ORDINANCE NO. 9ai i i9-L

AN ORDINANCE ADOPTING A STRATEGIC PARTNERSHIP AGREEMENTWITH THE ANDERSON MILL MUNICIPAL UTILITY DISTRICT WHICHPROVIDES FOR FULL PURPOSE ANNEXATION OF CERTAIN TERRITORY,AND LIMITED PURPOSE ANNEXATION WITH CONVERSION TO FULLPURPOSE ANNEXATION OF ADDITIONAL TERRITORY, ALL TERRITORYADJACENT TO THE CITY LIMITS OF THE CITY OF AUSTIN, CONSISTINGOF APPROXIMATELY 1,105 ACRES OF LAND LOCATED IN TRAVISCOUNTY AND WILLIAMSON COUNTY, TEXAS, AND CONSISTING OF THEANDERSON MILL MUNICIPAL UTILITY DISTRICT; AND DECLARING ANEMERGENCY.

BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF AUSTIN:

PART 1. FINDINGS.

The Council finds that under Section 43.0751 of the Local Government Code:

(A) Notices of two public hearings concerning the adoption of a StrategicPartnership Agreement ("Agreement") with the Anderson Mill MunicipalUtility District ("District") consisting of the territory described in theAgreement attached to this ordinance were published in a newspaper ofgeneral circulation in the City of Austin and in the District.

(B) Notices of two public hearings concerning limited and full purposeannexation of certain tracts within the District according to the terms of theAgreement, such tracts being described in the Agreement, were published ina newspaper of general circulation in the City of Austin and in the area to beannexed.

(C) The Agreement is attached as Exhibit A to this ordinance.

(D) The Agreement was made available before the public hearings in accordancewith Section 43.0751 of the Local Government Code.

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(E) The City conducted public hearings regarding the Agreement and the limitedand full purpose annexation of territory within the Anderson Mill MunicipalUtility District as provided in the Agreement consisting of the territorydescribed in Exhibit A on November 5, 1998 at 7:30 p.m., and on November19, 1998 at 7:00 p.m. in Council Chambers.

(F) The District conducted two public hearings regarding the Agreement onOctober 27, 1998 at 6:30 p.m. and on November 12, 1998 at 6:30 p.m. at theDistrict Administrative Office.

(G) The public hearings were concluded after providing an opportunity for allpersons present to be heard with respect to the proposed Agreement and thelimited and full purpose annexation provided in the Agreement.

(H) All procedural requirements imposed by state law for the adoption of theAgreement have been met.

PART 2. STRATEGIC PARTNERSHIP AGREEMENT.

(A) Findings

The Council finds that:

(1) the Agreement with the District was adopted by the Board of Directorsof the District on November 12, 1998 in accordance with Section43.0751 of the Local Government Code;

(2) the Agreement with the District serves the interests of the current andfuture residents of the City of Austin; and,

(3) the Agreement with the District was made available to the public inaccordance with the requirements of Section 43.0751 of the LocalGovernment Code.

(B) Adoption

The Agreement is adopted by the Council, and the City Manager isauthorized to execute the Agreement on behalf of the City.

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PART 3. EMERGENCY.

The Council declares that an emergency exists concerning the safe, orderly, and healthfulgrowth and development of the City to assure the immediate preservation of the publicpeace, health and safety; therefore, this ordinance takes effect immediately on its passageas required by this emergency and as provided by the City Charter of the City of Austin.

PART 4. The Council waives the requirements of Sections 2-2-3 and 2-2-7 of the City Codefor this ordinance.

PASSED AND APPROVED

§ ^§ ^November 19 , 1998. §

Kirk WatsonMayor

APPROVED: l/l/Watert / rMWM ATTEST:Andrew Martin Betty G. BrownCity Attorney Deputy City Clerk

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EXHIBIT A

•1-10-98 QZ:04pra FronHHNSTEAQ SECHREST M I N 1 C K + T-834 P 02/Of F-304

RESOLUTION NO. 98-1112-1

RESOLUTION APPROVING AND AUTHORIZING THE EXECUTIONOF A STRATEGIC PARTNERSHIP AGREEMENT BETWEEN

ANDERSON MILL MUNICIPAL UTILITY DISTRICT ANDTHE CITY OF AUSTIN AND CONTAINING OTHER PROVISIONS

RELATING TO THE SUBJECT

WHEREAS, Anderson Mill Municipal Utility District (the "District") on October 10, 1996and the City of Austin (the "City") on October 24,1996, each adopted resolutions evidencing theintent to negotiate with each other regarding the terms and conditions for the City's annexation ofthe District under a Strategic Partnership Agreement between the panics pursuant toSection 43.0751, TEXAS LOCAL GOVERNMENT CODE, and

WHEREAS, the District and the City have negotiated and agreed upon the terms andconditions of a Strategic Partnership Agreement governing the annexation of the District by the City;and

WHEREAS, both the District and the City have held or scheduled the hearings required bysaid Section 43.0751 to receive comments from the public on the proposed Agreement andcomments have been received and acted upon; and

WHEREAS, said Section 43.0751 requires that the District approve the Strategic PartnershipAgreement before it may be approved by the City; and

WHEREAS, the Board of Directors of the District is of the opinion that it is in the bestinterests of the District that the Strategic Partnership Agreement as negotiated between the City andthe District, a copy of \vhich is attached hereto, be in all things approved and that the appropriateofficers of the District execute The same on behalf of the District; NOW, THEREFORE,

BE IT RESOLVED BY THE BOARD OF DIRECTORS Of ANDERSON MILLMUNICIPAL UTILITY DISTRICT THAT:

Section 1. The matters and tacts stated in the preamble to this Resolution are found anddetermined to be true and correct and arc hereby adopted as a pan of this Resolution.

Section 1. The "Strategic Partnership Agreement Between the City of Austin and theAnderson Mill Municipal Utility District" attached hereto is hereby approved and the appropriateOfficers of the District are hereby authorized to execute the same on behalf of the District and topresent it to the City of Austin for its approval.

•11-10-98 QMKprn Prom-WINSTEAD SECHREST MINICK T-634 P 03/Of F-304

PASSED AND APPROVED this 12th day of November, 1998.

ATTEST:

Cindy Oug&acber, Secretary

(SEAL)

David L.llarper, President

/AW ///y> y>^/ . XX i X>

rd Hankins, Vice President

^^^g ^^^x^William E. Burke, Treasurer

>M* t. H^CU,Kiracofe, Assistant Secretary-Treasurer

,ODMA\PCDCX:!i\AUSTIN_l\1086I5\l1UOO 19225-1

11/10/98ASTRATEGIC PARTNERSHIP AGREEMENT BETWEEN

THE CITY OF AUSTIN ANDTHE ANDERSON MILL MUNICIPAL UTTLITY DISTRICT

THE STATE OF TEXAS §§ KNOW ALL MEN BY THESE PRESENTS:

COUNTY OF TRAVIS §

This Strategic Partnership Agreement Between the City of Austin, Texas and the Anderson MillMunicipal Utility District, formerly known as Williamson County Municipal Utility District No. 1,Williamson and Travis Counties, Texas ("Agreement") is made and entered into by and among theCity of Austin, a municipal corporation, acting by and through its duly authorized City Manager("City"); and the Anderson Mill Municipal Utility District ("District"), acting by and through its dulyauthorized Board of Directors under the authority of Section 43.0751 of the Texas LocalGovernment Code ("Local Government Code").

RECITALS

1. The District is a municipal utility district created under Chapter 54 of the Texas Water Code.All of the territory within the District is located within the city limits and the extraterritorialjurisdiction of the City in Williamson and Travis Counties, Texas. The District encompassesapproximately 1105 acres, more or less. Its boundaries are generally R.M. 620, U.S. 183 andAnderson Mill Road and are more specifically described in Exhibit A and depicted on ExhibitF attached to this Agreement.

2. The City is a municipal corporation established by and chartered under Chapter 90, page 634,of the Special Laws of Texas, 1909, 31st Legislature.

3. The City desires to annex all of the District which would result in the abolition of theDistrict and the City succeeding to all of the District's powers, duties, assets, andobligations.

4. The District and its residents and property owners desire to postpone the City's annexationof the district and desire that the District to continue to exist and to provide for a limiteddistrict to perform some of the functions currently performed by the District.

5 . The intent of this Agreement is to enter into a strategic partnership agreement between theCity and the District regarding the terms and conditions of annexation of the District bythe City in accordance with Section 43.0751 of the Local Government Code and the termsand conditions for the continuation of the District after conversion to a Limited District nosooner than December 31, 2004.

6. The City interprets the objective of Section 43.0751 of the Local Government Code topermit, but not to mandate, municipal negotiation and participation in strategic partnershipagreements such as this Agreement. In light of this construction this provision of theLocal Government Code is beneficial to the exercise of the home rule power and authorityof the City.

7. The City understands that Section 43.0751 of the Local Government Code may requirelimited purpose annexation prior to full purpose annexation in connection with strategicpartnership agreements such as this Agreement. The District construes Section 43.0751 asrequiring limited purpose annexation with conversion to full purpose annexation. The Citydesires to accommodate the District in this regard.

8. Under Section 43.0751 of the Local Government Code the City adopted a resolution onOctober 24, 1996 and the District adopted a resolution on October 10, 1996 that evidencedthe Parties' intention to negotiate with each other regarding the terms and conditions forthe City's annexation of the District. Copies of both of these resolutions are attached tothis Agreement as Exhibits B and C respectively.

9. The District provided notice of two public hearings concerning the adoption of thisAgreement in accordance with the procedural requirements of Section 43.0751 of theLocal Government Code.

10. The District conducted two public hearings regarding this Agreement in accordance withprocedural requirements of Section 43.0751 of the Local Government Code on October 27,1998, at 6:30 o'clock p.m., at the District Administrative Office and on November 12, 1998,at 6:30 o'clock p.m., at the District Administrative Office.

11. The City provided notice of two public hearings concerning the adoption of this Agreement inaccordance with the procedural requirements of Section 43.0751 of the Local GovernmentCode.

12. The City conducted two public hearings regarding this Agreement in accordance withprocedural requirements of Section 43.0751 of the Local Government Code on November 5,1998, at 7:30 o'clock p.m., at the City Council Chambers and on November 19, 1998, at 7:00o'clock p.m., at the City Council Chambers.

13. The District has, by formal action, after public hearings approved this Agreement on November12, 1998, in open session at a meeting held in accordance with the Open Meetings Act.

14. The City has, by formal action, after public hearings approved this Agreement on November19, 1998 in open session at a meeting held in accordance with the Open Meetings Act.

15. All procedural requirements imposed by state law for the adoption of this Agreement have beenmet.

NOW, THEREFORE, for and in consideration of the mutual agreements, covenants, andconditions contained in this Agreement, and other good and valuable consideration, the City andthe District agree as follows:

ARTICLE 1

DEFINITIONS. PURPOSE. AND LEGAL AUTHORITY

Section 1.01 Terms Defined in this Agreement.

In this Agreement, each of the following terms shall have the meanings indicated:

a. "Agreement" means this Strategic Partnership Agreement Between the City of Austin andthe Anderson Mill Municipal Utility District.

b. "Amenities" means the community facilities, parks, pools, greenbelts, other recreationalfacilities and associated buildings and structures owned by the District or the LimitedDistrict and located within the District Boundaries.

c. "City" means the City of Austin, Texas.

d. "Consent Agreement" means the agreement between the City and the original developers ofthe District, namely National Housing Industries, Inc., Lumbermen's InvestmentCorporation and Provident Development Company, entitled "Agreement ConcerningCreation of Williamson County Municipal Utility District No. One," executed November 1,1973, a copy of which Agreement is attached hereto as Exhibit E.

e. "District" means the Anderson Mill Municipal Utility District, Williamson and TravisCounties, Texas, formerly known as the Williamson County Municipal Utility District No. 1.

f. "District Boundaries" means the boundaries of the District as they now exist, includingproperty heretofore annexed or that may hereafter be annexed by the City for full or limitedpurposes, as such boundaries are more particularly described in Exhibit A and depicted onExhibit F attached to this Agreement, which boundaries shall also be the boundaries of theLimited District.

g. "Full Purpose Commercial Property" means both the commercial property area in the Districtheretofore annexed and the commercial property area to be annexed for full purposes pursuantto this Agreement, both of which areas are depicted in Exhibit F attached to this Agreement.

h. "Limited District" means the Anderson Mill Limited District resulting from the conversion ofthe Anderson Mill Municipal Utility District under Section 43.0751 of the Local GovernmentCode.

i. "Limited Purpose Commercial Property" means the property in the District as depicted inExhibit F attached to this Agreement to be annexed initially by the City for limited purposespursuant to this Agreement

j. "Notice" means any formal notice or communication required or authorized to be given by oneParty to another by this Agreement.

k. "Parties" means the City and the District, or the Limited District, as the case may be.

