Joint Finance Committee & Planning, Engineering and Construction Committee Meeting January 3, 2006 Mr.

Young commented that the USACE is looking to investigate what the canals’ height will be before the S&WB begins pumping. This will be an elevation that everybody can be satisfied with, and the USACE will either make modifications to the levee or make no modifications to the levee. Along the entire system of levees, the USACE is looking to insure that the Orleans Levee District and the S&WB have sufficient space to maintain and inspect the levees. Probably the trees along the 17th Street Canal will be cleared from the levees so that trucks during inspection can pass through. The Orleans Avenue Canal area is basically cleared. On London the levee toe is basically on the property line on either side, so the USACE is probably looking to take possibly 10 ft. to 15 ft. of land in order to allow inspection throughout the area. This is a recommendation from the USACE’s forensic group to allow the OLD and S&WB the ability to inspect the levees and keep them functional. Mrs. Sandra Miller, a Bellaire Street resident, asked for a clarification from Mr. Young concerning what will be done to homes along Bellaire Street. Many of the residents gutted their homes but are waiting to see if the USACE would be taking any of the property before they begin renovations. Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 7 Mr. Young replied, each levee along the canals will be looked at differently. There are different problems such as seepage and stability at different locations and different areas. Representatives from St. Louis, St. Paul and New Orleans and multitudes of AE’s are looking at the canals. This is a situation that involves every section of the levee system. The USACE has ideas about what they want to do in order to have flood protection by June 1. Chairman Saizan asked Mr. Young to explain the process should the USACE decide to obtain square footage from someone’s property? Mr. Young explained that if the USACE deems its necessary for building larger breach closures, the USACE would go out with plans and specs for advertisement. During that time, the USACE will ask the Mayor to assist in obtaining property. \Basically, it is taking the property and negotiating at a later time in order for the USACE to continue with their schedule. It is based on what footprint is needed for the levee, T-Wall or whatever type of flood protection will be obtained. Most cases, the USACE acquire additional land so that they can provide room for inspection and maintenance.

Joint Finance Committee & Planning, Engineering and Construction Committee Meeting January 3, 2006 at 1:00 p.m. Second Floor Hall Lake Vista Community Center 6500 Spanish Fort Boulevard New Orleans, Louisiana ___________________________________________________________ PRESENT: Planning, Engineering and Construction Committee: Chairperson Commissioner Darrel J. Saizan, Jr. Commissioner Allen H. Borne, Jr., Member Acting President Michael P. McCrossen, Ex-Officio Member Commissioner Dan S. Foley Commissioner Davis R. Voelker Finance Committee: Vice Chairperson Commissioner Allen H. Borne, Jr. Commissioner Dan S. Foley, Member Acting President Michael P. McCrossen, Ex-Officio Member Commissioner Darrel J. Saizan, Jr. Commissioner David R. Voelker FURTHERMORE PRESENT: Stevan G. Spencer, OLD Gerard Gillen, OLD Cornelia Ullman, OLD Glenda Boudreaux, OLD Bob Maureau, OLD Cynthia Taylor, OLD Carol Kiefer, OLD Nina Marchand, OLD Jim Bollinger, OLD Rick Loggins, OLD Craig Boudreaux, OLD Donald Booth, OLD Joel Jenkinson, OLD Dawn Wagener, OLD Gary Majors, Bell South Colleen Majors, Bell South Tom Long Frank Donze, Times Picayune Joe Gyan, The Advocate Kathy Finn, Big New Orleans Addie Fanguy, Million Airs Bruce White, Coconut Beach Volleyball Complex Frederick Young, USACE Ray Landiche, Developer for Wren St. Frank Milanese, Esq. Gerard Metzger, Esq. Wade Webster, Middleberg, Riddle & Gianna Albert Pappalardo, OLD Real Estate Consultant Donald Mitchell, Lake Vista Property Owners Association Holly Callia, Lake Vista Property Owners Association Carliss Knesey, Hancock Bank Colin Healuna, Hancock Bank Glenn Carter Pamela Nucciard Steve Schuster Sandra Miller, 5414 Bellaire St.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 2 Hamid Alizadeh, Shaw Coastal, Inc. Ken Beler, Wren St. Developer Mark Marzoni ________________________________________________________________ The Joint Finance Committee and Planning, Engineering and Construction Committee meeting was called to order at 1:17 p.m. by Acting President McCrossen, who recommended that Agenda Item “B” be discussed first, and no objection was offered. B. Wren Street Multi-Family Development

Mr. Wade Webster stated he was representing Mr. Ray Landiche, the developer of the Wren Street property. He advised he gave a presentation last month concerning this project and asked whether there was any opposition to this request, stating his clients were present to address any concerns. Mr. Stevan Spencer, OLD Chief Engineer, reported Mr. Webster was provided a letter addressing four different issues that required additional information. Mr. Webster provided that information just a few minutes prior to this meeting, and Mr. Spencer stated he did not have enough time to review that information. The Lake Vista Property Owners Association (LVPOA) had previously reviewed the concept, but were also requiring information similar to what the District is requesting. The District is requesting final plans and specifications for the project. Information, including the floor plan, foundation and elevation, showing four floors, was provided, however, this information must be reviewed. Mr. Spencer advised representatives of the LVPOA were present today to express their concerns to the Committee. Mr. Webster explained there are building restrictions in the title to this property, and this particular property is unlike any other lot in Lake Vista and receives different treatment under the building restrictions. The only restrictions are that the proposed building meets minimum setback requirements from the property line, and that the footprint does not take up too large a percentage of the entire lot. The requirements also require it meets aesthetic and visual standards. Mr. Webster mentioned that the plans and specifications that were submitted contained everything needed to determine that this project has satisfied the minimum setback and the percentage of the footprint requirements. He felt everything that has been submitted is sufficient for the Board to make a decision on whether the developer is complying with the building restrictions. Mr. Webster apologized to Mr. Spencer for sending the information he requested to the incorrect website address. Mr. Webster further saw no reason not to proceed, adding that the developer is only requesting a letter of no objection for the project. He stated, in conclusion, the entire project conforms to the applicable zoning requirements of the City and the other building restrictions. Mr. Spencer introduced Mrs. Holly Callia, President of the Lake Vista Property Owners Association (LVPOA). Mrs. Callia recommended, on behalf of the LVPOA, that the District not take a position until plans and specifications have been provided and reviewed. She explained every individual homeowner who builds in the neighborhood is required to provide plans and specs for full review. She reiterated Mr. Spencer had only recently received the additional information he had requested and was unable to review this information as yet. This is a big project, and the LVPOA is not objecting to the project, but it is necessary for the LVPOA to make an

