Loading...
HomeMy WebLinkAbout1996-213J \NPDOCS\ORD\TMPA ORD ORDINANCE NO. CI (V—cZ 13 AN ORDINANCE APPROVING AND AUTHORIZING THE MAYOR OF THE CITY OF DENTON, TEXAS TO EXECUTE AN AMENDMENT TO THE POWER SALES CONTRACT DATED SEPTEMBER 1, 1976, BETWEEN THE TEXAS MUNICIPAL POWER AGENCY AND THE CITIES OF BRYAN, DENTON, GARLAND AND GREENVILLE, TEXAS, AND RESOLVING OTHER MATTERS INCIDENTAL AND RELATED THERETO, AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the Texas Municipal Power Agency (the "Agency") and the Cities of Bryan, Denton, Garland, and Greenville, Texas, have previously executed a certain Power Sales Contract, dated September 1, 1976, as amended in 1989 (the "Power Sales Contract"); and WHEREAS, the Power Sales Contract requires the City of Denton, Texas (the "City"), along with the Cities of Bryan, Garland, and Greenville, Texas (collectively, the "Member Cities") to take with certain exceptions all of their power and energy requirements from the Agency; and WHEREAS, the Agency and the Member Cities have agreed to amend the Power Sales Contract to convert that Power Sales Contract from a requirements contract to a take or pay contract and to make additional changes to the Power Sales Contract, and WHEREAS, the City desires to approve the amendment to the Power Sales Contract as presented to the City Council at the meeting at which this Resolution is considered; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION I. That the Power Sales Contract amendment, a copy of which is attached hereto as Exhibit A and incorporated herein for all purposes, between the Agency and the Member Cities is hereby approved in substantially the form and content as set forth in Exhibit A, and that the Mayor is authorized to execute the same. SECTION II. The City Council hereby reaffirms the obligation of the City specified in Section 10 of the Power Sales Contract to the effect that the City's obligations under said contract shall constitute an operating expense of the city's electric system and the obligations under said contract shall be payable solely from the revenues and receipts of such electric system and shall not constitute a general obligation on other assets or revenues of the City SSECTION III. That the amendments to the Power Sales Contract shall become effective upon the approval of the Member Cities and the Agency, upon final execution of the said Power Sales Contract amendment, and upon satisfaction of the other conditions that are specified in the Power Sales Contract or the bond resolutions associated with the outstanding bonds of the Agency and upon the entry by a court of competent jurisdiction of a final judgment validating the amendments to the Power Sales Contract. PASSED AND APPROVED this the &day of AQd , 1996. JAQWMILLER, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY AMENDMENT TO POWER SALES CONTRACT BETWEEN TEXAS MUNICIPAL POWER AGENCY AND CITY OF BRYAN, TEXAS CITY OF DENTON, TEXAS CITY OF GARLAND, TEXAS CITY OF GREENVILLE, TEXAS This Amendment to Power Sales Contract (the "Amendment"), made and entered into as of the 5th day of November, 1997, by and between the Texas Municipal Power Agency, a municipal corporation and political subdivision of the State of Texas and herein referred to as the "Agency" and the City of Bryan, Texas, the City of Denton, Texas, the City of Garland, Texas and the City of Greenville, Texas, each of which cities is a municipal corporation of the State of Texas and a home rule city, and herein collectively called the "Cities" and individually called "City " WITNESSETH WHEREAS, the Agency and the Cities entered into that certain Power Sales Contract (the 'Power Sales Contract"), made and entered into as of the 1st day of September, 1976, which Power Sales Contract was amended by and between the Agency and the Cities as of the 1st day of September, 1976 (such amendment together with the Power Sales Contract being herein called the "Contract"), WHEREAS, the Cities desire to amend the Contract to provide each of them with the ability to purchase or to generate Power and Energy from sources other than the Agency and other than as contained in the Contract, WHEREAS, the Cities have agreed to alter the terms and conditions upon which they each agree to purchase Power and Energy from the generating facilities of the Agency to provide that the Cities will be unconditionally obligated to take or pay for Power or Energy, or both, from the Agency in accordance with the provisions set forth below in this Amendment, WHEREAS, the Agency concurs with the desire of the Cities to purchase Power and Energy as provided in this Amendment, WHEREAS, the Board of Directors of the Agency adopted Rules and Regulations on November 18, 1976 and such Rules and Regulations have from time to time been amended and are herein referred to as the 'Rules and Regulations", 817198/0023404012 WHEREAS, the Agency has obtained the consents and given the notices required to be obtained or given prior to entering into the Amendment, WHEREAS, the Cities hereby reaffirm their commitment to the Agency and the holders of the outstanding Debts to provide the payments required under the Contract to assure that the obligations of the Agency are timely paid in accordance with the provisions of the Contract, NOW, THEREFORE, in consideration of the mutual undertakings herein contained, the