENT. The President shall be the chief executive officer of the Corporation, and shall preside at all meetings of the Board, and absent any different designa tion by a majority of the Board, shall sign and execute all contracts, conveyances. franchises, bonds, deeds, assignments, mortgages, and notes in the name of the Corporation. In addition the President shall: -4- ft Qj5::!":~6 ;, A. call both regular and special meetings of the Board and establish the agenda for such; B. shall endorse and countersign, on behalf of the Corporation, for collection or issuance, checks, notes and other obligation s in or drawn upon such bank or banks or depositories as shall be designated by the City Council consistent with these Bylaws. 1, C have the authority to appoint standing or study committees to aid and assist the Board in its pusiness undertaking or other matters incidental to the operation and functions of the Board; !! !: ; D. perform all duties incident to the office, and such other duties as shall be prescribed from time to time by the Board, subject to approval by the City Council; E. appear before the City Council on a periodic basis to give a report on the status of activities of the Corporation; and F. appear before the City Council, or be represented by his designee, regarding any item being considered by the City Council concerning the Corporation. SECTION 3. VICE PRESIDENT. The Vice President shall exercise the powers of the President during that ofiicer's absence or inability to act. The Vice President shall also periorm other duties as from time to time may be assigned by the President or the Board. SECTION 4. ATTENDANCE. Directors must be present in order to vote at any meeting. Regular attendance at the Board meetings is required of all directors. The following number of absences shall constitute the basis for replacement of a director. Three (3) consecutive unexcused absences from meetings of the Board shall cause the position to be considered vacant. In addition, the position of any director who has four (4) unexcused absences in a twelve (12) month period shall also be considered vacant. -5- Colleyville Economic Development Corporation Jon Ayers 4808 Meandering Way Colleyville, TX 76034 W 817.267.9009 H 817,267.1630 F 8173180663 M: 972.571.6647 aversi@ci.collevville.lx.us TERM June 2003 - May 2004 Gary Cantrell 3400 Glade Road Colleyville, TX 76034 W817.571.4834 H: 817.571.4834 TERM: September 2001 - 2003 Janice Cole 103 Van Buren Court Colleyville, TX 76034 H 817.498,1898 M 817.371.6840 ianicecole1066@comcasl.nel TERM September 2001 - 2003 Rich Hendler 2100 Highland Meadows Colleyville, TX 76034 W 817.421.8165 H: 817.421.8164 F: 817.428.8966 hendlerr@ci.collevville.lx.us TERM: June 2003 - May 2004 Donna O'Brien 3104 SI. Alban's Circle Colleyville, TX 76034 H 817,355.9575 obrien999(cj)comcasl.nel TERM: September 2001 - 2003 Mark Skinner 4108 Greenway Court Colleyville, TX 76034 W 817.608.8201 H: 817.498.5698 F: 817.608.8239/817.514.6664 M: 214.957.1834 skinnerm@ci.collevville.lx.us TERM: June 2003 - May 2005 Ginny Tigue 4415 Meandering Way Colleyville. TX 76034 H 817.267.5527 F 817.540,1466 M 8172331697 Iloueo(cj)ci. collevville. lx.us TERM May 2002 - 2004 GENERAL MANAGER Bill Lindley 2402 Broadoak Way Colleyville. TX 76034 W 817,577.7575 H 817.410.2338 F 817577.7555 Ilndlevw@cl.collevville.lx.us FINANCE MANAGER Terry Leake 503 Spring branch Drive Keller, TX 76248 W: 817.577.7575 H 817.379,5014 lea kel@cj.collevville.lx.us SECRETARY Cynthia Singleton 6000 Ronna Court Colleyville. TX 76034 W 817.577.7575 H: 817.488,1011 F: 817.577.7555 sino lelonc(cj)ci. collevvi lie. Ix. us Revised 06/30/03 RESOLUTION R-03-55 A RESOLUTION APPOINTING A COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION PRESIDENT AND VICE PRESIDENT WHEREAS, in accordance with Article III, Officers, the President and Vice President shall be elected by the Board and shall serve a term of one (1) year. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION: Sec. 1. THAT Director shall be appointed to serve as President of the Colleyville Economic Development Corporation. Sec. 2. THAT Director shall be appointed to serve as Vice President of the Colleyville Economic Development Corporation. AND IT IS SO RESOLVED. PASSED AND ADOPTED, this September 9,2003. COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton Secretary CEDC .@ AGENDA BRIEFING Tl'.~:;"l$ MEETING DATE: ! 09/09/03 GENERAL MANAGER ITEM # : 3 DEPARTMENT HEAD RESOLUTION # : R-03-56 FINANCE MANAGER Previous Action: None DEPARTMENT: FINANCE SUBJECT : A Resolution adopting the Economic Development Capital Improvement Program for 2004 - 2008 Reading and Public Hearing The CEDC By-laws require that annually the Board develop a combined Economic Development Capital Improvement Program, (EDCIP) which sets forth long and short-term goals. This program "shall be one that addresses the development needs of the City within the financial constraints available to the Corporation". The "EDCIP shall identify the projects to be undertaken by the Corporation and include proposed methods and the expected cost of implementation". After the EDCIP is developed, it must be approved by the City Council. Staff will provide an overview of current and future park projects, including master plans and cost estimates and review the priorities established and recommended by the Parks and Recreation Advisory Board at their August 21, 2002 meeting. (See attached report) For the Board's information, the current EDCIP for FY 2003 - FY 2007 is included in the briefing as Exhibit 1. For the FY 2004 - FY 2008 EDCIP (Exhibit 2) the following revenue and expenditure changes were proposed: reducing the sales tax revenue to Y2 the amount in the proposed FY 2004 City of Colleyville General Fund budget with a 4% annual in the remaining years, moving the $393,000 allocated to the trails grant match to FY 2005, and moving the funds proposed for park land purchase out one more year (FY 2006 - $325,000 / FY 2007 - $300,000 / FY 2008 $300,000). These changes are proposed to accommodate the revised revenue projection and to retain the fund balance at an acceptable level. Recommendation Approval Attachments . Overview of Current and Future Park Projects . Exhibit 1 - FY 2003-2006 EDCIP . Exhibit 2 - FY 2004-2008 EDCIP . Resolution R-03-56 MEMORANDUM TO: Colleyville Economic Development Corporation Board of Directors FROM: Dianne McWethy, Deputy City Manager Monica Sue Walsh, Parks and Recreation Director DATE: September 4, 2003 SUBJECT: Economic Development Capital Improvement Program (EDCIP) for FY2004-2008 Among the primary responsibilities of the Colleyville Economic Development Corporation (CEDC) Board of Directors is the adoption of a five-year plan and an annual budget. The five-year plan was last updated in September 2002 and is attached for your reference. Historically, the CEDC Board has limited the use of funds to capital expenditures and a small administrative charge. The plan for FY2004-2008 strives to maintain this philosophy. Many of the projects in the plan are related to the Parks and Recreation Department. On August 4, 2003, the Parks and Recreation Advisory Board established their priorities. (See attached). In consideration of establishing their priorities, the Parks and Recreation Advisory Board reviewed the citizen priorities based on the Comprehensive Parks, Recreation and Open Space Master Plan. (See attached). The proposed FY2004-2008 EDCIP attempts to incorporate some of the Parks and Recreation Advisory Board identified priorities: 1 . Recreation Center 2. McPherson Park, Phase I 3. Park Land Purchase 4. Sneed Property 5. Cotton belt Trail, Phase III 6. Pleasant Run Practice Park, Phase II 7. Little Bear Creek Trail Extension 8. Senior Center 9. McPherson Park, Phase II 10. ADA Improvements 11. McPherson Park, Phase III 12. Longwood Trail 13. Park Maintenance Building 14. Bransford Park, Phase II 15. McPherson Park, Phase IV 16. Adjacent Hike and Bike Trails 17. Uniform Park Signage 18. New Tennis Courts 19. Heritage Middle School Football Lights Revenue The sole source of revenue for the CEDC budget is a one-half cent sales tax. The revenue projection in this plan includes the estimated amount to be received in FY2003 and reduces the sales tax revenue to Y2 the amount in the proposed FY2004 City of Colleyville General Fund budget with a 4% annual in the remaining years. These changes are proposed to accommodate the revised revenue projection and to retain the fund balance at an acceptable level. Projects In preparing recommendations for the update of the five-year plan, we first reviewed projects, included in the current plan: 1. Bransford Park Webb House rehabilitation 2. City entrance markers 3. Library start-up 4. McPherson Park Master Plan 5. Park land purchase 6. Pleasant Run Practice Park 7. Pleasant Run Practice Park land purchase 8. Trails (Cotton belt Trail III and Little Bear Creek Trail Extension) In FY2002, the City Council approved the contract with Talent Restoration Company, in the amount of $349,427, for rehabilitation of the Webb House, which is located in Bransford Park. The restoration of the Webb House has been completed. No additional funds are proposed for Bransford Park, Phase II. The current plan includes $500,000 for start-up costs associated with the Colleyville Public Library. We anticipate the opening of the City Hall and Library in Fall 2003. The current plan provides monies for Phase I of the McPherson Park, which includes a walking trail, picnic and playground areas, entry road, fishing pond, unstructured play areas, recreation amenities and pavilion with a restroom. There are no funds allocated for future phases of the park. The Parks and Recreation Advisory Board ranked McPherson Park, Phase I, as priority number 2. The purchase of parkland is priority number 3 of the Parks and Recreation Advisory Board. The proposed EDCIP plan proposes $925,000 for the purchase of parkland in FY2005, FY2006 and FY2007. The Pleasant Run Practice Park, Phase I, is complete. No additional funds are proposed for Pleasant Run Practice Park, Phase II. The proposed EDCIP plan includes funding for the installments for the purchase of the Pleasant Run Practice Park. Funding for this purchase is allocated through FY2004, as per the City's agreement with GCISD. The construction of the Cotton belt Trail, Phase III, from John McCain Road (north) to the Grapevine city limits and the Little Bear Creek Trail Extension from the Nature Center to Sparger Park are planned for future grant funding. The proposed EDCIP Plan proposes $393,000 in FY2004 for trail grant opportunities. Conclusion With limited funds and multiple projects, the recommended five-year plan does not provide sufficient resources for every project identified as a priority of the Parks and Recreation Advisory Board or the City Council. It does provide funds for McPherson Park, Phase I and the installment for the purchase of Pleasant Run Practice Park and leaves open the possibility of additional funds if the sales tax receipts exceed projections. Recommendation Staff recommends that the CEDe Board approve the five-year plan, as proposed. Attachments · Citizen Priorities based on Comprehensive Parks, Recreation and Open Space Master Plan · Parks and Recreation Advisory Board Prioritization, August 7,2003 MEMORANDUM TO: Dianne McWethy, Deputy City Manager FROM: Monica Sue Walsh, Parks and Recreation Manager DATE: August 7,2003 SUBJECT: Parks and Recreation Board CIP priorities At the Parks and Recreation Board meeting on August 4, 2003 the board prioritized the following CIP projects: PRIORITY LIST One being the most important Recreation Center McPherson Park Phase 1 Park Land Purchase Sneed Pro e Cottonbelt Trail Phase 3 Pleasant Run Park Phase 2 Little Bear Creek Trail Extension Senior Center McPherson Park Phase 2 ADA 1m rovements McPherson Park Phase 3 Lon wood Trail Park Maintenance Buildin Bransford Park Phase 2 McPherson Park Phase 4 Ad'acent Hike and Bike Trails Uniform Park Si na e New Tennis Courts Herita e Middle School Football Li hts ......., c Q) E Q) > o So.. 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CU ta 'ti; CU 'tS CU 1-1 Co w~.cenc.ccu.c b....D.mtaD.cuD.<C:t CUta~_....