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1995 08 23 BAWA Minutes MINUTES OF THE REGULAR MEETING OF THE BOARD OF DIRECTORS • OF THE BAYTOWN AREA WATER AUTHORITY August 23, 1995 The Board of Directors of the Baytown Area Water Authority, Harris County, Texas, met in regular session on Wednesday, August 23, 1995, at 7525 Thompson Road, in the BAWA Conference Room with the following attendance: Robert L. Gillette, President Dan Mundinger, Vice-President Peter R. Buenz, Secretary Knox Beavers, Board Member Roy L. Fuller, Board Member The meeting was called to order with a quorum present, after which the following business was transacted: Consider Approval of Minutes for the Regular Meeting Held on July 19, 1995 Board Member Mundinger moved for approval of the minutes for the meeting held on July 19, 1995. Board Member Fuller seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None Plant Superintendent Introduced Fred Pack, Assistant Director of Public Works/Utilities, introduced Kirk MacLean, Plant Superintendent. Mr. MacLean comes to BAWA with a BB certification in Water and Wastewater, along with a degree from New Mexico State University in Water Utilities Operation. Mr. MacLean has a varied background in Water Production. He previously worked for League City for several years and came to BAWA from the new Southeast Purification Plant in Houston • 950823-2 Minutes of the BAWA Meeting - August 23, 1995 Consider Approval of BAWA Prevailing Wage Rate Schedule The adoption of a Prevailing Wage Rate Schedule is required by state statute. The proposed schedule developed by the General Services Commission is currently utilized throughout Harris County by various governmental entities as prevailing rate on Public Works contracts. The staff utilized a survey performed by the City of Baytown, added an additional contractor from the Highlands area, and concluded that the Prevailing Wage determinations made by the General Services Commission fairly and accurately reflect the Prevailing Wage Rates for the BAWA area. The administration recommended approval. Board Member Fuller moved for approval of the BAWA Prevailing Wage Rate Schedule. Board Member Mundinger seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None Consider Award of Contract for Air Conditioning Replacement/Roof Repairs Three bids were received on replacement of the air conditioning unit as follows: Contractor Base Bid (No Roof Work) Ainsworth & Co. $93,725 Derryberry's Inc. $41 ,709 Young Plumbing & Heating Company Inc. $61,045 Two bids were received for roof repairs/replacement as follows: Partial Roof Total Roof Contractor Replacement Replacement Michalsky Roofing Company, Inc. $9,000 $30,882 Oates Industries No Bid $63,557 • 950823-3 Minutes of the BAWA Meeting - August 23, 1995 • There are substantial differences in both project bids, but James A. Davis, Consultant on the project, has verified the stability of both companies. Derryberry's is just completing a $2,000,000 project in Texas City and is in the process of bidding a job exceeding $3,000,000. Michalsky's has been in this area for years, and has performed a substantial amount of work at Exxon. The original cost estimate on replacement of the air conditioning system alone was $70,000; therefore, for $2,000 more both projects are feasible. Mr. Davis recommended acceptance of the low bidder on each project. Board Member Mundinger moved to accept the bid of Derryberry's Inc. for the amount of $41,709 for air conditioning replacement unit. Board Member Beavers seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None Board Member Buenz moved to accept the bid of Michalsky Roofing Company, Inc. for total roof replacement in the amount of$30,882. Board Member Beavers seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None Lead time on installation of the air conditioning unit is approximately ninety days. Michalsky's would like to do the roof work prior to the air conditioning work. The air conditioning unit will come with new flashing. Therefore, work is expected to begin in about two months. Consider Award of Contract for Construction of Ground Storage Tank Two bids were received for construction of 4.5 million gallon ground storage tank as follows: Contractor Base Bid Advance Tank $1,458,948 • Tank Builders, Inc. $1,282,500 MPG Construction No Bid 950823-4 Minutes of the BAWA Meeting - August 23, 1995 1111 Mr. Thomas explained that due to the TNRCC rules relating to contact time and disinfection, BAWA needs more finished water. The best way to accomplish this is installation of another ground storage tank as opposed to modifications to the plant. Wayne Smith &Associates designed the tank and bids were solicited. Bids came in higher than anticipated. The