1. "Party" means the City, the District, or the Limited District, as the case may be.

m. "Period of Limited Purpose Annexation" means that period commencing on the effective dateof the limited purpose annexation of the Limited Purpose Commercial Property and endingupon the effective date of the conversion of the District to the Limited District.

n. "Residential Property" means all of the property in the District (other than the Full PurposeCommercial Property and the Limited Purpose Commercial Property) as depicted in ExhibitF attached to this Agreement to be annexed initially by the City for limited purposes pursuantto this Agreement.

Section 1.02 Purpose of the Agreement.

The purpose of this Agreement is to define and clarify, through contractual agreement, the terms andconditions of annexation of property in the District by the City and the relationship between the Cityand the Limited District upon conversion of the District to the Limited District at the time fullpurpose annexation of the entire District is completed, all in accordance with Section 43.0751 of theLocal Government Code.

Section 1.03 General Location and Description of the District.

The District is a municipal utility district created under Chapter 54 of the Texas Water Code. Allof the territory within the District is located in part within the city limits and the balance is withinthe extraterritorial jurisdiction of the City in Williamson and Travis Counties, Texas. The Districtencompasses approximately 1105 acres, more or less. Its boundaries are generally R.M. 620, U.S.183 and Anderson Mill Road and are more specifically described in Exhibit A and depicted inExhibit F attached to this Agreement.

ARTICLE IIADOPTION OF THE AGREEMENT AND ANNEXATION OF THE

DISTRICT

Section 2.01 Conduct of Public Hearings.

The District and the City acknowledge and agree that prior to the execution of this Agreement andprior to both limited and full purpose annexation pursuant to this Agreement, the District and theCity have conducted public hearings for the purpose of considering the adoption of this Agreementand annexation of the District in accordance with the terms of this Agreement.

Section 2.02 Effective Date of Agreement.

Under the provisions of Section 43.0751(c) of the Local Government Code, this Agreement shallbecome effective on November 19, 1998, the date of adoption of this Agreement by the City. Uponadoption, the Agreement shall be filed by the City in the real property records of Williamson andTravis Counties, Texas.

Section 2.03 Annexation of Full Purpose Commercial Property, Limited Purpose CommercialProperty and Residential Property.

a. The District and the City agree that the Full Purpose Commercial Property not previouslyannexed by the City shall be annexed by the City for full purposes effective on or afterDecember 30, 1998 under Section 43.0751 (f)(4) of the Local Government Code. The Districtand the City further agree that the Limited Purpose Commercial Property shall be annexed bythe City for limited purposes effective December 31,1998 under Section 43.0751 of the LocalGovernment Code and Article I, Section 7 of the City's Charter. The Parties agree that all ofthe Limited Purpose Commercial Property upon limited purpose annexation of the same by theCity and the Full Purpose Commercial Property upon full purpose annexation of the same bythe City shall continue to be a part of the District following such annexation and shall continueto receive the same services from the District that each now receives until the conversion of theDistrict to the Limited District, at which time services shall be in accordance with thisAgreement or in accordance with separate transition agreements pursuant to Section 3.02 of thisAgreement. The District and the Limited District may continue to levy an ad valorem tax inall of the areas within the District Boundaries as long as the District or the Limited Districtcontinues to exist, irrespective of annexations for limited or full purposes by the City of anyareas within the District Boundaries.

b. The District and the City agree that the City may proceed to annex the Residential Property asdepicted in Exhibit F for limited purposes no sooner than during the year 2004 under Section43.0751 of the Local Government Code in accordance with the terms and conditions of thisAgreement and in accordance with Article I, Section 7 of the City's Charter for the purpose ofplanning, zoning, health, and safety. The Parties further agree that the limited purposeannexation of the Residential Property will proceed on a schedule that permits the annexationto be effective no sooner than November 30, 2004.

c. The Period of Limited Purpose Annexation for the Limited Purpose Commercial Property andthe Residential Property shall end no sooner than December 31, 2004 in accordance with theprovisions of this Agreement.

d. The District on behalf of all present and future owners of land within the District Boundarieshereby consents to the City's annexation of the Residential Property and Limited PurposeCommercial Property for limited purposes as provided in this Agreement. The District onbehalf of all present and future owners of land within the District Boundaries hereby consentsto the City's full purpose annexation of the Full Purpose Commercial Property not previouslyannexed for full purposes by the City, all as provided in this Agreement. It is the intent of theParties that the consent granted in this Agreement shall bind the District and each owner andfuture owner of land within the District Boundaries.

e. The City shall develop a service plan as required by law for the Full Purpose CommercialProperty not heretofore annexed that is to be annexed for full purposes and provide it to theBoard of Directors of the District. The City shall also prepare a service plan for the ResidentialProperty and the Limited Purpose Commercial Property and provide it to the Board of Directorsof the District no later than September 1 of the year in which the City elects to annex for fullpurposes the Residential Property and the Limited Purpose Commercial Property. The serviceplans shall provide a description of services to be provided to the District and its successorLimited District by the City upon conversion of the District to the Limited District. Thedescription of services shall be similar to the description of services provided under the termsof Section 43.056 of the Local Government Code. In preparing the service plans pursuant tothis paragraph, the City will confer with the Board of Directors and residents of the Districtregarding the provisions of the service plans.

f. The District agrees that the City may take any and all steps required by the Local GovernmentCode to assure that full purpose annexation of all of the land within the District may becompleted no sooner than December 31, 2004 as provided in Section 2.07 of this Agreement.

Section 2.04 Regulatory and Taxation Authority of the City in the Residential Property andthe Limited Purpose Commercial Property Areas During Limited Purpose Annexation.

Upon limited purpose annexation of the Residential Property or the Limited Purpose CommercialProperty, the City shall have the authority (except as specially provided in this Agreement) withinthe territory annexed for limited purposes, during the Period of Limited Purpose Annexation, to:

a. control and regulate the use of property and the density of structures;

b. require compliance with reasonable zoning regulations;

c. control and regulate the subdivision of property;

d. adopt all reasonable regulations pertaining to health and safety as provided by law, and requirecompliance with such regulations; and

e. collect sales tax as provided in subsection (k) of Section 43.0751 of the Local GovernmentCode; except that the City shall have no authority to levy any other taxes within the territoryannexed for limited purposes during the Period of Limited Purpose Annexation.

Section 2.05 District Residents as Citizens of the City During Limited Purpose Annexation.

a. As provided by Article 1, Section 7 of the City's Charter, upon limited purpose annexation anyresident of that portion of the District annexed for limited purposes shall be deemed to be acitizen of the City and shall be entitled to vote in City elections on every issue where thequestion before the electorate is the election or recall of a City Council member, or theamendment of the City's Charter.

b. As provided by Article 1, Section 7 of the City's Charter, no resident of that portion of theDistrict annexed for limited purposes is eligible to run for office in the City during the Periodof Limited Purpose Annexation.

c. As provided by Article 1, Section 7 of the City's Charter, on limited purpose annexation anyresident of that portion of the District annexed for limited purposes shall be deemed to be acitizen of the City in connection with ordinances, rules or regulations which are applicable tothe citizen by virtue of the limited purpose annexation.

Section 2.06 Automatic Conversion to Full Purpose Annexation of Limited Purpose AnnexedAreas.

a. The District and the City agree that Section 43.0751(5)(A) of the Local Government Code mayrequire that the District be annexed for limited purposes for the automatic conversionprovisions of this Agreement to apply. However, the City and the District have agreed tolimited purpose annexation of the Residential Property and the Limited Purpose Commercial

Property and the full purpose annexation of the Full Purpose Commercial Property notheretofore annexed as provided in Section 2.03 of this Agreement.

b. The District and the City agree that the limited purpose annexation of the Limited PurposeCommercial Property and the Residential Property under this Agreement shall be automaticallyconverted to full purpose annexation no sooner than December 31,2004 as provided in Section43.0751(f)(5)(A) of the Local Government Code. This full purpose annexation conversion maybe completed under Section 43.0751(h) of the Local Government Code without any furtheraction required of the governing body of the City. The City may, however, elect to follow theprocedures contained in the Local Government Code for full purpose annexation of theResidential Property and the Limited Purpose Commercial Property provided that the fullpurpose annexation is consistent with the terms of this Agreement.

c. The District on behalf of all present and future owners of land within the District herebyconsents to the conversion of the limited purpose annexation of the Residential Property andthe Limited Purpose Commercial Property to annexation for full purposes at the time specifiedin this Agreement, it being the intent of the Parties that the consent granted in this Agreementshall bind the District and each owner and future owner of land within the District.

Section 2.07 District Residents as Citizens of the City Upon Full Purpose Annexation of anArea of the District.

A resident of an area of the District annexed for full purposes becomes a citizen of the City for allpurposes and shall have all the rights, privileges, and responsibilities accorded to the citizensresiding in all other areas that the City has annexed for full purposes. However, such citizens shallcontinue to be citizens also of the District or the Limited District until it is dissolved.

Section 2.08 Notice to Landowners of Full Purpose and Limited Purpose Annexation of LandWithin the District.

The District agrees to file the following notice concerning this Agreement in the real propertyrecords of Williamson and Travis Counties for the property within the District:

All of the property within the boundaries of Anderson Mill Municipal Utility District ofWilliamson and Travis Counties, Texas (the "District"), as depicted on the map attached hereto,is subject to the terms and conditions of a Strategic Partnership Agreement ("Agreement")between the District and the City of Austin, dated November 19, 1998. The Agreement

establishes a timetable for the annexation by the City of Austin of the property in the District,part of which will be annexed directly for full purposes and other of which will be annexedinitially for limited purposes and subsequently for full purposes. These areas and the specificannexation plan for each are shown on the attached map. The Agreement also provides for theconversion and the timing for conversion of the District to a Limited District and establishesthe governmental and operational relationship between the City and the District while theDistrict or the Limited District continues in existence, all as authorized by Section 43.0751,Texas Local Government Code. A copy of the Agreement may be obtained by contacting theoffices of the District, and questions concerning the Agreement may be directed to the Districtor the City of Austin Planning-Environmental and Conservation Services Department.

This notice with appropriate modifications shall also be included in the notice to purchasers of realproperty in the District in each future edition of the District's Information Form required to berecorded in the real property records of Williamson and Travis Counties, Texas, pursuant to Section49.455 of the Texas Water Code.

Section 2.09 Regulatory and Taxation Authority of the City and the District Upon FullPurpose Annexation of an Area of the District.

Upon full purpose annexation of an area of the District not heretofore annexed by the City forfull purposes, the City shall have all the authority and power, including taxation authority, withinthe full-purpose annexed area that the City enjoys in all other areas that the City has annexed ordoes annex for full purposes. During the Period of Limited Purpose Annexation the District shallcontinue to have and thereafter the Limited District shall have within the District Boundaries allof the authority and power, including taxation authority, of a municipal utility district, except asmodified by the terms and provisions of this Agreement and applicable law, so long as theDistrict or Limited District exists.

ARTICLE IIISERVICES TO THE DISTRICT

ANDOTHER TRANSITIONAL MATTERS

Section 3.01 Municipal Services During the Period of Limited Purpose Annexation.

a. The parties understand and agree that no City services other than those currently beingprovided, such as but not limited to wholesale water supply, and police, fire, and emergency

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medical responder services, will be provided in any area within the District Boundaries priorto the conversion of the District to the Limited District except as may be provided in the serviceplans prepared pursuant to Section 2.03e and other provisions of this Agreement or as may beprovided in accordance with transition agreements between the parties contemplated by Section3.02.

b. Except as otherwise provided in this Agreement with respect to services that will be providedby the Limited District after its conversion from the District, City services not now beingprovided within the District Boundaries shall commence upon conversion of the District to theLimited District and in accordance with the service plans adopted by the City pursuant toSection 2.03e. The Parties understand and agree that the portion of the service plans addressingservices to be provided in the event of the dissolution or termination of the District or theLimited District for any reason shall be performed by the City upon dissolution or terminationas provided by Section 43.0751(f)(8) of the Local Government Code and Section 7.02 of thisAgreement.

c. The City has prepared a Limited Purpose Annexation Planning Study for the Limited PurposeCommercial Property, which is to be annexed initially for limited purposes by December 31,1998. The study is contained in Exhibit G attached to this Agreement. The Limited PurposeAnnexation Planning Study for the Residential Property, which is to be annexed initially forlimited purposes, shall be prepared in accordance with Section 43.123 of the Local GovernmentCode prior to the annexation of the Residential Property for limited purposes, but no later thanSeptember 1 of the year in which the City elects to annex for full purposes the ResidentialProperty and the Limited Purpose Commercial Property.