~c~co a:D.,D.Ila,U),<CU . . . . . . . . . -0 pfNMIIIlt 1n\D " aocn pf COLLEYVILLE ECONOMIC DEVELOPMENT COPRORATlON ECONOMIC DEVELOPMENT CAPITAL IMPROVEMENT PROGRAM FY 2003 - FY 2007 EXHIBIT 1 FISCAL YEAR PROJECTED 2002 2003 2004 2005 2006 2007 BEGINNING FUND BALANCE $910.875 $961,253 $273,907 $274,698 $199,403 $182.014 PROJECTED 1/2 CENT SALES TAX REVENUE $797,500 $788,227 $819.756 $852,546 $886.848 $922,114 INTEREST INCOME $57,631 $53,838 $8,217 $8,241 $5,982 $5,460 USE OF FUND BALANCE $190,938 $928,626 $0 $0 $0 $0 REMAINING FY 97 BOND PROCEEDS' $122.915 $300.000 $0 $0 $0 $0 TOTAL REVENUES $1,168,984 $2,070,690 $827.973 $860,787 $892.630 $927,574 OPERATING: ADMINISTRATIVE $7,400 $7,400 $7,400 $7,400 $7.400 $7,400 1997 DEBT SERVICE & 1.4 TIMES COVERAGE $677,018 $668.093 $666.044 $665.606 $666.306 $666,306 2000 DEBT SERVICE & 1.4 TIMES COVERAGE $163,667 $176,267 $174,517 $179,549 $177,360 $175.174 CAPITAL: BRANSFORD PARK RESTORATION $32.167 $207,893 $0 $0 $0 $0 LIBRARY STARTUP' $0 $500,000 $0 $0 $0 $0 MC PHERSON LAND PARK PLAN $0 $0 $125,000 $0 $0 $0 PARK PARK LAND PURCHASE $0 $0 $0 $325,000 $300,000 $300.000 PLEASANT RUN PARK $185,972 $19,993 $0 $0 $0 $0 SCHOOUSOCCER FIELD PARK LAND NOTE $101,640 $98,010 $94,380 $0 $0 $0 TRAILS GRANT MATCH $0 $393.000 $0 $0 $0 $0 TOTAL EXPENDITURES $1,167.863 $2,070.656 $1,067,341 $1.177.555 $1.151.067 $1.148.880 EXCESS REVENUES OVER EXPENDITURES $1,121 $34 ($239,369) ($316,768) ($258,437) ($221.306) ADD BACK.4 TIMES BOND COVERAGE RATIO $240,196 $241,246 $240.160 $241,473 $241,048 $240,423 ENDING FUND BALANCE $961.253 $273,907 $274,698 $199,403 $182,014 $201,131 ASSUMPTIONS: 4% ANNUAL SALES TAX INCREASE (FOR FY 2005 - 2007 GROWTH WILL BE MONITORED DUE TO COLLEYVILLE BLVD,CONSTRUCTION) . THE REMAINING 1997 BOND PROCEEDS ($422,915) ARE ALLOCATED TO LIBRARY START-UP ($300,000 - FY 2003). AND PLEASANT RUN PARK ($122.915 - FY 2002) COLLEYVILLE ECONOMIC DEVELOPMENT COPRORATION ECONOMIC DEVELOPMENT CAPITAL IMPROVEMENT PROGRAM FY 2004 - FY 2008 EXHIBIT 2 FISCAL YEAR PROJECTED 2003 2004 2005 2006 2007 2008 BEGINNING FUND BALANCE $961.253 $596,567 $563.934 $385,311 $305,728 $285,475 PROJECTED 112 CENT SALES TAX REVENUE $717.286 $785.000 $816,400 $849.058 $883.018 $918.339 INTEREST INCOME $53.838 $8.948 $8,459 $5.780 $4.586 $4.282 USE OF FUND BALANCE $605.932 $272,793 $0 $0 $0 $0 REMAINING FY 97 BOND PROCEEDS' $300,000 $0 $0 $0 $0 $0 TOTAL REVENUES $1.677,056 $1.066.741 $824,859 $854.836 $887.604 $922.621 OPERATING: ADMINISTRATIVE $6,800 $6.800 $6.800 $6.800 $6.800 $6,800 1997 DEBT SERVICE & 1.4 TIMES COVERAGE $668,093 $666.044 $665.606 $666.306 $666,306 $666.306 2000 DEBT SERVICE & 1.4 TIMES COVERAGE $176,267 $174,517 $179,549 $177,360 $175,174 $179.767 CAPITAL: BRANSFORD PARK RESTORATION $207.893 $0 $0 $0 $0 $0 LIBRARY STARTUp. $500.000 $0 $0 $0 $0 $0 MC PHERSON LAND PARK PLAN $0 $125,000 $0 $0 $0 $0 PARK LAND PURCHASE $0 $0 $0 $325,000 $300.000 $300.000 PLEASANT RUN PARK $19,993 $0 $0 $0 $0 $0 SCHOOUSOCCER FIELD PARK LAND NOTE $98,010 $94.380 $0 $0 $0 $0 TRAILS GRANT MATCH $0 $0 $393,000 $0 $0 $0 TOTAL EXPENDITURES $1.677.056 $1.066,741 $1.244,955 $1,175,467 $1.148.280 $1,152.873 EXCESS REVENUES OVER EXPENDITURES $0 $0 ($420,096) ($320,631) ($260.676) ($230,252) ADD BACK.4 TIMES BOND COVERAGE RATIO $241,246 $240.160 $241,473 $241,048 $240,423 $241.735 ENDING FUND BALANCE $596.567 $563,934 $385,311 $305,728 $285,475 $296,958 ASSUMPTIONS: 4% ANNUAL SALES TAX INCREASE (FOR FY 2005 - 2008 GROWTH WILL BE MONITORED DUE TO COLLEYVILLE BLVD,CONSTRUCTION) . THE REMAINING 1997 BOND PROCEEDS ($300.000) ARE ALLOCATED TO LIBRARY START-UP ($300,000 - FY 2003) RESOLUTION R-03-56 A RESOLUTION ADOPTING THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION CAPITAL IMPROVEMENT PLAN WHEREAS, the by-laws of the Colleyville Economic Development Corporation require that an Economic Development Capital Improvement Plan be developed setting forth long and short term goals that address the needs of the City within the financial constraints of revenues available to the Corporation; and WHEREAS, the Board of Directors has developed and approved an Economic Development Capital Improvement Plan. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION: Sec 1. THAT the Economic Development Capital Improvement Plan of the Colleyville Economic Development Corporation (Exhibit A) is hereby adopted. Sec. 2. THAT this Resolution shall become effective on the date of passage. AND IT IS SO RESOLVED. PASSED AND ADOPTED, this September 9, 2003. COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton Secretary COLLEYVILLE ECONOMIC DEVELOPMENT COPRORA TION ECONOMIC DEVELOPMENT CAPITAL IMPROVEMENT PROGRAM FY 2004 - FY 2008 EXHIBIT A FISCAL YEAR PROJECTED 2003 2004 2005 2006 2007 2008 BEGINNING FUND BALANCE $961,253 $596.567 $563.934 $385.311 $305,728 $285,475 PROJECTED 112 CENT SALES TAX REVENUE $717,286 $785.000 $816,400 $849.056 $883.018 $918.339 INTEREST INCOME $53,838 $8,948 $8,459 $5.780 $4.586 $4,282 USE OF FUND BALANCE $605,932 $272,793 $0 $0 $0 $0 REMAINING FY 97 BOND PROCEEDS. $300,000 $0 $0 $0 $0 $0 TOTAL REVENUES $1.677,056 $1.066,741 $824,859 $854,836 $887,604 $922,621 OPERATING' ADMINISTRATIVE $6.800 $6.800 $6,800 $6,800 $6,800 $6,800 1997 DEBT SERVICE & 1.4 TIMES COVERAGE $668.093 $666.044 $665,606 $666.306 $666,306 $666,306 2000 DEBT SERVICE & 1.4 TIMES COVERAGE $176,267 $174,517 $179,549 $177.360 $175,174 $179,767 CAPITAL: BRANSFORD PARK RESTORATION $207,893 $0 $0 $0 $0 $0 LIBRARY STARTUP' $500,000 $0 $0 $0 $0 $0 MC PHERSON LAND PARK PLAN $0 $125,000 $0 $0 $0 $0 PARK LAND PURCHASE $0 $0 $0 $325,000 $300.000 $300.000 PLEASANT RUN PARK $19,993 $0 $0 $0 $0 $0 SCHOOUSOCCER FIELD PARK LAND NOTE $98,010 $94.380 $0 $0 $0 $0 TRAILS GRANT MATCH $0 $0 $393,000 $0 $0 $0 TOTAL EXPENDITURES $1,677,056 $1,066.741 $1.244,955 $1,175,467 $1,148,280 $1,152,873 EXCESS REVENUES OVER EXPENDITURES $0 $0 ($420,096) ($320,631) ($260,676) ($230,252) ADD BACK.4 TIMES BOND COVERAGE RATIO $241,246 $240,160 $241,473 $241,048 $240,423 $241,735 ENDING FUND BALANCE $596,567 $563.934 $385,311 $305,728 $285,475 $296,958 ASSUMPTIONS: 4% ANNUAL SALES TAX INCREASE (FOR FY 2005 - 2008 GROWTH WILL BE MONITORED DUE TO COLLEYVILLE BLVD.CONSTRUCTION) . THE REMAINING 1997 BOND PROCEEDS ($300.000) ARE ALLOCATED TO LIBRARY START-UP ($300,000 - FY 2003) CEDC c;lr Of CCeW@ AGENDA BRIEFING iex,,$ MEETING DATE: ITEM # : i RESOLUTION # : 09/09/03 4 R-03-57 GENERAL MANAGER ! ! , DEPARTMENT HEAD I FINANCE MANAGER Previous Action: None DEPARTMENT: FINANCE SUBJECT: A Resolution adopting the Fiscal Year 2004 Budget Reading and Public Hearing Per the Corporate By-laws, the Board of Directors must adopt an annual budget for the Colleyville Economic Development Corporation. Attached is a proposed budget with estimated revenues and expenditures for Fiscal Year 2004 (Exhibits 1 A - 1 C). The revenue estimate is 1/2 of the sales tax revenue estimate in the City's proposed FY 2004 budget. Expenditures include McPherson Land Park Plan ($125,000), the fifth year note payment on land for soccer fields ($94,380), debt service on the 1997 and 2000 sales tax bonds ($600,401) and $6,800 for office supplies, board expenses, insurance, and arbitrage rebate services. Financial Impact Adoption of the budget will provide appropriations for the FY 2004 budget. Recommendation Approval Attachments · CEDC Budget Exhibits 1 A, 1 B, 1 C · Resolution R-03-57 COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION EXHIBIT 1A FY 2004 PROPOSED BUDGET SUMMARY FY 2003 FY 2004 ANTICIPATED PROPOSED BEGINNING FUND BALANCE $ 961,253 596,567 REVENUES, SALES TAX REVENUES $ 717 ,266 785,000 INTEREST INCOME $ 53,838 8.948 USE OF BOND PROCEEDS $ 300,000 0 USE OF FUND BALANCE $ 605,932 272,793 TOTAL REVENUES $ 1.677.056 1,066.741 LESS EXPENSES: ADMINISTRATIVE EXPENSES $ 6,800 6,800 DEBT SERVICE $ 603,114 600.401 CAPITAL PROJECTS: BRANSFORD PARK RESTORATION $ 207,893 0 LIBRARY STARTUP $ 500,000 0 MC PHERSON LAND PARK PLAN $ 0 125,000 PLEASANT RUN PARK $ 19,993 0 SCHOOUSOCCER FIELD PARK LAND NOTE $ 98.010 94.380 TOTAL EXPENSES $ 1,435,810 826,581 EXCESS REVENUES OVER EXPENSES 241,246 240.160 NOTE: A COVERAGE RATIO OF 1,4 IS REQUIRED TO MEET THE SALES TAX BOND COVENANTS, FOR FY 2004 REVENUES MUST EXCEED EXPENDITURES BY AT LEAST $240,160, COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION FY 2004 BUDGET EXHIBIT 1B PROPOSED FY 2004 $ 595,966 REVENUES: SALES TAX REVENUES $ 785.000 INTEREST INCOME $ 8.939 USE OF FUND BALANCE $ 272,802 TOTAL REVENUES $ 1,066.741 LESS EXPENSES: ADMINISTRATIVE EXPENSES $ 6.800 DEBT SERVICE $ 600,401 CAPITAL PROJECTS: MC PHERSON PARK LAND PLAN $ 125.000 SCHOOUSOCCER FIELD PARK LAND NOTE $ 94.380 TOTAL EXPENSES 826,581 EXCESS REVENUES OVER EXPENSES 240,160 NOTE A COVERAGE RATIO OF 1,4 IS REQUIRED TO MEET THE SALES TAX BOND COVENANTS, FOR FY 2004 REVENUES MUST EXCEED EXPENDITURES BY AT LEAST $240,160, COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION FISCAL YEAR 2004 BUDGET ADMINISTRATIVE EXPENSE ACCOUNT NUMBER 6203 6226 6233 6293 6301 6308 EXPENSE ACCOUNT AMOUNT BUDGETED INSURANCE $2,100 MISC CONTRACTUAL (ARBITRAGE) $4,000 BANK SERVICE CHARGES $500 BOARD AND COMMISSION $100 OFFICE SUPPLIES PRINTING TOTAL EXPENSES $6,800 EXHIBIT 1C $50 $50 RESOLUTION R-03-57 A RESOLUTION ADOPTING AN ANNUAL BUDGET FOR FISCAL YEAR 2004 FOR THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION WHEREAS, the by-laws of the Colleyville Economic Development Corporation require that an annual budget be adopted by the Board of Directors; and WHEREAS, the by-laws require that the budget includes projected revenues and proposed expenditures. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION: Sec 1. THAT the Fiscal Year 2004 budget amounts for the Colleyville Economic Development Corporation are as follows: Revenues $1,066,741 $ 826,581 Expenditures AND IT IS SO RESOLVED. PASSED AND ADOPTED, this September 9, 2003. COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton Secretary Cil)" "I ~ CEDC CC~~n~ AGENDA BRIEFING Tt'.'I:i\$ MEETING DATE: I 09/09/03 GENERAL MANAGER I ITEM # : I 5 DEPARTMENT HEAD I REPORT: I R-03-58 FINANCE MANAGER ! Previous Action: None DEPARTMENT: CITY MANAGER'S OFFICE SUBJECT: Approving the amendment of the Bylaws of the Colleyville Economic Development Corporation The CEDe Bylaws require that annually the Board prepare and adopt a proposed budget of expected revenues and proposed expenditures for each fiscal year. The fiscal year of the corporation shall commence on October 1 sl of each year and end on September 30. The budget shall be considered adopted upon formal approval by the City Council. (See attached). As per the CEDC Bylaws, Section 3. Meeting of the Directors, the annual meeting of the Board shall be on the second Tuesday in September of each year, at 6:45 p.m. The Board shall hold regular and special meetings, in the corporate limits of the City, at such place of places as the Board may from time to time determine, and in conformance with the Texas Open Meetings Act. (See attached). The conduct of the annual meeting of the Board on the second Tuesday in September of each year does not provide for the adoption of the CEDC annual budget prior to October 1, 2003; therefore, the CEDC Bylaws have been amended to change the annual meeting of the Board to the fourth Tuesday in August of each year. This proposed change will provide for the adoption of the CEDe annual budget prior to October 1. Upon approval, the CEDC Bylaws will be presented to the City Council for ratification. Financiallmoact None Recommendation Approval Attachments . Excerpts of the CEDC Bylaws . Resolution R-03-58 The Board shall be accountable to the City Council for all activities undertaken by it or on its behalf, and shall report on all activities of the Board, whether discharged directly by the Board or by any person, firm, corporation, agency, association or other entity on behalf of the Board. SECTION 5. COMPONENTS OF THE EDCIP. The Board shall submit to the City Council for its approval, the EDCIP which shall identify the projects to be undertaken by the Corporation and include proposed methods and the expected costs of implementation, and cost of operations and maintenance of the projects. SECTION 6. ANNUAL CORPORATE BUDGET. "* Annually, the Board shall prepare and adopt a proposed budget of expected revenues and proposed expenditures for each fiscal year. The fiscal year of the corooration shall commence on October 1st of each year and end on Seotember ~ The budget proposed for adoption shall include the projected operating expenses, and such other budgetary information as shall be required by the City Council for its approval and adoption. The budget shall be considered adopted upon formal approval by the City Council. SECTION 7. FINANCIAL BOOKS. RECORDS. AUDITS. The Finance Manager shall keep and properly maintain, in accordance with generally accepted accounting principles, complete financial books, records, accounts, and financial statements pertaining to its corporate funds, activities, and affairs. The City shall cause the Corporation's financial books, records, accounts, and financial statements to be audited at least once each fiscal year by an outside, independent, auditing and accounting firm selected by the City Council. Such audit shall be at the expense of the Corporation. SECTION 8. DEBT. DEPOSIT AND INVESTMENT OF CORPORATE FUNDS. All proceeds from the issuance of bonds, notes or other debt instruments (the "Bonds") issued by the Corporation shall be deposited and invested as provided in the resolution, order, indenture, or other documents authorizing or relating to their execution or issuance, but no bonds shall be issued, inClUding refunding bonds, by the Corporation without the approval of the City Council of the City. 0352~26 -9- ~ 0352426 Any director may resign at any time. Such resignation shall be made in writing, addressed to the Mayor and the City Secretary, and shall take effect at the time specified therein, or if no time is specified, at the time of its receipt by the City Secretary. SECTION 3. MEETINGS OF DIRECTORS. For meetings of the Board or committees. notice thereof shall be provided and set forth in accordance with the Texas Open Meetings Act, Chapter 551 of the Texas Local Government Code. Any member of the Board, officers of the Corporation or Mayor, may have an item placed on the agenda by delivering the same in writing to the Secretary of the Board no less than three (3) calendar days prior to the date of the Board meeting. Each agenda of a Board meeting shall contain an item, titled "Citizens Forum", to allow public comment to be made by the general public concerning Board related matters. However, no official or formal action or vote may be taken on any comment made by citizens during Citizens Forum. The annual meeting of the Board shall be on the second Tuesday in September of each year, at 6:45 p.m. The Board shall hold regular and special meetings, in the corporate limits of the City, at such place or places as the Board may from time to time determine, and in conformance with the Texas Open Meetings Act. SECTION 4. QUORUM. A quorum is a majority of the Board (being not less than four (4) members), and shall be present for the conduct of the official business of the Corporation. The act of four (4) or more directors at a meeting at which a quorum is in attendance shall constitute the act of the Board and of the Corporation, unless the act of a greater number is required by these Bylaws, policies/procedures of the Board, City Council resolution/ordinance, or state law. SECTION 5. CONDUCT OF BUSINESS. A. At the meetings of the Board, matters pertaining to the business of the Corporation shall be considered in accordance with the rules of procedure as from time to time prescribed by the Board. Unless otherwise adopted by the Board, the rules of procedures of the City Council shall be the rules of proced ures for the Board. ' B. At all meetings of the Board, the President shall preside, and in the absence of the President, the Vice President shall exercise the powers of the President. -3- RESOLUTION R-03-58 A RESOLUTION APPROVING THE AMENDMENT OF THE BYLAWS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION WHEREAS, the by-laws of the Colleyville Economic Development Corporation require that an annual budget be adopted by the Board of Directors; and WHEREAS, the Colleyville Economic Development Budget shall be adopted by formal approval of the City Council; and WHEREAS, the fiscal year of the corporation shall begin on October 1 of each year and end on September 30; and WHEREAS, the annual meeting date of the second Tuesday in September does not provide for the adoption of the budget by October 1 by the City Council. