18-R-24 - Agreemet with City of Seuin and the SSLGC regarding the sale of excess SSLGC water11"' Mii 19, 011 : ` �,
WHEREAS, the City of Seguin has requested approval from the City of Schertz for the
City of Seguin to enter into a contract(s) with a 3rd party wholesaler for the sale of SSLGC
excess water as is required in the founding documents of the SSLGC; and,
WHEREAS, both Cities and SSLGC have come to agreement that if either City desires to
enter into a contract with a new 3rd party wholesaler for the purchase of excess SSLGC water no
additional approval is necessary and that if a current customer approaches either City to inquire
about purchasing more excess water that they will be directed to SSLGC for this additional sale;
and
WHEREAS, both Cities and SSLGC have come to agreement that if either City is
expected to exceed the amount of water available to them in their annual allotment that SSLGC
may use excess water in the other City's allotment to overcome this deficit; and
WHEREAS, both Cities and SSLGC have come to agreement that the construction of a
second delivery point for the City of Schertz is an appropriate use of SSLGC impact fees and
that this construction should take place when requested by the City of Schertz; and
WHEREAS, city staff has worked with the City of Seguin and SSLGC to construct the
attached agreement that is acceptable to all three parties; and
WHEREAS, the City Council has determined that it is in the best interest of the City to
enter into the attached agreement to establish expectations on excess water sales and other
matters in connection therewith; THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS
THAT:
Section 1. The City Council hereby authorizes entering into the agreement in
substantially the same form as attached.
Section 2. The City Council, by this authorization gives approval to the City of
Seguin to sell excess water from their annual allotment to a 3rd party wholesaler as stipulated in
the 1999 agreement and the attached agreement once executed.
Section 3. The recitals contained in the preamble hereof are hereby found to be true,
and such recitals are hereby made a part of this Resolution for all purposes and are adopted as a
part of the judgment and findings of the City Council.
Section 4. All resolutions, or parts thereof, which are in conflict or inconsistent with
any provision of this Resolution are hereby repealed to the extent of such conflict, and the
provisions of this Resolution shall be and remain controlling as to the matters resolved herein.
Section 5. This Resolution shall be construed and enforced in accordance with the
laws of the State of Texas and the United States of America.
Section 6. If any provision of this Resolution or the application thereof to any person
or circumstance shall be held to be invalid, the remainder of this Resolution and the application
of such provision to other persons and circumstances shall nevertheless be valid, and the City
Council hereby declares that this Resolution would have been enacted without such invalid
provision.
Section 7. It is officially found, determined, and declared that the meeting at which
this Resolution is adopted was open to the public and public notice of the time, place, and subject
matter of the public business to be considered at such meeting, including this Resolution, was
given, all as required by Chapter 551, Texas Government Code, as amended.
Section 8. This Resolution shall be in force and effect from and after its final
passage, and it is so resolved.
PASSED AND ADOPTED, this 13th day of March, 2018.
CITY OFA IERTZ, TEXAS
R. Carpenter, Mayor
ATTEST:
(q WL5 Q'0 aa
Brenda Dennis, City ecretary
(CITY SEAL)
STATE OF TEXAS §
COUNTY OF GUADALUPE §
Tri- Lateral Agreement Relating to the Water Sales
This Tri - Lateral Agreement Relating to the Water Sales ( "Agreement ") is executed by and
among the City of Schertz, Texas ( "Schertz "), the City of Seguin, Texas ( "Seguin "), and
the Schertz/Seguin Local Government Corporation ( "SSLGC ") as of
, 2018 (the "Effective Date "). Schertz and Seguin are both Texas
home -rule cities and the SSLGC is a Texas non - profit, public corporation created by and
to act on behalf of Schertz and Seguin pursuant to Subchapter D of Chapter 431 (Sections
431.101- 431.109) of the Texas Transportation Code and other applicable law each of
which is authorized to enter into this Agreement pursuant to the authority as further
described below. Schertz, Seguin, and the SSLGC are jointly referred to as the "Parties,"
and individually, each a "Party."
Recitals:
1. The Parties entered into an agreement captioned "Regional Water Supply
Contract" dated November 15, 1999 that addressed the financing, construction, and
operation of a regional water supply project benefitting Schertz and Seguin (the "1999
Agreement "). Sometimes herein Schertz and Seguin are referred to as the "Cities ".
2. The 1999 Agreement provides the contractual authority for the SSLGC to operate,
maintain, and manage the SSLGC utility system on a regional basis for the direct benefit
of the residents and ratepayers of Schertz and Seguin and with respect to their respective
utility systems.
