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CONTRACT �OR 1NATER SERVlCE BETWEEN
THE CITY OF FORT WdRTH, TEXAS, AND
CITY OF 80UTHLAKE, TEXAS C�NY� C� ������ �
STATE �F TEXAS §
C�UNTY OF TARRANT §
This cor�tract and agreeme�t is made and entered into this ``t''���' day of
���[' . , 2002, by and between the City of Fort Worth, a municipal carporation
located in Tarrant, and Denton Counties, Texas, acting by and through Marc Ott,
its dufy authorized Assistant Cifiy Manager, herei�after called '"Fort Worth," and the
Cify of Southlake, located [n Tarrant County, T�xas, acting. by and through Hifly
Campbell, its duly authorized City Manager, nereinafter cafled "Customer:"
WHEREAS, Fori Worth has �rowided at its owr� expense, and now owns,
op�rates ar�d maintains faciEit�es for processing and distributing a large sup�fy of
surfac� water, and at the present time is qualified ta furnish and deliver treated
water, both within and without the corpvra#e boundaries of Fort Worth; and,
WHEREAS, Customer has pravided at its own expense and now owns,
operates and mainfair�s a distribut�on system; and furnishes water serv�ce to fhe
c�astomers wi#hin its boundaries, and,
WHEREAS, Customer does not have and cannot provide economicaliy and
wifi�in a reasonable period of time, any other source of water supply, fully
adequate to mee� i#s present and/or fufiure n�eds or potential emergency needs;
and,
WHEREAS, it is �eemed to be in the best interest of both Fart Wort� and
Customer t�at saic! �arties �o enter inta a mutually satisfactory agreement by
means of wnich Custamer may obtain from Fort VVo�h a supply af �reated water at
a reasonable rate; and,
WHEREAS, by the execution of this contract, neither Fort Worth nor
Customer will surrender any of its rights tv the ownership ancf operation ofi its
present water production and distriautiort facili�ies; and,
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WHEREAS, Customer desires to �ontinue to contract for the purchase of
treated water and Fort Worth desires fio continue to seil treated water �o Customer;
ar�d
WHEREAS, Section 402.OD1 and 402.Q75 of the Texas Loca� Government
Code, and Chap�er 791 of the Texas Go�ernmenf Code �uthorize Fort Wortl� and
Custamer to enter into this agreement;
NOW; THEREFORE, KNO1N A�.L BY THESE PRE5ENT5:
That, for an� in considerafiion of the mutuaf covenants, promises and
agreements contained herein, Fort Worth and Cus�omer do hereby covenant and
agree as follows:
�.
Definitions
1.� "Ar�nual Consumption" is the totaf quantify af wa#er purchased under
�he terms of this contract by Custam�r during the fiscal year of Fo�t Wor�h a�
determirted by the difference in #he annual October meter r�adings.
1.2 "Average Daify Use" is the tot�l Annual Consum�tion divided by 365
days.
'�.3 "Treatment, Pumping and Transmission Charge" is that part of �he
rate charged fo�' 1,Op� gaflons used, regardless of rate of use. T�is charge s�all
include the mainfienance and operatian cos�s, and the capital facilities cost on the
par� of the product�on and transmission sys#em related io annual use.
'1,4 °Gustomer System" is all necessary Customer mains and distribution
facilities on the Customer's side of the meter from and beyond fhe poir�t of d�livery
of treafied water by Fvrt Worth.
1.5 "Delivery Faci�ity" is any facifity necessary far #he #ransmissioR of
water from the Fort Worth System that is on the Customer's side of th� point of
delivery that is canstrucfed specifiically to ailow Fo�t Worth ta serve Customer.
'!.6 "Dir�ctar" is the Director of the City of Fort Wotth Water Department
or his d�signee.
1.7 "Fiscal Year° is t�e f'iscal year of Fort Worth from October 1#hrough
September 30.
SOUTHLAK� WHOLESAI.E
WATER CONTRACT
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1.8 "'�ort Worth System" is the Fart Worth wa�er treatmenfi and
distribution system.
1.9 "Ger�eral Benefit Facilities" are waier facili#i�s that pro�ide utili�y
senrices and benefiifis common #o all customers whic� include water treatment
faciEities, meter�rtg facilities, control systems and appurtenances, starage facili�ies,
pumping facilities and all major mains thai are si�een inches (16"} and greater in
diameter.
'I .'10 "MGD" is million gaflorts per day,
1:11 "Maximum Day Demand" is the maximum quantity of water us�d by
Customer during one calendar day caf tl�e Fiscal Year of Fork Worth.
'1.�2 "Maximum Hour Demand" or "Peak Hour Rate" is fihe quantity of
water used by Customer during the one hour of the year that more water passed
through the meter or meters serving the Customer than during arty ot�e� hour of
the Fiscal Year of Fort Worth muitipli�ed by 24 hours.
1.'E 3"Rate of Use Charge" is the fixed charge determir�ed for the
Maxim�m Day Demand in excess of Average Daily Llse and the Maximum Hour
Demand in excess af Maximum Day Demand rat�s of use.
1.'[4 "Raw Water C�arge" represents tf�e ra#e for 1,000 �a�fons charged
by the Tarrant County 1lVater Control and Improvement District No. 1 to Fori Worth
for raw water io t�e sofd to �he Custamer plus eigh# percent (8°!0} of said rate,
repres��ting Fort Worth sJrstem iosses o� four percen# {4%}, and the str�et renta!
charge of fo�ar percent (4%). ,
1.'15 "Vllholesale System Access Fee" is a capital con#ribt�tion funding or
recouping the cosfs of General Benefit F�cilities capital impro�ements or General
Benefit Facilities facility expansior�s necessitated by and attrEbutable to new
development.
1.1 �"System Cost" is the operating exper�se and capifal related cost
incurred by Fort Worth pursuant to the provision of water treatmenf and
transmission to the wholesale class af water custivmers. Such costs are to be
colfecfied by For� Worth as a component of the ann�aal cosfi of pro�iding wholesale
wa#er service.
SOUTHLAKE WHOLESA�E
WATER CONTRACT
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'i .'i 7"Volume Charge" represents the combined treatm�nt, pumpin� and
transmissior� charge and the raw water charge in eff�ct far the currenf Fiscal Year.
1.1$ "Capifal improvements" means any of #he following facilities which
provide utility services and benefits common to all customers and that have a life
expectancy of three or more years, whether such capital impro�ements are lacated
within the jurisdic#ional limits of Fort Worth or Custamer water treatment facilities,
metering facilities, con#rol systems and appurtenances, storage facilities, pumping
facilfties and all mains that are sixteen inches (16") and greater in diameter.
1.19 "Facility Expansion" is the expansion of the capacity ofi an exis�ing
facifity tF�at serves the same functiat� as an otherwise necessary new capital
improvement, in order that the existing facility may senre nerry de�elopment. The
term does not include the repair, main�enance, modernizafion, or an expansion of
an existing facility to better serv� �xisting de�elopment.
2.
Terms and Canditions
2.1 Fort Wort� agrees to furnish and sell ta Custamer treated water of
patabfe quality meeting all applicable gavernmental standards, delivered under tF�e
narmal operating pres�ure prevailing in th� Fart Worth System at the point or
points of delivery mutual�y agreed upart. Customer agrees to accept deli�ery
under tF�e conditions ofi �his agreem�nt and to pay for the same in accordance with
the terms herein.
2.2 ln accordance with the �erms of Fort Worth City Secretary Con�ract
No. 12720 }�etween Fort Worth, City of Arlington, City of Mansfield, Trinity Ri�er
A�atf�ority ar�d the Tarrant Coun#y Wafer Control and Improvement Disfrict No. 1,
this cor�tract shail �e deeme� subordinate in all respects to fihe water requiremenfs
of the above contracting part��s as specified in Section 3 of thaf contract,
2.3 ff Fort Wo�th shali ration the use of water throughout its corporate
limits or issue water canservation measures or restric� tne use of water in any way,
Customer agrees ta institute ar�d apply the same rationing, canservation
measures, or res�rictions to the use of water by the customers of Customer for so
long as any part of the total water stapply of the Ct�stomer is beirtg furnished by
SOUTNLAKE WHDLESALE
WATER CONTRACT
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Fort worth. Fort 1North agrees to cansulf with the Water Sy�tem Advisory
Commiftee, in #f�e devefapment of any conservation or rationing plans that may be
necessary �o address operational constraints whether or not same are req�aired by
any state or federal regulatory agency, or are deemed advisable by the Wafer
System Advisary Committee to manage long term System Costs, except where
emergency conditions may dictate shor#-term conservation or rationing
requirements as may be determined by the Direc�or to meet all necessary waier
demands.
