Ordinance No. 16,209 ORDINANCE NO. 16,209
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS, APPROVING THE BUDGET FOR THE BAYTOWN AREA WATER
AUTHORITY (BAWA) FOR THE FISCAL YEAR BEGINNING OCTOBER 1,
2025, AND ENDING SEPTEMBER 30, 2026, AND PROVIDING FOR THE
EFFECTIVE DATE THEREOF.
WHEREAS, the Board of Directors of the Baytown Area Water Authority ("BAWA") has
adopted a budget for BAWA for the fiscal year beginning October 1, 2025, and ending
September 30, 2026, and
WHEREAS,the General Manager of BAWA has submitted said budget to the City Council
of the City of Baytown for approval; and
WHEREAS. after ffi11 and final consideration, it is the opinion of the City Council of the
City of Baytown that the budget should be approved; NOW THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1: That the City Council of the City of Baytown, Texas, hereby approves the
budget of the Baytown Area Water Authority for the fiscal year beginning October 1, 2025, and
ending September 30,2026. A copy of the above-referenced budget for BAWA is attached hereto,
marked Exhibit "A," and made a part hereof for all intents and purposes.
Section 2: This ordinance shall take effect immediately from and after its passage by the
City Council of the City of Baytown.
INTRODUCED, READ and PASSED by the affirmative vote of the City Council of the
City of Baytown this the Wad day of August, 2025.
IARLES SON, Mayor
EST:
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ANGEL 0hr City'C.
APPROVED S
SCOTT LEM ND, City Attorney
Approving 2025-2026 Budget.BAWA.vh.docx
EXHIBIT "A"
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FY2026 PROPOSED BUDGET
OBJECTIVEBAYTOWN AREA
WATER AUTHORITY
Overview
BaytownThe Area Water Authoritypresides over wholesale
supplierof • its facilities, equipment and supplies.
DUTIES
Discuss all matters pertaining to the business of the Authority, including the
vetting of • purchase of • facilities, and matters relating to the
construction work.
Our Mission Con�i�ues
Wife
V vet the years, we have dedicated ourselves to producing drinking water that meets all
state and federal standards. We continually strive to adopt new methods for delivering the
°- � ,Y best-c}uality drinking water to yott. Fls new chat-lenges to drinking water safety emerge,
}i we r<main vigilant in meeting the goals uF source water protection, water conservation,
and cornrr�unity education while continuing to serve the ne4ds of all our water users.
Vter Sales - Baytown
FY2026 PROPOSED BUDGET
BAWA
Budget Executive Summary
This fund accounts for the operations of the Baytown Area Water Authority (BAWA).
BAWA is a water authority created by the Texas Legislature to supply water for the City of
Baytown (City) and surrounding communities. BAWA services a total of eight customers
with the City as the largest customer, generating approximately 90% of BAWA's annual
sales. BAWA is a separate legal entity; however, it is considered a component unit of the
City. Since it began operating, BAWA has not experienced shortages of its raw water
supply to the plant or interruptions of service to Its customers,
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BOARD OF
DIRECTORS
IROR frank McKay III
Vice President
Jimmy Smith,
Secretary
Brenda BradleySmith paved Stan,
President birector
� Alysa Linares,
Director
Angela Jackson,
Assistant Secretary
FY2026 PROPOSED BUDGET
BUDGET
EXECUTIVE SUMMARY
Revenues
For FY2026, the revenue projections for water sales and investment interest have been
developed based on updated rates, consumption estimates, and anticipated market
conditions.
Water Sales — Baytown
Projected revenue for Baytowr water sales is $20,344,606. This estimate reflects a 6.7%
rate increase, raising the water rate to $3.89 per 1,000 gallons in accordance with the
adopted BAWA rate policy. Consumption projections are grounded in a three-year
historical average, resulting in an estimated total of 5.22 billion gallons for FY2026.
Water Sales —Other Customers
Revenue from outside customers is projected at $1,729,730 for FY2026 This projection
incorporates a 6.7% rate increase to $4.14 per 1,000 gallons. Consumption estimates are
also based on a rolling three-year average, with an expected total of approximately 418
million gallons.
Investment Interest
Investment earnings are budgeted at $372,915 for FY2026. This figure is driven by
improved interest rate conditions and investments balance carried into the fiscal year. The
increase over prior years is attributed to stronger year-to-date returns and an outlook of
continued market stability.