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION: Sec 1. THAT the Bylaws of the Colleyville Economic Development Corporation, hereby are attached as Exhibit "A", are amended to establish the annual meeting date of the CEDC Board on the fourth Tuesday in August of each year. AND IT IS SO RESOLVED. PASSED AND ADOPTED, this September 9, 2003. COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton Secretary EXHIBIT "A" BYLAWS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION ARTICLE I. PURPOSE AND POWERS SECTION 1. REGISTERED OFFICE AND REGISTERED AGENT The COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION (the "Corporation") shall have and continuously maintain in the State of Texas a registered office, and a registered agent whose office is identical with such registered office, as required by the Texas Non-Profit Corporation Act., and state law. The Registered Agent for the Corporation shall be the City Secretary, subject that the Board of Directors (the "Board") from time to time, may change the registered agent and/or the address of the registered office, subject to City Council approval, provided that such change is appropriately reflected in these Bylaws and in the Articles of Incorporation (the "Articles"). The registered office of the Corporation is located at 5400 Bransford Road, Colleyville, Tarrant County, Texas 76034, and at such address is the Corporation, whose mailing address is P.O. Box 185,Colleyville,Texas 76034-0185. Said address shall also serve as the principal office of the Corporation and Board. SECTION 2. PURPOSE The Corporation is incorporated as a non-profit corporation for the purposes set forth in the Articles the same to be accomplished on behalf of the City of Colleyville, Texas (the "City") as its duly constituted authority and instrumentality in accordance with the Texas Development Corporation Act of 1979, Article 5190.6, Section 4B Tex. Rev. Civ. Stat. Ann., as amended, (the "Act"), other applicable laws, and by Resolution R-96-1238 adopted by the City Council of the City on the third day of September, 1996, including all permissible projects prescribed by the Act, and for maintenance and operating costs of the publicly owned and operated projects. The Corporation shall be a non-profit corporation as defined by the Internal Revenue Code 1986, as amended, and the applicable regulations of the United States Treasury Department and the rulings of the Internal Revenue Service of the United States prescribed and promulgated thereunder. -1- SECTION 3. POWERS In the fulfillment of its corporate purpose, the Corporation shall be governed by the Act, and shall have all of the powers set forth and conferred in Section 4B of the Act, and in other applicable laws, subject to the limitations prescribed therein and herein and to the provisions thereof and hereof. ARTICLE II. BOARD OF DIRECTORS SECTION 1. NUMBER AND TERM OF OFFICE A. The property and affairs of the Corporation shall be managed and controlled by a Board and, subject to the restrictions imposed by law, by the Articles and these Bylaws, the Board shall exercise all of the powers of the Corporation. B. The Board shall consist of seven (7) directors, each of whom shall be appointed by the City Council. Each of the directors shall be a resident of the City. C. Four (4) members of the first Board shall serve terms of one (1) year and three (3) members shall serve terms of two (2) years. The respective terms of the initial directors shall be determined by the City Council. Thereafter, each successive member of the Board shall be appointed and serve for two (2) years or until a successor is appointed as hereinafter provided. Three (3) directors shall be persons who are not employees, officers of the City or members of the City Council. D. Any director may be removed from office by the City Council at will. A vacancy of any director's position which occurs by reason of death, resignation, disqualification, removal, or otherwise, shall be filled by the City Council. SECTION 2. VACANCIES AND RESIGNATIONS A vacancy in any position of director which occurs by reason of death, resignation, disqualification, removal, or otherwise, shall be filled as prescribed in Article II, Section 1. A vacancy in the office of President or Vice President which occurs by reason of death, resignation, disqualification, removal, or otherwise, shall be filled by election by the Board, from the remaining directors, for the unexpired portion of the term of that office. -2- Any director may resign at any time. Such resignation shall be made in writing, addressed to the Mayor and the City Secretary, and shall take effect at the time specified therein, or if no time is specified, at the time of its receipt by the City Secretary. SECTION 3. MEETINGS OF DIRECTORS For meetings of the Board or committees, notice thereof shall be provided and set forth in accordance with the Texas Open Meetings Act, Chapter 551 of the Texas Local Government Code. Any member of the Board, officers of the Corporation or Mayor, may have an item placed on the agenda by delivering the same in writing to the Secretary of the Board no less than three (3) calendar days prior to the date of the Board meeting. Each agenda of a Board meeting shall contain an item, titled "Citizens Forum", to allow public comment to be made by the general public concerning Board related matters. However, no official or formal action or vote may be taken on any comment made by citizens during Citizens Forum. The annual meeting of the Board shall be on the fourth Tuesday in August of each year, at 6:45 p.m. The Board shall hold regular and special meetings, in the corporate limits of the City, at such place or places as the Board may from time to time determine, and in conformance with the Texas Open Meetings Act. SECTION 4. QUORUM A quorum is a majority of the Board (being not less than four (4) members), and shall be present for the conduct of the official business of the Corporation. The act of four (4) or more directors at a meeting at which a quorum is in attendance shall constitute the act of the Board and of the Corporation, unless the act of a greater number is required by these Bylaws, policies/procedures ofthe Board, City Council resolution/ordinance, or state law. SECTION 5. CONDUCT OF BUSINESS A. At the meetings of the Board, matters pertaining to the business of the Corporation shall be considered in accordance with the rules of procedure as from time to time prescribed by the Board. Unless otherwise adopted by the Board, the rules of procedures of the City Council shall be the rules of procedures for the Board. B. At all meetings of the Board, the President shall preside, and in the absence of the President, the Vice President shall exercise the powers of the President. -3- C. The Secretary of the Corporation shall act as Secretary of all meetings of the Corporation, but in the absence of the Secretary, the presiding officer may appoint any person to act as Secretary of the meeting. The Secretary shall keep minutes of the transactions of the Board and committee meetings and shall cause such official minutes to be recorded in books kept for that purpose in the principal office of the Corporation. SECTION 6. COMMITTEES OF THE BOARD An official committee of the Board shall consist of two (2) or more directors. It is provided, however, that all final official actions of the Corporation may be exercised only by the Board. Each committee so designated shall keep regular minutes ofthe transactions of its meetings and shall cause such minutes to be recorded in books kept for that purpose in the principal office of the Corporation. SECTION 7. COMPENSATION OF DIRECTORS The directors, including the President and Vice President, shall not receive any salary or compensation for their services. However, directors may be reimbursed for their actual expenses incurred in the performance of their duties hereunder, including but not limited to the cost of travel, lodging and incidental expenses reasonably related to the corporate duties of the Board. Travel expenses incurred by directors for both regular and special meetings are not eligible for reimbursement. ARTICLE III. OFFICERS SECTION 1. TITLES AND TERM OF OFFICE The President and Vice President shall be elected by the Board and shall serve a term of one (1) year. The President and Vice President shall continue to serve until their successors are appointed as provided in Article II, Section 1. SECTION 2. POWERS AND DUTIES OF THE PRESIDENT The President shall be the chief executive officer of the Corporation, and shall preside at all meetings of the Board, and absent any different designation by a majority of the Board, shall sign and execute all contracts, conveyances, franchises, bonds, deeds, assignments, mortgages, and notes in the name of the Corporation. In addition the President shall: -4- A. call both regular and special meetings of the Board and establish the agenda for such; B. shall endorse and countersign, on behalf of the Corporation, for collection or issuance, checks, notes and other obligations in or drawn upon such bank or banks or depositories as shall be designated by the City Council consistent with these Bylaws. C. have the authority to appoint standing or study committees to aid and assist the Board in its business undertaking or other matters incidental to the operation and functions of the Board; D. perform all duties incident to the office, and such other duties as shall be prescribed from time to time by the Board, subject to approval by the City Council; E. appear before the City Council on a periodic basis to give a report on the status of activities of the Corporation; and F. appear before the City Council, or be represented by his designee, regarding any item being considered by the City Council concerning the Corporation. SECTION 3. VICE PRESIDENT The Vice President shall exercise the powers of the President during that officer's absence or inability to act. The Vice President shall also perform other duties as from time to time may be assigned by the President or the Board. SECTION 4. ATTENDANCE Directors must be present in order to vote at any meeting. Regular attendance at the Board meetings is required of all directors. The following number of absences shall constitute the basis for replacement of a director. Three (3) consecutive unexcused absences from meetings of the Board shall cause the position to be considered vacant. In addition, the position of any director who has four (4) unexcused absences in a twelve (12) month period shall also be considered vacant. -5- SECTION 5. CONFLICT OF INTEREST In the event that a director is aware that he has a conflict of interest or potential conflict of interest, with regard to any particular matter or vote coming before the Board, the director shall bring the same to the attention of the Board and shall abstain from discussion and voting thereof. Any director shall bring to the attention of the Board any apparent conflict of interest or potential conflict of interest of any other director in which case the Board shall determine whether a true conflict of interest exists before any further discussion or vote shall be conducted regarding that particular matter. The director about whom a conflict of interest question has been raised shall refrain from voting with regard to the determination as to whether a true conflict exists. Failure to conform to these requirements herein and policies as may be adopted by the Board is cause for dismissal from the Board by action of the City Council. SECTION 6. IMPLIED DUTIES The Corporation is authorized to do that which the Board deems desirable, subject to City Council approval, to accomplish any of the purposes or duties set out or alluded to in the Articles, these Bylaws, and in accordance with State law. SECTION 7. BOARD'S RELATIONSHIP WITH THE CITY In accordance with state law, the Board shall be responsible for the proper discharge of its duties assigned herein. The Board shall determine its policies and directives within the limitations of the duties herein imposed by applicable laws, the Articles, these Bylaws, contracts entered into with the City, and budget and fiduciary responsibilities. Any request for services made to the departments of the City shall be made by the Board or its designee in writing to the City Manager. The City Manager may approve such request for assistance from the Board when he finds such requested services are available within the City and that the Board has agreed to reimburse the City for the cost of such services so provided, as provided in Article III, Section 