The 47-year old had been at Shelbourne last season, splitting his time between there and the FAI where his Development role included assisting the Ireland under-21 side.
Reynolds can't wait to get going and is excited about the forthcoming campaign, which he feels everyone needs to embrace.
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“I really enjoyed my spell here in 2008 and 2009. At times I felt like it was unfinished business that I would end up here at some stage because of the relationship I had with some of the people up here," he explained.
"I’m delighted to be here, it’s a new challenge and there’s a lot expected from us, but we’ll embrace that and enjoy it.”
For Higgins he's delighted to have got his man and believes the ex-Waterford boss will enhance his back-room.
“Alan is a fantastic coach and it is important for me to have someone of his quality and experience here," stated the Derry boss.
“He knows the league inside out and will have the trust of the players, which is key. He’s been here before which always helps as well, and he will bring plenty of ideas and energy to the club.
“We are comfortable with where we are in our preparations for the new season and are looking forward to getting going again in the coming weeks.”