3.
Locatian and Maintenance of Measuring De�ices
3.1 All wafer fumished under this agreement by Fort Worth shall be
measured by one ar more suitable meters ec{uipped with cantinuous flow,
chart-recording devices, and telemetering equipment connected w�th the Fort
Wortn control cente�'. AI� mefiers, recorc�ing devices, #elemetering equipment and
appurtenances sha�l be approved and installed by Fort Vllorth. Customer shaCl be
responsible for contracting with an engineering firm to design and pre}�are
construction documents for #h� instailation of any meter for a new point of
cannection that may be required duri�g fhe term hereof. Equipment incl�ded in
�he design shall meet Fort Worth standards. Customer shall pay for tf�e meter
vault and all metering �equipment, including telemetering equipment to the Fort
Wor�h control center, and appurtenances, plus the instaElafinn cost ther�af.
Te�emetry transmitting to Southlake may be installed at the time of consfruction at
the expense of 5outhlake and not as a Sys�em co�t. Fort Wortl� shall pay all cos#s
associated with the operatior� and maintenance o�f said equipment and shall pay
for the replacement of said eyuipment as necessary. Such cosfs, as well as
charges tor the telelink line and microwave transmitter and the power to operafie
same, shall be a System Cost.
3.2 The point or points of deliv�ry af treated water by Fort Worth shall be
the meter vault connection to Custamer's side of fhe mefer, and a!I necessary
mains and distribution facilities from and b�yond said point shall be the
responsibifity of Customer. The location of each met�r sha�l be m�atualfy agreed
50UTHLAK� WHOL�SALE
WATEF2 CdNTRACT
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upon in writing by arid between fhe pariies herefo, and the meter or meters shall
not be mo�ed or refocated except by mutual consenf in writing by the parties
hereto.
3.3 For the cas� of eacF� additional Cusfomer cannecti�r� ta the Fo�t
WartF� Sys#em, Customer will pay an amoun� not less than fhaf which would be
paid by a developer to Fort Worth under its then existing eonnection and lir�e
extension policy, or an amou�t agreed upon mutually by Fort Worth, Customer,
and the Water Sysfem Advisory Committee.
3.4 EitF�er party, at its own expense, may install a check meter to check
or measure fhe voiume of water passing. fhe masfer meter, provided thai, if such
check meter is instalied, the same ruies anti regulations relati�e to its o}�eratian,
maintenar�ce and reading shal� apply as to the rrzaster meter being tested.
3.5 As of the date of the execution of this contract, Custamer`s one paint
af delivery from the Fart Worth System is the meter lacated a� the Nar�h Beach
Wa�er Storage Tank, hereinafter referred to as "Southlake Meter 1". Cusfomer
shalf con�ey or cause to �ave con�eyed to Fork UWorth Soufhlake Meter 1 and the
me�er vault, together with rights of ingress and egress for reading, operafiion, and
mair�tenat�ce purposes. After such con�eyar�ce, Fort Wo�th shall operate and
maintain SoutF�la�e Meter 1 and m�ter vauft as a System Cost. As of the date of
the execution of this contract, no new metering artd �elemetry equipment is
req�ired a# Southlake Meter No. 1.
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Meters
4.'I Fort Worth shail routinely #est for accuracy, and service and cafibrate
if necessary, the master meter(s} r�o less than once during each twelve (12) month
period, Copies of the resul�s of such caEibrat�on and all related information sF�alf be
provided to Customer. Customer shalf have access to the metering facilifies at al�
reasonable times; pro�ided, however, that any reading, calibrafion ar adjustment to
sucl� meiering equipment shafl be done by emp�oyees or ag�nfs of Fort Worth, or
other mutuafly approved third party calibration agent, in ti�e presence of
SOUTHLAKE WHOLESALE
WA7EFt CONTRACT
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representatives of Cus#omer and Fort Worth, if so requested by Customer.
Natification of any propose� tes# shall be pro�ided to fihe Cus�amer at least
seventy-iwo (72) hours prior #o such iest being conducted and Customer may
observe s�ach test, if so desired.
4.2 Upon any calibration, if it is determineci that the accuracy envelope of
such meter is found �o be lower than ninety-five �ercent (95%) or higher than one
hundred five percent (105%) expressed as a percentage of the full scale of the
me�er, the registration of the flow as determined by such defective meter sha[I be
corrected for a period extendin� back to the time such ir�acc�racy began, i� such
`. tirne is ascertainable; or, if such time is not ascertainable, fhen ��or a period
e�ending back one-half (112) � of the time elapsed since the date of the last
calibration, but ir� no event further back �han a period af six (6) months. All meters
wilf b� properly sealed, and t�e seals shal[ not be �roken unl�ss representati�es of
both part�es have been nofified and given a re�sonable opportunity to be preserit.
4.3 If any meter used to determine the flow of trea�eci water to Customer
�s aut of s�rvice or ouf of repair so that the amount of water metered cannot be
ascertained or computed firom fihe reading thereof, the water deli�ered during the
period such meter is out of senrice or out of repair shafl be estimated and agreed
upan by t[�e parties hereto upon the basis of ihe best data a�ailabfe. The basis for
estimating such flow includes, but is not limited fo, extrapolatior� of past patterns of
flow for said mefierir�g station under similar conditions. In the event that the parties
here#o cannot agree on the extrapalated estima�e of wafer vo[ume delivered,
agreement on the flow volume wifl be determined by third parfy arbitration, as
hereinafter �arovided.
5.
M�ter Reading and Billing
5.� Fork Worth will read all mefers pro��ded for he�ein a� monthl�r�
infervafs, and the parties to tF�is agreement shafl have free access to read these
respective meters daily, if eithe� par�y so desires. Ct shal! be the duty of the parties
to give immediate hotiee, each to the other, should any meter be found not
functioning properiy, and, u�on such notice; repairs to _such mefier shall be made
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WATER CpiVTRACT
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�romptly.
5.2 AI� readings of ineters will be entered in ink upon baund jaurnals
maintained by Fort WorEh. C�stomer shall have access �o such records during
reasanable business hours and shafl be furnished with monthly readings for each
point of delivery me#ering facility.
�.3 If Customer has more than o�e point of connectian io the Fort
Worth Sysfiem the sum of ail meter readings and rates of flow shall be used for
the purpose of calculating the water Volume Gharge and the Rate of Use
Cha�ge.
�.4 A review of wafer usage amoun�s by Customer for the �ast twelve
{12) months shall be ma�e during the presentation of the Octo�er bill each year.
The October s�afements shall be prepared so as to refifect any and all Rates o�F
Use Charges that have not been previously �illed and paid. A copy of the rate of
flow charts or other recards showing the Maximum Day Demand and the Peak
Hour Rate of th� year shall be �urnisF�ed to Customer witn the October billing.
5.5 Bills for water service shall be render�d to Custom�r month[y by Fort
Worth. All such bilfs shall be due and payable by Cusfomer not more than thirty
{30} days from t�e billing date. The bills will show current charges, as weEl as
past�due charges, if any. Past-�due charges shal[ be the total amount unpaid from
all prior billings as of the current billing date. Payments receiwed by Fort Warth
shall first be applied to the pas#-due c�arges, if any, and thereafter to the current
charges.
5.6 If Customer disputes a bill and is unable to resolve the difference
informally, Cus�omer shall notify the Director in writing. if �he Director and
Customer are unable to resalve the disputed �ill, agreement on the bili will be
de�ermined �y ihird party arbitration, as hereinafter pro�ided. Dispute ot a bill sha[I
nof be graunds for non-paymen�. [� the ever�t a payment is not paid as specified
in this agreement, a finance charge of ten percent (10%} per annum will be
calcula#ed from the date that t�e payment was required to be made. In the event
ihat a billir�g adjustment is agreed upon ar established by arbitration the amount
found to be incorrect wilf be credited fo Gustomer's acco�nt together with an
SOUTHLAK� WHOL�SAL�
WATER CONTRACT
Page 8 of 32
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in�erest charge of ten percen� (10°fo) per annum calculated from t�e date payment
of fhe disputed bill was receiveti.
