Ordinance No. 9,224ORDINANCE NO. 9224
® AN ORDINANCE APPROVING THE BUDGET FOR THE BAYTOWN AREA
WATER AUTHORITY (BAWA) FOR THE FISCAL YEAR BEGINNING
OCTOBER 1, 2001, AND ENDING SEPTEMBER 30,2002; 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, 2001, and ending
September 30, 2002; 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 full 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 (BAWA) for the fiscal year beginning October 1, 2001,
and ending September 30, 2002, in the amount of SIX MILLION SEVEN HUNDRED FIFTY -
EIGHT THOUSAND FOUR HUNDRED EIGHTEEN AND NO /100 DOLLARS ($6,758,418.00).
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 13th day of September, 2001.
/. C
PETE C. ALFARO, Mayor
ATTEST:
S iTTI H, City Clerk
APPROVND AS TO FORM:
ACIO RAMIREZ, SU City Attorney
d A\MyDocuments\ Council\ 00 -01 \September\AdoptBAWABudget01 -02
� Baytown Area Water Authority
(BAWA)
ANNUAL PROGRAM OF SERVICES
2001 -02
PROPOSED BUDGET
Submitted To Baytown Area Water
Authority Board
July 31, 2001
Monte Mercer
• Fred Pack
Donna Sams
Q=IT A
General Manager
Plant Manager
Director of Finance
0 BAYTOWN AREA WATER
AUTHORITY
BOARD OF DIRECTORS
ROBERT L. GILLETTE, President
DAN MUNDINGER, Vice President
PETER R. BUENZ, Secretary
KNOX BEAVERS
SAM T. SCHULZE
BAYTOWN AREA WATER AUTHORITY
.MAJOR BUDGET ISSUES
FISCAL YEAR 2001 -02
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. The City comprises approximately 88% of BAWA's annual
sales. BAWA is a separate legal entity; however, it is considered a component unit of the City.
REVENUES
The 2001 -02 budget projects sales of $5,579,956 for 12.1 million gallons per day (MGD) based
upon average rainfall years. Fluctuations to average rainfall can significantly impact actual sales.
No increases are projected to BAWA's current rate structure of $1.26 per 1,000 gallons for the
City of Baytown and $1.29 per 1,000 gallons for customers outside the city. Since the inception
of the BAWA plant in April 1981, there have been three rate increases in 1988, 1993 and 1999.
The 1999 increase provided funding for the issuance of debt for plant expansion.
EXPENDITURES
Total proposed operating expenditures for the 2001 -02 budget are $6,136,345, an increase of
$577,707 or 10.4 %. These expenses exclude the CIP transfer discussed in the Capital
Improvement Program section. Highlights of major increases include:
• An increase of $55,235 in electrical costs.
• Operational increases of $67,545 in personnel services that includes increases in health care
costs and market and merit adjustments.
• Projected increase of $71,400 for increases in water volume and related chemical
expenditures.
• Replacement of a 1989 truck and a 1983 tractor for $45,000.
• Lagoon cleaning and tank inspection of $50,000.
• The debt service payment had a net increase of $295,739 which primarily included the first
year payment for bonds that will be issued in 2002 totaling $4,403,000 (See Capital
Improvement Program for additional information).
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 2020 and sets the
maximum amount of raw water to be delivered to the BAWA plant at 11.9 MGD without
penalties. BAWA anticipates no rate increase from the City of Houston for next year; therefore,
there will be no pass through increase in the cost of raw water for the 2002 fiscal year. The
surcharge for water purchased over the 11.9 MGD is nominal at this time.
Debt Service — The current debt service requirement for 2001 -02 is $2,329,258. This includes
an increase of $377,927 for new debt issuance and $1,951,331 for existing debt. Two of the five
bond issues outstanding will be paid off by fiscal year 2003. The pay off of these bonds provides
is debt capacity for future bond issues.
1
® CAPITAL IMPROVEMENT PROGRAM
The BAWA Surface Water Treatment Plant expansion should be completed by the fall of 2001
and will increase the current rating of 13 MGD to an estimated 19.5 MGD. The expanded plant
will be able to produce approximately 26 MGD on a short-term basis, if necessary. The
additional plant capacity will be available for the. first quarter of the year 2002.
