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28-Move to approve a resolutionCITY COUNCIL AGENDA ITEM BRIEFING SHEET Submittal Date: Originating Department: Presented By: Agenda Item No.: 06/16/09 Shawn Napier, P.E. City Engineer Council Date: Engineering /Director of Public Works 28. 06/22/09 RECOMMENDED MOTION: Move to approve a resolution to amend a memorandum of understanding with the City of Irving to extend the exclusive negotiation period 12 months and authorizing the City Manager to negotiate and execute all necessary documents. POLICY ISSUE(S): Intergovernmental cooperation; Water resource management BACKGROUND: The City of Paris entered into a memorandum of understanding with the City of Irving on January 14tn, 2008 to exclusively negotiate with the City of Irving for the possible sale of water from Pat Mayse Lake, in exchange for $40,000 and an additional $160,000 for reimbursement for research on the feasibility of selling water. This MOU expires December 31, 2008. Council appointed the Lake Pat Mayse Study Committee to determine if there is enough water to sale their first meeting was March 27. The committee has used HDR Consulting Engineers, water attorney Jim Mathews, and rate consultant Darrell Cline to assist in technical areas. The Committee is not expected to have a final report and recommendation ready until sometime around July 2009. Because of the lead time required to get an item on the ballot for citizens to vote on (if the Committee even determines that there is water available for sale and the Council wants to consider a sale to Irving or someone else), there may not be enough time to have a water sale proposition on the November ballot and as a result the next election date would be in May 2010. Consequently, staff recommends extending the MOU 12 months. If the MOU is not extended at all, the balance of the unexpended $160,000 from Irving would no longer be available to complete the Committee's work and the City would have to pay for the remaining work out of reserves. On December 8, 2008, City Council extended the term of the Memorandum of Understanding between Paris and Irving until June 30, 2009. The Committee has not completed their study and will need additional time to complete their work and present their final report to the Paris City Council, probably by the first meeting in August. BOARD/COMMISSION RECOMMENDATION: N/A EXHIBITS: Memorandum of Understanding with the City of Irving ACTION: BUDGET INFO: ❑ Financial Report ❑ Minute Order Expense $ 0.00 ❑ Department Report Z Resolution Budgeted Amt. $ 160,000.00 ❑ Presentation ❑ Ordinance y'I'D Actual $ 193,796.66 ❑ Public Hearing ❑ Other Acct. Name Consultants - Pat Mayse Acct. Number 10-0319-81-00 FISCAL NOTES: REVIEWED AND APPROVED BY: Z Administration Z City Clerk ❑ Communiry Development ❑ EMS/IT Z Finance ❑ Fire ❑ Munici al Court Z Le al ❑ Libra ❑ Police Z En ./Public Works ❑ Utilities City of Paris t Revised 2/04/08 _ ~~l~i!G.` 9 DRAFT attorney\reswork\current\MOU - City of Irving Sale of Raw Water Extension Res 2009 RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS, AUTHORIZING THE EXTENSION OF A MEMORANDUM OF UNDERSTANDING DATED JANUARY 14, 2008 BETWEEN THE CITY OF PARIS, TEXAS A1VD THE CITY OF IRVING, TEXAS PERTAINING TO THE FEASIBILITY STUDY AND POSSIBLE SALE AND TRANSPORTATION OF RAW WATER FROM LAKE PAT MAYSE A1VD/OR LAKE CROOKTO THE CITY OF IRVING; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. WHEREAS, on January 14, 2008 the City of Paris entered into a memorandum of understanding with the City of Irving to study the feasibility of selling excess water from Lake Pat Mayse to the City of Irving; and, WHEREAS, in February 2008, the City Council of the city of Paris created a Lake Pat Mayse Study Committee made up of eleven (11) voting members from the City of Paris and additional ex-officio members from Lamar County that had expertise or special interest in the City's water resources; and, WHEREAS, the City Council asked the Study Committee to determine how much water was available at Lake Pat Mayse, whether that quantity could be increased or additional water sources developed, and the amount of raw water needed in the future to meet the City's needs and the needs of its water customers. The committee first met on March 27, 2008, and has consulted with HDR Engineering, water attorney Jim Mathews and rate consultant Darrell Cline to assist in the technical areas; and, WHEREAS, on December 8, 2008 the City Council by Resolution No. 2008-106 approved extending the term of the Memorandum of Understanding between Paris and Irving until June 30, 2009 to allow the Lake Pat Mayse Study Committee more time to complete their work and present their final report to the Paris City Council; and, WHEREAS, the Lake Pat Mayse Study Committee