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HomeMy WebLinkAboutCouncil Resolutions 1888RESOLUTION NO. ______ A RESOLUTION APPROVING A FIVE-YEAR EXTENSION OF THE WHOLESALE WATER SERVICE AGREEMENT BETWEEN THE CITY OF CENTRAL POINT AND THE MEDFORD WATER COMMISSION AND AUTHORIZING THE MAYOR TO EXECUTE THE LETTER OF AGREEMENT RECITALS: 1. The City of Central Point purchases wholesale water service from the City of Medford, acting by and through its Board of Water Commissioners (the Medford Water Commission), under a Wholesale Water Service Agreement effective October 1, 2016, approved by the Council under Resolution No. 1474; and 2. Article 9 of the Agreement provides an initial five-year term with three additional five- year extensions running through October of 2026, 2031 and 2036, on the same terms and conditions; and 3. The first five-year extension was executed by Letter of Agreement dated October 29, 2021, extending the term to October 1, 2026; and 4. By Letter of Agreement dated July 27, 2026, the General Manager of the Medford Water Commission has offered to extend the Agreement an additional five years at current terms and conditions, with the extended Agreement expiring October 1, 2031; and 5. The City does not operate a surface water treatment facility and relies on the Medford Water Commission for treated water supply and for treatment and transport of water appropriated under the City's own water rights, and continuity of that service is essential to the public health, safety and welfare of the City's water customers; and 6. The Medford Water Commission is currently reviewing the City's allowable water volumes under Article 1 of the Agreement, and any change to those allowances would require a written amendment executed by both parties and returned to the Council for approval; and 7. On September 8, 2026, the City transmitted a memorandum to the General Manager of the Medford Water Commission requesting that the Commission consider, at its next review of service policy under Commission Resolution No. 1058, whether conditioned domestic water connections should be available to properties within the Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 1888 Resolution No. 1888; Council Meeting 9/24/2026 Page 2 City's urban reserve areas where a documented public health hazard exists, and the Council wishes that memorandum to be made part of the record of this action; and 8. Article 5 of the Agreement requires the City to promptly notify the Commission and provide a revised service map as city limits and urban growth boundaries are modified; and 9. The Council finds that extending the Agreement for an additional five-year term is in the best interest of the City and its water customers; NOW, THEREFORE, THE CITY OF CENTRAL POINT RESOLVES AS FOLLOWS: Section 1. Approval of Extension. The five-year extension of the Wholesale Water Service Agreement between the City of Central Point and the City of Medford, acting by and through its Board of Water Commissioners, as set forth in the Letter of Agreement dated July 27, 2026 and attached as Exhibit A, is approved. The extended Agreement expires October 1, 2031. All terms and conditions of the Wholesale Water Service Agreement effective October 1, 2016 remain in full force and effect. Section 2. Authorization to Execute. The Mayor is authorized to execute the Letter of Agreement on behalf of the City, and the City Manager is authorized to take such further actions as are necessary to give effect to this Resolution. Section 3. Record of Related Matters. The Council receives into the record of this action the memorandum dated September 8, 2026 to the General Manager of the Medford Water Commission concerning limited domestic water connections within the City's urban reserve areas, attached as Exhibit B. Nothing in this Resolution commits the Medford Water Commission to any action on that request, and any resulting change to the service area provisions of the Agreement shall be presented to the Council as a separate amendment. Section 4. Direction to Staff. Staff is directed to (a) transmit to the Medford Water Commission a current map of the City's city limits and urban growth boundary in satisfaction of Article 5 of the Agreement; (b) continue to participate in the Commission's review of the City's water volume allowances under Article 1 and report the results of that review to the Council; and (c) return to the Council for approval any proposed amendment to the Agreement. Section 5. Effective Date. This Resolution takes effect immediately upon passage. Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Resolution No. 1888; Council Meeting 9/24/2026 Page 3 Passed by the Council and signed by me in authentication of its passage this 26th day of September, 2026. _________________________________ Mayor Taneea Browning ATTEST: City Recorder Exhibit A — Letter of Agreement to Extend Wholesale Water Service Agreement, dated July 27, 2026 Exhibit B — Memorandum to Medford Water Commission, Limited Domestic Water Connections Within Central Point's Urban Reserve, dated September 8, 2026 Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 9/25/2026 MEMORANDUM City of Central Point, Oregon September 8, 2026 Office of the City Manager · City of Central Point, Oregon Page 1 TO: FROM: DATE: Brad Taylor, General Manager Medford Water Commission Chris Clayton, City Manager; Stephanie Powers, Planning Director City of Central Point, Oregon September 8, 2026 SUBJECT:Limited Domestic Water Connections Within Central Point’s Urban Reserve — Request for Consideration at the Next Review of Service Policy Under Resolution 1058 Purpose Central Point is asking the Commission to take up one narrow item the next time the Board reviews service policy under Resolution 1058: whether conditioned domestic water connections should again be available to properties inside Central Point’s urban reserve areas where a documented public health hazard exists. This is a request to restore a practice the Board itself permitted until the 2016 amendment to Resolution 1058 — not to create a new one — and to restore it under materially tighter conditions than applied before 2016. We are not asking for action today, and we are not asking staff to commit to a position. We are asking that the