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Home My WebLink About1993.03.02_OPWA AgendaNOTICE OF PUBLIC MEETING The Owasso Public Works Authority will meet in regular session on Tuesday, March 2, 1993 at 7:00 p.m. in the Council Chambers at the Owasso Community Center, 301 South Cedar, Owasso, Oklahoma. Notice filed in the office of the City Clerk and posted on the City Hall bulletin board at 4:00 p.m. on Friday, February 26, 1993. 10. 1 M Boutwell, City Clerk AGENDA 1. Call to Order 2. Flag Salute 3. Roll Call 4. Request Approval of the Minutes of February 16, 1993 Regular Meeting Attachment #4 5. Request Approval of Claims Attachment #5 Owasso Public Works Authority March 2, 1993 Page 2 6. Consideration and Appropriate Action Relating to a Request for the Purchase of Safety Equipment. Mr Augustine Attachment #6 Staff will recommend Trustee approval of the Expenditure of $1243 to Wayest Safety, Inc for the purchase of one "self- contained" breathing unit, and an expenditure of $2078 to BARCO, Inc for the purchase of one "Entry Tripod and Accessories ". 7. Consideration and Appropriate Action Relating to an Agreement Between the Owasso Public Works Authority and Rogers County Rural Water District #3, Providing for the Purchase of Certain Portions of the Water District's Service Area. Mr Ray Staff will present a concept for Trustee consideration and will recommend a course of action during that presentation. 8. Report from OPWA Manager 9. Report from OPWA Attorney Owasso Public Works Authority March 2, 1993 Page 3 10. Unfinished Business 11. New Business 12. Adjournment ' OWASSO PUBLIC WORKS AUTHORITY MINUTES OF REGULAR MEETING Tuesday, February 16, 1993 The Owasso Public Works Authority met in regular session on Tuesday, February 16, 1993 in ' the Council Chambers at the Owasso Community Center per the Notice of Public Meeting and Agenda posted on the City Hall bulletin board at 4:00 p.m. on Friday, February 12, 1993. a ITEM 1: CALL TO ORDER Chairperson Marlar called the meeting to order at 8:17 p.m. ITEM 2: FLAG SALUTE The flag salute was held during the Owasso City Council meeting preceding this meeting. ITEM 3: ROLL CALL ' PRESENT ABSENT STAFF Patricia Marlar, Chairperson Jim Smalley, Trustee Rodney J Ray, City Manager Jason Gittelman, Vice Chairperson Ronald D Cates, Attorney John Phillips, Trustee Marcia Boutwell, Secretary Bob Randolph, Trustee A quorum was declared present. ITEM 4: REQUEST APPROVAL OF THE MINUTES OF FEBRUARY 2. 1993 REGULAR MEETING John Phillips moved to approve the minutes as written, by reference hereto; seconded by Jason Gittelman. AYE: Phillips, Gittelman, Randolph, , Marlar NAY: None Motion carried 4 -0. IITEM 5: REQUEST APPROVAL OF THE CLAIMS John Phillips moved, seconded by Jason Gittelman, to approve the following claims as submitted: (1) $19,613.61 and (2) Payroll $17,934.89. AYE: Phillips, Gittelman, Randolph, Marlar NAY: None Motion carried 4 -0. Owasso Public Works Authority February 16, 1993 ITEM 6: CONSIDERATION AND APPROPRIATE ACTION RELATING TO AN AGREEMENT BETWEEN THE OWASSO PUBLIC WORKS AUTHORITY AND ROGERS COUNTY RURAL WATER DISTRICT #3 PROVIDING FOR THE PURCHASE OF CERTAIN PORTIONS OF THE WATER DISTRICT'S SERVICE AREA. Mr Ray presented this item stating that discussions have been held with Rogers County Rural Water District staff relating to the acquisition of certain portions of the District as the City's growth moves into the District's service area. It is proposed that the City of Owasso acquire, at this time, approximately 1' /z sections of primarily undeveloped land in the area immediately north of Owasso High School and east of 129th East Avenue. A contract has been developed and reviewed by staff and the city attorney. Questions raised by the Trustees included a concern with the rural water district insisting that their existing customers in the service area be given city rates instead of out -of -city rates. This would create two classes of rural water customers, giving one class preferential treatment over the other. Concern was also expressed about making a lump sum payment, with a question raised about where the funds will come from for that payment. The developer of the land in that area, Nobel Sokolosky, was present and answered questions presented to him by the Trustees. Mr Sokolosky requested that this item be tabled. Following discussion John Phillips moved to table this item to the next regular meeting. Motion was seconded by Bob Randolph. AYE: Phillips, Randolph, Gittelman, Marlar NAY: None Motion carried 4 -0. ITEM 7: CONSIDERATION AND APPROPRIATE ACTION RELATING TO A PRESENTATION REGARDING THE CONTINUATION OF A YARDWASTE SEPARATION PROGRAM Mr Augustine and Mr Knebel presented this item. In November 1992 a special project review committee was established to evaluate the City's yardwaste separation program. Based on that review, staff is recommending continuation of the program, purchase of polycarts for yardwaste, and purchase of 40,000 yardwaste bags for delivery in July. The committee also proposed a fully permitted Health Department approved compost project and a comprehensive marketing plan to inform the citizens of all aspects of the program. Following discussion John Phillips moved to continue the