has not completed their study and will need more time to complete their final report and recommendations to Council; and, WHEREAS, the City Council will need time to study the report and recommendations from the Study Committee and to hold additional meetings and/or public hearings to educate the public on those report findings and to solicit input from the public; and, WHEREAS, it is deemed appropriate and in the best interest of the City of Paris and its citizens to extend the term of the Memorandum of Understanding between Paris and Irving until June 30, 2010, to allow the Lake Pat Mayse Study Committee to complete their work and present their final report to the Paris City Council, and should in all things be approved. ~ 01t?C2~' ~ NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUIVCIL OF THE CITY OF PARIS, TEXAS: Section 1. That the findings set out in the preamble of this resolution are hereby in all things approved. Section 2. That the term of the Memorandum of Understanding dated January 14, 2008 between the City of Irving, Texas and the City of Paris, Texas as set forth in Exhibit A attached hereto, be, and the same is hereby extended for an additional twelve months, to June 30, 2010. Section 3. That the City Manager of the City of Paris, be, and he is hereby authorized and directed to execute on behalf of the City of Paris any and all documents necessary to extend the term of the Memorandum of Understanding with the City of Irving as provided herein. Section 4. That this resolution shall be effective from and after the date of passage. PASSED AND ADOPTED this 22nd day of June, 2009. Jesse James Freelen, Mayor ATTEST: Janice Ellis, City Clerk APPROVED AS TO FORM: W. Kent McIlyar, City Attorney ~ L0C2(1 MEMORANDUM OF UNDERSTANDING TO EXCLUSIVELY NEGOTIATE The City of Irving, Texas ("Irving") and the City of Paris, Texas ("Paris") Qointly referred to as the "Parties") enter into this Memorandum of Understanding (°MOU") on the 14t1of Ianuary 200f g (the "Effective Date") to express their agreement to enter exclusive ~*-'T'r, negotiations for Paris to sell water from Lake Pat Mayse to Irving and to assist Irving as follows: acquiring rights-of-way; seeking approval of required permitting for inter-basin transfer and, possibly the development of new sources; and providing for the storage and conveyance of water from sources outside Lake Pat Mayse (the "ProjecY'). This is an interlocal agreement, entered pursuant to Chapter 791, Texas Government Code that sets out the Parties' agreement to undertake negotiation of a water suppiy agreement (the "Agreement") pursuant to the terms set forth below. This memorandum of understanding does not obligate either party to enter such an Agreement in the event that the Parties are unable to agree upon the terms of the Agreement. . This MOU sets forth the general concepts the parties desire to make part of the Agreement. Neither party has agreed to all aspects of the issues outlined below relating to the Agreement. However, Irving and Paris each agree that they are conducting these discussions in good faith with the expectation that an Agreement will be reached. The parties understand that all representations and commitments of Irving and Paris relating to the Agreement require formal approval of their respective City Councils. BACKGROUND January 14, 2008, By formal action of the City Council of Paris on Seeermbef 4'9~, and by resolution number ia•t3 m•u99 adopted by the City Council of Irving on December 13, 2007, Paris and Irving have confirmed their commitment to negotiate an Agreement for the Project as outlined in this MOU, have,been authorized to enter into this MOU, and have instructed their respective City staffs to continue negotiations with a goal of bringing the Project to a successful conclusion. But acknowledging that there is no guarantee by either party that an Agreement will be reacMed. SUMMARY OF TERMS AND CONDITIONS 1. Irving will be responsible for the following: a. Payment to Paris of $40,000 for entering this exclusive negotiation. Payment to be received by Paris within ten (10) days of executing this Memorandum of Understanding. b. Reimbursing Paris for all engineering, feasibility, financial, legal, legislative or public relations consulting expenses incurred by Paris and related to this proposal or the sale, transfer or transportation of water from Lake Pat Mayse in an amount not to exceed One Hundred and Sixty Thousand And No/100 Dollars ($160,000). Irving agrees to reimburse Paris for all such expenses within thirty (30) days of receipt of statement from Paris. Irving further agrees to furnish a written explanation as to any disputed expenses within ten (10) business days of receiving the statement from Paris. The rarties agree to work together to resolve any disputed