Texas Water Development Board – December 13, 2018

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The Texas Water Development Board met on December 13 to take up all full agenda. The Board approved financial assistance totaling $162,994,350 for water and wastewater system projects. Of this funding, $57,254,350 was approved for rural projects.

Item 1. Outreach Activities

Jackson – Met with stakeholders, incl. Tarrant Regional, City of Dallas, San Juan, Creedmoor-Maha Water Supply; spoke at several water summits
Paup – Met with North Texas Municipal Water District, other stakeholders
Lake – Met with stakeholders, Brazos River Authority, Texas-Israeli Alliance, San Antonio Water Supply

Item 2. Consider approving the 86th Session Legislative Priorities report. (Kathleen Ligon) Board Agenda 02 Document

Biannual report of Board’s activities and recommendations for legislation required, drafting began in February
General recommendation is proactive flood mitigation; incl. improved flood mapping & modeling, improved watershed planning, and more technical/financial support
Mapping account should be reformed as GR-D account
Should extend deadline from HB 30 to identify brackish water production zones
Should enact statutory changes to reflect federal law affecting Clean Water State Revolving Fund
Clean up water conservation plan requirements for financial assistance applicants
Remove obsolete and duplicative requirements
Ken Kramer, Sierra Club – Sierra Club supports legislative priorities generally
- Sierra Club is fine with water conservation recommendations, but wants to caution that statutory changes should not undermine conservation planning, review, and reporting
- Would like to see closer coordination on TWDB and Sierra Club water conservation recommendations in the priorities report
Jackson – Sierra Club was very helpful in getting word out about SWIFT
Motion to approve proposed 86th Session priorities report passes

Item 3. Briefing and discussion on the 2018 State Flood Assessment. (Mindy Conyers) Board Agenda 03 Document

Final briefing on state flood assessment effort, no action required
Need for updating mapping/modeling, plan appropriately, and engage community; recommendation from Item 2 to support flood mapping and planning is also included, emphasizes need for statewide flood planning and financial investment
Jackson – Addressing stakeholder input is a very important part of this at the beginning to gauge public attitude in creation of the assessment; data quality is very important, as is the support of modeling and planning
Paup and Lake both commend staff for putting together the assessment

Item 4. Briefing and discussion on the preliminary, proposed structure and timeline for the 2019 prioritization cycle of the State Water Implementation Fund for Texas. (Tom Entsminger)

Announcing opening of 5th prioritization cycle for the SWIFT program, applications open today
Report summarizing SWIFT actions is being put online today and going to legislature this month
In 2019, Feb. 1 is deadline for abridged applications, will decide funding structures in Spring, complete application submitted & reviewed in Summer, bond sale in Fall, political subdivision closing in Winter
TWDB members commend the work done so far and look forward to this round of SWIFT implementation
Lake – Have used less than 20% of original balance to finance 30% of projects in State Water Plan, tremendous ROI for Texas

Item 5. Consider approving by resolution: (a) the issuance, sale and delivery of State of Texas Water Financial Assistance Bonds (Economically Distressed Areas Program) in one or more series; (b) the Preliminary Official Statement; (c) the Notice of Sale and Bidding Instructions; and (d) authorization for the Executive Administrator, General Counsel, Chief Financial Officer, or Development Fund Manager to act on behalf of the Texas Water Development Board in the sale and delivery of such bonds. (Georgia Sanchez)

Board approved EDAP applicants in Sept., authorized to begin general obligation bond sale in October
Coordinated with securities advisories to prepare bond sale proposal, will seek approval from legislature after approval from TWBD; preliminary steps in January & sale in February
Proposing a competitive sale, schedule calls for a close on bonds in February and can proceed with EDAP closings in March with approval
Motion to approve all aspects of Item 5 passes

Item 6. Consider amending the 2017 State Water Plan to incorporate an amendment to the 2016 Region L Regional Water Plan relating to a new recommended water management strategy project for the San Antonio Water System. (Sarah Backhouse) Board Agenda 06 Document

Proposed amendment incorporates minor amendment to 2016 Region L plan, water management project for San Antonio water system for advanced meter system
Specific changes detailed in Board agenda document
Capital costs will increase by $122.7 million & total projects increased by 1, no projects changed, by 3 are renamed
Did not receive comments, Exec Admin recommends approval
Jackson – Great modification, good to see communities engaged to make plan better
Motion to amend 2017 State Water Plan to incorporate amendment passes

