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Ordinance No. 10,402ORDINANCE NO. 10,402 Aoft, 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, 2006, AND ENDING SEPTEMBER 30,2007; 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, 2006, and ending September 30, 2007; 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, 2006. and ending September 30, 2007, in the amount of SIX MILLION EIGHT HUNDRED SEVENTY - THREE THOUSAND EIGHT HUNDRED THIRTY AND NO/] 00 DOLLARS ($6,873,830.00). 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 ofd City Council of the City of Baytown this the 14'' day of September, 2006. , APPROVED AS TO FORM: APb- ACIO RAMIREZ, SR., y Attorney R:Ueanene\My Documents \Council\05- 06\September 1st\AdoptBAWABudgetFY06- 07.doc H. DONCARLOS, Mayor Baytown Area Water Authority (BAWA) ANNUAL PROGRAM OF SERVICES 2006 -07 PROPOSED BUDGET Submitted To Baytown Area Water Authority Board Gary Jackson Av- Fred Pack Rhonda Young August 16, 2006 EXHIBIT A General Manager Plant Manager Director of Finance BAYTOWN AREA WATER AUTHORITY BOARD OF DIRECTORS ROBERT L. GILLETTE, President DAN MUNDINGER, Vice President PETER R. BUENZ, Secretary KNOX BEAVERS DAN CONEJO Alk BAYTO WN AREA WATER AUTHORITY 7425 Thompson Road, Baytown, Texas 77521 -1056 (281) 426 -3517 FAX (281) 426 -3519 August 16, 2006 President and Members of the Baytown Area Water Authority Board Baytown Area Water Authority Baytown, Texas It is my pleasure to present the Proposed 2006 -07 Budget for the Baytown Area Water Authority (BAWA) Board. The Budget sets forth the revenues and appropriations for the fiscal year October 1, 2006 through September 30, 2007. The financial guidance provided by the Board has resulted in BAWA's strong financial position exhibited by a stable working capital balance. The use of non - recurring revenues to fund a portion of the capital improvement program will reduce the amount of future debt issues. The construction of a second water supply line serving the City of Baytown is funded partially from non - recurring revenues to reduce the amount of debt that is issued. This project will provide reliability to BAWA's largest customer, the City of Baytown, which currently constitutes 89% of BAWA's water sales. BAWA was approved for and is closing on a loan with the Texas Water Development Board (TWBD) for funding of the second water supply line and Phase H improvements. The loan received from the TWDB Drinking Water State Revolving fund will have 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, 2006 for untreated water purchased from the City of Houston. The rate increased 3.6% from $0.398 to $0.4123 per 1,000 gallons. The previous rate increase was in 2005. Also, another 3.6% increase in the cost of raw water from the City of Houston is anticipated effective April 1, 2007 and is included in the proposed budget. Revenue estimates for water sales in the proposed 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. The proposed budget includes a 50.13 per 1,000 gallon rate increase for BAWA's customers to adjust for the two untreated water rate increases and debt associated with the construction of the new water supply line. Rates will be adjusted in future budget processes to reflect funding needs based on actual debt issued during the previous year. This will allow the rate increase to coincide closely with the AM actual construction. It will also provide for time contingencies that may be required due to the 2 Avok AIW complexity of the project that may extend the construction time of the project. Rate increases will be based on actual construction progress. In the 2005 -06 City budget, the City of Baytown water and sewer fund pays for the cost to tie into the new BAWA line and pay for their portion of the project. 