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Rates
6.1 Method of Rate Det�rmination
6.�.1 Whofesale water rates will be based upon a cost-of-service rate
study perFormed by indepenclent utility rate consulianfs as provided for in Section
6.1.4 E�ereof. The independent uti[ity rate consultant shafl be selected �y �h�
Director from a[ist of five qualified frms submitted to the Director by fh� Water
System Ad�isory Committee, as such is defined in 5ection 15 of this Agreement.
The cost of any such sfudy shall be a System Cos�. All cost-of-service st�dies
shall be conduct�d utilizing the utility cost basis of determining revenue
requirements appficable to the wholesafe custamer class.
6.'f .2 The cosf-of-senrice for the wholesale class sf�all include alCocated
reasonable artd necessary operation and mainter�ance expense, depreciation
expens� and a fair and reasonable return an allo�ated capital facilitfes. To
determine #he allocation and distribufion of cvsts to the wholesale customer class,
the independent utility rat� consulfant shall cons�der at least the fallawing factars:
tata� volume, rate af flow, meterit�g, and customer-related costs such as
acco�nting, billing, and monitoring. Capi�al-re�ated costs will cansist of depreciation
expense and return on ori�inal cost rate base. The rate base shall cor�sisf of alf
allocated capitaf facilities, net of depreciafian and contrib��ions, and shall includ�
construction work in progress, a reasonable ailowance for warking capital, and a
reasonable inventory of materials and supplies necessary for �he efficient
operation of the Fort Worth System. Records of th� original cost and the
accumulafed depreciation of all capital facili�ies shall be maintained in ihe Fort
Worth Fixed Asset Tracking System. These records shall �e available �or
inspection at the Fort Worth Wafer Department during reasonable business hours
upor� re�uest by Customer.
6.1.3 For� Worth shall he allowed an adequate opportunity to earn a
reasonable rat� of return. The return shafl be sufficient to assure con�dence in the
SOUTFiLAKE WI-IOL�SALE ,
WATER CONTRACT
Page 9 of 32
financial soundness of the �tility, shall be adequate to maintain and support its
credit, shalf enable it ta raise the money neces�ary for t�e proper discharge of its
public dufies, and sha11 be equal to the weighted a�erage imbedded cost of
outstanding debt plus one and one-half percent {9-112°!0).
6.1.4 For the Fiscai Years beginning October �, 2002, 2005 and 2008, a
detailed wholesale water rafe study wi11 be �erFormed by an independenf uiility raie
consultant selecfad by the Director in conformance with Section 6.1.1 herein. The
rate consultant so selected wi[I utilize the same methodology used in the
immediate previous ra#� study. In the int�rim Fiscal Years befiween deta9ied rat�
studies, Fort Worth will adjust who[esale water rates ann�aally, using the sam�
methodalogy as tF�e last detailed rate study, and will utilize the actual operating
data for the twe[ve month period ending September 3pth of the prior year, adjusted
for all known and measurable cF�anges in cost data that may have occurred since
the last audifed financial sfatemen�. Such adjustmen�s should allow for year-end
trending and the spreading of nor�-recurring expenses over an appropriate be�efii
period.
6.1.5 ` Changes in the whalesafe water �a#e metl�odology will b� allowed i�f
recommended E�y a ma�arity vote of the Water System Advisory Committee and
a�proved by the Fort Wort� City Council. For purposes of this section, a majoriiy is
defin�d as any combination af Fort Wor�h wholesale customers that took mare
fhan fifty percent (50%) of fhe wf�olesale water delivered by Fort Worth during the
immediate past Fiscal Year. �
6.2 Rafes to be Used
6.2.� The charges for th� initial period of this contract shafl be from the
daie of its execution through September 30, 2002, and ha�e been computed as
follows:
The Treatment, Pumping and Transmission Charge shall be $0.44�8 per
� ,D00 ga[lons withdrawn by Cusfiomer.
The raw water charge shall be $Q.6573 per 1,000 ga[lons for Customers
inside the Tarrant Regional Water District and $D.7'189 for Customer's
outside the District.
SOUTHLAKE WHOL�SALE
WATER CONTRACT
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The annuaf charge per MGD of Maximum Day Demand in excess of
Average Daily Use shall be $79,373 per MGD, and Maximum Hour Demand
in excess of the Maximum Day Demand shali be $�2,993 per MGD.
6.2.2 The amou�t charged for raw water shali be increased or d�creased
when tY�e raw water cost paid by Fort Wort� for water a�ailable for treatment and
sale to Customer is increased or decreased as c�etermined by the Tar�ant County
Water Control and Impro�ement District Na. 1 in accordance wifh Fort WortF� Gity
Secretary Cantract No. 1272Q, and adjusted for system losses and street rental,
6.2.3 T�e -parties her�to� agre� fhat s�rvices obtain�d pursua�t #o t�is
contract are essential ancf necessary to the op�ratian of C�stomer's waterworks
facilities and that all payme�ts made by Customer hereunder shall constitute
reasonable and n�cessary operafing expenses o� Customer's waterwor�cs and
wasfewater systems within the meaning of Article 1113, Vemon's Annota�sd Texas
Statutes, and the provisior�s of any a�d all ordinances of Customer auihorizing the
iss�aance of any revenue bonds of Customer which are payable from its
waterworks and wastewater systems.
6.2.4 Customer agrees, �hroughout the term of this agreemen#, to fix and
coliect such rates anc� cha�-ges for water service to be supplied as wili produce
revenues in an amount equal io at least (i) all af operation and maintenance
expenses of such system, incfuding specifica�ly its payments under this
agreement; and (ii) all other amounts as required by law and the provisions of the
ordinances or resolutions authoriz�ng i�s revenue �onds or other obligations now or
hereafter autstanding, including the amounts r�quired ta pay all principal of and
in�erest on such bands and other ohligations.
6.2.5 Customer understands that �ort Worth City Council has the right to
annually re�ise the rates charged to co�er all reasonable, actual, and expected
costs. Re�ision of rates sha[I be pursuant to fhe �arovisions se# forih in this
confract. Fort Wor�h sha�l gi�e Cus#omer a minimum of six {6) mor�ths nafice of
intent to revise rates. Fort Workf� will f�rnish members of the Water Advisory
Committee a draft copy of the cosf-of-serv�ce study of #h� proposed rates sixty (60)
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SOUTH�.AKE WHOLESALE
WA7ER GONTRACT
Page 11 of 32
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days prEar to Fort Worth submitting a�ate ir�crease request to its City Council.
Within thirty (30) days of receiving ihe draft study, the Comm9ttee will submit �ts
written comments on �he draft study to �'ort Worth, and For� Worth will respond to
�hese comments as soon ther�aft�r as possible. [f the Committee has not
provided its wr[tten commen�s within said period, the Committee is c4eemed to
�a�e accepted the proposed rates contained in �he draft study, and Customer
agrees #hat it wiil be bound by the rates as approved by tY�e Fort Worth City
Council. The rates approved by the Fort Worth City Council shall be the rates to be
used `m this contract far the succeeding Fiscal Year.
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Paymen# for Water
Payment of charges to Fort Worth for water used by Cus�omer shall be
made as foflows:
7.1 The annual payment will be fhe charges compu�ed based on all
water delivered by Fart Warth to Customer durir�g the current Fiscal Year using
rates pro�ided herein. For purposes o� calculating the a�nual payment, the current
year wiil be the F'iscal Year during which the water usage occurred. However, the
minimum annual payment, will be the greater af fhe following:
1) the charges caiculated by applying the current Volume
Charge to Annual Consumption, the appropriate meter readi�g and billing charge,
and the Rate of Use Charge for the current Fiscal Year; or
2) the current Fiscal year Volume Charge, the appropriate meter
reading and billin� charge, and the current Fiscal Year Rafe ot Use Charge applied
fo the a�erage of the Maximum Day Demand above A�erage Daily Use and the
average of the Maximum Hour Demand abo�e Maximum Day Demand fior t�te
most recently car�pleted three Fiscal Years. The mosf recently completed three
Fiscal Years will indude the current Fiscal Year; or
3} Twelve thousand doflars ($12,OOQ}.
7.2 The rate af wt�ich Custorner witf�draws water from the Fort Worth
System shal! be regulated by rate-of flow controll�rs, pumps, or ather appro�ed
methods. The rate of withdrawal shall be contralled sa fhat t�te maximum rate
SOUTMLAKE WHOLESAL�
WATEi� CONTRACT
Page 12 of 32
snall not exceed 1.35 times tF�e Maximum Day Demand e�cperienced du�ng the
previous year unless Customer has notified the Director in wr�ting at least (6}
months prior to the da#e ofi the anticipa#ed increase in the Maximum Day Demand.