Section 3.02 Separate Transition Agreements.

The Parties contemplate that they may negotiate and execute separate transition agreementsconcerning their relationship during the term of this Agreement or any extension. Those transitionagreements shall automatically be incorporated in this Agreement for the purposes set forth in thisAgreement.

Section 3.03 Capital Improvements During the Period of Limited Purpose Annexation;Effluent Reuse.

a. During the Period of Limited Purpose Annexation and until the District is converted to theLimited District, the District shall continue to be responsible for making capital improvements

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to its water and wastewater facilities, parks facilities, and for drainage, prevention of erosion,remediation of storm damage and channel dredging, and for any other municipal services whichthe District is now providing and shall continue to provide to its inhabitants within the DistrictBoundaries. The District shall make these capital improvements only under the same terms andconditions in effect under the Consent Agreement.

b. Prior to full purpose annexation of the Residential Property in the District and the conversionof the District to the Limited District, the Parties agree that the District may, with prior Cityapproval, design and construct a reclaimed water system to provide a beneficial reuse of theeffluent from the District's existing wastewater treatment plants. The District may use sucheffluent without any charge by the City for the purpose of irrigation of property owned,managed or maintained by the District. The Parties further agree that the funds to be used forconstructing these facilities may be only those excess funds from utility rates described inSection 3.05b.

Section 3.04 District Tax Rate.

a. To the extent permitted by law, the District agrees upon the effective date of this Agreementto increase its property tax rate per $100 assessed valuation on an annual incremental basis suchthat upon conversion of the Residential Property and the Limited Purpose Commercial Propertyto full purpose annexation, the District's property tax rate will approximate the City's propertytax rate per $100 assessed valuation in effect on December 31 of the year prior to the year inwhich the City elects to annex for full purposes the Residential Property and the LimitedPurpose Commercial Property.

b. The District shall be entitled to retain all monies collected in taxes in excess of the District'soperations and maintenance expenses and any surplus debt service taxes remaining after theDistrict's entire bonded indebtedness is retired, and the same shall be used to pay all of theDistrict's outstanding indebtedness prior to the date of conversion of the District to the LimitedDistrict, as more fully provided in Section 4.0 Ic of this Agreement, and also to pay for theoperation and maintenance expenses of the Limited District after its conversion from theDistrict.

i. The District shall separate such funds from its general fund and place them in a specialfund account reflecting the source of these funds.

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ii. The District shall provide the City with an annual accounting at the close of the District'sfiscal year for each year of the special fund account reflecting the status of the account.

c. The District agrees to report the annual debt tax rate and operations and maintenance tax rateset by the District to the District's tax collector in Williamson County, and to do and performall acts required by law for the tax rates to be effective.

Section 3.05 Water and Wastewater Utility Rates Charged by the District.

a. To the extent permitted by law, the District agrees to raise the rates it charges for water andwastewater services on an annual basis such that those rates shall equal comparable water andwastewater utility rates charged by the City on June 1 of the year prior to the year in which theCity elects to annex for full purposes the Residential Property and the Limited PurposeCommercial Property. The annual incremental increases shall be proportional over time.

b. The District may retain all monies collected through the increases in utility rates in excess ofthe District's annual capital expenditures and operations and maintenance expenses and thesame shall be used to pay all of the District's outstanding indebtedness prior to the date ofconversion of the District to the Limited District, as more fully provided in Section 4.01 c of thisAgreement, and also to pay for the operation and maintenance expenses of the Limited Districtafter conversion from the District.

i. The District shall separate such funds from its general fund and place them in a specialfund account reflecting the source of these funds.

ii. The District shall provide the City with an annual accounting at the close of theDistrict's fiscal year for each year of the special fund account reflecting the status ofthe account.

Section 3.06 Employment Contractual Obligations of the District.

The District agrees that as of the effective date of this Agreement, it will not enter into anycontracts for employment that will result in the creation or continuation of a contractualobligation for the City after the date of conversion of the District to the Limited District. Inaddition, all future employment contracts shall provide that if the Limited District is dissolvedfor any reason, the employment contracts shall automatically expire on the date of dissolution.

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ARTICLE IVDISTRICT ASSETS. LIABILITIES. OBLIGATIONS. DEBTAND DEBT SERVICE AND THE CONSENT AGREEMENT

Section 4.01 Assets, Liabilities, Indebtedness, and Obligations During the Period of LimitedPurpose Annexation.

a. The Consent Agreement, to the extent that it is not inconsistent with the provisions of thisAgreement or the transition agreements contemplated by Section 3.02 of this Agreement, shallremain in full force and effect until, and shall expire upon, conversion of the District to theLimited District.

b. If there is a conflict between either the Consent Agreement or the transition agreementscontemplated by Section 3.02 of this Agreement and this Agreement, this Agreement shallcontrol.

c. The District's contracts, assets, liabilities, indebtedness, and obligations will remain theresponsibility of the District until conversion of the District to the Limited District. In addition,the District shall pay all of the District's outstanding indebtedness, including bondedindebtedness, as provided in Section 4.02c, prior to the date of conversion of the District to theLimited District. At the time of conversion, the District's contracts, assets, liabilities and otherobligations shall become the responsibility of the City, except as provided in Section 5.02 orotherwise in this Agreement. Prior to conversion of the District to the Limited District,disposition or acquisition of additional contracts, assets, liabilities, indebtedness andobligations shall be governed by the Consent Agreement to the extent the Consent Agreementis not inconsistent with this Agreement or the transition agreements contemplated by Section3.02 of this Agreement.

Section 4.02 Assumption of the District's Outstanding Obligations, Assets, Debts, andLiabilities by the City.

a. The City shall assume none of the District's obligations or assets during the period precedingconversion of the District to the Limited District, except as specifically provided in thisAgreement or the transition agreements contemplated by Section 3.02 of this Agreement.

b. Upon conversion of the District to the Limited District, all of the obligations, liabilities,indebtedness, and assets of the District shall be assumed by the City except those obligations,

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liabilities, indebtedness, and assets specifically designated by this Agreement to remain theresponsibility of the Limited District or to be paid by the District prior to conversion of theDistrict to the Limited District, as provided in Section 4.01c of this Agreement, or pursuant toSection 4.02c below, and those obligations, liabilities, assets and indebtedness incurred oracquired by the District in violation of the Consent Agreement. The obligations, liabilities,indebtedness, and assets of the District not assumed by the City pursuant to this paragraph shallremain the responsibility of the District and the Limited District.

c. The Parties specifically understand and agree that all outstanding bonded indebtedness of theDistrict shall be paid by the District prior to December 31 of the year in which the City electsto annex for full purposes the Residential Property and the Limited Purpose CommercialProperty.

Section 4.03 No City Liability for Limited District Operations.

a. The Parties agree that the City shall not be liable for any or all claims or causes of actionarising out of, or resulting from the maintenance or operations, or ownership of the facilitiesowned by the Limited District in the performance of its functions as described in thisAgreement.

b. In addition, the Parties agree that the City shall not be liable for any or all claims or causes ofaction arising out of or resulting from the maintenance, operations, or other activities of theLimited District on any property owned by the City.

c. To the extent authorized by law, the Limited District shall indemnify, defend, and holdharmless the City from any claims, demand, actions, and causes of action whatsoeverarising out of or resulting from the maintenance, operations, or ownership of any facilitiesowned by the Limited District in the performance of its functions described in thisAgreement, or the maintenance, operations, or other activities of the Limited District on anyproperty owned by the City.

d. The Limited District shall add the City of Austin as an added insured on its general liabilityinsurance which the Limited District shall carry each year for the duration of the existenceof the Limited District.

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Section 4.04 Additional Bonds and Indebtedness by Limited District.

a. The Limited District shall not issue bonds for any purpose without the prior written consent ofthe City.

b. The Limited District may not issue notes, incur indebtedness or enter into lease agreementsother than for normal operation and maintenance of the Limited District and for the purposesauthorized in Section 5.03f of this Agreement. Any such obligations or debts incurred by theLimited District may not extend beyond the term of the Limited District then in effect.

ARTICLE VDISTRICT CONTINUATION AS A LIMITED DISTRICT FOR MAINTENANCE

AND OPERATION OF PARKS AND RECREATION FACILITIES

Section 5.01 Continuation as a Limited District.

a. Upon the effective date of the full purpose annexation by the City of all property within theDistrict Boundaries, the District shall automatically convert to a limited district under Section43.0751 (f)(6) of the Local Government Code and shall be known as the "Anderson MillLimited District".

b. The boundaries of the Limited District shall be coextensive with the District Boundaries.

c. The Limited District shall exist for an initial term of 10 years. The term of the Limited Districtmay be renewed successively by mutual agreement of the governing bodies of the City and theLimited District.

Section 5.02 Functions and Responsibilities of the Limited District.

The functions and responsibilities of the Limited District shall be limited to the following, whichmay be changed from time to time by transition agreements pursuant to Section 3.02:

a. owning, maintaining, operating, controlling, and assuming responsibility and providingadditional security for the Amenities located within the District Boundaries;

b. providing residential and commercial solid waste pick-up and disposal; and

16

c. enforcement of deed restrictions pursuant to Section 54.237, Texas Water Code.

The City will not provide, or charge or bill the Limited District or its residents for, services theLimited District provides.

Section 5.03 Amenities.

a. All Amenities described in Exhibit D shall be available for the benefit, use and enjoyment ofall of the residents of the Anderson Mill Limited District and all City residents.

b. The Parties agree that if the Limited District assesses fees and charges for the use of theAmenities by the residents of the Limited District the Limited District may also assess theresidents of the City not residing in the Limited District for the use of those Amenities.Residents of the City who do not reside in the Limited District may not be assessed for the useof these Amenities if the residents of the Limited District are not assessed for the use of theAmenities. However, residents of the City who do not reside in the Limited District may becharged no more than the City summer pass rate for use of the Limited District's swimmingpools. The Limited District may set a daily rate fee for use of the Limited District's pools ata uniform level for all residents of the City, including residents of the Limited District.

c. The Parties agree that the City shall have no obligation during the existence of the LimitedDistrict to perform the functions undertaken by the Limited District, provided, however, theLimited District's rights to provide security for the Amenities shall not diminish the City'sobligations to provide adequate police protection in accordance with the requirements of Statelaw.

d. The Limited District may not sell, convey, lease, mortgage, transfer, assign, or otherwisealienate any of its Amenities to a third party. The Limited District may not approve aprogram or project that requires the use or taking of its Amenities or that would otherwiserequire findings under Section 26.001 of the Texas Parks and Wildlife Code. However, thissubsection d shall not prohibit the Limited District from contracting with management andoperating firms to manage and operate any of the District's Amenities.

e. The Limited District may not sell, convey, lease, mortgage, transfer, assign, or otherwisealienate any of its surplus assets to a third party without the prior approval of the CityManager or his designee, which approval shall not be unreasonably withheld or delayed.

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f. The Limited District may not acquire, purchase, or lease additional Amenities or expand anyexisting Amenities. However, the Limited District may purchase necessary equipment,materials and facilities to maintain, replace or upgrade the level of Amenities available at thetime of this Agreement.

g. The Limited District may hire employees, agents, representatives, and consultants to manage,operate and maintain the Amenities and perform services related to the Limited District'soperations and activities.

