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HomeMy WebLinkAboutContract 13599 CITY SECRETARY CONTRACT CONTRACT FOR WATER SERVICE BETWEEN THE CITY OF FORT WORTH , TEXAS 4 S AND THE N �ECEIVEQ CITY OF EVERMAN, TEXAS FEB 291984 C4 ab" a cl � STATE OF TEXAS COUNTY OF TARRANT THIS CONTRACT AND AGREEMENT is made and entered into this Cf)d day of MMG ' , 19 1%/ , by and between the City of Fort worth , a municipal corporation located in Tarrant County, Texas , acting by and through Robert L. Herchert, its duly authorized City Manager, and the City of Everman, a municipal corporation Located in Tarrant County, Texas, acting by and through Troy Draffron, its duly authorized Mayor. 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 distributing 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 NOD r 1. V.','INN, TEX. WHEREAS, the City of Everman has provided at its own expense and now owns, operates and maintains an underground water supply system and a distribution system; and WHEREAS, the City of Everman currently purchases additional water from the City of Fort Worth under a letter of agreement ; and WHEREAS, the City of Everman has determined that the most eco- nomical and timely source of an additional and continuous water supply to its distribution lies in purchasing treated water from the City of Fort Worth under a long-term water supply agreement as set out herein; and WHEREAS, it is deemed to be in the best interest of both the City of Fort Worth and • the City of Everman that they do enter into a mutually satisfactory long-term agreement by means of which the City of Everman may obtain a supply of treated water from the City of Fort Worth at a reasonable rate ; NOW, THEREFORE, know all men by these presents : that for and in consideration of the mutual covenants , promises and agreements contained herein, the City of Fort Worth and the City of Everman do hereby covenant and agree as follows: -2- 1 . Terms and Conditions The City of Fort Worth agrees to furnish and sell to the City of Everman treated water of potable quality meeting all applicable governmental standards , delivered under the normal operating pressure prevailing in the City of Fort Worth 's water distri- bution system at the point or points of delivery mutually agreed upon. The City of Everman agrees to accept delivery under the conditions of this agreement and to pay for the same in accor- dance with the terms hereof. If at any time during the term of this contract the furnishing of water by the City of Fort Worth to the City of Everman shall be to the detriment of water customers within the City of Fort Worth , then and in that event , the quantity of water furnished to the City of Everman will be reduced in the same proportion to the reduction in quantity of water being furnished all other customers served by the City of Fort Worth . If the City of Fort Worth shall ration the use of water through- out said City or issue water conservation measures or restrict the use of water in any way, the City of Everman shall: -3- Institute and apply the same rationing, conservation measures or restrictions to the use of water by the customers of the City of Everman, so long as any part of the total water supply of the City of Everman is being furnished by the City of Fort Worth, and any failure by the City of Everman to comply with this pro- vision or the other provisions of this agreement shall be just cause for the City of Fort Worth to discontinue the sale of water hereunder. At the request of the City of Fort Worth, the City of Everman agrees to furnish water to areas and premises situated adjacent to the boundary of the City of Everman within the boundaries of the City of Fort Worth . Mains , services, meters, fire hydrants and appurtenances shall be constructed by the City of Fort Worth in accordance with the policy for the installation of community facilities in the City of Fort Worth. Approach mains required to serve such areas shall be provided by the developer in accor- dance with the policies and procedures of the City of Everman . The metered quantity of water used in this area each month by the City of Fort Worth shall be the total of all individual cus- tomer readings . At the option of the City of fort Worth a mas- ter meter may be installed to meter all water used by the City of Fort Worth to serve its residents under the terms of this section. The metered quantity of water furnished by the City of Everman to the City of Fort Worth to serve its residents under -4- the terms of this section shall be deducted from the total quan- tity of water withdrawn from the Fort Worth system by the City of Everman before the charge for water service to the City of Everman by the City of Fort Worth is computed, provided; however, that should the amount of water used by Fort Worth residents exceed the amount taken by the City of Everman, Fort Worth shall pay the City of Everman for the amount of water used in serving Fort Worth residents in excess of the City of Everman' s usage, in accordance with the payment computations set forth in this contract. The amount Fort Worth will pay the City of Everman for its excess usage will be calculated as the quantity of water used by Fort Worth customers times the commodity charge specified under the terms of this contract . 