HomeMy WebLinkAbout35. 17-621 DECEMBER 12, 2017 17-621 RESOLUTION
(CARRIED 7-0 LOST LAID OVER WITHDRAWN )
PURPOSE: APPROVE RENEWAL OF AGREEMENT WITH TOWN OF
ALGOMA SANITARY DISTRICT NO. 1
INITIATED BY: DEPARTMENT OF PUBLIC WORKS
WHEREAS, the City of Oshkosh and the Town of Algoma Sanitary District No. 1 a
parties to an Agreement in Principal providing for the treatment of sewage generated from
both entities expiring on December 31, 2017; and
WHEREAS,it is advisable to enter into a one (1)year extension of this Agreement to
allow the parties sufficient time to review the existing agreement prior to entering into a
long term extension of the Agreement.
BE IT RESOLVED by the Common Council of the City of Oshkosh that the proper
City officials are hereby authorized to enter into and take those steps necessary to enter into
a one (1) year renewal of the professional services agreement with Town of Algoma
Sanitary District No. 1.
city�of
Oshkosh
MEMORANDUM
TO: Honorable Mayor and Members of theCo Council
FROM: James Rabe, Director of Public Works
DATE: December 7, 2017
RE: Approve Renewal of Agreement with Town of Algoma Sanitary District No. 1
BACKGROUND
In June 1973, the City of Oshkosh and the Town of Algoma Sanitary District No. 1 (District)
entered into an Agreement in Principal providing for the treatment of sewage generated from
both entities. That agreement was renewed until December 1977, when the City of Oshkosh and
the District entered into an agreement (1977 Agreement) regarding the treatment of sanitary
sewerage generated from the District. The 1977 Agreement replaced the previous Agreement in
Principal. The 1977 Agreement had an initial term of thirty (30) years. In 2007, the agreement
was extended for ten (10) years.
The District has requested another ten (10) year extension of the 1977 Agreement, through 2027.
ANALYSIS
The Department of Public Works has reviewed this request with the City Attorney's Office and
the Finance Department. During those review discussions, we believe that a shorter extension is
the best course of action to pursue at this time. Since this agreement is now forty (40) years old,
we believe a more thorough review of the terms and conditions, as well as the financial
responsibilities associated with the 1977 Agreement, are necessary. The regulatory climate is
currently very different than forty (40) years ago, and we feel it is important to ensure the terms
of our agreements are consistent with current regulatory requirements, and are able to adapt to
the changing regulatory world we are experiencing.
Over the course of the next four to five years, all of the agreements the City of Oshkosh has with
the adjacent township sanitary districts will expiring, or seeking extensions. This provides an
excellent time for us to revisit all of these agreements, and ensure the terms and conditions are
still applicable.
FISCAL IMPACT
The 1977 Agreement provides formulas for calculating the charges from the City of Oshkosh to
the District. Extending the 1977 Agreement will continue to utilize those formulas for charging
the District.
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RECOMMENDATIONS
I recommend extending the 1977 Agreement with the District for one (1) year, allowing staff time
to more thoroughly evaluate the terms and conditions of the 1977 Agreement.
Approved,
Mark A. Rohloff
City Manager
JER/tlt
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AGREEMENT BETWEEN THE CITY OF OSHKOSH AND
THE TOWN OF ALGOMA SANITARY DISTRICT $1
THIS AGREEMENT, made and executed this day of i.
1977, by and between the City of Oshkosh, a municipal corporation,
herein known as "City", located in the City of Oshkosh, 147innebago
County, Wisconsin, and the Town of Algoma Sanitary District #1, herein
"known as "District", a town sanitary district located in the Town of
.Algoma, Winnebago.County, Wisconsin,
WITNESSETH THAT:
WHEREAS; each of the parties hereto, being a municipal cor-
poration, has a responsibility of, providing an orderly, efficient
and sanitary means of collecting, treating and disposing of the
sewage of the residents .of such corporation, and
WHEREAS, the parties have heretofore entered into an Agreement
An Principal dated June 27, 1973, as renewed from time to time,
providing for a joint effort for the collection, treatment and
disposition of the sewage of the residents of.such corporations, and
WHEREAS, said Agreement in Principal was entered into for the
reasons that final engineering.plans and specifications for collection
and treatment facilities were'not completed at the time of the joining
of the agreement in principal, acid
i+If3EREAS, City has now completed the construction and financing
of a.sewage treatment plant not in existence at the time of the
execution of said Agreement in Principal, and
WHEREAS, District is now prepared to proceed with the construction
of a sanitary sewer collection system, the treatment of which sewage
shall be processed by City,
NOW, THEREFORE, in fulfillment of said Agreement in Principal
and in consideration of premises and of the conditions and covenants
hereinafter set forth, the parties hereby agree as follows:
1. That this Agreement replaces the Agreement in Principal
by and between the parties dated June 27, 1973 as extended from time
to time.