The Director shalf b� furnished w�th all pertinent information regarding the
proposed increase in maximum rate of withdrawa�. The Director may waive all
notice requirements i�, in his sole opinian, said notice is not necessary to protec�
the interest of Fort Worth.
7.3 Except as provided for in secfion 8 below, fihe monfhly payment will
be the greater of ei#her one fihousar�d dollars {$1,000} or a sum equal to the
Volum� Charge for the acfival �o[ume of water taken plus on�-twelfth (�112) of
the sum of the estimated Rate of Use Charges and the appropriate Fiscal Year
eF�arges for meter reading and bi[ling. For purpases of estimating the rate of use
payments, the currenf Fisca[ Year Rate ofi Use Charges will be applieci to the
prior Fiscal Year"s Maximum Day Demand, Maximum Hour D�mand and
A�erage Daily Use.
7.4 The total annual payment for water by Customer shall be related to
tt�e annual ar�d peak �olumes used by Customer during the Fiscal Year, as
determined by meters, flow recording cie�Eces or other approved methods, sub�ect
to the annual payment pro�isions set farkh abo�e. The October b�ll for September
usage shaEl reflect any necessary� adjustment to the annual payment due to actual
rates of withdrawa[ from the Fort Worth System.
Exam�le:
TF�e rate used in ihe example is based on Customer not being in Tarrant
Regional Wafer District and water being w[thdrawn at one metering station, and
the Volume Charge and Rate of Use Charges in effect until Sepfember 30, 200'{ .
SOUTHLAKE VIiHQLESALE
WATER CONTRACT
Page 13 of 32
Usage
Month
Total
Oct
No�
Dec
,1an
Fab
Mar
Apr
M ay-
Jun
Jul
AUg
Consumption
1,0OO,OaO
1,0OO,OQO
� ,000,000
1,000,000
� ,00a,aoo
2,000,000
3,OOa,OQO
3,OOQ,000
3,000,000
3,000,000
4,000,000
23,00O,OOd
Volume
Charges
$1,159.70
$1,159.70
$9 ,159.70
$1,'� a9.70
$1,159.7a
$2,319.40
$3,479. 9 0
$3,479.10
$3,479.1 Q
$3,479.10
$4,638.80
$26,673. � 0
Rate of Use
Charges
$'1,D90.90
$1,a90.90
��,a�a.so
$1,090.J0
$1,090.90
� � ,osa.so
��,o�a.�o
$1,090.90
$1,090.90
$1,090.90
$1,09D.90
$11,999.94
$25
$25
$2�
$25
$25
$25
$25
$25
$25
�z5
$25
$275
$2,275.60
$2,275.6Q
$2,275.60
� $2,275.60
$2,275.60
$3,435.30
$4,59�.00
$�,595.00
$4,595.Q0
�4,�s�.oa
$5,754.70
$3$,948.00
Sep 3,bD0,OQ0 3,479.1 Q 3,773.06 $25 7,277.16
26,000,000 $30,152.20 $15,772.96 $300 $4�,22v.16
Prior Year Rate of Use Calculation
(Far use in estimated monihly Rat� of Use Charge) �
Av�rage Daily Use for the prior year = 60,040 galions
Maximum Day Demand for the priar year = 175,000 gallons
Maximum Hour Dema�d for fhe prior year = 480,QQQ gallons
Max�mum Day Demand above A�erage Daily Use ='E �5,00� ga[Ions
Maximum Hour Demand above Maximum Day Demar�d = 305,000 gallons
Month[y Excess Maxim�m Day a�d Hour Payment Calcuiation
.115 mg X $79,373 $ 9,127.90 (Maximum dayj
.3D5 mg X $12,993 $ 3,962.86 (Maximum hour}
Total $13,090.76
Monthly Rate of Us� Payment (Total Di�ided by 12)= $1,09Q.90
A. The ar�nual payment calculation will be computed on tf�e basis of
the c�rrent year maximum usage rafes or the average of the
maximum usage rates of the mos# receni three Fiscal Years,
whichever is greater. In Example A, the current year exceeds the
average of the most recent tl�ree Fiscal Years.
Monthly
Service
Charges
50UTHLAKE WHOL.ESA�E
WA7Ei� CQNTRAGT
Page 14 of 32
Current Year Rate of Use C�Iculation
Current Year Raie Of Use Calcu[ation
Average Daily Use far the year = 70,312 galfons
Maximum Day D.emand for #he current y�ar = 2� 5,000 gallons
Maximum Hour Demand for the current year = 545,000 gallons
Maximum Day Demand abo�e Average Daily L)se = 144,688 gallons
Maximum Hour Demand above Maximum Day Demand = 330,000 gal�ons
Fiscal Year A�erage of Most Recent Three Years
CURRENT FY FY
FY 2000 1999
Maximum Day Demand
above Average Daily Use 144,688 115,000 128,766
Maximum Hour Demand
abo�e Maximum Day Demand 330,000 305,000 320,�00
Three year a�erage of Maximum Day Demand
above Average Daily Use
Th�ee year average af Maximum Hour Demand
above Maximum Day Demand
9 29,485
318,333
Customer's annual paymen� will f�e based on the greater of the current year
maximum �sage rates or the average of the maximum usage rates of the most
recent ihree Fiscal Years.
AnnuaE Payment Calcu[ation
(Based on Current Year Data)
FY 'Q 1 Rates
26,OOd X $ 1.1597
.1447 mg X $79,373
.3300 mg X $12,993
12X$25 X1
Total Annual Payment
Previous Billings for
October through August Usage
October Billing for Sepiember
Usage
$3a,'152.20
1 � ,48v.27
4,287.69
300A0
$46,225.16
�c: ••: �f
$ 7,277.16
SOUTHLAKE WHOLESALE
WRTER CONTRACT
Page 15 af 3�
B. Example of computation when the a�erage of the maximum usage rafes of
the most recen� #hree Fiscal Years is greater than fhe current Fiscal Year rate of
us�:
Current Year Rate of Use Calculation
Average Daily Use for the year — 70,312 gaflons
Maximum Day Demand for the currenf year = 215,000 gal�ons
Maximum Hour Demand for the current year = 545,OOQ galldns
Maxim�am Day Demand above Average Daily Use ='�44,688 gallons
Maximum Hour Demand above Maximum Day D�mand = 330,000 �alions
Fiscal Year A�erage of Mast Recent Three Years
CURRENT FY FY
�Y 2000 �999
Maximum Day Demand
above Average Daily �se 144,688 1��,000 1'8,234
Maximum Hour Demand
abo�e Maximum Day Deman� 330,000 305,000 3fi1,000
Three year average of Maximum Day Demand
abo�e Average Daily Use 145,974
Three y+ear average of Maximum Ho�ar Demand
above Maximum Day Demand 332,oaa
Customer's annual payment wiEl be based on the great�r af the
current Fiscal Year maximum usag� rates or the average of the
maximum usage rates of the most recent fhr�e Fiscaf Years.
Annuai Payment Calcufafion FY'01 Rafies
(Based on average of most recent three years)
26,000 X $1.1597
.1 �60 mg X $79,373
.332Q mg X $12,993
12X$25 X'i ,.
Tofa� Annua� Payment
Previous Billings for
October through August Usage
October Billing for 5eptember
tJsage
$30,152.20
11,588.46
4,313.68
3QQ.D0
$46,354.34
�c: •�: ��
$ 7,406.34
SOUTHLAKE WHOLESALE
WATER CONTRAGT
P�ge 16 of 32
���
Effecti�e date af contract
8.1 The ef�ective date ofi this contrac� is fhe date ofi execufion.
9.
Life of contract
9.1 This contract shall expire on December 31, 2010, and may be
renewed on terms mutually agreeable to the parties hereto.
'I 0.
Rights-of-way
10.1 Customer snall grant, withouf charge to Fort Worth, such easements
and rights-of-way along pub[ic highways or o�her property ow�ed by Customer, as
r�quested by Fort Worth, in order to construct or maintain mains or faciliiEes within
the service area of Customer to provid� water to Customer and to ather areas.