Section 5.04 Easement and Fee Simple Dedication of District Facilities to City.

a. The District shall grant to the City fee simple title or public utility easements to all real propertycontaining facilities presently owned by the District that are to be transferred to the City on thedate of conversion of the District to the Limited District. The dedication shall be byappropriate instrument and the District shall perform all acts necessary prior to the effectivedate of the conversion to accomplish the transfer of title effective on the date of conversion,including but not limited to subdividing and replatting the real property on which the facilitiesare located. However, should the transfer of title to all such properties not be accomplished forany reason by the effective date of the conversion of the District to the Limited District, theLimited District shall proceed promptly to conclude the transfer following conversion. Thefacilities to which this paragraph applies shall be identified in a transition agreement pursuantto Section 3.02.

b. So that the Limited District may identify people who are residents of the Limited District forpurposes of determining the charge to be made for certain facilities and services, the City willuse its best efforts to provide the Limited District monthly an accurate computerized listing ofall of the City's water and wastewater customers in the District, which shall be delivered notlater than the 20th day of the month following the month to which the list pertains.

Section 5.05 Funding for Amenities, Other Limited District Functions.

a. It is the responsibility of the Limited District to provide all necessary funding for capital andoperations and maintenance expenses associated with the Amenities and other duties describedin Section 5.02 of this Agreement.

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b. The funds held by the District in the special fund accounts referred to in Sections 3.04 and 3.05of this Agreement shall be funds of the Limited District upon conversion of the District to aLimited District as contemplated by those sections.

Section 5.06 Remedies for Failure of Limited District to Discharge its Responsibilities toMaintain, Operate, Control, or Provide Adequate Security for the Amenities.

a. If it is determined as provided in paragraph b of this Section 5.06 that the Limited District hasfailed or ceased to discharge its responsibility to maintain, operate, control, or provideadequate security for the Amenities, or if registered voters of the Limited District seek sucha determination, the City or the Limited District may proceed as provided in this section.

b. Either the City or the District, by formal action of its governing body, may initiate adetermination as to whether the Limited District has failed or ceased to discharge its dutiesand obligations to maintain, operate, or control the Amenities and shall give reasonable noticeof and conduct a public hearing thereon within sixty days after such formal action. Unlessthe City or the District has a determination proceeding underway, the residents of the LimitedDistrict may initiate such a determination by a petition addressed to the City or to the Boardof Directors of the Limited District signed by 10 percent of the registered voters living in theLimited District. The petition shall be processed as provided below before it may be actedon by a Party. The first Party to initiate such a determination proceeding or to which apetition for a determination is addressed, as determined by the date and time of the receiptof the petition by the City Clerk, shall have exclusive jurisdiction over all determinationproceedings until such Party loses or terminates jurisdiction as provided below.

i. A petition for determination initiated by registered voters of the Limited District mustbe submitted to the Clerk of the City.

ii. The Clerk of the City shall verify the signatures on the petition within sixty days ofreceipt. The Clerk shall notify the Party to whom the petition was addressed of thereceipt of the petition and the results of the verification by certified mail within 10days of receipt of the petition and within 10 days of the verification, respectively.

iii. If the City Clerk verifies the petition based on the criteria specified in part ii above, theCity Council, if the petition is addressed to the City and it has jurisdiction, or theBoard of Directors, if the petition is addressed to the Limited District and it hasjurisdiction, shall within sixty days of the verification of the petition by the City Clerk

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give reasonable notice of and conduct a public hearing to consider the request of theresidents of the District. The Party that has jurisdiction may accept further petitionsand consolidate them with the petition or petitions already received; provided,however, acceptance of further petitions shall not operate to extend the date establishedfor the public hearing beyond sixty days following the date of verification of the firstpetition verified by the City Clerk.

iv. The City Council may, upon the conclusion of a public hearing required pursuant tothis Section 5.06, elect to pursue any remedy available to it under Article VII of thisAgreement. The Board of Directors of the Limited District may, upon conclusion ofsuch a public hearing, elect to voluntarily dissolve the Limited District with sixty daysNotice to the City prior to the effective date of dissolution, or the board may elect topursue any other remedy to resolve the issues raised by the residents of the LimitedDistrict so long as that remedy is not prohibited by this Agreement.

v. Action in a proceeding for a determination initiated pursuant to this Section 5.06 mustbe taken by the Party having jurisdiction within six months following the conclusionof the public hearing, or initiated within that period of time and pursued to aconclusion with reasonable diligence, failing which, jurisdiction to act shall terminate.

vi. Once a Party has acquired jurisdiction by formal action of its governing body initiatinga determination or pursuant to a petition under this Section 5.06, the other Party maynot proceed under this Section 5.06, whether on the same or different grounds, untilthe first Party has lost or terminated its jurisdiction. Once jurisdiction has been lost orterminated, another determination may be initiated in accordance with the sameprocedure as above, whether on the same or different grounds.

Section 5.07 Limitations on Limited District Functions.

The Limited District shall have only those functions, purposes, and authorities specificallyenumerated in this Article V. If the Limited District takes any formal action to discharge afunction or to exercise authority that is not directly related to those functions and purposesspecifically enumerated in Article V, the City may proceed as provided in Article VII of thisAgreement.

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Section 5.08 Audit; Review of Limited District Records.

The Limited District shall conduct an annual audit each year, at its sole expense, to be performedby an independent certified public accountant. The Limited District shall file a copy of thecompleted audit with the City's Director of Financial Services. The Limited District shall makeits financial records available to the City for inspection during normal business hours.

ARTICLE VIMISCELLANEOUS PROVISIONS

Section 6.01 Effective Date and Duplicate Counterparts.

This Agreement may be executed in duplicate counterparts but shall not be effective unlessexecuted by the City and the District on or before November 20, 1998. The District agrees that,upon its execution of this Agreement, the District shall be bound by this Agreement; however, theobligations of the District under this Agreement are subject to the condition that the City will takethe action necessary to authorize this Agreement and will execute and deliver the Agreement onor before November 20, 1998, failing which the District may withdraw from this Agreement.

Section 6.02 Limited District Approval and Election.

a. The Board of Directors for the Limited District shall place the adoption and ratification ofthis Agreement on the agenda of its first meeting following the conversion of the District intothe Limited District.

i. If the Board of Directors of the Limited District fails to adopt and ratify thisAgreement within sixty days of the conversion of the District into the Limited District,the Limited District shall be automatically dissolved sixty days after the date ofconversion without the necessity of any further action by the City, whether throughlitigation or otherwise, and all assets, obligations, indebtedness, and liabilities of theDistrict shall be assumed by the City.

ii. The Limited District shall continue to exist after the failure to adopt or ratify thisAgreement for the sole purpose of doing any and all acts or things necessary to transferthe assets, obligations, indebtedness, and liabilities to the City. Upon the completion

21

of the transfer of all assets, obligations, indebtedness, and liabilities to the City, theLimited District shall cease to exist.

b. If the Board of Directors of the Limited District adopts and ratifies this Agreement pursuantto Section 6.02a of this Agreement, the Board of Directors of the Limited District shall callan election no later than the first practicable uniform election date, as determined in thereasonable judgment of the Board of Directors, after such adoption and ratification at whichtime the Limited District shall place a proposition before the qualified voters of the LimitedDistrict to consider ratification of the creation of the Limited District and to authorize an advalorem tax for operation and maintenance of the Limited District. The Board of Directorsat its option may call the election at the same meeting at which it acts on the adoption andratification of this Agreement or at a subsequent meeting, provided that the election date isno later than the first practicable election date after adoption and ratification of thisAgreement, as determined in the reasonable judgment of the Board of Directors.

i. The maximum tax rate to be included within the proposition shall be at the discretionof the Board of Directors of the Limited District, but shall not be less than $0.10 per$100 of assessed valuation nor greater than $0.50 per $100 of assessed valuation. Theproposition shall also provide that any District maintenance tax authorization inexistence before the tax election provided for in this subsection b shall be rescindedupon approval of the proposition by the voters.

ii. If a majority of the qualified voters voting at this election do not approve theproposition, the Limited District shall be automatically dissolved sixty days afterthe date of the election without the necessity of any further action by the City,whether litigation or otherwise, and all assets, obligations, indebtedness, andliabilities of the District shall be assumed by the City.

iii. If the election fails, the Limited District shall continue to exist after the failure forthe sole purpose of doing any and all acts or things necessary to transfer the assets,obligations, indebtedness, and liabilities to the City.

Section 6.03 Entire Agreement.

a. Except as expressly set forth in this Agreement, this Agreement is not intended to waive orlimit the applicability of laws, regulations and ordinances applicable to the District or the

22

City, nor does it waive the jurisdiction or sovereignty of any governmental body with respectto the District or the City.

b. As of this date there are no agreements, oral or written, between the Parties which are inconflict with this Agreement. Except as expressly provided by this Agreement and thetransition agreements contemplated by Section 3.02 of this Agreement, this Agreement,together with all of the attachments to this Agreement, constitutes the entire agreementbetween the Parties with respect to the terms and conditions governing the annexation of theDistrict. Except as expressly provided by this Agreement and the transition agreementscontemplated by Section 3.02 of this Agreement, no representations or agreements other thanthose specifically included in this Agreement shall be binding on either the City or theDistrict.

Section 6.04 Notice.

a. It is contemplated that the Parties will contact each other concerning the subject matter of thisAgreement. However, any Notice shall be given at the addresses below for each of theParties.

b. Notice may be given by:

i. delivering the Notice to the Party to be notified;

ii. by depositing the Notice in the United States Mail, certified or registered, returnreceipt requested, postage prepaid, addressed to the Party to be notified; or

iii. by sending the Notice by telefax with confirming copy sent by mail to the Party to benotified.

c. Notice deposited in the United States mail in the manner hereinabove described shall bedeemed effective from and after the earlier of the date of actual receipt or three days after thedate of such deposit. Notice given in any other manner shall be effective only if and whenreceived by the Party to be notified.

d. For purposes of Notice, the addresses of the Parties shall, until changed as provided in thisSection, be as follows:

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City of Austin: City ManagerP.O. Box 1088Austin, Texas 78767

with required copy to:City AttorneyP.O. Box 1088Austin, Texas 78767

Anderson Mill MunicipalUtility District: President of the Board of Directors

11500ElSalidoAustin, Texas 78750

Anderson MillLimited District: President of the Board of Directors

HSOOElSalidoAustin, Texas 78750

e. The Parties may change their addresses for Notice purposes by providing five dayswritten notice of the changed address to the other Party.

f. If any date or period provided in this Agreement ends on a Saturday, Sunday, or legalholiday, the applicable period for calculating Notice is extended to the first businessday following the Saturday, Sunday, or legal holiday.

Section 6.05 Time.

Time is of the essence in all matters pertaining to the performance of this Agreement.

Section 6.06 Severability or Modification of Agreement as a Result of Modification ofthe State Code and Statutory Authority for the Agreement.

a. If any word, phrase, clause, sentence, paragraph, section, or other part of thisAgreement, or the application of the word, phrase, clause, sentence, paragraph, sectionor other part of this Agreement to any person or circumstance is held by a court of

24

competent jurisdiction to be invalid or unconstitutional for any reason, the Partiesagree that they will amend or revise this Agreement to accomplish to the greatestdegree practical the same purpose and objective of the part determined to be invalidor unconstitutional, including without limitation amendments or revisions to the termsand conditions of this Agreement pertaining to or affecting the rights and authority ofthe Parties in areas of the District annexed by the City pursuant to this Agreement,whether for limited or full purposes, prior to conversion of the District to the LimitedDistrict. If the Parties cannot agree on any such amendment or revision within ninetydays of the final judgment of the trial court or any state appellate court that reviews thematter, then either Party may proceed in accordance with the procedures specified inArticle VII of this Agreement.

b. If any word, phrase, clause, sentence, paragraph, section, or other part of thisAgreement is modified in whole or in part as a result of modifications to theunderlying state code and statutory authority for this Agreement, the Parties agree andunderstand that such modification may frustrate the purpose of this Agreement. Theparties agree that they will attempt to amend or revise this Agreement to accomplishto the greatest degree practical (i) the same purpose and objective of the part of thisAgreement affected by the modification of the underlying state code and statutoryauthority and (ii) the original intent and purpose of this Agreement. If the Partiescannot agree on any such amendment or revision within ninety days from the effectivedate of modification of the state code and statutory authority for this Agreement, thenthis Agreement shall terminate unless the Parties agree to an extension of time fornegotiation of the modification.

c. If this Agreement is terminated as a result of the operation of this Section, the Cityshall have the right to immediately annex the District for full purposes or, if theLimited District has succeeded the District, to immediately dissolve the LimitedDistrict.