yardwaste /compost program; to include the option of yardwaste -only red polycarts for those citizens who wish this option and to proceed with the purchase of 100 of the polycarts; to authorize staff to prepare bid information for 40,000 city - approved yardwaste bags for delivery in July; and to proceed with soil testing on a compost site with the cost not to PA Owasso Public Works Authority February 16, 1993 W ' exceed $1500 for that testing, with staff reporting back to the Trustees as they pursue a permit for a compost site. Motion was seconded by Jason Gittelman. ' AYE: Phillips, Gittelman, Randolph, Marlar NAY: None IMotion carried 4 -0. ITEM 8: CONSIDERATION AND APPROPRIATE ACTION RELATIVE TO A ' REQUEST TO PURCHASE 100 RED POLYCARTS Staff has solicited quotes for a bulk purchase of red refuse carts for use by yardwaste separation program customers. The specifications call for a unit price quote for a 90 gallon minimum size, ordered in amounts of 100, with a guaranteed unit price for one year from Notice of Award and ' a delivery date of April 1, 1993. Quote requests were mailed to four vendors, with two responding. After reviewing the quotes, as well as the polycarts from both vendors, staff recommended purchase of 100 red polycarts (poly -kart 2000), 90 gallon size, for a unit price of $61.00 and a lump sum price of $6100.00 from Williams Refuse Equipment Co. John Phillips moved, seconded by Jason Gittelman, to approve the polycart purchase per staff recommendation. AYE: Phillips, Gittelman, Randolph, Marlar NAY: None Motion carried 4 -0. ITEM 9: CONSIDERATION AND APPROPRIATE ACTION RELATING TO A REQUEST FOR AUTHORIZATION TO SOLICIT BIDS FOR THE PURCHASE OF YARDWASTE COLLECTION BAGS Mr Augustine stated that the City currently has an inventory of 12,000 yardwaste bags on hand in anticipation of the upcoming yardwaste separation program. It is projected that these bags should last until July 1993. Staff believes that the purchase of a larger quantity of bags (40,000) would be the most cost effective method to use. John Phillips moved, seconded by Jason Gittelman, to authorize the solicitation of bids for 40,000 yardwaste collection bags for delivery in July 1993. AYE: Phillips, Gittelman, Randolph, Marlar NAY: None ' Motion carried 4 -0. 3 Owasso Public Works Authority ITEM 10: REPORT FROM OPWA MANAGER No report. ITEM 11: REPORT FROM OPWA ATTORNEY No report. ITEM 12: UNFINISHED BUSINESS None ITEM 13: NEW BUSINESS None ITEM 14: ADJOURNMENT Jason Gittelman moved, seconded by Chairperson Marlar to adjourn. AYE: Gittelman, Marlar, Randolph, Phillips NAY: None Motion carried 4 -0 and the meeting was adjourned at 9:30 p.m. Marcia Boutwell, Secretary 4 February 16, 1993 Patricia K Marlar, Chairperson CITY OF OWASSO OWASSO PUBLIC WORKS AUTHORITY 2/25/93 16:34:38 A/P CLAIMS REPORT APAPVR PAGE: PO # VENDOR DESCRIPTION AMOUNT ---- - - - - -- ------------------- - - - - -- ------------------- - - - - -- - - - -- * NO DEPARTMENT MASTER FOUND * ------------------------ - - - - -- 931746 OPWA RECYCLE CENTER REIMS CASH DRAWER 940.18 DEPARTMENT TOTAL =___> 940.18 OPWA ADMINISTRATION 930024 CPS BUSINESS, INC. LIC & ASSIST FEE 217.00 930292 MEMBER SERVICE LIFE MONFHLY FEES 33.00 DEPARTMENT TOTAL =___> 250.00 WATER 931617 ROBERT M BUCKLES METER READER 251.10 931618 BOBBY TAYLOR METER READER 352.80 931619 OSCAR MCLAURIN METER READER 211.50 931744 TREASURER PETTY CASH REIMB PETTY CASH 3.00 931784 SOUTHWESTERN BELL TELE. 1/93 PLEXAR 91.69 931785 PSO 1/93 USE 182.62 DEPARTMENT TOTAL = = = => 1,092.71 WASTEWATER -------------------- - - - - -- 931493 GRAINGER,W W INC SUPPLIES 91.25 931662 TRAVEL PETTY CASH COSHATT /WATER SCHOOL 67.80 931744 TREASURER PETTY CASH REIMB PETTY CASH 5.31 931783 OKLA NATURAL GAS 1/93 USE 112.57 931784 SOUTHWESTERN BELL TELE. 1/93 PLEXAR 246.02 931785 PSO 1/93 USE 6,170.31 931786 LDCC INC -AT &T 1/93 LONG DISTANCE 6.56 DEPARTMENT TOTAL = = = => 6,699.82 REFUSE COLLECTIONS -------------------- - - - - -- 931530 WILLIAMS REFUSE EQUIPMENT POLYCARTS 6,457.50 93091 CINTAS CORP. UNIFORM CLEANING /RENTAL 119.80 10 CITY OF OWASSO OWASSO PUBLIC WORKS AUTHORITY 2/25/93 16:34:38 A/P CLAIMS REPORT APAPVR PAGE: 11 PO # VENDOR DESCRIPTION AMOUNT - -- ------------------- - - - - -- ------------------- - - - - -- ------- - - - - -- 931694 HANES SHOE & ARCH SHOP BOOTS 931711 WASTE MANAGEMENT OF OKLA 1/93 COMM WASTE 931724 WASTE MANAGEMENT OF OKLA 1IP FEES DEPARTMENT TOTAL =___> RECYCLE CENTER ------------------------ - - - - -- 931572 COMPUADD 931591 CINTAS CORP. 931711 WASTE MANAGEMENT 931724 WASTE MANAGEMENT 931784 SOUTHWESTERN BELI 931785 PSO SUPPLIES UNIFORM CLEANING /RENTAL OF OKLA 1/93 COMM WASTE OF OKLA TIP FEES TELE. 1/93 PLEXAR 1/93 USE DEPARTMENT TOTAL =___> 108.50 15,953.00 2,235.27 24,874.07 195.99 28.40 1,110.00 81.60 22.73 244.60 1,683.32 FUND TOTAL =___> ' 5,540.10 I OWASSO PUBLIC WORKS AUTHORITY PAYROLL PAYMENT REPORT PAY PERIOD ENDING DATE 02/20/93 DEPARTMENT AMOUNT ............::.,• :::: n� :::::::::::::::::. v.}}}}}:.:;;; .•: {• }:. },:., }, } } }: { {. }:{:;:..: •r:.. •;: c::....., •.x.':.: {.::::... •... {.:., �y, mw} xu,.:: �: xoz8° he;.: ao�c::{• xt: m} r.+.?; :�:,�sv«a:: }::;:.::::K•: {{ {.»:: .............., "::::.. n,::.. �..:....:.: :.....::,,...