8 of these Bylaws. SECTION 8. CONTRACTS FOR SERVICE The Corporation may, with approval of the City Council, contract with any qualified and appropriate person, association, corporation or governmental entity to perform and discharge designated tasks which will aid or assist the Board in the performance of its duties. However, no such contract shall ever be approved or entered into which seeks or attempts to divest the Board of its discretion and policy- making functions in discharging the duties herein set forth. An administrative -6- services contract shall be executed between the Board and the City Council for the services provided by the General Manager, Finance Manager, Secretary, and other City services/functions and compensated as provided for herein. Subject to the authority of the City Manager under the Charter of the City, the Corporation shall have the right to utilize the services of the staff and employees of the Finance Department of the City, the staff and employees of the Parks and Recreation Department and other employees of the City, provided (i) that the City Manager approves of the utilization of such services, (ii) that the Corporation shall pay, as approved by the City Manager, reasonable compensation to the City of such services, and (iii) the performance of such services does not materially interfere with the other duties of such personnel of the City. Utilization of tile aforesaid city staff shall be solely by a contract approved by the City Council. ARTICLE IV. FUNCTIONAL CORPORATE DUTIES AND REQUIREMENTS SECTION 1. GENERAL MANAGER The General Manager shall be the chief administrative officer of the Corporation and be in general charge of the properties and affairs of the Corporation, shall administer all work orders, requisitions for payment, purchase orders, contract administration/oversight, and other instruments or activities as prescribed by the Board in the name of the Corporation. The General Manager shall be an employee of the City. SECTION 2. FINANCE MANAGER The Finance Manager shall have the responsibility to see to the handling, custody, and security of all funds and securities of the Corporation. When necessary or proper, the Finance Manager shall endorse and sign, on behalf of the Corporation, for collection or issuance, checks, notes and other obligations drawn upon such bank or banks or depositories as shall be designated by the City Council consistent with these Bylaws. The Finance Manager shall see to the entry in the books of the Corporation of full and accurate accounts of all monies received and paid out on account of the Corporation. The Finance Manager shall, at the expense of the Corporation, give such bond for the faithful discharge of the duties in such form and amount as the City Council shall require, by resolution. The Finance Manager shall be an employee of the City. The Finance Manager shall provide financial reports to the Board and to the City Council concerning activities of the Corporation in a format consistent with other financial reports of the City and on a periodic basis as shall be directed by the Board or the City Council. -7- SECTION 3. SECRETARY The Secretary shall keep the minutes of all meetings of the Board and committees in books provided for that purpose, shall give and serve all notices, shall sign with the President in the name of the Corporation, and/or attest the signature thereto, all contracts, conveyances, franchises, bonds, deeds, assignments, mortgages, notes and other instruments ofthe Corporation, shall have charge of the corporate books, records, documents and instruments except the books of account and financial records and securities, and such other books and papers as the Board may direct, all of which shall at all reasonable times be open to public inspection upon application at the office of the Corporation during business hours, and shall in general perform all duties incident to the office of Secretary subject to the control of the Board. The Secretary shall be an employee of the City. SECTION 4. DUTIES OF THE BOARD The Board shall develop a combined Economic Development Capital Improvement Program, ("the EDCIP"), including maintenance and operation costs thereof, forthe City which shall include and set forth short and long term goals. Such plan shall be approved by the City Council. The EDCIP developed by the Board shall be one that addresses development needs of the City within the financial constraints of revenues available to the Corporation. The Board shall conduct a public hearing concerning both the adoption and required annual updates to the EDCIP. A legal notice shall be advertised as determined by the Board, at least three (3) days, prior to the scheduled public hearing. The Board shall review and update the EDCIP once a year to ensure the plan is up to date with current community needs and is capable of meeting community development needs of the City and consistent with the Act. The Board shall expend, in accordance with State law and subject to City Council approval, the funds received by it for projects defined in the Act where such expenditures will have a benefit to the residents of the City. The Board shall make an annual report to the City Council including, but not limited to the following: A. A review of the accomplishments of the Corporation for the preceding year; and B. The activities of the Corporation for the budget year addressed in the annual report. The required annual report shall be made to the City Council no later than February 1 st of each year. -8- The Board shall be accountable to the City Council for all activities undertaken by it or on its behalf, and shall report on all activities of the Board, whether discharged directly by the Board or by any person, firm, corporation, agency, association or other entity on behalf of the Board. SECTION 5. COMPONENTS OF THE EDCIP The Board shall submit to the City Council for its approval, the EDCIP which shall identify the projects to be undertaken by the Corporation and include proposed methods and the expected costs of implementation, and cost of operations and maintenance of the projects. SECTION 6. ANNUAL CORPORATE BUDGET Annually, the Board shall prepare and adopt a proposed budget of expected revenues and proposed expenditures for each fiscal year. The fiscal year of the corporation shall commence on October 1 st of each year and end on September 30. The budget proposed for adoption shall include the projected operating expenses, and such other budgetary information as shall be required by the City Council for its approval and adoption. The budget shall be considered adopted upon formal approval by the City Council. SECTION 7. FINANCIAL BOOKS, RECORDS. AUDITS The Finance Manager shall keep and properly maintain, in accordance with generally accepted accounting principles, complete financial books, records, accounts, and financial statements pertaining to its corporate funds, activities, and affairs. The City shall cause the Corporation's financial books, records, accounts, and financial statements to be audited at least once each fiscal year by an outside, independent, auditing and accounting firm selected by the City Council. Such audit shall be at the expense of the Corporation. SECTION 8. DEBT, DEPOSIT AND INVESTMENT OF CORPORATE FUNDS All proceeds from the issuance of bonds, notes or other debt instruments (the "Bonds") issued by the Corporation shall be deposited and invested as provided in the resolution, order, indenture, or other documents authorizing or relating to their execution or issuance, but no bonds shall be issued, including refunding bonds, by the Corporation without the approval of the City Council of the City. -9- All monies of the Corporation shall be deposited, secured, and/or invested in the manner provided for the deposit, security, and/or investment of the public funds of the City and in accordance with investment policies adopted by the City. The Finance Manager shall designate the accounts and depositories to be created and designated for such purposes, and the methods of withdrawal offunds therefrom for use by and for the purposes of the Corporation upon the signature of the Finance Manager and the Secretary. The accounts, reconciliation, and investment of such funds and accounts shall be performed by the Finance Director. SECTION 9. EXPENDITURES OF CORPORATE MONEY The monies of the Corporation, including sales and use taxes collected pursuant to the Act, the proceeds from the investment offunds of the Corporation, the proceeds from the sale of property, monies derived from the repayment of loans, rents received from the lease or use of property, the proceeds derived from the sale of bonds, and other proceeds may be expended by the Corporation for any of the purposes authorized by the Act, subject to the following limitations: A. Expenditures from the proceeds of bonds shall be identified and described in the orders, resolutions, indentures, or other agreements submitted to and approved by the City Council. B. Expenditures that may be made from a fund created from the proceeds of bonds, and expenditures of monies derived from sources other than the proceeds of bonds may be used for the purposes of financing or otherwise providing one or more projects, as defined in the Act. C. All other proposed expenditures shall be made in accordance with and shall be set forth in the annual budget required by these Bylaws or in contracts meeting the requirements of the Article. No bonds, including refunding bonds, shall be authorized or sold and delivered by the Corporation without the approval of the City Council. SECTION 10. CONTRACTS As provided herein, the President and Secretary shall enter into any contracts or other instruments which the Board has approved and authorized in the name and on behalf of the Corporation. Such authority may be confined to specific instances or defined in general terms. When appropriate, the Board may grant a specific or general power of attorney to carry out some action on behalf of the Board, provided, however that no such power of attorney may be granted unless an appropriate resolution of the Board authorizes the same to be done. -10- ARTICLE V. MISCELLANEOUS PROVISIONS SECTION 1. SEAL The Board may obtain a corporate seal which shall bear the words "Corporate Seal of the Colleyville Economic Development Corporation" and the Board may thereafter use the corporate seal and corporate name; but these Bylaws shall not be construed to require the use of the corporate seal. SECTION 2. APPROVAL OR ADVICE AND CONSENT OF THE CITY COUNCIL To the extent that these bylaws refer to any action, approval, advice, or consent by the City or refer to action, approval, advice or consent by the City Council, such action, approval, advice or consent shall be evidenced by a motion, resolution or ordinance duly passed by the City Council and reflected in the minutes of the City Council. SECTION 3. INDEMNIFICATION OF DIRECTORS. OFFICERS AND EMPLOYEES As provided in the Act and in the Articles of Incorporation, the Corporation is, for the purposes of the Texas Tort Claims Act (Subchapter A, Chapter 101, Texas Civil Practices and Remedies Code), a governmental unit and its actions are governmental functions. The Corporation shall indemnify each and every member of the Board, its officers and its employees, and each member of the City Council and each employee ofthe City, to the fullest extent permitted by law against any and all liability or expense, including attorneys fees, incurred by any of such persons by reason of any actions or omissions that may arise out of the functions and activities of the Corporation. This indemnity shall apply even if one or more of those to be indemnified was negligent or caused or contributed to cause any loss, claim, action or suit. Specifically, it is the intent of these Bylaws and the Corporation to require the Corporation to indemnify those named for indemnification, even for the consequences of the negligence of those to be indemnified which caused or contributed to cause any liability. The Corporation must purchase and maintain insurance on behalf of any director, officer, employee, or agent of the Corporation, or on behalf of any person serving at the request of the Corporation as a Board member, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against any liability asserted against that person and incurred by that person in any such -11- capacity or arising out of any such status with regard to the Corporation, whether or not the Corporation has the power to indemnify that person against liability for any of those acts. SECTION 4. GIFTS The Board may accept on behalf of the Corporation any contribution, gift, bequest, or device for the general purpose or for any special purposes of the Corporation. SECTION 5. CODE OF ETHICS Each director, including the President and Vice President, its officers, employees, and agents shall abide by and be subject to the City's code of ethics. The code of ethics shall be applicable to independent contractors of the Corporation, except to the extent that such independent contractor is not performing work on behalf of the Corporation. SECTION 6. AMENDMENTS TO BYLAWS These Bylaws may be amended or repealed and new Bylaws may be adopted by an affirmative vote of four (4) of the authorized directors serving on the Board, subject to approval by the City Council. The City Council may amend these Bylaws at any time. Such amendments by the City Council will be duly passed and adopted by motion, resolution or ordinance duly reflected in the minutes of the City Council and, thereafter, duly noted to the Board. SECTION 7. DISSOLUTION OF THE CORPORATION Upon dissolution ofthe Corporation, titles to or other interest in any real or personal property owned by the Corporation at such time shall vest in the City of Colleyville. SECTION 8. APPLICABILITY OF CITY CHARTER POLICIES AND PROCEDURES The City Charter and all duly approved city policies and procedures shall apply directly to the Corporation and the Board unless such charters, policies or procedures are superseded by state law or not related to the functions of the Board. The Board has the prerogative, subject to approval by the City Council, to adopt other policies and procedures in addition to or in place of those of the City. -12- SECTION 9. EFFECTIVE DATE These Bylaws, having been approved by Resolution R-96-1238, adopted on the third day of September, 1996, shall become effective upon the approval of such by the Board. -13- CEDC CC~a!