Res 063-84 4/3/1984RESOLUTION NO. CG'j
RESOLUTION APPROVING WATER PURCHASE CONTRACT WITH
THE CITY OF HOLLIDAY.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA
FALLS, TEXAS , THAT:
That certain water purchase contract, a copy of which is
attached hereto, between the City of Wichita Falls and the City of
Holliday, which takes the place of that certain water purchase
contract between the two cities dated December 1, 1968 , as amended,
is hereby approved, and the City Manager is authorized to execute
the same for the City of Wichita Falls.
PASSED AND APPROVED this the third day of April, 1984 .
der("*.:;"°
9
M Y O R
ATTEST:
12 f'
City Clerk
WATER PURCHASE CONTRACT
THIS CONTRACT for the sale and purchase of treated water is
entered into the day of 1984, between
the City of Wichita Falls, Texas, hereinafter referred to as the
City", and the City of Holliday, Texas, hereinafter referred to
as "Holliday".
WITNESSETH:
WHEREAS, Holliday is a municipal corporation organized and
established under provisions of the laws of the State of Texas.
One of the duties of Holliday is the construction and operation
of a water supply distribution system serving water users within
the corporate limits of Holliday, and to accomplish this purpose,
Holliday will require a supply of treated water; and,
WHEREAS, the City owns water reservoirs and treatment and
transmission facilities with capacity capable of serving the
present customers of the City system and the estimated number of
current water users to be served by Holliday; and,
WHEREAS, Holliday operates a water distribution system, and
serves its customers; and,
March 29, 1984 Page 3 of 16 Pages
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Agenda Item No. 12.b.
WHEREAS, the City and Holliday entered into a water purchase
contract on December 1 , 1968, and subsequently agreed to one
modification to the contract, said modification amending Section
2.0 of the 1968 contract to increase the commodity rate for water
from $0. 145 per 100 cubic feet to $0. 18 per 100 cubic feet; and,
WHEREAS, both parties desire to set aside the 1968 Water
Purchase Contract with any and all amendments, and to enter a new
contract; and,
WHEREAS, as part of this agreement, both parties desire to
provide for future coordination and cooperation by ' agreeing to a
limit to which the city limits and the extraterritorial
jurisdiction of Holliday may be extended into- the
extraterritorial jurisdiction of City as it existed on September
3, 1969; and,
WHEREAS, by Resolution No enacted on the
day ofy 1984, the City Council of City authorized
City to continue selling treated water to Holliday under the
terms of this new, mutually agreed Water Purchase Contract; and,
WHEREAS, by Resolution No. enacted on the day
of 1984, the City Council of Holliday
authorized the continued purchase of treated water by Holliday
under the terms of this new, mutually agreed contract.
NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, THAT for
March 29, 1984
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Page 4 of 16 Pages
Agenda Item No. 12.b.
value received, • City and Holliday mutually agree to the
following, to wit:
Section 1_0_ City shall deliver treated water to the
established delivery point for sale to Holliday in sufficient
quantities to meet Holliday's needs and Holliday shall be
permitted to take same for resale to consumers, subject only to
the terms and provisions of this contract.
Section 1 . 1 : Water delivered to the delivery point shall be
of the same quality the City furnishes to residents of City and
at a pressure the City attempts to maintain in the operation of
its transmission and distribution facilities and at the points of
delivery to its own users.
Section 1_2: Delivery point shall be located at the
termination of the City's 10" water main on the Southeast side of
the Seymour Highway approximately 750 feetlinside the city limits
of City.
Section 1_3_ Holliday shall have the responsibility to
transport the water from the delivery point to its consumers,
including imparting additional pressure to adequately serve
Holliday's consumers. Holliday shall provide at its own expense
necessary transmission and storage from and at the delivery point
to prevent abnormal demands by Holliday, which demands would
reduce the residual static pressure below 20 PSI in the City's
mains at the delivery point. If a mechanical facility is
March 29, 1984 3_
Page 5 of 16 Pages
Agenda Item No. 12.b.
f
required to abate the abnormal demands, Holliday will install a
pressure regulating valve and will not allow the residual
pressure to be lowered to less 20 PSI without permission of City.