C]
A comprehensive rate study was conducted in 2001 to address the potential impact the new
customers would have on the existing rates and plant capacity. BAWA has experienced no
shortages of raw water supply to the plant or interruptions to service to its customers. As part of
the study, BAWA plans to upgrade plant capacity to 26 MGD. Revenue bonds totaling
$4,403,000 will be issued in 2002 for this project. There is currently one line supplying water to
BAWA's major customer, the City of Baytown. A second line is planned in 2003 at an estimated
cost of $3,500,000.
The 2002 budget includes a transfer to the BAWA Capital Improvement Program (CIP) of
$622,073, which represents non - operating revenues received from a mineral royalty. Utilizing
non - operating funds in the CIP program will reduce the amount of debt issued in the future.
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 45 to 60 days. Working capital is defined as current assets (e.g. cash, investments,
accounts receivable) less current liabilities (e.g. accounts payable). Projected working capital is
estimated to be 68 days as of September 2002.
2
C
CITY OF BAYTOWN
BAYTOWN AREA WATER AUTHORITY FUND 510
BUDGET SUMMARY BY FUND
I Actual Budget Estimated Base Proposed I
1999 -00 2000 -01 2000 -01 2001 -02 2001 -02
Revenues
650,795
698,119
697,133
765,664
765,664
Sale of Water - Baytown $
4,866,249 $
4,856,544 $
4,899,825
$ 4,927,829 $
4,927,829
Sale of Water - Other
646,075
635,648
647,419
652,127
652,127
Interest Revenue
91,816
-
66,968
40,000
40,000
Mineral Royalties
273,341
127,604
499,988
250,000
250,000
Total Revenues
5,877,481
5,619,796
6,114,200
5,869,956
5,869,956
Expenditures
Personal Services
650,795
698,119
697,133
765,664
765,664
Supplies
2,049,198
2,191,200
2,232,762
2,258,500
2,258,500
Maintenance
124,969
148,800
143,300
152,200
202,200
Services
428,047
447,000
479,352
495,723
495,723
Total Operating
3,253,009
3,485,119
3,552,547
3,672,087
3,722,087
Capital Outlay - - - 45,000 45,000
Transfers Out - Debt 2,033,874 2,033,519 2,031,019 1,951,331 2,329,258
Transfers Out - Capital Improvement - - - - 622,073
Contingency - 40,000 - 40,000 40,000
Total Expenditures 5,286,883 5,558,638 5,583,566 5,708,418 6,758,418
Excess (Deficit) Revenues
Over Expenditures
Working Capital -Beginning
Working Capital - Ending
No. of Working Capital Days
590,598 61,158 530,634 161,538 (888,462)
1,033,075 1,623,673 1,623,673 2,154,307 2,154,307
$ 1,623,673 $ 1,684,831 . $ 2,154,307 $ 2,315,845 $ 1,265,845
112 111
141 148 68
CITY OF BAYTOWN
BAYTOWN AREA WATER AUTHORITY FUND 510
OPERATING RESULTS
Actual Budget Estimated Base Proposed
1999 -00 2000 -01 2000 -01 2001 -02 2001 -02
Operating Revenues
Sale of Water - Baytown $ 4,866,249 $ 4,856,544 $ 4,899,825 $ 4,927,829 $ 4;927,829
Sale of Water - Other 646,075 635,648 647,419 652,127 652,127
Total Revenues 5,512,324 5,492,192 5,547,244 5,579,956 5,579,956
Operating Expenses
Personal Services
650,795