Agency and each of the Cities hereby agree as follows SECTION I Section 3(a) of the Contract is hereby amended to read as follows Section 3 Sale and Purchase of Power and Energy (a) Each City and the Agency agree as follows (1) Each City shall be entitled to purchase and receive a percentage of the available output of Power and Energy from the generating facilities owned by the Agency The percentage of available output to which each City is entitled is as set forth in Section 3(a)(2) hereof (2) For the right to receive Power and Energy from the Agency, each City shall be unconditionally obligated to pay to the Agency, without offset or counterclaim and without regard to whether Power and/or Energy is delivered by the Agency to the respective City or Cities or whether or not any City or Cities actually use Power and/or Energy from such generating facilities the percentage of the Annual System Costs, including the payment of the Debt Service Requirements and Operating and Maintenance Expenses which may from time to time exist, set forth below City of Bryan, Texas 21 7% City of Denton, Texas 213% City of Garland, Texas 47 0% City of Greenville, Texas 10 0% (3) The percentage of the payment obligation of each City shall be subject to amendment by the mutual agreement of the Cities, provided, however, that the percentages shall never total less than one hundred percent (100%) of the Annual System Costs 817198/D028404012 _2 its entirety 917199/0029404012 (4) Each City binds itself to take or pay for its entitlement to Power and Energy in accordance with the rates and charges established pursuant to Section 7 of this Contract SECTION II Section 3(b) of the Contract is hereby amended to read as follows Section 3 Sales and Purchase of Power and Energy (b) The Agency shall devote its best efforts to the generation and delivery of Power and Energy from the generation facilities of the Agency SECTION III Section 3(c) of the Contract is hereby amended by deleting Section 3(c) in SECTION IV Section 7(a)(3) of the Contract is hereby amended to read as follows Section 7 Rates and Charges- (3) an amount sufficient to (1) pay the Annual System Costs as set forth in the Annual System Budget, as provided in the Rules and Regulations, (ii) make the deposits required by the Bond Resolution, (ni) fund the annual capital budget, as provided in the Rules and Regulations, and (iv) with respect to other funds or other accounts established by the Board and not required by the provisions of the Bond Resolution, fund such funds or accounts in an amount not greater than 3 5% of the Annual System Budget, or such greater amount as may be approved by the affirmative vote of at least six (6) members of the Board of Directors of the Agency with at least one (1) member of the Board of Directors appointed by each City voting in favor of any such increase Except for funds held for purposes of self insurance, any funds held by the Agency on September 30, 1998, and any funds held by the Agency on the last day of each Contract Year thereafter over and above the amounts required in connection with subsections (i), (n), (in) and (iv) of this Section 7(a)(3) shall be returned to the Cities within 120 -3. days of such date in the same percentage as the percentage each City contributed to such amounts Funds held pursuant to subsection (iv) of this Section 7(a)(3), if approved by the affirmative vote of at least six (6) members of the Board of Directors of the Agency with at least one (1) member of the Board of Directors appointed by each City voting in the affirmative, may be used to reduce the debt of the Agency SECTION V Section 12 of the Contract is hereby amended by adding subsections (f) and (g) to read as follows Section 12 Covenants of the Agency (f) The Agency covenants and agrees that in the event properties of the System which were acquired with funds received from the sale of Bonds are sold, the proceeds from the sale of such properties shall be applied in accordance with the provisions of 6 22 of the Bond Resolution (g) No Bonds, Subordinated Indebtedness or Special Contract Obligations shall be issued or incurred without the prior approval of the Board of Directors of the Agency SECTION VI Section 13(d)(1)(a) of the Contract is hereby amended to read as follows Section 13 Project Approval and Rights of Cities when a Project is not Approved (a) Each City shall be entitled to schedule and receive, each month for its own account, the proportion of the available Power and Energy from the System equal to the percentage established under Section 3(a) of this Contract, as such percentage may be from time to time adjusted in accordance with the provisions of Section 3(a) hereof SECTION VII Section 13(d)(1)(b) of the Contract is hereby amended to read as follows Section 13 Project Approval and Rights of Cities when a Project is not Approved 817192/D929994912 '�' Approved Approved (b) As consideration for such Power and Energy, and the right to purchase the same, each City shall, each month, pay to the Agency its proportionate share of the Annual System Costs equal to the percentage established under Section 3(a) of this Contract, as such percentage may be from time to time adjusted in accordance with the provisions of Section 3(a) hereof SECTION VIII Section 13(d)(1)(c) of the Contract is hereby amended to read as follows Section 