Consider and take action on Amendment No. 1 to the Agreement with Valero Refining-Texas, L.P. regarding the option to purchase treated wastewater effluent from the City of Texas City to extend the term of the Agreement to December 31, 2025.

On June 8, 2020, the City of Texas formalized an agreement with Valero Refining - Texas, L.P. The agreement granted Valero a five (5) year non-exclusive option to purchase treated wastewater effluent for various approved uses as specified in 30 TAC Chapter 210 such as cooling tower make-up water.  Valero exercised the option by notice provided on August 29, 2024, and the parties have been working diligently to negotiate terms and draft an agreement for the purchase of treated wastewater effluent and the lease of property necessary to construct facilities to deliver the treated wastewater to the Valero refinery in Texas City. The option agreement expires by its terms on June 8, 2025.  The parties need additional time to complete the drafting and approval of the agreement and to complete the process for the leasing of the necessary property.  An extension of the option agreement until December 31, 2025, is requested for this purpose.  

The City Engineer recommends approval of Amendment No. 1 to the existing Agreement for the option to purchase treated wastewater effluent between the City of Texas City and Valero Refining - Texas, L.P. This amendment will extend the term of the existing option agreement to December 31, 2025, to allow the parties more time to complete the drafting of a purchase agreement and related documents.