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HomeMy WebLinkAboutContract 6012 �•� CONTRACT FOR WATER SERVICE CITY SECRETARY ��.�" BETWEEN THE CONTRACT, No... .,....� CITY OF FORT WORTH, TEXAS AND THE �� "� .. CITY OF HURST, TEXAS THE ST T TEXAS X COUNTY OF TARRANT X THIS CO TRACT AND AGREEMENT made and entered into this ,� day of C' 19 Q by and between the City of Fort Worth, a mufilcipal corporation located in Tarrant County, Texas, acting by and through its duly authorized mayor, DeWitt McKinley, and the City of Hurst, a municipal corporation located in Tarrant County, Texas, acting by and through its duly authorized mayor, C. A. San'.-,rd. W I T N E S S E T H : WHEREAS, the City of Fort Worth has provided at its own expense, and now owns, operates and maintains facilities for processing and distri - buting a large supply of surface water, and at the present time is qualified to furnish and deliver treated water, both within and without the corporate boundaries of the City of Fort Worth ; and, WHEREAS, the City of Hurst has provided at its own expense and now owns, operates and maintains an underground water supply system and a dis- tribution system; and, WHEREAS, the underground supply system of the City of Hurst is expected in the future to be unable to meet the total needs of its residents ; and, WHEREAS, it is deemed to be in the best interest of both the City of Fort Worth and the City of Hurst that said cities do enter into a mutually satisfactory agreement by means of which the City of Hurst may obtain a supply of treated water at a reasonable rate; and, WHEREAS, by the execution of this contract, neither the City of Fort Worth nor the City of Hurst will surrender any of its rights to the ownership and operation of its present water production and distribution facilities ; NOW THEREFORE, KNOW ALL MEN BY THESE PRESENTS : That for and in consideration of the execution and performance of the mutual covenants herein set forth, the City of Fort Worth and the City of Hurst do hereby covenant and agree as follows : -1- of Hurst at its expense in accordance with plans and specifications approved by the City of Fort Worth. All such meters, devices and equipment shall be operated and maintained by the City of Fort Worth, with the City of Hurst paying to the City of Fort Worth the cost of necessary repairs and replace- ment. The cost of meter reading, testing and adjusting, the charges for transmitting and receiving data, and the costs of charts and minor main- tenance shall be paid by the City of Fort Worth. The point of delivery of treated water by the City of Fort Worth shall be the point of connection between the 18-inch main to be constructed by the City of Hurst and the 33-inch transmission main owned by the City of Fort Worth located south of the Rock Island Railroad. All necessary mains and distribution facilities from and beyond said point shall be furnished, installed, owned, operated, and maintained by the customer, the City of Hurst, except that meters shall be operated and maintained as specified herein. The location of each meter shall be mutually agreed upon bye M'� u and between the parties hereto, and the meter or meters shall not be moved or relocated except by mutual consent. The location of each meter shall coincide as nearly as is reasonably possible with the Fort Worth city limit line. The meter first employed shall be located as shown on the map attached hereto marked ''Exhibit All and expressly made a part hereof. Each city shall have the right to test the meters and flow con- trollers at any time, by first giving the other party notice of its intention to make such a test. No meter shall be adjusted, changed or tested, in place or elsewhere, without giving notice to the other party of this intention to make such a test, and thereafter giving reasonable opportunity to the other party to have representatives participate in such test, change or adjustment . For these purposes, the meter and con- trol equipment will be properly sealed, and the seal shall not be broken except in the presence of representatives of all parties or following due notice to all parties . The City of Hurst or the City of Fort Worth at its own expense may install a check meter to check measure the volume of water passing through the master meter, provided that if such check meter is installed, the same rules and regulations relative to its operation, maintenance, and reading shall apply as to the meter being tested. -3- 1 f ' 3• METER READING AND_ BILLING The City of Fort Worth will read all meters provided for herein at monthly intervals and the parties to this agreement shall have free access to read these respective meters daily, if either party so desires . It shall be the duty of the parties to give immediate notice, each to the other should any meter be found not functioning, and upon such notice repairs to such meter shall be made promptly. Whenever it is