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HomeMy WebLinkAbout7/20/2005 - STAFF REPORTS (26) O�paLM SAR u OgAEEO 9 aw c9`'FOVL City Council Staff Report DATE: July 20, 2005 Consent Calendar SUBJECT: Sewer Services Agreement FROM: David H. Ready, City Manager BY: City Manager's Office SUMMARY The Desert Water Agency (DWA) is legally authorized to provide sewer services within its service area and has requested that the City consider entering into an agreement that will enable them to provide sewer services to specific developments outside the City's limits. Under the proposed Sewer Services Agreement, DWA would be responsible for the design, construction and maintenance of the sewage collection system that would be needed to provide sewer services to these developments. DWA would agree to deliver the collected waste to the City's Wastewater Treatment Plant for treatment. The secondary effluent would then be made available to the DWA for tertiary treatment, reclamation and use in lieu of potable water to irrigate turf and landscaping. RECOMMENDATION: t. Adopt Minute Order No. Authorizing the City Attorney to Finalize an Agreement with Desert Water Agency to Provide Sewer Services for Specific Developments Outside the City's Jurisdictional Boundaries but within the Desert Water Agency's Service Area. 2. Authorize the City Manager to Execute the Agreement. STAFF ANALYSIS: Recently, staff was informed that the City of Cathedral City had made a formal request to the Desert Water Agency (DWA) to provide sewer services to approximately 511 single-family homes and an elementary school in the Dream Homes Area. In addition, a private developer has also asked DWA to provide sewer services to an estimated 200 single-family homes that have been proposed off of Highway 111 near Overture Drive. City Council Staff Report July 20, 2005 -- Page 2 Partial Suspension of Sewer Facility Fee Section 15.24.030 of the City's Municipal Code allows sewer services to be extended to properties outside and adjacent to the City limits. Historically, properties outside the City limits have been required to pay twice the established sewer connection and service rates that are assessed on properties located within the City. According to the DWA, neither the City of Cathedral City nor the private developer seem willing to pay the higher sewer connection and service fees and may look for an alternative solution, including delivering their waste to the Coachella Valley Water District, if the City does not provide some relief on the fees. On June 15, 2005, the City Council approved a Resolution enabling the City to enter into agreements or contracts with other governmental agencies for the purpose of providing sewer services to properties outside or adjacent to the City when in the determination of the City Council such services would be in the public's best interest. Under such an agreement, the City Council could agree to waive all or a portion of the higher fee that is assessed on properties outside the City limits. DWA is legally authorized to provide sewer services within its service area, and currently provides sewer collection services to a portion of Cathedral City through a cooperative agreement with the Coachella Valley Water District (CVWD). Under this agreement, all waste collected by the DWA is delivered to CVWD for re-use as reclaimed water within CVWD's service area. DWA is interested in providing sewer services to the areas noted above, but would prefer to have the collected waste delivered to the City for treatment instead of CVWD. If the waste is delivered to the City, the secondary effluent could be made available to the DWA for re-use as reclaimed water within the City. Currently, the DWA provides reclaimed water services to a number of customers located within the City, including privately owned golf courses, Palm Springs High School, and the City for irrigation of Demuth Park and the City's municipal golf course. The use of reclaimed water in lieu of potable water to irrigate golf courses, parks, turf and landscaping is extremely important and furthers the water conservation objectives of both the City and DWA. In light of this, staff believes that an agreement with DWA to provide sewer services to the Dream Homes and Palm Oasis areas is in the public's best interest in that it will provide additional reclaimed water resources that will benefit the property owners and customers of both the City and DWA. DWA has conducted a wastewater flow study for both the Dream Homes and Palm Oasis areas. According to the study, both areas will produce average flows of less than 600,000 gallons per day and combined peak flows of less than 1,000,000 gallons per day. The City's Wastewater Treatment Plant is permitted at 10.9 million gallons per day. Current wastewater flows are estimated at 7 million gallons per day. Based on this information, there appears to be sufficient capacity to handle the additional wastewater from these areas. City Council Staff Report July 20, 2005--Page 3 Partial Suspension of