[00:00:02]
UM, GOOD AFTERNOON[ BAYTOWN AREA WATER AUTHORITY NOTICE OF MEETING BAYTOWN AREA WATER AUTHORITY SPECIAL MEETING WEDNESDAY, FEBRUARY 25, 2026 5:00 P.M. COUNCIL CHAMBER, CITY HALL 2401 MARKET STREET, BAYTOWN, TEXAS 77520 AGENDA CALL TO ORDER AND ANNOUNCEMENT OF QUORUM ]
EVERYONE.WELCOME TO THIS MEETING OF THE BAYTOWN AREA WATER AUTHORITY.
I WOULD LIKE TO CALL THE MEETING TO ORDER AND ANNOUNCE THAT WE DO HAVE A QUORUM.
OUR FIRST ITEM OF BUSINESS WOULD BE CITIZEN COMMENTS.
DO WE HAVE ANY CITIZENS DESIRING TO SPEAK? NO.
SEEING AS THERE ARE NO CITIZENS SIGNED UP, WE WILL MOVE TO THE
[2. MINUTES]
MINUTES AND CONSIDER APPROVING THE MINUTES OF THE AUTHORITY.SPECIAL MEETING HELD ON DECEMBER THE 10TH, 2025.
DO I HAVE A MOTION? I WAS ABSENT THAT DAY.
WELL THEN I GUESS I'LL MAKE THE MOTION.
I HAVE A MOTION AND I NEED A SECOND.
AND, UH, IS THERE QUESTIONS? ARE THERE QUESTIONS OR DISCUSSION? HEARING NONE.
UH, NEXT WE WILL CONSIDER APPROVING THE MINUTES OF THE AUTHORITIES REGULAR MEETING HELD ON JANUARY THE 21ST.
AND SECOND, DO WE HAVE QUESTIONS? DISCUSSION, HEARING NONE.
UM, WE'LL MOVE TO THE REPORT SECTION AND RECEIVE A REPORT ON THE STATUS OF THE AUTHORITIES EAST EXPANSION PROJECT.
[a. Consider a resolution authorizing a professional services agreement for construction materials testing services with Terracon Consultants, Inc. for the Baytown Area Water Authority East Surface Water Treatment Plant Phase 2 Expansion Project.]
RESOLUTIONS.UM, WE WILL CONSIDER A RESOLUTION AUTHORIZING A PROFESSIONAL SERVICES AGREEMENT FOR CONSTRUCTION MATERIALS TESTING SERVICES WITH TERRACON CONSULTANTS INC.
FOR THE AUTHORITIES EUR WATER TREATMENT PLANT PHASE TWO EXPANSION PROJECT.
UM, AS STATED, THE ITEM BEFORE YOU GUYS IS THE, UM, CONTRACT FOR MATERIALS TESTING WITH THE TERRACON CONSULTANTS INC.
UM, THIS ITEM IS FOR THE, UH, MATERIALS TESTING FOR BALL EAST CONSTRUCTION.
SO AS THE CONTRACTOR, UM, PERFORMS THEIR WORK AND, UM, TESTING IS NEEDED, THE TESTING WILL BE OUTSIDE OF THE CONTRACTOR'S CONTRACT AND WE WILL BE MANAGING THAT CONTRACT, UM, AS IN-HOUSE.
UM, BUT THAT BEING SAID, STAFF RECOMMENDS APPROVAL.
DO I HAVE A MOTION? MOVED? SECOND.
SO THIS IS NOT INCLUDED, THIS IS NOT INCLUDED IN OUR CONTRACT FOR CONSTRUCTION.
THAT'S WHAT YOU SAID, RIGHT? CORRECT.
IT'S NOT INCLUDED WITH THE DESIGN BUILD CONTRACT.
AND WHAT IS IT EXACTLY THAT THEY DO? THEY'RE, THEY'RE DOING MATERIALS TESTING.
SO AS THE STRUCTURES ARE, ARE BEING BUILT, UM, CERTAIN, UM, THINGS ARE REQUIRED TO BE TESTED BEFORE, YOU KNOW, IT COULD BE SIGNED OFF ON.
UM, AND SO THAT THIS IS A THIRD PARTY, UM, THAT WOULD PERFORM THAT TESTING.
AND IS IS A THIRD PARTY REQUIRED? YEAH.
COMMUNITY MEMBERS, UH, RAFA URI, ASSISTANT DIRECTOR OF PUBLIC WORKS AND ENGINEERING, CIP UH, IT'S REQUIRED BY STATE LAW? YES.
SO IT'S NOT INCLUDED IN THE CONTRACT FOR MANY REASONS.
ONE OF THEM BEING THAT THERE'S NO, UH, ISSUES WITH IT INTERMINGLING WITH THE CONTRACTOR.
SO WE GOTTA CHECK AND BALANCE THAT CONTRACT.
