HomeMy WebLinkAbout5.490 Original Contract
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INTERGOVERNMENTAL WATER FACILITIES AGREEMENT
CITY OF PORT ANGELES
AND
PUBLIC UTILITY DISTRICT NO.1 OF CLALLAM COUNTY
This AGREEMENT is made and entered into this 'l.2rJ. day of F!-bru.o..r~ 1999, by and between the City
of Port Angeles (hereinafter called the City) and Public Utility District No. 1 of lallam County (hereinafter called the
District).
WHEREAS, the City and the District concur that the elimination and avoidance of duplicate water system
facilities would be in the best interests of their customers; and
WHEREAS, the laws of the State of Washington, specifically RCW 35A.14.900, contains language governing
agreements between utilities regarding service territories and acquisition of facilities;
NOW, THEREFORE, IT IS AGREED between the parties hereto as follows:
1. In order to move toward resolution of water delivery restrictions at the District's Gales Addition reservoir, a new intertie
has been installed in the City's low zone area and a metered delivery point established.
2. The new delivery point will be used to provide water to the northwest section of the District's Gales Addition system.
3. The City will purchase the District's water facilities as shown on the attached Exhibit A. The City agrees to a purchase
price in the amount of $31,250.42 which will be paid within 30 days after receipt of an invoice from the District. The
purchase price includes plant value, severance costs and net revenue as shown on Exhibit B.
4. The District has transferred, and the City has accepted, the customer services attached to and receiving service from the
water facilities shown on Exhibit A.
5. Both parties agree that this Agreement shall not establish precedent for any future transfers of customers and/or facilities.
6. The City agrees, upon completion of the transfer ofthe water facilities, to indemnify, defend, and hold harmless the
District and its officials, employees, and agents, from and against any and all claims for damages or any other relief due
to property damage, personal injury, or any other form of loss arising from accidents or injuries occurring after the date
ofthe transfer. The City agrees to accept facilities as is with no warranty as to condition or suitability for use by the City
except as otherwise provided in this AGREEMENT.
The District agrees, upon completion of the transfer of the water facilities, to indemnify, defend, and hold harmless the City
and its officials, employees, and agents, from and against any and all claims for damages or any other relief due to property
damage, personal injury, or any other form of loss arising from accidents or injuries occurring prior to the date of the
transfer or occurring as a result of defects.
7. Each party warrants that the undersigned representative has full and complete legal authority to sign for it and to commit
it to the performance of the agreements set forth herein.
IN WITNESS WHEREOF, the parties hereto have caused the AGREEMENT to be duly signed and executed in two
counterparts as of the day and year first above written.
CITY OF PORT ANGELES
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PUBLIC UTILITY DISTRICT
NO.1 OF CLALLAM COUNTY
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CITY Of' PORT ANGELES SCAlE
PUBUC WORKS
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EXHIBIT A
EXlDBIT B
DEFINITION OF PURCHASE TERMS
A. COST FOR PURCHASING PARTY TO SERVE - The estimated cost to install the necessary distribution facilities
to serve the customers to be transferred at purchasing party's current construction standards and conditions.
B. PLANT VALUE - Current replacement cost using existing unit costs for all system facilities adjusted by the salvage
factor and the cost factor as shown in the following formula:
Plant Value (V) =
Current replacement cost (R) x [1- [Age of Plant (A) x Depreciation Factor (D)]] x Cost Factor (C)
R = engineer's estimate/unit costs to construct facilities
A = the average age, in years, of the plant to be transferred
D = .025, which equates to a depreciated life of 40 years
C = a factor from the table below which adjusts current costs for the effects of inflation
Age (Years)
1-3
4-6
7-11
12-16
17-21
22-26
27-31
32+
Cost Factor
1.0
0.85
0.65
0.56
0.51
0.47
0.43
0.35
NOTE: Only PVC, Cast Iron and Ductile Iron pipe has value for purposes of determining plant value. All other
types of material shall be deemed to have no value.
Plant Value Calculation:
Item
6" A.C. pipe
2" PVC pipe
2" Steel pipe
6" tee
6" elbow
6" gate valve
2" gate valve
air vac assembly
fire hydrant
blow-off assembly
3/4" services
3/4" services
3/4" services
3/4" services
3/4" services
3/4" services
3/4" services
3/4" services
3/4" services
I" services
Age (A)
35
25
35
35
35
35
25
35
14
25
15
20
12
3
29
9
8
12
5
3
Cost New (R)
33,264
4,365
3,395
255
540
1,590
430
490
4,160
455
700
700
700
700
700
700
700
700
700
1,600
Value (V)
769.33
148.53
69.56
75.79
21.44
1,514.24
80.19
245.00
178.50
274.40
647.50
82.78
352.63
676.00
274.40
520.63
1,480.00
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1 " services
1-1/2" services
5
20
800
2,425
$60,669
595.00
618.38
$8,624.28
Total
For purposes of this Agreement, Plant Value is $8,624.28.
C. SEVERANCE COSTS - All costs associated with the transfer of customers including but not limited to removing
interconnecting piping, facilities, and meters and administrative costs.
For purposes of this Agreement, Severance Cost is $0.00.
D. NET REVENUE - Five years worth of net revenue from transferred customers as determined by the following
formula:
Net Revenue (R) =
5 x Customer Usage (U) x Water Rate (W) x Annual System Net Revenue Factor (F)
adjusted for present value using the most current 5 year Treasury note annual yield rate (Y)
U = Most recent twelve (12) months of usage
W = Water rate(s) of each customer in effect at the time of transfer
F = Operating revenue from most recent annual income statement less purchased water costs, less distribution
maintenance expenses, less general taxes all divided by operating revenue
Y = 4.63%
Net Revenue Calculation:
Account
12861-1
13244-9
13116-9
43995-0
13243-1
13242-3
13120-1
13122-7
13290-2
13121-9
13113-6
13115-1
13245-6
Totals
12 Month Revenue
193.58
281. 77
360.55
32.40
156.19
194.61
172.88
3,434.97
150.71
282.27
560.05
421.48
1,148.15
$7,389.61
R = (.0463, (7389.61 x .7), (7389.61 x .7), (7389.61 x .7), (7389.61 x .7), (7389.61 x .7)) = $22, 626.14
For purposes of this Agreement, Net Revenue is $22,626.14.