Sewer Facility Fee Under the proposed Sewer Services Agreement, DWA will design, construct and maintain the collection system that will be needed to serve the two areas. For its part, the City will impose its standard connection and sewer service fees that are assessed on properties within the City. DWA will collect from each developer and/or property owner the standard sewer connection charge and remit those funds to the City. In addition, the DWA will be responsible for billing and collecting the monthly sewer service fee from all properties served under this agreement and remitting those funds to the City. DWA will deliver the collected sewage to the City's trunk sewer system for transportation to the City's Wastewater Treatment Plant for proper treatment and disposal. Once the sewage has been treated, the secondary effluent will be made available to the DWA for processing by its reclamation plant for tertiary treatment. Since the DWA will be able to sell the reclaimed water in lieu of potable water to irrigate golf courses, turf and landscaping, they have agreed to pay the City a one-time payment of$200,000 for its share of the value of the sewage that will be collected under this agreement. Staff believes that this agreement represents a "win-win" situation for all parties and is recommending its approval. FISCAL IMPACT: If the City Council approves this agreement, the City will receive approximately $1,712,000 in connection fees and an additional $88,391 a year in sewer service fees. This is half of what the City would normally receive for providing sewer services to properties outside of the City. fI Troyal . Butzlaff,� s i tant City Manager David H. Ready, City onager Attachments: V ,I 1. Minute Order MINUTE ORDER NO. AUTHORIZING THE CITY ATTORNEY TO FINALIZE AN AGREEMENT WITH DESERT WATER AGENCY TO PROVIDE SEWER SERVICES FOR SPECIFIC DEVELOPMENTS OUTSIDE THE CITY'S JURISDICTIONAL BOUNDARIES BUT WITHIN THE DESERT WATER AGENCY'S SERVICE AREA. --------------- I HEREBY CERTIFY that this Minute Order, authorizing the City Attorney to Finalize an Agreement with Desert Water Agency to Provide Sewer Services for Specific Developments Outside the City's Jurisdictional Boundaries, but within the Desert Water Agency's Service Area, was adopted bey the City Council of the City of Palm Springs, California, in a meeting thereof held on the 20` day of July, 2005. James Thompson City Clerk SEWER SERVICE AGREEMENT FOR AREAS OUTSIDE CITY LIMITS (DREAM HOMES AND DESERT OASIS PROJECTS) This Agreement is effective as of the day of July, 2005, between the Desert Water Agency (hereinafter called "Desert") and the City of Palm Springs (hereinafter called "City"). RECITALS A. Desert provides retail water service to customers located within Desert's boundaries, including all of the citizens and businesses located within the City. Desert also provides reclaimed water service to a number of customers located within the City, including (among others) privately owned golf courses, Palm Springs High School, and the City itself for irrigation of Demuth Park and the City's municipal golf course. B. The City provides wastewater service to all of the citizens and businesses located within the boundaries of the City, and also to some customers located outside of the City. The City's wastewater treatment plant produces secondary effluent which is delivered to Desert's reclamation plant located adjacent to the City's wastewater treatment plant, for tertiary treatment, reclamation and use in lieu of potable water to irrigate turf and landscaping. The use of reclaimed water in lieu of potable water to irrigate golf courses, parks, turf and landscaping furthers the water conservation objectives of both the City and Desert, and benefits the citizens, customers and property owners of both the City and Desert. C. Desert is legally authorized to provide sewer service within its boundaries, and currently provides sewer collection services to a portion of the City of Cathedral City. Pursuant to agreement between Desert and the Coachella Valley Water District("CVWD"), the waste collected by Desert in Cathedral City is delivered to CVWD for treatment in CVWD's wastewater treatment plant, and is then reclaimed by CVWD for re-use as reclaimed water within CVWD's service area. D. The City of Cathedral City has asked Desert to also provide sewer services for development proposed within the area identified on Exhibit"A" attached hereto and incorporated herein (the "Dream Homes Area"), which is also located within Desert's boundaries. In addition, Desert has been asked to provide sewer services for development proposed in the area identified on Exhibit "B" attached hereto and incorporated herein (the "Palm Oasis Area"). Although Desert's agreement with CVWD would allow Desert to collect waste within the Dream Homes Area and the Palm Oasis Area and then deliver the waste to CVWD for treatment, reclamation and re-use within CVWD's service area, Desert and City would prefer to deliver the collected waste to the City for treatment, with