DEPARTMENT: Finance
DEPARTMENT HEAD: Ben Gorzell, Chief Financial Officer
COUNCIL DISTRICT(S) IMPACTED: City Wide
SUBJECT:
Briefing from the San Antonio Water System (SAWS) providing updates on a change in control within the Vista Ridge Project, ongoing customer service initiatives, and initial results of the recently adopted rate structure.
SUMMARY:
On April 7, 2016, SAWS provided a briefing to City Council to update them on a possible change in control from Abengoa Sociedad An?nima ("Abengoa") to Garney P3 LLC, ("Garney"). This briefing will provide a further update on the status of this change in control as well as certain other developments associated with the Vista Ridge project. It will also provide further updates regarding SAWS Customer Service improvements and a summary of the results of the first three full months of billing under the newly adopted rate structure which went into place for usage after the first of the year.
BACKGROUND INFORMATION:
Vista Ridge
On April 7, 2016, SAWS briefed the City Council on the developing request by Abengoa Vista Ridge for a Change in Control to Garney for the Vista Ridge Water Supply Project following various financial difficulties with Abengoa (S.A.), Abengoa Vista Ridge LLC's parent company. Subsequent to this briefing, SAWS has worked closely with Garney to develop a better understanding and comfort level with their Plan of Development and Finance, conducted certain due diligence efforts, and developed improved clarification with regards to certain matters in the Water Transmission and Purchase Agreement ("WTPA").
Additionally, under the terms of the WTPA, SAWS had the ability to lock in a fixed price for the water and infrastructure (Capital and Raw Groundwater Price) on a date first occurring in May 2016. SAWS chose to lock in the price on May 17, 2016. Based on prevailing market interest rates on that date, the project cost will now be reduced significantly (approximately $529 million...
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