MONTGOMERY COUNTY MUNICIPAL UTILITY DISTRICT NO. 8

MINUTES OF REGULAR MEETING

July 19, 2024

The Board of Directors (the “Board” or “Directors”) of Montgomery County Municipal Utility District No. 8 (the “District” or “MUD 8”) met in regular session, open to the public, on Friday, July 19, 2024, at 9:00 a.m., at the Walden Yacht Club, 13101 Melville Drive, Montgomery, Texas 77356, a designated meeting place located inside the boundaries of the District, and the roll was called of the duly constituted officers and members of the Board, to wit:

John Tryon President
John L. Patton Vice President
Margie Barlow Secretary
Randolph C. Moravec Treasurer/Investment Officer
Michael White Assistant Secretary

All members of the Board were present, except Director Barlow, thus constituting a quorum. Also attending were Mark Miller of Municipal Accounts & Consulting L.P. (“Bookkeeper” or “MAC”); Conner Murphy and Justin Abshire (via telephone) of Quiddity Engineering (“Engineer” or “Quiddity”); John David Wright of Hays Utility North Corporation (“Operator” or “Hays North”); Elliot M. Barner, attorney, of Radcliffe Adams Barner PLLC (“Attorney” or “RAB”); Robert Ginandt, Director of Montgomery County Municipal Utility District No. 9 (“MUD 9”); and Rusty Denner, General Manager for the Walden Community Improvement Association (“WCIA”).

The President, after finding that the notice of the meeting was posted as required by law and determining that a quorum of the Board was present, called the meeting to order and declared it open for such business as may come before it.

PUBLIC COMMENT

The President first opened the meeting to public comment.

Ms. Jina Shabacy and Mr. Donald Cloud introduced themselves to the Board and expressed their frustration with the new segment of security fencing that is being installed around the perimeter of the Browning Street Water Treatment Plant (the “WTP”) site (the “Fencing”).

Ms. Shabacy went on to explain that such segment is directly adjacent to their rear property lines. Ms. Shabacy then went on to explain her interaction with the Fencing contractor and stated that such contractors entered her property without notifying her beforehand. Ms. Shabacy and

Mr. Cloud also explained that the razor wire being placed on top of such fencing is angled outward and is imposing on not only their back yards, but also that of others adjacent to the perimeter of the Browning Street WTP.

Director Moravec stated that he understood that property owners adjacent to the WTP site were going to be provided notice before such Fencing was installed by the Operator, who is overseeing the Fencing construction. A brief discussion regarding such project ensued in order to clarify Ms. Shabacy and Mr. Cloud’s comments. The Board stated that it would review such project, discuss it with the Operator and Attorney, and schedule a time to discuss the matter with them further.

There being no further public comments, the President directed the Board to proceed with the agenda.

APPROVAL OF MINUTES OF JUNE 12, 2024 REGULAR MEETING

Director Tryon directed the Board to the approval of the June 12, 2024 regular meeting minutes. Upon a motion by Director Patton, seconded by Director Moravec, after full discussion and with all Directors present voting aye, the Board approved the June 12, 2024 regular meeting minutes, as presented.

TAX ASSESSOR-COLLECTOR’S REPORT

Mr. Miller then reviewed the Tax Assessor-Collector’s Report for the month of June 2024, a copy of which is attached hereto, including past monthly collections and credits as reported by the Tax Assessor-Collector for the District. Mr. Miller reported that 98.28% of the 2023 taxes have been collected as of June 30, 2024.

Upon a motion by Director Patton, seconded by Director Moravec, after full discussion and with all Directors present voting aye, the Board approved the Tax Assessor-Collector’s Report, as presented.

BOOKKEEPER’S REPORT

Mr. Miller next reviewed the Bookkeeper’s Report, a copy of which is attached hereto, including the current fund balances, expenditures, and investments.

Upon a motion by Director Moravec, seconded by Director White, after full discussion and with all Directors present voting aye, the Board: 1) approved the Bookkeeper’s Report, as presented; and 2) authorized payment of checks detailed therein.

ENGINEER’S REPORT

Mr. Murphy then presented the Engineer’s Report, a copy of which is attached hereto.

