Ordinance No. 9,917ORDINANCE NO. 9917
• AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS, APPROVING THE RECEIVER'S THIRD AMENDED
APPLICATION FOR WATER AND SEWER RATE INCREASE FOR BAY
OAKS HARBOR WATER AND SEWER SYSTEM; SETTING FORTH
OTHER PROVISIONS RELATED TO THE SUBJECT; PROVIDING A
REPEALING CLAUSE; CONTAINING A SAVINGS CLAUSE; AND
PROVIDING FOR THE EFFECTIVE DATE THEREOF.
WHEREAS, the City of Baytown, Texas (the "City") has exclusive original jurisdiction
over all water and sewer utility rates provided within its corporate limits; and
WHEREAS, John M. Fultz ( "Fultz "), who was appointed by the Texas Natural Resource
Conservation Commission ( "TNRCC ") as Temporary Manager for and is now Receiver for Bay
Oaks Harbor, Section I, has obtained a certificate of convenience and necessity from the TNRCC
(now the Texas Commission on Environmental Quality ( "TCEQ ")) for the provision of water
and wastewater services to Section I of the Bay Oaks Harbor Subdivision; and
WHEREAS, Fultz has requested the City's approval of his increasing the monthly rates
for the utilities as set forth in the Receiver's Third Amended Application For Water and Sewer
Rate Increase for Bay Oaks Harbor Water and Sewer System; and
WHEREAS, the City's Finance Department has reviewed the submitted rates and finds
the same to be fair, just, and reasonable; NOW THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS:
Section 1: That the City Council hereby adopts and affirms the findings and recitals
set forth in the preamble to this Ordinance.
Section 2: That the City Council having reviewed the rates hereby finds and
determines the water and sewer rates as submitted in the Receiver's Third Amended Application
for Water and Sewer Rate Increase for Bay Oaks Harbor Water and Sewer System, which is
attached hereto as Exhibit "A" and incorporated herein by this reference for all intents and
purposes, to be fair, just, and reasonable. Such rates are declared to be the maximum rates
permitted to be charged for water and sewer services in Bay Oaks Harbor, Section 1.
Section 3: That in adopting this Ordinance, the City Council of the City of Baytown
is not approving or acquiescing in any way whatsoever to cost data and/or methodologies not
specifically addressed in this ordinance. Furthermore, the City Council is not waiving any rights
to which it is entitled.
Section 4: All ordinances or parts of ordinances inconsistent with the terms of this
•
ordinance are hereby repealed; provided, however, that such repeal shall be only to the extent of
® such inconsistency and in all other respects this ordinance shall be cumulative of other
ordinances regulating and governing the subject matter covered by this ordinance.
Section 5: If any provision, section, exception, subsection, paragraph, sentence,
clause or phrase of this ordinance or the application of same to any person or the set of
circumstances, shall for any reason be held unconstitutional, void or invalid, such invalidity shall
not affect the validity of the remaining provisions of this ordinance or their application to other
persons or sets of circumstances and to this end all provisions of this ordinance are declared to be
severable.
Section 6: 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 26th day of October, 2004.
C--(:?� Q)
CALVIN MUNDINGER, Mayor
ATTEST:
- , �
GAY SMI T H, City Clerk
APPROVED AS TO FORM:
X
NACIO RAMIREZ, S . ity Attorney
is\ \Bdc2 \litigation\Karen \Files \City Council\Ordinances\SettingM axRales4BayOaksHarbor2004.doc
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No. GV3 -04117
STATE OF TEXAS,
§ IN THE DISTRICT COURT
and the TEXAS COMMISSION ON
§
ENVIRONMENTAL QUALITY,
§
Plaintiffs,
§
V.
§ TRAVIS COUNTY, TEXAS
ARETE REAL ESTATE AND
§
DEVELOPMENT COMPANY, INC.,
§
JOJAC /SEJAC, LTD., AND EMMES
§
BAY OAKS HARBOR I, LLC DBA BAY
§
OAKS HARBOR SUBDIVISION
§ 201St JUDICIAL DISTRICT
RECEIVER'S THIRD AMENDED APPLICATION FOR
WATER AND SEWER RATE INCREASE
UNDER TEXAS WATER CODE
TO THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS
COMES NOW, JOHN M. FULTZ, duly appointed Receiver for BAY OAKS HARBOR
WATER and SEWER SYSTEM (the "System "), and files this Third Amended Application for
Water Rate Increase pursuant to Texas Water Code and in support thereof would show the
following:
Ownership. Ownership of Certificate of Convenience and Necessity Nos. 12995 ( "CCN ") for
retail water service and 20912 ( "CCN ") for retail sewer service to Bay Oaks Harbor
Subdivision located in Harris County, Texas, is unknown. Arete Real Estate and
Development Company, Inc., JOJAC /SEJAC, Ltd., and Emmes Bay Oaks Harbor I, LLC,
d/b /a Bay Oaks Harbor Subdivision have been involved in the ownership and management of
the System in the past. The Attorney General's Office is currently investigating the ownership.