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 3 adequate review and the Levee District to assure the property is built in conformance with the title restrictions. Commissioner Borne asked Mrs. Callia had she been provided with the same plans and specs as Mr. Spencer. Mrs. Callia replied, she had not seen the documents provided to the District to confirm that they were the same, but she believed they were based upon her discussion with the developer. Mrs. Callia added, the LVPOA has not received anything new from the developer since mid August. Mr. Spencer advised he had received a copy of plans and specs at the December 5, 2005 Planning, Engineering and Construction Committee meeting, which were distributed to certain individuals, however he was unable to review them at that time. Last week another copy was provided by Mr. Webster and a copy was made available for pick up by the LVPOA. Mrs. Callia asked Mr. Spencer would he consider what he had to be plans and specs, because to her understanding, plans and specs had not been drawn. What had been presented to the LVPOA was a conceptual design. Mr. Spencer concurred, it was more of a conceptual design. Mr. Webster agreed that detailed plans and specs have not been completed or furnished. He explained, this particular lot has never been a residential lot, and there is no requirement for that type of detail. The developers are complying with the building restrictions as written and all of the terms that are applicable to this particular lot. Commissioner Borne asked when will the plans and specs be provided? Mr. Webster replied the plans and specs were not drawn up because it is a huge expense for these two individuals, which they could not afford to undertake and not have the project materialize. He reiterated, everything in the design meets the building restrictions; that is, the setback and the footprint. Mr. Webster introduced the project developer Mr. Ken Beler. Mr. Beler explained all of the information provided to the District was designed and developed with input from Wren Street residents, the LVPOA and the District, as to what would be acceptable, and they have worked with a respected architectural firm, Mathes Brierre, to develop conceptual plans and specifications to move this project forward. Mr. Beler stated presently they do not have detailed plans and specs, which will be required when they go to the City to meet the City’s building codes. A lot of detail was presented at the LVPOA meeting, showing north, south, east and west elevations, floor plans and square footages, site plans and where the building will be located on the site. This project was well received at that meeting, and he felt the project met the technical and specific requirements of the building restrictions and hoped that the Committee would consider the information that was provided. Acting President McCrossen asked Mr. Spencer was he privileged to all of the details outlined in Mr. Beler’s last comments? Mr. Spencer replied, yes; the District had the drawings that were previously provided and the information provided to the LVPOA regarding elevations and the site plan. Mr. Spencer stated he wanted to assure there were

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 4 no changes to the last submittals and would like to get a set of the plans and specs to make sure that is what they are proposing to construct. Mr. Albert Pappalardo, OLD Real Estate Consultant, commented that he had not seen what was recently presently to Mr. Spencer, and he felt Mr. Spencer needed more time to review the recent information. At last month’s Committee meeting, he received a package of the presented materials. Obviously, this condominium project is allowed in the neighborhood and is not illegal or outside of the permitted zoning usage. It is up to the Engineering Department to determine whether it conforms with the Lake Vista Building Restrictions. A motion was offered by Commissioner Borne, and seconded by Commissioner Foley, to defer this matter until next month’s meeting in order to give Mr. Spencer and staff time to review the newly submitted documents and report back to the Committee with a decision. Chairman Saizan requested Mr. Pappalardo review the documents along with Mr. Spencer and report their recommendation. Commissioner Foley stated the developers want to obtain an approval without submitting details specifications and drawings, and the LVPOA wants to see detailed specifications and drawings before they give their consent, or will object to what is taking place. He felt it would be worth while for the parties to try to resolve that impasse The Board wants to work with the neighbors and do what is right by the developers, and, hopefully, within the next 30 days that impasse can be resolved, otherwise, the Committee would be faced with the same presentations, debate and conflicts. There were no further comments or questions, therefore, Acting President McCrossen called for a vote on the motion to defer the matter to next month’s Committee meeting, which was unanimously adopted. A request was made by Mr. Spencer that Item “D” be addressed next, and there was no objection. D. Bell South Servitudes