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2. That City and District shall collect, treat, and dispose
of their sanitary sewage on a joint basis, upon terms and conditions
as set forth in this Agreement_
3. That City shall and District shall not install,
operate and maintain facilities for the treatment of sanitary
sewage. District shall contribute money for such facilities of
the City, upon terms and conditions as set forth in this -Agreement.
4. City shall install, operate and maintain a.sanitary
sewage interceptor system adequate to convey the sanitary sewage
of District, .as described in.this Agreement. District shall
contribute money for the installation, operation and maintenance
of said interceptor system, upon terms and conditions as set
forth in this.Agreement.
5. 'District may from time to time install, operate and
maintain systems for collection of sanitary sewage within the
District as it may from time to time be constituted_ Sanitary
sewage so collected from District shall be transmitted
_by District
to.the interceptor system of City at certain collection points .to
be determined by the parties. Said collection systems shall be
installed, operated and maintained by.District and City shall
have no obligation in regard thereto.
6. .District may from time to time install, operate and
maintain interceptor sewer systems for the purpose of transmitting
sanitary sewage from its collection system to the interceptor
system of City. Such interceptor sewer systems shall be installed,.
operated and maintained by District and City shall have no obli-
gation in regard thereto.
7. As part of said collection system, District shall
install, operate and maintain metering devices approved by City
to meter all sanitary sewage emanating from District.
B. Except as may be provided otherwise by express
agreement, the costs of installation, operation and maintenance
of jointly used facilities shall be apportioned between the
parties as set forth.in this Agreement. The parties shall -adopt a
uniform system of accounts for the sewerage systems substantially
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in accordance with the Wisconsin Public Service Commission System
For Municipally Owned Water Utilities (Classes A and B)_
9. The sanitary sewage treatment plant of City, herein
known as "Plant", shall be deemed to consist of the present
facility located on Campbell Creek in the City of Oshkosh. For
the purposes of this Agreement, all sewage which passes through
Plant, whether treated or not, shall be deemed sanitary sewage_
10. The Plant and interceptor sewers as they presently
exist serve the City of Oshkosh. The parties intend that Plant
and interceptors will continue to serve the City as from time to.
time itis constituted, and that they will also serve the District
as it may be from time to time constituted. I.t is understood and
agreed that the design capacity of Plant allocable -to Districts
use thereof is 2,080,000 gallons per. day (g.p.dj which is -10.4%
of -the total design capacity of Plant. District shall have no
right to exceed 2,080,000 g.p-d_ -for its Purposes. except 'with -the
express written agreement of City. The parties also anticipate
that Plant may serve additional areas not included within the
corporate limits of City or District as those limits are from
time to time defined. Service rendered by City to others not
parties to this Agreement shall, for the purposes of this -Agreement,
be considered to be services of the City for its own. benefit.
11. Operation and maintenance costs of Plant and
interceptor sewers as they presently exist shall be defined for
the purposes of this Agreement to include the following: direct
and general maintenance expense, allocable general municipality
administration expense, and depreciation of capital investment_
Said expenses shall be apportioned between the _parties as provided
in this Agreement. District shall pay to City its pro -rata share
of operation and maintenance cost, to be computed as follows:
A. Demand Cost:
Cost of liquids and solids handling .for treatment plat
+ Maintenance of treatment plant
+ Laboratory cost done at treatment plant
+ Annual audit cost
+ Office rental cost
+ Professional services of outside consultants
Depreciation from above areas
x 15%
X. 2.55
= District demand cost re operation and maintenance expe
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B. Flow Cost:
Cost of liquids and solids handling for treatment plan
+ Maintenance of treatment plant
+ Laboratory cost done at treatment plant
+ Annual audit cost.