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 must begin 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 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. The current and planned major improvements at BAWA were designed to provide the foundation for growth in sales and continued reliable service to the customers served. I look forward to reviewing this document with you in detail. Sincerely, Gary Ja, General MAJOR BUDGET ISSUES Fiscal Year 2006 -07 AP" 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 89% 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 2006 -07 proposed budget estimates sales of $6,169,400 for 12.5 million gallons per day (MGD) based upon average rainfall in recent years. Fluctuations to average rainfall can significantly impact actual sales. A $0.13 rate increase is projected in the proposed 2006 -07 budget. The 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 are proposed to increase to $1.39 and $1.42, respectively, to cover the increased cost of operations. This increase in rates is expected to generate additional revenue in the amount of $575,740. Since the inception of the BAWA plant in April 1981, there have been rate increases in 1988, 1993 and 1999. EXPENDITURES Total operating expenditures for the proposed 2006 -07 budget are $4,592,549, an increase of $312,502 from 2005 -06. The depreciation expense increased to recognize one full year of depreciation on the new improvements. The proposed 2006 -07 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 costs $ 12,338 • Increase in supplies (Primarily raw water rate increase) 101,683 • Decrease in maintenance (1,000) • Increase in services (Primarily electric rate increases) 199,481 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 3.6% rate increase from $0.398 to $0.4123 effective April 1, 2006. 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 proposed 2006 -07 budget is $2,191,281. There is an increase of $601,861 from the 2005 -06 fiscal year to the 2006 -07 fiscal year for debt issued in June 2006 through a loan from the Texas Water Development Board AP'k (TWDB) for the new water supply line project. 4 APk MAJOR BUDGET ISSUES Fiscal Year 2006 -07 CAPITAL IMPROVEMENT PROGRAM The Capital Improvement Program for BAWA is funded primarily from bonds. The proposed 2006- 07 budget includes funding from retained earnings designated for capital improvements for the second water supply line project. The retained earnings of the BAWA CEP Fund is estimated to be $75,426 by the end of the 2006 -07. Utilizing non - operating funds in the CEP 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. The TWDB loan includes $3,842,547 for this project. Final costs will be developed after TCEQ's 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. • Phase III of BAWA's plant improvement is substantially complete. This included the replacement of equipment that has reached its useful life; pumping improvements to achieve a firm capacity of 26 MGD; and safety improvements. Phase III began in the summer of 2002. Release of retainage is contingent on the contractor's completion of punch list items. • 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 will be partially funded from non - recurring revenues to reduce the amount of debt that is issued. TWDB debt has been issued for construction. The total estimated cost is $10,263,428 for the BAWA line with $1,000,000 proposed to be funded by the City of Baytown for extending their lines. 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, accounts receivable) less current liabilities (e.g. accounts payable). The working capital in the proposed budget is estimated to be 60 days as of September 2007. Working capital in excess of the targeted goal provides contingency funding for current projects and unforeseen expenses. 