1998 02 18 BAWA MinutesMINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS OF THE BAYTOWN AREA WATER AUTHORITY February 18, 1998 The Board of Directors of the Baytown Area Water Authority, Harris County, Texas, met in regular session on Wednesday, February 18, 1998, 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 Roy L. Fuller, Board Member Absent: Peter R. Buenz, Secretary The meeting opened with a quorum present, and the following business was conducted. Consider Approval of Minutes for the Regular Meeting on January 21, 1987 Board Member Mundinger moved for approval of the minutes for the regular meeting held on January 21. Board Member Fuller seconded the motion. The vote follows: Ayes: Nays: Board Members Beavers, Fuller, Gillette and Mundinger None Discuss Overview of Chapter 171 of the Texas Local Government Code — Conflicts of Interests City Attorney Ramirez reviewed Chapter 171 of the Texas Local Government Code governing conflicts of interest as set forth in Attachment "A." • 980218-2 • • Minutes of the BAWA Meeting — February 18, 1998 He also reminded the board that care should be given during social functions where a quorum of the board is present to refrain from discussing Baytown Area Water Authority business. This could result in a violation of the Open Meetings statutes which require posting notice of all meetings of the board. There is also a nepotism statute which would preclude a relative of a board member within a certain degree of affinity or consanguinity from being employed with Baytown Area Water Authority. Manager's Report Presently, both the EPA and TNRCC require that BAWA be at 0.5 NTU which is the unit of measurement for turbidity. Turbidity is the measurement of suspended solids in water (how clear it is). When the new standards become effective, EPA will require 0.3 NTU, while TNRCC will require 0.1 NTU. Presently, BAWA is producing water with 0.05 — 0.07 NTU utilizing existing filters with a composite reading. By replacing the filters, BAWA will make even better water. The lower the rating the less likelihood of disease. Once the water is introduced into the distribution system, the water clarity is effected by corrosiveness of the distribution system. In the 1991 Bond Program $6,000,000 was included for water rehabilitation. A water rehabilitation crew has been systematically moving through the city replacing existing pipes with PVC pipe. Consider Award of Annual Instrument Calibration Contract No action was necessary on this item. Adjourn There being no further business to be transacted, the meeting was adjourned. Robert L. Gillette President Attachment "A" City of Baytown MEMORANDUM TO: Mayor, City Council and all Boards and C missions of the City of Baytown FROM: Ignacio Ramirez, Sr., City Attorney DATE: January 22, 1998 SUBJECT: Overview of Chapter 171 of the Texas Local Government Code governing conflicts of interest Chapter 171 of the Local Government Code provides the statutory authority which regulates conflicts of interests of local public officials who exercise responsibilities beyond those that are merely advisory in nature. Tex. Loc. Gov't Code Ann. §171.001(1) (Vernon 1987). Such authority is applicable to the city council as well as most all of the boards and commissions of the City of Baytown and governs the extent members of such councils, boards and commissions may participate in decisions on matters in which a member may have a special interest. A conflict under this chapter is measured by the interest a public official or certain relatives of the public official) ("covered relatives") have in a business entity or in real property. Such an interest must be substantial. A substantial interest pertaining to a business entity exists if a public official or a covered relative of a public official: (1) owns 10 percent or more of the voting stock or shares of a business entity, (2) owns 10 percent or more of the fair market value of a business entity; (3) owns $15,000 or more of the fair market value of a business entity; or (4) receives funds from a business entity, which exceed 10 percent of the persons' gross income received in the previous year. Id. at §171.002(a). Likewise, a public official or his covered relative has a substantial interest in real property "if the interest is an equitable or legal ownership with a fair market value of $2,500 or more." Id. at § 171.002(b). If a substantial interest exists, the public official shall not only "file [with the official record keeper of the council, board or commission], before a vote or decision on any matter involving the business entity or the real property, an affidavit stating the nature and extent of the interest" but also "abstain from further participation in the matter if: (I) in the case of a substantial interest in a business entity the action on the matter will have a special economic effect on the business entity that is distinguishable from the effect on the public; or (2) in the case of a substantial interest in real property, it is reasonably foreseeable that an action on the matter will have a special economic effect on the value of the property, distinguishable from its effect on the public. Id. at §171.004(a), (b). However, if a public official files an affidavit and if a majority of the public officials of the council, board or commission likewise file affidavits of similar interests on the same matter, none of the public officials are required to abstain from further participation. Id. at 171.004(c). In summary, once a public official becomes aware that he or she has a conflict of interest, the official should immediately2 file an affidavit and abstain from any discussion, deliberation, decision and vote on the matter since there are criminal penalties associated with knowingly violating the provisions of Chapter 171. Id. at § 171.003(b). I have attached an affidavit which should be used if a conflict arises. Please note this memorandum serves to provide you with a broad overview of the state law regarding conflicts of interests; and, as such, should you have questions or are unsure whether a conflict in any given matter exists, please do not hesitate to contact me. Attachment c:klh:k1h73\ Legal \Memo\Confl ictonntcrcstMcmo2All11oards&Comm isison t Only those relatives who are related within the first degree of consanguinity or affinity can cause a public official to have a conflict of interest under Chapter 171 of the Texas Local Government Code. Such persons include, in general, a spouse, parent, child, parent -in-law, daughter-in-law, and son-in- law. 2 While no statutory or case law exists regarding the timing of the filing of an affidavit, it is the position of both the Texas Municipal League and the "Texas Attorney General's Office that an affidavit should be filed immediately once the public official becomes aware of a conflict, else risk criminal prosecution.