The URL can be used to link to this page

Home My Public Portal AboutRES-CC-2016-01Resolution #01-2016 A RESOLUTION APPROVING A MEMORANDUM OF UNDERSTANDING BETWEEN SPANISH VALLEY WATER AND SEWER WATER IMPROVEMENT DISTRICT AND THE CITY OF MOAB WHEREAS, the City has determined that it is in the best interest of the community to enter into a cooperative agreement with Spanish Valley Water and Sewer Improvement District to provide sewer services for Spanish Valley; and WHEREAS, the attached memorandum of understanding provides for the funding and coordination of such services; NOW THEREFORE, WE, THE GOVERNING BODY OF THE CITY OF MOAB DO HEREBY ADOPT THE MEMORANDUM OF UNDERSTANDING IN SUBSTANTIALLY THE FORM PRESENTED TO THIS MEETING OF THE CITY COUNCIL, AND AUTHORIZE THE APPROPRIATE INDIVIDUALS TO EXECUTE AND DELIVER SAID AGREEMENT. This resolution shall take effect immediately upon passage. Passed and adopted by action of the Governing Body of Moab City in open session this 12th day of January, 2016. CITY OF MOAB By: Attest: Rachel E. Stenta City Recorder Mayor Resolution #01-2016 Page 1 of 1 MEMORANDUM OF UNDERSTANDING THIS MEMORANDUM OF UNDERSTANDING (MOU) FOR A FUTURE WASTEWATER TREATMENT SERVICE INTERLOCAL AGREEMENT, is entered into by and between the City of Moab, a Utah municipality (the City), and the Spanish Valley Water & Sewer Improvement District, , a special service district organized and existing pursuant to Utah law (the District). RECITALS a. the City, pursuant to U.C.A. §10-8-38, is authorized to acquire and operate systems for the collection, treatment and disposition of sewage; and b. pursuant to U.C.A. §11-8-1 municipalities and special service districts are expressly authorized to enter into contracts for sewage treatment and disposal services; and c. the City owns, operates, and maintains a wastewater treatment plant which, in addition to being utilized to provide wastewater treatment services for the City, is currently being utilized to provide wastewater treatment services pursuant to the terms of an agreement by and between the City and the Spanish Valley Water and Sewer Improvement District, dated November 10,1982; d. the City and the District desire to enter into a future agreement pursuant to the Utah Interlocal Cooperation Act, U.C.A. §11-13-1, et seq. which will set forth detailed provisions for the expansion of the City wastewater treatment plant and the provision of wastewater treatment services to customers served by the District; and e. this MOU is intended to identify the points of agreement between the parties and set forth the outlines of a future Interlocal Agreement (the Agreement) which will be negotiated and executed no later than July, 2016. 1. Project Scope. The City has undertaken planning for the construction of a new wastewater treatment plant which will have a capacity of 1.5 million gallons per day (MGD), and a 1.75 MGD peak monthly capacity. The new plant will be constructed on a site to be acquired by the City on 400 North in Grand County. a. The new plant will be designed as a Sequenced Batch Reactor (SBR) plant with the capability of handling wastewater and septage containing higher intensity biochemical oxygen demand and total suspended solids. b. The total project cost is estimated to be $10 million to $11 million. The City will undertake bond financing from the Utah Department of Environmental Quality (DEQ) to fund the construction of the project. 2. Regional Plant. The parties recognize the necessity of constructing a new wastewater treatment plant, and the advantages of cooperating in the construction of a 1 single plant. The parties understand that construction of a regional plant may preclude other alternatives within the foreseeable future. The City intends to own the new plant, which will be operated as a regional facility. The Agreement will provide that both the City and the District will make substantial proportionate contributions to the construction and operation of the plant. Therefore, the Agreement will contain detailed terms providing that the District will be entitled to utilize a proportionate share of the new plant capacity for the service life of the plant, together with the option to purchase additional capacity. As a result, entities receiving wastewater treatment services under the future Agreement will pay their proportionate share of costs for construction, operation, maintenance, and expansion of the capacity of the plant. The Agreement will contain provisions for the District to pay its proportionate share of any other unforeseen costs associated with plant operations and maintenance. 3. Allocation of Capacity. Treatment capacity will be allocated on a first -come, first - first served basis, and will be calculated based upon Equivalent Residential Units (ERUs). Septage haulers currently utilizing the system will be allocated capacity on an ERU basis. 4. Duration of Future Agreement. The duration of the Agreement between the City and the District will be equal to the service life of the new plant (including subsequent expansions). The Agreement will have provisions for re -negotiation and extension as needed to accommodate growth, the need for future wastewater treatment capacity, and other unforeseen events. 5. Moratoria in Case of Future Environmental Violations. Currently the City is meeting applicable water quality standards enacted by the DEQ. However, continued growth during the period prior to completion of the new plant could result in environmental violations issued by the DEQ and/or United States Environmental Protection Agency (EPA). The Agreement will provide that, in the event of future environmental violations, the City and the District will implement moratoria on new sewer connections as necessary. 6. Planning for Service Areas. The City and District will negotiate a service area as part of the Agreement, which will encompass existing City and District service boundaries, and may encompass additional service areas in San Juan County. The Agreement will also provide for future service area expansions upon the agreement of all parties. 