2025 05 07 BAWA Minutes, SpecialMINUTES OF THE SPECIAL MEETING OF THE BOARD OF DIRECTORS
OF THE BAYTOWN AREA WATER AUTHORITY
May 7, 2025
The Board of Directors of the Baytown Area Water Authority (BAWA) met in a Special Meeting
on May 7, 2025, at 4:30 P.M., in the Council Chamber of the Baytown City Hall, 2401 Market
Street, Baytown, Texas with the following in attendance:
Brenda Bradley Smith
Jimmy Smith
Alyssa Linares
David Start, Jr.
Brant Gary
Kristin Holmes
Gabriella Gonzales
President
Secretary
Director
Director
Assistant General Manager
Assistant General Counsel
Acting Assistant Secretary
President Brenda Bradley Smith convened the May 7, 2025, BAWA Board Special Meeting with
a quorum present at 4:38 P.M., all members were present with the exception of Vice President
Frank McKay III who was absent.
1. CITIZEN COMMENTS
President Brenda Bradley Smith announced no one signed up to speak.
2. MINUTES
a. Consider approving the minutes of the Baytown Area Water Authority Special
Meeting held on January 30, 2025.
A motion was made by Secretary Jimmy Smith, and seconded by Director Alyssa Linares to
approve the Baytown Area Water Authority Special Meeting minutes held on January 30, 2025,
as submitted. The vote was as follows:
Ayes: President Brenda Bradley Smith, Secretary Jimmy Smith, Director Alyssa
Linares, Director David Start, Jr.
Nays: None
Other: Vice President Frank McKay III (Absent)
Approved
BAWA Board Special Meeting Minutes
May 7, 2025
Paiae 2 of 6
3. PROPOSED RESOLUTIONS
a. Consider a resolution authorizing a new Untreated Water Supply Contract with the
City of Houston.
Director of Public Works and Engineering Frank Simoneaux presented Agenda Item 3.a. and
stated this proposed resolution is to approve a new Untreated Water Supply Contract with the
City of Houston and the primary purpose of the contract is to modify the contract expiration date
to match the terms of the 30-year bonds to be issued in 2025, which would be an expiration date
of December 31, 2055. As this is a requirement to issue the bonds for BAWA East Expansion
Project. Additionally, Mr. Simoneaux stated the City of Houston has a new contract form that is
required, and for the current operations there would not be any substantial changes; however, in
the future there might be some impact if we request additional capacity. In which there is a
clause in the new contract that states we would have to pay for that additional capacity
reservation even if it's not used. However, we do not foresee needing additional capacity as we
do not plan on another BAWA East expansion until after 2040.
Director David Start, Jr. asked for clarification in regard to this item issuing bonds and Agenda
Item 3.b. refers to State Water Implementation Fund for Texas (SWIFT) and Mr. Simoneaux
responded that if the SWIFT application does not go through they would issue debt, but their
intent is to utilize the SWIFT loan. Further, Director Start, Jr. asked for clarification concerning
the clause involving return flows that belong to the City of Houston and Mr. Simoneaux stated
we shouldn't have return flows, and this verbiage is part of their standard contract.
A motion was made by Secretary Jimmy Smith, and seconded by Director David Start, Jr. to
approve Resolution No. 2025-3, related to Item 3.a. The vote was as follows:
Ayes: President Brenda Bradley Smith, Secretary Jimmy Smith, Director Alyssa
Linares, Director David Start, Jr.
Nays: None
Other: Vice President Frank McKay III (Absent)
Approved
RESOLUTION NO. 2025-3
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE BAYTOWN
AREA WATER AUTHORITY AUTHORIZING A NEW UNTREATED
WATER SUPPLY CONTRACT WITH THE CITY OF HOUSTON,
CONSOLIDATING THE PREVIOUS FOUR (4) CONTRACT AMENDMENTS
AND MODIFYING THE CONTRACT EXPIRATION DATE TO DECEMBER
3112055; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF.