Mr. Murphy reminded the Board that the Wastewater Treatment Plant (“WWTP”) Improvement Project was substantially complete as of February 20, 2024.

Mr. Murphy further reminded the Board that such project was completed 834 days later than the completion date stated in the construction contract for such project. Mr. Murphy reported that RAB sent a letter to Allco, LLC (“Allco”) regarding the liquidated damages owed to the District under such contract. Messrs.

Murphy and Barner then went on to provide an update to the Board regarding the outcome of their recent meeting with Allco regarding such damages and options to resolve the total amount owed to Allco.

Next, Mr. Murphy reminded the Board that the Texas Commission on Environmental Quality (the “TCEQ”) requires that WWTPs with a permitted flow of at least 1.0 million gallons per day obtain a multi-sector general permit, which includes the development of a stormwater pollution prevention plan (“SW3P”). Mr.

Murphy reported that Quiddity finalized the prevention plan and has provided a copy to the Board. Mr. Murphy further stated that Quiddity will coordinate with the Board President to submit a Notice of Intent to the TCEQ this month.

Mr. Murphy then reminded the Board that the Stormwater Outfall Cleaning and Televising Project, Phase I, will be delayed due to the elevated water level in Lake Conroe.

Mr. Abshire stated that Quiddity will investigate if the outfalls can be inspected once the water level decreases to 200 feet.

Mr. Murphy next reported that Quiddity has almost completed the design of the Lift Station Rehabilitation Project, the scope of which is focused on Lift Station No 5-7; however, they cannot finalize design until an easement is obtained on the tract of land adjacent to the District’s property where Lift Station No. 6 is located. Mr. Murphy reminded the Board that Lift Station No. 6 on Walden Estates Drive was constructed on a very small tract of land owned by the District, which sits between a home and a vacant lot. Mr. Murphy then reported that pursuant to prior authorization from the Board, Quiddity and RAB are coordinating with Camillo Companies (“Camillo”) regarding obtaining a ten foot (10′) to fifteen foot (15′) sanitary sewer easement on the vacant tract of land adjacent along the south side of the District’s property.

Mr. Murphy further reported that once Camillo consents to the dimensions of such easement, Quiddity will prepare the metes and bounds description and RAB will prepare the easement agreement. Mr. Barner added that he has reached out to Camillo for an update on their review of the area required for the easement and will follow up with them for a response.

Mr. Murphy then reminded the Board that the District has received conditional approval from the TCEQ to use double-wall chemical storage tanks at WTP No. 2; however, the TCEQ is requiring the District to submit engineering plans and specifications for approval. Mr. Murphy provided a copy of a scope memo for Quiddity to obtain TCEQ approval for the phosphate system at WTP No. 2, estimating a cost of $16,000. Extensive discussion ensued regarding the estimated cost. In response to a question from Director Patton, Mr. Abshire explained that the estimate contemplated design of such tank, but since such tank is prefabricated, it will actually be around half of the estimate.

Next, Mr. Murphy informed the Board that Quiddity has evaluated the existing WTP No. 2 facilities and plan to present options for a ground storage tank replacement.

Next, Director Patton explained that he and Quiddity have been reviewing options for generators at the Catahoula Well, including various options for such generators, according to size and functionality.

Upon a motion by Director Patton, seconded by Director Tryon, after full discussion and with all Directors present voting aye, the Board: 1) approved the Engineer’s Report, as presented; 2) authorized Quiddity to proceed with the WTP No. 2 Phosphate System, as presented; and
3) authorized Quiddity to prepare a proposal regarding options for generators.

OPERATOR’S REPORT

Mr. Wright next presented the Operator’s Report, a copy of which is attached hereto.

Mr. Wright then reported that 735 customers are receiving electronic billing statements, which is an increase of seven (7) customers from last month.

Mr. Wright next reported that the combined water accountability for the District and
MUD 9 was 96.93%.

Mr. Wright then reported that there were four (4) new tap last month and that the District has a total of 1,834 connections. Mr. Wright further reported that two (2) accounts were terminated last month due to delinquent payment.

Next, Mr. Wright reported that no customers requested adjustments to their water bills due to leaks that occurred on their property.