698,119
697,133
765,664
765,664
Raw Water Purchases
1,591,274
1,610,000
1,613,000
1,625,000
1,625,000
Supplies
457,924
581,200
619,762
633,500
633,500
Maintenance
124,969
148,800
143,300
152,200
202,200
Services
428,047
447,000
479,352
535,723
535,723
Depreciation
418,230
443,635
341,775
481,905
481,905
Total Expenditures
3,671,239
3,928,754
3,894,322
4,193,992
4,243,992
Operating Income (Loss) 1,841,085 1,563,438 1,652,922 1,385,964 1,335,964
Non - operating
Interest Revenue and Other 365,157 127,604 566,956 290,000 290,000
Interest Expenses and Other (683,874) (823,519) (781,019) (701,331) (957,078)
Transfers out - Capital Improvement - - - (622,073)
Total Non - operating Expenses (318,717) (695,915) (214,063) (411,331) (1,289,151)
Net Income (Loss) $ 1,522,368 $ 867,523 $ 1,438,859 $ 974,633 $ 46,813
onciliation of Net Income (Loss) to Revenues Over (Under) Expenses:
Income (Loss) $ 1,522,368 $ 867,523 $
Principal Debt Retirement (1,350,000) (1,250,000)
Capital Outlay - -
Depreciation 418,230 443,635
enues Over (Under) Expenditures $ 590,598 $ 61,158 $
4
1,438,859
$ 974,633 $
(1,250,000)
(1,250,000)
-
(45,000)
341,775
481,905
530,634
$ 161,538 $
46,813
(1,372,180)
481
v
CITY OF BAYTOWN
SERVICE LEVEL BUDGET
3070 TOWN AREA WATER AUTHORITY
Actual Budget Estimated Base Proposed
Acct# Acct Description 1999 -00 2000 -01 2000 -01 2001 -02 2001 -02
7100
Personal Services
71031
Contract Personal Services $
650,795 $
698,119 $
697,133 $
765,664 $
765,664
Total Personal Services
650,795
698,119
697,133
765,664
765,664
7200
Supplies
72001
Office
3,760
2,500
2,500
2,500
2,500
72002
Postage
444
600
500
500
500
72007
Wearing Apparel
5,179
7,000
6,000
6,000
6,000
72016
Motor Vehicle
4,468
3,500
4,000
4,500
4,500
72021
Minor Tools
847
2,800
2,800
2,800
2,800
72026
Cleaning & Janitorial
1,544
2,000
1,500
2,000
2,000
72031
Chemical
418,459
516,000
522,000
532,800
532,800
72032
.Medical
574
600
600
600
600
72041
Educational
761
1,200
1,200
1,200
1,200
72051
Untreated Water
1,591,274
1,625,000
1,665,662
1,679,600
1,679,600
72055
Laboratory Supplies
21,888
30,000
26,000
26,000
26,000
Total Supplies
2,049,198
2,191,200
2,232,762
2,258,500
2,258,500
7300
Maintenance
73011
Buildings .
2,608
3,000
3,000
3,000
3,000
73021
Filtration Plants
3,781
8,000
5,000
8,000
58,000
73022
Sanitary Sewers
-
600
600
600
600
73025
Streets Sidewalks & Curbs
85
700
700
700
700
73027
Heating & Cooling System
2,915
4,000
4,000
4,400
4,400
73028
Electrical Maintenance
16,394
50,000
30,000
50,000
50,000
73041
Furniture & Fixtures
1,451
1,000
2,000
1,000
1,000
73042
Machinery & Equipment
91,734
75,000
90,000
75,000
75,000
73043
Motor Vehicles
6,001
6,000
8,000
9,000
9,000
73045
Radio & Testing Equipment
-
500
-
500
500
Total Maintenance
124,969
148,800
143,300
152,200
202,200
7400
Services
74001
Communication
9,700
10,000
10,000
10,000
10,000
74002
Electric Service
359,913
355,000
406,845
410,235
410,235
74011
Hire Of Equipment
5,995
8,000
5,000
