HomeMy WebLinkAboutR2025-184 20251027RESOLUTION NO. R2025-184
A Resolution of the City Council of the City of Pearland, Texas, authorizing a
First Supplement to a Water Supply Contract with the Gulf Coast Water
Authority.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS:
Section 1. That certain First Supplement to a Water Supply Contract by and between
the City of Pearland and Gulf Coast Water Authority, a copy of which is attached hereto as Exhibit
“A” and made a part hereof for all purposes, is hereby authorized and approved.
Section 2. That the City Manager or his designee is hereby authorized to execute and
the City Secretary to attest a First Supplement to a Water Supply Contract with Gulf Coast Water
Authority.
PASSED, APPROVED and ADOPTED this the 27th day of October, A.D., 2025.
________________________________
J.KEVIN COLE
MAYOR
ATTEST:
________________________________
FRANCES AGUILAR, TRMC, MMC
CITY SECRETARY
APPROVED AS TO FORM:
________________________________
DARRIN M. COKER
CITY ATTORNEY
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Execution Version
FIRST SUPPLEMENT TO
WATER SUPPLY CONTRACT
BETWEEN
GULF COAST WATER AUTHORITY
AND
CITY OF PEARLAND, TEXAS
0\. Z6 , 2025
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Execution Version
FIRST SUPPLEMENT TO WATER SUPPLY CONTRACT BETWEEN
GULF COAST WATER AUTHORITY AND
CITY OF PEARLAND, TEXAS
This FIRST SUPPLEMENT TO WATER SUPPLY CONTRACT BETWEEN GULF
COAST WATER AUTHO TY AND CITY OF PEARLAND, TEXAS (this "First
Supplement"), dated as of z$b , 2025, is by and between the GULF COAST WATER
AUTHORITY, a conservation and reclamation district and political subdivision of the State of
Texas the "Authority"), and the CITY OF PEARLAND, TEXAS, a municipal corporation and
home rule municipality of the State of Texas (the "City").
RECITALS:
WHEREAS, the City owns and operates a waterworks system supplying water to
inhabitants of the City and adjacent areas; and
WHEREAS, the Authority has the responsibility and authority to develop water supplies
for agricultural, municipal, industrial and other uses in the Gulf Coast area; and
WHEREAS, the Authority is one of the participants to the Plant Cost Sharing Agreement,
pursuant to which the Authority has acquired, on behalf of the City and the City of League City,
Texas ("League City"), capacity in the Plant; and
WHEREAS, the City and the Authority have entered into that certain Water Supply
Contract between the Gulf Coast Water Authority and the City of Pearland, Texas, dated as of
June 29, 2007 (the "Agreement"), which, inter alia, governs the City's obligation to pay the
Authority its proportionate share of the payments charged to the Authority by the Managing
Participant for the surface water from the Plant that is provided to the City through the Authority
under the 2001 Cost Sharing Agreement, as amended by the 2007 Amendment (together, the 2001
Cost Sharing Agreement and the 2007 Amendment are referred to as the "Plant Cost Sharing
Agreement"); and
WHEREAS, Section 2.10 of the Agreement provides that all payments required to be made
by the City to the Authority under the Agreement shall be payable from the revenues and income
received by the City from the ownership and operation of its water system; and
WHEREAS, the City and the Authority acknowledge that the payments made by the City
to the Authority under the Agreement are the sole source of funds available to the Authority to
meet its payment obligations for the City's proportionate share of the payments due to the
Managing Participant under the Plant Cost Sharing Agreement; and
WHEREAS, in order to resolve a dispute about the proper calculation for the estimated
raw water demand capacity cost, and thus the final amounts owed to the Managing Participant by
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the City of Friendswood, Texas ("Friendswood"), and the Authority therefor, under Exhibit "I"
of the 2007 Amendment, and the proper method to calculate said amounts owed, the Authority,
the Managing Participant and Friendswood have entered into that certain Settlement Agreement
for Agreed Payment Amount and Payment Schedule under Amendment to Cost Sharing
Agreement — Southeast Water Purification Plant (Restated and Amended) dated as of
, 2025 (the "Settlement Agreement"); and
WHEREAS, pursuant to the Settlement Agreement, the Authority has agreed to make
certain settlement payments to the Managing Participant on behalf of the City and League City in
the total amount of $5,181,363.00 (the "Settlement Amount") in full satisfaction of the payment
obligations of the Authority under Exhibit "I" of the 2007 Amendment; and
WHEREAS, the City and the Authority now desire to enter into this First Supplement
providing for the City's payment to the Authority of its proportionate share of the Settlement
Amount as a separate line item component of the Operating Charges in accordance with and
subject in all respects to the terms of the Agreement, the Settlement Agreement and the Plant Cost
Sharing Agreement; and
NOW, THEREFORE, in consideration of the premises, and for good and valuable
consideration, the City and the Authority agree as follows:
AGREEMENT
Section 1. The recitals contained herein are hereby found to be true, and such recitals are
hereby made a part of this First Supplement for all purposes.