•...,.....:;.k. }:. co-.:; s}}:{ eawa:. ti{•}...:•. fo:•.::, u}» c: l!•b:f:{Eura�;aio�uc�u>o'°°c.''• Water 31397.69 :.•r.:.:•Ci.: ':• i..';:"? �:> �F". ec` �::};• w,^:`• i:;:, dc;:?',: 'tt�::�t;.'•;:;.5`:s <'4cna.^.C: M1:�:t,•• . ,.'0�.,c : 3;. ati�5' r,: 3' ��: �; n$....°,:,,.. iRC;; �a .'•,.••+w.}'.•,'...';::�"<.•••} }..•, r:•.•:. r: cn}•,{{:•: r.:•:: ah•:. x•::.:.,•n•::::r{•:.::::.,. } }•. :. xc,,::::a: }: {ii::;ii<; >:. t.:,' , }:;c::'t: } #;rv;.: •.. . }:.:{.;.:, •:;'t +:•,'Ca}, };y ; �� . #:.Yr, {...:: •.0.:.}.:: n:: }... 'Y'.•r•'�.... %,..n..XC :r'C• {: {�'�} � •{�(� ' !� ... ...•` ....i:n:::i:•'i':t::`.�:!::i'in ::::`n ':'r,`. {:t { {•}: i::::: r{.; r.::n ";f.'; }.i:= 'i:::• ...... i'i.,+yy : 4F3T��• k;: L:' i:: 3:::: LL: isSi:%':. Y::{ 4: L}:{.:.:•}:::: b:•:•: J:.}}}: 4} :v } }:• }:{{ri{•:iG:•}::�:rivk✓� ?:$ ':{::.:. v: rr} rn.}:::.•. u :•ni:�3 } :.•J.4 }:{v::• }n''w}}e., Refuse 2,965.63 ��:::};: �.:•::}:{.:.: �}: >:::• }:::::.�:.:.:n.:.:.::::::. �:::: r::::: «• }::.,, v.•n•:..vN....,:v:r.,w,.,.G��ir }h i:.} }Cv..,•.. J.vi{.} }'i•'J 'k.b }:•:v}:{Ch � }.,,:{jK, �} +C::,v.:: {} }:;i} iii}'J, rti.,'.{•:. v,} {• };r,'tiii:::'r•ii1 }:4:• } %v. �{ ;. .. '.... } .> v} .:> .: ::. v}:::::: { { { { {:4•• },v,• } }:..:nr<}: fi::i:• }::::..::: }:... n.:r•: •.: x.{.: n::.;: ::.:.i' ............... L.:{•: vitiGi}::}:{ i.}:{ ti{{{•} wi..}:•}:{ 2•.• hm•: n•.. Kw{' rit{ •} :vv.{•nw.•mnv. :rJ�nx:.rxv}.vw \ti.x...:nnx. ... APPROVED: 03/02/93 Chairman Trustee Trustee MEMoxnrmuM 1 TO: HONORABLE CHAIR AND TRUSTEES ' OWASSO PUBLIC WORKS AUTHORITY IFROM: MIKE AUGUSTINE, OPWA DIRECTOR SUBJECT: CONFINED SPACE ENTRY EQUIPMENT DATE: February 24, 1993 IBACKGROUND: The Wastewater Department has begun implementation of a "Confined Space Entry" program ' (see attachment). This program requires that employees assigned to work in and around confined spaces (sanitary sewer manholes, etc.) to be adequately trained and protected from the hazards that may be encountered. ' The program was to define the parameters of a confined space, determine OSHA standards and P g P the type of equipment needed for the program. The Confined Space Entry program has set the ' safety needs and procedures and the purchase of two -way handpacked radios as the first phase. For Phase II of the program the following equipment is required: 1. One (1) self - contained breathing apparatus, single cylinder system, single supply hose system, Type C supplied air respirator, and a five (5) minute emergency air cylinder (NIOSH/MHA approved). 2. Confined space entry tripod with safety harness, lifeline retriever and carrying bag. FUNDING: ' The FY 1992 -93 Wastewater Department budget allocated funding for the purchase of this equipment through Capital Outlay Line Item #5441. ' QUOTES: ' Staff has received written quotes and verbal follow -ups from four separate companies capable of supplying the above listed equipment and they are as follows: MEMORANDUM EQUIPMENT Page 2 "SELF- CONTAINED BREATHING EQUIPMENT" WAYEST SAFETY, INC. $1,243.00 CHIEF FIRE & SAFETY CO. $1,728.00 UTILITY SUPPLY OF AMERICA $1,881.00 OK WEIS AMERICAN FIRE EQUIPMENT $2,899.00 "TRIPOD, HARNESS, LIFELINE, CARRYING CASE EQUIPMENT" BARCO $2,078.00 WAYEST SAFETY INC. $2,555.00 UTILITY SUPPLY OF AMERICA $2,892.25 CHIEF FIRE & SAFETY CO. $3,105.00 RECOMNMNDATION: Staff recommends that the Trustees approve the expenditure of $1,243.00 to Wayest Safety, Inc. for the purchase of one "self- contained" breathing unit; and an expenditure of $2,078.00 to BARCO, Inc. for the purchase of one "Entry Tripod and Accessories ". ATTACHMENTS: 1. Air supply information. 2. Tripod and accessory information. 3. Confined Space Entry policy. 1 JOB SITE SAFETY CONFINED SPACE ENTRY It is the policy of this Department to require all employees assigned to work in and around confined spaces to be adequately trained and protected from the hazards that may be encountered. All persons including supervisors, foremen, leadmen, and management working in or around confined spaces shall rigidly follow the procedures set forth in this Policy. DEFINITIONS 1. Confined Space: Any space having a limited opening for entry or exit, which does not have sufficient natural or mechanical ventilation to prevent accumulation of toxic, combustible, or oxygen deficient atmospheres. "Confined spaces" include but are not limited to: a. Storage tanks, bins, boilers, and other tank like compartments usually with only a manhole for entry. b. Open- topped spaces of more than 4 feet in depth such as pits, vaults, and vessels not subject to adequate ventilation. c. Septic tanks, sewers, underground utility tunnels, pipelines and similar structures. 2. Oxygen Deficient Atmosphere: atmosphere that contains less, than 19.5% oxygen. 3. Toxic Atmospheres: atmospheres having concentrations of airborne contaminants in excess of the Permissible Exposure Limits (P.E.L.), as noted in OSHA Standards for General Industry 29 CFR 1910.1000. 