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FY 08-09 BAWA Adopted BudgetBaytown Area Water Authority (BAWA) ANNUAL PROGRAM OF SERVICES 2008 -09 ADOPTED BUDGET Submitted To Baytown Area Water Authority Board September 17, 2008 Garry Brumback General Manager Fred Pack Plant Manager Andrea Deaton Interim Director of Finance BAYTOWN AREA WATER AUTHORITY BOARD OF DIRECTORS PETER R. BUENZ, President DAN M. MUNDINGER, Vice President ROBERT L. GILLETTE, Secretary .JOHN R. SANDHOP WAYNE BALDWIN BAYTOWN AREA WATER AUTHORITY 7425 Thompson Road, Baytown, Texas 77521 -1056 (281) 426 -3517 FAX (281) 426 -3519 August 20, 2008 President and Members of the Baytown Area Water Authority Board Baytown Area Water Authority Baytown, Texas It is my pleasure to present the 2008 -09 Adopted Budget for the Baytown Area Water Authority (BAWA) Board. The Budget sets forth the revenues and appropriations for the fiscal year October 1, 2008 through September 30, 2009. The financial guidance provided by the Board has resulted in BAWA's ability to maintain a stable financial position exhibited by a healthy working capital balance. BAWA's largest current project, the construction of a second water supply line serving the City of Baytown, is funded partially from nonrecurring revenues to reduce the amount of debt issued. This project, which is nearing completion, will provide reliability to BAWA's largest customer, the City of Baytown, which currently constitutes approximately 88% of BAWA's water sales. BAWA was approved for and has closed on a loan with the Texas Water Development Board (TWBD) for funding of the second water supply line and Phase II improvements. The loan received from the TWDB Drinking Water State Revolving fund has interest rates ranging from 2.25% to 3.15% as compared to a range of 4.00% to 6.00% interest rate for insured bonds sold on the market. The City of Houston notified BAWA of a rate increase effective April 1, 2008 for untreated water purchased from the City of Houston. The rate increased 1.8% from $0.4238 to $0.4314 per 1,000 gallons. The previous rate increase was in 2007. Also, a 2% increase in the cost of raw water from the City of Houston is anticipated effective April 1, 2009 and is included in the adopted budget. Revenue estimates for water sales in the adopted budget are based upon sales in a typical year. A rate increase was projected in the 2001 BAWA Rate Study for fiscal year 2005 for implementation of the capital improvement program (CIP), which anticipated construction of the Phase II regulatory /disinfection improvements. The second water supply line was not included in the CIP at that time. Since TWDB's loan program reimburses BAWA as funds are expended, the full debt payments will not occur until the project is complete. As of June 30, 2008, $8,840,000 of the total $13,290,000 has been funded. 'Funding requests are submitted to TWDB as invoices are received from the contractor. 3 The adopted budget includes a $0.09 per 1,000 gallon rate increase (approximately 6 %) for BAWA's customers to adjust for the untreated water rate increase and debt associated with the construction of the new water supply line. Rates will be adjusted in future budgets to reflect funding needs based on actual operational needs including debt service requirements. This will allow the rate increase related to debt to coincide closely with the actual construction. It will also provide for time contingencies that may be required due to the complexity of the project that may extend the construction time. The City of Baytown Water and Sewer Fund pays for the cost of the City to tie -in to the new BAWA supply line to pay for their portion of the project. The City's portion of the project costs are estimated to total $1,000,000. A