low bidder, Tank Builders, Inc. is the same company that built the original tanks at BAWA. In 1985 the cost of a tank was $535,000. BAWA does not have adequate funds; therefore, Mr. Thomas asked that the Board postpone any action to allow time for the staff and consultants to review the options--tank sizes, time for tank construction, types of materials, and construction methods. In accordance with the staff request, the Board took no action. Consider Authorizing Assignment of Surveying, Inspection, and Testing of Ground Storage Tank Construction Project to Wayne Smith & Associates Previously, the Board authorized Assignment No. 1 for the design of the ground storage tank for a lump sum of $24,000. Board approval is necessary for the surveying, inspection and testing necessary for the remainder of activities related to building the tank over and above the design work. The administration recommended approval of Assignment No. 2 to Wayne Smith & Associates for the amount of $32,000. Board Member Mundinger moved to authorize assignment of surveying, inspection and testing of ground storage tank construction project to Wayne Smith & Associates. Board Member Buenz seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None Consider Approval of 1995-96 Budget Fred Pack reviewed the proposed 1995-96 BAWA Budget. The Revenue and Expenditures Summary reflects a slight increase in revenues for 1995-96 due mainly to the annexation of MUD No. 3. The budget is based on an average of eleven million gallons per day flow; last year the estimate was 11.058 mgd. Raw water purchases are decreased due to the revised contract with the City of Houston. The proposed budget includes a 5% increase in the rate for raw water purchases. This is an estimate because no notice has • been received from the City of Houston of an increase. 950823-5 Minutes of the BAWA Meeting - August 23, 1995 • Under Budget Expenditures Summary, Personal Services includes the new compensation program proposed under the City of Baytown Budget for the employees. Chemicals have increased due to a new chemical needed to increase the PH of the water and due to the increase in cost of chemicals. The Maintenance Section has been decreased because of the replacement of the settling tubes during the 94/95 fiscal year, while the Services Section has been decreased due to the decrease in Insurance costs. Capital items include Office, Desk, Computer Desk, and related shelving, a new potassium permanganate feeder, replacement of a large vault chemical tank and a power vent in the sludge galley. The staff recommended approval of the proposed 1995-96 BAWA budget which contains no rate increase. Board Member Fuller moved for adopting of the 1995-96 BAWA Budget. Board Member Buenz seconded the motion. The vote follows: Ayes: Board Members Beavers, Buenz, Fuller, Gillette and Mundinger Nays: None As part of the budget discussion the General Manager asked Monte Mercer, Director of Finance/Administrative Director, to discuss the financial statements. The balance sheets reflected that BAWA has available about twenty days of cash on hand. A minimum cash on hand is recommended at thirty days, but BAWA's debt will be completely paid off in the year 2003; therefore, the Finance Department feels confident with this amount of cash on hand. One substantial change was noted under Retained Earnings reserved for Debt Service which goes from $604,411 on September 30, 1994, to $253,947 on June 30, 1995. The reason for that decrease is that September has an additional three months of accrued cash. The money is set aside in a Sinking Fund to pay the debt on November 1; therefore, there is three months less cash accumulated. The other number which reflects noticeable difference under Total Current Assets, Restricted Cash and Investments, is $604,411 available September 30, 1994 and $1,032,921 available June 30, 1995. This is due to bonds sold for construction of the projects discussed earlier. The Income Statement reflects BAWA is about 69% where anticipated for the end of the 1994- 95 fiscal year. This is not unusual. There is a lot of activity in the last two months of the year. The City of Baytown comprises about 89% of total revenues for BAWA with approximately 65% revenues expended for raw water purchases and debt service--30% attributable to Debt Service; and 35% attributable to raw water purchases. These two items drive the BAWA budget. • Mr. Mercer introduced Donna Sams, Controller for the City, who was responsible for the compilation of the Financial Statements. 950823-6 Minutes of the BAWA Meeting - August 23, 1995 • Adjourn There being no further business to be transacted, the meeting was adjourned. Peter R. Buenz Secretary c:\wpwiNsompoocs\mINUTES\8-23-95.BAW •