evident that a meter has not regis- tered accurately for a period of time, the quantity used shall be estimated in accordance with the usage under similar conditions for equal period. The meter readings and rates of flow shall be added together when more than one meter is in service and the sum thereof shall be used for the purpose of calculating charges for water used. A review of water usage amounts by the customer for the past twelve (12) months shall be made during the preparation of the September bill each year. The September statement shall be prepared so as to reflect any and s all rates of use charges which have not been previously billed and paid. A copy of the rate of flow charts or other records showing the maximum day and the peak hour of the year shall be furnished to the customer with the September billing. The City of Hurst agrees to appropriate annually sufficient funds to pay the monthly charge for water service. The water charge to be paid by the City of Hurst to the City of Fort Worth shall be deemed a current expense of the City of Hurst for each year of this contract as such monthly charges become due and payable. The monthly bill shall be due and payable at the office of the Fort Worth Water Department on or before the i5th day immediately succeeding the monthly billing date. 4. DEFINITIONS "Annual consumption" is the total quantity of water purchased under the terms of this contract by the City of Hurst during the fiscal year of the City of Fort Worth as determined by the difference in the annual Septem- ber meter readings. "Average daily use" is the annual consumption divided by 365. "Maximum day usage" is the maximum quantity of water used during one calendar day of the fiscal year of the City of.. Fort Worth. "M.G.D." is million gallons per day. 1°G.P.D." is gallons per day. "T.G.P.D." is thousand gallons per day. -4- M 1 '� A "Fiscal Year" is the fiscal year of the City of Fort Worth from October 1 to September 30. "Maximum hour rate" or the "peak hour rate" is the quantity of water used during the one hour of the year when more water passed through the meter or meters serving the customer than during any other hour of the fiscal year of the City of Fort Worth multiplied by 24. "Commodity charge" is that part of the rate charged per 1 ,000 gallons used, regardless of rate of use. The commodity charge shall include the maintenance and operation cost, the capital facilities cost on the part of the production and transmission system related to annual use and the raw water costs . "Raw water charge" is a part of the commodity charge and represents the rate per 1 ,000 gallons charged by the Tarrant County Water Control and Improvement District No. 1 to the City of Fort Worth for raw water to be sold to the City of Hurst plus 16% of said rate representing Fort Worth water system losses. "Rate of use charge" is the fixed annual charge determined for the maximum day and the maximum hour rates of use. "Base rate" is composed of the commodity charge, and the rate of use charge. 5 RATES 1 . Method of rate determination The annual rate charged by the City of Fort Worth for rendering water service under the terms of this contract shall be based upon the functional distribution of the total annual cost incurred in furnishing treated water to its customers, provided that nothing herein shall be con- strued as contemplating an annual rate of less than the regular City of Fort Worth water only rate, plus 10 per cent of said rate. 2. Rates to be used The annual rate to be charged for water shall include the proper proportionate parts of the maintenance and operation cost as related to the production and transmission facilities of the total Fort Worth Water System, the capital facilities cost (fixed charges) on the production and transmission plant related to the rendition of service at maximum withdrawal rates of use by the City of Hurst and the raw water costs. The charges for the initial period of the contract which shall ter- minate September 30, 1972, have been computed to be as follows ; a. The commodity charge shall be 14.4 cents per 1 ,000 gallons withdrawn by the customer. b. The annual rates of use charges for maximum day usage shall -5- be $15,810 per M.G.D. and maximum hour rate of usage in excess of the maximum day shall be $7,070 per M.G.D. C. The service charge shall be $25.00 per month per meter. 