Upon notic� from Customer and at For� Worth's expense, Fort Wor�h wil[ move
such water mains or facilities located in such street rights-of-way, or othe� property
owned by Customer wfi�en reasonably necessary to the performance o� ess�ntial
governmen�al duties by Customer. Fort Worth shall grant, without charge to
Cus�omer, such easements and rights-af-way along public highways or other
property owned by Fort Worth, as requested by Customer, in order to construct
and maintain water mains or facilities within Fort Wor�h #o provide water to
Customer. Upon notice trom For� Worth and at Customer's expense, Customer
will mo�e such water mains or facili#ies when located in such sfreet rights-of-way or
other property owned by Fort Wor�h when reasonably necessary to pertormance of
essential gouernmental dufiies by Fort Wor#F�. All work done by or on �ehalf of �o�i
Wor#h under this paragraph will be perFormed in accordance with specifications
eQual #o fhose appfying to work of a similar natur� performed within �ort Workh, but
neitF�er party hereto will be �equired fio restore the o�her's proper�y to a candition
exceeding its original condition, unless otherwise mufually agreed in wri#ing. Fort
Worth ane! Customer agree to coordinafie the location of fhe mains andlor facilities
in the other's easements and rEgh�s-of-way in order to prevent furthe� conflicts
insofar as is reasonably �racticable.
SOUTHLAiCE WHDL�SALE
WA7ER CONTRACT
Paqe 17 of 32
11.
TEXAS NATURAL RESOURCE CONSERVATi�N COMMIS5I�N ("TNRCC")
DEPARTMENT APPROVAL
11.1 The Customer 5ystem shall be approved by the TNRCC during the
life of tF�is contracf. If at any time �he Customer System is noi approved by the
TNRCC, or if Customer does not have an acti�e cross�connec�ion cor�trol program,
there shall nat be any direct physical connection between the Fort Wor�h System
and the Customer System unless an appro�ed backflow pre�ention deWice has
been pro�ided and installed and this instailatian has been appraved by the
TNRCC. All expenses to provide and instail backf1ow prevention d�vice(s) will be
borne by Customer.
12.
Resale ofi Water
12.1 Custom�r agrees that it will not share facilities for water system use
with any other go�rernmen�al or corporate entity outside of the corporate limits of
� Customer, commonly known and ref�rred to as its service area, wifhout the
express written consent of Fort Worth, which consent shalf not be unreasonably
wit�held. Fort Worih neither recognizes nor appro�es any exis�ing agreemenis
entered into by Customer with o�her go�ernmentaf or corporate enfi�ies outside its
service ar�a.
12.2 Only those existing connections outside of the Customer`s Water
System that are shown in Exhibit "A°' attached hereto, shall be permitted to
continue. Cus#ame�' agrees tha� it wi11 not ent�r into any resale or transporta�ion
agreement other than as a part of its normal offering and supply of water to
existing and future su�scribers ta its water sysiem without the recommendation of
the Water System Advisary cammittee and express written cansent of Fork Worth.
12.3 Customer agrees �o pro�ide For� Worth a map of its service area,
together witE� all water service agreements it has with otF�er jurisdictions.
50L1THLAKE WHOLESALE
WATER CONTRACi
Page 18 of 32
'I 3.
Sanitary Sewer Facilities
13.1 The Customer agrees tha� it will require all of its customers, who are
provided water from fhe For� Worth system, fo have adequate sanitary sewage
fac�iities meeting state health c�epar�ment requir�ments.
14.
Additional Parties
14.1 Fort Worth will use its best efForts to pravide an adequate water
supply for all of iis c�stomers. Prior to the approvaf of additional wholesale
customers, Fork Wor�h will pro�ide reasonable assurances tMat the projected
five-year water demands of the then�existing wholesale customers so served and
fhe proposed additional customer can be adequately fuffilled. �'ort Worth will
consu;t with the Water System Ad�isory Committee prior to contracting with
additional parties..
�5.
Wa#er 5ystem Advisory Committee
15.1 Customer's gover�iing body.sha�l annually appoint a�epresentative fo
be a �oting member of fihe Water System Ad�isory Committee, whose purpose
shall be to consult with and advise Fart Worth, through the Director, an matters
pertaining to conservation, wholesale �Eanning, improvements, grants, wholesale
rate studies, administra#ion, budgets, and additiona! whofesale customers, whet�er
same be wholesale customers of Custamer or For# Warth. The Committee may
establish bylaws go�erning the election of officers, meefing dates and other
matters per�inent to i#s functioning. �
�6.
System Access Fees
16.1 On a quar�erly basis, Customer agrees to pay to Fort Wart� a
Vllholesale System Access Fee for each new or enlarged cannection for v�ater
servEce made within the quarter within Customer's servic� area served by the
General Benefit Facilities of the For� Worth Water System. The Wholesale
System Access Fee to the Cusfiomer for eacE� such connection shall be based
SOUTHLAK� WHOLESALE
WATER CONTRACT
Page 'E 9 of 32
upon the size ofi water meter and sl�a[[ be equal to the Wi�olesale 5ysfem Access
F�e collected for the same size water meter made within �he jurisdicfior� of Fort
Worth. The calculation of said W�a�esale System Access Fee shall be consister�#
witf� a�l �pplicable state and federal regulatians, including Chapter 395, Texas
Local Governmen# Code, or any amendment or successor statute thereto, and
shall inelude only those costs associated with General Benefit Facili�ies
expansions and capital impro�ements necessary to provic�e service �o new
development. Nothing within this contrac� shall be deemed to prevent either Fort
Wor�h or Custamer from charging their own retail customers impact fees in �xcess
of the Wholesale System Aecess Fee pro�ided for her�in.
16.2 Fort Worth agrees fhat all monies remitted to it �ursuant to this
Section will be placed in a separate interest bearing account to pay only for the
cost of canstructing capital impro�emen�s or facility expansions as permitted by
Chapter 395, Texas Local Gor�ernment Code, or any amendment thereto, or by
any successor statute thereto, and will not be used for operafion and mainfienance
expenses. Once expended, such funds ar�d all interest earned thereon will be
considered a"contribution" for rate setting purposes onfy.
16.3 Custamer shall provide to �ort Worth such information that relates to
the making of new andlor enlarged connections w�thin its jurisdiction as may be
requested by the Direc#or, including but r�ot I[mited to b�ifding permits, wifh each
quarteriy payment required in this section.
16.4 Neither Fort Wor�h nor Customer shall waive any impact fee due
from riew ar er�larged connections to its respecti�e system within its jurisdiction.
However, Either Fort Worth or C�sfomer may pay such impact fee in#o th� fur�c�
required for paying for the capital improvements.
16.� The Water Sys�em A�visory Committee created pursuar�fi to Sec#ion
15 hereof shail se�ect five (5} of its members to a subcommitiee to be known as
the Custamer Impact Fee Committee (CIFC}. Every t�ree years, beginning Jun�,
1992, Fort Wor�F� wilf update the land use assumptions and capital impro�ements
plan upan which the Whof�sale System Access Fees are based. In June 1992
and every three years thereafter, the CIFC sha[I subm�t a list of five quafified
SOUTt�LAICE WHOLESALE
WAT�R GDN7RAGT
Page 20 of 32
engineers or planning cansu�ta�ts to the Director. The Director snall sel�c� a
constaliant fram such list to assist Fort Worih in de�eloping land use assumptions,
identifying capitaf �mpra�emenfs, and formulating capi�al impro�ement plans and
access fees. T�e consulfant shall be responsible to For� Worth and its citizen's
ad�isory committee, but sF�all also report to the CIFC. The cast of the consultant
shall be deemeci a System Cost. In tf�e e�ent the CIFC fails to submit a lisf of five
consultants to Fort Worth, Fort Worth shall seC�cf a consultan# to perform in the
manner describ�d �terein.
16.6 Fort Worth agrees tha# only those capital improvements as defined in
section �.9 8 hereof shall be included in t�e capital improvements plan for the
purpose of determining Wholesale System Access Fees; provide� howe�er, Fo�t
Worth may include other capita! impro�ements for the purpose of determining
impac# fees to its own retail customers. Fort Worth shall not be requireci to ir�clude
alI capital improvements in any cap[ial improvements plan. The CIFC shall be
responsibfe for working with Fort Worth and its consultant to determine the capital
improvements to be includec� in the calculation of any Wholesa[e System Access
Fees. Th� CIFC shall recommend to fhe Water System Advisory Committee
which capital improvements should be included in the cafcufation of any Wholesale
System Access Fees. The CIFC shall also meef wEth For� 11Vorkh's citizen ad�isory
committee as such citizen's advisory cvmmittee re�iews and considers land use
assumptions, the capital improvements plan and impact fees.
