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1989 06 22 BAWA Minutes 890622-3 Minutes of the BAWA Meeting - June 22, 1989 • The board concurred that if there is no problem, the take or pay provision should be omitted from the contract. Plant Manager 's Report Fritz Lanham Water Treatment Plant - Monday or Tuesday at 3:00 a. m. , the plant took a lightning hit which destroyed fuses, two lightning arrestors, and a stand off insulator. The plant was down from 3:00 a. m. to about 10:00 a.m. However , the plant supplied water through the diesel operation. • Distribution - Average distribution for the month of May was 9. 35 mgd. For the year , the average is 9. 4 mgd and during the summer months should be 10 mgd. Currently, BAWA is using about 9.5 mgd, but must take 10 mgd; therefore, BAWA is spending about $55,000 a year for water which is not being sold. The next take or pay is 13 mdg. If BAWA is able to sell to these three entities, that will equal about 200,000 gallons per day; therefore, at the very best scenario, when BAWA hits the 13,000,000 gallon take or pay, BAWA may be selling anywhere from 10 to 11 million gallons per day. That would mean that BAWA will be purchasing about 3,000,000 gallons per day that is not sold which equals to $360,000 a year. Board member Buenz suggested that BAWA start talking to the City of Houston concerning this problem. Bobby Rountree, Acting City Manager , explained that the staff has spoken with City of Houston representatives in this regard. Houston 's solution to the problem is that BAWA buy in to CIWA; however, this alternative would cost several million dollars. Norman Dykes suggested that BAWA could take a more aggressive attitude with regard to obtaining customers, for instance Mont Belvieu. Also there would be the potential of selling to area industries. Herb Thomas pointed out that as operating costs increase, the cost to the consumer must increase. At the $360,000 per year , the cost for water would need to be increased by about 10 cents. • •