2. Location and Maintenance of Measuring Devices All water furnished under this agreement by the City of Fort Worth shall be measured by one or more suitable meters equipped with continuous flowchart recording devices and transmitting and receiving equipment. All meters and recording equipment shall be installed and operated by the City of Fort Worth. The City of Everman shall pay to the City of. Fort Worth the cost of. the -5- meter, recording and transmitting equipment and appurtenances plus the installation and maintenance cost thereof. The point or points of delivery of treated water by the City of Fort Worth shall be the meter vault connection to the customer ' s side of the meter, and all necessary mains and distribution facilities from and beyond said point shall be furnished by the City of Everman. The location of each meter shall be mutually agreed upon by and between the parties hereto, and the meter or meters shall not be moved or relocated except by mutual consent. Each party hereto shall have the right to test the meters and appurtenances at any time by first giving the other party notice of its intention to make such a test. No meter shall be adjust- ed , changed, or tested,, . in place or elsewhere, unless the party intending to make such adjustment, change, or test shall first give notice to the other party of this intention and thereafter give reasonable opportunity to the other party to have represen- tatives participate in such test , change or adjustment . All meters will be properly sealed, and the seal shall not be broken unless representatives of both parties have been notified and given a reasonable opportunity to be present. -6- Either the City of Everman 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 reguations relative to its operation, maintenance, and reading shall apply as to the meter being tested. 3 . Meter Reading and Billing The City of Fort Worth shall 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 registered accurately for a period of time, the quantity used shall be estimated in accordance with the usage under similar conditions for an equal period. -7- 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 pre- pared so as to reflect any and 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 Fverman agrees to appropriate annually sufficient funds to pay the monthly charge for water service . The water charge to be paid by the City of Fverman to the City of Fort Worth shall be deemedko current expense of the City of Sverman 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 15th day immedi- ately succeeding the monthly billing date. -a_ 4 . Definitions "Annual consumption" is the total quantity of water purchased under the terms of this contract by the City of Everman during the fiscal year of the City of Fort Worth as determined by the difference in the annual September meter readings. "Average daily use" is the annual consumption divided by 365. "Maximum day demand" is the maximum quantity of water used dur- ing one calendar day of the fiscal year of the City of Fort Worth. "MGD" is million gallons per day. "GPD" is gallons per day. "TGPD" is thousand gallons per day. "Fiscal year" is the fiscal year of the City of Fort Worth from October 1 through September 30 . -9- "Maximum hour demand" or "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 repre- sents 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 Everman plus seven percent (7%) of said rate , representing Fort Worth water system losses of three percent ( 3% ) , and the street rental charge of four percent ( 4% ) . "Rate of use charge" is the fixed charge determined for the max- imum daily demand in excess of average daily usage and the maxi- mum hourly demand in excess of maximum day demand rates of use. -10- "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 in- curred in furnishing treated water to its customers, provided that nothing herein shall be construed as contemplating an annual rate of less than the regular City of Fort Worth water only rate, plus ten percent ( 10% ) 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 re- lated to the production and transmission facilities of the total Fort Worth Water System, the capital facilities cost (fixed _ 11- charges } on the production and transmission plant related to the rendition of service at maximum withdrawal rates of use by the City of Everman and the raw water costs . The charges for the initial period of the contract , which shall be from the date of its execution through September 30 , 1982, have been computed as follows: The commodity charge shall be $0 . 4748 per 1 ,000 gal- lons withdrawn by the customer. The annual charge per MGD of daily demand in excess of average daily demand shall be $29 ,600 per MGD and max- imum hour demand in excess of the maximum day demand shall be $ 14 , 150 per MGD. The service charge shall be $25 . 00 per month per meter. 3 . Ad ' ustment o€ rate a. Raw water: The amount charged for raw water shall be increased or decreased proportionately when the raw water cost paid -12- by the City of Fort Worth for water available for treat- ment and sale to the City of Everman is increased or de- creased. At the time of execution of this contract , the rate, including three percent ( 3% ) for system losses, and the street rental charge of four percent (4% ) , to the City of Everman is $0 . 3178 per 1 ,000 gallons. The portion of the raw water charge which reflects system losses shall be adjusted in the manner set out in subparagraph b. below in accordance with actual experi- ence during the preceding period. 