16.7 Prior to the adoption of any land use assumptions, capital
improvements, or access fees by Fort Worth, the CIFC shall be furnished a copy
of fihe proposed land use assump�ions, capital improvement plan or acc�ss fees af
least 30 days prior to any schedu[ed hearir�g thereon. Any revised access fee
adapted pursuant to such updatecf ca�aital improvements plan s�a{I not take effect
for a period of at leasfi ninefy (90) days a�ter adoption by Fort Worth.
'16.8 Each year Fort Worth shall pro�ie�e to the Whoiesale Water Advisory
Committee an audited fiinancial statement of the Fort Worth Water Depar�ment's
records.
SOUTHLAKE WHOLESALE
WATER CONTRACT
!'age 21 of 32
16.9 Fort Wa�th and Customer agree that the methodology for #he
calcufation of WhoEesale System Access Fees required herein shall be consistent
with the m�tha�ology prescribed by Chapter 395, Texas Local Government Code,
or. any amendment or successor statute thereto. In the event that such statutory
methociology is �mended or replaced by a new siatute, the W'holesale Water
Advisory Committee may engage legal cour�sel �o work with Fort Worth to propose
amendments to this contr�ct to conform it to such amendment or new stafute. The
reasor�able cost of such legal counsel sh�{I be a System Cosfi.
17.
Termination
'[ 7.1 This agreemenf may be ierm�nated in whole or in part t�y the mutual
consent of Cus�omer and Fort WarEh. Noiwithstanding anything contained herein
to the contrary, any mafierial breach by either party hereto to perform any of the
duties or the obl�gatians assumeci by such party hereunder ar ta fiaithfu{I�r keep and
perform any of the terms, conditions and pro�isions F�ereof shall be cause for
termination of this agreement by either party in the manner set forth in this
paragraph. Fork Worth shall deliver to Customer n�nety (90) days prior written
notice of its intention ta so terminate #his agreement if Customer fails to cure or
adjust such material breach, including in such notice a reasonable description of
the breach. If within said ninety (90) �ays Customer shali fail or re�€use to cure
such maferial breach to the satisfaction of Fort VVorkh, then and in such event, Fort
Vllorth shail have the right, with six months addiiional ad�ance written notice to
Customer and withou# any [iability whafsoever on t�e part of Fori Worth, to declare
this agreement terminated. In the event af termination of this agreement, all rights,
powers, and privileges of Customer hereunder shall cease and terminate and
Customer shall make no claim of any kind wi�atso�ver agains� Fort Worth, ifis
agents or representatives, by reason of such termination or any act incident
thereio, provided Fart V�lorth acted reasonably and such fiermination was not
unreasonable, arbitrary and capricyous. Fort Worth shal[ advise Customer in
writing immediately upon acce�tance of th� cure of any breach.
SOUTHLAKE WHOL�SALE
WATER CUM1ETRACT
Page 22 of 32
'f7.2 ln the event Fort Warth shall ration the use of water fihroughout its
corporate limits or issue water con5ervation measures or res#rict the use of wa�er
in any way as provided far in Section 2.3 hereof, and Customer fails or refuses to
insfifute and apply the same rationing, conservation, or res�rictions to the use of
the water �y the custamers af C�stomer, Custamer shall be in breach of this
agreement. The notice provisions as contained in Sec#ion 17.1 hereof shall not
appEy and the �irector, in his sole discretion, s�all, in writing, set such time in which
the Customer sF�all cure said breach. If Customer fails or refuses to cure said
breach within #he sta#ed time, tnen and in such e�ent, after s�x (6) months written
notice pra�ided to Customer and wifhout any liability whatsoever on tne part of Fort
Worth, Fort Worth shall ha�e the right ta declare #his agreement terminated. ln
e�er�t af termir�ation af this agreeme�t, all rigl�ts, powers, and privileges of
Customer i�ereun�er sha[I cease a�d Customer shall make no claim of any kind
whatsoever againsf Fort Worth, its agents, or representatives, by reason ofi such
termination or any act incident there#o, provided Fort Workh acted reasonably and
s�ch �erminatian was no# unreasonable,� arbitrary and capricious.
17.3 Irrespective of whether or no� a breach hereof is a material breach or .
a non-material breach, and irrespecti�e of any cure of such breach, a second
breach of the same nature violating any.term or condition herein shali entitle For�
Worth, after six (6) months written notice pro�ided to Customer and without any
liabifity whatsoever on the part of Fort Worth, io declare fhis agreement
terminated. In event af termination af this agre�ment, all rights, powers, and
privileges of Customer hereunder shall cease and Cusfomer shall make no claim
of any kind whatsoever against Fort Worth, ifis agents, or representafi�es, by
reason of such termination or any act �ncident thereta, provided Fort Wo�th acted
reasonably and such termination was not unreasa�able, arbitrary and capricious.
17.4 The fo�iowing breach, default or failure to perform a duty or obligation
shall be considered fio be a material breach:
a. Failure fa adopt and enforce any resolution or conservation
measu�e or rationing rec{�ired to be adopted and enforced
herein;
SOUTHLAKE WHOLESALE
WAT�R GONTRACT
paoe 23 of 32
b. Failure fo make any �ayment af any biil, charge or fee as
pra�ided for in #his agreement;
c. Making any connection to fh� Fo�t Worth System at any point
except as provided in Sectian 3.2 hereof;
d. Failure to cor�ect arty potentialEy hazardous connection in
accordance with Sectian 11 after reasonable written noiice;
e. Failure to provide F'ort Warth ingress and egress for purposes
af operation and maintenance of any metering facility;
f. Failure to provide Fort Worth rigi�ts-of-way as required herein.
17.5 �n the event of any other non-material breach, de�ault or failure to
perForm duties under �his agreemenfi, Fort Worth shall deli�er to Cus�omer sixty
(60) days advance wri�ten notice of such default, ff Customer f�ils fo cure such
breach, default or failure, then Fort Wor�h shall gi�e Cusfiomer wri#ten notice of
such fail�re to eure and may surcharge Customer Five Thousand Dollars ($5,oaa�
per month un�il such time as Cusfomer cures such non-material breach.
� 7.6 Any failure by Fort Worth to so �erminate this agreement or the
acceptanc� by Fort Worth of any benefi�s under this agreement for any period of
�ime after such maferial breach, default or failure by Cus#omer shall not be
determi�ed #o be a waiver by Fort 1North of any rights to terminat� fhis agreement
for any subsequent material breach, defaul� ar failure.
'f 7.7 Any failure by Custamer �o sa ferminate this agreement or the
acceptance by Custamer of any benefits under this agreement far any period of
time after suei� material breach, default or faifure by Fort Worth sha�l not be
determin�d to be a waiver by Customer of any rights to terminat� fhis agreement
for any subsequenf mat�rial breach, default or failure.
18.
Ownership and Liabilify
18.1 No provision of th�s agreemenf shall be construed to create any type
of joint or equity ownership of any proper�y, any parknershi� or joint �enture, r�or
SOU7MLAKE WNO�.ESALE
WATER CONTRACT
Page 24 of 32
shall same create any other rights ar liabilitEes and Customer payments (whether
past, present, or future) shall nof be co�sirued as granting Custamer partial
owners�ip of, pre-paid capacity in, or equity in th� Fort Worth System.
18.2 Liabilities for damages arising from the proper treatment,
franspartatiart and deliWery for afl water provided hereuncier s�all rerriain with Fort
Wor�h to the point of deli�ery and, upon passing through the meter, liability for
such damages shall pass to �he Cusfomer, save and except thaf Fort Worth's so�e
responsibility is fio provide to C�tstomer wat�r of a quali#y which mee#s state and
federaE drinkir�g water standards. Each party hereto agrees to save and hold the
other party harmless from al� elaims, demands, and causes ofi action that may be
asserted by anyone on account of the qualify, transportation a�d delivery w�ile
water is in the cor�tro! of such party. This covenant is nat made for the b��efit of
any ihird party. For� Wor�h takes the responsibiiity as between parties hereto for
the prapa� #reatment, c�uality, transportation, and delivery of all such water provided
by it to th� point of delivery.
18.3 Con�racts made and entered into by either Customer or Fort Worth
for the constrt�ction, reconstr�ction or repair of any Delivery Facifity shali include
the requiremen# that the independent canfractor{s) mus� provide adequate
insurance protecting both the Customer and Fort Worth as co-insureds. Such
cor�tract m�tst aiso pro�ic�e that tF�e independent contractor{s) covenant to
indemnify, hold harmless and defend both th� Customer and Fort Worth against
any and all sui�s ar claims for damages� of any nature arising out of the
performance of such contracf.