expenses, and if this fails, the parties agree to submit to mediation to resolve said dispute. The mediation must take place within sixty (60) days of the date Irving disputes said expenses and mediation MOU Between Irving and Paris 1 EXHIBI'T' -L ~ 0 0 6 Z2~w, shall take place in the City of Paris. The parties shall mutually agree on a mediator, and irving shall pay for all expenses of the mediation, including the mediator's fee. c. Conducting required engineering studies related to pipeline and water availability and feasibility. Irving agrees to timely share with Paris, and or Paris' engineers, attorneys and/or consultants, ail information, studies and reports received by Irving related to this proposal or the sale, storage, transfer or transportation of water into or from Lake Pate Mayse provided, however, Inring shail not be required to share any information, reports or studies related to Irving's determination of the value or pricing of water from Lake Pat Mayse or sold through Lake Pat Mayse. d. Providing analysis of required perrnitting and licensing. e. Maintaining communications and negotiations as confidential, as mutualiy agreed upon by the Parties and to the extent authorized by law, until the water supply agreement is executed or at such time that Paris and Irving rnutually agree to terminate this Memorandum of Understanding. Nothing herein shall be interpreted to violate or override the requirements of the Texas Open Meetings Act or Texas Public Information Act. 2. Paris will be responsible for the following: a. Participating in this exclusive negotiation. b. Agreeing not to negotiate with any other party, other than current water customers of Paris or new industrial customers desiring to locate a plant or factory in the city limits of Paris, Texas, regarding sale of a water supply from Pat Mayse Reservoir until after December 31, 2008, or prior to such date if mutually agreed upon by the Parties. c. Cooperating fully in the analysis and evaluation of the feasibility of the Project and timely sharing with Irving, and or Irving's' engineers, attorneys and/or consultants, all information, studies and reports received by Paris related to this proposal or the sale, storage, transfer or transportation of water into or from Lake Pat Mayse; provided, however, Paris shall not be required to share any information, reports or studies related to Paris' - determination of the value or pricing of water from Lake Pat Mayse or sold through Lake Pat Mayse. d. Maintain communications and negotiations as confidential, as mutually agreed upon by the Parties and to the extent authorized by law, until the water supply agreement is executed or at such time that Paris and Irving mutually agree to terminate this Memorandum of Understanding. Nothing herein shall be interpreted to violate or override the requirements of the Texas Open Meetings Act or Texas Public Inforrnation Act. 3. The Parties will work diligently toward studying the feasibility of the Project and negotiating a proposed contract outlining specific terms of the Agreement and bringing forward said contract for review to the Irving and Paris City Councils no later than December 31, 2008, unless such date is extended by mutual agreement of the parties. These terms will include: a. Quantity of water available over the terrn of the agreement and agreement extensions. b. Payment terrns, incfuding minimum and maximurn payments, for water from Lake Pat Mayse. c. Payment terms for water conveyed through Lake Pat Mayse. MOU Between Irving and Paris 2 (t0 (:2~'.` 'J~ d. Drought conservation plan coordination. e. Address future water demands in Paris. f. Minimum lake levels in Lake Pat Mayse. g. Potential new water sources and return flows. h. Estabiish performance milestones. Paragraph 3 is not intended to be contractual in nature, but oniy expresses the basis upon which the Parties wish to enter into an Agreement. The undersigned acknowledge that paragraph 3 is intended to outline initial terms for consideration only and is in no manner intended to obligate any party contractually and no such obligation shall arise unless and until the Agreement has been fully executed by, and delivered to, all parties, in which event, the terms and conditions of the fully executed Agreement shali constitute the complete and final Agreement with respect to water supply purchases. In witness whereof the parties have executed this Mernorandum of Understanding effective on the date and the year first written above. PARIS: THE CIT1( OF PXRIS, By: n Ca(ruthXity Manager APPROVED AS TO FORM: By: W. Kent ty r, C y Attorney IRVING: THE CITY OF IRVING, TEXA By: V4~'~ a. - ert A. Gears, Ma yor APPROVED AS TO FORM: By: ZL Charles R. Anderso , City Attorney i ' , „n~'~~ iT J MOU Between Irving and Paris 3 . Li 0 l~ 2 "t ~f