Below is a portion of the testimony from Kenneth Davis, Vice
President of Pate Engineers, Inc. ("Pate") on behalf of The Herman
Group of Companies (THGC, the potential buyer of the Country Club).
It was recently submitted as part of SHECO's PUC approval process for
the proposed transmission lines.


WHAT IS THE HERMAN GROUP OF COMPANIES' INTEREST IN THIS PROCEEDING?
THGC is in the process of acquiring approximately 10,000 acres for
its Summer Land development near Lake Livingston. The Herman Group's
planned development of Summer Land would be adversely affected by one
or more of the alternative transmission line routes identified in
this docket by Sam Houston Electric Cooperative ("SHECO' or "the
Cooperative").

CAN YOU DESCRIBE THE HERMAN GROUP'S DEVELOPMENT PLANS AT
LAKE LIVINGSTON IN MORE DETAIL?
Yes. The Summer Land development is planned to include a number of
hotels totaling as many as 1,1 00 rooms, two golf courses,
approximately 6,000 residential lots, as much as 210,000 square feet
of retail space, up to 1,200 boat slips in several marinas, a water
park, an equestrian center, and multiple restaurants, all within the
10,000 acre site. The Herman Group's development plans also include
the introduction of extensive water features, including a central
chain of lakes that will be designed to introduce waterfront
living and water sports recreational opportunities to the majority of
the development area.

WHAT IS THE PROJECTED ASSESSED VALUE OF THE DEVELOPMENT AT
LAKE LIVINGSTON?
Based on the preliminary development projections outlined above, the
Summer Land development should ultimately result in the construction
of improvements approaching $1.6 billion dollars in taxable assessed
value.

END