continuing transfer from the City's water and sewer fund is included for that portion of the debt payment. In January of 2006, the EPA approved the Long Term 2 Enhanced Surface Water Treatment (LT2) Rule and the Stage 2 Disinfection Byproducts (DBP) Rules. With respect to the LT2 rule, systems that serve a population of less than 100,000 began the monitoring schedule in January 2007. The schedule is as follows: Submit Sampling Plan January 1, 2007 Begin source water monitoring April 1, 2007 Report bin classification October 1, 2009 Comply with additional treatment requirements (Ozone) October 1, 2012 The data collected during the 2 year monitoring period will determine if Ozone treatment should be implemented at the BAWA surface water treatment plant. The Stage 2 DBP rule pertains to the City of Baytown distribution system only. BAWA has received the Small System waiver and does not have to monitor the by- products listed in the rule. We have completed the first two steps in this process. The current and planned major improvements at BAWA were designed to provide the foundation for growth in sales and continued reliable service of the highest quality water for our customers. 1 look forward to reviewing this document with you. Sind ely, C.� Garry Brumba�rlkr GeneraLManager 4 MAJOR BUDGET ISSUES Fiscal Year 200 8-09 BAYTOWN AREA WATER AUTHORITY This fund accounts for the activities 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 88% 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 raw water supply to the plant nor interruptions to service to its customers. REVENUES The 2008 -09 adopted budget estimates sales of $6,804,472 for 12.0 million gallons per day (MGD) based upon an average rainfall year. Fluctuations to average rainfall can significantly impact actual sales. A $0.09 rate increase is in the 2008 -09 adopted budget. The current rate structure of $1.46 per 1,000 gallons for the City of Baytown and 1.49 per 1,000 gallons for customers outside the city will increase to $1.55 and $1.58 respectively. This will cover the increased cost of operations, including debt service and the purchase of raw water. This increase in rates is expected to generate $394,200 in additional revenue. EXPENDITURES Total operating expenditures for the adopted 2008 -09 budget are $4,722,800, a decrease of $76,050 from the 2007 -08 budget. The depreciation expense increased to recognize one full year of depreciation on new improvements. The adopted 2008 -09 budget includes a transfer to General Fund for an indirect cost allocation, which is to reimburse the City for administrative services such as Human Resources, Fiscal Operations, Legal and Information Technology Services. Highlights of major operating changes were as follows: • Increase in personnel services $ 4,154 • Decrease in supplies (Primarily raw water rate increase) (108,326) • Decrease in maintenance (12,200) • Increase in services 40,322 Raw Water Supply Cost — BAWA purchases raw water from the City of Houston. The raw water supply contract with the City of Houston is in effect through the year 2040 and sets the maximum amount of raw water to be delivered to the BAWA plant at 15.8 MGD without penalties. BAWA received notice of a 1.8% rate increase from $0.4238 to $0.4314 effective April 1, 2008. An additional increase of 2% is anticipated in April 2008. The surcharge for water purchased over the 15.8 MGD is nominal at this time. Debt Service — The debt service requirement for existing debt for the adopted 2008 -09 budget is $2,163,526. MAJOR BUDGET ISSUES Fiscal Year 2008 -09 CAPITAL IMPROVEMENT PROGRAM The Capital Improvement Program for BAWA is funded primarily from bonds. The adopted 2008 -09 budget includes funding from retained earnings designated for capital