To: the Board of Directors of Lake Dunlap Water Control and Improvement District, Texas, and to All Other Interested Persons

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To: the Board of Directors of Lake Dunlap Water Control and Improvement District, Texas, and to All Other Interested Persons TO: THE BOARD OF DIRECTORS OF LAKE DUNLAP WATER CONTROL AND IMPROVEMENT DISTRICT, TEXAS, AND TO ALL OTHER INTERESTED PERSONS: Notice is hereby given that the Board of Directors of Lake Dunlap Water Control and Improvement District will hold a special meeting on February 16, 2021 at 5:00 p.m. In accordance with the Governor’s emergency proclamation suspending certain provisions of the Texas Open Meetings Act effective March 16, 2020 in response to the COVID-19 virus, individual members of the Board of Directors of the District will participate in the meeting remotely. All members of the Board and public may participate in the meeting telephonically or by weblink using the instructions below. Weblink Instructions: Members of the public may join the meeting through the following web link: https://global.gotomeeting.com/join/152051477 Telephonic Instructions: Members of the public may join the meeting telephonically by dialing the following telephone number: +1 (872) 240-3212 When your call is answered and when prompted, enter in the following Meeting ID below followed by the pound sign (#): 152-051-477 # Meeting Topics: The meeting will be held for the following purposes: 1. Receive Public Comments. 2. Consider and take action regarding approval of the minutes from the January 19, 2021 Board of Directors’ meetings. 3. Discussion relating to implementation and contents of the internet website for Lake Dunlap Water Control and Improvement District. 4. Consider and take action relating to proposal by Heartwood Development Company II, LLC for: (i) creation of defined area for reimbursement of proposed residential development infrastructure costs; or (ii) release of property from corporate boundaries of the District. 5. Consider and take action relating to Funding and Construction of Improvements to the Lake Dunlap Dam Facilities: a. Status of award of contract by Guadalupe-Blanco River Authority for construction of Improvements to the Lake Dunlap Dam Facilities including related litigation; and b. Other matters related thereto. 6. Consider and take action regarding Approval of the Bookkeepers Report and Payment of Bills and Invoices. 1 _________________________________ The Board of Directors may go into Executive Session if necessary, pursuant to the applicable section of Subchapter D, Chapter 551, Texas Government Code, of the Texas Open Meetings Act, on any of the above matters. No final action, decision or vote will be taken on any subject or matter in Executive Session. The District is committed to compliance with the Americans with Disabilities Act. Reasonable modifications and equal access to communications will be provided upon request. Please call 512-328-2008 for further information. 2 MINUTES OF THE MEETING OF THE BOARD OF DIRECTORS OF LAKE DUNLAP WATER CONTROL AND IMPROVEMENT DISTRICT Tuesday, January 19, 2021 STATE OF TEXAS § § COUNTIES OF GUADALUPE AND COMAL § The Board of Directors of Lake Dunlap Water Control and Improvement District (the “District”) conducted a special meeting, open to the public, on Tuesday, January 19, 2021 at 4:00 p.m. Notices of the time, place and the subject of the meeting, and the actions to be taken at the meeting, were posted at the places and for the time required by the laws of the State of Texas. In accordance with the Governor’s emergency proclamation suspending certain provisions of the Texas Open Meetings Act effective March 16, 2020 in response to the COVID-19 pandemic, the meeting was conducted remotely. All persons, including members of the public, could participate in the meeting by telephone or weblink in accordance with the instructions set forth on the meeting agenda. The roll was called of the directors of the Board, to-wit: Douglas Harrison- President J Raymond Harmon- Vice President Laurence Johnson- Secretary Vernon Gary Schaub- Treasurer Harry Alvin Moeller- Assistant Secretary and all of said persons were present, thus constituting a quorum. Also present was Anthony Corbett of McLean Howard, LLP (District legal counsel). The following residents were present at the meeting: Garry Barr, Scott Wakefield, Leo York and Terry Zimmerman. Director Harrison called the meeting to order at 4:00 p.m. 1. The first item of business was receipt of public comment. Mr. York addressed the Board and asked it to increase the level of communications to the public regarding the District and its activities. The Board responded that it was in the process of establishing an internet website to provide more information to the public, and that the meeting agenda included an item to create a Communications Committee to facilitate public communications. 2. The Board then considered approval of the meeting minutes from the December 15, 2020 and December 31, 2020 meetings of the Board of Directors. After discussion, Director Schaub moved that the Board approve the minutes as presented, subject to changing the word 1 “bods” to “bids” in the December 31, 2020 minutes. Director Harmon seconded the motion, which carried unanimously (5-0). 