+ Office rental cost
+ Professional services of outside consultants
Depreciation from above areas
x 85%
X District's actual gallonage flow through plant
Total .gallonage flow throu h plant
District's flow related cost of operation and maintena
C. Depreciation:
Annual depreciation taken
x 2.5%
District's share of annual depreciation
District's annual cost for operation and maintenance therefore
would-be the sum of. the amounts computed pursuant to -the formulas
set forth in A, B,. and C of this paragraph. .Using,.the.year 1976
as an example,.such costs shall be computed as follows:
A'. Demand Cost:
Treatment plant $834'401.17-
+ Maintenance .$126,934.91
+ Solids $157,269.14
+ Laboratory $23,378.72'
Total $1,141,983.94
Depreciation $348,964.45
Net $793,019:49
x 15$
_ . Result $1181952..92
x
.2.5%
$2,973.82
B.
Flow Cost:
Treatment plant
. $834,401.17
+
.1-4aintenance
$126,934.91
+
Solids
$157,269.14
+
Laboratory
$23,378.72
=
Total
$1,141,983.94 .
-
De reciation
$348,964.45
_
Net
793,019.49
x
85%
=
Result
$674,066.57
x
.0147%*
=
Total
$9,908.78
C. Depreciation $348,964.45
x
To2.5$
= tal $8,724.11
Total cost to District for 1976 had
contract then been in operation $21,606.71
(*This computation assumes a flow from the sanitary
district of 45 million gallons which, when added to the City's
actual flow of 3,016.85 million gallons assumes a total flow with
District connected of 3,061.85 million gallons which would be
divided into the District's.estimated flow of 45 million gallons
to arrive at the 1-_47% factor.)
The parties -further agree that when District's
actual use of Plant, based on average gallon flowage as metered,
for the latest,quarter, exceeds 500,000 g.p.d., that the factors—
to-be applied to the 15§ of demand related cost shall be increased
to 5% per year -and the District's share of depreciation shall
also be increased to.5% per year. This increase and all future
,increases shall be retroactive to the. date of execution of this
Agreement. when the Districts actual average gallon flowage for
the latest quarter. exceeds 1,000,000 g.p.d. the factors. for .
depreciation"and demand costs shall be increase to When
•District,s actual average gallon flowage for the_]atest quarter
exceeds 1,500,000 g_p_d., the factors. for depreciation and demand
costs shall increase to 10.4%.
13_ District shall pay to City, in cash, at or before
Oe time of connecting District's co'
llection• system to City's
interceptor system, District's allocable share 'of the capital
cost of Plant and existing interceptors of City, the stun of
$374,970.97,r.in full satisfaction of District's obligation to
City .for capital costs of Plant and -interceptors as -they presently
exist.
14_ -The parties anticipate that from time to timeas
the -territories actually served by their respective "sanitary -
sewerage collection -systems expand toward each other''
there may -
The areas in their respective territories which Will be served
more economically or practically by the collection system or.
interceptor system of the other party. Agreements relating to
intersystem services for such territories shall be.agreed upon by.
the. parties upon terms and conditions equitable to the Parties -at
the time of initiation of such intersystem. services_.
15. City and District may .contract ,for such service
and maintenance on -sanitary sewerage collection facilities owned
by District upon whatever basis may be agreeable to both pantie$:.
serviceor maintenance contracts shall be independent of this
Agreement, -except that'the amounts,paid b
Y any party to any other
party -shall be accounted for in the computation of Operation and
maintenance expenses and general municipality administrative
as cl fzrzrl ir, this
Aq z-ee,�zt, 30 that no double charges
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may be made therefore.
16. District agrees to make every effort and to take
every action which may be within its authority to ensure that
storm waters and surface drainage will not enter into any sanitary
sewer line of its system. City also agrees that, to the extent
it installs and operates collection facilities which utilize the
collection systems or interceptors of the town sanitary districts,
it will make similar efforts and take similar actions to ensure
against collection of such waters and drainage. The parties also
agree to make reasonable provisions to control the collection of,
wastes which produce excessive loads due to any unusually,concentrated
.presence of deleterious waste matters. To the extent that such
wastes are collected by any party it is anticipated that the cost
of.collection.and treatment of sewage will'be increased accordingly.
The engineers of the parties involved shall calculate.the.resulting
cost increase from agreed upon contribution coefficients and.the
sum so computed shall be assessed annually against the party
collecting such wastes.
