Approval of a Resolution Consenting to the Addition of Approximately 176.613 Acres to Morningstar Ranch Municipal District No. 1 from Morningstar Ranch Municipal District No. 2, and Authorize Execution of the Second Restatement and Amendment to the Development Agreement, the Second Restatement and Third Amendment to the Utility Agreement, and Amendments to the Agreements Concerning the Creation and Operation for Morningstar Ranch Municipal Districts No. 1 and No. 2 to Reflect a Boundary Adjustment Between the MUDs and Allow for Redistribution of  Bond Limit Amount (EXTRATERRITORIAL JURISDICTION/PARKER COUNTY) (FUTURE COUNCIL DISTRICT 3)

It is recommended that the City Council approve a resolution consenting to the addition of approximately 176.613 acres to Morningstar Ranch Municipal District No. 1 from Morningstar Ranch Municipal District No. 2 and authorizing the City Manager to execute the second restatement and Amendment to the Development Agreement, the second restatement and Third Amendment to the Utility Agreement, and Amendments to the Agreements concerning the creation and operation for Morningstar Ranch Municipal Districts No. 1 and No. 2 to reflect the boundary adjustment of Morningstar Ranch Municipal Districts No. 1 and No. 2 and allow for redistribution of bond limit amount.

FG Aledo Development, LLC, a Texas Limited Liability Company and FWFW Holdings, Inc., a Texas Corporation (collectively Owner), own and intend to develop approximately 737 acres in Fort Worth's Extraterritorial Jurisdiction (ETJ) in Parker County.  At the request of the prior owner, the City Council passed consent resolutions creating Morningstar Ranch Municipal Utility District No. 1 and No. 2 on December 4, 2007.  On the same agenda, the City Council approved the associated Development and Utility Agreements (City Secretary Contract (CSC) Nos. 36202 and 36195).  The Utility Agreement was first amended in May 2011 (CSC No. 36195-A1).   On June 9, 2015, the City Council approved subsequent amendments to the agreements to revise the traffic management plan, adjust the lot size, revise the water and sewer infrastructure requirements and to provide for the City the right to apply for the Certificate of Convenience and Necessity for the MUDs Mayor and Council Communication (M&C C-27321). The current owner is requesting that the City Council consider approving the proposed restatements and amendments to the Development and Utility Agreements that coincide with the most recently approved preliminary plat (see attached Morningstar preliminary plat).

The Owner has requested the City's approval to allow  Morningstar Ranch Municipal Utility District No. 1 to annex approximately 176.613 acres from MUD No. 2. In addition, the Owner would like to redistribute the bond limit amounts currently recorded in the Agreements to allow for MUD No.1 to increase its bond limit of $90,000,000.00 and MUD No. 2's bond limit would now be $30,000,000.00. This redistribution does not increase the total amount of bond issuance previously approved by the City Council.

As a condition to consenting to the annexation by MUD No.1 and disannexation by MUD No. 2, as well as the redistribution of the bond limit amount, the Owner agreed and the MUDS shall levy a total ad valorem tax rate (including its debt service tax rate and maintenance and operation tax rate) of no less than $1.00 per $100.00 assessed valuation through the life of the MUDs. The City will also have the right to review the MUD's submission to the TCEQ for any bond related activity and shall be entitled periodic reports from the MUDs showing that the infrastructure assets are being maintained properly. These requirements would be reflected in the amended Creation and Operation Agreements of Morningstar Ranch Municipal Utility District No.1 and No. 2 (CSO Contracts No. 36198 and No. 36199) as well as the Development and Utility Agreements. The City will receive the revenue generated from the tax surplus upon annexation.


The Morningstar Ranch development is located in the ETJ of Parker County and in FUTURE COUNCIL DISTRICT 3.