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2004 09 15 BAWA Minutes• • MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN AREA WATER AUTHORITY September 15, 2004 The Board of Directors of the Baytown Area Water Authority, Harris County, Texas, met in regular session on Wednesday, September 15, 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 August 18, 2004. Board Member Buenz moved approval of the minutes of the meeting held on August 18, 2004. Board Member Beavers seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Conejo and Mundinger President Gillette. Nays: None. The motion carried. Election of Officers. Board Member Beavers nominated Robert L. Gillette as President. Board Member Conejo seconded the motion. The vote follows: Ayes: Board Members Buenz, Beavers, Conejo and Mundinger President Gillette Nays: None The motion carried. President Gillette nominated Dan M. Mundinger as Vice -President, and Peter Buenz as Secretary. Board Member Buenz seconded the motion. The vote follows: Page 2 of 3 Minutes of the Regular Meeting —September 15, 2004 Ayes: Board Members Buenz, Beavers, Conejo and Mundinger President Gillette Nays: None The motion carried. Consider Proposed Resolution No. 040915-1, approving the BA WA Investment Policy. Proposed Resolution No. 040915-1 submits for annual review and approval, BAWA's Investment Policy and Strategy, in compliance with the Public Funds Investment Act. The City's Finance Committee reviewed the policy at its meeting on August 31, 2004 and recommends approval. The policy was last reviewed and approved by the Board at the regular meeting held on September 17, 2003. No changes have been made to the current policy. Donna Sams, Finance Director, informed the Board that the Legal Department had not yet completed negotiations for the contract with Bank One as the Authority's primary banking depository, as shown in Exhibit "C" to the proposed resolution. Board Member Buenz moved approval of the proposed resolution, subject to finalization of the banking depository contract with Bank One. Board Member Mundinger 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. 040915-2, approving an Interlocal Agreement with the City of Baytown to provide for auditing services for the Baytown Area Water Authority for the fiscal years ending September 30, 2004, 2005, and 2006. The City of Baytown will enter into a professional services agreement for the initial three-year period, with Sandersen, Knox & Belt, L.L.P., to conduct the required audit of BAWA's finances for the fiscal years ending September 30, 2004, 2005, and 2006. Five proposals were received and were narrowed down to include firms with municipal auditing experience. The Finance Committee interviewed three firms and recommends Sandersen, Knox & Belt, L.L.P. The agreement contains the option to renew for an additional three-year period. A total of $12,500 was included in the 2005 budget for the first year. The fees for providing the auditing services are $4,478 for 2004, $4,657 for 2005 and $4,843 for 2006. The proposed Interlocal Agreement provides for reimbursement of the City for the expenses of the audits. • Board Member Beavers moved approval of the proposed resolution. Board Member Conejo seconded the motion. The vote follows: Page 3 of 3 • • Minutes of the Regular Meeting —September 15, 2004 Ayes: Board Members Beavers, Buenz, Conejo and Mundinger President Gillette. Nays: None. The motion carried. Consider Proposed Resolution No. 040915-3, awarding a contract for banking depository services. This item was not ready for consideration. Manager's Report. Tony Brown, Plant Supervisor, reviewed the current water sales. The August average was 13.1 million gallons per day. The year to date average is 11.7 million gallons per day. The budgeted average is 12.2 million gallons per day. The September average is projected to be 13.8 million gallons per day. It is unlikely that the budgeted average will be met. Fred Pack, Plant Manager, informed the Board that negotiations continue with the City of Houston regarding the quantity of water the Authority can buy without penalty and the length of the contract. Because the Authority has applied to the Texas Water Development Board (TWDB) for a loan, the TWDB has requested that the quantity of water and the length of the contract coincide with the 20-year payout of the loan. That is the purpose of staff's renegotiation of the contract with the City of Houston. Staff does not expect an increase in the cost of the water. Gary Jackson, General Manager, reported that City Council adopted the 2004-2005 Fiscal Year Budget, including the budget for BAWA, at the September 9, 2004 meeting. This budget contains a 4% across-the-board increase for all City employees, effective January 1, 2005, including BAWA employees and members of the Police Department. It does not include Fire Department employees due to collective bargaining. Mr. Jackson said that there are sufficient funds in contingency to cover this increase. Adjourn As there was no further business to be transacted, the meeting adjourned at 8:07 a.m. Patti Merrell, Assistant to the Assistant Secretary