BAWA Board Special Meeting Minutes
May 7, 2025
Page 3 of 6
b. Consider a resolution authorizing the submission of a State Water Implementation
Fund for Texas (SWIFT) loan application to the Texas Water Development Board (TWDB)
in the amount of $69,000,000.00, for the Baytown Area Water Authority East Surface
Water Treatment Plant Phase II Expansion Project.
Director of Public Works and Engineering Frank Simoneaux presented Agenda Item 3.a. and
state this proposed resolution authorizes the Baytown Area Water Authority (BAWA) to submit
a State Water Implementation Fund for Texas (SWIFT) loan application and execute all
necessary documents related to the East Surface Water Treatment Plant Phase II Expansion
Project. The City is seeking funding under the Texas Water Development Board's SWIFT
program to support the proposed expansion, which will increase the plant's capacity by 6 Million
Gallons per Day, bringing the total to 12 Million Gallons per Day (MGD).
Director David Start, Jr. asked for clarification as it relates to the bond rates for the SWIFT loan
and Ms. Lindsey Kovar, Senior Project Manager with BGE, Inc. (Owner's Advisor) approached
the podium and stated these loans are typically below the market rate as they are subsidized.
Also, Mr. Jonathan Frels with Bracewell LLC clarified that if you receive a SWIFT loan from a
Water Development Board you are going to issue revenue bonds to Water Development Board to
evidence that loan; therefore, as we talk about bonds and loans they are all one thing because
they have to get some instrument back from the Water Authority to evidence the loan they are
giving. Therefore, later this year you will receive a scale of the subsidized rates are for these
types of projects. Lastly, Director Start, Jr. stated for clarification that revenue bonds are going to
be issued regardless, if this SWIFT application is approved or not and Mr. Frels concurred to his
statement and further clarified the only difference is whom you will sell the bonds to, as well as
the process, and the interest rate would be the largest difference.
A motion was made by Director David Start, Jr., and seconded by Director Alyssa Linares to
approve Resolution No. 2025-4, related to Item 3.b. The vote was as follows:
Ayes: President Brenda Bradley Smith, Secretary Jimmy Smith, Director Alyssa
Linares, Director David Start, Jr.
Nays: None
Other: Vice President Frank McKay III (Absent)
Approved
4.
RESOLUTION NO.2025-4
BAWA Board Special Meeting Minutes
May 7, 2025
Page 4 of 6
IUb&n_ot %
Re, I It,
Application Filing and Authorized Representative Resolution
A RESOLUTION by the Board or Dveelors of die
Baytown Area Water Authority _ requesting financial assistance from the Texas \\ ater
Dc\clopment Board. authorizing the filing or an application for assistance: and making cenain findings in
connection there"ith.
BE IT RESOLVED BY THE Board of Directors _ OF
rHL Baytown Area Water Authority
SECTION I That an application is hereby apprtned and authurized Ito he filed scidt the Teas \\ater
Dc\clupment Board seeking financial assistance in an amount not to exceed S69.000.000 to pro%tde
for the casts or water system improvements. including the BAWA East SWTP Expansion Project
SECTION 2 That the person 5M ng as one Pres den' of ew Owed of (Mec:ws or ha or her designee he and is heroh%
designated the audnrieed reprcsentame of the Baytown Area Water Authority _— lir porpo.cs
of lirnishing such utfimuatitco and e\ccutinc such document a, may be required tit connection milt the preparation
and filing of such application fir lnancial asmsiance and the Odes of the I e\as \\ ater De%elopment Hoard
5ECTI0\ : that the fidfatsing fines and utdinulual. are hereby authortzed and directed h, aid and assist
in the preparation and suhinicsimt tit' such application and appear tin hehalr ul' and represent the
Baytown Area Water Authority before am hearine held by the I e\as \\ ater
Dc\clopownt Board tin rich application. hi tin
financial \dstitif Joseph W Morrow. Hilltop Securities, Inc.
