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1999 12 15 BAWA Minutes• MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN AREA WATER AUTHORITY December 15, 1999 The Board of Directors of the Baytown Area Water Authority, Harris County, Texas, met in regular session on Wednesday, December 15, 1999, at 7425 Thompson Road, in the BAWA Conference Room with the following in attendance: Robert L. Gillette, President Dan Mundinger, Vice President Knox Beavers, Board Member Absent: Peter R. Buenz, Secretary Roy L. Fuller, Board Member The meeting opened with a quorum present, and the following business was conducted. Consider Approval of the Minutes for the Special Meeting Held on November 10, 1999 Board Member Mundinger moved to approve the minutes for the special meeting held on November 10, 1999; Board Member Beavers seconded the motion. The vote follows: Ayes: Nays: Board Members Beavers, Gillette and Mundinger None Consider Approval of the Minutes for the Regular Meeting Held on November 17, 1999 Board Member Mundinger moved for approval of the minutes for the regular meeting held on November 17 1999; Board Member Beavers seconded the motion. The vote follows: Ayes: Nays: Board Members Beavers, Gillette and Mundinger None 991215-2 • Minutes of the BAWA Meeting — December 15, 1999 Consider Acceptance of Financial Statements for Fiscal Year Ending September 30, 1999 and 1998. Mike Daws, Finance Director for the City of Baytown, noted that as a result of operations, BAWA's revenues exceeded expenditures by $754,000 which is twenty-five percent (25%) less than last year due to water sales being down by six percent (6%). Water sales were down due to an unusually wet year. The raw water purchases were also down six percent (6%) which corresponds with sales. Expenses were up slightly, approximately four and one-half percent (4-1/2%) due to extra efforts to obtain the Texas Optimization Award. The Balance Sheet reflects a decrease in cash. A number of month's back, BAWA decided to use operational money to fund engineering costs for the new plant expansion. The bonds were sold yesterday and the operating account will be reimbursed $413,000 from that bond sale. This report is much thicker than prior years because TNRCC is requiring several schedules such as budget to actual comparison and a schedule reflecting five years of operations. In the five year comparison, revenues in 1995 were 4.6 million dollars; 1998, 5.2 million dollars; and 1999, 4.8 million dollars. This reflects that 1998 was an unusual year and in 1999 there were some dry conditions but not excessive. Mr. Daws acknowledged Donna Sams, Controller, and her staff, and Fred Pack, Tony Brown, and their staff for the work that went into development of the Financial Statements. Mark Tiller, with Tiller and Company, stated that his firm had issued a clean opinion letter which means that the financial statements prepared by city staff members present fairly, in all material respects the financial position of the Baytown Area Water Authority as of September 30, 1999 and 1998, and the results of its operations and its cash flow for the years then ended in conformity with generally accepted accounting principles. He noted that expenses were held in line with relation to the revenues. He directed the Board to Page 10, where under Subsequent Events, the issuance of revenue bonds in November 1999 is noted as previously mentioned by Mr. Daws. Mr. Tiller also mentioned that on Page 13, was shown a ten-year history of revenue, expenses, and funds available for debt service. He reiterated operational staff had done an excellent job and mentioned that the financial staff had done equally well in putting the financial statements together. Board Member Beavers moved to accept the financial statements for fiscal year ending September 30, 1999 and 1998. Board Member Mundinger seconded the motion. The vote follows: 991215-3 Ayes: Nays: Minutes of the BAWA Meeting — December 15, 1999 Board Members Beavers, Gillette, and Mundinger None Consider Approval of a Division Order Pursuant to the Oil, Gas and Mineral Lease with Sanchez Oil & Gas Company Ignacio Ramirez, City Attorney, stated that the Division Order provided for payment of 0.01943312 percent interest royalty. Payments are to be made monthly by payer's check. However, payments less than $25.00 may be accrued before disbursement until the total amount equals $25.00 or more, or until December 31 of each year, whichever occurs first. Board Member Mundinger moved to approve the Division Order. Board Member Beavers seconded the motion. The vote follows: Ayes: Nays: Board Members Beavers, Gillette and Mundinger None Plant Manager's Report Fred Pack, Director of Utilities for the City of Baytown, stated that tomorrow BAWA staff would have ninety percent (90%) of the plans for the plant expansion in hand. On December 29 staff will review those plans with the consulting engineers from Camp Dresser & McKee Inc. In January, staff should be coming to the Board with plans and specifications for building renovations and removal of the old lime silos. Tony Brown, Plant Superintendent, stated that BAWA has received another six- month Optimization Award and will be receiving certificates for posting at BAWA and City Hall from TNRCC. The operators will receive a pin indicating attainment of optimization for a year. The award must be applied for every six months. • 991215-4 Minutes of the BAWA Meeting — December 15, 1999 Adjourn There being no further business to be transacted, the motion was made to adjourn. • ,?° Robert L. Gillette President