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FY2026 PROPOSED BUDGET
BUDGET
EXECUTIVE SUMMARY
Expenses & Working Capital
Operating Expenses: Expenses grow from $9.92M (FY25 budget) to $13.96M (FY26
budget), largely driven by higher supplies.
Non-Operating Expenses:
Transfers Out — Debt Service: Slight decrease in FY26 compared to FY25 budget,
likely tied to amortization schedules or refinancing.
Transfers Out — Capital Improvement: Large reduction in FY26 ($2.04M) compared to
FY25 ($4.37M), ind cating fewer planned capital projects or completion of major work
in prior years.
. Transfers Out— General Fund: Consistent at $350K annually.
The total expense for FY26 are proposed at $21.77M. down from the FY25 estimate of
$23 56M, due mainly to reduced capital transfers.
Working Capital Ending: FY26 projected at $9.57M, an improvement from FY25.
Days of Operating Expenses: BAWA will have about 250 days of operating expenses in
reserve for FY26, reflecting good fiscal health.
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Commitment
C01IStAlit goal is to provi(ic ytm with a %afe an(l. ilepcndable supply of(Irinking water. We want you to
understand the cfforts �,vc make to c(intinually iniprove the water trcarment procc�s and protect our water
FY2026 PROPOSED BUDGET
BAYTOWN AREA WATER AUTHORITY FUND 3500
BUDGET SUMMARY BY FUND
i
Revenues
Sale of Water - Bavtown S 18,401.642 S 19.197.497 S 19.438.808 S 20.344.606
Sale of\eater - Other 1.764347 1,954 333 1.01,166 1,724,730
interest Revenue 327.517 90,000 367.381 372.915
Federal ContrEbtition - - 126,106
Transfers In Ftoln\V\VIS Fund 100.000 -
Transfers in FE oni B CIP 307,004 -
Transfers In From BALPA 2024 Rey' Boe 664,049 -
Total Revenues 21.56.3.320 21.241,830 21.583,465 22.447,251
Expenditures
Pei sonnet �,[,V +:es 2.021.979 2.292.431 2,292.451 2.349,762
Supplies 7.844.515 0.060.032 9.676.470 10.041.291
MainteEla11+ T 330.049 586.952 429.150 429.150
Services 1.142.968 981.444 981.444 1.1.4.046
Ski lid I%. - - -
Total Operating 11.339 512 9 920.899 13.379,515 13,964,249
Non-Operating Expenditures
Capital Outlay
Transfers Out - D,ebt S?rvice 4.133.994 5,459,283 .9.459.283 1.410.219
Transfers Out Capital Itllpl'0%_e111etlt 1,368,290 4.308.290 4.368.290 2.044.000
Transfers i tut - Genei,al Ftnld 10.000 350,000 350.000 350.000
011tin yel1CC - - - -
Tcjtal Erpendittites 1/.191.790 20.098.472 23.557.g88 21.768.46y
Excess(Deficit) Revenues
Over Expenditures 4.373.524 1.143.358 (1.973.o24) 678.783
G GAF' to bud-et basis adill5tllleilt (1.070.504) - -
Working Capital - Beginning 7.;63.338 10 866,35S 10,866.358 8.892.734
Working Capital - Ending S 10.S66.338 S 12.009.716 S 8.892.734 S 9.571.517
Days of Operating Expenditures 350 442 243 250
- - � - -- --- FY2026 PROPOSED BUDGET
BAWA CIP
BAWA Capital Improvement Projects Fund
The Capital Improvement Program (CIP) for BAWA is funded through the issuance of
revenue bonds, grants, and revenue from operations.
FY2025-26 Projects
. BAWA Backwash and Decant Pump Replacement: $1,300,000
o This project will replace the existing decant and backwash pumps and motors to
increase reliability and control of surface water sludge processes.
• BAWA Main MCC3: $225,000
o MCC3 Electrical Upgrade
No new capital expenditures are planned for the following projects in FY2025-26 (funding
or construction was previously appropriated):
• BAWA Raw Water Rehabilitation - This project would replace the existing
BAWA Forebay liner, raw water pumps and motors with variable frequency drive
(VFD) pumps/motors at the Fritz Lanham Surface Water Plant,
• BAWA East Plant II Expansion - Construction and design of a six (6) million
gallons per day (MGD) expansion of the existing surface water treatment plant
south of Interstate Highway (IH)10 and west of SH 99 along the Coastal Water
Authority (CWA) Barbers Hill Canal.
o BAWA Administration Building - Perform a minor remodel of office space
updating the finishes, and replace the HVAC system, replace the roof, plumbing
upgrades, and electrical upgrades
o BAWA Condition Assessment - Condition Assessment Report determines the
remaining useful life of various capital assets, and helps program future projects
o BAWA Filter Scour - To install an air scour system in the dual media filter of the
Baytown Area Water Authority Fritz Lanham Water Treatment Plant (BAWA
WTP).
o BAWA Sedimentation Basin Improvements- Project includes structural repairs
to sedimentation basins, replacement of chain and flight sludge collector
mechanisms, instrumentation and appurtenances.
o BAWA Chemical Feed System - Project includes structural repairs to the
chemical feed building, replacement of one chlorine exhaust fan, and replacement
of the North Ferric Tanks.
