The Texas Water Development Board met on September 1, 2022, to take up several items. The board approved proposed Fiscal Year 2023 to the Texas Water Development Board Investment Policy and Strategies, appointed a new member of the Water Conservation Advisory Council and approved resolution requests from the cities of Kingsville, Alice, and China for water supply projects. The full agenda and an archive of this hearing can be found here.
This report is intended to give you an overview and highlight of the discussions on the various topics taken up. It is not a verbatim transcript of the discussions but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
Item 1: Discussion regarding outreach efforts and activities by the Board.
- Member Brooke caught up with Texas 2036, Austin Regional Manufacturers Association, Rep. Kyle Kacal, and Sen. Perry, among others
Item 2: Consider approving by resolution delegation to the Executive Administrator and the Development Fund Manager the authority to utilize prepayments and other lawfully available funds to pay, redeem, and defease General Obligation Bonds.
Alejandro Imatzu, Financial Analyst, TWDB
- Wants to create more efficient mechanism for irrigation debt
- Sept 30, 2023, extension requested
- Recommends approval of this item
- Director Peyton – Record year for refunds?
- Yes, not for prepayments but for redemptions
- Chair Paup – Great job, thanks for keeping us out of trouble with the IRS
- Motion passes
Item 3: Consider approving the Fiscal Year (FY) 2023 Texas Water Development Board Investment Policy and Strategies.
Chi Ngyuen, Executive Administrator’s Staff
- Policy contains guidance regarding staff trainings and investment officers
- Required to review policy annually and recommend changes
- No changes proposed since last year
- Director Peyton – Looks like a good plan to wisely invest dollars
- Motion passes
Item 4: Consider approving the Fiscal Year (FY) 2023 Underwriting Policies and Procedures for Negotiated Bond Transactions of the Texas Water Development Board.
David Duran, Executive Administrator’s Staff
- Provides detailed guidance on bond market performance factors
- Proposes no changes except minor update
- Director Peyton – Looks good, keeps underwriters’ feet to the fire; helps keep costs low
- Chair Paup – This is a DPM report card essentially
- Motion passes
Item 5: Consider approving the Fiscal Year (FY) 2023 Debt Management Policy of the Texas Water Development Board.
David Duran, Executive Administrator’s Staff
- First adopted in 2007, serves as a best practices document
- Includes info on financial conditions in debt markets, credit ratings, etc.
- Proposes no changes except minor updates to reflect best practices
- Director Peyton – We need to continue to review and revise this document to make us better; looks good
- Chair Paup – Fiduciary duty to TWDB update important
- Motion passes
Item 6: Consider approving Internal Audit’s Fiscal Year 2023 Audit Plan.
Nicky Carter, Board Auditor Division
- The board’s internal audit system is done impartially
- Professional auditing standards require systematic assessment of risk and risk factors
- FY23 includes review of quarterly investment reports, recruitment and retention of employees, and flooding and category 1 projects
- Contingency plans listed in the event of shifting in priorities
- Director Peyton – Please with what’s listed; moves away from compliance and toward value-added services
- Chair Paup – Risk management is important and necessary; never worked with a better internal audit staff
- Motion passes
Item 7: Consider authorizing the Executive Administrator to execute multiple contracts in a total amount not to exceed $1,250,000 for lidar data collection and quality control in Texas, using the Strategic Mapping Program and their associated contracts at the Texas Department of Information Resources.
Joey Thomas, Executive Administrator’s Staff
- $1.25M budget cap to serve El Paso region where federal quality level not currently met
- Director Peyton – Data can be used across the state; competitive bids good
- This project projected at $200-250 per square mile
- Chair Paup – Data available is 12 years old so need better, more current information
- Motion passes
Item 8: Consider appointing members to the Water Conservation Advisory Council.