Item 7. Consider authorizing the publication of proposed amendments to 31 Texas Administrative Code Chapters 371 and 375 related to financial assistance from the Drinking Water State Revolving Fund and the Clean Water State Revolving Fund. (Ashley Nwonuma) Board Agenda 07 Document

Results from effort to provide clarity
changing time to set interests rates for loans, removing requirement that bonds be redeemed in inverse order of maturity, federal requirement to include dedicated repayment source, clarifying that principal forgiveness can be provide in accordance with federal Acts, clarifying heading
Will have the standard 30-day comment period
Jackson – Good to see changes that streamline process and provide flexibility to borrowers
Motion to authorize publication of amendments passes

Item 8. Consider approving material changes to contracts for goods and services executed during the fourth quarter of fiscal year 2018 and the contract and performance report for the fourth quarter of fiscal year 2018. (David Carter) Board Agenda 08 Document

Material changes include postponements of 6 mos. or more and payment changes of 10%
Motion to approve passes

Item 9. Consider approving by resolution a request from the City of Arlington (Tarrant County) for $79,500,000 in financing from the Drinking Water State Revolving Fund for planning, design, and construction of water treatment plant improvements. (Luis Farias) Board Agenda 09 Document

construction of 2 new million-gallon clear wells, chlorine contact tank, pump station, as well as removal of 3 existing clear wells
Jackson – Good to see proactive investment in something that will enhance efficiency
Motion to approve request passes

Item 10. Consider approving by resolution a request from the Beaver Creek Water Control and Improvement District #1 (Burleson County) for $6,345,000 in grant from the Economically Distressed Areas Program for construction of a new water system project. (Caaren Skrobarczyk) Board Agenda 10 Document

Received EDAP funding for planning in 2011, HHSC issued nuisance finding qualifying district for more than 50% grant funding
two deep water wells, treatment facilities, storage tanks, etc.
Affordable loan component of $145k, district is proposing to fund this portion with cash on hand
Jackson – Fits criteria of EDAP, project will be beneficial to these communities & already invested in planning and design
Paup – Agrees, great example of EDAP helping a small community
Motion to approve passes

Item 11. Consider approving by resolution a request from the Moffat Water Supply Corporation (Bell County) for $3,300,000 in financing from the Texas Water Development Fund for planning, acquisition, design, and construction of a water system improvements project. (Caaren Skrobarczyk) Board Agenda 11 Document

Addressing water supply deficit for 2020 and meet additional storage needs
Jackson – Another example of a community proactively meeting needs
Motion to approve passes

Item 12. Consider approving by resolution a request from the City of Bevil Oaks (Jefferson County) for $500,000 in principal forgiveness from the Clean Water State Revolving Fund for planning, design, and construction of a Hurricane Harvey disaster recovery project. (Nancy Richards) Board Agenda 12 Document

Project to repair infrastructure, incl. sewer system, damage to excessive rainfall & flooding
TWDB notes this will get the community’s water supply system functional, good use of Fund dollars to repair damage from Harvey
Motion to approve passes

Item 13. Consider approving by resolution a request from Hardin County Water Control and Improvement District No. 1 (Hardin County) for $438,000 in principal forgiveness from the Clean Water State Revolving Fund for planning, design, and construction of a Hurricane Harvey disaster recovery project. (Nancy Richards) Board Agenda 13 Document

Projects to replace electrical system and sewer components, district has used local funding to replace some damaged systems & request is to finish work
TWDB notes again that project will repair damage from Harvey, good use of funds
Motion to approve passes

Item 14. Consider approving by resolution a request from Kerr County (Kerr County) for $13,375,000 in financial assistance consisting of $2,105,000 in financing and $11,270,000 in grant from the Economically Distressed Areas Program for construction of a wastewater collection system to provide first-time wastewater service to Center Point and surrounding areas in eastern Kerr County. (Dain Larsen) Board Agenda 14 Document

Part of the 3rd phase to construct wastewater system in Kerr County, 939 first time connections, has received funding from EDAP and Clean Water SRF program before
1st phase to be completed in 2019, 2nd and 3rd phases have not been bid yet, totaling $61.3 million in funding
Tetra Tech – Consulting on project and appreciate consideration
Jackson – Represents completion of a project and residents will benefit from sewer system
Motion to approve passes