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BAYTOWN
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FY2026 PROPOSED BUDGET
BAWA-CAPITAL IMPROVEMENT PROGRAM FUND 3510
BUDGET SUMMARY BY FUND
Revenues
Transfer In -Operating S 1.368.290 S 4.368.290 $4.368,290 $1.525.000
Interest Revenue 59.239 -15.000 95.308 80.000
Total Revenues 1.427,529 4.413,290 4.463,598 1.603,000
Expenditures
BAWA2502 Condition.assessment - 310.918 310.918
BAWA1901- Filter Scour 2,171 - -
BAWA2103- Raw Water Rehabilitation 141.935 233,628 233.628
BAW-\2401- East Plant it Expansion 1K52.954 1.302.500 1.302.500
BANVA2402- Administration Buildnng - 143.481 543.481
BAIT'a2301- Backwash and Decant Pump -
Replacement - 3.742,082 3.742,082 1.300,000
BAWA2661- BAWA Alain Nl((:3 225.000
B:111',a2(i01 Sedimentatio�� Basin Imp 465.000
BAWA2604- Chemical Feed Svstem 54.000
Total I-vpenditures 307,064 6.132.609 6,132.609 2.044,000
Excess(Deficit)Revenues
Over Expenditures 1.120.465 (1.719,319) (1.66Q 011) (439 000)
Working Capital Beginning 1.307.390 2.427.855 2.427.853 758,844
Working Capital- Ending S 2.427.8,55 S 708.536 $ 7,58.844 S 319.844
e A'
- FY2026 PROPOSED BUDGET
DEBT SERVICE
For the year ending September 30, 2026
BAYTOWN AREA NVATE R AUTHORITY REVENUE BONDS
LONG TERM DEBT A\IORTIZATION SCHEDULES
Principal Principal&Interest Principal
Revenue Amount of Outstanding Requirements for 202}26 Out-standing
Bonds Issue Oct. 1.2025 Principal Interest Total Sept.30, 2026
Senes 2012 8.315.000 2, 515.000 325;000 S21919 401.919 2:190.000
Senes 201 S 22.040,000 182700,000 1.000.000 839.650 1.839.650 17.700.000
Senes2019 17.315;000 13.320000 755;000 431.650 1,186,650 12.565000
5enes 202 1 -'1.525,000 20 520.000 950;000 1.026.000 1-976,000 19,5 70.000
S 55.055.000 S 3:030.000 S 2.380,219 S 5.410.219 S 52.025.000
Comb , Maturity
111
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111 il. Interest
Trincipal
2.
11
11
2025 202612028 0 i t 2031 AL12 203312036 0 !38 2039 204D
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FY2026 PROPOSED BUDGET
DEBT SERVICE
For the year ending September 30, 2026
Combined B NVA Debt,All Series
Debt Req uirem ents to .1Laturity
Fiscal Principal Total Total
Year -5`01 Interest Requirement
2025 3.043.000 2.414.283 3.439.283
202.6 3,030,000 2,3Ak,
2027 3,120.000 2.242.769 5,362.769
2028 3,210,000 2:100,900 3.310.900
2029 3.330.000 1.954.385 ; 304.388
2030 3_500.000 1.801.S88 5_301 SSS
2031 3.6-5-5.000 1.650.500 5.305.500
2032 3.S 15.000 1.491.723 5.306.72;
2033 3 980.00C 1.325 600 5.303.V1)
2034 4:160.000 1:145.900 3.303.900
203-; 4.330:000 97>.400 3.303.400
2 03 6 4.310.000 79�.700 5.307.700
2037 4.690.00C, 612.3�0 3.302.330
2038 4.880.000 419.330 3.299.334
2039 2.945 000 21S.250 3.163.250
2040 1.SS0.000 94,000 1,974,000
Total S 58.100.000 S 21.623.421 S 79.723.421
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