�
Force Majeure
19.1 If by any reason of force majeure either party �ereto shall be
rendered unable, wholly or in part, to carry o�at its obligatians under �his agfeem�nt,
other than the ob[igation of the Customer to make payments required ur�der the
terms hereof, then if such parties shall give notice and full particulars of such force
majeure in writing to the other party within a reasonable fime after the occurrence
of the euent or cause reliec! on, fhe obliga�ion of the party giving sucn nofice, sa �ar
SOUTHLAKE WHOLESALE
WATER GC)NTRACT
Page 25 of 32
as it is afFected by such force majeure, shall be suspended d�ring the continuance
of the inability► fhen claimed, bu� fior no longer period, and sucfi party shall
endeavor to remove or o�ercame such inability wifh all reasonabfe dispatch.
19.2 The term "force majeure", as employed herein, shall rnean acts af
God, strikes, fockouts or other ir�dustrial disturbances, acts of publ�c enemy, o�-ders
of any kind of the go�ernment of the Unitec� Sfates or fhe S�ate of Texas, or any
civil or military autharity, ins�rrection, riots, epidemics, IandslEdes, lightning,
earthquake, fires, hurricanes, storms, floods, washouts, ciro�ghts, arrests,
restraints of go�ernm�nt and people, civil dis#urbances, explosions, breakage or
accidenfs to machinery, pipelines or canals, partial or entire failure of water suppiy,
and inabifify on the part of Fort Worth to deliver water hereunder or �he Cusfomer
to receive water hereunder on account of any ather cause not reasonably in the
control of the party claiming such inability.
20.
Natices
20."I Any natice, communication, request, reply or ad�ice her�in pro�ided
or permitted #o be gi�en, made or accepted by either party fo the other party must
be in writir�g to:
City of Fort Worth: Water Director
C�ty of F'ort Worth
1000 Throckmorton Street
Fort Worth, TX 78�02
Customer: City Manager
City of Southlake
�400 Main S�reef
Southlake, Texas 76092
The par�ies hereto shall indicate in wrifir�g any change that may occur in such
respective addresses from time to time.
SOU7HLAKE WHOLESALE
WATER CONTRACT
Page 26 of 32
� 1 �
21.
Inspection and Audit
21.1 Complete records and accounts requir�d to be maintained by each
party f�ere�o shall be kept for a period of five (5) years. Each party shall af aA times,
upon notice, have the right at reasonable times to examine �nd inspect said
records and accounts durirog normal �usiness hours; and furth�r, if required by any
law, rule ar r�gulat�on, make said records and accounts available to federal andlor
s�ate auditors.
22.
Miscellaneaus
22.1 Fort Worth and Customer agree that if Fort Vl/or�h sho�ld enter into
any fiuture contract for supplying treat�d water to any municipality under more
favorable terms or conditions fihar� sei forth herein, this can�ract shall be ar�ended
to provide the same terms and conditions wi#h respect to fhe sale of #reated water
to Customer.
22.2 During a temporary emergency condiiion created by unforeseeab�e
mechanical failure or by unprecedented high rate of water usage such as might
result from a major fire or a major water main f�reak, it may be necessary that
water be withdrawn from the Fo�t Wor�h System at a rate of usage in excess of
that required for the usual peak req�irements of Custamer. It is agreed that extra
Rate of Use Charges fhaf would normally be applicable shall not apply for such
bona fide emergency witf�drawals providecf thaf Fort Worth is notified- in writEng
within 48 hours of tt�e occurrence of an emergency condition. In any event, the
volume and Rate of Use Charges fo�- ali water deliWer�d shall be d�e and payab[e
as c�escribed elsewhe�'e herein.
22.3 A# the request of the Director, Customer agrees to furnish water to
areas and premises si�uated adjacent to the bo�andary of Customer an� within the
boundaries of Fort Warth. The metered quantity of water used in this area eac�
SOUTHLAK� WHOLESA�E
WATER CONTRACT
Page 27 of 32
� r' �
month by Fort Worth shall be the �ofal of all individual customer mefer readings. At
the option of Customer or Fort Wotth, a master meter may be installed where
practicabie at the exp�nse of Fort Wor�h to mete� all water used by For� Worth
under #he ferms of this sec�ion.
22.4 The metered quaniity of wa�er furnished by Customer to Fort Worth
shall be cieducted from �he to�al c�uantity of water withdrawn from the Fort Vllorth
System. by the Customer before fhe charge for water service fo Cus#amer is
computed in accordance with the payment computations set forth and based an
fhe Volume Charge deseribed herein and the quantity of water so withdrawn from
the Fort Worth System,
22.5 This agr�ement is s�abjec� to all appl�cable federal and sfate laws and
any appficable permits, amendmenfis, orders, or regula�ions af any s#ate or federal
go�emmental authority having or asserting jurisdiction, bufi nothing cantained
herei� shall be construed as a wai�er of any right to question or confest any such
law, order, rule or regulation in any forum havit�g jurisdiction.
22.6 Customer agrees to abide by any changes iri this agreement made
necessary by ar�y new, amended, or revised state or federal regulation.
22.7 Upon prior notice by Fort Worth, any duly authorized emplayee of
Fort Worth bearing proper credentials a�� identification shall �otify Customer of
need for access ta any premises loca#ed with�n Customer's service area or served
by Customer as may be necessary for the purpose of inspections and observation,
measurements, sampling and testing and/or audi#ing, in accordance with the
provisions of this coniract. Custom�r may e�ect to accompany the Fort Worth
representative. To fhe extent permitt�d by law, �ort Worth agrees to ind�mnify
Customer far any damage or injury to persan or prop�rky caused by tt�e negfigence
of sucF� duly aufhorized employee wh�ie such employee is in the course and scape
of his employment.
22.8 Whenever any dispu�ed matter herein is to be specifiically
determined by the use of an arbitrator, th� foHowing procedure is to be followed.
The par�y requesting that tt�� dispute be s�ttled b� arbitration shall serve on the
ofher party a requesf in writing that suci� matter be handled by arbitration.
SOUTHLAKE WHOLESALE
WATER CONTRACT
Paae 28 af 32
� i ,
Customer and Director shafl mutually agr�� in writing an the selec�ion of an
impartial arbifrator. Such agreement s�all be made within ten (10) days fram fhe
date that the request for arbi#ration is received. If an agreement is not reached on
the selection of the impartial arbitrator on or before fihe tenth �10th) day after the
date that notice is reeeived, the Director shall immediately request a list of se�en
qualified neutral arbifrators from the American Arbitration Associafion or the
Federal Mediation and Conciliation 5ervice, ar either's successor in funcfiort. The
Customer and Direcfor may mutually agree on one of the se�en arbitrators on the
lisf. !f #hey do not agr�e within five (5) working days after the receipt of the list,
Customer and Direc�or shalf alternafe stri�cing a name from the list and tE�e name
remaining shafl be the impar�ial arbitrator. Cusfiomer and Direetor shall mutually
agree on a da�� far the arbitration hearing. Tl�e deeision of the arb�#rator shall be
fnal, and juc�gment may be enfiered upon it in accordance with applicable [aw in
ar�y cour� having jurisdiction fihereo�. All costs of arbitration shall be considered a
System Cost.
22.9 If reques�ed by the Director, Custam�r shall provide qu_arterly #he
following data:
A. Actual number af customer accounts consuming directly or indirect�y
from the Gusfomer System wifhin its service area;
B. Classificafion of domesfiic and non-domestic accounts within its
service area by number and percentage of accounfs consumi�g
directly or indirectly firom Customer System within its service area;
C. Cus�orner water usage from ap saurces other than the Fort Worth
System, inclUding, bufi not [imited fio, ground wa#er, other surface
water, and water supply agreements wi�h other en�ities;
[7. Additiona! da�a which may assist Fort Worth andlor Customer in
developing methodnlogy for cost of service studies, planning s�udies
for analyzing federal grants, and System Access Fees; provided,
howe�er, that neiti�er party shal[ request data that will require either
party to incur unreasor�able expenses in providing such da#a.
SOUTFiLAKE WHOLESALE
WATER CON7RACT
Page 29 of 32
< < .