~lll'" AGENDA BRIEFING (l:'xid MEETING DATE: 09/09/03 GENERAL MANAGER ITEM # : I 6 DEPARTMENT HEAD ; I RESOLUTION # : I R-03-59 FINANCE MANAGER ; Previous Action: None DEPARTMENT: FINANCE SUBJECT: Revising the Colleyville Economic Development Corporation Investment Policy Reading and Public Hearing Annually, staff reviews the Corporation's investment policy and recommends updates or revisions to the policy, based upon legislative and/or accounting pronouncement changes, or policy improvements recommended by Government Treasurer's Organization of Texas and the Municipal Treasurers Association of the United States and Canada (MT A US&C). On the basis that the MT A US&C now offers an investment policy certification program, additions to the Corporation's current policy are needed to comply with the standards set forth by this association. Additionally, to better meet the provisions of Governmental Accounting Standards Board (GASB) pronouncement 40 "Deposit and Investment Risk Disclosures" (effective for Fiscal Year 2005 financial statements) a few changes to the investment policy are proposed. All proposed new wording in the attached investment policy is underlined. The justification for the proposed changes by section is as follows: Policy: Requirement of MT A US&C. Objectives: Additional language and format suggested by MT A U8&C. Prudence: Additional language suggested by MT A US&C. Permissible Instruments: Local government investment pool (e.) Provides clarification per GASB 40. (f.) Additional language suggested by MTA US&C. Unacceptable Investment Instruments: Reverse repurchase agreements - Provides clarification per GASB 40. Investment Procedures: Additional language suggested by MT A US&C. Glossary: Required section by MTA US&C. Agenda Briefing Resolution R-03-59 Page 2 A section in the Public Funds Investment Act requires that an entity's governing body review the investment strategy of the entity annually. The Corporation's investment strategy is contained in the section entitled "Investment Strategy" and is presented for the Board's review. Financiallmoact None Recommendation Approval Attachment · CEDC Investment Policy · Resolution R-03-59 COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION INVESTMENT POLICY Policv It is the policv of the Collevville Economic Development Corporation (the Corporation) to invest public funds in a manner which will provide the hiQhest investment return with the maximum security while meetinq the dailv cash flow demands of the entity and conforminq to all State of Texas statutes and City of Collevville ordinances. Scope This investment policy applies to all financial assets of the Corporation including: General Fund Debt Service Fund Capital Projects Fund and any new fund created by the governing body, unless specifically exempted by the governing body. Objectives The primary obiectives. in priority order. of the Corporation's investment activities shall be: Safety: Safety of principal is the foremost objective of the Corporation in managing its portfolio. Investments of the Corporation shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective the Corporation will diversify its investments by investing funds among a variety of securities offering independent returns and financial institutions. LiQuiditv: The Corporation will also maintain sufficient liquidity to provide adequate and timely working funds. Return on Investments: The investment portfolio shall be desiQned with the obiective of obtaininQ a rate of return throuQhout budQetary and economic cvcles. commensurate with the investment risk constraints and cash flow needs. The Corporation investment strateQV is passive and the portfolio shall be designed with the objective of regularly exceeding the weighted average return on thirteen-week Treasury bills. This is considered a benchmark for riskless investment transactions, and therefore, is a minimum standard for the portfolio's rate of return. For bond funds that fall under the arbitrage provisions of the Tax Reform Act of 1986, the Corporation will attempt to earn allowable bond yield with market conditions permitting. Delegation of Authority The Corporation designates the Investment Officers to be the General Manager with overall responsibilities to see that investment objectives are accomplished and the Finance Manager with the specific day-to-day performance of managing the funds of the Corporation. Ethics and Conflict of Interest All investment Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees shall disclose to the Colleyville Economic Development Corporation and Texas Ethics Commission a statement under the following conditions: A. If they have a personal business relationship with a business organization offering to engage in an investment transaction with the entity. Under the Public Funds Investment Act, a personal business relationship is defined as: 1. the investment officer owns 10 percent or more of the voting stock or shares of the business organization or owns $5,000 or more of the fair market value of the business organization: 2. funds received by the investment officer from the business organization exceed 10 percent of the investment officer's gross income for the previous year; or 3. the investment officer has acquired from the business organization during the previous year investments with a book value of $2,500 or more for the personal account of the investment officer. B. If they are related within the second degree by affinity or consanguinity, as determined by Chapter 573 VAT.C.S. to an individual seeking to sell an investment to the Corporation of Colleyville. Prudence Investments shall be made with iudqement and care - under circumstances then prevailinq _ which persons of prudence. discretion. and intelliqence exercise in the manaqement of their own affairs. not for speculation. but for investment. considerinq the probable safety of their capital as well as the probable income to be derived. The standard of prudence to be used by investment officials shall be the "prudent person" which means the officer may not be an expert but is obligated to act responsibly and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. Investment officers shall notify the Board of Directors in writing of any conflicts of interest, as defined by the Public Funds Investment Act, no later than the next regularly scheduled Board of Director's meeting. It is the policy of the Colleyville Economic Development Corporation that the Investment' Officers perform their duties in accordance with the policies and procedures set forth in this policy. The Investment Officers of the Corporation (General Manager and Finance Manager, and Assistant to the Finance Director of the City of Colleyville) shall be personally indemnified in the event of investment loss provided the Investment Policy is followed. Internal Controls The Finance Manager shall establish a system of written internal controls which shall be reviewed annually by the independent auditor. The controls shall be designed to prevent the loss of public funds due to fraud, error, misrepresentation, unanticipated market changes or imprudent actions. Permissible Instruments The following is a list of permissible instruments as authorized by the 70th Texas Legislature in the Public Funds Investment Act (TEX. REV. CIV. STAT. ANN. ACT 842A-2) and amended by the 71st Legislature: 1. obligations of the United States or its agencies or instrumentalities; 2. direct obligations of the State of Texas or its agencies; 3. other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas or the United States or its agencies or instrumentalities; 4. obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by nationally recognized investment rating firm and having received a rating of not less than "A" or its equivalent; 5. certificates of deposit issued by state and national banks and domiciled in the state that are: a. guaranteed or insured by the Federal Deposit Insurance Corporation, FSLlC or its successors; or b. secured by obligations that are described by subdivisions (1) through (4) of this subsection which are intended to include all direct federal agency or instrumentality issued mortgage backed securities, and that have a market value of not less than the principal amount of the certificates or in any other manner and amount provided by law for deposits of the investing entities; 6. invest in a local government investment pool as authorized by the Interlocal Cooperation Act (TEX. REV. CIV. STAT. ANN. ACT. 4413 (32c), as amended, and the Public Funds Investment Act (TEX. REV. CIV. STAT. ACT. 842A-2), as amended. The investment pool must comply with the requirements of the Public Funds Investment Act, as amended, as follows: a. the investment pool maintains a stable asset value as defined in the Public Funds Investment Act; b. the investment pool maintains a AAA rating by one of the nationally recognized ratings agencies; c. the investment pool's maximum average dollar weighted maturity does not exceed 90 days; and d. the investment pool's continued compliance with the remaining provisions of the Public Funds Investment Act. e. the eliQible investments of the pool are as follows: obliQations of the United States or its aqencies and instrumentalities, other obliqations, the principal of and interest on which are unconditionally quaranteed or insured by the United States, fully collateralized repurchase aqreements with a defined termination date secured by obliqations of the United States or its aqencies and instrumentalities, other obliQations, the principal of and interest on which are unconditionally Quaranteed or insured by the United States, and SEC reQistered money market funds authorized by the Public Funds Investment Act and rated in the hiQhest cateQorv by at least one nationally recoQnized ratinq aqency, reverse repurchase aqreements with a term of no 10nQer than 90 days. f. Include in its investment policy and/or operatinQ procedures the followinQ information: a description of eliqible investment securities and unacceptable investments. a written statement on investment policy and obiectives, a description of interest calculations, distribution, and treatment of Qains and losses, security safeQuardinQ, valuation collateralization and auditinQ, and a fee shcedule. 7. Direct repurchase agreements with primary security dealers or financial institutions doinQ business in the State of Texas having a defined termination date, and secured by U.S. Government or federal agency securities, provided that the ownership of collateral for the repurchase agreement is transferred to the Corporation, and deposited with a safekeeping agent for the duration of the contract and a signed master repurchase agreement has been executed with the counterparty. 8. SEC-registered no-load money market mutual funds with a dollar weighted average portfolio of 90 days or less whose assets consist exclusively of United States Government Securities whose investment objectives include seeking to maintain a stable net asset value of $1.00 per share. Investment in mutual funds shall be limited to a maximum of ten percent (10%) of the Corporations available funds. Unacceptable Investment Instruments The following securities, although authorized by the Public Funds Investment Act, are not eligible investments for the Colleyville Economic Development Corporation: 1. Collateralized mortgage obligations 2. Commercial paper 3. Banker's acceptances 4. Reverse repurchase agreements Local Government Investment Pools which the City participates in may enQaQe in reverse repurchase aqreements if the term is 90 days or less) 5. No-load mutual funds other than no-load money market mutual funds 6. Guaranteed investment contracts 7. Share certificates of qualifying credit unions Investment Strategy The investment strategy by type of fund is as follows: (1) Operating Funds The investment strategy for operating fund(s) is to assure that anticipated cash flows are matched with adequate investment liquidity. A secondary objective is to create a portfolio which will experience minimum volatility during economic cycles. These funds shall not have an investment with a stated maturity greater than eighteen (18) months. (2) Debt Service Funds The investment strategy for debt service fund(s) is the assurance of investment liquidity to cover the debt service obligations on the required payment date. Investments purchased shall not have a stated final maturity date which exceeds the corresponding debt service payment date. (3) Reserve Funds The investment strategy for reserve fund(s) is the assurance of investment liquidity adequate to cover the debt service obligations not funded by debt service funds on the required payment date. Investment of reserve funds are controlled by their ordinance, resolution or indenture, and Federal and State law. Bond documents must be examined for each issue, for potential differences with this policy concerning investment instruments, maximum maturity or average life restrictions, call dates or sinking fund redemptions, and applicable arbitrage yields and rebate liability. Provisions contained in the bond documents will supersede provisions of this