SO, AND I GUESS WE'VE, WE'VE HEARD THEY'RE A REPUTABLE COMPANY, THEY'VE WORKED WITH THEIR PEOPLE, WE KNOW THEY'LL DO A GOOD JOB, CORRECT? YES.
SO THE, THESE, UH, PROFESSIONAL SERVICES THAT WE'RE CONTRACTING WERE, UH, APPLICANTS THAT WE SELECTED THROUGH A RFQ AND WE PUT OUT A GIANT RFQ OUT.
SO, UH, ENGINEERS, ARCHITECTS, UH, GEOTECHNICAL ENGINEERS APPLY FOR THESE, UM, THESE JOBS.
AND SO THIS WAS ONE OF OUR TOP SELECTIONS.
AND I WILL ADD, UM, WE'VE USED THEM ON SEVERAL OTHER CITY PROJECTS, INCLUDING THE ORIGINAL CONSTRUCTION.
UM, THEN I WOULD ASK FOR A VOTE ON THE RESOLUTION.
[b. Consider a resolution awarding the Annual Liquid Sodium Hypochlorite Contract to Brenntag Southwest, Inc.]
CONSIDER A RESOLUTION AWARDING THE ANNUAL LIQUID SODIUM HYPOCHLORITE CONTRACT TO BRENTAG SOUTHWEST.AND PRESIDENT, THE ITEM BEFORE YOU
[00:05:01]
IS FOR A RENEWAL OF OUR CURRENT, UM, CHEMICAL CONTRACT SODIUM HYPOCHLORITE, WHICH IS ALSO BLEACH.UM, IT IS USED AT THE EAST, UH, TREATMENT PLANT FOR DISINFECTION PURPOSES.
UM, THIS CONTRACT IS FOR NO INCREASE FOR THE TERM, SO IT'S A RENEWAL, UM, OF THE ORIGINAL CONTRACT WITH FLAT PRICING.
UM, WITH THAT BEING SAID, STAFF RECOMMENDS APPROVAL.
DO I HAVE A MOTION? A MOTION SECOND.
ALRIGHT, QUESTIONS, DISCUSSION.
HOW IS THIS DELIVERED? IT SAYS BULK.
HOW IS IT DELIVERED? IS THIS A, A LIQUID OR IT'S A LIQUID.
IT, IT, IT'S, IT'S A, UH, A COMMERCIAL BLEACH SO TO SPEAK.
I MEAN THEY JUST BRING IT IN A BIG TRUCK AND WE STORE IT AND USE THAT.
ALRIGHT, ANY OTHER QUESTIONS? ALL RIGHT.
[a. Receive a report on the status of the Baytown Area Water Authority East Expansion Project.]
THE REPORT SECTION AND RECEIVE A REPORT ON THE STATUS OF THE AUTHORITIES EAST EXPANSION PROJECT.SO JUST A FEW THINGS TO TALK TO Y'ALL.
UM, THAT IS NOT THE RIGHT POWERPOINT.
SORRY, I'M NOT GONNA TALK TO Y'ALL ABOUT FISCAL STUFF THERE.
SO JUST A FEW THINGS TO TALK TO Y'ALL, UM, ABOUT TONIGHT.
UM, I KEPT THE PROJECT BUDGET UP HERE BECAUSE I WANTED TO MAKE SURE KINDA EVERYBODY REMEMBERED, YOU KNOW, WHERE WE ARE WITH THE PROJECT AND SPECIFICALLY TALKED TO YOU ABOUT THE PULSE BED CLARIFIER BECAUSE THAT IS SOMETHING YOU'RE GONNA SEE UM, NEXT MONTH.
SO, UM, WE TALKED TO THE BOARD ABOUT THIS BACK IN DECEMBER WHEN WE WERE DOING THE GMP NEGOTIATIONS, BUT AGAIN, I JUST THINK IT'S A GOOD REMINDER 'CAUSE IT'S A LITTLE UNIQUE.
UM, THE PULSE FED CLARIFIER WAS NOT INCLUDED IN THE CONTRACTOR'S CONTRACT.
IT IS SOMETHING THAT Y'ALL ARE GONNA BUY SEPARATELY.
AND THE REASON WE RECOMMENDED THAT IS BECAUSE YOU, YOU HAVE TO SOLE SOURCE THIS.
THIS IS A PROPRIETARY PIECE OF EQUIPMENT YOU ALREADY HAVE ON SITE AND WE'RE BASICALLY DUPLICATING THE CAPACITY OF IT.
SO WE COULD HAVE DONE THAT THROUGH THE CONTRACTOR, BUT IF YOU DID THAT, YOU WOULD'VE HAD A MARKUP AND THERE WAS JUST NO NEED FOR THAT SINCE YOU WERE HAVING TO SOLE SOURCE IT.
SO WE ANTICIPATE THIS IS SAVING Y'ALL ABOUT $200,000 TO BUY IT YOURSELF.