3. Adjustment of rate a. Raw water The amount charged for raw water shall be increased or decreased proportionately when the raw water cost paid by the City of Fort Worth for water available for treatment and sale to the City of Hurst is increased or decreased. At the time of execution of this contract, the rate, including 16% for system losses to the City of Hurst is 5.8 cents per 1 ,000 gallons . The portion of the raw water charge which reflects system losses shall be adjusted in the manner set out in sub paragraph b. below in accordance with actual experience during the preceding period. If the City of Hurst enters the Tarrant County Water Control and Improvement District No. 1 and the raw water rate then being paid by the City of Fort Worth to the District for water furnished under this contract is reduced as a result thereof, the raw water rate then being paid by the City of Hurst to the City of Fort Worth hereunder shall be reduced in the same pro- portion. b. Commodity charge and rates of use charges The rate shall be reviewed and adjusted every five years except that the first such review shall be based on the annual cost of operation for the fiscal years, 1970-71 and 1971-72. The cost related to the production and transmission function of distri- buting treated water to the Fort Worth city limits in wholesale quantities plus a service charge shall be determined in accor- dance with methods herein. Such costs shall be projected through the City of Fort Worth fiscal year 1975 to establish the fair rate for water to be charged during the period October 1 , 1972 to September 30, 1977. The adjusted rate shall be made effective October 1 , 1972. A similar -review and rate adjustment shall be made for each succeeding five-year period for the term of the contract. 6. PAYMENT FOR WATER Payment of charges to the City of Fort Worth for water used by the City of Hurst shall be made as follows : 1 . Minimum annual payment The City of Hurst agrees to pay the City of Fort Worth the annual rate of use charge based on a withdrawal rate of 2,000,000 G.P.D. , the commodity charge for 365,000,000 gallons per year and the service charge per meter. -6- 2. Maximum rate of delivery The rate at which water is withdrawn from the City of Fort Worth system by the City of Hurst shall be regulated by a rate of flow controller, pumps or other approved methods . The rate of withdrawal shall be controlled so that the maximum rate shall not exceed 1 .25 times the "maximum day rate" of withdrawal experienced during the previous year unless the City of Hurst has notified the Director of the Fort Worth Water Department in writing at least six months prior to the date of the anticipated increase in maximum rate of withdrawal and has furnished all pertinent information regarding the proposed increase to the Director of the Fort Worth Water Department and said Director has given his written approval thereof, except that the said Director may waive all notice requirements, if, in his opinion, said notice is not necessary to protect the interest of the City of Fort Worth. 3. Minimum monthly charge For the first 5-year period of the contract, the minimum monthly charge shall be $2,660 for which payment the City of Hurg't\ shall be entitled to withdraw at the rate of 2,000,000 gallons per day. If the City of Hurst is requested by the City of Fort Worth to restrict withdrawal of water in accordance with the terms of this agreement so that the quantity withdrawn per month by the City of Hurst is less than the quantities shown herein for the minimum monthly charge, the minimum charge shall be reduced to the correct charge computed in accordance with the terms of this agreement for the actual quantity withdrawn. 4. Monthly payment The monthly payment shall include the minimum charge plus the commodity charge multiplied by the quantity of water withdrawn from the Fort Worth system during the month plus the meter charge. Such payment shall not be less than the charge calcu- lated for the Fort Worth Water Rate plus 10 per cent plus the added raw water cost for water sold outside the boundaries of the Tarrant County Water Control and Improvement District No. 1 plus $25.00 monthly service charge per meter. 5. Annual payment The actual total annual payment for water by the City of Hurst shall be related to the annual and peak volumes used by the customer during the fiscal year as determined by meters, flow recording devices or other approved methods. The September bill shall reflect any necessary adjustment in the annual payment due to the actual rates of withdrawal from the Fort Worth system. If the initial period of use of water by the City of Hurst under the terms of this agreement is less than a fiscal year, the -7- annual rates of use charges shall be computed in the proportion that the period of use bears to the fiscal year. The method of computation for determining the total annual pay- ment and the September bill is shown using assumed quantities in the two examples as follows ; Example #1 - Under the assumed conditions of usage as listed below the total of the regular monthly payments equals the computed annual payment based on the maximum usage rate. Computations show that no additional payment is required. The total annual payment would be $84,480 and the September billing would be $8 ,420.00. Usage Per Minimum Commodity Monthly Month Month, Gallons Charge Charge Payments October 20,000,000 $ 2,660 $ 2,880 $ 5,54o November 20,000,000 2,66o 2,88o 5,540 December 20,000,000 2,660 2,880 5,540 January 20,000,000 2,660 2,88o 5,540 February 20,000,000 2,660 2,880 5,540 March 20,000,000 . 