2. Abandonment. All prior owners have abandoned the System.
3. Appointment of Temporary Manager. John M. Fultz was appointed Temporary Manager of
Bay Oaks Harbor Water and Sewer System, PWS #101317, by the Texas Commission on
Environmental Quality ( "TCEQ "), formally Texas Natural Resources and Conservation
Commission, to take possession and control of the System by Order Appointing Temporary
Manager of a Water System entered on November 10, 2000, which Order has been extended
from time to time until the Receiver was appointed as set out below.
4. ATmointment of Receiver. John M. Fultz was appointed Receiver of the System by Order
Appointing Receiver entered on December 23, 2003, in the above styled and numbered cause
(the "Order ").
5. Legal Authority. The Order sets forth the duties and authority of the Receiver, including the
authority to file this Third Amended Application under Texas Water Code §13.1432 to secure
sufficient revenues for continuous, adequate, and lawful service of the System.
EMIT A
6. Receiver's Contact Information. The Receiver has operated the System since November 10,
• 2000, as Temporary Manager, and since December 23, 2003, as Receiver. The Receiver may
be contacted at:
•
John M. Fultz, Receiver
Bay Oaks Harbor Water and Sewer System
P. O. Box 868
Navasota, Texas 77868
Office Phone 936 -825 -7833
Office Fax 936 - 825 -2354
7. Request for Waiver of Filiniz Fee. Since the Receiver was appointed by the TCEQ and since
there is a shortage of funds available to the Receiver, the Receiver requests that any fees
chargeable to the filing of this Application be waived.
8. Pu ose of Application. This Application is made in order that the revenue requirements of
the System during the course of the Receivership can be met by rates sufficient to discharge
the operating expenses and pay outstanding debts to a prior operator and the Receiver.
9, Receiver's Third Amended Application. The Receiver previously filed an original application
and a First Amended Application. The Receiver received information that the RV Park
previously operated in the Subdivision was closed on or about July 15, 2004, altering the
potential income of the System. A Second Amended Application for Rate Increase was later
filed. The City has increased its rates charged for water and sewer since the filing of the
Second Amended Application, and after consultation with City Staff, it was determined that it
was appropriate to amend the Second Amended Application, and thus the Receiver now files
this Third Amended Application.
10. Description of the Water and Sewer System. The Receiver operates one water system and one
sewer system currently serving a current monthly average of approximately 141 residential
connections. The System is fully metered and is located entirely within the corporate
boundaries of the City of Baytown.
11. Current Tariff. The Receiver operates the System pursuant to rate schedules approved by The
City of Baytown, Harris County, Texas, on November 30, 2000, as shown on the following
Rate Schedules:
The Remainder of this page intentionally left blank.
CURRENT TARIFF - WATER
WATER TARIFF
Section 1.01 Rates Monthly Base Rate Gallonage Char
Meter Size
Residential
5/8" or 3/4" $ 15.00 (including 0 gallons) $2.56 per 1000 gallons
Commercial $100.00 $2.56 per 1000 gallons
Plus $15.00 per Inhabited Residence
SURCHARGE Residential & Commercial $0.50 per 1000 gallons
Same for aka meter sizes
REGULATORY ASSESSMENT 1.0%
A REGULATORY ASSESSMENT, EQUAL TO ONE PERCENT
OF THE CHARGE FOR WATER SERVICE ONLY, SHALL BE
COLLECTED FROM EACH CUSTOMER
Section 1.02 - Miscellaneous Fees
TAP FEE $500.00
TAP FEE IS BASED ON THE UTILITY'S ACTUAL COSTS FOR
MATERIALS AND LABOR FOR A STANDARD RESIDENTIAL
CONNECTIONS OF 5l8" OR 3/," iMETER.
RECONNECTION FEE
THE RECONNECT FEE WILL BE CHARGED BEFORE SERVICE
CAN BE RESTORED TO A CUSTOMER WHO HAS BEEN
DISCONNECTED FOR THE FOLLOWING REASONS:
(A) NON PAYMENT OF BILL (Maximum of $25.00)
$ 25.00
(B) AT THE CUSTOMER'S REQUEST
$ 30.00
TRANSFER FEE
$ 25.00
THE TRANSFER FEE WILL BE CHARGED FOR CHANGING
AN ACCOUNT NAME AT THE SAME SERVICE LOCATION
WHEN THE SERVICE IS NOT DISCONNECTED
LATE CHARGE
$ 5.00
ONE TIME PENALTY MAY BE MADE ON DELINQUENT
BILLS BUT MAY NOT BE APPLIED TO ANY BALANCE TO
WHICH THE PENALTY WAS APPLIED ON A PREVIOUS BILLING
RETURNED CHECK CHARGE
$ 25.00
CUSTOMER DEPOSIT (Maximum $50)
$ 50.00
METER TEST FEE (actual cost of testing the meter up to) $ 25.00
TEST FEE MAY BE CHARGED IF CUSTOMER REQUESTS A
SECOND METER TEST WITHIN A TWO YEAR PERIOD AND
THE TEST INDICATES THAT THE METER IS RECORDING ACCURATELY.
•
CURRENT TARIFF - SEWER
SEWER TARIFF
Section 1.01 Rates
Section 1.02 - Miscellaneous Fees
TAP FEE $500.00
TAP FEE IS BASED ON THE UTILITY'S ACTUAL COSTS FOR
MATERIALS AND LABOR FOR A STANDARD RESIDENTIAL
CONNECTIONS OF 5/8" OR' /;' METER.
