Title
Request to Enter into a Development Agreement with a Developer to Provide Funds to Own, Operate and Maintain Two Force Mains (Ordinance S-50722)
Description
Request authorization for the City Manager, or his designee, to enter into a Development Agreement with M Brothers 67th Avenue, LLC, to allow the Developer to provide funds in exchange of having the City own, operate and maintain two small diameter force mains in Phoenix. Further request to authorize the City Controller to accept and distribute the necessary funds related to this item.
Report
Summary
M Brothers 67th Avenue, LLC (referred to herein as the "Developer"), is planning to develop a property at the northeast corner of 67th Avenue and Pinnacle Peak Road in Phoenix (referred to herein as the "Development"). Due to the site topographic constraint, the Development could not gravity flow sewer into the City's collection system. The Development does not generate enough wastewater flow to warrant a public lift station and force mains. Therefore the Development was allowed to design and construct a private lift station with a one and half inch private force main to convey wastewater to the City's sewer main north of the Development along 67th Avenue. However, 67th Avenue is in the City of Peoria's Right-of-Way (ROW) and they do not allow private utilities located inside their ROW.
The Developer filed a technical appeal asking the City to allow this small diameter force main to be public while the lift station remains private. Because this property is in the City's service area and neither a gravity public sewer nor a private force main option to the City's sewer system is technically feasible, the technical appeal was approved with stipulations including entering into a Development Agreement with the City to cover all future operational and maintenance costs with the force mains incurred by the City in perpetuity.
According to the Development Agreement, the Developer, at its own expense, will design, permit and construct two, one and a half inch force mains in accordance with the City's public force main standards. After the City accepts the force mains, the City will own, operate and maintain the two force mains. The City will invoice the Developer on all future maintenance costs (defined as the collective costs of all maintenance, repair or replacement, including labor costs associated with the two force mains). The Developer must make full payment within 30 days of receipt of the invoice or submit a notification of dispute according to the development agreement. The City may add liens to the property for any unpaid or unsettled maintenance costs.
Contract Term
The contract term will be for perpetuity.
Financial Impact
The City will take two small diameter force mains for operation and maintenance. Since the maintenance costs of those two force mains will be reimbursed by the Developer or its Successors-in-Interest, there will be no financial impact to the City.
Location
Council District 1
Department
Responsible Department
This item is submitted by Deputy City Manager Ginger Spencer and the Water Services Department.