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HomeMy WebLinkAboutResolution - 2006-R0117 - Amendment To Agreement - CRMWA -Project Contruction Costs, Groundwater Supply - 03/08/2006Resolution No. 2006-R0117 March 8, 2006 Item No. 6.8 A RESOLUTION AUTHORIZING THE CITY OF LUBBOCK'S (1) PARTICIPATION IN THE AMOUNT OF PROJECT CONSTRUCTION COSTS FOR THE CANADIAN RIVER MUNICIPAL WATER AUTHORITY; AND (ii) THE APPROVAL AND EXECUTION BY THE MAYOR OF THE CITY OF LUBBOCK OF AN AMENDMENT TO THE CITY'S CONJUNCTIVE USE GROUNDWATER SUPPLY AGREEMENT WITH THE CANADIAN RIVER MUNICIPAL WATER AUTHORITY WHEREAS, the City of Lubbock, Texas (the "City") has entered into that certain Agreement for the Purchase and Acquisition of Conjunctive Use Groundwater Supply (the "Agreement") entered into as of May 15, 1996, as amended, with the Canadian River Municipal Water Authority (the "Authority"); and WHEREAS, the Authority has entered similar agreements with each of the other cities that are members of the Authority (the "Member Cities"); and WHEREAS, the Authority issued its Canadian River Municipal Water Authority Contract Revenue Bonds, Series .1996 (Conjunctive Use Groundwater Project); Canadian River Municipal Water Authority Contract Revenue and Refunding Bonds, Series 1999 (Conjunctive Use Groundwater Project); Canadian River Municipal Water Authority Contract Revenue Bonds, Series 2005 (Conjunctive Use Groundwater Project) and Canadian River Municipal Water Authority Contract Revenue Refunding Bonds, Series 2005 (Conjunctive Use Groundwater Supply Project); and WHEREAS, the Agreement requires certain notice requirements before the Authority may issue Additional Bonds, as defined in the Agreement; and WHEREAS, refunding bonds are Additional Bonds under the Agreement; and WHEREAS, the additional amount needed in Project Construction Costs, exclusive of Financing Costs is $50,000,000; and WHEREAS, the City agrees that the Additional Water Rights should be acquired and the Canadian River Municipal Water Authority Contract Revenue Refunding Bonds, Series 2005 (Conjunctive Use Groundwater Supply Project) should be issued for such purpose. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK, TEXAS: SECTION 1. That the City agrees to the proposed total amount of Project Construction Costs for the Additional Water Rights should not exceed $55,080,000, with the Project Construction Costs, exclusive of Financing Costs, not exceed $50,000,000. SECTION 2. That the Amendment No. 3 to the Conjunctive Use Groundwater Supply Agreement is hereby approved. SECTION 3. That the City Council expressly recognizes that the Exhibit "A" to the Amendment No. 3 to the Conjunctive Use Groundwater Supply Agreement reflects the level of participation for each member City of the Authority as is anticipated by the Authority and that the actual participation may vary. The City Council hereby authorizes the City Manager, and hereby delegates to the City Manager the authority, to substitute a revised Exhibit "A" after all member cities have acted on its respective resolutions. As has been resolved by the City, it is the intent of the City to participate to the maximum extent possible. Therefore, the delegation of authority herein includes the authority to substitute the revised Exhibit "A" containing an allocation to the City of greater than or equal to 37.058%. SECTION 4. That the City Secretary be and is hereby authorized to deliver certified copies of this Resolution and minutes pertaining to its adoption and the Amendment to the Conjunctive Use Groundwater Supply Agreement to the Secretary of the Canadian River Municipal Water Authority in such number as may be requested for said Authority's records and proceedings. PASSED, APPROVED AND ENACTED this the 8th day of March, 2006. ATTEST: City Secretary City of Lubbock, Texas [City Seal] ml/Resolution-CRMWA-Authorizing Participation March 3, 2006 City of Lubbock, Texas 2 Resolution No. 2006-R0117 AMENDMENT NO.3 TO AGREEMENT FOR THE PURCHASE AND ACQUISITION OF CONJUNCTIVE USE GROUNDWATER SUPPLY This Amendment No. 3 to the Agreement Between the Canadian River Municipal Water Authority and the City of Lubbock, Texas (the "Amendment"), entered into to be effective as of February 1, 2006, by and between the Canadian River Municipal Water Authority (the "Authority") and the City of Lubbock (the "City") amends that certain Agreement for the Purchase and Acquisition of Conjunctive Use Groundwater Supply (the "Agreement") entered into as of May 15, 1996, as amended, between the Authority and the City. Capitalized terms used in this Amendment and not otherwise defined shall have the same meanings