Mr. Spencer reported Mr. Gary Majors of Bell South presented a proposal in regards to new boxes for fiber optic cables in the lakefront park areas. Bell South has requested the temporary site on Beryl Street be made a permanent site. Also, approximately two years ago, the Levee Board had approved a small building site near the Robert E. Lee Shopping Center, and Bell South is interesting in relocating this site to a nearby area. Mr. Gary Majors outlined Bell South’s proposal; first, the site at 7316 Beryl Street was previously a temporary site (50 x 50) and Bell South is requesting it be a permanent site (30 x 30); the second site is in Boreas Park on Frankfort Street (30 x 30); the third site is on Lark Street near UNO (30 x 30); and the fourth site, which is questionable, is at the West End Tennis Court on Lakeshore Drive, however, in discussing this site with Mr. Pappalardo, they were not sure of the Tennis Club’s lease requirements. Also, approximately two years ago the Board had approved a site at the entrance of the Orleans Marina (near the Robert E. Lee Shopping Center), but due to several issues construction was delayed, and Bell South is now requesting that site be relocated.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 5 Acting President McCrossen asked for staff’s recommendation, and Mr. Spencer advised all of the prospective sites were reviewed and recommended approval. Bell South is trying to keep the sites away from public view so as not to interfere with the use of the areas and wants to install privacy fences. Mr. Pappalardo commented when he was informed of this request by email, his immediate concern was the location at the West End Tennis Court, because, first, it was close to the hurricane protection levee, and second, he thought the property shown on the graphic fell within a land lease with the owner of the Tennis Club. He recommended Legal concurrence with respect to whether the Board could allow a servitude on a tenant’s leasehold, and that the Engineering Department confirm that this location would not be a problem in the event that earthen levee must be raised. He concurred with Mr. Major, with only that one exception. He stated Mr. Major’s offer of $25,000 for each servitude is reasonable and recommended the servitudes be granted, subject to the concurrence from Legal and the Engineering Department on the West End Tennis Court location. Commissioner Borne asked had Bell South looked at alternate sites for the tennis court servitude, and Mr. Major replied they have looked in that area, but most of the property is private property, and the condo residents do not want that type of structure on their property. Mr. Major added, if this doesn’t go through, Bell South will continue looking for another location for the site. Commissioner Foley indicated he did not want to incur attorney’s fees if the OLD has not reserved the right in the lease to grant a servitude, and suggested perhaps the lessee be compensated. Also, the Engineering Department needs to determine from an engineering standpoint whether this may affect the integrity of the levee. Mr. Pappalardo concurred with Commissioner Foley, and explained the District is currently in litigation on this same leasehold on the issue of a servitude of passage by an adjoining property owner, and to his understanding, this mater is before the court at this time. Commissioner Foley offered a motion to recommended the Board grant all of the servitudes requested, except for the one located at the West End Tennis Court. Commissioner Saizan asked, not only as a homeowner, but also on behalf of the educational institutions and businesses trying to come back to the neighborhood, how quickly could the buildings be constructed and telephone service provided in the lakefront area? Mr. Major replied he did not know, but Bell South is ready to move forward, and that probably within 60 days from the time of approval construction will be taking place. He explained during the hurricane salty floodwater came in and sat over the copper wires and there may be intermittence service through the wires; therefore, Bell South is trying to replace all of the copper with fiber optic. There were no further comments, therefore, the motion offered by Commissioner Foley, seconded by Commissioner Borne, was adopted. A. Presentation by USACE on Task Force Guardian

Mr. Frederick Young, Project Manager with the USACE’s Task Force Guardian, reported on the on-going schedule. In the Inner Harbor Navigation

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 6 Canal area, there are a total of seven contracts, five of which are underway and are 40% completed. Two contracts should be advertised and awarded within the next few weeks. One of the projects is the floodwall repair on the east side of the canal, and the second contract is north of Benefit St. to Hwy. 90. In New Orleans East, all contracts are underway and a majority of the projects are 40% to 50% complete. The contracts range from the earthen contracts along Lake Pontchartrain to the T-Walls along the back levees near the GIWW. One contract left to be award is the scour repair along the Michoud area. In regards to the Orleans East Bank, the initial repairs were done on all three breaches: 17th Street Canal, London Avenue Canal near the Robert E. Lee Bridge and the Mirabeau Avenue Bridge. Within the next two weeks, the final phases of those repairs will go out for advertisement. Presently, all canals are being reviewed for stability and the USACE is working with the Sewerage and Water Board (S&WB) to see at what elevation the canal will be acceptable for pumping water into the lake. Presently, the USACE is proposing to place a temporary structure in each of the canals--Orleans, London and 17th St. Canal--to get through the upcoming hurricane season. These structures will possibly be supplemented with pumps in order to help facilitate removal of rainwater. Mr. Young explained the structures that will be placed by June 1, 2006. Piles will be driven and modular units will be slid onto the piles. Gates will be provided, with the gates’ height equivalent to the lakefront levees. A majority of the time the water that is pumped out of the city is pumped against a surge. Those gates will be closed during a hurricane event to stop the surge from coming down the canals. The pumps will be pumping either over or through the temporary structure. Mr. Young commented that the USACE is looking to investigate what the canals’ height will be before the S&WB begins pumping. This will be an elevation that everybody can be satisfied with, and the USACE will either make modifications to the levee or make no modifications to the levee. Along the entire system of levees, the USACE is looking to insure that the Orleans Levee District and the S&WB have sufficient space to maintain and inspect the levees. Probably the trees along the 17th Street Canal will be cleared from the levees so that trucks during inspection can pass through. The Orleans Avenue Canal area is basically cleared. On London the levee toe is basically on the property line on either side, so the USACE is probably looking to take possibly 10 ft. to 15 ft. of land in order to allow inspection throughout the area. This is a recommendation from the USACE’s forensic group to allow the OLD and S&WB the ability to inspect the levees and keep them functional. Acting President McCrossen asked Mr. Young is the USACE waiting for the final dollar amount and authorization from Congress for the pumping station? Mr. Young replied he is not sure what came from the Conference Committee, but they have been provided enough money to rehab the levees. Acting President McCrossen thanked Mr. Young for his presentation and asked the public if they have any questions or comments. Mrs. Sandra Miller, a Bellaire Street resident, asked for a clarification from Mr. Young concerning what will be done to homes along Bellaire Street. Many of the residents gutted their homes but are waiting to see if the USACE would be taking any of the property before they begin renovations.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 7 Mr. Young replied, each levee along the canals will be looked at differently. There are different problems such as seepage and stability at different locations and different areas. Representatives from St. Louis, St. Paul and New Orleans and multitudes of AE’s are looking at the canals. This is a situation that involves every section of the levee system. The USACE has ideas about what they want to do in order to have flood protection by June 1. Chairman Saizan asked Mr. Young to explain the process should the USACE decide to obtain square footage from someone’s property? Mr. Young explained that if the USACE deems its necessary for building larger breach closures, the USACE would go out with plans and specs for advertisement. During that time, the USACE will ask the Mayor to assist in obtaining property. \Basically, it is taking the property and negotiating at a later time in order for the USACE to continue with their schedule. It is based on what footprint is needed for the levee, T-Wall or whatever type of flood protection will be obtained. Most cases, the USACE acquire additional land so that they can provide room for inspection and maintenance. Acting President McCrossen stated, basically, the USACE is looking for a master plan from all the interested parties. Mr. Young replied, it may be presented by the end of this month. He had to get with the basic players such as the Sewerage and Water Board (S&WB), Orleans Levee District (OLD), LA Department of Transportation and Development (LADOTD), East Jefferson Levee District (EJLD) and the East Jefferson Drainage Department (EJDD) for the 17th Street Canal. The London and Orleans Avenue Canals basic players will be the S&WB, LADOTD and OLD. Acting President McCrossen asked were there any other questions? Mr. Bruce White, representing Coconut Beach, reported that one drain that drains water from the West End area has been covered with debris and water since the contractor repaired the levee. He and others working in the area have tried to find the drain, but have been unsuccessful. This area has been underwater since the hurricane, and he requested assistance in locating the drain. Acting President McCrossen thanked Mr. White for bringing the matter to the Committee’s attention and advised the OLD will coordinate an effort to rectify the situation through its Engineering Department, and would inform Mr. White of the outcome. F. Senator Ted Hickey Bridge Study