Section 6.07 Waiver.

Any failure by a Party to the Agreement to insist upon strict performance by the other Partyof any provision of this Agreement shall not be deemed a waiver of the provision or of anyother provision of the Agreement. The Party has the right at any time to insist upon strictperformance of any of the provisions of the Agreement.

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Section 6.08 Applicable Law and Venue.

The construction and validity of the Agreement shall be governed by the laws of the Stateof Texas (without regard to conflict of laws principles). Venue shall be in Travis County,Texas.

Section 6.09 Reservation of Rights.

To the extent not inconsistent with this Agreement, each Party reserves all rights, privilegesand immunities under applicable law,

Section 6.10 Further Agreement and Documents.

Both Parties agree that at any time after execution of this Agreement, they will, upon requestof the other Party, exchange those transition agreements completed as contemplated bySection 3.02 of this Agreement or any other documents necessary to effectuate the terms ofthis Agreement. Both Parties also agree that they will do any further acts or things as theother Party may reasonably request to effectuate the terms of this Agreement.

Section 6.11 Incorporation of Exhibits and Other Documents by Reference.

All Exhibits and other Documents attached to or referred to in this Agreement areincorporated into this Agreement by reference for the purposes set forth in this Agreement.All of the transition agreements executed in accordance with Section 3.02 are incorporatedinto this Agreement by reference for the purposes set forth in this Agreement and in thetransition agreements.

Section 6.12 Assignability, Successors, and Assigns.

Subject to the provisions of Section 6.02, this Agreement is applicable to and binding on theLimited District as the successor to the District, effective at the time of conversion of theDistrict to the Limited District, and the Parties recognize and agree that this is the effect ofthe conversion. The Directors of the District shall continue in office as the Directors of theLimited District for the balance of the terms of office for which they were elected orappointed to the Board of Directors of the District. As the successor to the District, theLimited District automatically succeeds to, assumes, shall be responsible for and takespossession of and title to all contracts, agreements, property, records, funds, debts,

26

obligations and assets of the District. Except as provided in Section 3.06 of this Agreement,the District employees shall continue as employees of the Limited District, and all orders,rules, policies, procedures, practices, resolutions and other actions of the District shallremain in effect for the Limited District, except as the same are modified by the effect andterms of this Agreement. The Parties recognize and agree that the Limited District standsin the place and stead of the District for all purposes under this Agreement.

This Agreement shall not be assignable by the District or the Limited District without theprior written consent of the City Council of the City.

This Agreement shall be binding upon and inure to the benefit of the Parties and theirrespective representatives, successors, and assigns.

Section 6.13 Amendment.

This Agreement may only be amended in writing upon the approval of the governing bodiesof the City and the District, or the Limited District as the successor to the District.

ARTICLE VIIDEFAULT AND REMEDIES FOR DEFAULT

Section 7.01 Default.

a. Upon the occurrence, or alleged occurrence, of an event of default under or violationof this Agreement, the nondefaulting Party shall send the defaulting Party Notice ofits default or violation or alleged default or violation. Except as otherwise specificallyprovided in this Agreement, the defaulting Party must cure its default or violationwithin seventy-five days following receipt of the Notice of the default or violation.

b. If the default or violation is not cured within the seventy-five day period, thenondefaulting Party may sue for enforcement or cancellation of this Agreement.However, prior to bringing any proceeding in a court of law or before a court ofcompetent jurisdiction, the Parties may resolve the issue through mediation orarbitration. If the Parties agree to seek mediation or arbitration, they must participatein good faith. However, none of the Parties shall be obligated to pursue mediation orarbitration that does not resolve the issue in dispute within seven days after themediation is initiated or within fourteen days after the mediation is requested. Further

27

the parties are not obligated to pursue arbitration that does not resolve the issue withintwenty-eight days after the arbitration is requested. The Parties shall share the costsof the mediation or arbitration equally. The Parties further agree that the City is notobligated to resolve any dispute based on an arbitration decision under this Agreementif the arbitration decision compromises the City's sovereign immunity as a home rulecity.

c. If the Parties are unable to resolve their dispute through mediation or arbitration, thenon-defaulting Party shall have the right to enforce the terms and provisions of thisAgreement by specific performance or by such other legal or equitable relief to whichthe non-defaulting Party may be entitled. If the defaulting Party is the Limited District,the City may sue for termination of this Agreement and the dissolution of the Districtor Limited District. Any remedy or relief described in this Agreement shall becumulative of, and in addition to, any other remedies and relief available at law or inequity.

d If the defaulting Party fails to abide by these deadlines, the non-defaulting Party shallhave all rights and remedies available in law and equity and all rights and remediesprovided in this Agreement.

e. All of these rights and remedies shall be cumulative.

Section 7.02 Dissolution of the District or the Limited District.

a. If the District or Limited District is dissolved, this Agreement shall automaticallyterminate and the City shall have the right to annex all of the territory within theDistrict or the Limited District for full purposes without restriction.

b. If the District or Limited District is dissolved, the Board of Directors for the Districtor the Limited District, as the case may be, shall continue to exist after the dissolutionfor the sole purpose of doing any and all acts or things necessary to transfer the assets,obligations, indebtedness, and liabilities to the City. Upon completion of the transferof all assets, obligations, indebtedness, and liabilities to the City, the District or theLimited District, as the case may be, shall cease to exist.

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IN WITNESS WHEREOF, this Agreement consisting of3l pages and Exhibits A-G isexecuted in duplicate counterparts.

City of Austin, Texas

Attest:

tftor City Clerk

Bv:Jesus uajzaCity Manager

Attest:Cindy OttenbacherSecretary

Anderson Mill Municipal Utility District

David L. HarperPresident

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THE STATE OF TEXAS

COUNTY OF TRAVIS

§§§

^This instrument was acknowledged before me on the ^0~^ day of1998, by Jesus Garza, City Manager for the City of Austin, Texas, for and on behalf of theCity of Austin, Texas.

ftHNETTE M. BOGUSCHNOTARY PUBLIC

State of Texas. 04-30-99

Notary Public In and For the State ofTexasMy Commission Expires: $H '30 -tf *j

THE STATE OF TEXAS

COUNTY OF WILLIAMSON

§§§

This instrument was acknowledged before me on the / c ^ / - d a y of .1998, by David L. Harper, President of Anderson Mill Municipal Utility District for and onbehalf of the Anderson Mill Municipal Utility District.

ULUES.CORLENotary Public, State of Texas

My Commission ExpiresMARCH 20,2000

Notaiy'Public In and For the State ofTexas ,My Commission Expires: ^A £> I

30

STRATEGIC PARTNERSHIP AGREEMENTBETWEEN THE CITY OF AUSTIN AND THE

ANDERSON MILL MUNICIPAL UTILITY DISTRICT

LIST OF EXHIBITS

The following are the exhibits for this Agreement:

Exhibit A

Exhibit B

Exhibit C

Exhibit D

Exhibit E

Exhibit F

Exhibit G

District Boundaries

City SPA Authorizing Resolution

District SPA Authorizing Resolution

District's Amenities

Consent Agreement

Map of District, Full PurposeCommercial Property,Limited PurposeCommercial Property andResidential Property

Limited Purpose Annexation Study

H:\TERRY\SPA_AND2.WPD111019981000:19225-1

31

EXHIBIT "A1

°\y

2-49-3257REVISED BOUNDARY OF WILLIAMSON COUNTY MUNICIPAL UTILITY DISTRICT NUMBER ONE

TRACT 1 - 945 ACRES -

A DESCRIPTION OBTAINED FROM RECORD INFORMATION OF 945 * ACRES OF LANDBEING OUT OF AND A PART OF THE JESSE GRIMES SURVEY. S.A. AND M.G. R.R.CO. SURVEY 1801 AND WM. FRMAPTON SURVEY ABSTRACT 1230 IN PORTIONS OFWILLIAMSON AND TRAVIS COUNTIES, TEXAS. THE SAID 945* ACRES OF LANDBEING OUT OF AND A PART OF THAT ACREAGE CONVEYED TO ANDERSON MILL JOINTVENTURE IN PARCELS OF 737- ACRES IN VOLUME 566 AT PAGE 34 OF THE WILL-IAMSON COUNTY DEED RECORDS AND 208* ACRES IN VOLUME 4834 AT PAGE 1707OF THE TRAVIS COUNTY DEED RECORDS. THE SAID 737* ACRE PARCEL AND 208*ACRE PARCEL WERE SURVEYED INDEPENDENTLY OF EACH OTHER RESULTING IN DIF-FERENT BEARING BASIS; THE DESCRIPTION AS RECORDED IN DEED RECORDS. OF SAID208* ACRE PARCEL HAS BEEN CHANGED TO COINCIDE WITH THOSE OF SAID 737* ACREPARCEL. THE SAID 945* ACRE TRACT MORE PARTICULARLY DESCRIBED AS FOLLOWS:

BEGINNING at a point on the Southerly right-of-way line of Farm to MarketRoad 1620, said point .being the"Northeast corner of the above mentioned203* acre parcel and the Northwest corner of the above mentioned 737* *creparcel.

THENCE, with a Northerly Boundary of this tract of land herein being des-cribed and along the Southerly right-of-way line of Farm to Market Road1620 as follows:

1) N 70e51"E a distance of 1881.87*feet to a point;2) N 71*15"E a distance of 1605.60'feet to the most Northwesterly

corner of Pecan Park a subdivision recorded In WilliamsonCounty, Texas;

THENCE, continuing with the Northerly boundary of this tract of land hereinbeing described, along the.Westerly and Southerly boundary of aforementionedPecan Park subdivision as follows:

1)2)3)4)5)

S 18*47"EN 75°12"EN 47*52"£N 9*35"UN 71'43'E

distance of 1593.77'feet to a point;distance of 1657.21'feet to a point;distance of 725.07'feet to a point;distance of 142.60'feet to a point;distance of 404.23'feet to a point on the Westerly

right-of-way line of U.S. Highway 1183;

THENCE, with a Easterly boundary of this tract of land hefeln being describedand along the Westerly right-of-way line of U.S. Highway 1183 as follows:

1) S 16*21'£ a distance of 462.03'feet to a point;2) S 18*12'E a distance of 1111.73'feet to a point;

THENCE, leaving the right-of-way line of U.S. Highway *183 and continuingwith the Easterly boundary of this tract of land herein being describedas follows:

S 84*39 'WS 24*36 'WS 54*31' WS 7*52'ES 22*12'ES 16'57'EN 46*18'E

distance ofdistacne ofdistance ofdistance ofdistance ofdistance ofdistacne of

972.82'feet to395.54'feet to695.43'feet to

1050.91*feet to152.75'feet to

1166.63'feet to2278.90'feet to

of-way line of said U.S. Highway 1183.

point;point;point;point;point;point;point on the Westerly right-

<\

7291 '258 Page A-l

Z-49-3253 VCL

THENCE, along the said Westerly right-of-way line of said U,S. Highway1183 and a Easterly boundary of this Tract of land herein beingdescribed as follows:

1) 309.37' an arc distance along a curve to the right, saidcurve having a radius of 4989.28'feet and a chord whichbears S 11'13'E a distance of 309.30'feet to-a point;

2) S 9'25'E a distance of 13.50'feet to a point;

THENCE, leaving said highway right-of-way and continuing along a Easterlyboundary of this Tract of land herein being described as follows:

1) S 37"13'W a distance of 2469.37'feet to a point;2) S 15*46'E a distance of 289.9Vfeet to a point;3} S 70°32'H a distance of 562.93'feet to a point;4} S 13°04'E a distance of 518.21'feet to a point in the Northerly

line of the Old Anderson Mill - Jollyville Road;

THENCE, along the Northerly line of Old Anderson Mill - Jollyville Roadas follows:

1} N 87*18'W a distance of 1062.55'feet to a point;2) N 89*18'W a distance of 1316.71'feet to a point;3) N 89*33'H a distance of 1166.49'feet to a point;4) S 86°16'W a distance of 800.00'feet to the Travis-Williamson

County Line and a point;

THENCE, N 56*11'W along the Travis-Williamson County Line, a distance of792.86'feet to a point;

THENCE, N 10*07'E a distance of 883.47'feet leaving said county line toa point;