2,660 2,88o 5,540 April 25,000,000 2,66o 3,6o0 6, 26o May 30,000,000 2,660 4, 320 6,980 June 40,000,0o0 2,660 5, 760 8,420 July 6o,000,000 2,66o 8,64o 11 ,300 August 50,000,000 2,66o 7,200 9,860 Subtotal 325,000,000 $29,260 $46,8o0 $76,o60 September 4o,0o0,0o0 2,660 5, 760 8,420 TOTAL 365,000,000 $31 ,920 $52,56o $84,48o Maximum day for the year 2,000,000 gallons Maximum hour for the year 2,000,000 gallons per day rate Annual Payment Calculation 365,000,000 x $0. 144 = $52,560 2.0 x $15,810 = 31 ,620 12 x $25.00 = 300 Total Annual Payment $84,480 Previous payments, October through August - 76,06o September billing $ 8,420 -8- Example #2 - Under the assumed conditions of usage as listed below the computed annual payment based on the maximum usage rate exceeds the total of the regular monthly payments . Computations show the total annual payment would be $111 ,825 and the September billing would be $16,325, Usage Per Minimum Commodity Monthly Month Month, Gallons Charge Charge Payments October 40,00o,000 $ 2,660 $ 5, 760 $ 8,420 November 30,000,000 2,660 4, 320 6,980 December 30,000,000 2,66o 4,320 6,98o January 30,000,000 2,660 4,320 6,980 February 30,000,000 2,66o 4,320 6,98o March 30,000,000 2,66o 4,320 6,980 April 4o,000,000 2,66o 5,760 8,420 May 4o,000,000 2,660 5,760 8,420 June 50,000,000 2,660 7,200 9,86o July 70,000,000 2,66o 10,080 12, 74o August 70,000,000 2,660 10,080 12, 74o Subtotal 460,00o,000 $29,260 $66,240 $95,500 September 40,0o0,000 10,565 5, 760 16,325 TOTAL 500,000,000 $39,825 $72,000 $111 ,825 Maximum day for the year 2,500,000 gallons Maximum hour for the year 2,500,000 gallons per day rate Annual Payment Calculation 500,000,000 x $0. 144 = $ 72,000 2.50 x $15,810 = 39,525 12 x $25.00 = 300 Total Annual Payment = $111 ,825 Previous payments, October through August - 95,500 September billing $ 16,325 7• EFFECTIVE DATE OF CONTRACT FOR BILLING It will be necessary for the City of Hurst to construct a water transmission main approximately to its corporate limits and to construct a meter installation. The effective date of this contract for billing purposes shall be the fifteenth 0 5th) day of the month in which the meter installation is placed in service by the City of Fort Worth at the request of the City of Hurst. The billing for the first month will be prorated according to the -9- number of days of actual service included in said billing. 8 . LIFE OF CONTRACT The life of this contract shall be for thirty (30) years from the date of execution hereof, and may be renewed upon terms mutually agreeable to the parties hereto. The City of Hurst can assign its rights under this contract to another political subdivision of the State .of Texas only with the prior written approval of the City of Fort Worth and any attempted assign- ment without such prior written approval shall be void. 9 RIGHTS OF WAY The City of Hurst shall grant to the City of Fort Worth such ease- ments and rights of way along public highways or other property owned by the City of Hurst as are appropriate to construct and maintain water mains and facilities within the City of Hurst to furnish water to the City of Hurst. The City of Fort Worth will move such water mains when reasonably necessary upon notice from the City of Hurst at no cost to the City of Hurst. All work done by or on behalf of the City of Fort Worth under this paragraph will be performed in accordance with specifications equal to those applying to work of a similar nature performed within the City of Fort Worth. 10. MUNICIPALITY MAY BECOME PART OF THE TARRANT COUNTY WATER CONTROL AND IMPROVEMENT DISTRICT NUMBER ONE The City of Hurst has not determined to be a part of the Tarrant County Water Control and Improvement District Number 1 at this time but is in noway precluded by this contract from becoming a part of the District at any time in the future. It is understood and agreed that this contract is made subject to the terms of the Cedar Creek project contract between Tarrant County Water Control and Improvement District No. I and the City of Fort Worth 'as\ it now Mail exists or may hereafter be amended. If the Tarrant County Water Control and Improvement District No. 1 is required to levy ad valorem taxes to support its Cedar Creek project or other additional raw water supplies, the City of Hurst shall pay to the City of Fort Worth for water purchased under this contract an additional raw water charge on such basis as the Tarrant County Water Control and Improvement District No. 1 and the City of Fort Worth shall determine to be ratable, considering the proportion of raw water sold by the Tarrant County Water Control and Improvement District No. 1 for use outside the boundaries of said district and for use inside such boundaries. The intention of the preceding paragraph is