RECONNECTION FEE
THE RECONNECT FEE WILL BE CHARGED BEFORE SERVICE
Monthly Base Rate
Gallonage Charge
Meter Size
DISCONNECTED FOR THE FOLLOWING REASONS:
Residential
$ 25.00
(b) AT THE CUSTOMER'S REQUEST
5/8" or 3/4"
$ 20.00 (including 0 gallons)
$2.33 per 1000 gallons
THE TRANSFER FEE WILL BE CHARGED FOR CHANGING
same for all meter sizes
Commercial
$100.00
$2.33 per 100
LATE CHARGE
Plus $20.00 per Inhabited Residence
ONE TIME PENALTY MAY BE MADE ON DELINQUENT
SURCHARGE
Residential & Commercial
$0.50 per 1000 gallons
WHICH THE PENALTY WAS APPLIED ON A PREVIOUS BILLING
same for all meter sizes
Section 1.02 - Miscellaneous Fees
TAP FEE $500.00
TAP FEE IS BASED ON THE UTILITY'S ACTUAL COSTS FOR
MATERIALS AND LABOR FOR A STANDARD RESIDENTIAL
CONNECTIONS OF 5/8" OR' /;' METER.
RECONNECTION FEE
THE RECONNECT FEE WILL BE CHARGED BEFORE SERVICE
CAN BE RESTORED TO A CUSTOMER WHO HAS BEEN
DISCONNECTED FOR THE FOLLOWING REASONS:
(a) NON PAYMENT OF BILL (Maximum of $25.00)
$ 25.00
(b) AT THE CUSTOMER'S REQUEST
$ 30.00
TRANSFER FEE
$ 25.00
THE TRANSFER FEE WILL BE CHARGED FOR CHANGING
AN ACCOUNT NAME AT THE SAME SERVICE LOCATION
WHEN THE SERVICE IS NOT DISCONNECTED
LATE CHARGE
$ 5.00
ONE TIME PENALTY MAY BE MADE ON DELINQUENT
BILLS BUT MAY NOT BE APPLIED TO ANY BALANCE TO
WHICH THE PENALTY WAS APPLIED ON A PREVIOUS BILLING
RETURNED CHECK CHARGE
$ 25.00
CUSTOMER DEPOSIT (Maximum $50)
$ NONE
The remainder of this page intentionally left blank.
2
12. Financial Records. The Receiver operated the System from November 10, 2000, as
• Temporary Manager, and from December 23, 2003, to the present, as Receiver, and has
compiled financial records covering those periods of time. The records used to prepare this
Rate Application are based upon the period from August 1, 2003, through July 31, 2004,
sometimes referred to as the "Test Year ".
13, Test Year Operating Revenues. Income from customer payments for the period from August
1, 2003, to July 31, 2004, was $140,266.33, or an average of $11,688.60 per month. Expenses
incurred for operating the system were $146,030.88, or an average of $12,16924 per month.
This resulted in a deficit in the amount of $5,764.55 for the Test Year.
14. Revenue Proiection at Current Rates. The current number of connections is 141 residential
customers and 0 RV connections. Using the current Tariff rates and an average consumption
of 4,000 gallons a month per customer, Receiver projects that Operating Revenue for the year
beginning August 1, 2004, and ending July 31, 2005, will be approximately $93,195.36, at a
100% collection rate.
15. Accrued Indebtedness Unpaid. The sum of $23,360.65 is owed to a prior operator for services
rendered for repairs to the system and unpaid prior to July 31, 2004. Though the Receiver's
Fee was incurred during the test year, all payments due were not actually made to the
Receiver, and the sum of $31,939.00 is owed to the Receiver for services rendered to the
System and unpaid through July 31, 2004.
16. Estimated Operating Requirements. The estimated Monthly Operating Requirements
calculated using the average of the expenses incurred during the Test Year are as follows:
Expenses
Monthly
Yearly
Operator's Monthly Fee
$2,000.00
$24,000.00
Operator's Additional Charges
Taps & Bores
$ 650.00
$ 7,800.00
Repairs to water
$ 300.00
$ 3,600.00
Repairs to sewer
$2,100.00
$25,200.00
Bank charges
$ 100.00
$ 1,200.00
Office expenses
$ 50.00
$ 600.00
Fuel assessment $ 1.50 per connection/monthly
$ 21 1.50
$ 2,538.00
Utilities
$ 300.00
$ 3,600.00
City of Baytown - water
$2,152.83
$25,834.00
City of Baytown — sewer
$2,044.00
$24,528.00
Receiver's Fee @ $ 12.00 per connection
$1,692.00
$20,304.00
Receiver's staff
$ 350.00
$ 4,200.00
Bond/insurance covering Receiver
$ 4.17
$ 50.00
Total Monthly Overhead Revenue Requirement
$11,954.50
Monthly Overhead Revenue Requirement Annualized
$143,454.00
Balance owed prior Operator ($23,360.65)
$ 1,000.00
$12,000.00
Prior Fees owed Temporary Manager ($31,939)
$ 1,330.80
$15,969.50
®
Total Monthly Debt Retirement
$ 2,330.80
Monthly Debt Retirement Annualized
$27,969.50
• 17. Comparison of Estimated Revenues to Estimated Expenses. The estimated annual revenue at
the current rates is approximately $93,195.36. The estimated annual costs to operate are
approximately $143,454.00. This leaves a deficiency of approximately $50,259.00 for
overhead expenses. In addition, outstanding debt owed to former operator and outstanding
debt owed to Receiver in the total amount of $54,299.65 would bring the total deficiency to
approximately $104,559.00.