17. Each party agrees that to• theextent the installation,
repair or maintenance of.its sanitary sewerage facilities require
or.necessitate construction work to be done in the road right-of-
way or other property-of any other.party or municipality it will
repair or cause to be repaired such roads or streets or property
in accordance with the 'standards of such other.party or municipality
then in effect for the property so affected. To the extent it is
necessary for the'City to do any of'the.work contemplated in this
paragraph, the Sanitary District will secure any and all permits in
the Town of Algoma...
.18. The parties agree that no party shall be responsible
or liable to the other party for any loss caused by any breakdown
or failure of facilities affected by this Agreement not due to
the negligence or wilful neglect of the responsible party and
that each shall make no charge to the other for its. separate
facilities except as set forth in this Agreement..
19. Each party shall keep accurate books,'records and
accounts of every cost, expense, expenditure or disbursement
which may be made orentered by such party and which may or will
effect the performance of this Agreement. .Upon reasonable notice,
any party or its -agent shall be entitled to examine and inspect
the books, records and accounts of any other. party for the purpose
of verifying charges or credits paid or made pursuant to or in
performance of this Agreement.
21. Operation and maintenance expenses as contemplated
by.this. Agreement essentially represent annual expenditures, or
expenditures which may be amortized or otherwise placed on an
annual or periodic basis. These costs shall be computed on
annual or other periodic bases and apportioned among. the parties
in the manner provided by this Agreement. Payment shall be due,
or. offsetting credits may .be made, on a quarterly basis, commencing
on.the .first day of the months of January, April; July or October,
whichever may be applicable initially, and quarterly arotind'the
first day -of those months thereafter.
A. For purposes of establishing applicable rates,.
expenses shall be estimated until such time as actual. expenses are
determined. The first quarterly billing following'the determination
of actual yearly expenses shall include an adjustment of the previous
billings for that year.
B. Upon.any recomputation of any cost, or appor-
tionment thereof required or requested of'either party, notice in
writing shall'be given to all parties affected. The quarterly
payment which may be due next following such recomputation shall
be adjusted to reflect any adjustment necessitated by .such recoin-
putation. All payments of quarterly billing shall bepaid.
within sixty in full
(60) days of receipt thereof, provided, that the parties
may agree, to. alternative terms with respect to any adjustment, .the
payment of which within sixty (60) days would constitute an
unreasonable financial hardship; provided further, that the parties
shall agree upon a reasonable period of time following the occur-
rence of any event which gives any party the right to request such
adjustment, upon the expiration of which. such right shall terminate.
22. New capital investment may required in the
future for treatment of sewage emanating from District's collection
system. With reference to such new capital investment by city,
the engineers -charged with responsibility for design of such new
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investment shall calculate the proportion thereof which is intended
to service sewage emanating -from the various areas to be serviced
by said investment.' District's proportionate share shall be then
calculated and District shall pay to City its allocable share of
such investment either in cash or pursuant to whatever terms may
be agreed upon between the parties.
23. All disputes which cannot be resolved .by the parties
relating to the application or interpretation of any of the
Provisions of this Agreement shall be submitted for binding
arbitration under the usual rules and procedures of the American
Arbitration Association and any award thereunder may be entered
as a'Judgment in any court having jurisdiction.
24. This contract shall have.a term -of thirty (30)
years commencing with an effective date which is even herewith_
Said term'shall.be renewable upon ten (10) year extensions and
shall be terminable upon mutual consent of the parties at least.
one (I) year prior'to the expiration of the term or of any
extended term hereof_
IN WITNESS WHEREOF, we have hereunto set our hands and
seals on the day and year first written above.
wiess
Jw----�-- _
CITY OF OSHA SH
By:
William D. Frueh, City Manager
Converse C. Mark�,City Clerk
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witness
witness
Taitness
APPROVED,AS TO FORM:
v , City Attorney
TOWN OF ALGOMA SANITARY DISTRICT #1
By: y
Co ssion
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By: 7C�� .C�-�j�iL✓
Commission(
By: fl-GEiacr ////Yyi�crYca�
. Commission(
CURTIS, Ma/CXEEN-ZIE,.HAASE & BROWN, S..C.
By:_.
Robert A. Haase
Attorney for the Town of
Algoma Sanitary District #1