policy. Reserve funds will be invested using a more conservative approach than the current standard investment strategy when arbitrage rebate rules require refunding excess earnings. All excess earnings received will be segregated to allow a proper determination of interest income to be used in the arbitrage calculation. Maturity limitations for single issue reserve funds shall not exceed the sooner of five (5) years, the call provisions of the bond ordinance, or the final maturity of the bond issue. A. Diversification The Corporation will attempt to limit the risk of loss through diversification of its portfolio and to achieve the aforementioned investment strategies by diversification of instruments. Maximum Diversification by Instrument Percent of Portfolio U.S. Treasury Obligations (Bills, Notes and Bonds) U.S. Government Agency Securities and Instrumentalities of Government Sponsored Corporations 100% 75% Certificates of Deposit (CD's) Commercial Bank's 75% Local Government Investment Pool 75% Tri-Party Repurchase Agreement 75% SEC registered, no-load mutual fund 10% Investment Procedures The Corporation shall enter the followinQ aqreements (if applicable): safekeepinq, PSA repurchase aoreements, wire transfer aQreements, bankinq services contracts, and collateral/depositorv aQreements. These contracts shall include the explicit deleQation of authority to persons responsible for the transactions involvinQ these aQreements. No person except those desionated in the contract may enQaqe in any investment transactions On all funds available for investment other than those placed with Investment Pools, oral bids shall be requested from at least two broker/dealers or national banks. The Corporation will accept the bid which provides the highest rate of return within the maturity required and within the parameters of this policy. Records will be kept of the bids offered, bids accepted, and a brief explanation of the decision which was made regarding the investment. Qualified Institutions As the Corporations investments are managed by the investment officers for the City of Colleyville, the Corporation shall utilize the broker/dealers selected by the City of Colleyville. The selection process is as follows: each year in December, the City Council shall approve five financial institutions for investment purposes as recommended by the Finance Director. All firms shall answer the BrokerlDealer questionnaire (Appendix A) and submit their most recent audited financial statements for evaluation of credit worthiness. All personnel in the firms who will be trading or quoting securities to the Corporation must maintain a current NASD license and be registered to deal securities in the State of Texas. An investment certification form (Appendix B) on the firm's letterhead signed by a principal of the firm must be on file with the Corporation. Safekeeping All marketable securities purchased by the Corporation shall be held in third party safekeeping by an institution designated as primary agent. All securities will be delivered to the third party institution by seller. Personnel in the third party institution will verify the correct security was delivered by the seller ("delivery vs payment"). The third party institution shall issue a safekeeping receipt to the Corporation listing the specific instrument, rate/yield, maturity, CUSIP, and other pertinent information. Collateral on deposit type securities which exceed the FDIC coverage shall be held in a third party safekeeping institution. In the event a third party safekeeping institution is used, a collateral agreement shall be executed between the Board of Directors, depository which pledged the collateral, and the third party custodian of the collateral. The Board of Directors will retain possession of all original safekeeping receipts and the receipts will state the security is pledged to the Colleyville Economic Development Corporation. Either the General Manager or the Finance Manager must approve release of collateral in writing prior to its removal from the safekeeping account. Collateral Securities for Certificates of Deposit and Demand Accounts The General Manager will accept as collateral for its Certificates of Deposit and demand accounts the following securities: A. FDIC coverage B. U.S. Treasury bills, notes and bonds C. United States Agency and instrumentalities bills or notes D. GNMA mortgage backed fully modified pass through securities E. Surety Bond The collateral for the demand account may combined with the collateral held by the City of Colleyville's demand account for the demand accounts held at the same institution. Collateral shall be "marked to market" monthly by the Finance Manager. The following percentages constitutes the minimum market value for collateral instruments which are pledged for the Corporation's Certificates of Deposit and demand deposits. Form of Collateral Pledoed Collateral Ratio 1. U.S. Treasury bills, notes, and bonds a. maturing within 1 year 102% b. maturing in 1-5 years 105% c. maturing in more than 5 years 110% 2. Actively traded U.S. Government Agency securities a. maturing in less than 1 year 103% b. maturing in 1-5 years 107% c. maturing in more than 5 years 115% 3. GNMA mortgage pass through securities 115% Collateral shall be audited annually be the Corporation's independent auditor and may be audited by the Corporation at anytime during normal business hours of the safekeeping bank. Arbitrage The Tax Reform Act of 1986 places limitations on the Corporation's yield from investing certain tax-exempt bond proceeds, debt service funds and reserve funds. The rebate provisions require that the Corporation compute earnings on investments from certain issues of bonds on a periodic basis to determine if rebate is required. To determine the Corporation's arbitrage position, the corporation is required to calculate the actual yield earned on the investment of the funds and compare it to the yield that would have been earned if the funds had been invested at a rate equal to the yield on the applicable bonds sold by the Corporation. The rebate provisions state that periodically ( not less than once every five years and not later than sixty days after maturity of the bonds), the Corporation is required to pay the United States Treasury a rebate of any excess earnings. These restrictions require extreme precision in the monitoring and record keeping of investments, particularly in computing yields to ensure compliance. Failure to comply can dictate that the bonds become taxable, retroactively from the date of issuance. The investment strategy for bond funds which fall under the arbitrage provisions of the Tax Reform Act of 1986, is that the Corporation will attempt to earn maximum allowable bond yield with market conditions permitting. Reporting Requirements Included as a part of the City of Colleyville's quarterly investment report, the Finance Manager shall issue a written report concerning the Corporation's investment transactions for the preceding quarter and describing in detail the investment position of the Corporation as of the end of the quarter indicating the market values of all investments held during the quarter. The report shall list for each investment held during the quarter: the purchase price of the investment, the par value of the investment, the market value of the investment at the beginning of the quarter, market value of the investment at the end of the quarter, the market change from the beginning until the end of the quarter, and fully accrued interest for the period. This report shall be in compliance with provisions of the Public Funds Investment Act, as amended. The report shall be signed by the General Manager and Finance Manager. Training Requirements Both the Finance Manager and Assistant to the Finance Director of the City of Colleyville shall complete ten hours of training every two years as required by the Public Funds Investment Act. This training may be obtained from the following sources: North Central Texas Council of Governments, Government Treasurer's Organization of Texas, Government Finance Officer's of Texas, or Texas Municipal League. The training must include education in investment controls, security risks, strategy risks, market risks, and any other topics as required by the Public Funds Investment Act. GLOSSARY AGENCIES - Federal aqency securities and/or Government-sponsored entities. BENCHMARK - A comparative base for measurinQ the performance or risk tolerance of the investment portfolio. A benchmark should represent a close correlation to the level of risk and the averaqe duration of the portfolio's investments. BROKER - A broker brinqs buyers and sellers tOQether for a commission. CERTIFICATE OF DEPOSIT - A time deposit with a specific maturity evidenced by a certificate. Laroe- denomination CD's a typically neQotiable. COLLATERAL - Securities, evidence of deposit. or other property which a borrower pledQes to secure repayment of a loan. Also refers to securities pledoed by a bank to secure deposits of public monies. DEALER - A dealer, as opposed to a broker, acts as a principal in all transactions. buvinQ and sellinQ for his own account. DELIVERY VERSUS PAYMENT - Delivery verses payment is the delivery of a security and there is an exchanoe of money after the delivery of the security. DISCOUNT SECURITIES - Non-interest bearino money market instruments that are beinq issued at a discount and redeemed at maturity for full face value, e.Q Treasury Bills. DIVERSIFICATION independent returns. Dividinq instruments amonQ securities offerinQ FEDERAL CREDIT AGENCIES - Aqencies of the Federal Qovernment set UP to supply credit to various classes of institutions and individuals e.Q.savinqs and loans, small business firms, students, farmers, farm cooperatives. and exporters. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) - A federal aqency that insures bank deposits, currently UP to $100,000 per deposit. FEDERAL HOME LOAN BANKS (FHLB) - Government sponsored reoional wholesale banks which lend funds and provide correspondent bankinQ services to member commercial banks, thrift institutions, credit unions and insurance companies. 'The mission of the FHLB is to liquefy the housinQ related assets of its members who must purchase stock in their district bank. FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - FNMA, like GNMA was chartered under the Federal National MortQaoe Association Act in 1938. It a federal corporation and the larQest sinQle provider of residential mortoaQe funds in the United States. FNMA's securities are hiQhly liquid and widely accepted. FNMA assumes and quarantees that all security holders will receive timely payment of principal and interest. GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - Securities influencinQ the volume of bank credit Quaranteed by GNMA and issued by mortqaqe bankers, commercial banks, savinQs and loan associations. Security holder is backed by the full faith and credit of the US Government. LIQUIDITY - A asset that can be converted quicklV and easily to cash. LOCAL GOVERNMENT INVESTMENT POOL - An investment by local Qovernments in which their money is pooled as a method for manaqinQ local funds. MARKET VALUE - The price at which a security is tradino and could presumable be purchased or sold. MASTER REPURCHASE AGREEMENT - A written contract coverinq all future transactions between the parties to repurchase - reverse repurchase aqreements that establishes each party's riqhts in the transactions. A master aqreement will specify, amonQ other thinQs. the rioht of the buyer-lender to liquidate the underlyino securities in the event of default bv the seller-borrower. MATURITY - The date upon which the principal or stated value of an investment becomes due and pavable. MUTUAL FUND - An investment company that pools money and can invest in a variety of securities, includinQ fixed-income securities and money market instruments. Mutual funds are reQulated bv the Investment Company Act of 1940 and must abide by Securities and Exchanae disclosure ouidelines. PORTFOLIO - Collection of securities held by an investor. PRIMARY DEALER - A Qroup of qovernment securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subiect to informal oversioht. PRUDENT PERSON RULE - An investment standard outlininQ fiduciary responsibilities of public funds investors relatinq to investment practices. RATE OF RETURN - The yield obtainable on a security based on its purchase price or its current market price. REPURCHASE AGREEMENT - An aqreement of one party to sell securities at a specified price to a second party and a simultaneous aqreement of the first party to repurchase the securities at a specified price or at a specified later date. REVERSE REPURCHASE AGREEMENT - An aQreement of one party to sell securities at a specified price to a second party and a simultaneous aQreement by the first party to resell the securities at a specified price to the second party on demand or at a specified date. SAFEKEEPING - HoldinQ of assets (e.Q. securities) bv a financial institution. TREASURY BILLS - A non-interest bearinq discount security issued by the US Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year. The yields on these bills are monitored closely for interest rate trends. TREASURY BONDS - Lonq term US qovernment debt securities with maturities of ten to thirty years. TREASURY NOTES - Intermediate term US Qovernment debt securities with maturities of one to ten years. YIELD - The current rate of return on an investment security qenerally expressed as a percentaQe of the securities current price. RESOLUTION R-03-59 AN RESOLUTION REVISING THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION INVESTMENT POLICY WHEREAS, review of the Colleyville Economic Development Corporation's investment policy necessitates the update of the policy as adopted