5 BAYTOWN AREA WATER AUTHORITY FUND 510 BUDGET SUMMARY BY FUND Actual Budget Estimated Base Proposed 2004 -05 2005 -06 2005 -06 2006 -07 2006 -07 Revenues 862,517 912,622 914,388 924,960 924,960 Sale of Water - Baytown $ 5,062,604 $ 4,978,418 $ 4,924,500 $ 4,956,700 $ 5,468,200 Sale of Water - Other 679,101 788,674 619,700 636,960 701,200 Interest Revenue 37,579 26.400 80,320 72,000 72,000 Mineral Royalties 271,574 240,000 173,500 144,000 144,000 Miscellaneous 9,501 - 17,237 5,000 5,000 Transfer From Water & Sewer Fund 68,000 68,000 68,000 68,000 68,000 Total Revenues 6,128,359 6,101,492 5,883,257 5,882,660 6,458,400 Expenditures Personnel Services 862,517 912,622 914,388 924,960 924,960 Supplies 2,384,853 2,559,179 2,450,045 2,660,862 2,660,862 Maintenance 175,044 178,500 219,450 177,500 177,500 Services 439,166 629,746 738,837 829,227 829.227 Total Operating 3,861,580 4,280,047 4,322,720 4,592,549 4,592,549 Capital Outlay 65,537 15,000 14,650 - - Transfers Out - Debt Service 1,305,812 1,589,420 1,319,190 2,191,281 2,191,281 Transfers Out - General Fund - 6,000 3,050 50,000 50,000 Transfers Out - Capital Improvement 271,574 400,000 333,500 - - Contingency - 40,000 - 40,000 40,000 Total Expenditures 5,504,503 6,330,467 5,993,110 6,873,830 6,873,830 Excess (Deficit) Revenues Over Expenditures Working Capital - Beginning Debt Service Reserve Working Capital - Ending No. of Working Capital Days 623,856 (228,975) (109,853) (991,170) (415,430) 1,185,005 2,019.774 1,808,861 1,550,008 1,550,008 (149,000) (149,000) - $ 1,808,861 $ 1,641.799 $ 1,550,008 $ 558,838 $ 1,134,578 120 95 6 94 30 60 Aft Awk BAYTOWN AREA WATER AUTHORITY FUND 510 OPERATING RESULTS Actual Budget Estimated Base Proposed 2004 -05 2005 -06 2005 -06 2006 -07 2006 -07 Operating Revenues Sale of Water - Baytown $ 5,062,604 $ 4,978,418 $ 4,924,500 $ 4,956,700 $ 5,468,200 Sale of Water - Other 679,101 788,674 619,700 636,960 701,200 Sale of Property 9,501 - 17,237 5,000 5,000 Transfer From Water & Sewer Fund 68,000 68,000 68,000 68,000 68,000 Total Revenues 5,819,206 5,835,092 5,629,437 5,666,660 6,242,400 Operating Expenses Personnel Services 862,517 912,622 914,388 924,960 924,960 Raw Water Purchases 1,928,956 1,918,484 1,820,000 1,991,572 1,991,572 Supplies 455,897 640,695 630,045 669,290 669,290 Maintenance 175,044 178,500 219,450 177,500 177,500 Services 439,166 669,746 738,837 869,227 869,227 Depreciation 576,605 480,000 605,591 635,000 635,000 Transfers Out - General Fund - 6,000 3,050 50,000 50,000 Total Expenditures 4,438,185 4,806,047 4,931,361 5,317,549 5,317,549 Operating Income 1,381,021 1,029,045 698,076 349,111 924,851 Non - Operating Interest Revenue and Other 309,153 266,400 253,820 216,000 216,000 Interest Expenses and Other (708,930) (689,190) (689,190) (936,281) (936,281) Transfers Out - Capital Improvement (271,574) (400,000) (333,500) - Total Non - Operating Expenses (671,351) (822,790) (768,870) (720,281) (720,281) Net Income $ 709,670 $ 206,255 $ (70,794) $ (371,170) $ 204,570 Reconciliation of Net Income (Loss) to Revenues Over (Under) Expenses: Net Income $ 709,670 $ 206,255 $ (70,794) $ (371,170) $ 204,570 Principal Debt Retirement (596,882) (900,230) (630,000) (1,255,000) (1,255,000) Capital Outlay (65,537) (15,000) (14,650) - - Depreciation 576,605 480,000 605,591 635,000 635,000 Revenues Over (Under) Expenditures $ 623,856 $ (228,975) $ (109,853) $ (991,170) $ (415,430) 7 f BAWA - CAPITAL IMPROVEMENT PROGRAM FUND 518 BUDGET SUMMARY BY FUND Actual Budget Estimated Base Proposed 2004 -05 2005 -06 2005 -06 2006 -07 2006 -07 Revenues Transfer From BAWA $ 271,574 $ 240,000 $ 333,500 $ - $ - Interest Revenue 50,601 24,000 81,000 75,000 75,000 Total Revenues 322,175 264,000 414,500 75,000 75,000 Expenditures BAWA Capital Improvement Program 330,585 1,198,000 132,959 2,027,000 2,027,000 Total Expenditures 330,585 1,198,000 132,959 2,027,000 2,027,000 Excess (Deficit) Revenues Over Expenditures Retained Earnings - Beginning Retained Earnings - Ending (8,410) (934,000) 281,541 (1,952,000) (1,952,000) 1,754,295 1,198,201 1,745,885 2,027,426 2,027,426 $ 1,745,885 $ 264,201 $ 2,027,426 $ 75,426 $ 75,426 8 La AIRL 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 12.50 MGD in fiscal year 2006 -2007 and a certified bacteriological laboratory, which currently serves 8 customers with the City of Baytown using 88% of production. Following and complying 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. Providing 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. • 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 12.50 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 Workload Measures 2004 -05 2005 -06 2005 -06 2006 -07 1. Customer Connections 8 8 8 8 2. Average MGD of