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 through 1981-82. The cost related to the production and trans- mission function of distributing treated water to the Fort Worth city limits in wholesale quantities plus a service charge shall be determined in accordance with methods herein. Such costs shall be projected through the City of Fort Worth fiscal year 1987 to establish the fair rate for water to be charged during the period October 1 , 1982 , to September 30 , 1987 . The adjusted rate shall be made effective October 1 , 1982. -13- 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 Everman shall be made as follows: 1 . MINIMUM ANNUAL PAYMENT The minimum annual payment shall be the charges computed for all water delivered by the City of Fort Worth to the City of Everman during the fiscal year based on rates provided herein. However, the minimum annual payment shall never be less than the payment calculated on the basis of the volume of water taken during the current fiscal year and the highest maximum rates of withdrawal during any fiscal year. -14- 2 . MAXIMUM RATE OF DELIVERY The maximum rate of delivery at the initial point of connection shall be 0. 1 MGD. Maximum rates of delivery at subsequent points of delivery, or variations of the rate at the initial point of connection, shall be as mutually agreed upon by the parties hereto. 3. MINIMUM MONTHLY CHARGE The minimum monthly charge will be the charge computed for all water delivered to the City of Everman during the applicable calendar month based on rates provided herein. 4 . MONTHLY PAYMENT The monthly payment shall be calculated at the regular City of Fort Worth rate plus ten percent ( 10% ) of said rate (which in- cludes the raw water costs ) plus the service charge, for the quantity of water withdrawn from the Fort Worth system during the month less any quantity used by Fort Worth. -15- 5. ANNUAL PAYMENT The actual total annual payment for water by the City of Everman shall be related to the annual and peak volumes used by the City of Everman during the fiscal year, as determined by meters , flow recording devices or other approved methods, subject to the min- imum annual payment provisions set forth above. The September bill shall reflect any necessary adjustment to the annual payment due to actual rates of withdrawal from the Fort Worth system. If the initial period of use of water by the City of Everman un- der the terms of this agreement is less than a fiscal year , the annual rates of use charges shall be computed in the proportion that the period of use bears to the fiscal year. The method of computatj.on for determining the total annual pay- ment and the September bill is shown using assumed quantities in the example that follows. Example The City of Everman will buy all water required to fulfill its additional supply needs from Fort Worth. The rate used in the example is based on the City of Everman not being in Tarrant County Water Control and Improvement District No. 1 and water being withdrawn at one metering station. - 16- Usage Month Usage per Month-Gallons Monthly Payments October 1 ,000 ,000 $ 692 .63 November 1 ,000 ,000 692. 63 December 1 ,000 ,000 692 .63 January 1 ,000 ,000 692.63 February 1 ,000 ,000 692 .63 March 2 ,000 ,000 1 ,272 . 19 April 3 ,000 ,000 1 , 800 . 19 May 3 ,000 ,000 1 ,800 . 19 June 3 ,000 ,000 1 ,900 . 52 July 3 ,000 ,000 1 ,900 . 52 August 4 ,000 ,000 2, 428 . 52 Subtotal 23 ,000 ,000 $ 14 ,565 . 28 September 3 ,000 , 000 6 ►420 .00 Total 26 ,000 , 000 $ 20 ,985 . 28 Average daily use for the year 71 , 233 gallons Maximum day for the year 200 ,000 gallons Maximum hour for the year 520 ,000 gallons per day rate -17- Maximum day rate above average daily use = 128 ,766 gallons per day rate Maximum hour rate above maximum day rate = 320 ,000 gallons per day rate Annual Payment Calculation 26 ,000 X .4748 $ 12 , 344 .80 . 1288 X $29 ,600 3 ,812 .48 . 3200 X $ 14 , 150 4 , 528 .00 12 X $25 X 1 300.00 Total Annual Payment $20 ,985 . 28 Previous Billings October thru August 14 , 565. 28 September Billing $ 6 ,420 . 00 -18- When the City of Everman is furnishing water to City of Fort Worth customers, the September bill shall also reflect a credit in the total maximum day and maximum hour charges in proportion to the number of customers furnished water by the City of Everman in Fort Worth and in the boundaries of the City of Everman. 7 . Effective Date of Contract For Billing The effective date of this contract for billing purposes shall be the fifteenth ( 15th) day of the month following the month in which water is first delivered to the City of Everman under this agreement. a . Life of Contract The life of this contract shall be for eighteen ( 18) years from the date of execution hereof, and may be renewed upon terms mu- tually agreeable to the parties hereto. -1 9- 9 . Rights-of-Way The City of Everman shall grant to the City of Fort Worth such easements and rights-of-way along public highways or other pro- perty owned by the City of. Everman as requested by the City of Fort Worth in order to construct and maintain water mains or facilities with the City of Everman to furnish water to the City of Everman and other areas. 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. State Health Depa tment__ Approval The water system of the City of Everman shall be approved by the Texas State Department of Health during the life of this con- tract. if at any time the water system of the City of Everman 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 City of Everman water system unless -20- an approved backflow prevention device has been provided and in- stalled and this installation has been approved by the Texas State Department of Health. 11 . Rate Schedules The City of Everman agrees to furnish- the City of Fort Worth Water Department a complete rate schedule for all City of Everman water sales. 