3. The Board then considered the establishment of an internet website for the District. Director Harrison presented a proposal and contract by Maxwebs to establish a website. He noted that the contractor was very familiar with water districts and the information required to be posted on a district’s website. The Board then discussed whether to retain the contractor, or to utilize a website created by Director Johnson in order to lower costs. After subsequent discussion, Director Harrison moved that the Board approve a contract with Maxwebs for creation of an internet website for the District. Director Harmon seconded the motion, which carried unanimously (5-0). The Board requested that Director Harrison ask whether Maxwebs could use any of the work product prepared by Director Johnson in order to lower the District’s costs. A copy of the Maxwebs Proposal and Contract are attached to these meeting minutes. 4. The Board then discussed matters relating to public communications. The Board first considered a Resolution Establishing a Communications Committee. After discussion, Director Harrison moved that the Board adopt the Resolution, and designate Directors Harrison and Schaub to be the initial members of the Communications Committee. Director Harmon seconded the motion, which carried 4-0-1, with Director Johnson abstaining. The Board then discussed the content of initial communications by the Committee to the public. The Board concurred that the Communications Committee should communicate actions accomplished by the District during its initial 100 days, and information relating to the Lake Dunlap Dam Project. The Board also concurred that individual directors may provide proposed information to the Communications Committee for potential communication to the public. 5. The Board then considered matters relating to the funding and construction of improvements to the Lake Dunlap Dam. Director Moeller reported that GBRA had been sued by the low bidder after GBRA announced its intention to award the contract to Zachary Construction (the second low bidder). The Board discussed the matter but took no action. 6. Allen Douthitt presented the Bookkeepers Report to the Board of Directors. After discussion, Director Johnson moved that the Board approve the Bookkeepers Report and the payment of bills and invoices as presented. Director Moeller seconded the motion, which carried unanimously (5-0). 7. By unanimous acclamation, the Board adjourned the meeting at 5:04 p.m. [The remainder of this page intentionally left blank.] 2 _______________________________ Secretary, Board of Directors (SEAL) 3 Matt Kutac LAW OFFICE OF MATTHEW B. KUTAC 512.615.0503 a Professional Limited Liability Company [email protected] MAILING ADDRESS: 3321 Bee Caves Road, Suite 203 Austin, TX 78746 February 5, 2021 Via Email Mr. Tony Corbett, McLean & Howard, LLP Barton Oaks Plaza, Building II 901 South MoPac Expy., Ste 225 Austin, Texas 78746 Email: [email protected] Re: Heartwood Development Proposal Dear Tony: I write on behalf of my client, Heartwood Development Company II, LLC (“Heartwood”), with a proposal for your client, Lake Dunlap Water Control and Improvement District (the “District”). Heartwood has entered into a contract for the purchase of approximately 177 acres of real property shown on the enclosed Attachment A (the “Heartwood Tract”). The southwestern boundary of the Heartwood Tract is adjacent to Lake Dunlap, and approximately 150 acres of the tract are included within the District. Heartwood intends to develop the Heartwood Tract as a residential community and is interested in supporting the efforts of the District in a manner that is also beneficial to its development and residents thereof. To that end, Heartwood would like to propose an agreement to be drafted as outlined in this letter that could provide for an additional revenue source for the District (the “Initial Agreement”). Under the Initial Agreement, the District would: (1) allow for addition of the remainder of the Heartwood Tract to the District; (2) establish a defined area comprised of the Heartwood Tract; (3) agree to the form a reimbursement agreement to be executed at a later date (“Reimbursement Agreement”) providing for reimbursement of certain water, wastewater and drainage improvements necessary to serve the development within Heartwood Tract (“Subdivision Improvements”); and (4) agree to call and conduct a bond election authorizing the District’s reimbursement for the Subdivision Improvements. The Initial Agreement would also provide for Heartwood’s funding of a portion of the District’s existing obligations under its agreement with the Guadalupe Blanco River Authority (the “GBRA Agreement”) using any reimbursement proceeds received by Heartwood through reimbursement for the Subdivision Improvements. More specifically, the proposed Reimbursement Agreement would provide for reimbursement by the District of Heartwood’s costs related to design and construction of the Subdivision Improvements, using proceeds of bonds issued by the District. Importantly, the bonds issued by the District would be funded by ad valorem taxes levied only upon property within the Heartwood Tract (the “Heartwood Tract Defined Area”).
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