Mr. Spencer indicated that a proposal was received from a traffic expert to determine what can be done to increase the safety of the bridge. Acting President McCrossen added, there have been some accidents in the past on the Sen. Ted Hickey Bridge and the OLD wants to do its due diligence in evaluating the structure. Mr. Spencer added, the District requested a proposal on the bridge study and the cost is $10,800. Acting President McCrossen asked is there currently an increase of traffic on the bridge?

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 8

Mr. Hearn replied, not like pre-Katrina. Commissioner Foley asked whether this was an engineering study that could be conducted by LADOTD? Mr. Spencer responded, LADOTD was requested to do the study, but since the Orleans Levee District is not a State agency, LADOTD could not do it. In the past, LADOTD had provided the OLD with a traffic count. Acting President McCrossen asked whether the insurance carrier could perform a review of the bridge, and Mr. Spender responded he did not think so. Commissioner Foley asked whether the bridge was imposed on the District by the State, and Chairman Saizan explained the State took responsibility for construction of the Leon C. Simon extension to the bridge. Mr. Spencer further explained the Sen. Ted Hickey Bridge was built in 1967 by the Port of New Orleans, City of New Orleans and Orleans Levee District. The Port relinquished its rights, and now the Levee District is left to maintain it. Commissioner Borne asked Mr. Spencer is this study to improve the safety of the bridge? Mr. Spencer replied, in the long range we are looking at problems that can be addressed through signage or physical makeup of the bridge. Commissioner Borne asked Mr. Spencer did he recommend the study? Mr. Spencer replied, traffic had slowed down after Hurricane Katrina, but this will still need to be addressed for when traffic increases in the future. Chairman Saizan stated he would like to make sure signs are placed on the bridge to warn people of the conditions of the bridge on both sides. Acting President McCrossen advised the District has tried to give the bridge to LADOTD, but was unsuccessful. Commissioner Foley offered a motion to recommend Board approval of the study, which was seconded by Commissioner Voelker, and unanimously adopted. C. Miscellaneous Information

Mr. Spencer reported the Association of Levee Boards of Louisiana is having its 65th annual meeting at the Wyndham New Orleans Hotel on January 19 – 20, 2006. Any Commissioners interested in attending should contact Mr. Hearn’s office for registration. Mr. Spencer advised a memo was included in the agenda packet that explained the status of on-going projects, including those discussed at the December 21, 2005 Board Meeting. As a result of last month’s Board Meeting, Mr. Gerry Gillen, Assistant Chief Engineer, reported projects have been advertised and plans and specs are ready for pick up at OLD’s Baton Rouge office. The bids are due on January 27, 2006, and the lowest responsive bidder will be presented at the February 2006 Board Meeting for award.

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E.

Lakefront Airport RFQ For Storm Damages

Mr. Spencer stated Mr. Randy Taylor, Director of Aviation, was unable to attend today’s meeting. On behalf of Mr. Taylor, Mr. Gerry Gillen, Assistant Chief Engineer, reported that after the October 2005 Board meeting, the District went forward with the application process and also advertised an RFQ for an engineering consultant to design the projects proposed by the FAA, with responses to the RFQ due on January 5, 2006. Traditionally, in-house staff reviews the RFQ responses and produces a short list. The FAA Circular states three to five contractors should be on the short list. In the past, the short list was brought to the Committee, and the Committee designated an ad hoc committee to review the short list and make its selection. The FAA revised its circular, effective September 30, 2005, to include more extensive procedures. The Board can continue to use the ad hoc committee or allow staff to recommend the final award. Mr. Gillen explained, in the past, the procedure was that a short list was prepared, suggested FAA selection criteria applied, the selection made and then an award made at the Board meeting. A copy of the flow sheet with the revised process was included in the agenda package. The process remains the same until the pre-selection list is developed by the staff. The FAA is now requiring the list of consultants be provided a Request For Proposal with additional criterias that they must meet. These consultants, with this additional information, resubmit their proposals to a committee or the Board, whichever is the desire of the Board, where they will be re-ranked and fee negotiations immediately commenced. The fees are negotiated and the number one ranked proposal is sent to the FAA for approval, and once approved by the FAA can then be submitted to the Board for its approval. The contract is not to be awarded until the grant is approved. The FAA wants in its possession the selected contractor, which will take a minimum of 60 days, and after that the grant is sent to the District. Chairman Saizan requested that Commissioner Green, who was not present at today’s meeting, is sent a full package of this information, as well as the other Commissioners. Commissioner Foley asked Mr. Gillen whether he thought the Planning, Engineering and Construction (PEC) Committee would be the appropriate Committee to review this matter. Mr. Gillen replied, yes. Commissioner Foley asked Mr. Spencer is the engineering committee, as it is current constituted, an acceptable committee to comply with the requirements of this process? Mr. Spencer indicated his understanding was an ad hoc committee or this committee should be acceptable according to the Circular. Mr. Gillen added, the FAA circular calls it a “selection board”, and the circular does not say it has to be the same board that reviewed the initial RFQ. Another step the FAA wants at this time during the fee negotiations is an independent cost analysis of the fees. Mr. Gillen recommended, due to the expertise and time required, and the Engineering Department’s current workload,