•
18. Proposed Rate Increase. The average monthly revenue requirement dictates that the rates
charged for minimum monthly service as well as the gallonage charge must be increased. The
Receiver requests the City's consideration of an increase per month described as follows:
(1) Water Monthly Minimum Charge: From $15.00 to $23.60 (including 0 gallons);
(2) Water Gallonage Charge: From $2.56 to $3.69 per 1000 gallons;
(3) Sewer Monthly Minimum Charge: From $20.00 to $28.60 (including 0 gallons);
(4) Sewer Gallonage Charge: From $2.33 to $3.50 per 1000 gallons.
These figures do not include recovery of return on invested capital or depreciation. The
Receiver does not have any information pertaining to the System's base rate or depreciation.
Revenues projected from the proposed Rate Schedule set forth in Paragraph 23 below are
calculated to generate approximately $143,714.16, close to the System's cash needs revenue
requirement of approximately $143,454.00, at a 100% collection rate. The Receiver will,
through the Operator, maintain an accounting of all revenues collected and all expenditures
incurred during the course of the Receivership.
19. Proposed Surcharge. The outstanding debt owed to former operator and outstanding debt
owed to Receiver in the total amount of $54,299.65, dictates that a surcharge be assessed for a
period of twenty -four months to repay outstanding debt owed to the former operator and to the
Receiver. The Receiver requests the City's consideration of a surcharge per month for a
period of 24 months as follows:
(1) Surcharge for a period of 24 months of $8.25 per connection for water, and,
(2) Surcharge for a period of 24 months of $8.25 per connection for sewer.
20. Effective Date of Rate Increase and Surcharge. The Receiver intends that the Rate Increase
and Surcharge described above take effect with service commencing on December 1, 2004,
21. Notice of Rate Increase and Surcharge. Upon authorization of the Rate Increase and
Surcharge here proposed, the Receiver shall provide notice of the rate increase as required by
TCEQ rules and regulations.
22. Proposed Rates for Water and Sewer. The Receiver requests approval by The City of
Baytown, Harris County, Texas, of an increase in water and sewer rates and a surcharge as
shown on the following Rate Schedules:
rol
PROPOSED RATE SCHEDULE - WATER
Section 1.01— Water Rates
Meter Size Monthly Base Rate Gallonage Charge
Residential
5/8" or 3/4" $ 23.60 (INCLUDING 0 GALLONS) $3.69 per 1000 gallons
Commercial $125.00 (INCLUDING 0 GALLONS) $3.69 per IOW gallons
Plus $23.60 per inhabited residence
SURCHARGE Residential & Commercial $8.25 per connection
REGULATORY ASSESSMENT 1.0%
A REGULATORY ASSESSMENT, EQUAL TO ONE PERCENT
OF THE CHARGE FOR WATER SERVICE ONLY, SHALL
BE COLLECTED FROM EACH CUSTOMER
Section 1.02 - Miscellaneous Fees
TAPFEE ........... .......... .......................................... I .............. ........................$500.00
TAP FEE IS BASED ON THE AVERAGE OF THE UTILITY'S
ACTUAL COST FOR MATERIALS AND LABOR FOR STANDARD
RESIDENTIALCONNECTION OF 518" or 314" METER PLUS
UNIQUE COSTS LIKE ROAD BORES PERMITTED BY TCEQ RULE AT COST.
TAPFEE ................................................................. ............................... ......$500.00
TAP FEE IS BASED ON THE UTILITY'S ACTUAL COST FOR MATERIALS
AND LABOR FOR NON - STANDARD RESIDENTIALCONNECTION.
RECONNECTION FEE
THE RECONNECT FEE WILL BE CHARGED BEFORE SERVICE
CAN BE RESTORED TO A CUSTOMER WHO HAS BEEN
DISCONNECTED FOR THE FOLLOWING REASONS:
a) Non payment of bill (Maximum $25.00) .............. .........................$25.00
b) Customer's request ........... ............................... .........................$30.00
TRANSFERFEE ...................................... ............................... .........................$25.00
THE TRANSFER FEE WILL BE CHARGED FOR CHANGING
AN ACCOUNT NAME AT THE SAME SERVICE LOCATION
WHEN THE SERVICE IS NOT DISCONNECTED.
LATECHARGE ................................................................. ............................... $10%
A LATE PENALTY OF 10 %. WILL BE CHARGED ON PAYMENTS
RECEIVED AFTER THE DUE DATE, BUT MAY NOT BE
APPLIED TO ANY BALANCE TO WHICH THE PENALTY
WAS APPLIED IN A PREVIOUS BILLING.
RETURNED CHECK CHARGE .................................... ............................... ........$25.00
CUSTOMER DEPOSIT (Maximum $ 50) ......... ............................... .........................$50.00
METER TEST FEE (actual cost of testing the meter up to) ..................... .........................$25.00
THIS FEE MAY BE CHARGED IF A CUSTOMER REQUESTS A
• SECOND METER TEST WITHIN A TWO YEAR PERIOD AND THE
TEST INDICATES THAT THE METER IS RECORDING ACCURATELY.