by Resolution R-96- 04 and amended by Resolutions R-98-26 and R-00-41. NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION: Sec. 1. THAT "Exhibit A" of this resolution be adopted as the Colleyville Economic Development Corporation's Investment Policy and it replaces "Exhibit A" contained in Resolution R-00-41. Sec. 2. THAT this resolution become effective on the date of passage. AND IT IS SO RESOLVED. PASSED AND ADOPTED, this September 9, 2003. COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton, TRMC Secretary EXHIBIT" AU COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION INVESTMENT POLICY Policy It is the policy of the Colleyville Economic Development Corporation (the Corporation) to invest public funds in a manner which will provide the highest investment return with the maximum security while meeting the daily cash flow demands of the entity and conforming to all State of Texas statutes and City of Colleyville ordinances. Scope This investment policy applies to all financial assets of the Corporation including: General Fund Debt Service Fund Capital Projects Fund and any new fund created by the governing body, unless specifically exempted by the governing body. Objectives The primary objectives, in priority order, of the Corporation's investment activities shall be: Safety: Safety of principal is the foremost objective of the Corporation in managing its portfolio. Investments of the Corporation shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective the Corporation will diversify its investments by investing funds among a variety of securities offering independent returns and financial institutions. Liquidity: The Corporation will also maintain sufficient liquidity to provide adequate and timely working funds. Return on Investments: The investment portfolio shall be designed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and cash flow needs. The Corporation investment strategy is passive and the portfolio shall be designed with the objective of regularly exceeding the weighted average return on thirteen-week Treasury bills. This is considered a benchmark for riskless investment transactions, and therefore, is a minimum standard for the portfolio's rate of return. For bond funds that fall under the arbitrage provisions of the Tax Reform Act of 1986, the Corporation will attempt to earn allowable bond yield with market conditions permitting. Delegation of Authority The Corporation designates the Investment Officers to be the General Manager with overall responsibilities to see that investment objectives are accomplished and the Finance Manager with the specific day-to-day performance of managing the funds of the Corporation. Ethics and Conflict of Interest All investment Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions. Employees shall disclose to the Colleyville Economic Development Corporation and Texas Ethics Commission a statement under the following conditions: A. If they have a personal business relationship with a business organization offering to engage in an investment transaction with the entity. Under the Public Funds Investment Act, a personal business relationship is defined as: 1. the investment officer owns 10 percent or more of the voting stock or shares of the business organization or owns $5,000 or more of the fair market value of the business organization: 2. funds received by the investment officer from the business organization exceed 10 percent of the investment officer's gross income for the previous year; or 3. the investment officer has acquired from the business organization during the previous year investments with a book value of $2,500 or more for the personal account of the investment officer. B. If they are related within the second degree by affinity or consanguinity, as determined by Chapter 573 V.ATC.S. to an individual seeking to sell an investment to the Corporation of Colleyville. Prudence Investments shall be made with judgement and care - under circumstances then prevailing _ which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. The standard of prudence to be used by investment officials shall be the "prudent person" which means the officer may not be an expert but is obligated to act responsibly and shall be applied in the context of managing an overall portfolio. Investment officers acting in accordance with written procedures and exercising due diligence shall be relieved of personal responsibility for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments. Investment officers shall notify the Board of Directors in writing of any conflicts of interest, as defined by the Public Funds Investment Act, no later than the next regularly scheduled Board of Director's meeting. It is the policy of the Colleyville Economic Development Corporation that the Investment Officers perform their duties in accordance with the policies and procedures set forth in this policy. The Investment Officers of the Corporation (General Manager and Finance Manager, and Assistant to the Finance Director of the City of Colleyville) shall be personally indemnified in the event of investment loss provided the Investment Policy is followed. Internal Controls The Finance Manager shall establish a system of written internal controls which shall be reviewed annually by the independent auditor. The controls shall be designed to prevent the loss of public funds due to fraud, error, misrepresentation, unanticipated market changes or imprudent actions. Permissible Instruments The following is a list of permissible instruments as authorized by the 70th Texas Legislature in the Public Funds Investment Act (TEX. REV. CIV. STAT. ANN. ACT 842A-2) and amended by the 71 st Legislature: 1. obligations of the United States or its agencies or instrumentalities; 2. direct obligations of the State of Texas or its agencies; 3. other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the State of Texas or the United States or its agencies or instrumentalities; 4. obligations of states, agencies, counties, cities, and other political subdivisions of any state having been rated as to investment quality by nationally recognized investment rating firm and having received a rating of not less than "A" or its equivalent; 5. certificates of deposit issued by state and national banks and domiciled in the state that are: a. guaranteed or insured by the Federal Deposit Insurance Corporation, FSLlC or its successors; or b. secured by obligations that are described by subdivisions (1) through (4) of this subsection which are intended to include all direct federal agency or instrumentality issued mortgage backed securities, and that have a market value of not less than the principal amount of the certificates or in any other manner and amount provided by law for deposits of the investing entities; 6. invest in a local government investment pool as authorized by the Interlocal Cooperation Act (TEX. REV. CIV. STAT. ANN. ACT. 4413 (32c), as amended, and the Public Funds Investment Act (TEX. REV. CIV. STAT. ACT. 842A-2), as amended. The investment pool must comply with the requirements of the Public Funds Investment Act, as amended, as follows: a. the investment pool maintains a stable asset value as defined in the Public Funds Investment Act; b. the investment pool maintains a AAA rating by one of the nationally recognized ratings agencies; c. the investment pool's maximum average dollar weighted maturity does not exceed 90 days; and d. the investment pool's continued compliance with the remaining provisions of the Public Funds Investment Act. e. the eligible investments of the pool are as follows: obligations of the United States or its agencies and instrumentalities, other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the United States, fully collateralized repurchase agreements with a defined termination date secured by obligations of the United States or its agencies and instrumentalities, other obligations, the principal of and interest on which are unconditionally guaranteed or insured by the United States, and SEC registered money market funds authorized by the Public Funds Investment Act and rated in the highest category by at least one nationally recognized rating agency, reverse repurchase agreements with a term of no longer than 90 days. f. Include in its investment policy and/or operating procedures the following information: a description of eligible investment securities and unacceptable investments, a written statement on investment policy and objectives, a description of interest calculations, distribution, and treatment of gains and losses, security safeguarding, valuation collateralization and auditing, and a fee shcedule. 7. Direct repurchase agreements with primary security dealers or financial institutions doing business in the State of Texas having a defined termination date, and secured by U.S. Government or federal agency securities, provided that the ownership of collateral for the repurchase agreement is transferred to the Corporation, and deposited with a safekeeping agent for the duration of the contract and a signed master repurchase agreement has been executed with the counterparty. 8. SEC-registered no-load money market mutual funds with a dollar weighted average portfolio of 90 days or less whose assets consist exclusively of United States Government Securities whose investment objectives include seeking to maintain a stable net asset value of $1.00 per share. Investment in mutual funds shall be limited to a maximum of ten percent (10%) of the Corporations available funds. Unacceptable Investment Instruments The following securities, although authorized by the Public Funds Investment Act, are not eligible investments for the Colleyville Economic Development Corporation: 1. Collateralized mortgage obligations 2. Commercial paper 3. Banker's acceptances 4. Reverse repurchase agreements Local Government Investment Pools which the City participates in may engage in reverse repurchase agreements if the term is 90 days or less) 5. No-load mutual funds other than no-load money market mutual funds 6. Guaranteed investment contracts 7. Share certificates of qualifying credit unions Investment Strategy The investment strategy by type of fund is as follows: (1) Operating Funds The investment strategy for operating fund(s) is to assure that anticipated cash flows are matched with adequate investment liquidity. A secondary objective is to create a portfolio which will experience minimum volatility during economic cycles. These funds shall not have an investment with a stated maturity greater than eighteen (18) months. (2) Debt Service Funds The investment strategy for debt service fund(s) is the assurance of investment liquidity to cover the debt service obligations on the required payment date. Investments purchased shall not have a stated final maturity date which exceeds the corresponding debt service payment date. (3) Reserve Funds The investment strategy for reserve fund(s) is the assurance of investment liquidity adequate to cover the debt service obligations not funded by debt service funds on the required payment date. Investment of reserve funds are controlled by their ordinance, resolution or indenture, and Federal and State law. Bond documents must be examined for each issue, for potential differences with this policy concerning investment instruments, maximum maturity or average life restrictions, call dates or sinking fund redemptions, and applicable arbitrage yields and rebate liability. Provisions contained in the bond documents will supersede provisions of this policy. Reserve funds will be invested using a more conservative approach than the current standard investment strategy when arbitrage rebate rules require refunding excess earnings. All excess earnings received will be segregated to allow a proper determination of interest income to be used in the arbitrage calculation. Maturity limitations for single issue reserve funds shall not exceed the sooner of five (5) years, the call provisions of the bond ordinance, or the final maturity of the bond issue. A. Diversification The Corporation will attempt to limit the risk of loss through diversification of its portfolio and to achieve the aforementioned investment strategies by diversification of instruments. Maximum Diversification by Instrument Percent of Portfolio U.S. Treasury Obligations (Bills, Notes and Bonds) U.S. Government Agency Securities and Instrumentalities of Government Sponsored Corporations 100% 75% Certificates of Deposit (CD's) Commercial Bank's 75% Local Government Investment Pool 75% Tri-Party Repurchase Agreement 75% SEe registered, no-load mutual fund 10% Investment Procedures The Corporation shall enter the following agreements (if applicable): safekeeping, PSA repurchase agreements, wire transfer agreements, banking services contracts, and collateral/depository agreements. These contracts shall include the explicit delegation of authority to persons responsible for the transactions involving these agreements. No person except those designated in the contract may engage in any investment transactions On all funds available for investment other than those placed with Investment Pools, oral bids shall be requested from at least two broker/dealers or national banks. The Corporation will accept the bid which provides the highest rate of return within the maturity required and within the parameters of this policy. Records will be kept of the bids offered, bids accepted, and a brief explanation of the decision which was made regarding the investment. Qualified Institutions As the Corporations investments are managed by the investment officers for the City of Colleyville, the Corporation shall utilize the broker/dealers selected by the City of Colleyville. The selection process is as follows: each year in December, the City Council shall approve five financial