4. Combustible Atmo ihe e ; atmospheres in ex, of 2r),., the L.E.L. (Lower Explosive Limit). Ci.:,ntaminant: any organic or inorganic substance, dust, fame, mist, vapor, or gas, the presence of which, in air, be harmful or hazardous to human beings. F5 lified 'Fe rson: one who by reason of training and rience is tamil i ar faith pro per confined space entry proCedures and hazard's involved; including proper Operation of all equipment to be. used. I JOB SITE 'SAFETY Permit System ' Entry into a confined space shall be by permit only (see attached Entry Permit). The permit is an authorization and approval in ■ writing that specifies the location and type of work to be done, and certifies that all existing hazards have been evaluated by a qualified person, and necessary protective measures have been taken to ensure the safety of each worker. The qualified person shall be responsible for securing the permit and shall sign off before work is started. The permit shall be updated for each shift with the same requirements applying. It must be noted that the individual signing the confined space entry permit ,cannot be the same person entering the confined ' space. fur T 5 r jy�' 1 TO: THE CHAIRPERSON AND TRUSTEES 1 OWASSO PUBLIC WORKS AUTHORITY IFROM: RODNEY J. RAY ' SUBJECT: AGREEMENT BETWEEN OPWA AND ROGERS COUNTY RURAL WATER DISTRICT PROVIDING FOR ACQUISITION OF ONE AND ONE - HALF SECTIONS OF RRWD SERVICE AREA DATE: FEBRUARY 25, 1993 ' BACKGROUND: During the February 16, 1993 meeting of the OPWA, the staff presented a proposed agreement ' that would provide for the transfer of approximately one and one -half sections of land from the Rogers County Rural Water District service area to the OPWA (City) service area. During a discussion of the issues, it became apparent that there were some very basic concerns relating ' to the proposal. The Trustees did not take action on the proposed agreement, other than to table the matter and refer it back to staff for additional development. For the past two weeks, I have worked to develop a plan of action that would address the concerns expressed by the Trustees and allow the acquisition to proceed. At the time of this writing, a final proposal has not been fully developed and accepted by the other parties involved ' in the matter. There has, however, been a significant amount of discussion and there is a framework in place that provides a basis for continuing the process. The staff continues to strongly support the acquisition of the service area as a sound business investment that will produce increased revenues as the area is developed. ' At this point, I am working from the concept that a long -term equalization of the "rural" water rates, using a phased -in process of reducing those rates, would be acceptable to the Council. The basis for this part of the concept lies in a "revenue neutral" proposal that would call for the reduction of rates for the City's "outside" customers by the exact amount of revenue produced by the new customers gained from the Water District. Under this plan the Trustees would agree to rate protection for the new customers and would make a long -term commitment to existing rural customers for continued rate reductions based on added customers from the acquired service area. Initially, the staff's calculations indicate that the rate reduction for those customers would be between $3.50 and $5.00 per month (that range is based on average usage and could be slightly impacted by actual usage after a one -year history is acquired). Staff discussions with ROGERS COUNTY RURAL WATER DISTRICT ACQUISITION FEBRUARY 25, 1993 PAGE TWO some of the parties involved indicate that this portion of the concept is being well received, in fact, the basic concept was initially suggested by a Trustee. The ' second part of the concept revolves around the payment of $49,750 to the District for the service area. There is obvious concern relating to the requirement of an up -front payment. As you may recall during the discussion, one developer mentioned that his development company ' would be willing to advance fund a portion of the lump sum payment. I have held discussions with the principles of that firm, and, as of this point, do not have a firm proposal to make regarding their level of commitment. Discussions have ranged form a 50 -50 (50% developer ' and 50% City) advance funding to a 100% developer- funded plan. There are serious doubts that we can achieve a 100% advance - funding by the developer unless there is some method of them to be compensated for the cost of the money used to fund the buy -out. While that is a viable possibility, it has not been discussed with the Trustees. Additionally, the developers are not comfortable with advancing funds for the buy -out without a clearly defined time limit on the repayment of those funds. Generally, a time period of three years has been suggested as a reasonable time for the City to pay back the advance funding. The staff estimates that a $100 increase in tap fees would produce approximately $ during the first three years (based on existing development projects encompassing an estimated 178 lots in Windsor I, Windsor II, Brentwood and a 50 acre unnamed addition in the planning stage). Central to resolving this issue are three questions that only the Trustees can answer. First, is the issue of whether or not the Trustees are receptive to advance funding a portion of the initial $49,750 acquisition cost, and if so, how much of that cost are the Trustees willing to advance? Second, are the Trustees willing