7. Uniform Sewer Standards. The City and the District will cooperate in enacting uniform sewer standards governing materials, connections, and treatment standards. Under the Agreement the City and the District will implement these standards with respect to all customers in their respective jurisdictions. 8. Periodic Rate Study. The City will undertake a rate study no later than three (3) years from the effective date of the Agreement. Additional rate studies will be conducted every five (5) years. 2 9. Impact Fee Collection. The Agreement will provide that all new connections to the wastewater treatment system will pay impact fees, which shall be collected by the City within its boundaries and the District within its boundaries. The District will remit all collected impact fees to the City periodically, and the City shall hold same in its wastewater treatment facilities account. Impact fees will be due and payable at the time a building permit is issued for new development. The District and the City will implement impact fee procedures which will address increased capacity for City collection pipelines to the extent those improvements are needed due to development outside the City. 10. Capital Contribution and Recoupment. To reduce the total indebtedness associated with the project, the Agreement will provide for capital contributions to be made by each party, in amounts to be determined. The capital contributions in the Agreement will be proportionate to the total capacity of the existing wastewater treatment system now utilized by each party. For example, assuming a total capital contribution of approximately $2 million, and City and District usage of capacity of 60.1% and 26.5V, respectively, then the City contribution would be $1.36 million and the District contribution would be $600,000.00. If the District is unable to contribute an amount equal to its proportionate system usage, the Agreement will provide for recapture of the deficit capital contribution over time, with interest accruing at the same rate provided for the bonded indebtedness undertaken by the City for the system improvements (estimated to be two percent per annum). The Agreement will contain detailed provisions for collection of these sums by the District. 11. Allocation of Current Capacity. Existing capacity shall be allocated between the City and the District based on the total ERUs currently utilized by each entity. The Agreement will provide for service rates, which shall include a treatment portion and a transmission portion. The rates will cover costs of planning, construction, operations and maintenance, and debt service over the life of the project. District customers will pay the treatment portion as well as a portion of the City transmission costs to account, for example, for pipelines maintained by the City which serve District customers. The District will administer its rate structure and be responsible for remitting its share of service revenues to the City periodically. Future service rate increases which may be adopted by the City must be equitable as between City and District customers. 12. Planning for Future Agreements. The Agreement will provide that the parties will begin planning for additional capacity no later than the point at which eighty five percent (85%) of available capacity has been consumed. 13. Enforcement. The Agreement will contain enforcement mechanisms, which may include specific performance (i.e. injunctive relief), damages (as in the case of non-payment of impact or service fees), moratoria, and/or termination, interest, and attorney fees, as applicable. 1. Note that total capacity usage does not equal 100% because the existing treatment plant devotes significant capacity to the treatment of septage delivered by waste haulers. Future rates for septage discharge will also address these system impacts. 3 14. Deadline for Final Agreement; Additional Parties. The parties will continue negotiations and work diligently towards the completion of a final interlocal agreement, which will be adopted by the parties no later than July 15, 2016. The parties will confer and, to the extent necessary to fully implement the terms of the Agreement, additional parties may be added to the final Agreement. It is intended that this MOU will be terminated upon the adoption of the final Agreement. In the event that no final Agreement is reached between the parties, this MOU shall be void and of no further effect. 15. No Interlocal Entity Created; Advisory Board. The Agreement will not provide for the creation of a separate interlocal entity. However, the Agreement will contain provisions for the creation of an advisory board comprised of representatives of both entities. The Agreement will specify regular meetings of the board for the purpose of wastewater planning and inter -agency cooperation. While the board will not have governing authority, it will be authorized to make recommendations. 16. Dispute Resolution. Because the parties anticipate the importance of continuing interlocal cooperation, the Agreement will have detailed provisions providing for resolution of disputes, which will include, at minimum: a) written notice and an opportunity to cure any breach or threatened breach; and b) mediation as a condition precedent to invoking judicial remedies (except in the case of immediate or irreparable injury). -Remainder of Page Intentionally Left Blank- 4 MEMORANDUM OF UNDERSTANDING FOR A FUTURE WASTEWATER TREATMENT SERVICE INTERLOCAL AGREEMENT, SIGNATURE PAGE Approved by the parties on the date(s) set forth below: City ooab: By: I-as-tl,0 David Sakrison, Mayor Date Attest: By: Rachel Stenta, Recorder Date Spanish Valley Water & Sewer Improvement District: l 0 CD - Q.v Gary Wilson, Chairman Date Attest: / By: /%% r�C/i<F°, Mike Holyoak, Clerk Date 1 ce -End of Document- 5