UM, BUT BECAUSE THAT IS A PRETTY UNIQUE SITUATION, UM, YOUR LEGAL IS CURRENTLY WORKING THROUGH THE CONTRACT WITH THAT VENDOR AND YOU SHOULD HAVE THAT ON NEXT MONTH'S BOARD MEETING TO APPROVE.
SO JUST KIND OF WANTED TO KEEP THAT IN FOREFRONT SO THAT WHEN Y'ALL SEE THAT NEXT MONTH, Y'ALL, Y'ALL KNOW WHAT THAT IS.
AND THEN NEXT I WANTED TO TALK TO Y'ALL ABOUT THE SCHEDULE.
SO, UM, COULD I ASK A QUESTION ABOUT THAT PREVIOUS SLIDE? OH YEAH, SURE.
I REALIZED THAT THE MATERIAL TESTING AMOUNT IN THIS WAS PROPOSED.
IT WAS A PROJECT AND PROJECT BUDGET AND IT WAS ROUGHLY, YOU KNOW, ON A PERCENTAGE BASIS.
OUR TERRACON PROPOSAL IS LESS THAN THAT.
DOES THAT MEAN THAT WE'RE GOING TO REALIZE, QUOTE UNQUOTE A SAVINGS OVER THE PROJECTED BUDGET? THAT IS THE ANTICIPATION.
YEAH, UNLESS OF COURSE WE GO IN AND YOU HAVE TESTS THAT FAIL AND WE HAVE TO DO 'EM AGAIN AND SOMETHING CAUSES THAT PRICE TO INCREASE.
SO THIS, SO THIS TOTAL PROJECTED BUDGET OF 78,000 OR 78 MILLION, IT'S NOT GOING UP BY $319,000? NO, NO.
SO THE BIG THING I DID WANNA TALK TO Y'ALL ABOUT TODAY IS THE SCHEDULE.
SO, UM, AGAIN, WHEN I WAS HERE, UH, IN DECEMBER, Y'ALL APPROVED THE THE GMP CONTRACT, BUT WE NOTED THAT THERE WAS THIS ONGOING REVIEW FROM TEXAS WATER DEVELOPMENT BOARD ON THE ENVIRONMENTAL.
AND THE ONE THING AT THAT TIME THAT WAS HOLDING IT UP WAS THEY WANTED US TO GET THIS ADDITIONAL CORE CORRESPONDENCE THAT BASICALLY SAID YOU DIDN'T HAVE TO HAVE A CORE PERMIT.
WE WERE REALLY EXCITED LAST MONTH BECAUSE WE GOT THAT FROM THE CORE AND ACTUALLY PRETTY FAST FROM THE CORE.
AND WE WERE THINKING WE'D GET TWD ENVIRONMENTAL APPROVAL PRETTY SHORTLY AFTER.
UM, UNFORTUNATELY WE STILL DO NOT HAVE THE ENVIRONMENTAL APPROVAL.
WE HAVE TALKED TO THE TWDB ENVIRONMENTAL GROUP.
THEY HAVE CONFIRMED THAT THEY HAVE EVERYTHING THEY NEED.
WE ARE NOT ANTICIPATED TO GET ANY ADDITIONAL COMMENTS OTHER THAN ONE THAT I'LL TELL YOU ABOUT HERE IN A MINUTE.
UM, BUT THAT COMMENT WOULDN'T KEEP Y'ALL FROM GETTING APPROVAL.
THEY ARE JUST PUTTING IT THROUGH THEIR PROCESS RIGHT NOW AND THEY CANNOT GIVE US A DATE AS TO WHEN THAT APPROVAL, YOU KNOW, CAN BE DONE.
UM, I BRING THAT UP 'CAUSE THAT IS, THAT IS VERY POTENTIALLY GONNA HAVE AN EFFECT, YOU KNOW, ON YOUR SCHEDULE.
AS OF RIGHT NOW, WE'VE ONLY BEEN ABLE TO GIVE THE CONTRACTOR A LIMITED NOTICE TO PROCEED BECAUSE THEY CANNOT START CONSTRUCTION, YOU KNOW, WITHOUT THIS.
BUT THEY CAN DO THINGS LIKE GET SUBMITTALS, START THE
[00:10:01]
PROCUREMENT PROCESS.UM, AND THEY HAVE, AND THAT WAS WHAT WE GAVE THEM THROUGH THAT LIMITED NTP.
BUT IF WE FIND OURSELVES GOING TOO MUCH FURTHER DOWN THE LINE WITH THIS, UM, THERE IS SOME POTENTIAL FOR BOTH SCHEDULE SLIPPAGE AND ADDITIONAL COSTS BECAUSE THIS HAS NOT BEEN YET APPROVED.
BUT I JUST WANNA SET EXPECTATIONS THAT THIS IS DEFINITELY A POTENTIAL BECAUSE IT IS, THEY'RE TAKING THEIR TIME ON THIS ENVIRONMENTAL REVIEW, ESPECIALLY GIVEN THAT IT'S A CATEGORY EXCLUSION THAT BASICALLY SAYS THERE'S NO IMPACTS.