to provide some repayment of the cost of the money the developer would advance? If this is acceptable, how much of that cost would the Trust be willing to make available? Thirdly, what time frame for repayment of an advance funding is I acceptable to the Trustees? The staff is of the opinion that a consensus can be reached on all of the basic points of this ' agreement and a recommendation will be presented to the Trustees at the meeting. I believe that the recommendation will include the "revenue neutral "/rate reduction proposal, an increase in tap fees for the acquired area, an advance funding of the purchase price by the developer, with ' a payback of that advance funding over a three year period and with some additional payback to cover the cost of the advance funding. However, an option to that recommendation could include only a partial advance funding of the purchase price by the developer with no t consideration of re- payment of the cost of the money. That option would, however, include a recommendation that the Trustees invest funds for about half of the purchase price. Such cost would be recovered from additional tap fees in the area under discussion. ROGERS COUNTY RURAL WATER DISTRICT ACQUISITION FEBRUARY 25, 1993 PAGE THREE ' I have attached the proposed contract between the OPWA and the District for your review. I view this issue as being critical to the future of Owasso and want you to know that I am available at your convenience to discuss the matter with you. If you have questions, please call Mr. Compton, Mr. Augustine, Ms. Bishop or me. ' RECOMMENDATION: A recommendation will be made at the meeting. tATTACHMENT: 1. Proposed agreement 2. Memorandum dated February 12, 1993 1 JAMES W. S UAL MERLIN,, P. C A Professional Corporation I Dwayne Steidley Attornev at Law Associate 501 West First Street (918) 341 -2657 P. O. Box 99 Of Counsel to: FAX: 341 -8550 Claremore, Oklahoma 73018 Williams & Marlar, P.C. February 12, 1993 re: Rural Water District No. 3 Contract Owasso Public Works Authority Owasso, Oklahoma Attn: Rodney Ray Dear Mr. Ray: ' The Board of Directors of Rural Water District No. 3, Rogers County, Oklahoma met on February 9, 1993 and approved the enclosed ' Contract for the sale of a part of the District to the Owasso Public Works Authority. It was voted to extend the offer of sale, as per contract terms, until the 15th day of April, 1993. If the Contract is not accepted on or before this date, the offer will be withdrawn and the District will undertake some long range planning to provide adequate service to the area involved. It would be appreciated if you could act on the offer as soon as possible as much remains to be done before we can have an actual closing. Please note that I have provided in the contract that the closing must be within 180 days or such extension of time as may be agreed to between the parties. Please advise if you have any questions. Yours very truly, JAM S W. SUMMERLIN y_P. C. By: Jdmes W. `-3'um eriin "L Encl. Contract Documents cc: RWD # 3, Rogers County Ray Murray, Engineer CONTRACT THIS CONTRACT made and entered into this day of February, 1993, by and between RURAL WATER DISTRICT NO. 3, Rogers County, Oklahoma, party of the first part, hereinafter referred to as "DISTRICT', and THE OWASSO PUBLIC WORKS ' AUTHORITY, a Public Trust, of Owasso, Oklahoma, party of the second part, hereinafter referred to as "AUTHORITY ". ■I WITNESSETH: WHEREAS, District is a duly incorporated Rural Water District, and whereas, Authority is a duly authorized Public Trust, both created under the authority of the Statutes of the State of Oklahoma; and, WHEREAS, District is operating a Rural Water District in Rogers County, Oklahoma, and Authority is distributing water in an area partially located in Rogers County, Oklahoma; and, WHEREAS, it has been deemed by both the Boards of District and Authority to be in the best interest of all parties concerned, that District deannex a portion of its area now I being served, based upon its inability to properly provide service to its customers, and to sell and transfer that portion of its system to Authority, said legal description of the area to be deannexed and transferred, and the property and equipment to be transferred, all as described and set forth in Exhibit "A" attached hereto and incorporated herein and made a part hereof; and, WHEREAS, Authority is equally desirous of purchasing same, NOW THEREFORE, in consideration of the mutual covenants, promises and tagreements, the parties hereto agree as follows: 1. District will cause the property described on Exhibit 'W'to be deannexed from Rural Water District No. 3, Rogers County, Oklahoma, by the proper statutory procedures. Said deannexation to be completed prior to 180 days from the date this contract is signed by all parties. The Parties agree to agree on a date of closing within 180 days from the 1 date this agreement is signed by all parties or any extension is made in writing signed by both parties. In the event deannexation is delayed, and the closing provided is not accomplished within said 180 days from the date this contract is signed by all parties, or unless the time is extended by all parties, then this Contract shall be void. District will convey all of their right, title and interest in and to their presently owned ri_,hts of way and easements, and all lines, meters and equipment, as described in Exhibit "X% and include any equipment now in place or to be in place on the date of closing, or to such time as the closing may be extended as provided in Paragraph 1 above, upon the terms and conditions hereinafter set forth. 