THENCE, N 8°06'W a distance of 822.80'feet to a point on the Westerly boundaryof the above said 737- acre parcel and the Easterly boundary of the above said208* acre parcel;THENCE, N 84*50'W a distance of 979.56'feet leaving the Westerly boundary ofthat aforementioned In description 737* acre parcels to a point;

THENCE, S 9*24*W a distance of 1078.19'feet to a point on Old Anderson H111-Jollyvllle Road;

THENCE, continuing with the Southerly and Westerly boundary of this tract ofland herein being described and along the Northerly line of Old Anderson Mill-Jollyvllle Road as follows:

distance of 120distance of 96distance of 69distance of 350distance of 169distance of 109distance of 604distance of 209distance of 327distance of 102distance of 988distance of 126,distance of 125.

line of Far* to Market Road

1)23!456789

10111213

NNNNNNNNNNNNN

69*50'78*27'83*33'89*14'54*36'51*29'40*1 V37*50'43*39'41*53'40*43'74*24'T1V

WWWWWWWWwwwuw

.25'feet to a point;

.36'feet to a point;

.10'feet to a point;

.34'feet to a point;

.45'feet to a point;

.86'feet to a point;

.19'feet to a point;

.80'feet to a point;

.38'feet to a point;

.21'feet to a point;

.10'feet to a point;

.7 'feet along a calculated line to a point;

.25'feet to a point on the right-of-way1620;

THENCE, with the Northerly boundary of this tract herein being describedand Southerly right-of-way of Farm to Market Road 1620 as follows:

1) N 46*49'E a distance of 30.301 feet to a point;2) N 44* 071 E a distance of 379.70' feet to a point;3) N 42*31*E a distance of 1685.70* feet to a point;4) 683.70* feet along the arc of a curve to the right said curve

having a radius of 1380.95* feet and a chord which bears N56* 42* E a distance of 676.75' feet to a point;

5) N 70* 53' E a distance of 1103.45* feet to the point ofbeginning containing 945"t acres of land more or less.

Page A-2

Vr-L ":

TRACT 11-83.09 ACRES - i.

Description of 83.09 acres of land, more or less, out of the WilliamFrampton Survey, Abstract No. 230, in Williamson County, Texas, andbeing 38.50 acres out of that certain 41.79 acre tract conveyed toBert Hochfeld, Trustee, in Volume 652 Page 437, and being 27.46acres out of that certain tract conveyed to Forrest Troucman, Trustee,in Volume 618 Page 624, and being 11.55 acres out of and a part ofthat certain 13.57 acre tract conveyed to the Round Rock IndependentSchool District in Volume 654 Page 394, and being all of that 5.58acre tract conveyed to the Round Rock Independent School District inVolume 637 Page 661, as recorded in the Deed Records, WilliamsonCounty, Texas; being more particularly described by metes and boundsas follows:

BEGINNING at a point for the northeast corner of the tract hereindescribed, said point also being the southeast corner of Lot 1,Anderson Mill Convenience Center as recorded in Book 10, Page 15 ofthe Plat Records of Williamson County, Texas, and said point alsobeing on the west right-of-way of U.S. Highway No. 183;

THENCE with the west right-of-way of U.S. Highway No. 183 S 18° 11'E a distance of 1091.57 feet to a point;

THENCE 391.98 feet along the arc of a curve to the right having aradius of 5629.65 feet and a chord which bears S 16° 05* E adistance of 391.90 feet to a point, said point being the most north-easterly corner of Hidden Meadows a subdivision of record in Book 8,Page 27 of the Plat Records of Williamson County, Texas;

THENCE leaving the west right-of-way of U.S. Highway No. 183 andalong the north line of the aforementioned Hidden Meadows subdivisionthe following (8) eight courses:

1) S 53* 29' W a distance of 401.71 feet to a point;2) S 53* 12* W a distance of 360.00 feet to a point;3) S 53° 371 W a distance of 270.51 feet to a point;4) S 53* 301 W a distance of 355.44 feet to a point;5) S 53° 35' W a distance of 325.65 feet to a point on the

east right-of-way- of a 60.00 foot street and the north lineof the aforementioned Hidden Meadow subdivision;

6) S 53" 35' W a distance of 60.12 feet to a point on thewest right-of-way of a 60.00 foot street and the northline of the aforementioned Hidden Meadow subdivision;

7) S 53° 351 W a distance of 220.44 feet to a point;8) S 53* 541 W a distance of 176.89 feet to a point for

the southwest corner of the tract herein described;

THENCE with the west line of the tract herein described and theeast line of Village One at Anderson Mill, a subdivision of recordin Book 9, Page 30 of the Plat Records of Williamson County, Texasthe following (4) four courses:

1) N 16* 571 W a distance of 597.62 feet to a point;2) N 16* 57' W a distance of 100.00 feet to a point;3) N 22* 121 W a distance of 152.75 feet to a point;4) N 07* 521 W a distance of 970.91 feet to a point;

THENCE N 07* 52' W a distance of 80.00 feet to a point for the north-west corner of the tract herein described and from which point thenortheast corner of Lot 1 of Block A of the aforementioned Village

7291 £61A-3

VRL c : 'n»jc r. 3

THE STATE OF TEXAS I

COUNTY OF TRAVIS I

CERTIFICATE

2-49-3259I, the undersigned, a duly registered professional engineer

under the laws of the State of Texas, and a member of Hale & Asso-

ciates, Inc., consulting engineers, do hereby certify that:

(1) I am familiar with and have examined the attached metes

and bounds description of the boundaries of a tract of land within

Williamson County Municipal Utility District No. One containing

945 acres, more or less.

(2) In my opinion, the place of beginning in each of the

calls in said description can be located and followed on the ground.

(3) In my opinion, said metes and bounds description duly

closes and said land lies within Williamson County Municipal Utility

District No. One. .

WITNESS MY HAND AND SEAL this ttf ' day of December, 1980.

fastyfgisttfred Professional Engineer

Number 3392 r~

(SEAL)

7291 260

2-49-3261One at Anderson Mill subdivision bears S 07" 52* E a distance of80.00' and N 34° 00' W a distance of 130.00 feet;

THENCE along the north line of the tract herein described, N 54°31' E a distance of 695.43 feet to a point;

THENCE N 24° 36' E a distance of 395.54 feet to a point;

THENCE N 84° 39' E a distance of 972.89 feet to the POINT OFBEGINNING containing 83.09 acres of land, more or less.

7291 262

CERTIFICATE VOL

THE STATE OF TEXAS -I

COUNTY OF TRAVIS IZ-49-326Z

I, the undersigned, a duly registered professional engineer

under the laws of the State of Texas, and a member of Triad En-

gineering, consulting engineers, do hereby certify that:

(1) I am familiar with and have examined the attached metes

and bounds description of the boundaries of a tract of land within

Williamson County Municipal Utility District No. One containing

83.09 acres, more or less.

(2) This 83.09 acres consists of a 38.50 acre tract, a

23.43 acre tract, a 17.13 acre tract and a 4.03 acre tract des-

cribed in field notes prepared and certified by Jerry B. Hale, P.

E., Registration No. 33925. The certificate of Jerry B. Hale states

that in his opinion, th« place of beginning in each of the calls

in said descriptions can be located and followed on the ground,

that each of said metes and bounds descriptions duly closes, and

each of said tracts of land lies within Williamson County Municipal

Utility District No. One.

(3) 1 am a registered professional engineer, and do hereby

certify that the attached field notes accurately describe the peri-

meter boundary of the said 83.09 acre tract, that said perimeter

description duly closes, and that said 83.09 acre tract of land

lies within Williamson County Municipal Utility District No. One.

WITNESS MY HAND AND SEAL this // // day of December, 1980.

(SEAL)

Registered Professional EngineerRegistration Number

7291 £63

VOL TRACT 111-76.958 ACRES

2-49-3263

Field Notes describing 76.958 acres of land out of and a partof the Elisha Allen 1/4 League, Survey No.2, situated in WilliamsonCounty, Texas, said 76.958 acre tract being more particularlydescribed as be infill of that certain 57.701 acre tract conveyedto Anderson MiirRvlnt Venture by deed of record in Volume 8/fc ,Page»#M2Jof the Williamson County, Texas Deed Records, and a'portionof that certain 32 acre tract of land conveyed to Jimmy Youngquist,Trustee by deed of record in Volume 577, Page 626 of the-WilliamsonCounty, Texas Deed Records, said 76.958 acre tract being morefully described by metes and bounds as follows;

BEGINNING at a steel pin found in the west line of Lot 236,Forest North Estates Phase Two, a subdivision of record in Cabinet"B", Slides 278-281 of the Williamson County, Texas Plat Records,for the most southerly southeast corner of the tract hereindescribed, said point also being the most southerly southeastcorner of said 57.701 acre tract;

THENCE leaving said subdivision and with a south line of thissurvey the following four (4) courses;1. S 70*-50'W 2289.66 feet to a steel pin set at the southwestcorner of said 57.701 acre tract;2. S 70»-49'-SO"W 462.33 feet to a steel pin found;3. S 71'-2l'-42"W 233.76 feet to a steel pin found;4. S 70*-44'-22"H 448.69 feet to a steel pin-found in the curvingeast line of Research Boulevard (U.S. Highway No.183) for thesouthwest corner of the tract herein described, said point beingat a fence corner at the southwest corner of the above said 32acre tract;

THENCE with the curving east line of said .Research Boulevard,along a curve to the left whose Radius is 5829.65 feet, a sub-chord bears N 17*-S7'H a distance of 160.06 feet to a concreteright-of-way marker found at the end of said curve*,

THENCE continue with the east line of said Research BoulevardN 13*-41'w 512.OS feet to a steel pin set at a fence corner for thenorthwest corner of the tract herein described;

at the northwest

THENCE leaving said Research Boulevard and with the north lineof this survey the following five (S) courses;1. N 64*-28'E 1143.87 feet to a steel pin setcorner of the above said 57.701 acre tract;2. N 64«-19'-38"E 372.03 feet to a steel pin set;3. N S4*-07'-34"E 1249.99 feet to a steel pin set;4. N S3*-48'-21"E 667.49 feet to a steel pin set;5. N S4*-06'-18"E 123.63 feet to a steel pin found in the west line

A-5

264

2-49-3264

VOL

of Lot 305, Forest North Estates Phase Three, a. subdivision ofrecord in Cabinet "B", Slides 26*-27 of the Williamson County, TexasPlat Records, for the northeast corner of the tract hereindescribed and the northeast corner of said 57.701 acre tract;

THENCE with the east line of said 57.701 acre tract the followingfour (5) courses;1. S IB^-ST'-IS1^ 698.78 feet to a steel pin found;2. S 19*-SO*-59"E 351.36 feet to a steel pin found;3. S 44*-S6'-23"E 27.08 feet to a steel pin found;4. S IS'-IS'-SS1^ 150.02 feet to a steel pin found at an interiorcorner of Lot 243 of the above s'aid Forest North Estates PhaseThree for the most easterly southeast corner of said 57.701 acretract and the most easterly southeast corner of the tract hereindescribed;

THENCE S S4*-4S'-16"W 28.83 feet to a steel pin found at themost westerly corner of said Lot 253 for an interior corner ofsaid 57.701 acre tract and an interior corner of the tract hereindescribed;

THENCE continue with an. east line of said 57.701 acre tractthe following four (4) courses;1. S 18*-15'-S2"E 80.39 feet to a steel pin found;2. S 18*-39'-33"E 30.07 feet to a steel pin found;3. S 19*-S9'-33"E 30.04 feet to a steel pin found;4. S 20«-25'-33"E'60.78 feet to the place of BEGINNING containing76.958 acres of land.

7291 '265

A-6

vni lt,v»L ^ , M.C . CERTIFICATE

THE STATE OF TEXAS I 2~49~3265

COUNTY OF TRAVIS I '

I, the undersigned, a duly registered professional engineer

under the laws of the State of Texas, do hereby certify that:

(1) I am familiar with and have examined the attached metes

and bounds description of the boundaries of a tract of land within

Williamson County Municipal Utility District No. One containing

76.958 acres, more or less.

(2) In my opinion, the place of beginning in each of the

calls in said description can be located and followed on the ground.

(3) In my opinion, said metes and bounds description duly

closes and said land lies within Williamson County Municipal Utility

District No. One.