3. The Parties intend for this Agreement to be evidence of their respective approvals
and consents required by Section 2.08 of the 1999 Agreement, as follows: (i) the
reallocation of costs of an additional point of delivery for Schertz pursuant to Section 2.14
of the 1999 Agreement; (ii) the supply of water to other persons and /or third party
wholesalers pursuant to Section 2.16 of the 1999 Agreement; and (iii) the sharing of each
Party's capacity as set forth in Section 2.15 of the 1999 Agreement (but not the respective
obligation of Schertz and Seguin to the holders of SSLGC's bonds pursuant to Section
3.01 of the Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereto hereby agree as follows-
1 . Schertz and Seguin may each enter into contracts to supply water to third party
wholesalers and /or other persons who currently do not have a contract with the SSLGC,
provided, however, to the extent SSLGC is the source for the water supplied by the city
under such contract, upon compliance with the 1999 Agreement and other applicable law
the city entering into such contract shall be responsible, as among the Parties, for having
3842/32 #254175 FINAL 03 -09 -2018
the proportionate capacity of water available in SSLGC facilities to satisfy the
requirements under such contract, together with the requirements of the city entering into
such contract. Prior to entering into such contract, Schertz or Seguin, as appropriate shall
notify SSLGC as to the amount of water anticipated to be sold so that the capacity to
provide the additional water supplies can be verified and the corresponding sales can be
calculated into future rate setting by SSLGC.
2. Should any third party wholesaler and /or other person with an existing water
supply contract with SSLGC desire additional SSLGC water and SSLGC has the
capacity to supply the additional water, SSLGC will enter into such an agreement and
not Schertz or Seguin individually. In compliance with Sections 3.09 and 8.01 of the
1999 Agreement and Section 38 of the SSLGC bond resolution (the "Bond Resolution ")
adopted on October 20, 2016 authorizing the issuance of obligations designated as
Schertz /Seguin Local Government Corporation Contract Revenue Bonds, New Series
2016 (Texas Water Development Board SWIRFT Project Financing), dated August 1,
2016, in the principal amount of $43,670,000 (the "Outstanding Bonds ") the Parties
acknowledge that no more than 10% of the capacity of the System (as defined in the
Bond Resolution) may be contractually sold on a long -term basis to any private party or
entity or to any agency of the federal government in order to protect and preserve the
tax - exempt status on the Outstanding Bonds.
3. In compliance with the 1999 Agreement, the Parties agreed that an additional point
of delivery requested by Schertz, to be located in the general vicinity of the southern area
of Schertz, would be installed by the SSLGC and that Schertz would pay the costs of
installing the point of delivery in accordance with Section 2.14 of the 1999 Agreement.
The Parties now agree that the prior arrangement shall be modified and that the SSLGC
will pay the cost of installing the point of delivery from the SSLGC's fund receiving the
proceeds from impact fees paid by Schertz and Seguin. The Parties acknowledge the
current balance of such fund is sufficient to pay the cost of installation, but should the
amount of the funds be inadequate, then Schertz will pay for the installation costs of the
point of delivery in excess of the funds available to SSLGC in the impact fee fund.
4. Schertz and Seguin agree that each of the Cities, as well as the SSLGC, is allowed
to share or use any available proportionate allocations of the other city's 50% share of
the groundwater produced from the existing wells located in Gonzales County producing
water from the Carrizo Aquifer (the "Gonzales Wellfield ") in the Gonzales Wellfield with
each other and with SSLGC to provide the water production, treatment, and transmission
capacity from the Gonzales Wellfield required to satisfy the requirements of Schertz and
Seguin and the requirements of the supply of water to third party wholesalers and /or other
persons as may be allowed pursuant to this Agreement and the 1999 Agreement until
that availability does not exist. The Cities and SSLGC shall be notified as early as
possible that using more than a member City's allocation may be necessary so that all
Parties can plan accordingly.
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5. The general provisions of the 1999 Agreement, as set forth in Article VIII, sections
8.01 through 8.22, are incorporated by reference into this Agreement as if set forth
verbatim herein.
6. This Agreement is not intended to amend and should not be construed to amend
the 1999 Agreement, its covenants or obligations entered into in connection therewith, or
any other existing agreements, specifically including but not limited to agreements with
the Texas Water Development Board. To the extent any provision of this Agreement
irreconcilably conflicts with a provision of any existing agreement to which SSLGC is a
party, the provisions of such other agreement shall prevail.
IN WITNESS WHEREOF, the Parties hereto acting under authority of their
respective governing bodies have caused this Agreement to be duly executed as of
the Effective Date.
Attest:
Secretary, Board of Directors
Attest:
City Secretary
Attest:
City Secretary
SCHERTZ /SEGUIN LOCAL GOVERNMENT
CORPORATION
IN
President, Board of Directors
CITY OF SCHERTZ, TEXAS
IS
Mayor
CITY OF SEGUIN, TEXAS
IN
Mayor
3
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