12 . Water Main Extensions Everman will not make any extension of water lines beyond the limits of Everman as its boundaries now exist or may benefits exist, nor permit any connections for water outside City limits , without the written approval of the City of Fort Worth. -21- 13 . 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 Everman to make payments required under the terms hereof, then if such party shall give notice and full particulars to such force majeure in writing to the other party within a reasonable time after the occurence 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 author- ity, insurrection, riots , epidemics, landslides, lighting , earthquake, fires , hurricanes , storms , floods , washouts , droughts, arrests, restraints of government and people, civil disturbances , explosions , breakage or accidents to machinery, -22- pipelines 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 Everman to receive water here- under on account of any other causes not reasonably within the control of the party claiming such inability. -23- IN TESTIMONY WHEREOF, after proper action by the respective governing bodies of 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 _za- 6,411-moc— BY.- "o ity Sec eet zi obert L. Herchert City Manager APPROVED AS TO FORM AND LEGALITY: APPROVED BY CITY couNcIL -"'ty eoratary City Attorney a' - A i - � I APPROVAL RECOMMENDED: Dir ctor Fort Worth Water epartment ATTEST: CITY OF EVERMAN / By: pity Fecretary Ma or APPROVED AS TO FORM AND LEGALITY : 1 . APPROVED BY THE CITY COUNCIL Afi-tZ-rney for fit'7-oT Everman ,/ity Aecretary Date -24- Cz,�City of®f .fort Worth, Texas Mayor and council Communication DATE REFERENCE SUBJECT: Long Term Sales Contract PAGE NUMBER 9/13/83 C-7068 With the City of Everman 2 1 of After execution of a Letter of Agreement dated September 30, 1969, the City of Fort Worth has furnished water service to the City of Everman. The agreement provided that Everman would be served water from the Fort Worth system to supply Everman citizens and some Fort Worth residences that do not have access to Fort Worth water facilities. The amount of water provided to Fort Worth citizens has been deducted from the total water taken by Everman prior to billing Everman double the Fort Worth "water only" rate for water service. The agreement also provided that a long term water contract would be negotiated when Everman desired to do so. It is now considered to be beneficial to both cities to enter into a long term water sales contract. On December 3, 1982, the City Council of Everman approved execution of the proposed long term contract by Mayor Troy Draffron of the City of Everman. This contract was amended by the City of Fort Worth and is now ready for execution. The terms of the contract are summarized below: 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 neighboring communities . The proposed contract includes the following major provisions: Rates - The charges for water service are the same charges paid by other city purchasers of treated water under long term contracts. The charges are based on the following schedule, except that charges for water service should never be less than the Fort Worth rates plus 10%: Commodity Charge - 55.45f per 1,000 gallons purchased Cost of Facility Charge - An annual charge of $46,900 per MGD for MGD for maximum day usage in excess of average day usage; and $23,400 per MGD for maximum hour usage in excess of maximum day usage. Service Charge - $25 per month per meter for meter reading, billing and other expense incurred with metering operations. Minimum Annual Payment - Shall never be less than the payment calculated using the highest maximum rates of withdrawal during any year. Rate Adjustments - This contract is similar to water contracts with other cities and provides for rate adjustments based on actual costs and rates of use. The first review and rate adjustment will be based on the rate consultant 's study and will be effective October 1 , 1987. The amount charged for raw water shall be increased or decreased when the raw water cost paid by the City of Fort Worth for raw water available for treatment and sale to the City of Everman is increased or decreased. DATE REFS EkCE SUBJECT: Long Term Sales Contract PAGE NUM9/13/83 C-7068 With the City of Everman 2,,f 2 Restriction of Water Use - Everman customers would be subject to the same conditions for restriction of water use or otherwise conserving water as would apply to similar customers in Fort Worth should conservation measures be required in Fort Worth. Life of Contract - The term of the water sales contract will be for nineteen years from the date of execution. Everman Water Sales to Fort Worth Citizens - The City of Everman will make water available to the City of Fort Worth to serve Fort Worth customers in areas adjacent to the City of Everman system supplied under this contract with water used by Fort Worth to be credited against water withdrawn by the City of Everman. The City of Fort Worth will pay the City of Everman for the amount of water used in serving Fort Worth residents in excess of the City of Everman's usage in accordance with the payment computation set forth in the contract. Recommendation It is recommended that the City Council authorize the City Manager to execute the contract under which water service will be provided to the City of Everman under a long term water sales contract. DI:faa SUBMITTED FOR THE CITY MANAGER'S DISPOSITION BY COUNCIL: PROCESSED BY OFFICE BY: [ ❑ APPROVED ORIGINATING ❑ OTHER (DESCRIBE) DEPARTMENT HEAD: Richard Sawey CITY SECRETARY FOR ADDITIONAL INFORMATION CONTACT: Lee Bradley Ext. 8220 DATE