item be placed on the review agenda with enough lead time for Commission staff to work through it, and that you tell us what verification and data the Board would want in front of it before considering such a change. The Situation Properties in several locations within Central Point’s urban reserve areas — outside the urban growth boundary, on County rural zoning — have domestic wells that have failed, tested above health-based contaminant levels, or dropped below a usable production rate. Some households are relying on hauled water for basic sanitation. These are not concentrated in one place; they occur in scattered pockets across the reserve areas, which is one reason a general policy is a better fit than case-by-case requests. A meaningful share of the affected properties has direct frontage on water infrastructure that is already in the ground — the transmission line serving the Little League fields in CP-6B is one example, but not the only one. For those lots the main is already at the property line and no extension of the system would be required to serve them. That set is inherently bounded: it can be no larger than the number of developed parcels abutting existing lines, and eligibility narrows it further to those with a documented well failure. Central Point has not completed the parcel-level inventory and will not have final figures before we meet, but we Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Memorandum to Medford Water Commission — Urban Reserve Water Service Office of the City Manager · City of Central Point, Oregon Page 2 will have the count, the ERU total, and an estimated daily demand in front of the Board before it is asked to consider any change. Central Point can provide a map showing the reserve areas, the existing infrastructure, and the affected properties. If that would be useful to Commission staff or to the Board, tell us the scale and detail you want and we will prepare it. Prior Board Policy and the 2016 Amendment We think the most relevant precedent for this request is the Commission’s own. Prior to the 2016 amendment to Resolution 1058, Board policy permitted connections of this kind. The restriction now in place is the product of that amendment, not of a state mandate and not of a change in the underlying land use rules — OAR 660-011-0065 has been in effect since 1998, and the operative language of OAR 660-021-0040(6) predates 2016 as well. That history matters in two ways. First, it establishes that the Board has already concluded, at least once, that such connections could be furnished consistently with its obligations. Second, it supplies an evidentiary record: whatever concerns motivated the 2016 change can be tested against what actually occurred during the years the prior policy was in effect. We would welcome the Commission’s account of the reasoning behind the 2016 amendment, and if there were specific problems the change was meant to solve, we would rather design around them than relitigate them. What we are proposing is narrower than the pre-2016 policy in every direction we are aware of: eligibility limited to documented health hazards rather than available on request, a hard one-ERU capacity cap, recorded density covenants, and independent enforcement rights held by the Commission. What the State Land Use Rules Provide Because the question is sometimes framed as one of state land use compliance, our Planning Director reviewed the applicable rules. They do not appear to prohibit the connection. We set out the relevant provisions below so the Commission can evaluate the language directly rather than rely on our characterization of it. OAR 660-011-0065 — Water Service to Rural Lands. This rule contemplates that water systems will extend to lands outside an urban growth boundary. What it prohibits is a land use consequence: local regulations may not allow an increase in base residential density, a higher density than would otherwise be authorized, or any density increase attributable to the presence, establishment, or extension of a water system. The rule constrains the zoning outcome, not the pipe. Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Memorandum to Medford Water Commission — Urban Reserve Water Service Office of the City Manager · City of Central Point, Oregon Page 3 OAR 660-021-0040(3) — requires that land use regulations prohibit zone amendments allowing more intensive uses, including higher residential density, within urban reserves until the land is brought into a UGB. OAR 660-021-0040(2)(d) — expressly identifies written waivers of remonstrance against annexation to a provider of sewer, water, or streets as an accepted urban reserve management tool. OAR 660-021-0040(6) — the provision most directly on point. It contains two sentences that must be read together: “Cities and counties are authorized to plan for the eventual provision of urban public facilities and services to urban reserves. However, this division is not intended to authorize urban levels of development or services in urban reserves prior to their inclusion in the urban growth boundary. This division is not intended to prevent any planning for, installation of, or connection to public facilities or services in urban reserves consistent with the statewide planning goals and with acknowledged comprehensive plans and land use regulations in effect on the applicable date of this division.” Central Point’s reading is that the rule draws a line between the physical connection, which it does not prevent, and the urban level of development or service, which it does not authorize. A single-family domestic hookup to an existing main, capped at one equivalent residential unit and carrying a recorded prohibition on any density gain, is on the permitted side of that line. We recognize the Commission may read it differently, and the first sentence of the subsection is the one your counsel will focus on. That is a fair argument and we would rather have it in the open. Why We Believe This Is a Policy Question for the Board If the state rules do not foreclose the connection, then the constraint is contractual and discretionary rather than legal. The 2016 amendment points to the same conclusion: a policy the Board adopted and later changed is, by definition, a policy the Board