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 10 that this independent cost analysis not be done in house, and further advised several alternatives could be considered: 1) having the State’s Aviation Department draw up engineering fees for comparisons; 2) hiring an engineer currently on retainer who has not made the short list or has not submitted an RFQ; or 3) selecting one of the consultants that did not make the short list. Acting President McCrossen asked Mr. Gillen whether any action was needed from the Committee today? Mr. Gillen replied, no action is needed today, and the short list would be brought to the PEC Committee at its February meeting, and preparations made to make an award at the February Board meeting. Mr. Hearn will select in-house staff to review the RFQ’s responses coming in on Thursday. G. Boathouse N-34, Orleans Marina

Mr. Albert Pappalardo, OLD Real Estate Consultant, reported that Mr. Eric Burns requested approval to transfer the lease for Boathouse N-34 to Mr. Mark Marzoni. Mr. Marzoni has negotiated a price with Mr. Burns, complied with all of OLD requirements, and has obligated himself to repair the boathouse and present a damage repair assessment to the District. Mr. Pappalardo found the transfer to be in order. Mr. Marzoni informed the Committee he is requesting the transfer of the lease for Boathouse N-34 from Mr. Burns to himself. Acting President McCrossen stated he appreciated Mr. Marzoni’s show of faith in contributing to the re-building of New Orleans. Mr. Pappalardo explained, Mr. Burns had amended his lease for three additional five year options. Mr. Marzoni will assume the remaining year on the lease, and then have three additional five year options. There is a transfer fee of $100.00. A motion was offered by Commissioner Foley to approve the transfer of the lease for Boathouse N-34, which was seconded by Commissioner Borne, and unanimously adopted. Commissioner Foley requested that Item IV on the Legal Committee Agenda, “Engagement of Legal Counsel to Perform Services Related to Post Hurricane Katrina Financial and Related Matters and Certain Relatives Oil and Gas Matters”, be discussed next. There was no objection to Commissioner Foley’s request. Commissioner Foley then offered a motion to defer this item for 30 days, which was seconded by Commissioner Voelker. Commissioner Foley pointed out all pending litigation against the District is being studied, and the Board was awaiting Ms. Ullmann’s analysis and recommendations on what future legal services would be needed, along with recommendations from Mr. Hearn’s office relative to budget reductions for next fiscal year. Acting President McCrossen felt this was appropriate and asked for further questions or comments. Mr. Jim Bollinger, OLD Asst. Comptroller, asked whether or not this motion had any affect on an action that the Committee may wish to take on an upcoming Finance Committee agenda item relative to the Community Disaster

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 11 Loan and Related Revenue Anticipation Notes. He felt this may be necessary given the wide range of the District’s cash demands. If this action is postponed for 30 days, it would prevent the engagement of the Board’s bond counsel to see the District through borrowing in the form of a Community Development Loan. Commissioner Foley commented he offered his motion so that the Board is not employing anyone as General Counsel for $325 per hour. Also, it was not designed for the purpose of impairing any on going relationship that the Board has entered into with lawyers who are providing services on other matters. Specifically, he did not want to retain a counsel now to handle the Bohemia Spillway case and a general counsel. For these two purposes, the motion was offered for a 30 day delay until further advice is obtained from the attorney who the Board has engaged as a temporary substitute for Mr. Gary Benoit. Commissioner Borne asked would a 30 day delay in applying for the FEMA loan be detrimental to OLD? Mr. Jarrell Godfrey explained, without yet being engaged, he had been carrying on these activities to the extent that he had prepared the resolution and tried to assist the staff in obtaining the necessary documents, assuming that he would be engaged to obtain this loan. He has not technically been engaged, with respect to bond matters and borrowing, and historically it has been a transaction by transaction engagement. Therefore, he did not think he is engaged. Commissioner Foley stated his understanding was Mr. Godfrey had rendered legal services as bond counsel for the Board in the past on an ongoing basis. Mr. Godfrey responded, he has done so in the past, as recent as September 2005, but the engagement failed because of Hurricane Katrina and was basically terminated. Commissioner Foley stated, according to his understanding, and to the extent the Board needs Mr. Godfrey’s services as bond counsel, the President has the authority, according to the Bylaws, to engaged Mr. Godfrey as bond counsel on an as need basis. Acting President McCrossen advised, since a legal committee has been formed, everything has been worked through the committee, then forwarded to the Board for approval. Mr. Godfrey explained the FEMA loan was basically approved through the State and the first round of loans has been totally allotted. As he appreciates, this entity has been left out because this loan process has not been completed, nor approved by the Bond Commission. At the last Bond Commission meeting he took it upon himself to get the entity approval done before the next round of funding or else the Orleans Levee District would be left out. Acting President McCrossen asked Mr. Godfrey was it necessary for a bond attorney to interface with FEMA for the community development loan? Mr. Godfrey replied, yes; at some point it would be necessary for a bond attorney to interface with FEMA for the loan. Acting President McCrossen asked was it necessary to complete the application today, and Mr. Godfrey replied it was necessary to get the matter before the Bond Commission at its next meeting on January 19.