8,000
8,000
74012
Insurance
20,412
24,000
18,807
21,358
21,358
74021
Special Services
6,899
18,500
7,000
12,500
12,500
74022
Audits
8,010
9,000
9,000
10,800
10,800
74036
Advertising
792
600
800
800
800
74041
Travel & Reimbursables
3,090
4,000
4,000
4,000
4,000
74042
Education & Training
7,050
11,500
11,500
11,500
11,500
74051
Rents
5,865
5,400
5,400
5,400
5,400
74071
Association Dues
321
1,000
1,000
1,130
1,130
Total Services
428,047
447,000
479,352
495,723
495,723
5
v
CITY OF BAYTOWN
SERVICE LEVEL BUDGET
3070 BAYTOWN AREA WATER AUTHORITY
Actual Budget Estimated Base Proposed
Acct## Acct Description 1999 -00 2000 -01 2000 -01 2001 -02 2001 -02
9900 Contingencies
99001 Contingencies - 40,000 - 40,000 40,000
Total Contingencies - 40,000 - 40,000 40,000
TOTAL DEPARTMENT $ 5,286,883 $ 5,558,638 $ 5,583,566 $ 5,708,418 $ 6,758,418
J
Total Operating
3,253,009 3,485,119 3,552,547 3,672,087
3,722,087
8000
Capital Outlay
84043
Motor Vehicles
- - - '45,000
45,000
Total Capital Outlay
- - - 45,000
45,000
9000
Other Financing Uses
91511
To BAWA Debt Service
2,033,874 2,033,519 2,031,019 1,951,331
2,329,258
91517
To BAWA Capital Improv
- - - -
622,073
Total Other Financing Uses
2,033,874 2,033,519 2,031,019 1,951,331
2,951,331
9900 Contingencies
99001 Contingencies - 40,000 - 40,000 40,000
Total Contingencies - 40,000 - 40,000 40,000
TOTAL DEPARTMENT $ 5,286,883 $ 5,558,638 $ 5,583,566 $ 5,708,418 $ 6,758,418
J
Ll
CITY OF BAYTOWN
BAYTOWN AREA WATER AUTHORITY REVENUE BONDS
LONG TERM DEBT AMORTIZATION SCHEDULES
Amount Requirements Amount
Revenue. Amount of Outstanding Fiscal Year 2001 -02 Outstanding
Bonds Issue October, 2001 Principal I Interest I Total Sept., 2002
Series, 1979 $
2,500,000 $
1,250,000 $
1,250,000 $
79,688 $
1,329,688
$ -
Series, 1994
815,000
815,000
-
48,493
48,493
815,000
Series, 1997
1,350,000
1,350,000
-
67,006
67,006
1,350,000
Series, 1999
9,095,000
9,095,000
-
506,145
506;145
9,095,000
Subtotal
490,000
12,510,000
1,250,000
701,331
1,951,331
11,260,000
Series, 2001 (estimated)
4,403,000
550,000
122,180
255,747
377,927
4,280,820
392,195
$
12,510,000 $
1,372,180 $
957,078 $
2,329,258
$ 15,540,820
Combined BAWA Debt, All Series
Debt Requirements to Maturity
Fiscal
Principal
Total
Total
Year
5/01
Interest
Requirement
2002
1,250,000
701,331
1,951,331
2003
1,015,000
621,644
1,636,644
2004
415,000
558,401
973,401
2005
440,000
534,733
974,733
2006
465,000
509,415
974,415
2007
490,000
482,500
972,500
2008
520,000
454,080
974,080
2009
550,000
423,545
973,545
2010
585,000
392,195
977,195
2011
610,000
362,945
972,945
2012
645,000
331,835
976,835
2013
675,000
298,618
973,618
2014
710,000
263,518
973,518
2015
745,000
225,888
970,888
2016
785,000
186,030
971;030
2017
825,000
143,640
968,640
2018
870,000
99,090
969,090
2019
915,000
51,240
966,240
$ 12,510,000
$ 6,640,646
$ 19,150,646
7
Combined BAWA Debt, All Series
OInterest
Debt Requirement to Maturity
2.500
■Principal
2.000
C T
= a
C pp
1.500
0 7
1.000.
