HomeMy WebLinkAboutMedford Water Agreement 2007t ,
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AGREEMENT
THIS AGREEMENT, made and entered into in duplicate this ar~day of
20 , by and between the City of Central Point, a municipal corporation of
the State of Oregon, hereinafter termed "City," and the City of Medford, a municipal corporation of
the State of Oregon, acting by and through its duly constituted Board of Water Commissioners,
hereinafter termed "Commission," witnesseth:
and
WHEREAS, Commission treats and transports domestic and industrial waterto City;
WHEREAS, the entire service area supplied by Commission has seen substantial
customer growth which will require expansion of the transmission and treatment facilities to meet the
additional demand for water; and
WHEREAS, an equitable method of financing was established in 1994 and most
currently revised in 2005, which allows new customers to pay for their proportionate share of the
cost of this expansion and thereby minimizing the financial impact to existing users; and
WHEREAS, this method of financing applies evenly to all new customers receiving
water service from the Commission whether they are direct customers or are served by one of the
cities or districts who receive water from Commission; and
WHEREAS, Commission evaluated the alternatives and established System
Development Charges (SDCs) in 1994 to provide the equitable method of financing future plant
expansion;
FOLLOWING:
NOW, THEREFORE, THE PARTIES HERETO HEREBY AGREE TO THE
SECTION 1
Commission completed a System Development Charge Study dated September 1993,
which was revised in February 1994, May 1997, July 2001, and again in July 2005, which
determined and established the appropriate SDCs. These charges were developed in accordance
to ORS 223.297 to 223.314. City has adopted a Resolution to enact SDCs.
SECTION 2
SDCs are collected by Commission and/or City pursuant to Commission's enacting
Resolution No. 774, upon conditions such as whenever a new water service connection is installed
or whenever an existing service is enlarged. All charges collected by City will be held in a separate
account and forwarded to Commission along with an accounting of the number and sizes of the
services installed. Commission shall provide City an annual accounting of SDCs collected. SDCs
will be reviewed and updated annually in accordance with the adopting resolution or ordinances.
SDC Agreement -City of Central Point -December 2007 Page 1 of 3
SECTION 3
Commission utilizes a utility basis for determining the water rate it charges its city
customers. Under this rate analysis, City is required to pay a return on investment for its share of
the facilities paid for by Commission. In all future rate actions, facilities funded by SDCs shall not be
included in the return on investment portion of the rate analysis. This will have the effect of
moderating future water rate action to City.
SECTION 4
Commission shall render technical assistance to City in determining SDCs for large services
and other questions concerning this policy. Commission shall also be responsible for handling all
appeals related to the SDCs.
SECTION 5
This agreement shall be in full force and effect until January 1, 2013. Annually and prior to
the end of this period, all parties subject to these SDCs shall meet and fully review these charges to
be sure they are providing the alternate funding as intended. At those times, the parties may extend
or abolish the use of SDCs to fund future plant expansion. SDCs have not been increased since
2005.
SECTION 6
Commission agrees to defend City against any legal action which may arise over the
development, methodology, or implementation of the SDCs. City shall supply information and
technical support to Commission to assist it in this defense.
SECTION 7
The payment of SDCs to fund new plant construction shall not diminish the control or
ownership of the treatment or transmission facilities by Commission. The cities and water districts,
whose customers paid the SDCs, are on limited term water supply contracts with Commission. In
order to protect the interest of the cities and water districts and their customers, if City, Water District
or Commission chooses to no longer utilize the facilities funded by the SDCs, the following refund
policy shall be established:
A. Commission shall return to City or Water District where the customer resides who paid the
original SDC its prorated share of the unexpended balance of the SDC fund. This prorated
share shall be based upon the actual unexpended fees collected by City or Water District
plus the interest earned.
B. Commission shall return to City or Water District where the customer resides who paid the
original SDC a prorated share of the depreciated plant value of the SDC funded water
facilities already installed. The prorated share shall be a percentage based upon the total
amount of SDC paid by City or Water District divided by the total SDC collected which was
used to fund the facility. There will be no adjustment for the year in which the SDC payment
was made.
C. In order to avoid a financial hardship on Commission, a reasonable schedule of up to five
(5) years shall be developed for repayment of the depreciated value of the SDC-funded
water facilities.
SDC Agreement -City of Central Point -December 2007 Page 2 of 3
IN WITNESS WHEREOF, City has caused this agreement to be executed by its duly
authorized officers and City of Medford, acting by and through its Board of Water Commissioners
has caused the same to be executed by the Chair of said Commission and its Recorder as dated
above.
Date ~ ~
CITY OF MEDFORD
BY AND THROUGH ITS
BOAR F WATER COMM1SS10NERS
it
SDC Agreement -City of Central Point -December 2007 Page 3 of 3
CITY OF CENTRAL POMIT