water produced 12.45 12.50 12.5 12.5 3. Customer Service calls 12 10 10 10 Performance Measures 1. Days without interruption of service 365 365 365 365 2. Days finished water <0.1 NTU 365 365 365 365 3. Customer Service Calls Investigated 12 10 10 10 4. Days above 12.50 MGD 253 200 200 220 9 CITY OF BAYTOWN SERVICE LEVEL BUDGET 40M F30-70 BAYTOWN AREA WATER AUTHORITY Actual Budget Estimated Base Proposed Acct# Acct Description 2004 -05 2005 -06 2005 -06 2006 -07 2006 -07 7100 Personnel Services 71031 Contract Personnel Services $ 862,517 $ 912,622 $ 914,388 $ 924,960 $ 924,960 Total Personnel Services 862,517 912,622 914,388 924,960 924,960 7200 Supplies 72001 Office 2,439 4,000 4,000 4,000 4,000 72002 Postage 350 400 350 400 400 72007 Wearing Apparel 4,701 4,700 3,000 4,700 4,700 72016 Motor Vehicle 5,164 19,000 11,000 19,000 19,000 72021 Minor Tools 2,529 1,800 1,500 1,800 1,800 72026 Cleaning & Janitorial 1,573 2,000 1,500 2,000 2,000 72031 Chemical 418,414 576,895 576,895 601,740 601,740 72032 Medical 215 600 500 600 600 72041 Educational 888 1,300 1,300 1,300 1,300 72051 Untreated Water 1,928,956 1,918,484 1,820,000 1,991,572 1,991,572 72055 Laboratory Supplies 19,624 30,000 30,000 33,750 33,750 Total Supplies 2,384,853 2,559,179 2,450,045 2,660,862 2,660,862 7300 Maintenance 73011 Buildings 1,793 3,000 3,500 3,000 3,000 73021 Filtration Plants 35,506 20,000 15,000 20,000 20,000 73022 Sanitary Sewers - - - - - 73025 Streets Sidewalks & Curbs 399 500 700 500 500 73027 Heating & Cooling System 4,867 8,000 10,000 8,000 8,000 73028 Electrical Maintenance 36,328 58,000 58,000 58,000 58,000 73041 Furniture & Fixtures 955 1,000 500 1,000 1,000 73042 Machinery & Equipment 89,254 80,000 130,000 80,000 80,000 73043 Motor Vehicles 5,942 7,500 1,500 6,500 6,500 73045 Radio & Testing Equipment - 500 250 500 500 Total Maintenance 175,044 178,500 219,450 177,500 177,500 7400 Services 74001 Communication 3,371 360 250 3,540 3,540 74002 Electric Service 357,337 510,813 645,000 709,500 709,500 74011 Hire Of Equipment 8,855 10,000 8,500 12,400 12,400 74021 Special Services 20,973 48,850 28,850 65,370 65,370 74022 Audits 4,478 4,657 4,657 4,843 4,843 74036 Advertising 262 500 700 700 700 74041 Travel & Reimbursables 1,533 4,000 4,000 4,000 4,000 74042 Education & Training 8,822 12,000 12,000 12,325 12,325 74051 Rents 5,726 6,000 6,000 - - 74071 Association Dues 638 800 800 800 800 74210 General Liability Insurance 5,047 5,552 5,200 2,573 2,573 74220 Errors & Omissions 7,118 7,830 7,300 3,597 3,597 74240 Auto Liability 597 755 665 525 525 74242 Auto Catastrophic 27 30 30 22 22 74271 Mobile Equipment 322 355 335 224 224 74272 Real & Personal Property 14,060 17.163 14,550 8,727 8,727 74280 Bonds - 81 - 81 81 10 CITY OF BAYTOWN SERVICE LEVEL BUDGET Odw 3070 BAYTOWN AREA WATER AUTHORITY Actual Budget Estimated Base Proposed Acct# Acct Description 2004 -05 2005 -06 2005 -06 2006 -07 2006 -07 Total Services 439,100 OLy, l4U 1.38,0j i 047,4z r _047_,_ 1- Total Operating 3,861,580 4,280,047 4,322,720 4,592,549 4,592,549 8000 Capital Outlay 80001 Furniture & Equip.< $5,000 1,567 - - - - 83031 Fences - - - - 84042 Machinery & Equipment 63,970 - - - - 84043 Motor Vehicles - 15,000 14,650 - - Total Capital Outlay 65,537 15,000 14,650 - - 9000 Other Financing Uses 91101 To General Fund - 6,000 3,050 50,000 50,000 91511 To BAWA Debt Service 1,305,812 1,589,420 1,319,190 2,191,281 2,191,281 91518 To BAWA Capital Improv 271,574 400,000 333,500 - - TotalOtherFinancingUses 1,577,386 1,995,420 1,655,740 2,241,281 2,241,281 9900 Contingencies 99001 Contingencies - 40,000 - 40,000 40,000 Total Contingencies - 40,000 - 40,000 40,000 TOTAL DEPARTMENT $ 5,504,503 $ 6,330,467 $5,993,110 $6,873,830 $ 6,873,830 CITY OF BAYTOWN BAYTOWN AREA WATER AUTHORITY REVENUE BONDS dow LONG TERM DEBT AMORTIZATION SCHEDULES* /k Amount Requirements Amount Revenue Amount of Outstanding Fiscal Year 2006 -07 Outstanding Bonds Issue October, 2006 Principal Interest Total Se t., 2007 Series, 1997 $ 1,350,000 $ 500,000 $ 245,000 $ 23,255 $ 268,255 $ 255,000 Series, 1999 9,095,000 8,425,000 245,000 459,245 704,245 