E °
Q =
0.500
0.000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
2014 2015 2016 2017 2018 2019
Fiscal Year
7
CITY OF BAYTOWN
BAYTOWN AREA WATER AUTHORITY REVENUE BONDS
DETAIL DEBT AMORTIZATION SCHEDULES
Fiscal Interest Principal Interest Interest Annual Principal Total
Year Rate Due 5/01 Due 5/01 Due 11 /01 Requirement Outstanding Outstanding
Revenue Bond, Series 1979 Date of Issue - September 1, 1979 Term - 23 Years
2000 7.30% $ - $ 79,688 $ 79,688 $ 159,375 $ 2,500,000 $ 2,739,063
2001 7.30% 1,250,000 79,688 79,688 1,409,375 1,250,000 1,329,688
2002 7.30% 1,250,000 39,844 39,844 1,329,688 - -
$ 2,500,000 $ 199,219 $ 199,219 $ 2,898,438
Revenue Bond, Series
1994 Date of Issue - November 1, 1994
Term - 9 Years)
2000
5.95%
$ -
$ 24,246
$ 24,246
$ 48,493 $
815,000
$ 960,478
2001
5.95%
-
24,246
24,246
48,493
815,000
911,985
2002
5.95%
-
24,246
24,246
48,493
815,000
863,493
2003
5.95%
815,000
24,246
24,246
863,493
-
-
$ 815,000
$ 96,985
$ 96,985
$ 1,008,970
Revenue Bond, Series
1997 Date of Issue - December 4, 1997
Term -10 Years
2000
$ -
$ 33,503
$ 33,503
$ 67,006 $
1,350,000
$ 1,715,523
2001
-
33,503
33,503
67,006
1,350,000
1,648,516
2002
-
33,503
33,503
67,006
1,350,0001
1,581,510
2003
7.375%
200,000
33,503
33,503
267,006
1,150,000
1,314,504
2004
4.375%
205,000
26,128
26,128
257,256
945,000.
1,057,248
2005
4.450%
215,000
21,644
21,644
258,288
730,000
798,960
2006
4.550%
230,000
16,860
16,860
263,720
500,000
535,240
2007
4.600%
245,000
11,628
11,628
268,255
255,000
266,985
2008
4.700%
255,000
5,993
5,993
266,985
-
-
$ 1,350,000
$ 216,264
$ 216,264
$ 1,782,529
Revenue Bond, Series
1999 Date of Issue - November 1, 1999
Term - 20 Years
$ 16,019,675
2000
5.565%
$ -
$ 253,073
$ -
$ 253,073 $
9,095,000
15,766,603
2001
5.565%
-
253,073
253,073
506,145
9,095,000
15,260,458
2002
5.565%
-
253,073
253,073
506,145
9,095,000
14,754,313
2003
5.565%
-
253,073
253,073
506,145
9,095,000
14,248,168
2004
7.000%
210,000
253,073
253,073
.716,145
8,885,000
13,532,023
2005
7.000%
225,000
245,723
245,723
716,445
8,660,000
12,815,578
2006
7.000%
235,000
237,848
237,848
710,695
8,425,000
12,104,883
2007
7.000%
245,000
229,623
229,623
704,245
8,180,000
11,400,638
2008
7.000%
265,000
221,048
221,048
707,095
7,915,000
10,693,543
2009
5.700%
550,000
211,773
211,773
973,545
7,365,000
9,719,998
2010
5.000%
585,000
196,098
196,098
977,195
6,780,000
8,742,803
2011
5.100%
610,000
181,473
181,473
972,945
6,170,000
7,769,858
2012
5.150%
645,000
165,918
165,918
976,835
5,525,000
6,793,023
2013
5.200%
675,000
149,309
149,309
973,618
4,850,000
5,819,405
2014
5.300%
710,000
131,759
131,759
973,518
4,140,000
4,845,888
2015
5.350%
745,000
112,944
112,944
970,888
3,395,000
3,875,000
2016
5.400%
.785,000
93,015
93,015
971,030
2,610,000
2,903,970
2017
5.400%
825,000
71,820
71,820
968,640
1,785,000
1,935,330
2018
5.500%
870,000
49,545
49,545
969,090
915,000
966,240
2019
5.600%
915,000
25,620
25,620
966,240
-
-
$ 9,095,000
$ 3,588,874
$ 3,335,801
$ 16,019,675
H