700 Milam St.. Suite 1200. Houston, TX 77002
f itgiiteer Lindsay Kovar. PE. BGE Inc
10777 Westhetmer. Ste 400 Houston. TX 77042
Bond c otinsel Jonathan K. Frels. Bracewell LLP
711 Louisiana St.. Suite 2300, Houston, TX 77002
\\\t11u tir1S 5ED \\D APPRO\ ED. this the 1}y day of M 1 'D
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REPORTS
a. Receive a report on the status of the Baytown Area Water Authority East
Expansion Project.
BAWA Board Special Meeting Minutes
May 7, 2025
Page 5 of 6
Ms. Lindsay Kovar, Senior Project Manager with BGE, Inc. (Owner's Advisor), presented the
status report for the Baytown Area Water Authority East Plant Expansion Project. She
announced they have received 30% base design form BWP they provided some comments on it
and overall, they were satisfied with the design, and now that they have our comments they are
moving to the 60% design submittal. Additionally, they have received the 30% baseline cost
model, and they submitted comments last week. They have a workshop scheduled with them for
tomorrow. Ms. Kovar stated they anticipate they should have 60% design to be complete
sometime this summer, in which at that time we will start to negotiate the guaranteed maximum
contract price. Lastly, Ms. Kovar mentioned the previous item that was approved under Agenda
Item 3.b. was to apply for the SWIFT loans and if we received approval of the SWIFT loans,
there would be additional items before the Board related to the SWIFT loans.
b. Receive the Baytown Area Water Authority Quarterly Financial and Investment
Reports for the Quarter Ending September 30, 2024.
Director of Finance Teresa McKenzie presented the Baytown Area Water Authority's Quarterly
Investment Report for the Fourth Quarter Ending September 30, 2024, and stated the report is
out of order since the Board has already received the audit report at their January 30, 2025
meeting; therefore, she provided the following overview of the report:
• Budget Revenue came in at $21.6 million which is 130% over what was budgeted;
• Expenditures were at 107% over what was budgeted, thereby leaving a Working Capital
Balance of $10.9 million;
• Capital Improvements Program came in at $2.4 million; and
• Earnings ended at $385,000 with a Book Value balance of $14,259,000.
C. Receive the Baytown Area Water Authority Quarterly Financial and Investment
Reports for the Quarter Ending December 31, 2024.
Director of Finance Teresa McKenzie presented the Baytown Area Water Authority's Quarterly
Investment Report, for the First Quarter ending December 31, 2024, and provided the following
overview of the report:
• Budget Revenue came in at $5.2 million which is 25% for what was budgeted;
• Expenditures were at $5.5 million which is 28% of what was budgeted, thereby leaving a
Working Capital Balance of $10.6 million;
• Capital Improvements Program came in at $3.5 million; and
• Book Value for Investments ended at $10.8 million with Investment Earnings at
$1409000.
5. MANAGER'S REPORT
a. The next Baytown Area Water Authority meeting is scheduled for Wednesday, June
18, 2025, at 4:30 p.m., in the Council Chamber located at City Hall, 2401 Market Street,
Baytown, Texas 77520.
BAWA Board Special Meeting Minutes
May 7, 2025
Page 6 of 6
Assistant General Manager Brant Gary stated there was nothing to report at this time and
reminded the Board Members of their next Baytown Area Water Authority meeting, scheduled
for Wednesday, June 18, 2025, at 4:30 P.M., in the Council Chamber at City Hall.
6. ADJOURN
A motion was made by Director Alyssa Linares, and seconded by Director David Start, Jr. to
adjourn the May 7, 2025 Baytown Area Water Authority Board Special Meeting at 4:58 P.M.
The vote was as follows:
Ayes: President Brenda Bradley Smith, Secretary Jimmy Smith, Director Alyssa
Linares, Director David Start, Jr.
Nays: None
Other: Vice President Frank McKay III (Absent)
Approved
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