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HomeMy WebLinkAboutContract 37140 AGREEMENT REGARDING WATER AND WASTEWATER UTILITY SERVICE This Agreement Regarding Water and Wastewater Utility Service ("Agreement ') is entered into by and between the City of Fort Worth, Texas (the "CC"), a home-rule municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas, acting by and through its duly authorized Assistant City Manager; Aqua Utilities, Inc., formerly known as AquaSource Utility, Inc., a Texas corporation ("Aqua Utilities"); Aperion Communities, LLLP, Eladio Properties, LLLP, Drooy Properties, LLLP, Rocksand Investments, LLLP, Justin Ranch 427, LLLP, and Justin Ranch 123, LLLP, all Arizona limited liability limited partnerships (individually and collectively, "Owner'); and Tradition Municipal Utility District No. 2 of Denton County, a municipal utility district created pursuant to Article XVI, Section 59, of the Texas Constitution, Chapters 49 and 54 of the Texas Water Code and the applicable Special District Local Law and any other district created over the Development by dividing the District into one or more new Districts pursuant to the District Legislation (the "District"), which District, after the District Confirmation Date (or, for any later created District, the date the election dividing a District is held pursuant to § 8189.104 of the District Legislation), will become a Party to this Agreement. ARTICLE I RECITALS A. Owner is the developer of an approximately 2,660 acre master-planned community known as"Tradition,"and depicted for informational purposes only on the attached Exhibit A. B. Owner has commenced development of that certain 431.303-acre tract, identified as Phase I on Exhibit A ("Phase I'), as the first phase of Tradition. C. Owner also intends to develop the approximately 1,922.737 acres in Denton County, Texas, identified as the Development on Exhibit A and described in Exhibit B attached to this Agreement(the"Development'). The Development lies entirely within the City's extraterritorial jurisdiction (`ETJ"). Owner intends the Development to be the second phase of Tradition. D. The Development and Phase I are located within the extraterritorial jurisdiction ("ETJ") of the City and the remaining approximately 307 acres of Tradition are located within the ETJ of the Town of Northlake. E. In conjunction with Owner commencing development of Phase I, the City, Owner and Aqua Utilities entered into that certain Superseding Agreement Regarding Water and Wastewater Utility Service, dated effective December 21, 2005, (the "Superseding Agreement") which applies to Phase I and which contains certain provisions that also apply to the remaining portions of Tradition. F. Owner petitioned the Texas Legislature to form a Municipal Utility District to encompass the Development and thereafter the Texas Legislature approved the creation of Tradition Municipal Utility District No. 2 of Denton County, by Act of May 23, 2007, 80th Legislature, Agreement Regarding Water and Wastewater Utility Service Page I Page 1 of 3 City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION: Approved on 12/18/2007 - Res. No. 3568-12-2007 DATE: Tuesday, December 18, 2007 LOG NAME: 06TRADITION2 REFERENCE NO.: C-22589 SUBJECT: Authorize Execution of the Consent Resolution, Development Agreement, Buy-Out Option Agreement, Impact Fee Agreement, Utility Agreement, Wholesale Wastewater Service Agreement, and the Agreement for the Sale of Treated Water and Approve the Form of the Strategic Partnership Agreement for Tradition Municipal Utility District No. 2 of Denton County RECOMMENDATION: It is recommended that the City Council: 1. Adopt a resolution consenting to the creation of Tradition Municipal Utility District No. 2 of Denton County ("District"); 2. Authorize the City Manager or a designee to execute the following contingent upon receipt of necessary executed documents from Aqua Utilities: a. A Development Agreement between the City and Aperion Communities, LLLP, Eladio Properties, LLLP, and Drooy Properties, LLLP, and Rocksand Investments, LLLP; b. A Buy-Out Option Agreement between the City, Aqua Utilities, Aperion Communities, LLLP, Eladio Properties, LLLP, and Drooy Properties, LLLP, and Rocksand Investments, LLLP, and the District; c. An Impact Fee Agreement between the City, Aqua Utilities, Aperion Communities, LLLP, Eladio Properties, LLLP, and Drooy Properties, LLLP, and Rocksand Investments, LLLP, and the District; d. A Utility Agreement between the City and Aqua Utilities, Aperion Communities, LLLP, Eladio Properties, LLLP, and Drooy Properties, LLLP, and Rocksand Investments, LLLP, and the District; e. A Wholesale Wastewater Service Agreement between the City and Aqua Utilities; f. An Agreement for the Sale of Treated Water between the City and Aqua Utilities; and 3. Authorize the City Manager or a designee to bring forth the Strategic Partnership Agreement for approval after the formation of the Municipal Utility District. DISCUSSION: Aperion Communities, LLLP, Eladio Properties, LLLP, and Drooy Properties, LLLP, and Rocksand Investments, LLLP, (AEDR) are Arizona limited liability partnerships that own and are developing approximately 2,663 acres in Fort Worth's and Northlake's extraterritorial jurisdiction as a mixed-use development to be known as "Tradition." The property is in Denton County and is located north of Highway http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 5/28/2008 Page 2 of 3 114 and west of Highway 156. On December 13, 2005, (M&C C-21198) the City Council authorized the City Manager to enter into contracts for the first 431 acres of this development known as Tradition Municipal Utility District No. 1 of Denton County. The district was confirmed by the voters on May 12, 2007. On September 12, 2006, (M&C G-15392) the City Council granted conditional consent to Tradition Municipal Utility District No. 2 of Denton County in response to a petition submitted by AEDR. The intent was to allow the creation of a "master MUD" that would subsequently be subdivided into smaller tracts consistent with their development phases. During the 2007 legislative session, H.B. 3182 was approved and authorized the creation of this district consisting of 1,922.737 acres