improvements for the second water supply line project. Utilizing non - operating funds in the CIP program will reduce the amount of debt issued in the future. Phase II of BAWA's plant improvement is on hold pending the Texas Commission on Environmental Quality (TCEQ) study to develop new recommendations pertaining to disinfection programs (Ozone). Phase II was originally estimated at $6,000,000. Final costs will be developed after TCEQ issues final regulations. Implementation will be planned in the fiscal year following the issuance of final regulations that will enable the BAWA Board to review implementation plans during the annual budget process. There is currently one line supplying water to BAWA's major customer, the City of Baytown. The BAWA board approved a contract for the design for the second line in 2004. The design is complete and has been approved by TWDB and the BAWA Board and the City Council awarded the contract in the Spring of 2006. The project is partially funded from non - recurring revenues and CIP funds to reduce the amount of debt that is issued. TWDB debt has been issued for construction. The total estimated cost is $10.5 million for the BAWA line with $1,000,000 funded by the City of Baytown for extending their lines to connect with the new supply line. This project is nearing completion. WORKING CAPITAL In order to maintain fiscal stability, governmental entities maintain a working capital balance to meet daily liquidity needs. Appropriate levels of working capital vary from entity to entity based on the relative impact of particular circumstances or financial conditions. The goal for working capital is 60 to 90 days. Working capital is defined as current assets (e.g., cash, investments and accounts receivable) less current liabilities (e.g., accounts payable). The working capital in the adopted budget is estimated to be 64 days as of September 2009. Working capital in excess of the targeted goal provides contingency funding for current projects and unforeseen expenses. 6 BAYTOWN AREA WATER AUTHORITY FUND 510 BUDGET SUMMARY BY FUND Actual Budget Estimated Adopted 2006 -07 2007 -08 2007 -08 2008 -09 Revenues Sale of Water - Baytown $ 4,644,450 $ 5,784,448 $ 5,390,089 $ 5,989,595 Sale of Water - Other 639,768 913,445 770,565 814,877 Interest Revenue 64,773 68,000 21,800 24,100 Mineral Royalties 13,747 15,000 13,300 13,000 Miscellaneous 22,776 2,400 600 - Transfer From Water & Sewer Fund 68,000 68,000 68,000 68,000 Total Revenues 5,453,514 6,851,293 6,264,354 6,909,572 Expenditures Personnel Services 952,900 980,485 970,273 984,639 Supplies 2,235,948 2,712,961 2,262,500 2,604,635 Maintenance 185,809 257,700 262,200 245,500 Services 687,183 847,704 844,699 888,026 Total Operating 4,061,840 4,798,850 4,339,672 4,722,800 Capital Outlay - 13,000 13,078 - Transfers Out - Debt Service 1,950,060 2,172,486 2,005,000 2,168,527 Transfers Out - General Fund 50,000 50,000 50,000 50,000 Contingency - 40,000 20,000 40,000 Total Expenditures 6,061,900 7,074,336 6,427,750 6,981,327 Excess (Deficit) Revenues Over Expenditures (608,386) (223,043) (163,396) (71,755) Working Capital - Beginning 2,062,261 1,550,008 1,453,875 1,290,479 Debt Service Reserve - - - - Working Capital - Ending $ 1,453,875 $1,326,965 $1,290,479 $1,218,724 No. of Working Capital Days 88 68 73 64 7 BAWA - CAPITAL IMPROVEMENT PROGRAM FUND 518 BUDGET SUMMARY BY FUND Actual Carried - forward Adopted Adjustments Adj Budget Estimated Carried - forward Adopted 2006 -07 2006 -07 2007 -08 2007 -08 2007 -08 2007 -08 2007 -08 2008 -09 revenues Transfer From BAWA $ - $ - $ - $ - $ - $ - $ - $ - Interest Revenue 100,647 - 75,000 - 75,000 25,000 - 25,000 Total Revenues 100,647 - 75,000 - 75,000 25,000 - 25,000 Expenditures BAWA Admin Bldg - A/C