that in the event a tax is levied within the Tarrant County Water Control and Improvement District No. 1 to support the Cedar Creek project, the water rate to the City of Hurst shall be increased so that additional revenue from the City of Hurst will bear the same relationship to the amount of water used in Hurst as the additional revenue raised by taxation within the District bears to the amount of water -10- used within the District. The additional raw water charge for water purchased hereunder during the calendar year shall be reflected on the December bill from the City of Fort Worth to the City of Hurst and shall be paid with the December bill . The City of Fort Worth agrees to transmit such additional raw water payment to the Tarrant County Water Control and Improvement District No. I . 11 . STATE HEALTH DEPARTMENT APPROVAL The water system of the City of Hurst shall be approved by the Texas State Department of Health during the life of this contract. If at any time the water system of the City of Hurst is not approved by the Texas State Department of Health, there shall not be any direct physical connection between the Fort Worth Water System and the Hurst Water System. 12 . RESALE OF WATER The City of Hurst does hereby covenant and agree not to sell water to any user located within its city limits at a rate lower than the equiva- lent Fort Worth rate charged a similar customer located within the City of Fort Worth. The City of Hurst agrees to furnish the City of Fort Worth Water Department a complete rate schedule for all City of Hurst water sales . The City of Hurst will not make any extension of water lines beyond the city limits of the City of Hurst as its boundaries now exist or may hereafter exist, nor permit any connections for water outside its city limits, without •the approval of the City of Fort Worth. - It is not the intent of this section to arbitrarily prohibit the sale of water by the City of Hurst to miscellaneous small customers located .adjacent to or near its boundaries, and the Director of the Water Department of the City of Fort Worth is authorized to approve or disapprove the exten- sion of service by the City of Hurst to such customers outside its boundaries provided that the cumulative annual and maximum rates of use by such customers does not exceed ten percent (10%) of the comparable water usage rates delivered by the City of Fort Worth to the City of Hurst at the .time of review or appli- cation for such service to others by the City of Hurst. In the event the City of Fort Worth agrees to any other extension by the City of Hurst of its water service outside its boundaries, the rates to be charged its customers by the City of Hurst and the compensation to be paid by it to the City of Fort Worth shall be determined and fixed at the time such action is taken. 13 . EMERGENCY RATES OF USE During a temporary emergency condition created by an unforeseeable -11- mechanical failure or by unprecedented high rate of water usage such as might result from a major fire or a major break, it may be necessary that the water be withdrawn from the Fort Worth system at a rate of usage in excess of that required to meet the usual peak requirements of the City of Hurst. It is agreed that extra rate of use charges that would normally be applicable shall not apply for such emergency withdrawals. However, the commodity charge for such water shall be payable. It is further agreed that if Fort Worth experiences such similar temporary emergency water supply conditions, water may be released to Fort Worth from the Hurst system upon request by the Director of the Fort Worth Water Department. The quantity of water used by Fort Worth during such emer- gency conditions shall be deducted from the quantity of water withdrawn from the Fort Worth system during the month by the City of Hurst before computing the monthly payment by the City of Hurst. 14. FORCE MAJEURE If by reason of force majeure, either party hereto shall be rendered unable, wholly or in part, to carry out its obligations under this agreement other than the obligation of the City of Hurst to make payments required under the terms hereof, then if such party shall give notice and full particulars of such force majeure in writing to the other party within a reasonable time after the occurrence of the event or cause relied on, the obligation of the party giving such notice, so far as it is affected by such force majeure, shall be suspended during the continuance of the inability then claimed, but for no longer period, and such party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term "force majeure", as employed herein, shall mean acts of God, strikes, lockouts or other industrial disturbances, acts of public enemy, orders of any kind of the Government of the United States or the State of Texas, or any civil or military authority, insurrection, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipe lines or canals, partial or entire failure of water supply, and inability on the part of the City of Fort Worth to deliver water hereunder or the City of Hurst to receive water hereunder on account of any other causes not reasonably within the control of the party claiming such inability. -12- i i IN TESTIMONY WHEREOF, after proper action by the respective govern- ing bodies for the parties hereto, we have caused these presents to be executed in quadruplicate copies, each of which is considered to be an original , and, the seals of the respective parties to be hereto affixed on the date above written. ATTEST: CITY OF FORT WORTH By: C ty r ret ry ay APPROVED AS TO FORM AND LEGALITY: ♦ I � C i ty Attorney APPROVAL RECOMMENDED: Director Fir Worth Wate apartment ATTEST: CITY OF HU RS, , By �1/1 City Se etary yor APPRO AS TO FORM AND LEGALITY: G� City Attorney -13- ! i City of Fort Worth, Texas Mayor and Council Communication DATE REFERENCE SUBJECT: Contract for Sale of Treated PAGE NUMBER 4/22/68 C-1214 Water to the City of Hurst 1of 2 On April 9, 1968, the Hurst City Council approved a proposed contract, which is attached, for the purchase of treated water from the City of Fort Worth. Summary of Contract Provisions The proposed contract has been prepared in accordance with the standard policy of the City of Fort Worth for the sale of treated water to neighbor- ing communities. The proposed contract includes the following major pro- visions: Rates - The charges for water service are as established by the City Council in M&C G-1202 (3/11/68) . Payment for Water - The minimum monthly payment under the proposed contract is $2,660, for which payment the City of Hurst shall be entitled to withdraw water at the rate of 2,000,000 gallons per day. The minimum annual payment is $84,480 based on a rate of withdrawal of 2,000,000 gallons per day on the maximum day and a usage of 365,000,000 gallons. The actual annual payment for water by the purchaser shall be re- lated to the annual and peak volumes used and will not be less than the charge paid for an equivalent amount used by the water consumer within the corporate limits of Fort Worth plus 10 per cent, plus a $25 monthly service charge per meter. Effective Date for Billing - The effective date of the contract for billing purposes is the 15th day of the month in which the transmission main and meter installation are completed and placed in service by the City of Hurst. Rate Adjustments - The contract provides for rate adjustments based on actual cost and rates of use which will be reviewed at 5-year intervals during the contract period. The first such review and rate adjustment will be effective October 1, 1972. The amount charged for raw water shall be increased or decreased proportionately when the raw water costs paid by the City of Fort Worth for water available for treatment and sale to the City of Hurst is increased or decreased. Term of Contract - The term of the contract is thirty (30) years. The City of Hurst can assign its rights under the contract to another political subdivision of the State of Texas only with the prior written approval of the City of Fort Worth. DATE REFERENCE SUBJECT: Contract for Sale of Treated PAGE NUMBER 4/22/68 NUMBER Water to the City of Hurst 2 or 2 Resale of Water - The City of Hurst agrees not to sell water at a lower rate than the City of Fort Worth rate charged to a similar customer located within the City of Fort Worth. The contract authorizes the Director of the Fort Worth Water Department to approve or disapprove the sale of water by Hurst to miscellaneous small customers located adjacent or near its boundaries. Restricted Supply Procedures - In the event the water supply is restricted in Fort Worth for any reason, the quantity withdrawn by the City of Hurst can be reduced in the same proportion. If it is necessary for the City Council of Fort Worth to ration the amount of water used in Fort Worth, similar rules must be adopted by the City of Hurst. Meters - The master meter will be installed adjacent to Fort Worth city limits and north of the Rock Island Railroad approximately 2000 feet west of Norwood Drive. The meter and all of its appur- tenances will be installed at the expense of the City of Hurst. Connection with the Fort Worth Water Main - On April 9, 1968, the City of Hurst awarded a construction contract for the installation of a 20"-24" size water main approximately 1745 feet in length and the metering installation. The Hurst main will connect with the 33-inch City of Fort Worth Northeast Water Transmission Main, approximately 2000 feet west of Norwood Drive. Recommendation It is recommended that the contract to sell water to the City of Hurst be approved and that the Mayor be authorized to execute the contract on behalf of the City of Fort Worth. HDM:ms Attach. SUBMITTED BY: DISPOSITION BY COUNCIL: PROCESSED BY ❑ APPROVED ❑ OTHER (DESCRIBE) CITY SECRETARY DATE CITY MANAGER