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Commissioner Foley reiterated it was his understanding that the President could issue an engagement letter for those services, and the item that was being deferred was to retain Mr. Godfrey by Board resolution as our general counsel and authorize him to handle the Bohemia Spillway case. Acting President McCrossen clarified that was not the intent. Mr. Godfrey further explained he had no intention of handling the Bohemia Spillway case. He had intended to review all of the financial options to keep the organization float during the recovery period from Hurricane Katrina. In doing that, there are some oil and gas financial matters relating to identifying financial resources and using that as collateral, and this was the only input he intended to have with respect to the District’s oil and gas matters. Acting President McCrossen indicated the proposed Resolution under Item IV should be to go forward and complete the FEMA Community Disaster Loan Program application and get before the Bond Commission by January 19. Commissioner Borne explained that the Legal Committee is trying to implement new procedures, utilizing “retainer agreements” in lieu of “letters of engagement”. He had requested the District’s Senior Counsel Gary Benoit at a Legal Committee meeting to draft a retainer agreement to be used for all attorneys, making the procedures that were discussed a part of the retainer agreement. He stated he would like to use that procedure in this case also, and requested Ms. Ullman to draft a retainer agreement specifically for the FEMA loan, and not for any other engagement. When an oil and gas attorney is hired, the Board will engage him on a retainer agreement. Also, as discussed with Mr. Godfrey, in order to get hold of the District’s legal expenses, fee caps must be placed on legal contracts. Once the cap is maxed out, then the attorney must appear before the Legal Committee, explaining what has been done, where the District is going and the probability of success, and allow the Committee to decide whether services should continue. Sometimes in the past the problem has been once a matter starts, it never ends, without suitable oversight. He wanted the proposed procedures in place and retainer agreements utilized. Acting President McCrossen further explained this is all an outgrowth of the Legal Committee, which was established in April, 2005. The Committee set forth setting up new guidelines, which are being improved in 2006, to better select professionals to assist the Board in its mission. Commissioner Voelker asked Mr. Godfrey who could assist him with oil and gas revenue stream information, and Mr. Godfrey replied, Mr. Joe Quilio, the Board’s Petroleum Consultant, who has been retained for years. Commissioner Voelker asked whether a Tax Anticipated Note or Revenue Anticipation Note, which was tabled at the last Board meeting, was being discussed. Mr. Godfrey responded, it could be either, depending on the sources of collateral. The District had revenues from non-tax and tax receipts, and, technically, it makes no difference. The FEMA loan would probably have to be secured by a bottom subordination pledge. A FEMA loan is designed to be the last resort for a troubled entity. It may be a subordinated lien against all existing and future prior liens against tax receipts and other revenues.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 13 Commissioner Voelker felt tax anticipation notes best at this time, and commented that sixty days from now things could change for the District. The strategy the Board uses with its oil and gas properties and litigation could change, and should levee districts merge other changes would occur. Therefore, any money that the Board spends unnecessarily or any debt it incurs unnecessarily at this time is a bad idea. The Orleans Levee District is currently borderline debt-wise unattractive in any kind of merger, and anything the Board does to enhance its debt will make it even more unattractive. Relative to Commissioner Borne’s question as to whether or not 30 days would make a difference with the FEMA loan, Mr. Bollinger stated it would not bankrupt the District, but since the District was late in starting this process, it wanted to get it going. Commissioner Foley reiterated in the past, if an attorney was required, the President had authorization to retain one. His motion to table Item IV on the Legal Committee agenda was to table all matters arising out of that Resolution, but did not prevent Acting President McCrossen from continuing the legal relationship with Mr. Godfrey to complete the FEMA loan application. Mr. Bollinger explained, with respect to revenue anticipation, the Finance Department agreed with Commissioner Voelker, and did not want to burden the Agency. With the unprecedented losses, the District put out money in advance with FEMA reimbursement, and will be impacted more and more dramatically as time goes on as it tries to rebuild. The District not only suffered a tremendous loss in revenues and uncertainties, but in thinking of revenue anticipation, he is limiting it to what FEMA may have approved, and the District may have to wait six months to see what insurance carriers have approved. Mr. Bollinger stated the FEMA loan should be approximately $7 or $8 million, and recommended the Levee District not apply for the loan if it is for a 10 year period because the five year amortization would be $1.6 million and he did not want to put that type of burden on the District. Mr. Godfrey added, the FEMA program is designed to help primarily with operating expenses and can be used and drawn when needed. If the District borrows from FEMA under this program, there will be a subordination pledge against the tax receipt. Under the Code of Federal regulations, the FEMA loan is for the lesser amount of 25 percent of the budget for the year of the disaster or actual losses. It is designed to be a five year bullet amortization, and when money is borrowed interest is at a pre-determined Federal rate announced by the Treasury the day the money is borrowed. The loan is paid back in five years, and FEMA does not have the right to extend it for another five years. Congress passed a law in October 2005 that these loans would not be forgiven, and he did not want the Committee to anticipate this loan will be turned into a grant. Acting President McCrossen thanked Mr. Godfrey for his opinion and comments. He stated a motion was offered earlier by Commissioner Foley, and seconded by Commissioner Borne, to postpone Item IV, on the Legal Committee’s agenda. The motion was adopted. Commissioner Voelker departed the meeting at 3:05 p.m. H. Report on Status of District’s Real Estate Leases

Mr. Pappalardo presented a written report to the Commissioners which outlined the revenue producing properties of the Orleans Levee District (OLD). Six of the tenants have paid 4th quarter rent. The District has received requests