3. District will provide Authority with such maps, plats and engineering drawings that they may now have in their possession, and reasonable personal assistance to Authority in the location of said meters, lines, easements, rights of way, and equipment. 4. Both District and Authority agree the transfer will take place at 8:00 a.m. or. a closing date to be agreed upon within said 180 day period or any extension thereof. Until said time, District shall be responsible for the furnishing of service to its customers and shall be liable for any such operation and shall be entitled to accumulated billings until 8:00 a.m. on the date of closing. District agrees to provide a final reading on or before that time and a final billing rendered to customers. It is specifically agreed that if payment of the final billing, as prepared and billed by District, comes into the hands of Authority, Authority will forthwith account and pay over to District any such sums acquired by them. The closing date as herein set forth may be extended in accordance with the provisions of Paragraph 1 above. 5. District agrees to make proper conveyance to Authority by assignment of its easements and rights of way and by proper Bill of Sale in and to all personal property and equipment, all as described in Exhibit "A" attached hereto. District makes no warranty, express or implied, as to the title to the real property, rights of way, easements to be conveyed by them to Authority, except that it has the right to assign such rights of way and easements and it will warrant title to the personal property, lines, meters and equipment as described on Exhibit "A ". Authority will have a reasonable time to inspect and test such equipment and lines, but District makes no warranty, express or implied, of the condition of the lines, meters and equipment. 6. District states and represents that the property conveyed is subject to a lien and that they will obtain a release of said lien from the Farmers Home Administration, satisfactory to Authority of the area to be deannexed and the property to be sold and conveyed to Authority under the terms and conditions hereinafter set forth. 7. Authority agrees to provide water service to the present customers in the deannexed area at the same rate as that charged to water customers within the limits of the City of Owasso, Oklahoma. Authority agrees to accept Benefit Units from District members in lieu of a water meter deposit and to reassign said benefit units to District for cancellation. 8. Persons seeking water service who are not being served at the time of closing shall be permitted service connection at the discretion of Authority subject to ordinary and customary fees as may be applicable. 9. District agrees to furnish Authority at time of closing a list with current addresses of its customers. 10. Authority agrees to pay District at time of closing the total purchase price for the property described in Exhibit "A ", of Forty Nine Thousand Seven Hundred Fifty (S49,750.00) said purchase price to be paid in cash, subject to the following: (a) Delivery at time of closing of all necessary recordable documents executed by the District in favor of the Authority to convey all items referred to in Paragraph above. (b) List of customers as provided in Paragraph 9 above. (c) Release of lien on behalf of the Farmers Home Administration. (d) Provide the Authority with UCC search in Rogers and Oklahoma County and certification from the Secretary of State, all evidencing there are no liens or encumbrances filed against the subject property other that the Farmers Home Administration Mortgage. 11. Authority will assume all right, title and interest in said property conveyed and shall assume the duty to maintain and operate said system from 8:00 a.m. of date of closing and shall assume liability for the operation of said system as shall occur from that time and date. District acknowledges that it shall be liable for any claims or occurrences attributable to its operation of the system up to the time and date of closing and each party hereto agrees to hold the other party harmless from any liability, attorney's fees and expenses of any nature whatsoever arising from or related to any liability assumed herein. t12. The cost and performance of this Contract shall be as follows: Each party shall pay their respective attorney fees. Authority shall pay recording ' fees of the documents acquired from District No. 3, and any and all expenses incurred in obtaining financing for the purchase of any property. District No. 3 shall pay expense of deannexation and any expense incurred relative to The Farmers ' Home Administration loan. District No. 3 shall pay their expenses of material and labor to disconnect from the District lines within the deannexed area. Authority shall furnish such necessary material and labor to connect