YOU KNOW, AND AGAIN, THEY DON'T DISAGREE WITH THAT.
WE'RE JUST GOING THROUGH THEIR PROCESS, YOU KNOW, RIGHT NOW.
SO ALREADY THE SCHEDULE I HAD ON HERE A FEW WEEKS AGO ANTICIPATED IS WE'RE NOT GONNA MEET THAT BECAUSE WE WERE HOPING WE'D HAVE THIS ENVIRONMENTAL APPROVAL BY LAST WEEK AND WE DON'T HAVE IT, YOU KNOW, YET.
SO Y'ALL ARE GOING TO HAVE TWO MEETINGS IN MARCH.
SO I'M GONNA KEEP THIS ON THE FRONT FRONT AND GIVE Y'ALL UPDATES ON THAT.
ONE OF THE REASONS YOU'RE HAVING TWO, UM, MEETINGS IN MARCH GOES BACK TO THAT COMMENT THAT WE KNOW WE'RE GOING TO GET FROM AN THE ENVIRONMENTAL REVIEW.
UM, THEY'RE CALLING IT A SPECIAL CONDITION AND IT BASICALLY SAYS THAT BECAUSE THE MONARCH BUTTERFLY IS POTENTIAL TO BE ON THE THREATENED LIST, YOU CANNOT DO ANY VEGETATIVE CLEARING WITHIN A CERTAIN TIME OF THE YEAR.
AND IF YOU DO HAVE TO DO IT AND THE MONARCH BUTTERFLY BECOMES A THREATENED SPECIES, THEN YOU'LL HAVE TO COORDINATE WITH THE PARKS AND WILDLIFE BOARD.
WE DON'T HAVE AN ISSUE WITH THAT 'CAUSE YOU'RE ACTUALLY NOT CLEARING ANY OF THE SITES, SO IT DOESN'T AFFECT YOU, BUT THEY'RE GOING TO REQUIRE YOU PUT THAT IN THE CONTRACT WITH THE CONTRACTOR.
SO THE NEXT BOARD MEETING, WE JUST DIDN'T GET THE LANGUAGE AND TIME TO GET IT ON THIS AGENDA.
YOU'RE GONNA AMEND, UH, BWP CONTRACT JUST TO ADD IN THAT SPECIAL CONDITION.
SO, UM, THAT'S WHY YOU'RE HAVING ONE OF THE REASONS YOU'RE HAVING A SPECIAL MEETING ON THE 11TH.
WE MAY HAVE THE VLL CONTRACT ON THERE, BUT MORE THAN LIKELY IT'LL BE THE, THE REGULAR MARCH MEETING ON THAT.
SO, LIKE I SAID, I'LL HAVE MORE TO COME AS THIS MOVES ON, BUT, UM, I DID JUST KIND OF WANNA LET THE BOARD KNOW THAT THIS IS A SITUATION, YOU KNOW, WITH THE CONTRACT.
WOULD WE ANTICIPATE THAT IF TWDB DOESN'T GET THE ENVIRONMENTAL REVIEW BACK TO US IN TIME, THAT THE GROUNDBREAKING DATE WOULD SLIP ALSO? UM, I THINK WE'RE ALL HOPING WE'RE STILL GONNA HAVE THAT.
AND ACTUALLY, I, I HAVE THEM MORE SIVAN.
DO YOU REMEMBER THE MORE SPECIFIC DATE FOR THE GROUNDBREAKING? WE JUST GOT THAT.
AS OF RIGHT NOW, NO, BECAUSE I REALLY DO THINK WE'RE GOING TO GET THIS ANY DAY NOW AND WE'LL STILL BE ABLE TO BECAUSE MORE CEREMONY, YOU KNOW, THAN ANYTHING.
SO WE'LL BE ABLE TO HOLD IT, BUT I WON'T KNOW THAT ANSWER UNTIL PROBABLY NEXT MONTH WHEN WE ALRIGHT.
SO IT'S NOT GREAT NEWS AND I'M SORRY FOR THAT, BUT WE ARE TRYING, I CALL TWDB ALMOST EVERY DAY.
SO ANY QUESTIONS ON THAT? ONLY A COMMENT.
OH, NO WORRIES, NO WORRIES THERE.
I KNOW THEM ALL BY FIRST NAME.
THEY, THEY UNDERSTAND THAT WE ARE WAITING FOR THIS.
[b. Receive the Baytown Area Water Authority Quarterly Financial and Investment Reports for the Quarter Ending December 31, 2025.]
NEXT WE WILL RECEIVE THE AUTHORITIES QUARTERLY FINANCIAL AND INVESTMENT REPORTS FOR THE QUARTER ENDING DECEMBER 31ST, 2025.UM, GOOD EVENING BOARD, I'M HERE TO PRESENT THE FIRST QUARTER FINANCIAL REPORT FOR PERIOD ENDING DECEMBER 31ST, 2025.
