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Home My WebLink AboutRES 23-047RESOULTION NO. 23-047 BE IT RESOLVED BY THE CITY, COUNCIL OF THE CITY OF BEAUMONT: WHEREAS, the Southeast Texas Groundwater Conservation (District) is limited to a maximum production of one:(1) cent per 1,000 gallons and the. District is currently at their maximum production fee; and; WHEREAS, while the District is not intending to raise the fee, they need the maximum rate increased to allow for that possibility in the future. NOW THEREFORE, BE IT FURTHER RESOLVED BY THE CITY COUNCIL OF. THE CITY OF BEAUMONT: THAT, the City Manager be and he is hereby authorized to send a letter supporting a maximum rate increase for the ' Southeast Texas' Groundwater Conservation District to .Senator Nichol's office by February17, 2023. The meeting at which .this resolution was approved was in all things conducted in strict compliance with the Texas Open Meetings Act, Texas Government Code, Chapter 551. PASSED BY THE CITY COUNCIL of the City of Beaumont this the .31st day of January, 2023. _„ - Mayor Robin Mouton SOUTHEAST TEXAS PRESIDENT VICE PRESIDENT GROUNDWATER SEC /TREAS CONSERVATION DISTRICT P.O. BOX 1407 JASPER, TEXAS 75951 January 19, 2023 Troy Pierce, Superintendent of Water Production City of Beaumont. 1550 Pine Street Beaumont, TX 77703 VIA EMAIL: troy_pierce@beaumonttexas. og_v RE: Legislative Amendment To District Act Dear Mr. Pierce, GENERAL. MANAGER GENERAL COUNSEL ROGERFUSS_ELL OLEN BEAN BOBBY ROGERS SAM ASHWORTH KEN JOBE THOMAS HAWIHORNE CODY JONES GREG KELLEY RICK RUSSLER BILLY TED SMITH ROBB STAR WENDYTURNER M. CHARLES ZIMMERM JOHNMMARTIN JOHN D. STOVER As you are aware the Southeast -Texas Groundwater Conservation District (District) has been managing the groundwater within the District for nearly 20 years.. The District consists - of Jasper, Newton, Hardin, and Tyler counties and is the llth largest groundwater district in the state. Since its inception in 2003 the District lids operated with only 1 full-time employee, and just recently raised the production fee for the first time in nearly 20 years, 'even as the State has added unfunded mandates with which we must comply. The required Groundwater Management . . Area Desired Future . Conditions (DFCs) .planning process alone costs the District thousands of. dollars each year. When the District was created, it was done so with a production fee cap of 1 cent per 1,000 gallons pumped. At that time, it, was. thought this this would be sufficient. for decades, 'and it. has, been; however, Texas continues to experience incredible.growth which heavily impacts groundwater resources. In addition to. the ' added requirements of Chapter 36 of the Texas Water Code, all categories of expenses have increase significantly. Our District finds itself walking a: very fine line with regard to managing the aquifer in a way sufficient to protect the groundwater resources and to meet all 'of our -expenses in'a financially sound manner. We learned just how fine a line we were walking when Hurricane Harvey took out the City's three wells. This reduced the District's revenue by approximately 15% each year. Only because the District has been operating in a very financially conservative manner was it was able to "weather the storm". The District's Board of Directors has recently determined that it is time .to bring a second employee on board to help meet all the demands required to successfully manage our District.. and groundwater. resources. To that end, the District, for the first time in 19 .years; has raised its production fee three hundredths .of a cent .(o.003) per 1,000 gallons. Not too many entities, P. a Box 1407 Jasper, Texas 75951 (409)"383-1577 Fax. (409) 383-0799 wives. setgedorg -------------- Exhibit "A" private or public, can. say that they have gone 19 years without a fee increase and that when it did raise its fee, it only went up 0.003 cents per 1,000 gallons. As stated earlier,, the District is limited to a maximum production fee of 1 cent per 1,000 gallons. Since we are now afthat 1 cent amount, if we should we need to increase our production fee we would be unable.to do so. The District has no intention of raising the fee again anytime soon. (after all, we did go 19 years without a fee increase) but the City, our 2nd -largest producer, being offline for. 3 years showed us that change 'is required. If there is another. significant drop in groundwater production or if the District's largest producer (the Evadale papermill), were to reduceproduction or shutdown completely, the District would not beable to pay the cost of effectively manage the District's: groundwater resources. We have begun working with Senator- Nichols' office to have our 'Act amended to: raise the maximum production fee to 7 cents per 1,000 gallons, and we are asking for your support in this endeavor. The District has met with each of the four county commissioner's courts who have all agreed to support the District, and we are now looking for support from our actual producers. Again, please note that there are no plans for a fee increase anytime soon and that 7 cents is. a worst case scenario that would replace all of the lost revenue should our largest producer stop completely. The maximum production fees for nearby groundwater districts range from 2.5. cents per 1,000 