METER RELOCATION FEE .................... .........................Actual Cost to Relocate Meter
7
•
PASS THROUGH PROVISION
Changes in fees imposed by any wholesale water supplier or underground water district
having jurisdiction over the Utility shall be passed through as an adjustment to the water
gallonage charge according to the formula:
AG = B /(1 -L), Where:
AG = adjusted gallonage charge, rounded to nearest one cent
G = approved per 1000 gallon gallonage charge
B = change in district fee per 1000 gallons
L = system average line loss for preceding 12 months, not to exceed 0.15
To implement or modify the Purchased Water/Underground Water District Fee, the
Utility must comply with all notice and other requirements of 30 TAC 291.21(h).
TEMPORARY WATER RATE:
Unless otherwise superseded by TCEQ order or rule, if the Utility is ordered by a court or
governmental body of competent jurisdiction to reduce its pumpage, production, or water sales,
the Utility shall be authorized to increase its approved gallonage charge according to the
formula:
TGC = cgc + (prr)(cqc)(r)
(1.0 -r)
Where:
TGC = temporary gallonage charge
cgc = current gallonage charge
r = water use reduction expressed as a decimal fraction
(the pumping restrictions)
prr = percentage of revenues to be recovered expressed
as a decimal fraction (i.e. 100% = 1.0), for
this tariff prr shall equal 0.5.
To implement the Temporary Water Rate, the Utility must comply with all notice and
other requirements of 30 TAC 291.21(1).
The remainder of this page intentionally left blank.
0
PROPOSED RATE SCHEDULE - SEWER
• Section 1.01— Sewer Rates
Meter Size Monthly Base Rate Gallonage Charge
Residential $ 28.60 (INCLUDING 0 GALLONS) $3.50 per 1000 gallons
Commercial $125.00 (INCLUDING 0 GALLONS) $3.50 per 1000 gallons
Plus $28.60 per inhabited residence
SURCHARGE Residential & Commercial $8.25 per connection
REGULATORY ASSESSMENT 1.0%
A REGULATORY ASSESSMENT, EQUAL TO ONE PERCENT
OF THE CHARGE FOR WATER SERVICE ONLY, SHALL
BE COLLECTED FROM EACH CUSTOMER
Section 1.02 - Miscellaneous Fees
TAPFEE ............................................... ............................... ........................$500.00
TAP FEE IS BASED ON THE AVERAGE OF THE UTILITY'S ACTUAL ........
FOR MATERIALS AND LABOR FOR STANDARD RESIDENTIAL
CONNECTION OF 5/8" or 3/4" METER PLUS UNIQUE COSTS LIKE ROAD
BORES PERMITTED BY TCEQ RULE AT COST.
TAPFEE_ ................................. I ............ I I .................................................. $500.00
TAP FEE IS BASED ON THE UTILITY'S ACTUAL COST FOR
MATERIALS AND LABOR FOR NON- STANDARD RES I DENT [A LCONN ECTION.
RECONNECTION FEE
THE RECONNECT FEE WILL BE CHARGED BEFORE SERVICE
CAN BE RESTORED TO A CUSTOMER WHO HAS BEEN
DISCONNECTED FOR THE FOLLOWING REASONS:
a) Non payment of bill (Maximum $ 25. 00) ........ ..............................$ 25.00
b) Customer's request ....... ............................... .........................$30.00
TRANSFERFEE..... . .......................... ...................................................... ...... $25.00
THE TRANSFER FEE WILL BE CHARGED FOR CHANGING
AN ACCOUNT NAME AT THE SAM E SERVICE LOCATION
WHEN THE SERVICE IS NOT DISCONNECTED,
LATECHARGE ................................................................. ............................... $10%
A LATE PENALTY OF 10 %. WILL BE CHARGED ON BILLS
RECEIVED AFTER THE DUE DATE, BUT MAY NOT BE
APPLIED TO ANY BALANCE TO WHICH THE PENALTY
WAS APPLIED IN A PREVIOUS BILLING
RETURNEDCHECK CHARGE ......................................... ............................... $25.00
CUSTOMER DEPOSIT (Maximum $ 50) ............................... ............................... $NONE
METER TEST FEE (actual cost of testing the meter up to) ..................... .........................$25.00
THIS FEE MAY BE CHARGED IF A CUSTOMER REQUESTS A
SECOND METER TEST WITHIN A TWO YEAR PERIOD AND THE
• TEST INDICATES THAT THE METER IS RECORDING ACCURATELY.
METER RELOCATION FEE ............. .........................Actual Cost to Relocate Meter.
9
23. Known and Measurable Changes. The RV Park consisted of 67 possible connections. It was
closed on or about July 15, 2004. The RV Park absorbed the excess loss due to leaks and any
losses were assessed to the RV park. The closing of the RV Park creates a substantial loss in
revenue. The RV Park previously paid the electricity bill monthly. That expense will now be
placed on the remaining customers. Due to the recent increases in the cost of fuel, the
Operator has advised the Receiver that the Operator anticipates requesting an increase of
51.50 per customer per month to cover such increased costs. This will result in an additional
cost to the System of approximately $2,538.00 annually. The estimates are based upon 100%
collections. The anticipated income will not cover all expenses, as a shortfall is anticipated
even with the rate increase, at least in the initial years. With the collection of a surcharge to
each system in the amount of $8.25 per connection for two years, the Receiver's past due
account will be paid in full, as will the outstanding debt owed to the prior operator. At that
time, the Receiver may seek another surcharge for capital improvements and the needed
upgrades to the System for it to be subsumed into the City's system, which was the original
goal of the Receiver.