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 14 for rent relief from some tenants, and has not received any communication from others. Each month the OLD Finance Department invoices these tenants. If the Board agrees that Legal Counsel thus far has been correct in that the land leases offer no relief, then the Board should instruct that rent be collected. Acting President McCrossen asked Mr. Metzger for his recommendation in terms of legal options, and whether the forgiveness of rent would be an illegal act or a prohibited donation. Mr. Metzger responded that the issue of abatement was raised by Mr. Gary Benoit, former OLD Senior Counsel. Mr. Metzger explained he was not authorized to research this issue, so he could not give a definitive opinion on the matter. Under the leases (ground leases), the impact of the storm on the tenants’ improvements has no impact on their rental obligation. If the Board wanted to entertain a deferment of rent, that would not impose a constitutional problem; however, if the Board was considering rent abatement, he suggested Ms. Ullmann look into the matter and render an opinion to the Board. Commissioner Borne asked what did the leases call for in way of enforcement? Mr. Metzger responded, in most of these cases, the tenants just are not paying their rent. The leases provide a default provision and a grace period, and most of the tenants have leases with an acceleration clause. Acting President McCrossen pointed out that the Landry’s Seafood New Orleans lease situation was different because there was a disagreement with the tenant prior to the storm. Mr. Metzger explained prior to the storm, there was a problem with Landry’s on payment of the adjusted rental. Landry’s paid its quarterly rent postKatrina, but did not pay the full amount of the rent based on the adjustment. Landry’s had made their third quarter rental payment, and when the rent was adjusted after the commencement of the third quarter, Landry’s issued a check to pay the full amount due, and then issued a stop payment order on the check. Landry’s had notified Mr. Hearn, and Mr. Hearn discussed this matter with the Real Estate Consultant, Mr. Benoit and himself to pursue the matter. The hurricane intervened, and after the hurricane Mr. Metzger sent Landry’s a default notice, activated the grace period, and a lawsuit is now being filed. When asked if litigation against Landry’s was to terminate the lease, Mr. Metzger replied, no; it is to accelerate the lease for its remaining term. At the last Legal Committee meeting, he was asked to find out why Landry’s issued the stop payment on its check before the Legal Committee would make a recommendation to the Board, and as of yet, he has not received a response. Commissioner Foley asked had J & J Partners/Six by the Sea has paid its rent, and Mr. Pappalardo responded, that is one of the tenants who has not paid the fourth quarter rent and is included in the report. Commissioner Foley asked, relative to lease acceleration; for example, if a tenant has a 10 year lease, could the Board ask that tenant to pay ten years of rent now Mr. Metzger replied, yes, adding some of the issues needed to be discussed in an executive session.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 15 Commissioner Foley asked whether each case would be looked at individually to determine whether it would be better for the Board to sue for accelerated payment or to evict. Mr. Metzger replied, yes; it would have to be a decision by the Committee. When he met with the Legal Committee on December 6th, he was asked to get a response from Landry’s, which has not yet been received. Options are available, and in this case a suit was filed to accelerate the rent. Commissioner Foley felt, in respect to a land lease, Mr. Metzger is saying, “an act of God” is at the risk of the Lessee, and not the Lessor. Mr. Metzger responded, there is nothing in the lease that states the Lessee receives an abatement if his improvements are destroyed. The Board did not lease the improvements to the tenants; it is a ground lease, and the same as a homeowner still being responsible for the mortgage if his home is destroyed. Acting President McCrossen pointed out the discussion needed to be classified because some of the leases have different provisions. Relative to the “New Basin Canal” (NBC) leases, he asked Mr. Pappalardo what he wanted the Committee to consider in terms of those 17 leases. Mr. Pappalardo responded, at the very least, an attorney, whether staff or outside counsel, should be instructed to send “demand” letters. The Committee has heard the circumstances and it was determined that there is no rent abatement and the District is demanding rent as of this time. This is preparatory before any legal action will take place. Mr. Pappalardo continued with his presentation, the next property being the Lake Vista Community Center (LVCC), which has 12 tenants on the ground floor. Some tenants have paid the September rent and others have not, and no tenant is completely paid up to date in the building. The lease has a provision that if there is damage to the improvements, rent can be abated at the prerogative of the landlord; however, there was minor damage to this building. Acting President McCrossen asked would lack of electricity be considered damage to the building? Mr. Pappalardo explained he surveyed the private and public sector, and if there is lack of electricity in a building, his understanding was that most landlords have abated rent. He estimated electrical service was restored to the LVCC about late October. Also, he was contacted by Mr. Larry Talamo, a LVCC tenant, advising his telephone service had just been restored and he would be sending a check for January’s rent. Mr. Talamo, a State Farm Agent, had written a letter to the Board stating that without access to telephone and internet service, he could not conduct business. Mr. Pappalardo felt there was no question regarding rent abatement for September and October, however, the LVCC had electrical service in November and December, and the question is what should be done about those two months. He added, the French Market Corporation at its board meeting voted to waive base rent for its French Market tenants from September through November and to charge one-half of the minimal rent during the period December through March 2006. Mr. Pappalardo noted the District is currently due $72,000 from LVCC tenants. The District needs to take a position on whether to abate all or part of the rent, and move forward either by notifying the tenants of an abatement, deferral or issue demand letters. Since the District owns the building and there

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 16 was no electricity, he felt it owed the tenants an abatement. Also, since the issue of telephone service is not covered by law, he asked several attorneys for an opinion as to whether telephone service is equal to electrical service. Also, the District would deal with lease cancellations on an individual basis with tenants who are not returning. There has been some discussion that the District is in need of office space and could possibly move in when space becomes available. Acting President McCrossen clarified the Committee was dealing with two issues; first, 17 leases on New Basin Canal, six of which had paid rent through the third quarter, and, second, 12 LVCC tenants leasing office space. Mr. Pappalardo added, the Belle of Orleans is in arrears in the amount of $418,000, which includes land leases on a portion of the Airport and South Shore Harbor. He indicated this issue should be discussed in the Legal Committee meeting in order to timely exercise the District’s rights. Commissioner Foley asked Mr. Pappalardo how would he view the situation under two scenarios; first, if electrical service was interrupted due to damage to the building itself, and, second, if electrical service was interrupted due to damage to Entergy’s lines. Mr. Pappalardo responded he has been told that electricity is a necessary service; if you don’t have electricity, effectively, you can’t occupy a building. It doesn’t matter if lighting struck a pole on the building or lighting struck a pole 10 miles away. This analogy can also be used for telephone service. The question becomes whether or not an abatement of rent is allowable for loss of telephone service. Most landlords in this area suffered extreme damage to their buildings, such as, the “Lupo Building” and the “Signa Rally Building”. He added, it was just the northern portion of the city that the main telephone switch failed, and this is a situation that is unique to the lakefront area. Commissioner Borne asked Mr. Talamo did he have business interruption insurance? Mr. Talamo replied, yes; the insurance company paid him three weeks of loss earnings, and that it was based upon the amount of damage to the building, which was not substantial. Commissioner Borne asked what is State Farm’s policy in regards to rent? Mr. Talamo replied, State Farm does nothing about that. Mr. Talamo stated he is an independent agent. Commissioner Foley pointed out, in order to cover loss of income, the standard formula on a business interruption policy covers loss of net income and overhead, which would include rent. He asked Mr. Talamo was he reimbursed for rent? Mr. Talamo replied, no; State Farm only allowed him three weeks’ earnings because he had not been able to use the building. He added, since he did not have use of the building, his staff had been relocated to four different areas incurring expenses. Acting President McCrossen thanked Mr. Talamo for his comments, and asked Mr. Pappalardo for his recommendations concerning the LVCC, Belle of Orleans and New Basin Canal leases.

