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2004 10 20 BAWA Minutes• • MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN AREA WATER AUTHORITY October 20, 2004 The Board of Directors of the Baytown Area Water Authority, Harris County, Texas, met in regular session on Wednesday, October 20, 2004, in the Conference Room, 7425 Thompson Road, Baytown, Texas, with the following in attendance: Robert L. Gillette, President Dan Mundinger, Vice President Peter Buenz, Secretary Knox Beavers, Board Member Dan Conejo, Board Member. The meeting opened at 8:00 a.m. with a quorum present, and the following business was conducted: Consider approval of the minutes for the meeting held on September 15, 2004. Board Member Mundinger moved approval of the minutes of the meeting held on September 15, 2004. Board Member Conejo seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Conejo and Mundinger President Gillette. Nays: None. The motion carried. Consider Proposed Resolution No. 041020-1, approving a contract amendment to the Water Supply Agreement between the City of Houston and the Baytown Area Water Authority to extend the term of the agreement and increase the contract quantity. BAWA has purchased raw water from the City of Houston since its inception in 1977. Currently, BAWA is requesting funding through the Texas Water Development Board (TWDB) Drinking Water State Revolving Fund (DWSRF) for two capital improvement projects. The DWSRF provides low interest loans and subsidies to public drinking water systems. In the application process, TWDB questioned BAWA's water supply availability after 2020, the year in which BAWA's current contract with the City of Houston would expire. Specifically, TWDB was concerned that if bonds were issued for twenty years for the current projects, the maturity of the bonds would extend beyond the maturity date of the existing water supply contract. To allay this concern, BAWA and the City of Houston have been working to obtain an amendment to the contract that would not only extend the agreement beyond the maturity date of the TWDB bonds but also increase the contract quantity as follows: Page 2 of 3 • • Minutes of the Regular Meeting —October 20, 2004 Current Agreement Contract Amendment Contract Quantity 11.9 million gallons per day 15.8 million gallons per day Expiration Date December 31, 2020 December 31, 2040 Pursuant to the legislation that created it, BAWA secured the approval of the City Council of the City of Baytown before entering into this contract amendment. City Council approved this contract amendment at its meeting on October 14, 2004. Board Member Buenz moved approval of the resolution. Board Member Mundinger seconded the motion. The vote follows: Ayes: Board Members Buenz, Beavers, Conejo and Mundinger President Gillette Nays: None The motion carried. Consider Proposed Resolution No. 041020-2, authorizing a contract amendment to the Water Supply Agreement with the City of Baytown to extend the term of the agreement and increase the contract quantity. This proposed amendment will not be effective until the effective date of the water supply contract between BAWA and the City of Houston. Additionally, the proposed amendment extends the term of the City of Baytown contract until December 31, 2040 and increases the contract quantity to 90% of the contract quantity that BAWA receives from the City of Houston. Specifically, the contract will be amended as follows: Current Agreement Contract Amendment Contract Quantity 10.71 million gallons per day 14.22 million gallons per day Expiration Date December 31, 2020 December 31, 2040 Board Member Buenz moved approval of the proposed resolution. Board Member Conejo seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Conejo and Mundinger President Gillette. Nays: None. The motion carried. Page 3 of 3 Minutes of the Regular Meeting —October 20, 2004 Manager's Report. Tony Brown, Plant Supervisor, reviewed the current water sales. The September average was 13.9 million gallons per day. The 2003-2004 average was 11.87 million gallons per day. The budgeted average was 12.2 million gallons per day. This produces a revenue shortfall of $149,000. A savings of $46,000 was realized due to a reduction in the purchase of raw water. Adjourn As there was no further business to be transacted, the meeting adjourned at 8:13 a.m. G .Smith Ass istant sistant Secretary