as set forth in the Agreement. PREAMBLE Pursuant to the Agreement, the Authority and the City, together with the other Member Cities have agreed to provide for the acquisition and financing of a Conjunctive Use Groundwater Supply Project. The Authority has with proceeds of revenue bonds acquired Water Rights to provide for the current needs of the Member Cities. Because additional water rights will be needed in the future, several of the Member Cities have requested the Authority to continue to acquire Additional Water Rights to provide for long term future needs. Because certain of the Member Cities may not need the Additional Water Rights, it is necessary to provide for a mechanism for the Member Cities to allocate the cost of the new water rights among those Member Cities who have expressed a current need to acquire such Additional Water Rights and to provide a mechanism for a Member City that currently does not have a need for such Additional Water Rights to be able to buy - in and obtain such Additional Water Rights at a later date up to its Original Groundwater Share—. The cost of the Additional Water Rights to be approved by this amendment is approximately $50,000,000, and the Authority will issue its Contract Revenue Bonds, Series 2006 (Conjunctive Use Groundwater Supply Project) for such purpose. Financing Costs for such bonds are anticipated to be approximately $1,080,000 if a Surety Policy can be obtained for the Bond Reserve Fund or $5,080,000 if the Bond Reserve Fund must be funded from bond proceeds. Unless approved in writing by the City and each of the other Member Cities, Project Construction Costs for the Contract Revenue Bonds, Series 2006 (Conjunctive Use Groundwater Supply Project) may not exceed $55,080,000 (representing approximately $50,000,000 in project costs and $5,080,000 in Financing Costs). -1- For and in consideration of the premises and the mutual covenants hereinafter contained, and subject to the conditions herein set forth, the Authority and the City hereby amend the Agreement as follows: ARTICLE ONE The declarations, determinations and findings declared, made and found in the preamble to this Amendment No. 3 to the Agreement Between the Authority and the City are hereby adopted, restated and made a part of the operative provisions hereof. ARTICLE TWO The Agreement is hereby amended to add a new Section 2.1.1 to read as follows: 2.1.1 Additional Water Rights means Water Rights acquired for the Project for future use acquired with proceeds from Revenue Bonds issued after December 31, 2005. ARTICLE THREE Section 2.11 of the Agreement is hereby amended in its entirety to read as follows: 2.11 City's Share of Water Supply means the City's share of the water supply from the Project, which prior to the issuance of any Revenue Bonds for the Additional Water Rights is Thirty-seven and 58/1000 percent (37.058%) (the Original Groundwater Share) and such share after such issuance shall be attached as an exhibit to this Agreement as Exhibit "A" and referred to as the City's "Share of Total Groundwater Supply." ARTICLE FOUR Section 2.15 of the Agreement is hereby amended in its entirety to read as follows: 2.15 City's Share of Project Water Supply Costs means the City's portion of the construction cost allocated for the Project Water Supply portion of the Project, based on the City's participation in the Project which shall be attached as an exhibit to this Agreement as Exhibit "A," and incorporated herein. -2- ARTICLE FIVE The Agreement is hereby amended to add a new Section 2.27.1 to read as follows: 2.27.1 Original Groundwater Share means the Project water supply division among the Member Cities prior to the issuance of Revenue Bonds to secure the acquisition of Additional Water Rights and infrastructure related thereto as follows: City of Amarillo 40.621% City of Borger 5.549% City of Brownfield 2.198% City of Lamesa 2.179% City of Levelland 2.790% City of Lubbock 37.058% City of O'Donnell 0.278% City of Pampa 3.600% City of Plainview 3.691% City of Slaton 1.576% City of Tahoka 0.460% ARTICLE SIX Section 2.30 of the Agreement is hereby amended by deleting the last sentence of that section. ARTICLE SEVEN Section 3.1 of the Agreement is hereby amended in its entirety to read as follows: 3.1 Construction Repayment Obligation. In consideration of the share of the Original Groundwater Allocation of the normal water supply from the Project, or a like percentage of any lesser available supply, or such revised share after the issuance of any Revenue Bonds for the acquisition of Additional Water Rights, the City shall pay to the Authority the City's share of Aqueduct Construction