John Sutton, Executive Administrator’s Staff
- Council created in 2007 by Texas leg, made up of volunteers with expertise in water quality
- Develop best practices for water conservation and create report every 2 years with recommendations
- Vacancy due to retirement; solicited nominations internally and externally; 8 nominations received and considered
- Ryan Sabrosky nominated by Council until 2029; he’s with Texas Nursery & Landscape Association
- State agencies also on the Council appoint David Villareal and Marky Kelly
- Chair Paup – Ryan a great professional and resource
- Motion passes
Item 9: Approve by resolution a request from the City of Kingsville (Kleberg County) for 700,000 in financial assistance consisting of $399,000 in financing and $301,000 in grant from the Flood Infrastructure Fund for planning, design, and construction of a stormwater drainage project.
Mireya Loewe, Executive Administrator’s Staff
- In 2018, city developed drainage plan and in 2021 received 4 funding commitments through FIF for 4/5 projects
- This is for the 5th funding request to address location #8 on drainage plan for 148 homes
- Director Peyton – Extends from 2 to 10-year flood event, which is great
- Motion passes
Item 10: Approve by resolution a request from the City of Alice (Jim Wells County) for $7,000,000 in financial assistance consisting of $4,954,000 in financing and $2,046,000 in principal forgiveness from the Drinking Water State Revolving Fund for planning, acquisition, design, and construction of a water supply project.
Mireya Loewe, Executive Administrator’s Staff
- $5.5M received for lowering costs and adding additional water source for first phase of project
- Once completed, city expected to only use a small amount of water from Corpus Christi
- City constructed first well and is assessing water quality
- City entered into public-private partnership in which they purchase water from a plant through Seven Seas
- Now want to change plan and request additional funding to build more wells and raw water line, get environmental clearance for project, acquire easements, and contract engineering services
- Seven Seas corporation responsible for management of project
- City qualified for $3.145M in equivalency funding
- Chair Paup – Committee will be watching closely for public/private partnership lessons learned
- Director Peyton – Commendable the city is looking for alternative water sources; public-private partnerships can work well; This project could have been structured better but in favor overall
- Director Peyton – Concerned about rural rate payers; legal assistance to evaluate contracts may be important to consider in the future with such projects
Michael Esparza, City Manager, City of Alice
- Speaking in favor of project due to limited water sources currently
- TWDB staff incredible to work with, very knowledgeable
- Seven Seas is a fully vetted partnership through legal with multiple agencies
- Motion passes
Item 11: Approve by resolution a request from the City of China (Jefferson County) for $6,000,000 in financing from the Clean Water State Revolving Fund for planning, design, and construction of a wastewater treatment plant project.
Tyrone Alcorn, Executive Administrator’s Staff
- Provides synopsis of city demographics
- Current wastewater system needs to be updated due to aged components not meeting safety standards
- Would demolish current system for new system to be built
- Director Peyton – Was principal forgiveness an option? Overall looks good
- City did not request this disadvantaged status
- Chair Paup – Excellent project for small community; saves $1.6M over loan period
- Motion passes
Item 12: Consider approving the State Fiscal Year 2023 Clean Water State Revolving Fund Intended Use Plan covering General Activities.
Item 13: Consider approving the State Fiscal Year 2023 Drinking Water State Revolving Fund Intended Use Plan covering General Activities.
Jeff Walker, Executive Administrator
- Many changes on accelerated timeframe; wants to address them succinctly
- Requests to tailor these items and hold off on consideration until next meeting, needs more time to address and vet comments
- Chair Paup – Agree, need more time including a working committee on this
- Items tabled until next meeting
Item 14: The Board will receive comments from the public on any matters within the jurisdiction of the TWDB, with the exception of matters which are subject to the ex parte prohibition found in Texas Government Code Section 2001.061.
Mitchell Billington, Entrepreneur
- Has application with U.S. patent office to pool water out of atmosphere separate from Texas electricity system
- Couldn’t contact committee on social media or email so looking for someone to work with to present data and develop system
- Chair Paup – Will have chief of staff get his info and put him in contact with the right people
Adjournment