24. Conclusion. The requested Rate Increase is necessary to ensure the provision of continuous
and adequate service to the customers of the System in accordance with the Court's Order.
Professional management of the System's affairs is essential to the timely and accountable
conduct of the System's operations, maintenance, repairs, accounting, and legal
responsibilities required by TCEQ rules. Long term deficiencies in the rates have resulted in
the failure to generate capital needed to make long needed repairs to the System, and thus the
continued and repeated violations of TCEQ rules which led to the enforcement action now
pending in this action. Additionally, these same deficiencies in the rates have resulted in the
failure to generate capital needed to retire the debt owed the prior operator, pay the Receiver
for his services, and accumulate capital for the improvement, repair, and maintenance of the
System.
25. Re guest for Approval- The Receiver accordingly requests that this Application be
immediately approved, with an effective date of December 1, 2004.
ly Sub
FULTZ, Deceiver
Certificate of S vice
I, JOHN M. FULTZ, Receiver, certify that a copy of the foregoing Receiver's Third
Amended Application for Water Rate Increase pursuant to Texas Water Code, was forwarded on
September 20, 2004, to the following:
Mr. Michael Conway, TCEQ Receivership Coordinator, MC 153
Ms. Lisa Richardson, Assistant Attorney General for State of Texas
Mr. Rick Wagner, Wagner Services, Inc., Operator
•
Jo M. Fultz
10
AGREEMENT
STATE OF TEXAS §
COUNTY OF HARRIS §
This Agreement is made and entered into, and executed by and between, John M. Fultz, Court
Appointed Receiver for Bay Oaks Harbor Water and Sewer System, hereinafter referred to as the
"Receiver," the Bay Oaks Harbor Property Owners' Association, a Texas non-profit corporation,
hereinafter referred to as the "POA," and the City of Baytown, Harris and Chambers Counties, Texas, a
political subdivision of the State of Texas, acting by and through the governing body,hereinafter referred
to as the"City."
In consideration of the premises and the covenants hereinafter set forth, the City, POA and the
Receiver agree as follows:
I.
City's Responsibilities
1.01 Contingent upon receipt of the payment specified in Article III hereof, the City hereby agrees to
perform or cause to be performed an investigative study of the water and wastewater systems in
Bay Oaks Harbor Subdivision, Section I. Such study shall be the property of the City; however,
after the study has been finally accepted and approved by the City,the City shall tender one copy
of such study to the Receiver and one copy of such study to the POA.
1.02 Within thirty (30) days of the acceptance of the investigative study by the City, the City shall
refund to the POA the portion of the amount it paid pursuant to Article III hereof which is in
excess of the cost to the City of the investigative study, if any.
II.
Receiver's Responsibilities
2.01 The Receiver agrees to fully cooperate with the City in the performance of its responsibilities
enumerated in Article I hereinabove.
2.02 The Receiver hereby represents and warrants that it has not conveyed, transferred, assigned,
pledged or otherwise encumbered any of its rights in the Improvements and has full authority and
power to make all agreements contained herein.
2.03 During the term of this Agreement, the Receiver hereby grants to the City the right of ingress and
egress to and from the Improvements for the purpose of performing the investigative study.
III.
POA's Responsibilities
3.01 The POA understands and agrees that it will be responsible for the cost of the investigative study
to be performed by the City pursuant to Section 1.01 up to a maximum amount of FIFTY
THOUSAND AND NO/100 DOLLARS ($50,000.00). As such, within ten (10) days of the
Agreement,Page 1
effective date of this Agreement, the POA shall tender such amount in full to the City. The POA
will be entitled to a refund of a portion of the amount tendered only if the cost to the City of the
investigative study is less than FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00).