22.1 D C�stomer may noi assign ti�is agreement without the prior written
consent of Fort Worth. Fort Worth may not assign this agreement without the prior
written conser�t af Customer; provided, however, in the evenf Fort Worth is
designated as a regional wat�r aut�ori#y or agency by a duly a�thorizec! regu[a#ory
body, or if Fork Worth should elect to cor►tract with or this contract to a regional
water authority ta provide all or part of the services co�ered by this agreement, the
participants hereta agree thaf any such regional water authority may, by way of
assignment of this agreement, assume and recei�e the same o�ligafiions and
responsibilifies, the same benefits as F�rt Worth; fur�her, Gustomer hereby grants
io Fort Warth the specif�c right to assign th�s agreeme�t to such regional wafer
aufhority.
22.91 No waiver by eith�r par�y hereto of any term or co�dition of this
agrEement shall be deemed ar construed to b� a waiver of any other term ar
condition or subsequent waiver of the same term or condi#ion.
22.12 In addition to any other remedy as may be provided by law, �his
agreement s�all be specifically enforceable by the parties hereto. Venue for any
action shall �� in Tarrant Counfy, Texas.
22.13 [t Es agreed that, in the event any term or pro�ision herein contained
is held to be in�a[id by any court af competent jurisdiction, the �nr�alEdity of such
term or provision shall in no way aff�c# any other term or provision contained
her�in; further, this agreemeni shail the� continue as if such in�aiid term or
provision hac! nof been contained her�in.
22.�4 Customer shall not provide wholesale service to any public or �ri�aie
entity holding a CCN within the corporate limits of Customer wit�out th� p.ria�
written consent of Fork Worth. Fur�her, Cusfamer shall not pro�ide retail service to
any customer residing within the boundaries of a CCN held E�y anyon� other than
Customer without the prior written consent of Fort Worth.
22,15 Fort Vllorth recognizes that fhe exist�ng pip�line located in Pearson
Lane is owned by Customer ar jointly by Customer, KeNe� and other parties.
Southfake Meter No. 1 measures the water transported by the Pearsor� �ane
pipeline a�d both Customer and the Gity ofi Keller use fhat such transported water.
SL?UTHLAKE WFEOLESA�E
WAT�R CONTRACT
Page 3Q of 32
f
Customer is responsible, however, for payment of bills �or all water measured �y
South�ake M�fer No. 1 regardless of which er�tity uses the water. Customer shall
not provide water to any other entity other than as sp�cifically permitted herein.
22.16 C�astomer vui[I be allowed a second point of delivery at the Cayior
Road ground storage reservair. The supply pipeline to be constructed in
association with �his meter, referred as Southlake Me#er No. 2, may �e connected
to t�e Pearson Lane pipeline and shared with �he City of Keller. Na refail
connections sha[I be made to t�e supply pipeline.
22.17 Customer s�all participa�e in the cost of fhe fdorthside 2-11 48-inch
pipeline construction based on fihe capacity of the pipeline, the prajected Customer
build out demand, and fhe �inal cor�struetion cost. This pipeline will originate at the
Harmon Road Elevated Tank and end at Westport Parkway, as shown on Exhibit
"B" attached herefo. This pipeline is required #o meet projected Customer demand
and Customer shall participate in the cost based on Section 3.3 of this contract.
The tofal cost estimate of the pipeline is $9,000,000 and fihe capaci�y is fi0 MGD.
Cus#omer agrees that its share ofi the pipeline based on the 20 MGD demand
projected by Customer at build out is 33% or $2,970,QOQ. C�stomer has been
pro�ided a copy af the plans, specifications and construction documents pre�ared
by Dunaway and Associates dafed 2001 #or review. Upan completion ofi
construction, Customer's costs shall be recalculated using the actual costs
incurred for consiruciion. Such recalcu�afed amoun� shaA be payable o�er a
period ofi sixty {60} monfhs and sha�l acc�ue interest af the rate of six percent
(6%} per annum f�om #he date of fihe completion and acceptance af the project
by ForE Worth. Notwithstanding, Customer may make addifional andlor early
payments without pena[ty of any type, The monthfy payme�t shalf be biEl�d by
Fort Warth with the monthly bil[ issued for wholesale water service. Should Fort
Worth ev�r t�rm�nafe fhis contract or refuse to enter into a contracf in the future
whereby �ort Worth �o Ionger Provides wholesale water serv�ce to Southlake,
Fort Worth agrees to pay Southlake for the depreciated value of this pipe�ine.
SOUTHLAKE WHOLESALE
WATER CpNTRACT
Page 39 of 32
IN TESTIM�NY WHEREOF, after proper action by the respective
go�e�'ning bodies of the par�ies 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 respecti�e parties to be hereto affixed on the date above
written.
ATT T:
r
�
lari� P rson
City S cretary
APPROVED AS TO FORM AND
LEGALITY:
l��
Assistan ity Attorney
ATTEST:
-� F,���
Kir}� �ush
A�#ing City Secretary
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APPROVED AS TO FORM AND
LEGALITY:
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Cifiy Attorney
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��j�,�,���� �uthoriza��on
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50UTHLAKE W�10LESAL�
WATER CONTRACT
Fage 32 of 32
CITY OF FORT WORTH
h
By.
Marc Ott �
;� Assistant City Manager
A�PPROVAL. RECOMMENDED;
�
Dale .�Fisseler, . �,., Director
Water Department
CITY OF SOUTHLAKE
By. �
Rick Stacy
Mayor
APPR4VAL. RECOMMENDED:
Billy�mpbell ity Manager
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DATE REFERENG� NIJMBER LOG NAM� PAG�
6125102 �_� �� ��, 60SDUTHL.AKE 1 of 2
� suB��cT UNIFORM WHOLESALE WATER CONTRACT WITH THE CITY OF SOUTHLAKE
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize the City Manager to execute a unifarm wholesale water contract with the City a#
Southlake; and
2. Authorize th� City Manager to execute an interim �D-day contract for treafied wafier service with
Southlake under the same terms and conditions contained in the current contract, if ne�essary.
D15CU5SION:
On June 24, 1987, the cities af Southla�Ce and Fart Worth entered into a contract whereby Fart Worth
agreed to provide treated water service ta 5outhlake. That contract expired on June 24, 2002.
The Water Departmenfi has offered a new uniform wholesale water contract to So�thlake that contains
the same terms and conditions that Fort Worth has with its other wholesale water customers, including
rates and the requirement that Sout�lake pay �ort Warth impact fees. Wholesale water contracts are
scheduled #o expire December 31, 201 a.
The propas�d cantract recognizes the arrangement between the cities of Keller and Southlake and tt�e
joint use af a main that transports wat�r ta both eities from the North Beach 5treet water tar�k, and that
5outhlake is responsible for payment for all water taken from tF�is main, regardless ofi whether the wafer
is used by Southla�Ce or Keller. Further, the contract also allaws for a secor�d poini af connection by
Sauthlake ta the Fort Worth 5ystem at the Caylor Road Ground 5tarage Reser►roir. In additian, the
contract provides for Southlake's participation in the constructian of the Nartnside 2-11 48-inch pipeline
based u�on the capacity of the pipeline and the projected demand on the main to be made �y
Sout�lalce. 5outhlake's share is estimated to be $2,970,000, which will be payable aver a period of 60
months and earn interest at the ra#e af 6% per annum.
Sauthlake may be unable to consider the uniform wholesa[e contract ur�til after ihe existing contract
expires. If tnat accurs, City Council appraval is sought to auihorize the Cit� Manager to execute an
interim 60-day contract with 5oufihlake under the same terms and condifians of the contrac# thaf expired
on June 24, 2002. This contract does not include the paymenf of impact fees as described above, but
does cantain a rate #hat is higher than the rate in the uniform wholesale contract.
�ity of'.�'o�t T�o�th, �'e�as
y�r� �d �����i� ������f c�Ei�r�
DATE REFERENCE NUMBER LOG NAME PAGE
������2 �-191 �4� 60SOUTHLAKE 2 of 2
sUg.��cT UNfFORM WHOLESAl.E WATER CONTRACT WITH THE CITY OF SOUTHLAKE
FISCAI. INFORMATIDNICERTIF1CATfON:
The Finance Director certifies that the Water Department and the Finance Department will be
responsible fior ihe cal[ection, deposit and recording of revenues urtder this agreement.
BG:k
Submittad fnr Cify M�nager's
Ofirce by:
FiJND I ACCOUNT I
{ta)
CENTER � AMOIJNT CITY SECRETARY
Bridgette GarretdActing
Originating Departmeot Head:
Dale Fisseler
Additional Informatioq Contact:
Dale Fisseler
G14�
�
5207 I {from)
�
8207 �
APPROV�D 06/25/02