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RESOLUTION NO.
A RESOLUTION DECLARING THAT THE PURPOSES OF THE DECOMMISSIONING
RESERVE ACCOUNT UNDER THE JOINT OPERATING AGREEMENT BETWEEN THE
TEXAS MUNICIPAL POWER AGENCY AND THE CITIES OF BRYAN, DENTON,
GARLAND, AND GREENVILLE HAVE BEEN ACCOMPLISHED AND APPROVING A
REDUCTION OF THE REQUIRED ACCOUNT BALANCE OF THE DECOMMISSIONING
RESERVE ACCOUNT; AND PROVIDING FOR AN EFFECTIVE DATE.
WHEREAS, the Joint Operating Agreement ("JOA") between the Texas Municipal Power
Agency (the "Agency") and the cities of Bryan, Denton, Garland, and Greenville (the "Member
Cities") requires that proceeds from the sale of the Gibbons Creek Lignite Mine be used for, among
other things, the establishment of an Indemnity Reserve Account having an account balance of $5
million and a Decommissioning Reserve Account having an account balance of $30 million; and
WHEREAS, an Indemnity Reserve Account having an account balance of $5 million has
already been established; and
WHEREAS, the purposes of the Decommissioning Reserve Account are to fund the costs of
decommissioning the Gibbons Creek Steam Electric Station ("Gibbons Creek"), fund the cost of
environmental remediation, and fund the cost of environmental insurance; and
WHEREAS, the purposes of the Decommissioning Reserve Account have been
accomplished through:
(i) the sale of Gibbons Creels to the Gibbons Creek Envirorunental Redevelopment
Group, LLC ("GCERG'), which has assumed all responsibilities relating to the
decommissioning and environmental remediation of Gibbons Creek,
(ii) in connection with such sale, the establishment of an escrow fund with UMB Bank,
N.A. as escrow agent, funded in the initial amount of $28,546,000, to provide for
GCERG's decommissioning costs, and
(iii) also in connection with such sale, the posting of a performance bond by GCERG, to
provide additional security for the decommissioning operations, in the amount of
$36,500,000, and the provision of GCERG of $25,000,000 environmental insurance
policy, naming the Agency and the Member Cities as insureds; and
WHEREAS, because the purposes of the Decommissioning Reserve Account have been
accomplished, the Agency and Member Cities have determined that the required account balance of
the Decommissioning Reserve Account should be reduced to $0.00 to avoid overfunding for the costs
of decommissioning, allowing the funds to be disbursed to the Member Cities; and,
WHEREAS, pursuant to Section 3.2.3(3) of the JOA, the required account balance of the
Decommissioning Reserve Account may be adjusted upon agreement of the Member Cities; and
WHEREAS, the City Council has determined that it is in the public interest to approve the
adjustment to the Decommissioning Reserve Account as indicated herein; NOW, THEREFORE
THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES:
SECTION 1. The findings and recitations contained in the preamble of this Resolution are
incorporated herein by reference.
SECTION 2. The City of Denton approves the reduction of the balance of the
Decommissioning Reserve Account to $0.00.
SECTION 3. The Interim City Manager, or designee, is authorized to send a certified copy
of this Resolution to appropriate officials of the Agency and Member Cities.
SECTION 4. This Resolution shall become effective immediately upon its passage and
approval.
The motion to approve this Resolution was made by v� C e- and
seconded byThe Resolution was passed and approved
by the following vote
Gerard Hudspeth, Mayor:
Vickie Byrd, District 1:
Brian Beck, District 2:
Jesse Davis, District 3:
Alison Maguire, District 4:
Deb Armintor, At Large Place 5:
Paul Meltzer, At Large Place 6:
PASSED AND APPROVED this the
ATTEST:
ROSA RIOS, CITY SECRETARY
BY:
APPROVED AS TO LEGAL FORM:
MACK REINWAND, CITY ATTORNEY
BY:
4 Ll
Ave Nay
Abstain Absent
day of !-� 0 Q f YY1,p gZF - _ . , 2021.
ERARD HUDSPETH, MAYOR