Title
Intergovernmental Agreement with City of Tolleson to Divert, Treat and Transport Salt River Valley Water Users' Association Entitlement Water and Provide Emergency Backup Water (Ordinance S-46980)
Description
Request to authorize the City Manager, or his designee, to enter into an Intergovernmental Agreement (IGA) between the City of Phoenix (Phoenix) and the City of Tolleson (Tolleson), replacing Agreement 125121, to divert, treat and transport Tolleson's Salt River Valley Water Users' Association (Association) entitlement water allocation, and further providing for emergency backup water service. There is no financial impact associated with this IGA.
Report
Summary
Tolleson has requested, and Phoenix has agreed to: 1) divert, treat and transport Tolleson's Association entitlement water allocation; and 2) supply water to Tolleson in the event of emergency conditions where entitlement water is not available.
Entitlement Water
All entitlement water delivered by Phoenix to Tolleson under this IGA will be charged to Tolleson's entitlement water accounts pursuant to the Tolleson Water Delivery and Use Agreement with the Association.
Tolleson will pay any and all assessments, fees or other charges that the Association may require as a condition of receiving and using Tolleson's entitlement water. Phoenix's obligation to divert, treat and transport Tolleson's entitlement water will be limited to, and will not exceed, the amount of entitlement water that Tolleson has the right to receive pursuant to the Water Delivery and Use Agreement between the Association and Tolleson. If Tolleson's use exceeds its entitlement amount in any calendar year, Tolleson will pay the prevailing water and environmental rates for customers outside of Phoenix for the monthly amount of water used in excess of Tolleson's entitlement amount.
Phoenix agrees to divert, treat and transport Tolleson's entitlement water at a wholesale water delivery rate, based upon a cost of service study. The wholesale water rate will be based on the actual capital, operating and maintenance costs for diverting, treating and transporting Tolleson's entitlement water to Tolleson. The wholesale water rate will be effective for a two-year period and will be reviewed every two years for the term of the agreement. The wholesale water rate may also be adjusted when there are significant increases or decreases, as justified by a cost of service study.
Emergency Backup Water
The IGA will include provisions allowing Tolleson to request and Phoenix to supply water to Tolleson in the event of emergency conditions where the supply of entitlement water is not available. In that situation, Tolleson may request a temporary supply of emergency backup water from Phoenix for a period of up to 60 days. Tolleson will pay Phoenix for the emergency backup water at the prevailing water rate set forth in Section 37-64 of the Phoenix City Code and water environmental rate set forth in Section 37-133 of the Phoenix City Code applicable to water customers located outside of Phoenix, as adjusted for conversion of the rates from cubic feet to gallons.
Contract Term
The initial term of this IGA will be for 10 years, with an option for Tolleson to renew for an additional 10 years.
Financial Impact
There is no financial impact associated with this IGA.
Concurrence/Previous Council Action
The City Council approved:
- IGA 75437 for Providing Water Services to the City of Tolleson on June 19, 1996; and
- IGA 125121 for Treating and Delivering Tolleson's Entitlement Water on Sept. 17, 2008.
Department
Responsible Department
This item is submitted by Deputy City Manager Karen Peters and the Water Services Department.