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Water and Sewer Subcommittee <br />April 22, 2003 <br />Page 11 <br /> <br />Sometimes they might have to add staff to accomplish the mandates. She said <br />they would try to stay ahead of those regulations and let the city know what is <br />coming down the pipe and what the affect would be. <br /> <br />Councilwoman Neeley questioned the length of the contract and if they had a <br />standard that they go by. Ms. Ross advised that it does vary and sometimes it <br />varies from state to state depending on state regulations. She said in the past <br />most of their contracts were for five years; but more and more of the contracts <br />are 10 years up to 20 years. Ms. Ross said that long term contracts enable the <br />cities to save more money. If there are capital investments that need to be made, <br />it allows the cities to amortize the investments over a longer contract period. <br /> <br />Chairman Plata asked whether, assuming on an average if the City of Paris <br />would contract with them for five years, after that five years, does it really spike <br />up or how does it generally average out, because people are scared of <br />privatization. Ms. Ross advised that what they do is provide the city with an <br />annual flat fee cost and in their contract they stipulate what situations would <br />make that cost increase each year. They would like to get an increase each year <br />like any business does for CPI. Also, other things that could cause it to increase <br />would be the water treatment plant's flow increase, or the amount of water <br />produced that city has to increase. Those items and chemical and energy <br />consumption would be considered when they would come to the city at the end <br />of the year with documentation showing how that effected those direct costs and <br />negotiate that increase with the city. The way the price is increased will be <br />clearly stipulated in the contract such as increase in services, cost of living <br />increase, and any additional services that the city wanted them to take on that <br />they were not previously providing. <br /> <br />Councilwoman Neeley asked about their compliance record and whether it varies <br />from city to city. Ms. Ross advised that they take great pride in their <br />compliance record because that is the business they are in. They cannot be <br />violating their permits and getting citations from regulators. They have a whole <br />infrastructure within the company that makes sure that they keep their clients in <br /> <br /> <br />