controls. We raise that observation as the reason the item belongs in a service policy review, not as a criticism of the Commission’s current position. The Medford Charter grants the Board authority to furnish water service to users both within and without the city on such terms and conditions as the Board determines to be in the best interests of the city. That is broad discretion. It means the Board is free to say no on policy grounds — but also free to say yes, on conditions of its own design, without waiting on a UGB amendment. Proposed Framework Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Memorandum to Medford Water Commission — Urban Reserve Water Service Office of the City Manager · City of Central Point, Oregon Page 4 The framework below is offered as a starting point and is entirely subject to Commission revision. It is built on one organizing principle: the administrative burden, the verification work, and the enforcement exposure sit with Central Point, while the Commission retains independent authority to stop anything it does not want. Phase Scope Approval Path Phase 1 Tax lots anywhere in the urban reserve areas with direct frontage on existing water infrastructure. Tap only; no extension of the main. Administrative approval by the City after health-hazard verification; recorded encumbrances delivered to the Commission before activation. Phase 2 Non-frontage properties in the urban reserve areas with verified well failure where a short lateral extension would be required. Verified health cluster compiled by the City, confirmed by Council resolution, then affirmative approval by the Board of Water Commissioners. No extension without your vote. Every connection under either phase would carry the following controls: Control Mechanism Effect for Medford Water Health-hazard gate Lab results above OHA or EPA maximum contaminant levels, or well failure certified by a licensed Oregon driller, hydrogeologist, or professional engineer. No hardship claims and no convenience connections. Eligibility is evidentiary, not discretionary. Capacity cap One ¾-inch domestic meter per tax lot, capped at one ERU, domestic residential use only. No commercial, industrial, or high-volume agricultural draw. Demand is bounded and predictable. Density covenant Recorded covenant replicating OAR 660-011-0065(2) and 660-021-0040(3); bars subdivision, partition, and ADU connections while outside the UGB. The connection cannot be used as evidence supporting a density increase, which is the outcome the state rules protect against. Consent to annexation Irrevocable consent and waiver of remonstrance recorded against title, per OAR 660-021-0040(2)(d). Every connection becomes an in-city customer automatically on UGB inclusion, with consent already in hand. Independent enforcement Medford Water named as an intended third-party beneficiary of the covenant, with standing to enforce and to terminate service after notice. The Commission is never dependent on Central Point choosing to act on a violation. Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Memorandum to Medford Water Commission — Urban Reserve Water Service Office of the City Manager · City of Central Point, Oregon Page 5 Concerns We Expect — and Our Response We would rather name these than have them surface after the Board has already formed a view. Precedent. If Central Point obtains an addendum, other cities served by the Commission will ask. We think that is true and we are not going to argue otherwise — which is why we would support a system-wide policy rather than a Central Point-specific addendum, and would help develop one. It is also worth noting that the pre-2016 policy applied generally and the Commission has direct experience with how that worked in practice. Beyond that, the health-hazard gate is our answer: it is narrow, it is evidence-based, and it cannot be used as a growth tool, because a documented well failure is a condition no developer can manufacture. Supply planning. These connections are not in a demand forecast built on UGB-based growth. We would like to understand what incremental volume, if any, is small enough to be immaterial to the Commission’s planning, and we commit to sizing the eligible set before the Board is asked to act, so that it votes on a number rather than a concept. If Commission staff would rather define the methodology for that estimate than react to ours, we will use yours. Ratepayer equity. Connections would pay standard system development charges and standard outside-city rates. We are not asking the Commission’s ratepayers to subsidize rural service. Administrative burden. Central Point compiles the health record, verifies the documentation, records the encumbrances, and carries the enforcement obligation. What the Commission receives is a completed file and independent rights it can exercise at its discretion. What We Are Asking For That this item be placed on the agenda for the Commission’s next review of service policy under Resolution 1058. That Commission staff share the record behind the 2016 amendment — the concerns it was meant to address and any experience under the prior policy that informed it. If the change was made to solve a real problem, we would rather build the fix into our proposal than argue past it. That Commission staff tell us what evidence, volume analysis, mapping, or legal review the Board would want assembled in advance, so the item arrives complete rather than in pieces. Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7 Memorandum to Medford Water Commission — Urban Reserve Water Service Office of the City Manager · City of Central Point, Oregon Page 6 A staff-level conversation before the review, so that objections can shape the proposal rather than defeat it. Draft addendum, covenant, and verification protocol language, along with mapping of the affected areas, is available on request. Any amendment to the parties’ water service agreement would of course be subject to review by counsel for both the City and the Commission and to approval by both governing bodies. I would welcome the chance to discuss this with you directly. Respectfully, Chris Clayton City Manager City of Central Point, Oregon (541) 664-3321, ext. 207 Docusign Envelope ID: 48ED37E9-4065-81D8-818A-07100E1636E7