3.02
THE POA AGREES THAT THE POA SHALL INDEMNIFY, HOLD
HARMLESS, AND DEFEND THE CITY, ITS OFFICERS, AGENTS AND
EMPLOYEES AS WELL AS THE RECEIVER (COLLECTIVELY
REFERRED TO IN THIS ARTICLE AS THE "INDEMNITEES"), FROM
AND AGAINST ANY AND ALL CLAIMS, LOSSES, DAMAGES, CAUSES
OF ACTION, SUITS AND LIABILITY OF EVERY KIND, INCLUDING
ALL EXPENSES OF LITIGATION, COURT COSTS, AND ATTORNEYS'
FEES, FOR ANY AND ALL DAMAGES TO THE STREETS, ALLEYS,
AND SIDEWALKS AND WATER AND/OR SEWER SYSTEMS,
INCLUDING ALL APPURTENANCES RELATED THERETO
(COLLECTIVELY REFERRED TO AS THE "IMPROVEMENTS"),
ARISING OUT OF OR IN CONNECTION WITH THE SERVICES TO BE
PERFORMED BY THE INDEMNITEES PURSUANT TO THIS
AGREEMENT, WHERE SUCH DAMAGES ARE CAUSED BY THE
SOLE OR JOINT NEGLIGENCE OF THE INDEMNITEES AND ANY
OTHER PERSON OR ENTITY AND/OR BY THE JOINT OR SOLE
NEGLIGENCE OF THE POA. IT IS THE EXPRESSED INTENTION OF
THE PARTIES HERETO, THE POA, THE RECEIVER AND THE CITY,
THAT THE INDEMNITY PROVIDED FOR IN THIS PARAGRAPH IS
INDEMNITY BY THE POA TO INDEMNIFY AND PROTECT THE
INDEMNITEES FROM THE CONSEQUENCES OF (I) THE
INDEMNITEES' NEGLIGENCE, WHERE THAT NEGLIGENCE IS THE
SOLE OR A CONCURRING CAUSE OF THE RESULTING DAMAGE
TO THE IMPROVEMENTS AND/OR (II) THE POA'S JOINT AND/OR
SOLE NEGLIGENCE. IN THE EVENT THAT ANY ACTION OR
PROCEEDING IS BROUGHT AGAINST THE CITY BY REASON OF
ANY OF THE ABOVE, THE POA FURTHER AGREES AND
COVENANTS THAT THE POA SHALL DEFEND THE ACTION OR
PROCEEDING BY LEGAL COUNSEL ACCEPTABLE TO THE CITY
AND THE RECEIVER.
The indemnity provided hereinabove shall survive the termination and/or expiration of this
Permit.
3.03 The POA hereby represents and warrants that it has not conveyed, transferred, assigned,pledged
or otherwise encumbered any of its rights in the Improvements and has full authority and power
to make and honor all agreements contained herein.
Agreement,Page 2
• 3.04 During the term of this Agreement, the POA hereby grants to the City the right of ingress and
egress to and from the Improvements for the purpose of performing the investigative study.
3.05 Throughout the term of this Agreement,the POA at its own expense shall purchase,maintain and
keep in force and effect insurance against claims for injuries to or death of persons or damages to
property which may arise out of or result from the investigative study required herein. The
POA's insurance coverage shall be primary insurance with respect to the City, its officers, agents
and employees, and the Receiver. Any insurance or self-insurance maintained by the City, its
officials, agents and employees shall be considered in excess of the POA's insurance and shall
not contribute to it.
The following insurance shall be required under this Agreement and shall meet or exceed the
minimum requirements set forth herein:
• Commercial General Liability
• General Aggregate: $1,000,000
• Per Occurrence: $500,000
• Coverage shall be at least as broad as ISO CG 00 01 10 93
• No coverage shall be deleted from standard policy without notification of
individual exclusions being attached for review and acceptance.
Prior to any work being performed on the site,the POA shall file with the City a valid Certificate
of Insurance and endorsements acceptable to the City. Such Certificate shall contain a provision
that coverage afforded under the policies will not be canceled, suspended, voided, or reduced
until at least thirty (30) days' prior written notice has been given to the City via certified mail,
return receipt requested.
The following are general requirements applicable to the required policy:
➢ AM Best Rating of B+; VII or better.
➢ The insurance carrier must be licensed and admitted to do business in State of Texas.
➢ The liability policy must be on occurrence form.
> The policy shall be endorsed to state that coverage shall not be suspended, voided, canceled
or reduced in coverage or in limits except after thirty (30) days' prior written notice by
certified mail,return receipt requested,has been given to the City.
> The City, its officers, agents and employees are to be added as Additional Insureds to the
liability policy.
> Upon request of and without cost to City of Baytown, a certified copy of the insurance policy
and/or the certificate of insurance shall be furnished to City of Baytown's representative.
Certificates of insurance showing evidence of insurance coverage shall be provided to City of
Baytown's representative prior to any work being performed at the site.
> Upon request of and without cost to City of Baytown, loss runs(claims listing)of any and/or
all insurance coverage shall be furnished to City of Baytown's representative.
IV.
Term
4.01 The term of this Agreement shall commence upon the signing of this Agreement by the City
Manager and shall remain in full force and effect, unless terminated in accordance with Section
4.02, until the investigative study is completed and accepted by the City. Nothing contained in
Agreement,Page 3
this section shall be construed, however, to terminate Sections 3.02, 5.01, and 5.02 of this
Agreement, as such provisions shall remain in full force and effect after the termination and/or
expiration of this Agreement.
4.02 This Agreement, with the exception of those provisions not subject to termination, may be
terminated by either party hereto with or without cause upon giving at least 10 days' written
notice of such termination. Upon termination, the City shall cease performing or causing to be
performed the investigative study and the POA shall be responsible for all costs incurred by the
City in the performance of the study to the date of termination along with all other termination
charges,which may be contained in the investigative study agreement.
V.
General Provisions
5.01 The parties understand and agree that the City has never accepted the utilities or any other
purported dedication contained in the plat of the subdivision or any other recorded instrument;
and the parties agree that nothing contained herein or any work performed pursuant to this
Agreement or any previous entry or use of the parts purported to be dedicated shall be deemed
acceptance of or appropriation of the dedicated parts by formal acceptance, entry, use or
improvement.