,- rWITNESS MY HAND AND SEAL this /? —day of January, 1981.

<&•Registered Professional EngineerRegistration Number

Of

7291 266

EXHIBII_L

RESOLUTIQN

WHEREAS, Section 43.0751 of the Texas LdtarGovemment Codeauthorizes certain municipalities to negotiate and enter into strategicpartnerships with water districts, including municipal utility districtsregarding the timing and terms of annexation "by municipalities of waterdistricts within the extraterritorial jurisdiction of the municipalities; and

WHEREAS, Anderson Mill Municipal Utility District ("District") lieswithin the extraterritorial jurisdiction of Austin, and Austin is considering thefeasibility of annexing the District; and

WHEREAS, Austin desires to initiate negotiations and to enter intoa Strategic Partnership Agreement with the District regarding the terms andconditions of annexation as may be mutually agreeable to Austin and theDistrict under the provisions of Section 43.0751 of the Texas Local

! Government Code; NOW, THEREFORE,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OFAUSTIN:

The City Manager be directed to present a copy of this Resolution tothe District; to proceed to negotiate a Strategic Partnership Agreement withthe District; and to report back to the Council with his recommendationswithin 90 days.

This Resolution shall expire on December 31,1997, unless the Districtadopts a corresponding resolution on or before December 3,1997 as providedin Section 43.0751 of the Texas Local Government Code, or unless theexpiration date is extended by the City.

ADOPTED: October -24. ATTEST: <f LJames E, Aldridge

City Clerk

122

14 HTIUJJ

RESOLUTION NO. 96-1010-01

RESOLUTION AUTHORIZING AND EVIDENCING INTENT OF DISTRICTTO ENTER INTO A STRATEGIC PARTNERSHIP AGREEMENT

WITH THE CITY OF AUSTIN

WHEREAS, Section 43.0751, Texas Local Government Code, authorizes certain water districts,Including municipal utility districts, to negotiate and enter into strategic partnership agreements withmunicipalities regarding the timing and terms of annexation by a municipality of a district that lieswithin the extraterritorial jurisdiction of the municipality; and

WHEREAS, Anderson Mill Municipal Utility District (the "District") lies within theextraterritorial jurisdiction of the City of Austin (Che "City"), and the City u considering the feasibilityof annexing the District and the basis on which this might be done; and

WHEREAS, the Board of Directors of Anderson Mill Municipal Utility District desires to initiatenegotiations and to enter into a strategic partnership agreement with the City of Austin on the terms andconditions of annexation as may be mutually agreed upon by the District and the City as authorized bysaid Section 43.0751; Now, Therefore,

BE IT RESOLVED BY THE BOARD OF DIRECTORS OF ANDERSON MILL MUNICIPALUTTUTY DISTRICT OF WILLIAMSON AND TRAVIS COUNTIES, TEXAS THAT:

Section 1. The matters and facts staled in the preamble to this Resolution are found anddetermined to be true and correct and ate hereby adopted as a part of this Resolution.

Section 2. The Board of Directors of the District hereby expresses and evidences its intent tonegotiate a strategic partnership agreement with the City of Austin, pursuant to said Section 43.0751,

Section 3. The appropriate Officers and representatives of the District, as designated by thePresident of the District, axe hereby authorized and directed to present a copy of this Resolution to theCity and to proceed as provided in Section 43.0751 to negotiate a strategic partnership agreement withthe City. The strategic partnership agreement must be approved by the Board before it becomeseffective as to the District.

Section 4. This Resolution shall expire on September lt 1997, unless the City adopts acorresponding resolution as provided hi said Section 43.0751 on or before said date, or unless theexpiration date is extended by the District

PASSED AND APPROVED this 10th day of October, 1996.

David L/Harper, President

William E. Burke, Treasurer

Andrew T, Kowedy,Asst, Secretary-Treas^rf?~-\

: HOorwnioiEXHIBIT C

EXHIBIT D

Anderson Mill Municipal Utility DistrictAmenities

Parks -Approximately 60 acres of parks and greenbelts, including following features andimprovements:

Seven developed parks and playgroundsTwo junior Olympic size swimming pools and bathhouses for yearround use with heating in the winterFitness center at El Salido PoolEight tennis courtsOne racquetball courtThree sand volleyball courtsOne softball fieldOne basketball courtOne multi-purpose courtSeven practice soccer fieldsThree picnic pavilionsNearly six miles of hike and bike trails

Community Center with kitchen facility ~ available for personal use of residents andneighborhood groups. Also serves as Administration Building for the District.

::ODNU\PCDOCS\AUSTINJ\108024\311919981000:19225-1

\ . + ^ - - -L

AGREEMENT CONCERNING CREATION OF

WILLIAMSON COUNTY MUNICIPAL UTILITY DISTRICT NO. ONE.

ARTICLE I.

PARTIES

This is an agreement between the City of Austin, hereafter called

"City", acting through Dan Davidson, its duly authorized City Manager,

and National Housing Industries, Incorporated, Lumbermen's Investment

Corporation, and Provident Development Company, hereafter called "Owners",

being the holders of legal title to and developers of approximately

729 acres of land to be included in Williamson County Municipal Utility

District No. One, hereafter called "District", which contains approx-*

imately 737 acres of land located in the William Fr amp ton Survey No.

122, Abstract No, ..230, in Williamson County, Texas, and part of which/

lies within the extraterritorial jurisdiction of the City.

ARTICLE II.

CITY CONSENT TO DISTRICT

The Owners have previously filed with the City a request that the

City give its consent to the inclusion of the 737 acres of land identi-

fied in Article I within the District. On the 3O day of

, 1973, the City passed a resolution giving its

consent to the creation of Williamson County Municipal Utility District

No. One over the approximately 737 acres of land identified in Article

I, above. The consent of the City contains numerous terms and condi-

tions under which the District may issue its bonds. Owners agree to

use their best efforts to see that, the District complies with all the

terms and conditions expressed in the consent of the City.

ARTICLE III.

COSTS TO BE PAID BY DISTRICT AND DEVELOPER

A. In the resolution of the City adopted on the *3* Q- day ofJL -- -

\LA jj 3 1973, consenting to the creation of the District, it

EXHIBIT E

is provided that the District may not issue bonds or notes for any pur-

pose other than to:

(1) Purchase, construct, acquire, repair, extend and improve

land, easements, works, improvements, facilities, plants,

equipment, and the appliances necessary to:

(a) provide a water supply for municipal uses, domestic

uses, and commercial uses; and,

(b) to collect, transport, process, dispose of and control

all water-borne domestic, industrial or communal waste,

whether In fluid, solid or composite state; and,

(2) Pay necessary engineering fees and bond issuance expenses

associated with that part of the work described in paragraph

(IX above, which would normally be incurred by the City at the

time of installation under then current City policies if the

area of- the District were within the corporate limits ofy

the City, and were served by facilities provided by the City.

B. The Owners agree to pay, for the benefit of the District, all

costs and expenses associated with the work described in paragraph A,

above, other than those specifically identified and described in para-

graph' A, which could otherwise be paid from proceeds of the issuance of

bonds of the District under the authority of Section 54.016, Texas Water

Code. This includes, without limitation, those organization expenses,

operation expenses during construction, and interest during construc-

tion which are not authorized under paragraph A to be paid from District

bond and note proceeds.

C. The Owners also agree to pay or provide, for the benefit of

the District: • " -

(1) For the initial purchase, construction, acquisition,

extension, and improvement of land, easements, works,

„. improvements, facilities, plants, equipment, and the

appliances reasonably necessary to gather, conduct,

-2-

divert and control local storm water or other local

harmful excesses of water in the District, which facil-

ities shall be constructed in accordance with the City's

design standards and specifications for similar facilities

within the City;

(2) For the payment of all costs and expenses associated with

Che work described in paragraph (1), above, which could

otherwise be paid from proceeds of the sale of bonds of

the District under the authority of Section 54.016, Texas

Water Code, including without limitation organization

expenses, operation expenses during construction, and

interest during construction; and,

(3) For the payment of the approach main charges established .

by the City for making the City water supply available

for use within the area of the District, which charges

shall be in accordance with the policies of the City o£

Austin for providing a water supply outside its city limits.

D. The City and the Owners acknowledge and agree that in granting

its consent to the inclusion of the land identified above in the District,

the City in effect has restricted the purposes for which the District may

issue bonds to the providing of water and sewerage services to the land

area within the District. The parties further recognize and agree thatf- #

nothing in the Resolution of the City giving its consent to the inclu-

sion of Che land identified in Article I within the District, nor in

this or any other agreement, in any way restricts or limits the powers

and authority of the District to operate and maintain the water system,

the sewerage system, drainage facilities, recreational facilities,

solid waste disposaf facilities, or any other systems, facilities, assets

or properties of the District. The District may use funds and assets

from any' lawful sources available to it to provide for such maintenance

and operation. This includes, without In any way limiting the generality

of the foregoing, revenues from any of the systems, facilities, properties

-3-

drid assets of Che District not otherwise committed for the payment of

the bonded indebtedness of the District; maintenance taxes; Loans, gifts,

grants and donations from public or private sources; and revenues from any

other sources lawfully available to the District under the provisions of

Chapter 54, Texas Water Code; provided, however, that no part of any such

expenses of operation and maintenance shall be paid from the proceeds of

bonds issued by the District or from tax or other revenues pledged to the

retirement of the bonded indebtedness of the District.

E. All liabilities, obligations and responsibilities of the Owners

under this Article III shall terminate with respect to all or any portion

of the District which is annexed to the City and as of the date the

annexation is accomplished.

ARTICLE IV.

PREPAYMENT PENALTIES ON BONDS

As a condition precedent to the approval by the City of the issuance

of bonds by the District, Owners agree to deposit in escrow with a bank

located in the City of Austin, Texas, selected by the City, a sufficient

sum of money to provide for the payment of any prepayment penalties or

premiums which may be charged to the City for refunding or prepaying any

of the bonds issued by the District which may be taken over or assumed

by the City, and also to pay reasonable charges to the bank for its

services as escrow agent. The parties understand and agree that none*

of the funds so deposited shall be funds of or furnished by the District,

but shall be funds otherwise available to Owners. The escrow agreement

shall set forth the schedule on the basis of which the prepayment pen-

alties or premiums may become due. The parties agree that the escrow

agent shall be authorized and directed to invest the escrow funds

in government obligations,.insured certificates of deposit, or other

equally secure obligations or securities approved by the City, with

redemption dates approved by the City. The interest or other income

from the escrow funds shall be paid'to Owners as it is earned and

-4-

received by Che escrow agent. The City may draw against the escrow de-

posit as any prepayment penalties or premiums are required to be paid

until all of the bonds against which the escrow deposit has been made

have been redeemed in full, or until the period for payment of prepay-

ment: penalties or premiums has passed, whichever first occurs. In addi-

tion, from time to time, as the liabilities and potential charges against

the escrow deposit are reduced by the passage of time and the redemption

by the District of any of the outstanding bonds to which the escrow

deposit applies, the escrow agent shall release and pay the unobligated

funds to Owners. At the end of the term for which the escrow deposit

is made, any balance then remaining in the escrow account, after providing

for all prepayment penalties and premiums which may be charged to the

City and the expenses of administering the escrow deposit, shall be

refunded to Owners by the escrow agent.

/"* ' " ARTICLE V.

GREEN BELT AND PARK .LANDS

The Owners covenant and agree that they shall convey or cause to be

conveyed as a gift or donation to the District approximately fifty-five

C55) acres of land within the boundaries of the District for green belt,

park and recreational purposes. The tracts of land to be conveyed shall

correspond generally to the lands designated for green belt, park and

recreational purposes as shown on the land use plan in the preliminaryy

engineering report for the District on file with the City, or as may be

designated more specifically on the City-approved master plan for the

area in effect at the time the conveyances are made. The conveyances

to the District shall be made progressively as subdivision plats for

areas within the District are submitted to and approved by the City.

The tracts so conveyed shall consist of the green belt, park and re-

creational lands which naturally and directly relate to the portions

of the District then being submitted for plat approval, and as may be

mutually agreed upon by the City and the Owners, the objective being

to provide for a logical and systematic development of the green belt,

-5-

park and recreational lands within the District, consistent with the

overall development and growth of the area within the District. The

conveyances of the green belt, park and recreational lands shall pro-

vide that title to those lands shall pass to the City for park and

recreational purposes at such time as the City annexes the lands.