the deannexed area to its system. IN WITNESS WHEREOF, the parties hereunto have affixed their hands and seals of the signature to be attested by an appropriate officer of each party, the day and year first above written. RURAL WATER DISTRICT NO. 3 Rogers County, Oklahoma ATTEST: By: Chairman ' Secretary THE OWASSO PUBLIC WORKS ATTEST: AUTHORITY ' By: Chairman c s Authority Clerk APPROVED: Attorney for the Authority Attorney for RWD #3, Rogers County INVENTORY OF RWD #3 EQUIPMENT WITHIN POTENTIAL DEANNEXATION AREA: 2" PVC - - 6500' 2" valves - - 7 3" PVC - - 3900' 3" valves - - 3 4" PVC - - 8600' 4" valves - - 5 2 -way hydrants - - 5 meter sets - - 76 (retain 1700' of 4" PVC north of 145 E Ave /96 St N) MEMORANDUM TO: CHAIRWOMAN AND TRUSTEES ' OWASSO PUBLIC WORKS AUTHORITY IFROM: RODNEY J. RAY SUBJECT: PROPOSED PURCHASE OF SERVICE AREA FROM ROGERS RURAL WATER DISTRICT #3 LJ DATE: FEBRUARY 12, 1993 0. BACKGROUND: Over two years ago City staff members and Rogers County Rural Water District staff initiated discussions relating to a long -term philosophy regarding the future relationship between the two organizations. At that time it was reported to the Council that a viable option for addressing the long -term relationship would be for the City and District to agree to a concept that would allow 1 the City to acquire certain portions of the District as the City's growth moved into the District's service area. Additionally, it was reported that our staff team believed that eventually the City _ could serve water to the entire area west of the Verdigris River. It was believed that such a relationship would best serve the interest of the citizens and customers of both the City and the Water District. It was recognized that the first phase of such acquisition would, most likely, be in the area immediately north of the Owasso High School and east of 129th East Avenue. That area ' includes approximately one and one -half sections that is primarily undeveloped, and would be a logical acquisition because of its proximity to the existing City boundary. Subsequent to those discussions the majority of the section around the school was annexed by ' the City Council upon request from the property's owners. After annexed pieces of the area began to sell and development of those parcels was begun, each time a tract began to develop ' the developer and City of Owasso would petition the Water District to remove that tract from the District's service area so water could be supplied by the City along with other municipal services. Initially, the District was understanding and did, in fact, detach two areas so the City ' could provide service. At that time, however, there were concerns that the City seemed to want to "piece- meal" the undeveloped portions of that area into our service area leaving the District to serve their existing customers. That concern was heightened when the City later requested that additional property be released from the District for development within the City. At that c PROPOSED PURCHASE OF SERVICE AREA FEBRUARY 12, 1993 PAGE TWO point the District's Board adopted a policy that prohibited ' p Po y p ted the release of any other tracts until the City of Owasso would agree to take the entire one and one -half sections east of 129th E. Avenue north of 86th Street and west of 145th East Avenue. The District took that position, because it believed that to allow the City to have all of the area that would produce future revenue, while being forced to maintain the existing customers of that area, was a poor business decision. They did not want the responsibility of having to maintain their own lines along side City lines and have the maintenance cost associated with the upkeep of what would eventually become a kind of "no -mans area ". That feeling resulted in the District telling our staff that they felt an agreement should be finalized for the City to take over the entire area and include the purchase of their existing lines as a part of the "deal" criteria. After reviewing the District's proposal the City staff review team was of the opinion that the proposal for taking over water service for that area was premature and would result in a large capital liability for the City. Although the District's lines in the area under discussion are in good condition, it was the staff position that development in the area was not occurring, that land prices were too high to promote the sale and development of the area, and that absent development the City would be forced to do substantial capital investment to maintain service to the existing 66 customers. It was also the staff opinion that the existing customers would not provide enough revenue to offset the capital, operating and maintenance cost. Based on that evaluation the staff was not receptive to accepting a deal for a buy -out at that point. Subsequent to that opinion, several things happened that forced the staff to rethink its position. First, all of the undeveloped land in the section around the high school has sold to parties interested in development. Fox land to Windsor Lake Developer, Synar land to Terrill Taylor - Brentwood and Trayband property to Charlie Helscel. Second, housing developments will accomplish most of the