Costs and the City's share of Project Water Supply Costs (collectively referred to as "Project Construction Costs"). ARTICLE EIGHT The Agreement is hereby amended to add a new Article 4A to read as follows: ARTICLE 4A. FINANCING FOR THE ACQUISITION OF -3- ADDITIONAL WATER RIGHTS 4A.1 Issuance of Revenue Bonds for Acquisition of Additional Water Rights. (a) For the first series of Revenue Bonds issued under this Agreement after December 31, 2005 for the purpose of acquiring Additional Water Rights, the notice and time provisions of Section 4.1 shall not apply. The Authority shall notify each Member City of the projected Project Construction Costs, the amount of Project Construction Costs that will be included in the proceeds of the Revenue Bonds, the principal amount of Revenue Bonds to be issued. Each Member City shall notify the Authority within thirty (30) days of its intent to participate and the Authority shall calculate each City's Share of Project Construction Costs, based on such participation and shall calculate the new City's Share of Water Supply for each Member City following the acquisition of the Additional Water Rights. The Authority shall provide each Member City with a table showing the Original Groundwater Share and the new City's Share of Water Supply allocation. (b) For any subsequent issue of Revenue Bonds to acquire or provide infrastructure for Additional Water Rights, the notice and time provisions of Section 4.1 will apply. 4A.2 Buy -In. (a) During the original maturity of Revenue Bonds issued under the provisions of Article 4A, a Member City which elects not to participate at the complete level of its Original Groundwater Share shall have the right to exercise an option to buy -in to the Additional Water Rights up to its Original Groundwater Share; provided that such Revenue Bonds remain outstanding, including any refunding bonds issued for refunding such Revenue Bonds. (b) A Member City that did not participate or fully participate in the original issuance of Revenue Bonds for the acquisition of Additional Water Rights is entitled to exercise an option to buy -in to the Additional Water Rights up to the amount of its Original Groundwater Share. Such Member City shall notify the Authority in writing of the amount of its Original Groundwater Share it wants to reclaim and the date that it will make payment for the restoration of all or part of its Original Groundwater Share. The Authority shall provide to all Member Cities notice of such intent to exercise a buy -option, a calculation of the amount of the proposed buy -in and a Revised Exhibit A that will result from the buy -in. (c) A Member City that elects to exercise its option to buy -in me shall pay to the Authority on the closing date for the exercise of the buy -in an amount that would reimburse the original participating Member Cities at a cost that equals the amount of the total debt service that the non- participating Member City would have paid on such Revenue Bonds from the closing date of the Revenue Bonds to the closing date for the exercise of the buy -in option in one lump sum payment. A Member City that exercises a buy -in option shall become obligated and responsible for making its prorata portion of debt service while such Revenue Bonds remain outstanding. (d) Upon receipt of the lump sum payment from the Member City exercising its buy -in option, the Authority shall transmit to each original participating Member City, its prorata portion of the payment within 15 working days of receipt of the buy -in payment. (e) A Member City that did not originally elect to participate may exercise the buy -in option for any amount up to its Original Groundwater Share. (f) When the series of Revenue Bonds used to purchase the Additional Water Rights or refunding bonds issued to refund such series of Revenue Bonds are no longer outstanding, all buy -in options under such Revenue Bonds shall expire and may no longer be exercised. Payment for any such buy -in must be received by the Authority prior to the date such Revenue Bonds or refunding bonds are no longer outstanding. 