13 Project Approval and Rights of Cities when a Project is not (c) Each City's obligation under Section 14 of this Contract shall be equal to the greater of the percentage established under Section 3(a) of this Contract or the percentage established under Section 14 hereof SECTION IX Section 13(d)(2) of the Contract is hereby amended to read as follows Section 13 Project Approval and Rights of Cities when a Project is not (2) During the balance of the term of this Contract after the effective date of the option, the amount of Power and Energy required by the City exercising the option to be purchased under Section 3 of this Contract shall be limited Such City shall, in each calendar month, take or pay for an amount of Power and Energy equal to the amount of Power and Energy such City is entitled to receive from the Agency during the corresponding month or such other amount of Power and Energy as may be from time to time agreed upon by the City, the Agency and other Cities, but in no event shall such take or pay requirement be less than the amount required to be paid pursuant Section 3(a) or Section 14 hereof, whichever amount shall be greater, and the Agency shall not be required to provide any Power and Energy in excess of the amount to which such City is entitled pursuant to Section 3(a) hereof The Power and Energy furnished to such City shall be billed by the Agency at rates and charges as from time to time adopted pursuant to Section 7 of this Contract The calculation of the limiting City's obligation under Section 14 of this Contract shall assume such City's Net Energy for Load for the purposes of said calculations is equal to 817198/1)0284M 12 "5" such City's Net Energy for Load in the completed Contract Year next preceding the effective date of the option or the amount required to be paid pursuant Section 3(a) hereof, whichever is greater SECTION X All other terms, provisions, conditions and obligations of the Power Sales Contract between the Cities and the Agency, dated September 1, 1976, as the same has been amended prior to the effective date of this Amendment, shall remain in full force and effect, and said Power Sales Contract, as amended, shall be construed together as a single contractual agreement This Amendment shall become effective upon the execution by the Agency and the Cities, all by the proper officer duly authorized by the Agency and the Cities to execute this Amendment for and on behalf of said executing party 81918&D023904012 "6" ATTEST ATTEST By lq� �:V,&QA.���v� ATTEST By Pb-,- 817198/09'L 4M 12 �� TEXAS MUNICIPAL POWER AGENCY BY I 7q CITY OF DENTON, TEXAS . ., OF GARLAND, TEXAS CITY OF GREENVILLE, TEXAS BY�ZLLL CITY OF DENTON TEXAS MUNICIPAL BUILDING • DENTON, TEXAS 76201 • TELEPHONE (817) 566-8200 Office of City Attorney October 23, 1996 Mr. Bob Dransfield, Attorney Fulbright & Jaworski 2200 Ross Avenue, Suite 2800 Dallas, Texas 75201 Re: Amendment to Power Sales Contract (TMPA) Dear Mr. Dransfield: Enclosed please find nine (9) copies of the executed Amendment to Power Sales Contract. The Mayor has executed the contract on this date and we are forwarding the copies to you in accordance with Carl Shahady's request, as contained in his letter of October 2, 1996. I regret the brief delay in securing our execution of the Agreement by Mayor Miller. Pursuant to our telephone discussion of October 11, 1996, I waited to present the Agreement to Mayor Miller upon his return to Denton from extended travel. Please forward a fully -executed copy of the Agreement to me once TMPA has executed same. Thank you for your assistance with this matter. Sincerely, i II, Michael S Copeland Assistant City Attorney MSC:tr Enclosures pc: Jack Miller, Mayor (letter only) Ted Benavides, City Manager (letter only) Herbert L. Prouty, City Attorney Carl J. Shahady, Attorney (letter only) Charles Hinton, City Attorney (letter only) Gary Smith, City Attorney (letter only) Robert E. Nelson, Executive Director for Utilities Jennifer Walters, City Secretary J \WPDOCS\COR\TMPALANY LET "Dedicated to Quality Service" OFFICE OF THE CITY ATTORNEY MEMORANDUM TO Jennifer Walters, City Secretary FROM Michael S Copeland, Assistant City Attorney SUBJECT Amendment to Power Sales Contract TMPA/City of Denton, Texas et al DATE November 13, 1997 Attached is an executed original of the foregoing contract which this office received from TMPA's Agency Attorney on November 7, 1997 Please attach this executed original document to Ordinance No 96-213 which was enacted by the City Council on September 17, 1996 The reason for the nearly fourteen month delay in obtaining an original signed contract from TMPA is that TMPA did not execute the amendment until a judgment was signed in the declaratory judgment/judicial validation proceeding entitled Ex Parte TMPA, Cause No 97-07872, in the 345th Judicial District Court of Travis County, Texas The Court signed the judgment in that case on November 5, 1997 I am preparing a brief item for this week's status report regarding the above matter Thank you for your assistance Michael S CcIpblallid MSC/cd PC Jack Miller, Mayor (w/attachment) Ted Benavides, City Manager Bob Nelson, Assistant City Manager/Utilities Howard Martin, Director of Environmental Services/Utility Administration Sharon Mays, Director of Electric Utilities (w/attachment) s \shared\docs\cor\power sales contract doe