5.02 By this Agreement, the City does not consent to litigation or suit, and the City hereby expressly
revokes any consent to litigation that it may have granted by the terms of this Agreement or any
other contract or agreement, any charter, or applicable state law. Both the Receiver and the POA
hereby release, relinquish and discharge the City, its officers, agents, and employees from all
claims, demands, and causes of action of every kind and character, including the cost of defense
thereof, for any injury to or death of any person(whether they be either of the parties hereto,their
employees, or other third parties)and any loss of or damage to property(whether the property be
that of either of the parties hereto, their employees, or other third parties) that is caused by or
alleged to be caused by, arising out of, or in connection with the services to be performed
hereunder. This release shall apply with respect to the services to be performed or caused to be
performed by the City regardless of whether said claims, demands, and causes of action are
covered in whole or in part by insurance.
5.03 Notwithstanding anything to the contrary contained in this Agreement,the City,the POA and the
Receiver hereby agree that no claim or dispute between the City and the Receiver arising out of
or relating to this Agreement shall be decided by any arbitration proceeding including, without
limitation, any proceeding under the Federal Arbitration Act (9 U.S.C. Section 1 - 14), or any
applicable State arbitration statute, including, but not limited to, the Texas General Arbitration
Act, provided that in the event that the City is subjected to an arbitration proceeding
notwithstanding this provision, the Receiver consents to be joined in the arbitration proceeding if
the Receiver's presence is required or requested by the City of complete relief to be recorded in
the arbitration proceeding.
5.04 This Agreement shall be construed in accordance with, and governed by, the laws of the State of
Texas. Venue shall lie exclusively in Harris County,Texas.
5.05 In the event any one or more of the sections, provisions or clauses contained herein shall for any
reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or
Agreement,Page 4
unenforceability shall not affect any other provision of this Agreement, but this Agreement shall
be construed as if such invalid, illegal or unenforceable provision had not been contained herein.
5.06 In the event of any ambiguity in any of the terms of this Agreement, it shall not be construed for
or against any party hereto on the basis that such party did or did not author the same.
5.07 Failure of any party hereto to insist on the strict performance of any of the agreements herein or
to exercise any rights or remedies accruing thereunder upon default or failure of performance
shall not be considered a waiver of the right to insist on and to enforce,by an appropriate remedy,
strict compliance with any other obligation hereunder or to exercise any right or remedy
occurring as a result of any future default or failure of performance.
5.08 No right or remedy granted herein or reserved to the City is exclusive of any other right or
remedy herein by law or equity provided or permitted,but each shall be cumulative of every other
right or remedy given hereunder.
5.09 The Receiver and the POA shall not sell, assign, or transfer any of their rights or obligations
under this Agreement in whole or in part without prior written prior consent of the City.
5.10 This Agreement shall not be modified or amended except by a written instrument executed by the
Receiver,the POA and the City.
5.11 This Agreement may be executed in triplicate original counterparts, each of which when so
executed shall be deemed to be an original, and such counterparts shall together constitute but one
and the same instrument.
5.12 The persons executing this Agreement on behalf of the City, the POA and the Receiver hereby
represents that such officers have full authority to execute this Agreement and to bind the parties
each represents.
IN WITNESS WHEREOF, the City and the Receiver has executed this Agreement effective as of
the ' day of ji' ,L-i, , 2005.
CITY 0 BA OW
ARY AC S , City Manager
ATTEST:
G�7ttft
ITH, City Clerk
APPROVED AS TO FORM:
NACIO RAMIRE ty Z, SR. Attorney
Agreement,Page 5
AGREED AND ACCEPTED this theo28 day of ?rasr-r2 , 2005.
RECEIVER
0 M. FULTZ,Recei er
BAY OAKS HARBOR
ER AND SEWER SYSTEM
STATE OF TEXAS §
COUNTY OF VY I §
Before me, I fa CAI L. 0 tOi15 , the undersigned notary public, on this day personally
appeared JOHN M. FULTZeceiver of Bay Oaks Harbor Water and Sewer System, known to me to be
the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he
executed that instrument for the purposes and consideration therein expressed.
Given under my hand and seal of office this =/\ day of P 19Y a a i r y , 2005.
0,0, PL4, TRACY L. DOWNS b
11* ; NOTARY PUBLIC,STATE OF TEXAS
h �,�1�
m; + MY COMMISSION EXPIRES \ Notary Publi i and for the
FOF-ts JUNE 7, 2006 k
!!!!!!!!!!!!!!!!!!!!!!llp State of Texas
AGREED AND ACCEPTED this the 4th day of February , 2005.
POA
ignature
JACA -T7'� o�/
Printed Name
Title
BAY OAKS HARBOR PROPERTY
OWNERS' ASSOCIATION
STATE OF TEXAS §
COUNTY OF HARRIS §
Before me, Sylvia Ann Aguilar , the undersigned notary public, on this day personally
appeared Jack Patterson , the Sec./Teeas. of Bay Oaks Harbor Property
Owners' Association, known to me to be the person whose name is subscribed to the foregoing
Agreement,Page 6
instrument, and acknowledged to me that he executed that instrument for the purposes and consideration
therein expressed.
Given under my hand and seal of office this 4th day of Februar
QmmissionExpires,0.25.2005
VIA ANN AGUILAR
Notary Public,State of TexasNotary ublic nd f e
State of Texas
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