The Promise of Desalination in Texas Webcast Presented by: Texas Bar - - PowerPoint PPT Presentation

The Promise of Desalination in Texas

Webcast Presented by: Texas Bar CLE January 2014 Speakers: Representative Bill Callegari, Houston State Representative, District 132

• Mr. Phil Steven Kosub, San Antonio

San Antonio Water System Eric S. Petersen, New York, NY Hawkins Delafield & Wood LLP

• Ms. Mary Kathryn Sahs, Austin

Sahs & Associates, PC

http://www.texasbarcle.com/materials/Programs/2914/WebCastInfo.htm#description

Brackish Groundwater Desalination Plant Interior

Brackish Groundwater Production Well

Brackish groundwater reverse osmosis membrane

Brackish membrane groundwater treatment depiction

DBFOM (P3) Contract Structure

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Governmental Owner O&M Contractor DB Contractor Bank/Bonds Equity Investor Special Purpose Vehicle

Project Agreement Service Fee Equity return Equity investment Principal and interest Debt finance O&M Facilities Contract Security Package Construction Contract Security Package

DBFOM (P3) Payment Structure

Under a DBFOM structure, the governmental owner makes an annual Service Fee payment to the Project Company consisting of: 1. A Capital Charge:

a. An amount equal to actual debt service on the Project Company’s debt (based on a design-build price competitively proposed and bonds competitively underwritten) b. An equity return amount (competitively proposed)

2. Operations and Maintenance Charges (competitively proposed) Service Fee payment is performance based: 1. No payment until the plant has passed acceptance tests 2. Deductions for non-performance (including for water quality and availability) 3. Long Term guaranteed performance 4. Equity fully at risk in a project performance default