UM, OUR REVENUES ARE ON PAR WITH, UM, WHERE WE ARE RIGHT NOW, WHICH WOULD BE 25%.
WE'RE AT 27 WITH 5.9 MILLION IN REVENUE.
UM, OUR EXPENDITURES ARE, UM, 10.8 MILLION, BUT THAT IS, AND IT'S AT 47%, BUT THAT IS DUE TO, WE HAVE, UM, 6.8 MILLION IN COMMITTED FUNDS OR ENCUMBRANCES, UM, IN THAT EXPENDITURE LINE ITEM.
AND SO THAT'S WHAT, UH, IS CAUSING THAT TO BE 40 PER 47% AT THIS TIME.
BUT THAT IS LEAVING US WITH A ENDING WORKING CAPITAL OF 5 MILLION.
UM, FOR OUR CIP PROGRAM, WE HAVE FIVE HUNDRED AND TWENTY ONE TWENTY 9,000 IN REVENUE AND WE HAVE, UM, 410,000 IN EXPENDITURES LEAVING US WITH A WORKING CAPITAL BALANCE OF 6.4 MILLION.
OUR, UM, TAX POOL INVESTMENT BOOK VALUE RIGHT NOW IS 27 MILLION AND FOR THIS YEAR WE'VE EARNED 290,000 FOR THIS QUARTER.
AND I'M HAPPY TO ANSWER ANY QUESTIONS IF YOU HAVE ANY.
THE, UH, CHANGE FOR THE, FOR THE FIRST QUARTER IN OUR TAX POOL INVESTMENTS IS A, IS A DECREASE OF 1,000,009
[00:15:02]
THAT WENT TO FUND OPERATING EXPENSES OR IS THAT A TRUE MARKET DECLINE? WHEN YOU SAY A CHANGE, I'M SORRY, THIS IS A CHANGE, THIS IS WHERE WE ARE FOR THIS YEAR, I UNDERSTAND THAT, BUT WHAT IS THAT MILLION NINE? IS THAT MONEY THAT WE PULLED OUT OF TEXT POOL AND SPENT ON SOMETHING OR IS THAT A DECLINE IN THE VALUE OF THE TEXT POOL INVESTMENT? WELL, IF WE'RE SPENDING, THE EXPENDITURES IS BASED ON HOW MUCH WE'RE SPENDING.SO WHATEVER WE HAVE IN THAT TEXTBOOK ACCOUNT IS WHAT WE'RE EARNING THE INVESTMENT.
SO WE'VE BEEN SPENDING, UM, AS YOU CAN SEE, WE'VE SPENT, UH, OR WE'VE COMMITTED ABOUT 10 MILLION.
SO WHAT WE HAVE IN OUR INVESTMENT POOL IS WHAT, WHAT GENERATES THE INCOME? SO WE HAVEN'T REDUCED ANYTHING.
IT'S, WE'VE BEEN SPENDING MONEY OUT OF THAT ACCOUNT.
I, I'M HAVING A LITTLE PROBLEM WITH THE MATH.
IF WE HAVE EXPENDED $11 MILLION AND $6 MILLION OF THAT IS ENCUMBERED MM-HMM
THAT MEANS WE'VE ONLY SPENT $5 MILLION.
WE'VE HAD REVENUE OF 5 MILLION, $6 MILLION MM-HMM
SO WHY HAS OUR INVESTMENT ACCOUNT DECREASED BY ALMOST $2 MILLION RATHER THAN HAVING INCREASED BY A MILLION? BUT OUR INVESTMENTS RIGHT NOW IS ONLY 3.5300000000000002%.
WE WERE UP TO FIVE POINT SOMETHING PERCENT PREVIOUSLY.
SO WE ALSO HAVE TO TAKE INTO ACCOUNT THE INVESTMENT, UM, THE INVESTMENT INTEREST PERCENTAGE FOR THE INVESTMENT.
SO WE ARE AT 3.83 THIS RIGHT NOW.
AND BEFORE IT WAS AROUND THREE POINT, IT WAS AROUND 5.13 AT ONE POINT.
SO THIS IS A MARKET, SO IT FLUCTUATES.
THIS IS A TRUE MARKET DECLINE.
ALRIGHT, DOES ANYONE ELSE HAVE HAVE A QUESTION? ALL RIGHT, THANK YOU.
[c. Receive the Baytown Area Water Authority Investment Policy.]
THE AUTHORITIES INVESTMENT POLICY.SO, UM, THE INVESTMENT POLICY PURSUANT TO, UM, THE TEXAS GOVERNMENT CODE WITH CHAPTER 2256, WE HAVE TO PRESENT OUR INVESTMENT POLICY TO THE BOARDS AND THE GOVERNING BODY BASED ON THE PFIA.
AND SO WE, UM, IN THE PAST, I THINK IN THE PREVIOUS YEARS, WE HAVEN'T PRESENTED IT TO THE BORROWER BOARD.
SO WE'RE TRYING TO GET IN COMPLIANCE WITH THAT.