Repairs 25,305 134,695 - - 134,695 134,695 - BAWA Second Supply Line 279,229 252,009 - 5,700 257,709 257,709 - Highlands Tie-in Meter 12,738 - - - - - BAWA Raw Waterline - 76,500 - 76,500 76,500 - Pump Replacement - - 22,000 22,000 22,000 - Thompson Rd Utility Relocation - - - - - 500,000 Capital Assets - - - - - 23,000 New Capital Project Initiatives - 1,292,647 75,000 (27,700) 1,339,947 - 766,947 25,000 Total Expenditures 317,272 1,755,851 75,000 - 1,830,851 490,904 766,947 548,000 Exgess (Deficit) Revenues Over Expenditures Retained Earnings - Beginning Retained Earnings - Ending (216,625) (1,755,851) - - (1,755,851) (465,904) (766,947) (523,000) 1,972,476 1,755,851 - - 1,755,851 1,755,851 1,289,947 523,000 $ 1,755,851 $ - $ - $ - $ - $1,289,947 $ 523,000 $ - CITY OF BAYTOWN PROGRAM SUMMARY 3070 BAYTOWN AREA WATER AUTHORITY BAWA Program Description Operate and maintain a 26 MGD design capacity surface water treatment facility with a projected flow of 12.0 MGD in fiscal year 2008 -2009 and a certified bacteriological laboratory, which currently serves 8 customers with the City of Baytown using 88% of production. Follow and comply with the Texas Commission on Environmental Quality (TCEQ) Rules and Regulations for Public Water Supplies adopted 1992, National Primary Drinking Water Regulations, Safe Drinking Water Act, Surface Water Treatment Rule, and the Criteria for Certified Bacteriological Laboratories. Provide BAWA's customers with high quality, safe drinking water and consistent water pressure for fire protection. Major Goals • Maintain water quality necessary to be classified as "Meeting Optimum Corrosion Control" by TCEQ. • Maintain "Superior Public Water System" status. Workload Measures Maintain Optimization Standards as classified by TCEQ's Texas Optimization Program. Operate the bacteriological laboratory in a manner that exceeds the requirements as set fourth by Texas Department of Health. Develop and maintain a staff of highly trained water professionals to better serve customers. Major Objectives • Produce 12.0 MGD of water. • Maintain finished water turbidity consistently less than 0.1 NTU. • Provide QA/QC and mathematical training for personnel. Actual Budget Estimated Projected 2006 -07 2007 -08 2007 -08 2008 -09 1. Customer Connections 8 8 8 8 Average MGD of water produced 3. Customer Service calls Performance Measures 10.35 12.5 11.5 12.0 3 10 15 12 1. Days without interruption of service 365 366 366 365 2. Days finished water <0.1 NTU 365 366 366 365 3. Customer Service Calls Investigated 3 10 15 12 4. Maintain Distribution Cl2 Residual <4.0 365 366 366 365 mgl CITY OF BAYTOWN SERVICE LEVEL BUDGET 3070 BAYTOWN AREA WATER AUTHORITY Actual Budget Estimated Adopted Acct# Acct Description 2006 -07 2007 -08 2007 -08 2008 -09 7100 Personnel Services 71031 Contract Personnel Services $ 952,900 $ 980,485 $ 970,273 $ 984,639 Total Personnel Services 952,900 980,485 970,273 984,639 7200 Supplies 72001 Office 3,922 4,000 3,500 4,000 72002 Postage 399 2,940 2,800 1,650 72007 Wearing Apparel 4,070 5,000 4,000 5,000 72016 Motor Vehicle 7,993 12,000 12,000 12,000 72021 Minor Tools 1,119 1,800 1,800 1,800 72026 Cleaning & Janitorial 1,696 2,000 1,500 2,000 72028 Swimming Pool Supplies (50) - - - 72031 Chemical 472,224 603,000 525,000 558,000 72032 Medical 392 600 600 1,000 72041 Educational 575 1,300 1,300 1,300 72051 Untreated Water 1,725,825 2,046,571 1,680,000 1,987,885 72055 Laboratory Supplies 17,783 33,750 30,000 30,000 Total Supplies 2,235,948 2,712,961 2,262,500 2,604,635 7300 Maintenance 73011 Buildings 1,978 2,500 2,000 2,500 73021 Filtration Plants 10,274 55,000 50,000 10,000 73025 Streets Sidewalks & Curbs - 500 500 8,000 73027 Heating & Cooling System 6,816 6,500 5,000 2,000 73028 Electrical Maintenance 