the secondary effluent then RVPUB\MTR\695370.1 Draft Document available for reclamation by Desert at its reclamation plant located within the City's boundaries. Thus, the reclaimed water would be retained for re-use within the City and Desert, and would not be lost to CVWD for its use within its service area. E. The use of reclaimed water in lieu of potable water to irrigate golf courses, parks, turf, and landscaping in the City is extremely important and furthers the water conservation objectives of both the City and DWA. This Agreement is in furtherance of such policy goals and is in the public's best interest in it provides an opportunity for the City to receive additional reclaim water resources for the benefit of property owners and customers of both the City and DWA. F. Desert has conducted feasibility studies which demonstrate that the waste to be generated by the proposed development in the Dream Homes Area and the Palm Oasis Area will produce average flows of less than 600,000 gallons per day and combined peak flows of less than 1 ,000,000 gallons per day. The City has capacity currently available in its wastewater treatment plant to accommodate the delivery and treatment of these additional flows. G. Desert proposes to assume responsibility for ownership, operation, maintenance, and repair of the sewage collection facilities necessary to provide sewer service within the Dream Homes Area and the Palm Oasis Area; to deliver the waste thus collected into the City's existing trunk line facilities for transportation to and treatment at the City's wastewater treatment plant; to pay the City's wastewater treatment sewer fund the same amounts that the City would receive in the form of capacity charges and service charges for the provision of such service to sewer service customers within its own boundaries; and to share the value of the reclaimed water retained for the general benefit of Desert and the City by paying to the City the lump sum of $200,000 for the general benefit of the City's citizens, residents, and property owners. The City has agreed to Desert's proposal, upon the terms hereinafter set forth. AGREEMENT Based upon the foregoing facts, and in consideration of the mutual covenants of the parties, it is hereby agreed as follows: 1 . Construction of In-Tract and Off-Site Facilities. The City agrees to accept into its wastewater system and treat waste collected by Desert within the Dream Homes Area and the Palm Oasis Area, at a maximum rate of flow not to exceed 1 ,000,000 gallons per day. Desert shall adopt, maintain, and enforce standard specifications for the construction of sewer facilities, and rules and regulations for the control of waste, which shall be as comprehensive and stringent as those established by the City and in effect within the City's boundaries. Desert will require each developer of property within the Dream Homes Area and the Palm RVPU&A4 R\695370.1 -2- Oasis Area to construct in-tract sewage collection facilities required to serve such property, and also whatever off-site facilities may be necessary to transport the waste therefrom to the City's trunk sewer at locations mutually acceptable to the City and Desert. The cost of all connections and any additional work or improvements reasonably determined By City to be necessary to accommodate the delivery and treatment of flows from the Dream Homes and Palm Oasis Areas shall be borne by Desert. All in-tract and off-site facilities outside of the corporate limits of the City such facilities, shall be designed and constructed in accordance with Desert's specifications, and its ordinances, rules, and regulations. Plans and specifications for such work shall be subject to approval by Desert and City and construction of all facilities shall be subject to inspection by Desert and City. Desert shall require the developer of any such property to pay the prevailing charges to Desert and the City, respectively, for any such plan checking and inspection services. Desert's rules and regulations shall require the developer to notify and obtain the City's approval before any connection into the City's trunk line sewer is made. 2. Bond Requirements. The developer of any property shall provide such bonds or other security as Desert or the City may require in order to assure construction of required sewer facilities. Until such security has been provided, or the facilities have been accepted by Desert and the City, neither party shall be required to give assurances to any governmental agencies that sewer service will be provided to the property. 