AND WE HAVE, UM, OUR INVESTMENT POLICY RIGHT NOW IS ALIGNS WITH OUR CITY POLICY.
SO THIS IS BASICALLY THE SAME POLICY THAT WE FOLLOW FOR THE CITY.
UM, FOR EACH BOARD WE DO THE SAME POLICY AND WE HAVE HILLTOP SECURITIES ON THE LINE AS OUR CONSULTANT, UM, WHO IS HELPING US, UM, MAKE SURE THAT WE ARE IN COMPLIANCE WITH ALL THE REGULATIONS.
THEY ARE ON THE CALL ALSO TO HELP WITH ANY QUESTIONS THAT YOU MAY HAVE AND IT IS MATT HARRIS AND SCOTT MCINTYRE.
WOULD YOU LIKE ME TO GIVE SOME BASIC BACKGROUND ON THE INVESTMENT POLICY? A COUPLE MINUTES WORTH? I I KNOW YOU GUYS MAY HAVE SOME QUESTIONS ALREADY, BUT, BUT IF NOT, I CAN CAN BRING YOU UP TO SPEED A LITTLE ON THAT.
SO A LOT OF THE INVESTMENT, MOST OF THE INVESTMENT POLICIES THAT YOU'LL SEE IN THE STATE OF TEXAS, INCLUDING THE, THE CITIES AND IN YOUR INVESTMENT POLICY ARE VERY, VERY SIMILAR.
NOBODY REINVENTS THE WHEEL AND THE PUBLIC FUNDS INVESTMENT ACT, WHICH IS, UH, GOVERNMENT CODE 2256, DICTATES WHAT NEEDS TO BE IN THE INVESTMENT POLICIES.
AND THEN LOCAL GOVERNMENTS WILL FILTER THAT DOWN DEPENDING ON HOW CONSERVATIVE THEY ARE.
BUT THERE'S NOTHING THAT WOULD BE IN YOUR POLICY AT ANY GIVEN POINT IN TIME THAT WASN'T AUTHORIZED OR PERMITTED BY A VERY STRICT SET OF RULES AND GUIDELINES, UM, THAT, THAT ARE OUTLINED IN BY THE TEXAS LEGISLATURE.
SO, UM, THE POLICY HASN'T CHANGED VERY MUCH.
IT OUTLINES EVERYTHING FROM THE REPORTING REQUIREMENTS TO THE TYPE OF INVESTMENTS THAT YOU'RE ABLE TO DO, PERMITTED TO DO, ALONG WITH SOME INVESTMENTS THAT YOU ARE PROHIBITED FROM DOING AND, UH, A A NUMBER OF OTHER BASIC THINGS.
BUT I CAN ASSURE YOU THAT WE'VE GONE THROUGH THE POLICY, WE HAD A HAND IN IN WRITING IT YEARS AGO.
UM, WE HAVE GONE THROUGH THE POLICY AND EVERY TIME THE LEGISLATURE MEETS, IF THERE ARE CHANGES WE INCORPORATE THEM IN.
AND TO BE HONEST WITH YOU, THE TEXAS LEGISLATURE, FOR WHATEVER REASON, HAS BEEN PREOCCUPIED WITH OTHER THINGS AND HASN'T CHANGED THE, UH, PUBLIC FUNDS ADVANCEMENT ACT IN IT'S PROBABLY BEEN SIX YEARS, TO BE HONEST WITH YOU, SINCE THEY MADE ANY SIGNIFICANT CHANGES.
SO I, I THINK THERE MAY BE A LETTER INCLUDED THAT SAYS THAT WE'VE READ YOUR POLICY AND WE BELIEVE VERY SOUNDLY THAT, UH, IT IS IN COMPLIANCE WITH TEXAS LAW.
ONE OF THE THINGS THAT WE CAN DO IF YOU'RE
[00:20:01]
INTERESTED IS, IS POLICIES CAN BE SUBMITTED TO A COUPLE OF DIFFERENT ORGANIZATIONS, BUT THERE'S ONE IN TEXAS THAT, THAT BASICALLY IS THE NORTH TEXAS CENTRAL COUNCIL OF GOVERNMENTS.AND THEY WILL GO THROUGH A POLICY AND GIVE IT A AWARD OF DISTINCTION IF IT MEETS ALL OF THEIR CRITERIA.
WE CAN ACTUALLY SEEK THIS OUT IF, IF YOU WOULD LIKE THAT.
IT, IT'S, IT'S AN ASSURANCE AND IT'S ALSO A, A, A KUDO WHENEVER YOU, YOU GET THAT CERTIFICATE.
BUT I FEEL LIKE THE POLICY IS, IS IN GOOD ENOUGH SHAPE THAT IT'S READY TO BE SUBMITTED AT THIS POINT IN TIME.
BUT AGAIN, WE'RE NOT REINVENTING THE WHEEL HERE.