68,345 79,000 80,000 84,000 73041 Furniture & Fixtures 522 1,000 1,200 2,500 73042 Machinery & Equipment 96,447 106,200 120,000 130,000 73043 Motor Vehicles 937 6,500 3,200 6,000 73045 Radio & Testing Equipment 208 500 300 500 73048 Signal Systems 282 - - - Total Maintenance 185,809 257,700 262,200 245,500 7400 Services 74001 Communication 3,609 3,900 3,900 4,300 74002 Electric Service 591,146 709,500 709,500 709,500 74011 Equipment Rental 4,912 12,400 6,000 10,000 74021 Special Services 42,323 63,820 71,950 108,500 74022 Audits 4,843 10,221 13,647 13,149 74036 Advertising 240 700 550 700 74041 Travel & Reimbursables 3,580 4,000 4,000 6,100 74042 Education & Training 8,541 14,220 9,000 8,200 74071 Association Dues 575 800 800 800 74210 General Liability Insurance 4,947 4,724 3,387 3,489 74220 Errors & Omissions 6,695 6,730 4,781 4,961 74240 Auto Liability 698 767 514 581 74242 Auto Catastrophic 27 27 26 27 74271 Mobile Equipment 352 370 347 365 74272 Real & Personal Property 14,695 15,430 16,240 17,052 74280 Bonds - 95 57 10 74281 Employee Fraud - - - 292 10 CITY OF BAYTOWN SERVICE LEVEL BUDGET 3070 BAYTOWN AREA WATER AUTHORITY Actual Budget Acct# Acct Description 2006 -07 2007 -08 Total Services 687,183 847,704 Total Operating 8000 Capital Outlay 84042 Machinery & Equipment 84043 Motor Vehicles Total Capital Outlay 9000 Other Financing Uses Estimated Adopted 2007 -08 2008 -09 844,699 888,02 4,061,840 4,798,850 4,339,672 4,722,800 13,000 13,078 - 13,000 13,078 - 92101 To General Fund 50,000 50,000 50,000 50,000 91511 To BAWA Debt Service 1,950,060 2,172,486 2,005,000 2,168,527 91518 To BAWA Capital Improv - - - - Total Other Financing Uses 2,000,060 2,222,486 2,055,000 2,218,527 9900 Contingencies 99001 Contingencies - 40,000 20,000 40,000 Total Contingencies - 40,000 20,000 40,000 TOTAL DEPARTMENT $6,061,900 $7,074,336 $6,427,750 $6,981,327 11 BAYTOWN AREA WATER AUTHORITY REVENUE BONDS LONG TERM DEBT AMORTIZATION SCHEDULES Principal Requirements Principal Revenue Amount of Outstanding Fiscal Year 2007 -08 Outstanding Bonds Issue Oct. 1, 2008 Principal Interest Total Sept. 30, 2008 Series. 1999 $ 9.095,000 $ 1,745,000 $ 550,000 $ 91,710 $ 641,710 $ 1,195,000 Series, 2002 3,800,000 2,980,000 190,000 151,449 341,449 2,790,000 Series, 2006 13,290,000 12,165,000 540,000 337,355 877,355 11,625,000 Series, 2007 6,505,000 6,465,000 40,000 263,013 303,013 6,465,000 Total $ 23,355,000 $ 1,320,000 $ 843,526 $ 2,163,526 $ 22,075,000 Combined BAWA Debt, All Series 2.500 Debt Requirements to Maturity c N 2.000 Fiscal Principal Total Total Year 5101 Interest Requirement E o Q :E 0.500 2009 $ 1,320,000 $ 843,526 $ 2,163,526 2010 1,375,000 787,706 2,162, 706 2011 1,425,000 733,281 2,158,281 2012 1,490,000 676,126 2,166,126 2013 1,535,000 624,301 2,159,301 2014 1,590,000 569,911 2,159,911 2015 1,645,000 512,621 2,157,621 2016 1,710,000 452,691 2,162,691 2017 1,765,000 389,961 2,154,961 2018 1,830,000 324,799 2,154,799 2019 1,900,000 254,346 2,154,346 2020 1,030,000 180,658 1,210,658 2021 735,000 143,588 878,588 2022 755,000 122,273 877,273 2023 775,000 100,000 875,000 2024 800,000 76,750 876,750 2025 825,000 52,350 877,350 2026 850,000 26,775 876,775 2.500 c N 2.000 1.500 1.000 E o Q :E 0.500 0.000 - -+ - - Total $23,355,000 $ 6,871,664 $ 30,226,664 Combined BAWA Debt, All Series Debt Requirement to Maturity Interest Up. rincipal 20 do do do do do do ryo do do �o do Doti Doti "p, ,LO`l ,LO`i' ti0`l `LOS Fiscal Year &a BAYTOWN AREA WATER AUTHORITY REVENUE BONDS DETAIL DEBT AMORTIZATION SCHEDULES Fiscal Interest Principal Interest Interest Annual Principal Total Year Rate Due 5101/09 Due 5/01/09 Due 11101/08 Requirement Outstanding Outstanding Revenue Bond, Series 1999 Date of Issue - November 1, 1999 Term .20 Years $ 2,612,145 