4A.3 Development of Additional Water Rights. Additional Water Rights will not be developed while Revenue Bonds used to purchase the Additional Water Rights or refunding bonds issued to refund such series of Revenue Bonds are outstanding without the unanimous consent of the Board. ARTICLE NINE This amendment is contingent upon all of the other Member Cities also executing a similar agreement to amend their respective Agreements for the Purchase and Acquisition of Conjunctive Use Groundwater Supply. ARTICLE TEN Save and except as amended by this Amendment, the Agreement and all provisions thereof shall remain in full force and effect in accordance with its terms. IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the dates above written. -5- AUTHORITY: ATTEST: [SEAL] CITY: ATTEST: Nn Reb,6cca Garza, City Secre ry [SEAL] ml/Richard/CRM W A Amendment 3 March 3, 2006 CANADIAN RIVER MUNICIPAL WATER AUTHORITY / By: ` Cl' EXHBIT "A" Revised City Shares of Water Sumly Original Ground- Share of Additional Share of Total Share of Total Water Supply Member City water Allocation Water Rights Groundwater Sunniv All Groundwater and Lake Sunniv Amarillo 40.621% 41.487% 40.857% 38.957% Lubbock 37.058% 37.848% 37.273% 37.166% Borger 5.549% 5.667% 5.581% 5.565% Plainview 3.691% 3.770% 3.713% 3.702% Pampa 3.600% 3.677% 3.621% 5.392% Levelland 2.790% 2.849% 2.806% 2.798% Brownfield 2.198% 2.245% 2.211% 2.204% Lamesa 2.179% 2.179% 2.179% 2.179% Slaton 1.576% - 1.147% 1.361% Tahoka 0.460% - 0.335% 0.397% O'Donnell J 0.278% 0.278% 0.278% 0.278% 100.000% Note: Following buy -in by any city initially participating at less than its Original Groundwater Share in the Additional Water Rights, the Share of Additional Water Rights will be recomputed for all Member Cities by a pro rata reduction of amount by which each Water Rights exceeds it Original Alloction. Thereafter, each city's Share of Total Groundwter Supply and Share of Total Water Supply will be recomputed. Share of Total Groundwater Supply (AF) = (69,000 AF/YR) x (Original Groundwater Allocation) x ($133,500,000) + (Share of Additional Water Rights) x (Amount of Bond Issue) ($133,500,000 + Amount of Bond Issue) Share of Lake Water Supply (AF) = (% Lake Supply from Meredith Supply Agreement) x (69,000 AF/YR) Share of Total Water Supply 0/, __ (Share of Total Groundwater Supply + Share of Lake Supply) pp y ( ) (138,000 AF/YR) Resolution No. 2006-RO117 CERTIFICATE OF CITY SECRETARY THE STATE OF TEXAS § COUNTY OF LUBBOCK § CITY OF LUBBOCK § I, the undersigned City Secretary of said City, hereby certify as follows: 1. That on the ath day of March, 2006, a regular meeting of the City Council of the City of Lubbock, Texas was held at the regular meeting place in the City Council Chambers in City Hall; the duly constituted members of the City Council being as follows: Marc McDougal Mayor Tom Martin Councilmember Floyd Price Councilmember Gary Boren Councilmember James Gilbreath Councilmember Linda DeLeon Councilmember Phyllis Jones Councilmember and all of said persons were present, except for the following: ; thus constituting a quorum. Whereupon, among other business, the following was transacted at said meeting: a written Resolution entitled A RESOLUTION AUTHORIZING THE CITY OF LUBBOCK'S (i) PARTICIPATION IN THE AMOUNT OF PROJECT CONSTRUCTION COSTS FOR THE CANADIAN RIVER MUNICIPAL WATER AUTHORITY; AND (ii) THE APPROVAL AND EXECUTION BY THE MAYOR OF THE CITY OF LUBBOCK OF AN AMENDMENT TO THE CITY'S CONJUNCTIVE USE GROUNDWATER SUPPLY AGREEMENT WITH THE CANADIAN RIVER MUNICIPAL WATER AUTHORITY was duly introduced for consideration of said City Council and read in full. It was then duly moved and seconded that said Resolution be passed; and, after due discussion, said motion, carrying with it the passage of said Resolution, prevailed and carried by the following vote: AYES: NOES: 0 ABSTENTIONS: 2. A true, full and correct copy of the aforesaid Resolution passed at the meeting described in the above and foregoing paragraph is attached to and follows this Certificate; said Resolution has been duly recorded in the official minutes of said City Council; the above and foregoing paragraph is a true, full and correct excerpt from said minutes of said meeting pertaining to the passage of said Resolution; the persons named in the above and foregoing paragraph, at the time of said meeting and the passage of said Resolution, were the duly chosen, qualified and acting officers and members of said City Council as indicated therein; each of said officers and members was duly and sufficiently notified officially and personally in advance, of the time, place and purpose of the aforesaid meeting and that said Resolution would be introduced and considered for passage at said meeting, and each of said members consented in advance to the holding of said meeting for such purpose; and said meeting was open to the public, and public notice of the time, place and purpose of said meeting was given, all as required by Chapter 551, Texas Government Code. . SIGNED AND SEALED this 8th day of March , 2006. [CITY SEAL] ml/Richard/CRMWA-Certificate March 3, 2006 2 Ci Secretary City of Lubbock, Texas Bickerstaff, Heath, Pollan & CaroOM, L.L.P. 816 Congress Avenue Suite 1700 Austin, Texas 78701 (512) 472-8021 Fax (512) 320-5638 www.bickerstaff.com April 14, 2006 Mr. Tom Adams Deputy City Manager City of Lubbock 162513 1h Street Lubbock, Texas 79401 RE: Canadian River Municipal Water Authority Contract Revenue Bonds, Series 2006 (Conjunctive Use Groundwater Supply Project) Dear Tom: Enclosed is a fully executed original of the Amendment No. 3 to Agreement for Purchase and Acquisition of Conjunctive use Groundwater Supply for your files. If you have any questions, please do not hesitate to call. Our toll free number is (800/749-6646). Very truly yours, Thomas M. Pollan TMP:bm enclosure cc: Mr. Kent Satterwhite w/enc. Lubbock Itr to city mgr enc exec ong of amend 3-tmp.wpd Bickerstaff, Heath, Pollan & Caroom, L.L.P. 816 Congress Avenue Suite 1700 Austin, Texas 78701 (512) 472-8021 March 1, 2006 Via Federal Express 806-775-2003 Mr. Tom Adams Deputy City Manager City of Lubbock 162513' Street Lubbock, Texas 79401 Fax (512) 320-5638 www.bickerstaff.com RE: Proposed Canadian River Municipal Water Authority Contract Revenue Bonds, Series 2006 (Conjunctive Use Groundwater Supply Project) Dear Tom: Kent Satterwhite recently contacted you regarding Amendment No. 3 (authorizing issuance of an additional $50 million in bonds for water right acquisition). All CRMWA member cities have been sent a Resolution and Amendment. As we discussed, we are trying to get all Resolutions and Amendments approved as soon as possible in order for the CRMWA Board to approve the Bonds at its April meeting. We are still awaiting confirmation of all member cities of their respective portion of the Additional Water Rights. CRMWA has asked its member cities to consider approving the Resolution and Amendment, as follows: a) The city council of each member city should approve the Resolution, Certificate, and Amendment No. 3 (three originals of the Resolution and Amendment are attached with five Certificates for Resolution). b) When the matter is considered by the city council, it should be explained that minor adjustment in the level of participation may still be made depending upon decisions by some of the other member cities about their own levels of participation. Exhibit A, currently attached to Amendment No. 3, reflects the level of participation for each city that CRMWA anticipates. c) Following city council approval, the city manager should hold the executed documents for up to two weeks while action is taken by other member cities. After action has been taken by all member cities, any necessary adjustment in Exhibit A will be made and a new Exhibit A, reflecting the proper levels of participation, will be substituted. d) Part of the city council's action approving the Resolution, Certificate, and Amendment [step (a), above] should be authorizing the city manager to hold the executed documents and substitute Exhibit A, if necessary. In order to avoid this being a "blank 5 r, Tom Adams March 1, 2006 Page 2 check," some limit on the level of city participation must be established. All this would be reflected and authorized by the minute entry attached to this memorandum. e) Therefore, the motion made at the council meeting to approve the Resolution and Amendment No. 3 should also include directions to the city manager reflected in the attachment. (A separate attachment has been provided for each city; please provide it to the city with its copy of this memorandum.) Then, when minutes of the meeting are prepared, those minutes should reflect the adoption of the Resolution, the approval of Amendment No. 3, and the directions to the city manager (or city secretary, as appropriate). Once the Resolution has been adopted and the participation for each city has been determined, we will send you the final version of Exhibit A to attach. Please keep one original of the Amendment and Resolution and send me two executed originals of the Resolution and Amendment, along with five (5) Certificates for Resolution. A prepaid Federal Express Envelope is enclosed. CRMWA will return an original of the Amendment when the CRMWA Board meets to approve the Amendment and Bonds. As Lubbock has a format for its Resolutions, I am forwarding these documents to you in Word format so that they can be modified as needed. Thank you for your assistance in this matter. Please call me if you have any questions. Our toll-free number is (800) 749-6646. Very truly yours Thomas M. Pollan Enclosures cc: Kent Satterwhite General Manager Canadian River Municipal Water Authority Ms. Jennifer Webster Taffe Vinson & Elkins LLP Trammell Crow Center 2001 Ross Avenue, Suite 3700 Dallas, Texas 75201-2975