UH, THE POLICY AGAIN IS, IS SAID BEFORE IS, IS THE SAME AS THE CITY OF BAYTOWN AND THE BAY CITY OF BAYTOWN POLICY LOOKS A LOT LIKE THE CITY OF GALVESTON'S POLICY AND THE CITY OF, UH, GOSH, A LOT OF YOUR NEIGHBORS PER LAND.
A A LOT OF FOLKS IN THAT NECK OF THE WOODS, TEXAS CITY.
UM, SO ANYWAY, I, I DON'T KNOW IF THERE'S ANY QUESTIONS OR ANYTHING YOU WANT ME TO GO INTO ANY MORE DETAIL IN.
AND IT IS REQUIRED THAT IT COMES IN FRONT OF THE GOVERNING BODY ONCE A YEAR BASICALLY, UH, BY THE PFIA.
THAT'S ANOTHER ONE OF THE REQUIREMENTS.
AND, AND THAT'S ESSENTIALLY WHAT'S HAPPENING TODAY.
DOES ANYONE HAVE A QUESTION? UH, NO.
YEAH, I HAVE A QUESTION CONCERNING THE, UM, CERTIFICATION PROCESS THAT YOU TALKED ABOUT.
IS THERE A COST INVOLVED IN THAT, UM, IN ORDER TO GET THE BLUE RIBBON? UH, SO I BELIEVE IT'S MAYBE $250.
IT DEPENDS ON YOUR, WHETHER OR NOT YOU'RE A MEMBER OF GTOT AND THEN THE PRICE VARIES A LITTLE BIT.
UM, I WILL BE HAPPY TO CARRY THAT FORWARD AND WE CAN, WE CAN PICK UP THE TAB ON THAT IF YOU'D LIKE US TO PROCEED FORWARD.
YEAH, IT SEEMS TO ME THAT IF THAT'S JUST AN EXTRA SORT OF ICING ON THE CAKE, SO TO SPEAK, THAT THAT WOULD BE A WORTHY ENDEAVOR.
WE WILL MOVE FORWARD ON THAT FOR THE CITY OF BAYTOWN AS WELL AS IS IS YOUR POLICY.
AND WE WILL, UH, MATT AND I WILL GET STARTED ON THAT IF NOT THIS WEEK, EARLY NEXT WEEK.
AND HOPEFULLY YOU'LL HEAR SOMETHING BACK FROM US IN SHORT ORDER.
BUT JUST, UH, JUST TO, UH, SAY, I DON'T THINK THAT BAWA HAS THE ABILITY TO AUTHORIZE FOR YOU TO DO THE CITY OF BAY TOWN'S INVESTMENT JUST TO CLAR, I'M SORRY, JUST TO CLARIFY, THE CITY OF BAYTOWN HAS ALREADY WON THE, UH, DISTINCTION FOR THE INVESTMENT POLICY THAT WE HAVE.
SO THIS SHOULD BE A SLAM DUNK.
AND YOU GUYS WILL HAVE A CERTIFICATE ON YOUR WALL.
SO WE'LL MOVE FORWARD ON THAT.
THANK YOU VERY MUCH FOR JOINING US TODAY.
WELL, YOU GUYS HAVE A GOOD REST OF THE EVENING.
[d. Receive the Baytown Area Water Authority's Annual Financial Report for the fiscal year ended September 30, 2025]
ON THE AGENDA WILL BE TO RECEIVE THE AUTHOR'S ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30TH, 2025.SO WE'RE HERE TO PRESENT THE, UM, ANNUAL AUDIT REPORT FOR FY 25.
WE HAVE, UH, STEVEN SMITH WITH, UH, WEAVER AND TIDWELL HERE TO, UH, DO THE PRESENTATION.
UH, BEFORE I GET STARTED, I, WE WANNA EXPRESS OUR APPRECIATION TO THE CITY'S FINANCE TEAM, UH, FOR ALL THEIR HARD WORK THAT GOES INTO PREPARING FOR THE AUDIT.
UM, SO SET BEFORE YOU, UH, YOU'LL SEE THAT THERE ARE TWO ITEMS. THERE'S A, THERE SHOULD BE A LETTER ADDRESSED TO GOVERNANCE, UH, AS WELL AS THE ANNUAL FINANCIAL REPORT.
IN THE LETTER ADDRESSED IN THE LETTER ADDRESSED TO GOVERNANCE, UH, YOU'LL SEE AN OUTLINE OF OUR RESPONSIBILITIES, UH, RELATED TO THE AUDIT, AS WELL AS A SUMMARY OF SIGNIFICANT RISKS THAT, UH, WERE HELPFUL IN THE PLANNING STAGES FOR DESIGNING OUR PROCEDURES RELATED TO THE AUDIT.
UH, IT ALSO INCLUDES A DESCRIPTION OF WHAT WE HAD, UH, PERFORMED RELATING TO THOSE RISKS AND THAT WE DIDN'T HAVE ANY, UH, IDENTIFIED ANY ISSUES RELATING TO THEM.