2007 7.000% $ 245,000 $ 63,705 $ - $ 308,705 $ 2,010,000 2,303,440 7nn.Q 7 nnno/ 9R.S_nnn 55.130 55.130 375.260 1.745,000 1,928,180 2011 5.100% 610,000 15,555 15,555 641,110 - - $ 2,255,000 $ 210,425 $ 146,720 $ 2,612,145 Revenue Bond, Series 2002 5.500% Date of Issue - January 10, 2002 75,724 Term -19 Years 341,449 2,790,000 3,704,388 2010 5.500% 195,000 70,499 $ 6,040,949 2002 2,595,000 $ - $ 81,895 $ - $ 81,895 $ 3,800,000 5,959,054 2003 2,390,000 - 98,274 98,274 196,549 3,800,000 5,762,505 2004 5.500% 150,000 98,274 98,274 346,549 3,650,000 5,415,956 2005 5.500% 155,000 94,149 94,149 343,299 3,495,000 5,072,658 2006 5.500% 165,000 89,887 89,887 344,774 3,330,000 4,727,884 2007 5.500% 170,000 85,349 85,349 340,699 3,160,000 4,387,185 2008 5500% 180 000 80,674 80,674 341,349 2,980,000 4,045,836 2009 5.500% 190,000 75,724 75,724 341,449 2,790,000 3,704,388 2010 5.500% 195,000 70,499 70,499 335,999 2,595,000 3,368,389 2011 5.350% 205,000 65,137 65,137 335,274 2,390,000 3,033,115 2012 4.700% 215,000 59,653 59,653 334,306 2,175,000 2,698,809 2013 4.800% 230,000 54,601 54,601 339,201 1,945,000 2,359,608 2014 4.900% 240,000 49,081 49,081 338,161 1,705,000 2,021,446 2015 5.000% 250,000 43,201 43,201 336,401 1,455,000 1,685,045 2016 5.000% 265,000 36,951 36,951 338,901 1,190,000 1,346,144 2017 5.000% 275,000 30,326 30,326 335,651 915,000 1,010,493 2018 5.100% 290,000 23,451 23,451 336,901 625,000 673,591 2019 5.125% 305,000 16,056 16,056 337,111 320,000 336,480 2020 5.150% 320,000 8,240 8,240 336,480 - - $ 3,800,000 $ 1,161,422 $ 1,079,527 $ 6,040,949 13 BAYTOWN AREA WATER AUTHORITY REVENUE BONDS DETAIL DEBT AMORTIZATION SCHEDULES Fiscal Interest Principal Interest Interest Annual Principal Total Year Rate Due 5/01109 Due 5/01109 Due 11101/08 Requirement Outstanding Outstanding Revenue Bond, Series 2006 Date of Issue - June 14, 2006 Term - 20 Years -13 Years $17,537,835 2007 2.250% $ 595,000 $ 283,082 $ - $ 878,082 $12,695,000 16,659,753 2008 2.250% 530,000 174,640 174,640 879,280 12,165,000 15,780,473 2009 2.300% 540,000 168,678 168,678 877,355 11,625,000 14,903,118 2010 2.300% 550,000 162,468 162,468 874,935 11,075,000 14,028,183 2011 2.350% 565,000 156,143 156,143 877,285 10,510,000 13,150,898 2012 2.400% 580,000 149,504 149,504 879,008 9,930,000 12,271,890 2013 2.500% 590,000 142,544 142,544 875,088 9,340,000 11,396,803 2014 2.600% 605,000 135,169 135,169 875,338 8,735,000 10,521,465 2015 2.650% 620,000 127,304 127,304 874,608 8,115,000 9,646,858 2016 2.700% 640,000 119,089 119,089 878,178 7,475,000 8,768,680 2017 2.750% 655,000 110,449 110,449 875,898 6,820,000 7,892,783 2018 2.800% 675,000 101,443 101,443 877,885 6,145,000 7,014,898 2019 2.850% 695,000 91,993 91,993 878,985 5,450,000 6,135,913 2020 2.900% 710,000 82,089 82,089 874,178 4,740,000 5,261,735 2021 2.900% 735,000 71,794 71,794 878,588 4,005,000 4,383,148 2022 2.950% 755,000 61,136 61,136 877,273 3,250,000 3,505,875 2023 3.000% 775,000 50,000 50,000 875,000 2,475,000 2,630,875 2024 3.050% 800,000 38,375 38,375 876,750 1,675,000 1,754,125 2025 3.100% 825,000 26,175 26,175 877,350 850,000 876,775 2026 3.150% 850,000 13,388 13,388 876,775 - - $13,290,000 $ 2,265,458 $ 1,982,376 $ 17,537,835 Rev. Refunding Bond, Series 2007 Date of Issue - February 1, 2007 Term -13 Years $ 8,842,941 2007 $ - $ 66,153 $ - $ 66,153 $ 6,505,000 8,776,788 2008 4.000% 40,000 132,306 132,306 304,613 6,465,000 8,472,175 2009 4.000% 40,000 131,506 131,506 303,013 6,425,000 8,169,163 2010 4.000% 45,000 130,706 130,706 306,413 6,380,000 7,862,750 2011 4.000% 45,000 129,806 129,806 304,613 6,335,000 7,558,138 2012 4.000% 695,000 128,906 128,906 952,813 5,640,000 6,605,325 2013 4.000% 715,000 115,006 115,006 945,013 4,925,000 5,660,313 2014 4.000% 745,000 100,706 100,706 946,413 4,180,000 