subject to adoption of a consent resolution by the Fort Worth City Council. The attached resolution grants formal consent to the formation of the District and specifically grants to the District the authority to finance road projects. In addition, it grants the City Manager the authority to execute the "Agreement Concerning Creation and Operation of Tradition Municipal Utility District No. 2 of Denton County" (the Consent Agreement). This is the contract between the developer, the District, and the City governing the issuance of bonds, the construction standards for infrastructure, and the terms of future annexation. The other documents listed above, which are available for public inspection and copying in the City Secretary's Office, can be summarized as follows: The Development Agreement provides for the enforcement of municipal building codes and establishes land use and development regulations for the Development. In addition, it imposes Special Regulations to govern design issues such as block lengths and street right-of-way and sidewalk widths. The Development will generally be in compliance with development standards within the City limits. The Agreement also identifies enhancements beyond the City's regulations in terms of amenities, entry features and landscaping. The remaining five agreements identified as items b through f above relate to the provision of water and wastewater facilities and service to the Development. Aqua Utilities is the holder of the Water Certificate of Convenience and Necessity (CCN) in the Development and are therefore party to several of the agreements. Aqua Utilities will provide retail water and wastewater service to the Development. The City will provide wholesale water service through a wholesale contract similar to those with our customer cities. The provider for wholesale wastewater service is still under negotiation. The goal of the City and the Developer is to partner with Trinity River Authority (TRA) and install a new interceptor line from the existing TRA wastewater treatment facility at Denton Creek. If this occurs, the City will provide wholesale wastewater service to Aqua Utilities through a wholesale contract and a TRA interceptor line agreement will be brought to City Council for consideration. If the negotiation of TRA interceptor option is unsuccessful, the Developer intends to build a package treatment plant to be operated by Aqua Utilities. The Impact Fee Agreement will allow the City to recover the treatment, pumping and other infrastructure costs associated with providing water and wastewater service to the Development. Under the Buy-Out Option Agreement the City has the option to purchase the water and wastewater facilities in the Development from the District for $10 and become the retail water and wastewater service provider. This can occur at anytime after 17 years of the first connection to retail water or wastewater utility service within a District, or within 90 days before the date of annexation of a District by the City. Aqua Utilities will agree not to contest the application of the City for the CCN for the area within that District. The Strategic Partnership Agreement will authorize the City to annex acreage within the Development designated for commercial development for the limited purpose of imposing sales and use tax. This agreement will be presented to the City Council with the appropriate public hearings after the district is http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 5/28/2008 Page 3 of 3 formally established by election. This Development will not require the expenditure of City funds or the collection of offsetting revenue for wholesale services for several years. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that approval of these Agreements will have no immediate material effect on City funds. Any effect on expenditures and revenues will be budgeted in future fiscal years. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office by: Dale Fisseler (6140) Originating Department Head: Fernando Costa (8042) Additional Information Contact: Susan Alanis (8180) http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 5/28/2008 Page 1 of 1 City of Fort Worth, Texas Mayor and Council Communication COUNCIL ACTION: Approved on 1/29/2008 DATE: Tuesday, January 29, 2008 LOG NAME: 06TRADITIONCORR REFERENCE NO.: **C-22640 SUBJECT: Correction of Mayor and Council Communication C-22589, Adopted on December 18, 2007, to Add Two Limited Partnerships, Justin Ranch 427, LLLP, and Justin Ranch 123, LLLP, as Parties to the Tradition Municipal Utility District No. 2 Contracts and the Consent Resolution and Authorize the Execution of the Corrected Consent Resolution and Contracts RECOMMENDATION: It is recommended that the City Council approve the correction of Mayor and Council Communication C- 22589, adopted on December 18, 2007, to add two limited partnerships, Justin Ranch 427, LLLP, and Justin Ranch 123, LLLP, as parties to the Tradition Municipal Utility District No. 2 contracts and the consent resolution and authorize the execution of the corrected consent resolution and contracts. DISCUSSION: On December 18, 2007, (C-22589) the City Council approved the Consent Resolution and authorized the execution of the the Development Agreement, Buy-Out Option Agreement, Impact Fee Agreement, Utility Agreement, Wholesale Wastewater Service Agreement, and the Agreement for the Sale of Treated Water and Approve the Form of the Strategic Partnership Agreement for Tradition Municipal Utility District No. 2 of Denton County. After City Council approval of C-22589, the developer notified the City that two additional parties needed to be added to the contract. Adoption of this correction Mayor and Council Communication will authorize the addition of the two necessary parties, Justin Ranch 427, LLLP, and Justin Ranch 123, LLLP, to the Consent Resolution and the contracts. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that this action will have no material affect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manager's Office by: Dale Fisseler(6140) Originating Department Head: Fernando Costa (8042) Additional_Information Contact: Susan Alanis (8180) http://apps.cfwnet.org/council_packet/Reports/mc_print.asp 5/28/2008