2010 01 28 WS MinutesMINUTES OF THE REGULAR WORK SESSION OF THE CITY COUNCIL OF
THE CITY OF BAYTOWN
January 28, 2010
The City Council of the City of Baytown, Texas, met in a Regular Work Session on
Thursday, January 28, 2010 at 4:30 P.M. in the Council Chamber of the Baytown City
Hall, 2401 Market Street, Baytown, Texas with the following in attendance:
Lena Yepez
Council Member
Lynn Caskey
Council Member
Brandon Capetillo
Council Member
Terry Sain
Council Member
David McCartney
Council Member
Scott Sheley
Council Member
Stephen DonCarlos Mayor
Garrison C. Brumback City Manager
Bob Leiper
Deputy City Manager
Kevin Troller
Assistant City Manager
Ignacio Ramirez
City Attorney
Leticia Garza
City Clerk
Keith Dougherty
Sergeant at Arms
Mayor DonCarlos convened the January 28, 2010, Regular Work Session of the City
Council with a quorum present at 4:30 P.M.
1. DISCUSSION
a. Discuss BAWA and City of Baytown Utility Rate Studies - Administration.
City Manager, Garry Brumback presented the agenda item to receive guidance and
discuss the City of Baytown and the Baytown Area Water Authority's utility rate studies
conducted by Mr. Mike Burton of Burton and Associates.
In a joint meeting with the BAWA Board, the utility rate studies (City and
BAWA) recently completed by Burton and Associates was presented. It is important for
the City Council and BAWA Board to discuss these studies jointly since the BAWA rates
for treated water have a significant impact on City of Baytown utility rates.
Page 2 of 4 Minutes of the January 28, 2010 City Council Work Session
As was discussed during the budget adoption in September 2009, the consideration of a
utility rate increase was deferred until the completion of the engineering analysis of
BAWA's plant facilities to develop future capital needs, and resulting rate studies for
both entities. This Work Session is preparatory to consideration of rate increases to
become effective around April 01, 2010.
Mr. Burton stated that some of the challenges that BAWA face are: meeting increasing
cost requirements such as ongoing increases in raw water supply, large cost increases to
certain major operating expenses, smaller increases to other operating expenses, and $20
million of capital projects (FY2011- FY2015); and satisfying appropriate financial
planning policies.
Mr. Burton presented the BAWA results for the (5) year plan of rate adjustments and
rates as the following:
Scenario 1— Tareet 1.5
FY2011 FY2012 FY2013 FY2014 FY2015
Rate Increase 16% 8.5% 8.5% 7.5% 7.5%
In -City Rates $1.98 $2.15 $2.34 $2.51 $2.70
Scenario 2 — Tareet 1.0
FY2011 FY2012 FY2013 FY2014 FY2015
Rate Increase 8.5% 8.5% 8.5% 7.5% 7.5%
In -City Rates $1.86 $2.01 $2.18 $2.35 $2.52
Mr. Burton recommended establishing debt service coverage target rates of Scenario Two
(2) with updating analysis annually or bi- annually.
Mayor DonCarlos recommended Scenario Two (2) with a target rate of 1.3 to get BAWA
the upgrades needed for the facility.
Director Baldwin recommended a gradual increase over time.
Mr. Burton stated that some of the challenges that the City of Baytown face are: meeting
increasing cost requirements, such as: (1) increases in treated water supply costs from
BAWA, (2) large cost increases to certain major operating expenses, (3) smaller increases
to other operating expenses, and (4) funding of capital projects; and satisfying
appropriate financial planning policies.
Mr. Burton presented the City of Baytown results as the following:
Scenario One (1): Rate Revenue Adjustments beginning in FY2010 on 411110
(FY2011 adjustments beginning on 11112011)
Includes FY2010 rate design modifications to minimize impacts to
low /average users
Page 3 of 4 Minutes of the January 28, 2010 City Council Work Session
Scenario Two (2): No Rate Adjustments until FY2011
Plan of Rate /Revenue Adjustments and Average Residential Bill (6 000 gal.)
Scenario One (1)
FY2010 FY2011 FY2012 FY2013 FY2014 FY2015
W &S Rev. 5.85% 5.85% 5.85% 5.85% 5.85% 5.85%
Avg. Bill $61.80 $65.41 $69.24 $73.29 $77.58 $82.12
Scenario Two (2)
FY2010 FY2011 FY2012 FY2013 FY2014 FY2015
W &S Rev. N/A 8.5% 8.5% 8.5% 5.50% 5.50%
Avg. Bill $61.98 $67.25 $72.96 $79.17 $83.52 $88.11
Mr. Burton recommended adopting the rate revenue adjustment plan of Scenario One (1)
FY2010 rate design and updating analysis annually or bi- annually. Council Member
Capetillo recommended Scenario Two (2), while Council Member McCartney
recommended Scenario One (1).
In response to Council discussion, Mr. Burton started that he would research RV Park
rates and provide for Council in the near future.
Mr. Leiper indicated that the water conservation plan adopted by Council in June 2009
was rejected by the State because it did not have specific consumption reduction
guidelines, which is being covered through this study; therefore an amendment
addressing this issue will be brought back before Council this month for approval.
2. APPOINTMENTS
a. Urban Rehabilitation Standards Review Board (URSRB) - City Clerk.
City Manager, Garry Brumback presented the agenda item to discuss three
(3) appointments to the Urban Rehabilitation Standards Review Board.
The URSRB is a seven (7) member board appointed by City Council and is composed of
an architect or engineer, a mortgage loan banker, a building contractor, a social or
welfare worker and (3) interested citizens. Members serve (2) year terms and terms are
unlimited.
There are three (3) members whose terms will expire on February 28, 2009, and they are:
Porter Flewellen, interested citizen
Tom Hard, interested citizen and
David Mohlman, social or welfare worker.
Council Member Sain has a citizen application that is interested in serving on this Board.
Page 4 of 4 Minutes of the January 28, 2010 City Council Work Session
3. ADJOURN
Mayor DonCarlos adjourned the January 28, 2010, Regular Work Session of the City