4,713,900 2015 4.000% 775,000 85,806 85,806 946,613 3,405,000 3,767,288 2016 4.000% 805,000 70,306 70,306 945,613 2,600,000 2,821,675 2017 4.000% 835,000 54,206 54,206 943,413 1,765,000 1,878,263 2018 4.250% 865,000 37,506 37,506 940,013 900,000 938,250 2019 4.250% 900,000 19,125 19,125 938,250 - - $ 6,505,000 $ 1,202,047 $ 1,135,894 $ 8,842,941 14 City of Houston Untreated Water Rates Year Rate 04/81 .22142 Rate 02/83 .24157 1981 10/86 .25123 10/87 .28022 01/88 .26591 FIRST 150 MGD /PER 1,000, .26113 NEXT 150 MGD 08/88 .28426 FIRST 300 MGD /PER 1,000, .27915 NEXT 300 MGD 07189 .29344 FIRST 300 MGD /PER 1,000, .28817 NEXT 300 MGD 08/90 .31178 FIRST 300 MGD /PER 1,000, .30618 NEXT 300 MGD 02/92 .31820 FIRST 300 MGD /PER 1,000, .31249 NEXT 300 MGD 10/93 .32907 FIRST 300 MGD /PER 1,000 .32316 NEXT 300 MGD 10/94 .37192 (GRACE UP TO 13.1 MGD. ANYTHING OVER 11.9 IF WE GO OVER, THEN 5% ADDED TO 06/04 .385 (GRACE UP TO 13.1 MGD. IF WE GO OVER, THEN 5% ADDED TO ANYTHING OVER 11.9 04/05 .398 (GRACE UP TO 17.38 MGD. IF WE GO OVER, THEN 5% ADDED TO ANYTHING OVER 15.8 04/06 .4123 (GRACE UP TO 17.38 MGD. ANYTHING OVER 15.8 IF WE GO OVER, THEN 5% ADDED TO 04/07 .4238 (GRACE UP TO 17.38 MGD. ANYTHING OVER 15.8 IF WE GO OVER, THEN 5% ADDED TO 04108 .4314 (GRACE UP TO 17.38 MGD. ANYTHING OVER 15.8 IF WE GO OVER, THEN 5% ADDED TO Baytown Area Water Authority Treated Water Rates 15 Increase Year Rate Amount Comments 1981 $0.97 COB 1985-1987 $0.97 COB, $1.00 Other Result of rising operating cost. 1988-1992 $1.07 COB, $1.10 Other $0.10 Raw water rates up 25% Result of increase in raw water 1993-1998 $1.18 COB, $1.21 Other $0.11 rates. 1999-2006 $1.26 COB, $1.29 Other $0.08 Funding for plant expansion debt Funding for new water line debt and City of Houston rate 2007 $1.39 COB, $1.42 Other $0.13 increase. Funding for new water line debt and City of Houston rate 2008 $1.46 COB, $1.49 Other $0.07 increase. Funding for new water line debt, other operating increases and 2009 $1.55 COB, $1.58 Other $0.09 City of Houston rate increase. 15 CITY OF HOUSTON Bill White Public Works and Engineering Department IMPORTANT NOTICE Mayor Michael S. Marcotte, P.E., DEE Director P.O. Box 4863 Houston, Texas 77210.4863 www.houstontx.gov NOTIFICATION OF WATER RATE ADJUSTMENT On April 1. 2008 water and sewer rates will be adjusted upward by 1.8 %. Each year rates are adjusted by the amount of the U.S. Department of Labor's Consumer Price Index (CPI) for the prior year. This is the rate of inflation as measured in the Houston - Galveston- Brazoria tri- county area. The new rates become effective on April 1 st and the billing you receive in May will reflect the 1.8% rate adjustment. NEW RATES AND CHARGES Classification Rate Contract Treated Water P x $1.793 plus (P -M) x $.582 Untreated Water Rates where there is no contract First 10,000,000 gallons $1.079 per 1,000 gallons Next 10,000,000 gallons $0.970 per 1,000 gallons Next 30,000,400 gallons $0.915 per 1,000 gallons Next 100,000,000 gallons $0.860 per 1.000 gallons Excess of 150,000,000 gallons $0.832 Per 1,000 gallons Untreated Water Rates under written contracts $0.4314 per 1,000 gallons P = Total water delivery during the month in thousand gallons, except if the minimum monthly specified in the customer's contract is greater than P, P shall equal M. M = Minimum monthly amount of water specified in the customer's contract expressed in units of one thousand gallons, For further information, please: Refer to the Rates and Prices or the Billing and Payment section of your contract Visit: httD: / /www.houstontx.-gov /codes/ (Sections 47 -61 and 47 -84 et seq.) Please contact Maria Carrillo at Utility Customer Service at (713) 371 -1400 and choose Option 6 if you have specific questions about your bill. 16