UH, NEXT I'LL, UH, POINTING THE ATTENTION TO THE ANNUAL FINANCIAL REPORT, UH, INCLUDED INSIDE, THERE ARE TWO REPORTS FROM OUR FIRM, UH, ONE THAT INCLUDES THE OPINION ON THE, ON THE FINANCIAL STATEMENTS, UH, EXPRESSING THAT WE HAVE A UNMODIFIED OPINION, WHICH IS A CLEAN OPINION, UH, EXPLAINING THAT, UH, THE FINANCIAL STATEMENTS, UH, ARE WITHOUT ANY MATERIAL MISSTATEMENT ARE, ARE FAIRLY PRESENTED.
[00:25:01]
YOU GUYS HEAR ME OKAY? YES.I THINK I'M BATTLING WITH THE MICRON A LITTLE BIT.
UM, THE SECOND REPORT WE ALSO HAD, UM, UH, EXPRESSES THAT THERE WERE NO, UH, SIGNIFICANT DEFICIENCIES OR MATERIAL WEAKNESSES OVER INTERNAL CONTROLS, OVER FINANCIAL REPORTING, UH, AS A OR DURING OUR AUDIT.
UH, NEXT I WAS GONNA HIGHLIGHT A FEW ITEMS AS FAR AS, UH, FROM THE FINANCIAL STATEMENTS THEMSELVES AS FAR AS GIVE A BRIEF HIGHLIGHT.
UH, SO IF, IF YOU WANTED TO FOLLOW ALONG, IT'D BE ON PAGES 12 AND 13.
UM, ON PAGE 12, UH, IT WILL HAVE THE BALANCE SHEET ESSENTIALLY SHOWING THE TOTAL ASSETS AND LIABILITIES FOR THE, THE FISCAL YEAR ENDED.
UH, THE AUTHORITY ENDED THE YEAR WITH 145 MILLION IN ASSETS, WHICH IS LARGELY COMPRISED OF CASH AND, UH, FIXED ASSETS.
YOU'LL SEE THAT, UH, TOTAL ASSETS INCREASED BY ABOUT 1.1 MILLION YEAR OVER YEAR, WHICH WAS LARGELY A RESULT OF, UH, THE OPERATIONS FOR THE YEAR.
UH, WE ENDED THE YEAR WITH 64.8 MILLION, UH, LARGELY COMPRISED OF THE, THE BONDS THAT ARE OUTSTANDING.
THE, IT DECREASED BY ABOUT, UH, 2.9 MILLION, WHICH WAS LARGELY A RESULT OF THE, THE BOND PAYMENTS FOR THE YEAR, UH, ENDING THAT POSITION FOR THE YEAR HAD INCREASED BY ABOUT, UH, ROUGHLY 4 MILLION, UH, ON THE BOTTOM OF THE PAGE.
AND THAT THAT'S DUE TO, UH, CURRENT OPERATIONS, WHICH IS ARE EXPLAINED FURTHER ON THE NEXT PAGE.
UH, TOTAL REVENUES FOR THE YEAR, UH, ABOUT 21 MILLION, WHICH WAS ABOUT, UH, A LITTLE LESS THAN A MILLION INCREASE YEAR OVER YEAR, UH, EXPENSES FOR THE YEAR 16.2 MILLION.
UH, THIS, UH, WHICH WAS LARGELY DUE TO THE RAW WATER PURCHASES INCREASING, UM, OR MORE EXPENSES THERE.
UM, AND THEN AS WE MENTIONED EARLIER, UH, THE $4 MILLION YEAR OVER YEAR INCREASE TO YOUR ENDING THAT POSITION.
UH, WITH THAT, IF THERE'S ANYTHING THAT I MIGHT BE ABLE TO ANSWER OR ANY QUESTIONS OR COMMENTS THAT I MIGHT BE ABLE TO ADDRESS.
DOES ANYONE HAVE ANYTHING? I DON'T HAVE ANY QUESTIONS.
[a. The next Baytown Area Water Authority meeting is scheduled for Wednesday, March 11, 2026, at 5:00 p.m., in the Council Chamber located at City Hall, 2401 Market Street, Baytown, Texas 77520. ]
AS UH, WE HAVE NOW REACHED THE MANAGER'S REPORT.GOOD EVENING EVERYONE, UH, PRESIDENT AND DIRECTORS.
UM, I DON'T HAVE MUCH ELSE TO INCLUDE OTHER THAN THE FACT THAT YOUR NEXT MEETING, UH, IS, UH, SCHEDULED FOR WEDNESDAY, MARCH 11TH AT 5:00 PM HERE IN THE COUNCIL CHAMBERS LOCATED AT CITY HALL.
DO YOU HAVE ANY QUESTIONS? NO QUESTION.
AS, UH, THERE'S NO FURTHER BUSINESS ON OUR AGENDA, I TO ENTERTAIN A MOTION TO ADJOURN.
I SECOND MO MOVED AND SECONDED.