capital cost needed to continue service to the existing customers. Lastly, the recent creation of an Enterprise Fund could certainly use the revenue generated by an additional thousand water taps during the next five to ten years. In reviewing the land available for development in the areas under discussion, it is the staff opinion that a conservative figure of 1600 new water customers could be used to calculate revenue /expense figures for analyzing this proposal. That number of customers will eventually generate $96,000 per year in contribution to the Enterprise Fund Capital Program alone. Additionally, that number of water customers will increase the OPWA bottom line by approximately 20% over our current level. When considering that capital costs are minimal (less than $5,000 to hook up to system) the financial impact of acquiring the area is significant. It is also anticipated that the acquisition fee of $49,750 can be recouped by adding a fifty dollar ($50) extra charge on the tap fee for all water taps in that area. Based on our data it is expected that the acquisition cost would be recouped in the following manner: PROPOSED PURCHASE OF SERVICE AREA FEBRUARY 12, 1993 PAGE THREE 1993 -94 $ 6,000 (120 lots) 1994 -95 5,000 (100 lots) 1995 -96 15,000 (300 lots) 1996 -97 17,500 (350 lots) 1997 -98 15,000 (300 lots) 1998 -99 11,500 (230 lots) 1999 -2000 10.000 200 lots Total surcharge $ 80,000 1,600 lots Thus a $50 per tap extra charge assessed to that one and one -half section will, over a seven year period produce enough revenue to pay the $49,750 acquisition cost plus add an additional $30,250 to the OPWA to offset any maintenance cost on the existing system as its mains are replaced by development. ACOUISITION COST: The proposal from the District requests payment (lump sum) of $49,750. That payment is in consideration for acquiring the following areas and lines. SECTION 21 TOWNSHIP 21N. RANGE 14E 1. 100 acres with 1400 feet of 2" pvc 2. 40 acres with 1500 feet of 4" pvc (Pleasant View) 3. 180 acres with undeveloped land SECTION 16 TOWNSHIP 21 N. RANGE 14E PROPOSED PURCHASE OF SERVICE AREA FEBRUARY 12, 1993 PAGE FOUR 1. 160 acres with 4,600 feet of 3" pvc 900 feet of 4" pvc 1,700 feet of 2" pvc 1,500 feet of 1 1/2" pvc 2. 60 acres with 5,600 feet of 4" pvc 3. 420 acres of undeveloped land Total acres developed - 360 Total number of customers now - 66 Total feet of 4" pvc - 8,000 Total feet of 3" pvc - 4,600 Total feet of 2" pvc - 3,100 Total feet of 1 1/2" pvc - 1,500 Total acres undeveloped - 600 Total projected taps when fully developed - 1,600 PROPOSED CONTRACT: The contract proposed by the District contains the following items: 1. Lump sum payment of $49,750 upon presentation of mortgage free deed 2. Transfer of ownership of all existing lines and easements to OPWA and engineering plans for all lines PROPOSED PURCHASE OF SERVICE AREA FEBRUARY 12, 1993 PAGE FIVE 3. Six months for City to assume service to existing customers of the District ' 4. Agreement to charge only in -City water rates to 66 existing District customers 5. Detachment of all of Section 21 and Section 16 from Rural Water District service area ' with lien releases from F. H. A. CONEMENTS: 1. The acquisition of this area will create a positive revenue source for the OPWA. The area ' is already developing and the only reason for the lack of additional development is the lack of desire to develop while this issue is unresolved. ' 2. Even though we can work out a deal with the District for them to provide water while the City provides sewer, refuse and other services, it is logical to have only one provider for all services. 3. Under the staff proposal, all acquisition costs would be returned to the City as taps were requested, thus no current citizen would be paying for the acquisition, additionally the extra tap fee would produce funds for any maintenance and operation needs of the existing system. 4. The existing lines serving the 66 customers will not provide adequate fire protection. While there is no law or requirement for that protection the Trustees should note that fire fighting capacity in the currently developed areas of section 16 and 21 will be limited until housing developmentS replaces all of the main lines. Even then the lines within the County subdivisions ' would not be replaced and would not support fire fighting equipment. 5. Mr. Cates has reviewed and commented on the proposed contract. All changes requested were approved by the District's Board. ' 6. While I do understand the natural reluctance of the Trustees to pay for what we consider sub- standard lines and then assume responsibility for those lines, I strongly believe that the City is the logical provider of services to that area and should move to acquire the rights to service the tproperty with a municipal water service. 1 PROPOSED PURCHASE OF SERVICE AREA FEBRUARY 12, 1993 PAGE SIX 1 RECOMMENDATION: I The staff recommends Trustee approval of the attached agreement and authorization for the Chairwoman to execute the necessary documents, and approval of an expenditure of $49,750 to the Rogers Rural Water District #3 as compensation for the service area. ATTACHMENTS: 1. Proposed contract 2. Map showing area under discussion r� 71