Section 2. All capitalized terms not defined herein shall have the meanings assigned to
such terms in the Agreement.
Section 3. The Agreement is hereby supplemented by this First Supplement, but the First
Supplement does not change the terms thereof.
Section 4. The City will pay the Authority the amount of $3,454,242.00, its proportionate
share of the Settlement Amount, in ten (10) equal yearly installments of $345,424.20 that will then
be divided monthly (each monthly installment, a "Settlement Charge"), beginning in the Managing
Participant's fiscal year 2027 (i.e., the fiscal year beginning July 1, 2026, and ending June 30,
2027). The Authority will bill the Settlement Charge to the City monthly as a separate line item
component of the Operating Charges, which will be payable by the City in the same matter as all
Operating Charges pursuant to Section 2.6 of the Agreement. When the City makes a payment of
the Settlement Charges to the Authority, the Authority shall forward such payment to the
Managing Participant in the same manner in which the Authority forwards payment to the
Managing Participant of all Operating Charges as required by the Plant Cost Sharing Agreement.
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(Signature pages follow)
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Execution Version
AGREED TO THIS 27 day of 10/28/2025 I 2:0'1. CDT
CITY OF PEARLAND, TEXAS
p --DocuSigned by:
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City Manager
ATTEST:
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City Secretary
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GULF COAST WATER AUTHORITY
ATTEST:
Secretary, Board of irectors
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C83242
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SETTLEMENT AGREEMENT FOR
AGREED PAYMENT AMOUNT AND PAYMENT
SCHEDULE UNDER AMENDMENT TO COST SHARING AGREEMENT -
SOUTHEAST WATER PURIFICATION PLANT (RESTATED AM) AMENDED)
This SETTLEMENT AGREEMENT FOR AGREED PAYMENT AMOUNT AND
PAYMENT SCHEDULE UNDER AMENDMENT TO COST SHARING AGREEMENT —
SOUTHEAST WATER PURIFICATION PLANT (RESTATED AND AMENDED) (this
"Agreement") is made and entered into by and between the CITY OF HOUSTON, TEXAS
("Houston"), a home -rule city of the State of Texas, THE CITY OF FRIENDSWOOD, TEXAS
("Friendswood"), a home -rule city of the State of Texas, and GULF COAST WATER
AUTHORITY ("GCWA"), a conservation and reclamation district and a political subdivision of
the State of Texas. Houston, Friendswood, and GCWA are referred to collectively as the "Parties"
and individually as a "Party." This Agreement will become effective as of the date of the signature
of the Director of Houston Public Works (the "Effective Date").
RECITALS
WHEREAS, the Parties are participants to that certain Amendment to Cost Sharing
Agreement — Southeast Water Purification Plant (Restated and Amended) made effective on
September 27, 2007 (the "Amended Agreement").
WHEREAS, a dispute has arisen between the Parties about the proper calculation for the
estimated raw water demand capacity cost, and thus the final amounts owed to Houston by
Friendswood and GCWA therefor, under Exhibit "I" of the Amended Agreement and the proper
method to calculate said amounts owed (the "Payment Dispute").
WHEREAS, to resolve the Payment Dispute, the Parties desire to enter into this
Agreement, pursuant to which (i) Friendswood and GCWA agree to make payments in the
amounts and upon the terms set forth in Sections 1 and 2 of this Agreement, and (ii) Houston
agrees to accept such payments upon such terms in full satisfaction of the payment obligations of
Friendswood and GCWA under Exhibit "I" of the Amended Agreement.
WHEREAS, the Parties agree that this Agreement is not intended to be an admission by
any Party concerning any matter related to and/or arising from the Payment Dispute.
NOW, THEREFORE, in consideration of the mutual promises contained herein and other
good and valuable consideration, the Parties agree as follows:
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AGREEMENT
1. Houston and Friendswood:
Houston and Friendswood agree that Friendswood's full payment amount provided
for consideration for this Agreement is $2,072,903.40.
Friendswood agrees to either (i) pay this amount in full within ninety (90) days after
the Effective Date, or (ii) pay this amount in ten (10) equal yearly installments of
$207,290.34 that will then be divided monthly to be charged to Friendswood by
Houston beginning in Houston's Fiscal Year 2027 as a separate line item that is
part of Friendswood's Southeast Water Purification Plant costs.
2. Houston and GCWA:
Houston and GCWA agree that GCWA's full payment amounts provided for
consideration for this Agreement are as follows: (i) $3,454,242.00 for GCWA's
Pearland account, and (ii) $1,727,121.00 for GCWA's League City account.
GCWA agrees to pay these amounts in ten (10) equal yearly installments of
$345,424.20 for GCWA's Pearland account and $172,712.10 for GCWA's League
City account that will then be divided monthly to be charged to GCWA by Houston
beginning in Houston's Fiscal Year 2027 as a separate line item that is part of
GCWA's Southeast Water Purification Plant costs.