gallons (Pinewoods GCD —which is a district half the size of ours) to 17 cents per 1,000 gallons, and some districts in the state range as high as 30 cents per 1,000 gallons. What would the cost be to your customers? We estimate that a. household uses 5,000 gallons per house, per month. Increasing the fee by 6 cents (for a total of 7 .cents) would result in a 30 cents per household increase per month. We understand that this is an oversimplification as there is :. water that is used for flushing and leaks that do not register on the billable water meters, but it is a good place to start to examine what the impacts might be. We do not ask this lightly; however, we would be very grateful if you would consider supporting our efforts by providing a letter that we can forward to Senator Nichols'- office showing that you understand the importance of groundwater management and support, or at least won't oppose the District's request to increase the maximum production fee. - As. the Texas Legislature only meets for 5 months every other year, time is of the essence. After consideration, please provide a response no later than February 17, 2023. - - . If you have any questions or comments, please do not hesitate to contact us. P.O. Box.1407 Jasper, Texas 75951 (409) 383-1577 Fax. (409) 383-0799 www. setgcdorg 3 Current GCD Fees and Maximum Allowable, Fees:.. 35 .. .. - . 30 m _ 25-- 0 20' cu . 15, — u 10'J7 — +,a 00 e. ,k .. - �Q .. �p yS :. �0 Current Fee is Fee AmendmenfRequestAmount," "Maximum"Allowable • The Southeast Texas Groundwater Conservation District (SETGCD) was created in 2003 and consists of four counties (Jasper, Newton, Hardin, and Tyler). • " Of the 101 groundwater district in the state, the SETGCD is estimated to be the 11th largest (inclusive of the:two. subsidence districts and the Edwards Aquifer Authority). • The SETGCD has only 1 full time employee and no part-time employees. • For the first time; and only recently, the SETGCD has increased its production fee: It was at 0.007 cents per 1,000 gallons for 19 years. The increase took effect during the last quarter and is now 1 cent per 1,000 gallons. • Due to pumping fluctuations, the District's annual revenues over the past 10 years has ranged between $133,000-and $165,000. The average for the period between 2017 and 2,021 has been $140,160, which is down approximately 10% from the previous 5 year period.. • The District:has two large groundwater producers providing_ between 65%.and 75% ofthe District's revenue each year. • Any remarkable reduction in pumping can significantly. impact the District's budget. • - Groundwater Conservation Districts are the State's preferred method of groundwater management. • Without a groundwater district in place groundwater management defaults to the "rule of capture,' which is essentially no management of the resource. - • The rule of capture -allows for -wells to be drilled essentially anywhere, capable of.any amount,, as long as the water is being put to good use, even if the well causes severe impacts to the . surrounding water wells. Texas Law provides that as long as the water was being put to good use, the affected parties have no recourse. • The State, by way of Chapter 36 of the Texas Water Code, also requires regional management of . the groundwater resources by way Groundwater Management Areas (GMAs). There are twenty counties in southeast Texas that are in GMA 14. • GMA 14 is in one of the fastest growing areas of the country. Proper management -of the Gulf Coast Aquifer is critical. John Martin General Manager Southeast Texas Groundwater Conservation District PO Box 1407 Jasper, Texas 75ySl Dear Mr. Martin: Thank you fortaking the time to come and presentto council your request for increasing the current production fee cap of l cent perl,OOO gallons pumped for the Southeast Texas Groundwater Conservation District. Council passed Resolution 23'047 in support of raising the production fee cap to 7 cents per1,OOO gallons asyou outlined inyour presentation tncouncil. I've attached Resolution 23-047 for documentation ofour support for your request tothe Texas Legislature in the upcoming session. Sinoemky, Kenneth R.Williams City Manager — City of Beaumont Office n[the City Manager ^ (409)88U-}708°Fax (4U9)O80-3ll% P.O. Dor]827 m Beaumont, Texas 77704`3827 RESOULTION NO.23-047 BE-IT"RESOLVED BY THE CITY, COUNCIL OF THE CITY OF BEAUMONT: WHEREAS, the Southeast Texas Groundwater Conservation (District) is limited to a maximum production of one:(1) cent per 1,000-gallons and the. District is currently. at their maximum production' fee; and; WHEREAS, while the -District is not intending to raise the. fee, they need the maximum rate increased to allow for that possibility in the future. :. NOW; THEREFORE, BE IT FURTHER RESOLVED BY THE - CITY COUNCIL OF. THE CITY OF BEAUMONT. THAT, the - City -Manager be and he is hereby authorized to send a letter E supporting a' maximum rate increase for the " Southeast Texas' Groundwater Conservation District to .Senator Nichol's office by February 17.; -2023. = The meeting at which .this resolution was approved was in all things conducted in strict compliance with the Texas. Open Meetings Act, -Texas-Government Code, Chapter = 551-. . PASSED -BY THE CITY COUNCIL of the City of Beaumont -this the .31 st day_ of January, 2023. Mayor Robin Mouton