In response to a question from Director Moravec, Mr. Wright confirmed that Hays North has been improving the use of the belt press at the WWTP.

Director Patton then requested that Mr. Wright have the generator at the WWTP repaired as soon as possible.

Mr. Wright then reported on the Lead Service Line Inventory required by the Environmental Protection Agency’s (“EPA”) rules regarding lead and copper content in plumbing fixtures.

Mr. Wright then discussed the stormwater drainage on Thoreau Drive.

Upon a motion by Director Patton, seconded by Director White, after full discussion and with all Directors present voting aye, the Board approved the Operator’s Report.

STATUS OF WATER SMART PROGRAM APPLICATION, INCLUDING RESOLUTON APPROVING SUBMITTAL OF WATER SMART APPLICATION FOR INCLUSION IN ASSOCIATION OF WATER BOARD DIRECTORS (“AWBD”) WATER SMART PARTNERS PROGRAM (“WATER SMART RESOLUTION”)

Mr. Barner next reminded the Board that to continue membership in the AWBD Water Smart program, it should approve a resolution approving submittal of such application.

Mr. Barner then reminded the Board of the requirements for inclusion in such program. A brief discussion ensued.

Upon a motion by Director Tryon, seconded by Director Patton, after full discussion and with all Directors present voting aye, the Board approved the Water Smart Resolution for the period of January 1, 2024 through December 31, 2024.

SECURITY AT DISTRICT FACILITIES

Extensive discussion ensued regarding the Fencing and above-mentioned customers. It was the consensus of the Board that Directors White and Tryon make contact with the property owners adjacent to the Browning Street WTP after RAB and Hays North confirm certain regulations applicable to fencing around the District’s facilities.

ATTENDANCE AT AWBD FALL SEMINAR AND MID-WINTER CONFERENCE ON JANUARY 24-25, 2025

Discussion then ensued regarding the Directors attendance at the AWBD 2024 Fall Seminar (date unknown at this time), and the Mid-Winter Conference to be held in Austin, Texas on January 24-25, 2025.

Upon a motion by Director Moravec, seconded by Director Patton, after full discussion and with all Directors present voting aye, the Board authorized the Directors’ attendance at the AWBD Fall Seminar and Mid-Winter Conference.

DEVELOPMENT STATUS OF DISTRICT UNDER TEXAS WATER CODE SECTION 49.23603 FOR 2024 TAX YEAR

Mr. Barner explained that the Board will need to determine whether the District is considered to be in a “developing” or “developed” district, as defined in Texas Water Code Section 49.23603, for purposes of calculating the District’s 2024 tax rate. Mr. Barner went on to explain that in his opinion and the opinion of the District’s Financial Advisor, the District continues to be a developing district in accordance with the provisions of such section of the Texas Water Code; therefore, the District may adopt a 2024 tax rate in an amount that does not exceed 1.08 times the amount of tax imposed by the District in the 2023 tax year.
Upon a motion by Director Tryon, seconded by Director Patton, after full discussion and with all Directors present voting aye, the Board declared the District to be a developing district for purposes of calculating the District’s 2024 tax rate setting procedures.

ATTORNEY’S REPORT

Regarding the Walden Fire Station, a discussion ensued regarding the lease agreement for the Walden Fire Station between the District and Montgomery County Emergency Services District No. 2 (“MCESD 2”).

Upon a motion by Director Moravec, seconded by Director Patton, after full discussion and with all Directors present voting aye, the Board appointed Directors Tryon and White to review such lease and such station.

EXECUTIVE SESSION

Pursuant to Section 551.071 of the Texas Government Code, Subchapter D, of the Open Meetings Act, the President called the executive session to order at 10:30 a.m. to discuss matters of attorney-client privilege. Present for all or portions of the Executive Session were the Board of Directors; Messrs. Abshire, Murphy, and Barner.

RECONVENE IN OPEN SESSION

As of 10:55 a.m., the President declared the Executive Session was ended and open session was resumed.

THERE BEING NO FURTHER BUSINESS BEFORE THE BOARD, the meeting was adjourned at 10:55 a.m.

PASSED AND APPROVED this the 14th day of August, 2024.

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Secretary, Board of Directors