8,180,000 Series, 2002 3,800,000 3,330,000 170,000 170,699 340,699 3,160,000 Series, 2006 13,290,000 - 595,000 283,082 878,082 12,695,000 $ 12,255,000 $ 1,255,000 $ 936,281 $ 2,191,281 $ 24,290,000 Combined BAWA Debt, All Series Debt Requirements to Maturity Fiscal Principal Total Total Year 5101 Interest Requirement I 2007 $ w 1,255,000 $ 936,281 $ 2,191,281 2008 1,230,000 964,709 2,194,709 2009 1,280,000 912,349 2,192,349 2010 1,330,000 858,129 2,188,129 2011 1,380,000 805,504 2,185,504 2012 1,440,000 750,149 2,190,149 2013 1,495,000 692,906 2,187,906 2014 1,555,000 632,016 2,187,016 2015 1,615,000 566,896 2,181,896 2016 1,690,000 498,109 2,188,109 2017 1,755,000 425,189 2,180,189 2018 1,835,000 348,876 2,183,876 2019 1,915,000 267,336 2,182,336 2020 1,030,000 180,658 1,210,658 2021 735,000 143,588 878,588 2022 755,OOD 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 $ 25,545,000 $ 9,360,841 $ 34,905,841 Combined BAWA Debt, All Series Olnteresc Debt Requirement to Maturity 2.500 ■Principal 2.000 1.500 1.000 <C �5 0.500 0.000 - -+ pti' za� Fiscal Year 12 Apk CITY OF BAYTOWN BAYTOWN AREA WATER AUTHORITY REVENUE BONDS DETAIL DEBT AMORTIZATION SCHEDULES Fiscal Interest Principal Interest Interest Annual Principal Total Year Rate Due 5101 Due 5101 Due 11/01 Requirement Outstanding Outstanding 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 1,350,000 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 13 AM CITY OF BAYTOWN BAYTOWN AREA WATER AUTHORITY REVENUE BONDS DETAIL DEBT AMORTIZATION SCHEDULES I Fiscal Interest Principal- Interest Interest Annual Principal Total Year Rate Due 5101 Due 5101 Due 11 /01 Requirement Outstanding Outstandine Revenue Bond, Series 2002 Date of Issue - January 10 2002 180,000 80,674 Term - 19 Years 341,349 2,980,000 4,045,836 2009 5.500% 190,000 75,724 $ 6,040,949 2002 2,790,000 $ - $ 81,895 $ - $ 81,895 $ 3,800,000 5,959,054 2003 2,595,000 - 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 5.500% 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 - - 2022 2.950% $ 3,800,000 $ 1,161,422 $ 1,079,527 $ 6,040,949 3,250,000 3,505,875 Revenue Bond, Series 2006 Date of Issue - June 14, 2006 775,000 Term - 20 Years 50,000 875,000 2,475,000 2,630,875 2024 3.050% 800,000 $ 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 14 AMk Amh City of Houston Untreated Water Rates Year Rate Rate 04/81 .22142 $0.97 COB 02/83 .24157 1985 - 1987 10/86 .25123 10/87 .28022 $0.10 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 07/89 .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 Baytown Area Water Authority Treated Water Rates Year Rate Increase Amount Comments 1981 $0.97 COB 1985 - 1987 $0.97 COB, $1.00 Other 1988- 1992 $1.07 COB, $1.10 Other $0.10 Result of rising operating cost. (Raw water rates up 25 %) 1993- 1998 $1.18 COB, $1.21 Other $0.11 Result of increase in raw water rates. 1999- 2006 $1.26 COB, $1.29 Other $0.08 Funding for plant expansion debt 2007 (Est.) 1$1.39 COB, $1.42 Other 1 $0.13 ICity Funding for new water line debt and of Houston rate increase. 2008 (Est.) 1$1.46 COB, $1.49 Other 1 $0.07 lFunding for disinfection imps debt 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. 2006, rates will be adjusted upward by 3.6° %. By law, water rates are now adjusted each year based upon the actual increase in costs in the region. These new rates will be reflected on your April 2006 billing which you will receive in May. NEW RATES AND CHARGES Classification Rate Contract Treated Water P x $1.436 plus (P -M) x $.557 Untreated Water Rates where there is no contract First 10,000,000 gallons $1.031 per 1,000 gallons Next 10,000,000 gallons $0.927 er 1,000 gallons Next 30,000,000 gallons $0.874 per 1,000 gallons Next 100,000 000 gallons $0.822 per 1,000 gallons Excess of 150 000,000 gallons $0,795 per 1,000 gallons Untreated Water Rates under written contracts $0.4123 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: http: / /www.houstontx.gov /codes/ (Sections 47 -61 and 47 -84 et seq.) Please contact Maria Carrillo at Utility Customer Service at (713) 371 -1072 with specific questions about your bill 16