ARTICLE VI.

PLAT APPROVAL

The Owners agree that prior to the sale of any subdivided lot or

parcel of land within the limits of the District, the person or persons

owning or developing the land will be required to obtain the approval

of the City of a plat or plats which will be duly recorded in the map

and plat records of Williamson County, Texas, and will otherwise be.

required to comply with the rules and regulations of the City.

/'" ' "ARTICLE VH.

SEWERAGE SYSTEM

A. The Owners and the City agree that the City may, at its option

and at/any time, contract with the Owners for the City to operate, manage

an'd maintain the sewerage system to be constructed in the land within

the District. If the City so elects, the Owners agree to use their best

efforts to assure that the District contracts with the City to operate,

manage and maintain the sewerage system for and on behalf of the District#

after the District acquires title to the "sewerage system. The City shall

carry out the operation, management and maintenance of the sewerage sys-

tem in accordance with the operation, maintenance and management prac-

tices followed by the City in the operation of its own sewerage system.

The City shall be authorized to handle the billing of the customers

served by the sewerage system, and to do and perform any and every other

thing necessary or incident to the operation, maintenance and management

of an efficient sewerage system. The City shall have the authority to

-6-

disconnect and discontinue the sewerage service, the water service, the

electrical utility service, or any other service of any customers con-

nected to the sewerage system who are delinquent in their sewerage service

bills or who are in violation of the regulations and policies applicable

to the sewerage system. The City shall receive for its services fees and

other compensation agreed upon by the owner of the sewerage system and

the City. The fees and compensation shall be commensurate with the cost

of rendering the services, and shall be comparable to the charges made

by the City for similar services provided under similar circumstances.

B. In providing sewerage operation, management and maintenance

services, the City is engaging in a governmental function and does not

hereby, or through any contract pursuant hereto, assume any liability

to any party hereto, their heirs, successors, administrators, executors•• • . « • , %

or assigns, or to any party receiving the benefit of such services,

which liability would exceed that to parties within the City of Austin.

ARTICLE VIII.

WATER SYSTEM

By separate agreement, the City and the Owners are entering into a

'contract for the City to provide the water supply for use within the

area of the District and to operate, manage and maintain the water sys-

tem. Reference is hereby made to the separate agreement for its terms> ;

%

and provisions and for all other purposes.

„ . ARTICLE IX.

STANDARDS FOR FACILITIES

The Owners agree that all public facilities they construct"jin the Dis-

trict, including without limitation streets, sidewalks, water supply sys-

tems, sewerage systems, drainage systems, and park and recreation equip-

ment and improvements, shall be constructed in accordance with the City's

design standards and specifications for similar facilities within the City.

-7-

The City shall have che right at its option to approve the plans and

specifications for such facilities prior to their construction.

ARTICLE X.

DISTRICT TO ADOPT RESOLUTION AND AGREEMENTS WITH OWNERS

The Owners agree Co use their best efforts to assure that at the

time the District becomes operational, the Board of Directors of the

District shall:

(1) Adopt a resolution or take some other official action

agreeing Co the terms and conditions contained in the resolution of

the City Council of the City of Austin adopted on the 3£> day of

/TILA^UU/JL ' , 1973, in which the City gives its consent tofl

the inclusion of the land identified above within the District;*

(2) Adopt a resolution or take some other official action rati-

fying, affirming, .and accepting the benefits and agreeing to the terms,

conditions and requirements of this Agreement;

(3) Adopt a resolution or take some other official action agreeing

to and adopting the terms, conditions, and requirements of the separate

water supply agreement to be entered into between the City and the

Developers, as referred to in Article IX of this Agreement; and,

(4) Enter into such other or additional contracts or agreements as

may be reasonably required to carry out the purposes and intent of the

resolution and agreements referred to in paragraphs (1), (2) and (3)

above.

ARTICLE XI.

THIRD PARTY BENEFICIARY

The parties hereto agree that the District is a third-party bene-

ficiary of the terms and provisions of this Agreement. When the District

ratifies, affirms and accepts the benefits and agrees to the terms, con-

ditions and requirements of this Agreement, as provided In Article X,

above, the City, the District and the Owners may each and all mutually

insist on and enforce compliance by the other parties with the terms,

conditions and requirements of this Agreement.

ARTICLE XII

ASSIGNMENT OF CONTRACT

Any of the Owners from time to time may transfer, convey or assign

this Agreement with respect to all or any part of the land owned by

such Owner, and the assignee'or assignees shall be bound by this Agree-

ment as provided in Article XIV. Upon prior approval by the City Coun-

cil of the City, of the assignee or assignees, and only upon the con-

dition that the assignee or assignees assume the liabilities, respon-

sibilities and obligations of this Agreement, the Owner making such

assignment shall be released from the liabilities, responsibilities

and obligations under this Agreement with respect to the land involved

In the assignment or assignments, or as may be otherwise approved by-'.... , T,

the City Council.

ARTICLE XIII

TERMINATION OF AGREEMENT

This Agreement shall terminate at the time all of the land within

th'e District has been annexed to the City, or, with respect to each

segment of water, wastcwater and sewerage, and/or drainage facilities,

at the time the facilities have been installed and constructed in accor-

dance with plans and specifications approved by the City, as provided

in this Agreement, whichever event first occurs; provided that the

provisions of Article IV concerning prepayment of bonds shall continue '

beyond such date with respect to District bonds theretofore issued

until such time as the prepayment penalty period on any such thereto-

fore issued bonds has expired and the escrow requirements have been fully

executed.

ARTICLE XIV.

AGREEMENT BINDING ON SUCCESSORS

This contract and the rights., privileges, duties and obligations

hereunder inure to, are for the benefit of, and are binding on the

-9-

parties hereto, and their respective heirs, successors, administrators,

executors and assigns.

EXECUTED Chis 1st day of November , 1973.

CITY OF AUSTIN

ATTEST:

City Clerk

ATTEST:

/ V I IA^ f\-*XLAa \*fSecretary

ATTEST:

;Secretary

-jj, -•

, City Manager

NATIONAL HOUSING INDUSTRIES,INCORPORATED

LUMBERMEN'S INVESTMENT CORPORATION

PROVIDENT DEVELOPMENT COMPANY

ATTEST;

Secretary

By.

R E S O L U T I O N

. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF AUSTIN:i-

; That Dan H. Davidson, City Manager of the City of Austin, be and

he Is hereby authorized to execute an agreement between the City of Austin

:• and National Housing Industries, Inc., Lumberman1* Investment Corporation

,• and Provident Development Company, concerning creation of Williamson County

Municipal Utility District No. One, in accordance with the agreement attached

: hereto; and,

!•

|j BE IT FURTHER RESOLVED N THE CITY COUNCIL OF THE CITY OF AUSTIN:

iI;j; That the City Clerk Is hereby directed to file a copy of saidI1

!( agreement in the permanent records of her office without recordatlon in

the Minutes of the City Council.

ADOPTED

30AUG73DLWjsh

1973. ATTEST

ST. GABRIEL CATHOLIC SCHOOL. SUBDIVISION

AUSTIN CIVILENGINEERIMG.INC.

•UCBUIML. PJ.«« M H tU, t*

MTM

EXHIBIT B

-t-'i -+i.—J-" r- -F=Z—*'73\ . ^^»

SAINT GABRIEL-SCATHOLIC SCHOOL

WIMBERLY LANE

AUSTIN CIVILENGINEERING.INC.

EXHIBIT C

SAINT GABRIEL'SCATHOLIC SCHOOL

WfMBERLY LANE

AUSTIN CIVILENGINEERING.INC.

EXHIBIT D

SAINT GABRIEL'SCATHOLIC SCHOOL

WIMBERLY LANE

AUSTIN CIVILENGINEERING.INC.

zo

Uco

QP

i§LU O

Q.WJ

I

LU IB °*jh aSIS «-as! <*§ ".15 .a <qi» *a nsaN^I fe

EXHIBIT G

Limited Purpose Annexation Cases C7L-98-004, C7L-98-005, C7L-98-006,C7L-98-007

Anderson Mill Commercial AreasLimited Purpose Annexation Planning Study

Background

The proposed limited purpose annexations are being conducted pursuant to a StrategicPartnership Agreement ("SPA") between the City of Austin ("the City") and AndersonMill MUD ("the District"). The SPA agreement and the proposed limited purposeannexations are undertaken in accordance with Section 43.0751 of the Texas LocalGovernment Code.

Area Descriptions

Four areas are proposed for limited purpose annexation:

• C7L-98-004- Lake Creek Parkway Commercial Area. This area isapproximately 33 acres of commercial property on the west side of US 183extending from the existing City limits at the Pecan Park Subdivisionsouthwards to Hymeadow Drive. A map of the area is attached to thisplanning study.

• C7L-98-Q05- Woodland Hills Village Commercial Area. This area isapproximately one acre of commercial property located adjacent to theintersection of Woodland Village Drive and US 183. A map of the area isattached to this planning study.

• C7L-98-006- Millwright Parkway Commercial Area. This area isapproximately one acre of commercial property located at the northwestcorner of the intersection of Millwright Parkway and Anderson Mill Road. Amap of the area is attached to this planning study.

• C7L-98-007- Pecan Creek Parkway Commercial Area. This area isapproximately six acres of commercial property located at the northeast cornerof the intersection of Pecan Creek Parkway and Anderson Mill Road. A mapof the area is attached to this planning study.

Projected Ten Year Development with and Without Annexation

The proposed annexation areas are developed commercial areas. It is anticipated that theareas will continue as commercial sites irrespective of their annexation status.

Anderson Mill Commercial AreasPurpose Annexation StudyNovember 16, 1998Page 2 of 3

Issues Supporting Annexation

The proposed limited purpose annexation facilitates implementation of proposed SPAbetween the District and the City.

Public Benefit from the Annexation

The proposed limited purpose annexation facilitates implementation of the proposed SPAbetween the District and the City. The SPA provides for the phased full purposeannexation of the District which will benefit residents, landowners, and businesses withinthe District and the City.

The limited purpose annexation areas are commercial properties and do not have aresidential population.

The Economic and Environmental Impact of the Proposed Annexation

The proposed limited purpose annexation will work to the economic advantage ofresidents, landowners and businesses within the areas proposed for limited purposeannexation by facilitating implementation of the proposed SPA between the District andthe phased full purpose annexation of the District.

Prior to the full purpose annexation of the District, the limited purpose annexation willbenefit residents, landowners and businesses through the establishment of land usecontrols and building standards not otherwise available.

The limited purpose annexation areas are commercial properties and do not have aresidential population.

Existing uses within the annexation areas will become legal non-conforming uses inaccordance with Division 6 (Non-conforming Use Regulations) of the City's LandDevelopment Code ("the Code"). Division 6 of the Code is attached to this Study.

Given that virtually all other commercial areas in the vicinity of the proposed annexationareas are already in the City, the imposition of City sales tax is not expected to have asignificant impact on businesses in the area or on consumers.

The limited purpose annexation will protect the local environment by ensuring that futuredevelopment will meet certain minimum standards.

The City will not impose ad valorem taxes during the period of limited purposeannexation. The City will, however, impose sales tax, as authorized by Section 43.0751of the Local Government Code.

Proposed Zoning for the Area

The area will be zoned in accordance with the procedures required by state law andChapter 13-1 of the Code.

Anderson Mill Commercial AreasPurpose Annexation StudyNovember 16, 1998Page 3 of 3

From the effective date of the limited purpose annexation until the property is zoned, thearea will be treated for development purposes, in accordance with Section 13-2-26(Interim Zoning Classification of Annexed Land) of the Code.

Section 13-2-26 and Division 6 of the Code are attached to this study.

Comments regarding the proposed zoning will be considered at the public hearings forthe proposed limited purpose annexation.

Regulatory Plan

Development Regulations

Annexation of the areas for the limited purposes of planning, zoning, health, and safetywill extend the full range of City regulatory authority regarding development,construction, land use, and environmental quality to the areas. This authority includes theapplication of all regulations pertaining to planning, zoning, health and safety, includingbut not limited to, regulations within the City's Land Development Code and HealthCode and related technical manuals, and all rules adopted pursuant thereto.

Future Full Purpose Annexation

The proposed limited purpose annexation areas will be included within the City's fullpurpose jurisdiction in accordance with the terms of the SPA.