3. Not an Admission of Liability. It is acknowledged and agreed that all Parties
represent and warrant that this Agreement and the payments detailed herein
constitute a final agreement of an agreed amount owed, and such payments are not
to be construed as an admission of fault or liability for any of the Parties, or anyone
else, in this or any other proceeding. Each Party expressly denies any liability,
fault, or wrongdoing.
4. Governing Law and Venue. This Agreement shall be construed and interpreted
in accordance with the applicable laws of the State of Texas. Mandatory venue for
any disputes relating in any way to this Agreement shall lie exclusively in a court
of appropriate jurisdiction in Harris County, Texas.
5. Severability. If any portion of this Agreement is found to be null, void or
unenforceable, the remainder of this Agreement shall remain in full force and effect
and be severable.
6. Recitals. The recitals contained herein are hereby found to be true, and such
recitals are hereby made a part of this Agreement for all purposes.
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7. Entire Agreement. This Agreement embodies the entire agreement between the
Parties as to the Payment Dispute, and supersedes all prior agreements and
understandings, if any, relating to the Payment Dispute and may be amended only
by an instrument in wiring executed jointly by a duly authorized officer or agent of
each of the Parties. There are no representations, agreements, arrangements,
promises, discussions, negotiations, statements, or understandings, oral or written,
relating to the Payment Dispute that are not fully expressed or provided for herein,
and none of the Parties have relied on any agreements, discussions, negotiations,
arrangements, promises, understandings, statements or representations that have
been made by any other party related to the Payment Dispute that are not set forth
in this Agreement. The terms of this instrument are contractual and not mere
recitals, and the undersigned specifically represent that the contents and the effects
hereof are fully and completely agreed to and understood.
8. Multiple Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original for all purposes and all of
which constitutes, collectively, one agreement; but, in making proof of this
Agreement, it shall not be necessary to produce or account for more than one such
counterpart.
9. Interpretation. This Agreement is a result of substantial negotiations between the
Parties and their counsel. Accordingly, the fact that counsel for one party or another
drafted this Agreement shall not be material to the interpretation of this Agreement.
10. Headings. The headings, captions, and arrangements used in this Agreement are,
unless specified otherwise, for convenience only and shall not be deemed to limit,
amplify, or modify the terms of this Agreement, nor to affect the meaning thereof.
11. Disclaimer of Reliance. Each Party expressly warrants and represents that no
promise or agreement which is not herein expressed has been made to it in
executing this Agreement, and that no Party is relying on any statement or
representation of any agent of the Party being released hereby. Each Party is relying
upon its own judgment and each Party has been represented by counsel of its
choosing. Each Party's counsel has read and explained to it its entire contents of
the Agreement in full, as well as the legal consequences of executing this
Agreement.
12. Cooperation. The Parties acknowledge and agree that they will cooperate to
effectuate the intent of this Agreement.
13. Non -Assignment. The Parties agree that the rights, obligations and privileges
contained in this Agreement are not assignable without the written consent of all
Parties to this Agreement.
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14. Signatures and Authority. The Parties have executed this Agreement in multiple
copies, each of which is an original. Each person signing this Agreement on behalf
of a Party represents and wan -ants that he or she is duly authorized to bind that Party
to this Agreement by his or her signature and has legal capacity to execute and
deliver this Agreement on behalf of that Party. Each Party represents and warrants
to the other Parties that the execution and delivery of this Agreement and the
performance of such Party's obligations hereunder have been duly authorized, and
that the Agreement is a valid and legal agreement binding on such Party and
enforceable in accordance with its terms. The Parties hereby agree that each Party
may sign and deliver this Agreement electronically or by electronic means and that
an electronic transmittal of a signature, including but not limited to, a scanned
signature page, will be as good, binding, and effective as an original signature.
[SIGNATURE PAGES FOLLOW]
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CITY OF FRIENDSWOOD, TEXAS
By:
Morad Kabiri
City Manager
Date: August 05, 2025
ATTEST:
Raquel Martinez
City Secretary
APPROVED AS TO FORM:
By: U �i'�r1.Q)V
Karen L. Horner
City Attorney
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GULF COAST WATER AUTHORITY
By:
Name: Brandon Wade
Date: October 16, 2025
ATTEST:
By:
Name: Renee Dondonay
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DS
APPROVED:
5oESaecretary
,-DocuSigned by:
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Director,` Houston Public Works
APPROVED AS TO FORM:
,-Signed by:
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Senior Assistant City Attorney
L.D. File No. LD-CON-0000004879
CITY OF HOUSTON, TEXAS
Signed by:
Signed by:
Mayor\
—DocuSigned by:
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COUNTERSIGNED BY:
DS
City Controll
DocuSigned by:
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DATE COUNTERSIGNED:
1/20/2026