Item 15. Consider approving by resolution a request from the North Alamo Water Supply Corporation (Hidalgo County) for $15,854,000 in financial assistance consisting of up to $13,375,000 from the Economically Distressed Areas Program with the remaining funding from the Clean Water State Revolving Fund, for construction of a wastewater collection and treatment system to provide first-time wastewater service to ten unincorporated subdivisions north of the City of Weslaco. (Mireya Loewe)

North Alamo Water Supply Corp. received EDAP funding in 2014 for a new wastewater treatment system for 10 unincorporated areas
Eligible to receive ~$8 million, requesting additional funding from Clean Water SRF to complete project, eligible for $500k in principal forgiveness and $3 million from SRF, also requesting additional equivalency loan to bring total to $13.375 million
Intending to use excess funds to extend connections to 2 additional subdivisions
Steven Sanchez, North Alamo Water Supply – Project is needed to improve water infrastructure & close to implementation
TWDB supports the project & connections to new areas
Motion to approve passes

Item 16. Consider approving by resolution a request from the Panhandle Groundwater Conservation District (Armstrong, Carson, Donley, Gray, Hutchinson, Potter, Roberts and Wheeler Counties) for $1,000,000 in financial assistance from the Agriculture Water Conservation Loan Program for an agriculture water conservation equipment loan program. (Laura Jarzombek) Board Agenda 16 Document

8 counties heavy in agriculture production, requesting funding to provide loans to area farmers for irrigation systems and related equipment; district is pledging net revenues, will be the 23rd loan to the district
Motion to approve passes

Item 17. Consider approving by resolutions a request from the City of Brady (McCulloch County) for $28,905,000 in financial assistance consisting of a $13,375,000 grant from the Economically Distressed Areas Program and $10,830,000 in financing and $4,700,000 in principal forgiveness from the Drinking Water State Revolving Fund for construction of a water system improvement project. (Laura Jarzombek) Board Agenda 17 Document

City is under admin order from EPA to address noncompliance re: contaminants in water supply, contaminants are typical of water source in area
City has completed planning, funds needed for construction; incl. treatment plant, transmission lines, storage facilities, etc.
Anthony Graves, City of Brady Mayor – Appreciates assistance on this project, wishes to present TWDB with a plaque commemorating assistance
Steven Miller, City of Brady – Appreciates that TWDB understands impact of federal regulation on Brady
Keith Kendall, Consultant – Still a lot of need for EDAP program funding, TWDB has assisted greatly with EPA compliance
Jackson – Glad to have the ability to address these challenges, commends local leadership
Motion to approve passes

Item 18. Consider approving by resolution a request from the El Paso Water Utilities Public Service Board acting on behalf of the City of El Paso (El Paso County) for $12,865,000 in funding consisting of $11,450,000 in grant and $1,415,000 in financing from the Economically Distressed Areas Program for construction of a first-time wastewater service project in the Montana Vista area. (Laura Jarzombek) Board Agenda 18 Document

Area is located in the Eastern-most portion of El Paso County, no sanitary sewer service exists in the area; project represents first-time sewer service for 800 households
Jackson – Another project desperately needing help from EDAP
Motion to approve passes

Item 19. Consider approving by resolutions a request from the City of Shallowater (Lubbock County) for: a) $2,500,000 in financial assistance consisting of $1,100,000 in financing and $500,000 in principal forgiveness from the Drinking Water State Revolving Fund and $900,000 in financing from the Texas Water Development Fund for the construction of water system improvements; and b) for a waiver from the requirement to include funds to mitigate water loss as a part of this project. (Laura Jarzombek) Board Agenda 19 Document

Under admin order by TCEQ for groundwater uranium levels, request incl. improvements to existing treatment plant
City is also above threshold for apparent water loss, request incl. waiver from req. to include funds to mitigate water loss
Motion to approve passes

Item 20. Consider approving by resolution a request from the City of Whiteface (Cochran County) for $450,000 in financing from the Drinking Water State Revolving Fund for planning, design, and construction of water system improvements. (Laura Jarzombek) Board Agenda 20 Document

Improvements incl. transmission line upgrades; city will use $5k from request for meters to address water loss, city is above apparent water loss threshold
Motion to approve passes

Item 21. Consider approving by resolution a request from the East Rio Hondo Water Supply Corporation for a partial release of lien on property owned by the Corporation. (Joe Reynolds) Board Agenda 21 Document

Requesting partial release of lien on 6 acres that are vacant and unimproved; no infrastructure and do not contribute to revenue stream
Motion to approve passes

TWDB did not receive any public comment & did not meet in executive session