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Ordinance No. 14,736 - 3rd Am Water Supply Agrmt CCID #1 ORDINANCE NO. 14,736 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS, AUTHORIZING THE THIRD AMENDMENT TO THE WATER SUPPLY AGREEMENT WITH CHAMBERS COUNTY IMPROVEMENT DISTRICT NO. 1;AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS: Section 1: That the City Council of the City of Baytown hereby authorizes and directs the City Manager to execute and the City Clerk to attest to the Third Amendment to the Water Supply Agreement with Chambers County Improvement District No. 1. Said amendment is attached as Exhibit "A" and incorporated herein 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 27t1' day of May, 2021. R NDON CAPETILL , Mayor ATTEST: �o ads®a•�., a ANGEL JX—ft SON, Interim City ee a�a APPROVED AS TO FORM: � � KAR5N L. HORNER, City Attorney RAKaren HornerlDocumentsTiles\City Couneil\Ordinances12021Way 2713rdAmendment2CCl©l WaterSupplyAgreement.docx Exhibit "A" THIRD AMENDMENT TO THE WATER SUPPLY AGREEMENT BETWEEN THE CITY OF BAYTOWN, TEXAS AND CHAMBERS COUNTY IMPROVEMENT DISTRICT NO. 1 STATE OF TEXAS § COUNTY OF HARRIS § This Third Amendment (the "Third Amendment") to that certain "Water Supply Agreement" between the City of Baytown, Texas, and Chambers County Improvement District No. 1, dated May 23, 2007, is made by and between the same parties on the date hereinafter last specified. WITNESSETH: WHEREAS, the City of Baytown (the "City") and Chambers County Improvement District No. 1 (the "District") did enter into a Water Supply Agreement on May 23, 2007 (tile "Agreement"); and WHEREAS, on January 14, 2011, the parties amended the Agreement to expand the Service Area (the "First Amendment"); and WHEREAS, on November 19, 2020, the parties amended the Agreement to increase the reserved capacity from 500,000 gallons per day average daily flow to 650,000 gallons per day average daily flow; and WHEREAS, the District has requested that the capacity reserved be increased again from 650,000 gallons per day average daily flow to the following over the next three years: Date Average Daily Flow January 1, 2021 650,000 g d January 1, 2022 19300,000 gpd January 1, 2023 1,9505000 gpd January 1, 2024 2,600,000 gpd WHEREAS, the City has considered the request and finds that the increase is reasonable and within its ability to provide; NOW THEREFORE, for and in consideration of the mutual covenants and agreements herein contained, the parties hereto do hereby mutually agree as follows: Third Amendment to the Water Supply Agreement, Page I. Definitions. Unless a different meaning clearly appears from the context, words and phrases as used in this Third Amendment shall have the same meanings as in the Second Amendment, the First Amendment and the Agreement. 2. Amendments. 2.01 Article IV "Quantity and Capacity" of the Agreement is hereby amended to read as follows: ARTICLE IV. QUANTITY AND CAPACITY 4.01 General. Subject to the terns and conditions of this Agreement, City agrees to sell and deliver (or cause to be delivered) to the District, the District's water requirements of treated water, and the District agrees to purchase from City the District's treated water requirements for resale during the term of this contract for water services to be supplied to the Service Area as defined in Article I hereof and amended in the Second Amendment. The District's total treated water requirements shall mean the total quantity of treated water the District needs to conduct operations, use or resell within the Service Area. From and after the effective date of this Third Amendment, the maximum amount of total Water that the City shall be obligated to provide shall be no more than the following: Date Average Daily Flow January 1, 2021 650,000 gpd January 1, 2022 1,300,000 gpd January 1, 2023 1,950,000 gpd January 1, 2024 2,600,000 gpd Any increase in quantity must be approved in writing by the C'ity's Director of Public Works and Engineering but may not exceed 2,600,000 gpd average daily now. 4.02 Adjusted Quantity. It is expressly understood and agreed that the quantity specified in Section 4.01 and the capacity reserved in Section 4.03 shall be adjusted annually starting on July I, 2025, to a quantity that equals 1 10% of the average annual water usage during the previous year; provided that such quantity does not exceed the quantities specified in Section 4.01. However, the Parties agree to endeavor to amend the capacity requirements of this Article to reflect the reasonable needs of the District not to exceed 2,600,000 gpd. 4.03 Capacity Reserved. The City covenants and agrees that the City shall reserve for the benefit of the District the capacity in its water supply facilities and in its treatment plant sufficient to supply and treat the quantities established in Section 4.01 and adjusted in Section 4.02 of this Agreement. However, the District shall not be guaranteed any specific quantity or pressure of Water for the Third Amendment to the Water Supply Agreement, Page 2 services to be provided herein by the City if tile City's Water supply is limited or When tile District's equipment may become inoperative due to unforeseen breakdown or scheduled maintenance and repairs, and the City is ill no case to be held to any liability for failure to furnish any specific amount or pressure of Water. 4.04 Service Contracts with Other Entities. "file District shall not permit any entity located outside the Service Area to connect to the District's System during the term of this Agreement without the express prior written consent Of the City. Failure t0 C011lply With tills prOv1S1O11 Shall C011Stltllte all Event of Default. 