3. Transfer of Title to Facilities. Upon satisfactory completion of the construction work required under Paragraph 7, as determined by the parties hereto, the developer shall convey to Desert the title to all in-tract and off-site facilities constructed by the developer outside the City's corporate limits and to the City all facilities constructed by the developer within the corporate limits of the City. Title shall be free and clear of all mechanic's liens, or other liens or encumbrances of any kind, and the developer shall provide such evidence of clear title as may be required by the parties. The developer shall also obtain and/or convey appropriate rights of_. way for such facilities. All instruments of conveyance shall be in the form approved by Desert or the City as the case may be. 4. Capacity Charge. Desert shall collect from each developer whose property is provided with sewer service under the terms of this Agreement the standard sewer capacity charge established by the City in the City's Fee Resolution, as may be amended from time to time, for connections within the City and in effect at the time application for service is made, and shall transmit such funds to the City. 5. Sewer Service. Upon acceptance of the required sewer facilities, and subject to payment of rates and charges and compliance with all conditions of this Agreement, Desert and the City shall provide sewer service to those developments which have been connected to the City's wastewater system. Desert shall operate RVPUB\MTR\695370.1 -3- and maintain all sewer facilities outside the City's corporate limits constructed under this Agreement. Once sewage has been delivered into the City's trunk sewer system, the City shall provide for the transportation, treatment, and disposal of such sewage. Upon 90 days written notice to the City, Desert shall have the right to take over the full responsibility of providing sewer service, including treatment and disposal of the sewage, to any development served under this Agreement, and thereafter the City shall have no further obligations under this Agreement. Desert shall be responsible for all costs associated with Desert's assumption of such responsibility, including any costs for modifications to any portion of the Desert's or the City's sewer facilities. 6. Customer Charges. Desert shall be responsible for billing and collecting all rates and charges for sewer service furnished to any developments served under this Agreement, and for transmitting to the City its share of such funds as provided herein. A monthly charge for services provided by Desert and the City under this Agreement shall be made for each dwelling unit or equivalent dwelling unit connected to the sewer system. The City's portion of such charge shall consist of its standard charge for sewer service provided within the City's boundaries as established by the City in its Fee Resolution as it may be amended from time to time. The City shall give Desert 60 days advance notice of any change in its service charges. In addition to such charges for City services, the total monthly charge to customers served under this Agreement shall include whatever sum may be determined by Desert to be necessary to cover its costs for operating and maintaining the facilities, and for billing, collecting and administering the terms of this Agreement. Desert shall take all reasonable measures to collect any delinquent accounts, and shall have the right to discontinue service pursuant to its rules and regulations, and all provisions of law, in case of any delinquency. However, Desert shall be required to pay to the City its charges for service, irrespective of whether such amounts are collected from the customers. This obligation shall be subject to any court determination affecting the validity of the City's charges. The term "dwelling unit" as used in this Agreement-shall mean a single family residence as_ such term is defined and/or understood pursuant to the City's Fee Resolution as amended from time to time. 7. Sharing of Value of Reclaimed Water. Desert shall share the value of reclaimed water resources preserved for the general benefit of the citizens, residents, and property owners of both the City and Desert, as a result of this Agreement, by making a one-time payment of $200,000 to the City within 30 days after execution of this Agreement. Desert acknowledges that the City may execute this Agreement only after its City Council has adopted an appropriate resolution or minute order authorizing such execution. It is understood that City Council approval of such resolution or minute order shall be deemed approval of the provision of service upon the terms, rates, and charges set forth herein, pursuant to Section 15.24.030 of the City's Municipal Code. RVPUB\MTR\695370.1 -4- EXECUTED by the duly authorized officers of the parties hereto, and effective upon the date entered. ATTEST: DESERT WATER AGENCY By: Secretary President of the Board of Directors ATTEST: CITY OF PALM SPRINGS By: City Clerk Mayor RVPU13\MTR\695370.1 -5- 3 ADD, CAUENIE Qv SCHDDL I ILL UY0 R MON ROAD PM ON ROAD GENE Mlflh'iPAIL SAN LUIS Rfl CROSSLEV ROAD EXHIBIT "A" DWG.BY DATE: SCALE CATHEDRAL CITY ses Dams N.T.S. DREAM HOME AREA DESERTIWATER SHEET DESERT WATER AGENCY 1 OF 1 PALM SPRINGS, CALIFORNIA C:\tivq\DnnmNanM sr °r e hr Gh, 9A F hG �l r 3 Q� yy� � �w {fie 7� 3 qw v 'hhll�lll' EXHIBIT "B" DWG. BY DATE: SCALE SES 06M N.T.S. PALM OASIS AREA DESERT WATER SHEET DESERT WATER AGENCY 1 OF 1 PALM SPRINGS, CALIFORNIA