institutions for investment purposes as recommended by the Finance Director. All firms shall answer the Broker/Dealer questionnaire (Appendix A) and submit their most recent audited financial statements for evaluation of credit worthiness. All personnel in the firms who will be trading or quoting securities to the Corporation must maintain a current NASD license and be registered to deal securities in the State of Texas. An investment certification form (Appendix B) on the firm's letterhead signed by a principal of the firm must be on file with the Corporation. Safekeeping All marketable securities purchased by the Corporation shall be held in third party safekeeping by an institution designated as primary agent. All securities will be delivered to the third party institution by seller. Personnel in the third party institution will verify the correct security was delivered by the seller ("delivery vs payment"). The third party institution shall issue a safekeeping receipt to the Corporation listing the specific instrument, rate/yield, maturity, CUSIP, and other pertinent information. Collateral on deposit type securities which exceed the FDIC coverage shall be held in a third party safekeeping institution. In the event a third party safekeeping institution is used, a collateral agreement shall be executed between the Board of Directors, depository which pledged the collateral, and the third party custodian of the collateral. The Board of Directors will retain possession of all original safekeeping receipts and the receipts will state the security is pledged to the Colleyville Economic Development Corporation. Either the General Manager or the Finance Manager must approve release of collateral in writing prior to its removal from the safekeeping account. Collateral Securities for Certificates of Deposit and Demand Accounts The General Manager will accept as collateral for its Certificates of Deposit and demand accounts the following securities: A. FDIC coverage B. U.S. Treasury bills, notes and bonds C. United States Agency and instrumentalities bills or notes D. GNMA mortgage backed fully modified pass through securities E. Surety Bond The collateral for the demand account may combined with the collateral held by the City of Colleyville's demand account for the demand accounts held at the same institution. Collateral shall be "marked to market" monthly by the Finance Manager. The following percentages constitutes the minimum market value for collateral instruments which are pledged for the Corporation's Certificates of Deposit and demand deposits. Form of Collateral Pledged Collateral Ratio 1. U.S. Treasury bills, notes, and bonds a. maturing within 1 year 102% b. maturing in 1-5 years 105% c. maturing in more than 5 years 110% 2. Actively traded U.S. Government Agency securities a. maturing in less than 1 year 103% b. maturing in 1-5 years 107% c. maturing in more than 5 years 115% 3. GNMA mortgage pass through securities 115% Collateral shall be audited annually be the Corporation's independent auditor and may be audited by the Corporation at anytime during normal business hours of the safekeeping bank. Arbitrage The Tax Reform Act of 1986 places limitations on the Corporation's yield from investing certain tax-exempt bond proceeds, debt service funds and reserve funds. The rebate provisions require that the Corporation compute earnings on investments from certain issues of bonds on a periodic basis to determine if rebate is required. To determine the Corporation's arbitrage position, the corporation is required to calculate the actual yield earned on the investment of the funds and compare it to the yield that would have been earned if the funds had been invested at a rate equal to the yield on the applicable bonds sold by the Corporation. The rebate provisions state that periodically ( not less than once every five years and not later than sixty days after maturity of the bonds), the Corporation is required to pay the United States Treasury a rebate of any excess earnings. These restrictions require extreme precision in the monitoring and record keeping of investments, particularly in computing yields to ensure compliance. Failure to comply can dictate that the bonds become taxable, retroactively from the date of issuance. The investment strategy for bond funds which fall under the arbitrage provisions of the Tax Reform Act of 1986, is that the Corporation will attempt to earn maximum allowable bond yield with market conditions permitting. Reporting Requirements Included as a part of the City of Colleyville's quarterly investment report, the Finance Manager shall issue a written report concerning the Corporation's investment transactions for the preceding quarter and describing in detail the investment position of the Corporation as of the end of the quarter indicating the market values of all investments held during the quarter. The report shall list for each investment held during the quarter: the purchase price of the investment, the par value of the investment, the market value of the investment at the beginning of the quarter, market value of the investment at the end of the quarter, the market change from the beginning until the end of the quarter, and fully accrued interest for the period. This report shall be in compliance with provisions of the Public Funds Investment Act, as amended. The report shall be signed by the General Manager and Finance Manager. Training Requirements Both the Finance Manager and Assistant to the Finance Director of the City of Colleyville shall complete ten hours of training every two years as required by the Public Funds Investment Act. This training may be obtained from the following sources: North Central Texas Council of Governments, Government Treasurer's Organization of Texas, Government Finance Officer's of Texas, or Texas Municipal League. The training must include education in investment controls, security risks, strategy risks, market risks, and any other topics as required by the Public Funds Investment Act. GLOSSARY AGENCIES - Federal agency securities and/or Government-sponsored entities. BENCHMARK - A comparative base for measuring the performance or risk tolerance of the investment portfolio. A benchmark should represent a close correlation to the level of risk and the average duration of the portfolio's investments. BROKER - A broker brings buyers and sellers together for a commission. CERTIFICATE OF DEPOSIT - A time deposit with a specific maturity evidenced by a certificate. Large- denomination CD's a typically negotiable. COLLATERAL - Securities, evidence of deposit, or other property which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies. DEALER - A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account. DELIVERY VERSUS PAYMENT - Delivery verses payment is the delivery of a security and there is an exchange of money after the delivery of the security. DISCOUNT SECURITIES - Non-interest bearing money market instruments that are being issued at a discount and redeemed at maturity for full face value, e.g Treasury Bills. DIVERSIFICATION independent returns. Dividing instruments among securities offering FEDERAL CREDIT AGENCIES - Agencies of the Federal government set up to supply credit to various classes of institutions and individuals e.g.saYings and loans, small business firms, students, farmers, farm cooperatives, and exporters. FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC) - A federal agency that insures bank deposits, currently up to $100,000 per deposit. FEDERAL HOME LOAN BANKS (FHLB) - Government sponsored regional wholesale banks which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. 'The mission of the FHLB is to liquefy the housing related assets of its members who must purchase stock in their district bank. FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA) - FNMA, like GNMA was chartered under the Federal National Mortgage Association Act in 1938. It a federal corporation and the largest single provider of residential mortgage funds in the United States. FNMA's securities are highly liquid and widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest. GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA) - Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations. Security holder is backed by the full faith and credit of the US Government. LIQUIDITY - A asset that can be converted quickly and easily to cash. LOCAL GOVERNMENT INVESTMENT POOL - An investment by local governments in which their money is pooled as a method for managing local funds. MARKET VALUE - The price at which a security is trading and could presumable be purchased or sold. MASTER REPURCHASE AGREEMENT - A written contract covering all future transactions between the parties to repurchase - reverse repurchase agreements that establishes each party's rights in the transactions. A master agreement will specify, among other things, the right of the buyer-lender to liquidate the underlying securities in the event of default by the seller-borrower. MATURITY - The date upon which the principal or stated value of an investment becomes due and payable. MUTUAL FUND - An investment company that pools money and can invest in a variety of securities, including fixed-income securities and money market instruments. Mutual funds are regulated by the Investment Company Act of 1940 and must abide by Securities and Exchange disclosure guidelines. PORTFOLIO - Collection of securities held by an investor. PRIMARY DEALER - A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to informal oversight. PRUDENT PERSON RULE - An investment standard outlining fiduciary responsibilities of public funds investors relating to investment practices. RATE OF RETURN - The yield obtainable on a security based on its purchase price or its current market price. REPURCHASE AGREEMENT - An agreement of one party to sell securities at a specified price to a second party and a simultaneous agreement of the first party to repurchase the securities at a specified price or at a specified later date. REVERSE REPURCHASE AGREEMENT - An agreement of one party to sell securities at a specified price to a second party and a simultaneous agreement by the first party to resell the securities at a specified price to the second party on demand or at a specified date. SAFEKEEPING - Holding of assets (e.g. securities) by a financial institution. TREASURY BILLS - A non-interest bearing discount security issued by the US Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year. The yields on these bills are monitored closely for interest rate trends. TREASURY BONDS - Long term US government debt securities with maturities of ten to thirty years. TREASURY NOTES - Intermediate term US government debt securities with maturities of one to ten years. YIELD - The current rate of return on an investment security generally expressed as a percentage of the securities current price. CEDC <Deil," 'Tl'X;:'I$ AGENDA BRIEFING ITEM # : I REPORT: i 09/09/03 7 I GENERAL MANAGER I , , DEPARTMENT HEAD I FINANCE MANAGER I Previous Action: None MEETING DATE: ! , DEPARTMENT: FINANCE SUBJECT: Annual Activity Report The CEDC Bylaws require that the Board make an annual report by February 1 to the City Council "reviewing the accomplishments of the Corporation for the preceding year and the activities of the Corporation for the budget year". Attached is the Annual Activity Report that will be submitted to the City Council on September 16, 2003. Financial Impact None Recommendation Approval Attachments · Annual Report of The Colleyville Economic Development Corporation ANNUAL REPORT OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION ACTIONS OF THE CORPORATION On September 10, 2002, the Board held its annual meeting and approved the FY 03 annual budget for the Corporation with projected revenues of $2,070,657 and expenses of $1,828,197. The Board also adopted the attached Economic Development Capital Improvement Plan (EDCIP) for fiscal years 2003 through 2007. This plan provides funding for Bransford Park restoration, City entrance markers, Library start-up, McPherson park plan, park land purchase, Pleasant Run Park, school/soccer field park land note, and Sparger Park/Nature Center trail. CEDC cae" AGENDA BRIEFING IL''''';:l ~ DEPARTMENT HEAD MEETING DATE: ITEM # : REPORT: 09/09/03 8 GENERAL MANAGER FINANCE MANAGER Previous Action: None DEPARTMENT: FINANCE SUBJECT: Annual Investment Report From the period of October 1, 2002 through August 31, 2003, the CEDC had an average $2,555,677 invested in Local Government Investment Cooperative (LOGIC) pool, and it earned $31,474 for this period. The Corporation also holds a Treasury note purchased August 31, 2001, with a par value of $1,185,000 maturing February 28, 2003 and it earned $16,935 from the period. The maturity proceeds were re-invested in a Treasury Bill with a purchase price of $1,211,952 and a par value of $1,219,000 yielding 1.173%. The Treasury bill matured on August 31,2003, and as of June 30, 2003, its market value was $1,217,476. RESOLUTION R-03-60 A RESOLUTION RATIFYING CORPORATE BOARD ACTION UNDER BUSINESS FOR THE MEETING OF THE BOARD OF DIRECTORS OF THE COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION SEPTEMBER 9,2003 WHEREAS, the Board of Directors has taken action on certain items on the agenda under Business. NOW, THEREFORE, BE IT RESOLVED BY THE COLLEYVILLE ECONOMIC DEVELOPMENT BOARD OF DIRECTORS OF THE CITY OF COLLEYVILLE, TEXAS: Sec. 1. THAT the agenda decisions approved by the Board of Directors of the Colleyville Economic Development Corporation under Business this date and not otherwise adopted by separate Resolution, as follows are hereby adopted. THAT AND IT IS SO RESOLVED. PASSED AND ADOPTED, THIS DAY OF 2003. CITY OF COLLEYVILLE ECONOMIC DEVELOPMENT CORPORATION President ATTEST: Cynthia Singleton Secretary