4.05 Water for Commercial or Industrial Uses. Tile City and the District aoree that file A`reement is 111111ted to the Supply of potable water. Tile City and tilt'. District ackilowledge and agree that file Agreement 1p 1l0 way hnilts Or prohibits the District from obtainilio untreated water rights or an alternate source Of untreated water supply for resale Of or use Of untreated water within the Service Area for commercial or industrial purposes. 4.06 N/li lllllll111 Quantity. in no event will the quantity specified in Section 4.01 or the capacity specified in Section 4.0 be reduced below the IlllllllllUlll Citlantlty or water system capacity regmrements of the Texas Commission On I:1lvlronmental QLlallt)'as Such 1-egUirements apply to the District. 2.02 Ff'fective the later of(i) the first full billipg cycle occurring, on Or after October 1. 202I, or (ii) the date the City charges rates specified hereinbelow to Chambers County improvement Districts No. 2 alld -3, Section 5.02 "1\'lonthly Service Char,e," Article V "Payment and Ternls" of the Agreement is hereby amended to read as follows: ARTICLE N'. PAYMENT AND TERMS 5.02 Moiltllly Service Charge. The District shall pay to the City in monthly installments a Service charge (to cover the City's Operation and malntepallce) equal to the City's n11t111111im charge and additional charges. if ally, applied to the actual quantity of treated water delivered to the District during the Illollth in question. The charge shall be calculated on the basis of the metered water use foI- each LISCr Connected to the District's system, consistent with the provisions fOr Such calCLllatlon foLInd 111 tilt'. City's Water" Service Rate Ordinance, which may be amended front time to tinle; provided, however, it is expressly Understood and agreed that the amOUnts charged to the District shall be tilt', anlOLitltS charged to customers inside the City multiplied by 1.2 and that Such multiplier shall remain ill effect for purposes of tills Agreement for a period of five years. Tile District a0rees that the payment due herein shall be calculated by using the water delivered as measured by the master meter. Tile plaster meter will be read ill accordance with the Code of Ordinances of the City. Third Amendment to the "later Supply Agrecment, Pave i 2.03 Article \' "Payment and Terms" of the Agreement is hereby amended by adding a new section to be numbered and entitled Section 5.09 "Future Water Supply," which section shall read as follows: ARTICLE V. PAYMENT AND TERMS 5.09 Future Water SLIPVIy. The City and the District acknowledge and agree that ill the event that (i) the District in writing requests from the City additional water capacity beyond the capacity reserved in Section 4.03 and which additional water capacity is necessary to meet the District's future heeds and (11) the City in writing refuses or states that it is unable to supply the requested water capacity within a two-year period of the District's request, the District may construct a water plant or plants for the purpose of supplying such additional water Capacity tllt'011gll the District's System lvltllln the Service Area. in the event the District does build a water plant, the District will continue to purchase water from the City In the aillount lvlllcll has been allocated to tilt' District pursuant to the terms of this Agreenlent. 2.{)4 Section 7.13 "Terns," Article VII "Miscellane011S Provisions" of the Agreement is hereby amended effective the first full billing cycle OCcurring On Or after October 1, 2021. to read as f of lows: .ARTICLE VII. IMISCELLAIEOUS PROVISIONS 7.13 Term. This Aoreenlent shall be in force and effect from the date of' execution hereof by the City for a term Commencing on May 23, 2007 and expiring oil May 22, 2042: provided that the City reserves the right to terminate this agreement if (1) Citv's contract with the Baytown Area Water Authority for the purchase of treated water in sufficient quantities to SLIpply the District under the terills and conditions Ill effect at the time of the execution of this Agreement changes: and (11) the Baytown Area Water Authority's contract with the City of H011St011 for the purchase of raw water in sufficient quantities to supply the Baytown Area Water Authority Under the terms and conditions Ill effect at the tulle Of the eXCCllt1011 Of tills Agreement changes. Should the City's Contract with the Baytown Area Water ALIthorlty or the Baytown Area Water Authority's contract with the City Of HOIIStOil be terminated for any reason or should the City become legally unable to supply the District, then this ;agreement shall telilllnate automatically at the time of such termination or inability. 3. Intel'pl'etat1011. The provisions Of this Third Amendment and the provisions Of the Second Amendment, the First Aillendment and the Agreement should be read together and CO11Strlled as one agreement. provided that, ill the event of ally conflict Or inconsistency Third Amendment t0 the Water Supply Agreement. Page 4 between the provisions of this Third Amendment and the provisions of the Second Amendment, the First Amendment and/or the Agreement, the provisions of this Third Amendment shall control. IN WITNESS WHEREOF, the parties hereto have executed this Amendment in multiple copies, each of which shall be deemed to be an original, but all of which shall constitute but one and the same amendment, this day of , 2021. DISTRICT Chambers County Improvement District No. 1 (Si(ynature) (Date) By: - - (Printed Name) (Title) ATTEST: (Signature) (Printed Name) (Title) CITY City of Baytown, Texas BRANDON CAPETILLO, Mayor (Date) ATTEST: ANGELA JACKSON, Interim City Clerk APPROVED AS TO FORM: KAREN L. HORNER, City Attorney R Karen Horner Documcnts File;ContiacIs kk atct&Wastc�%atct.a2t mint Chambers Counts Iniprowment Di,Irict No 13rdAmendtnent(002)f0041I doc Third Amendment to the Watcr SupplyAgreement, Page 5