Minutes of Joint Finance Committee & Planning, Engineering and Construction Committee Meeting Held on January 3, 2006 Page 17 Mr. Pappalardo recommended, relative to the New Basin Canal leases that Legal Counsel immediately send demand letters, pointing out the lease provision anticipating that the property along the New Basin Canal communicates with Lake Pontchartrain and is subject to high wind, water and dangerous storms. He added, tenants are probably waiting for insurance money, however, the District should proceed legally, and if a response is not received, move to the next level to protect the District’s property interest. With respect to the LVCC, an abatement of rent for September and October rent is appropriate. The problem of not having telephone service creates a dilemma. The District could allow November and December rent to be deferred. Should there be tenants that do not come back, the donation statute would come into effect, and the District could not simply forgive rent and allow tenants to walk away. He felt Mr. Maureau would be in a better position to discuss the Belle of Orleans since that is a substantial rent. Commissioner Foley offered a motion to instruct Ms. Ullmann to draft a “polite” demand letter to the NBC tenants who are in default, reminding them of their obligation to pay rent and outlining their liability should rent not be paid, which was seconded by Commissioner Borne, and unanimously approved. Commissioner Foley stated his concern with the question of rent abatement is two fold; first, he wanted to assure the District is authorized by Louisiana law to abate rent, and, second, he did not want to abate rent for a tenant who has collected that rent from his insurance company. He suggested a resolution be drafted that would authorize deferment of rent for September and October, and that a decision be obtained from the Attorney General (AG) on whether or not the rent could be abated. The deferment would last for several months in order to give the AG enough time to provide a formal opinion, and if he indicates the rent can be abated, then the District would abate rent for the time that there was no electrical service in the LVCC. Commissioner Foley then offered a motion; first, to recommend a deferment of rent for LVCC tenants for the months of September and October until April 30, 2006; and, second, to abate that rent if the Attorney General of Louisiana writes a formal written opinion indicating that the District is authorized by law to abate that rent. If the AG does not approve the abatement, then the tenants would only get the deferral and not the abatement. The tenant would get the deferral immediately, and the abatement if the District can legally do so. Mr. Pappalardo asked would there be a demand for the November and December rents. Commissioner Foley replied, yes. Mr. Pappalardo felt this was a good solution and offered relief to tenants. Commissioner Foley strongly expressed that he did not want any tenant’s rent to be abated if they had collected this rent from their insurance company. The resolution should read that any tenant who has received business interruption insurance benefits based in part upon alleged rental payments would not receive the rent abatement. Tenants would be required to sign an affidavit stating they have not collected any business interruption benefit based upon a presentation of their expenses which included rent. If a tenant collects such benefits from his insurance and had signed the affidavit indicating that he had not, then he would have committed fraud by signing a fraudulent affidavit, and the District would have at least ten years to retrieve the abatement from the tenant.

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The motion offered by Commissioner Foley, seconded by Commissioner Borne, was unanimously adopted. I. Liability Insurance Coverage

Mrs. Carol Kiefer, Director of Auxiliary Services, reported that Mr. Randy Maddox had contacted her earlier stating that St. Paul has agreed to renew the General Liability policy. She distributed and explained a handout concerning the coverage. The schedule of premiums will not be available until next week, and once received, each Commissioner would be provided a copy. She explained, premiums probably would not change too much, but the terms would be different. There will be a $250,000 (per occurrence) self-insured retention; before it was a $50,000 retention, with a $400,000 aggregate. This does not cover E & O. Mrs. Kiefer stated, as far as Excess General Liability, the insurance company had denied coverage. They offered to renew the Police Liability insurance coverage basically under the same terms. Commissioner Borne asked Mrs. Kiefer is the District currently covered? Mrs. Kiefer replied, yes; the District is covered under the old terms with St. Paul through February 7. Acting President McCrossen asked for comments or questions, and there were none. J. Application For Community Disaster Loan and Related Revenue Anticipation Notes

Mr. Jim Bollinger, OLD Asst. Comptroller, explained, if the District is interested in applying for the loan, Bond Commission approval is required, and before this can be done, approval from the Board is needed. A resolution would be required at the January Board Meeting to bring the revenue anticipation proposal before the Bond Commission. Also, the District’s Legal Counsel should prepare a retainer agreement for Mr. Godfrey for this engagement. Commissioner Foley stated his understanding was the President could engage counsel; and should the Board implement a change in the way counsel is employed, then it would be effective upon implementation. Commissioner Borne advised the Legal Committee would be discussing some possible problems with procedures used in the past for retaining counsel, and that a Board resolution may be required. Mr. Godfrey interjected, the Bond Commission has agenda deadlines that are drawing near, and it would be helpful to ask the Bond Commission to allow the District leniency in placing its proposal on its January meeting agenda, if this Committee votes to recommend approval to the Board. Acting President McCrossen pointed out the District could reject the loan after it is approved; what it is saying today is that it is going forward with the application. Commissioner Borne offered a motion that the Board goes forward with the application for the Disaster Loan, which was seconded by Commissioner Foley, and unanimously approved.

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K. • •

Ad Hoc Committee Reports Insurance – Previously discussed. Marina – Mr. Bob Maureau, Senior Marina Manager, reported he is still seeking funds for the removal of underwater debris cleanup, and tenants are not being accepted at South Shore Harbor. Mr. Spencer stated he had a request from Dr. Rubin, a boathouse tenant, to place a FEMA trailer on his lot temporarily. Mr. Maureau pointed out the trailer must be placed within the confines of the tenant’s leasehold. Dr. Rubin’s agreement to this requirement would be required.

• •

Personnel Issues – No report. Relocation Plan for Staff to Return to New Orleans - Mr. Hearn reported that the return of staff depends upon communications at the Franklin facility. Fiber optic lines are located outside of the facility, but not inside the facility. Staff relocation would probably take place at the end of January or mid February. There are nine trailers, which are awaiting communications. Currently, Police Administration, South Shore Harbor and Orleans Marina staff are occupying trailers. Public Comments Acting President McCrossen asked for public comments, and there were

L.

none. There being no further comments or other matters brought before the Committee, the meeting was adjourned at 4:05 p.m.