Section 1 .4: Holliday shall furnish, install , operate and
maintain at its own expense at the delivery point, the necessary
metering equipment, including a meter house or pit, and required
devices of standard type for properly measuring and recording the
quantity of water taken by Holliday. City and Holliday shall
agree on the type of any replacement meter before purchase by
Holliday. Metering equipment shall be calibrated by Holliday
whenever requested by City, but not more frequently than once
every twelve (12) months, and furnish certification of such
calibration to the Director, Public Utilities. A meter
registering not more than two per cent (2%) above or below the
rated capacity of the meter shall be deemed to be accurate. The
previous readings of any meter disclosed by test to be inaccurate
shall be corrected for the twelve (12) months previous to such
test in accordance with the percentage of inaccuracy found by
such tests and existing records. If any .meter fails to register
for any period, the amount of water furnished during such period
shall be deemed to be the amount of water pumped in the
corresponding period immediately prior to the failure, based on
existing records unless City and Holliday shall agree upon a
different amount.
Section _0_ The cost of water purchased by Holliday
shall be based on the following rate setting principles:
March 29, 1984
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Page 6 of 16 Pages
Agenda Item No. 12.b.
a. Revenue requirements to be determined on utility basis at
an agreed test year's Original Cost adjusted 307. toward current
cost to cover its costs and as compensation for ownership.
adjustedb. City to receive a Rate of Return on the agreed ad Y g
value Rate Base equal to a composite of the utility's test year
embedded cost of money weighted on the debt portion of capital
invested in plant in service and the utility's latest cost of
money weighted on the remaining equity portion of plant in
service to cover its risks.
c. All existing reservoirs and associated facilities to be
included in common rate base. Outside customers as a class
either raw water, treated water only and transmitted treated
water) will pay their proportionate share of all costs based on
current use.
d. A flat rate (volume only) , shall be charged, with
allocation of 100% current use to encourage conservation and
thereby resulting in efficient utilization of the water system.
e. The risk of financing all future raw water transmission
lines and reservoirs must be borne by the City Water Utility, and
all costs will be allocated on current use basis.
Changes in the rate setting principles may be made by mutual
March 29, 1984
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Agenda Item No. 12.b.
agreement at any time.
Section 2. 1 : The cost of water purchased by Holliday
shall be based initially on the following schedule:
a. Starting on the first day of the first complete monthly
billing cycle after the date this contract is entered into, the
rate shall be $0.34 per 100 cubic feet, said rate to continue for
6 full monthly billing cycles;
b. Starting on the first day of the seventh complete
monthly billing cycle after the date this contract is entered
into, the rate shall be $0.41 per 100 cubic feet, said rate to
continue for 6 full monthly billing cycles;
c. Starting on the first day of the thirteenth complete
monthly billing cycle after the date this contract is entered
into, the rate shall be $0.48 per 100 cubic feet, said rate to
continue for 6 full monthly billing cycles;
d. Starting on the first day of the nineteenth complete
monthly billing cycle after the date this contract is entered
into, the rate shall be the current rate then being paid by other
contract water users of the City who pay the "treated transmitted
water" rate. At the time this contract was entered into, that
treated transmitted water" rate was $0.5202 per 100 cubic feet,
however City and Holliday acknowledge it may be higher by the
March 29, 1984
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Page 8 of 16 Pages
Agenda Item No. 12.b.
start of the nineteenth billing cycle discussed in this
paragraph.
Section 2.2: After the increase in paragraph d of Section
2. 1 , the rates to Holliday shall be subject to change each year
as a result of a cost-of-service study using the rate principles
in Section 2.0; provided however, that the first rate change
resulting from a cost-of-service study cannot occur less than 12
months after the increase in paragraph d of Section 2. 1 . When a
cost-of-service study is conducted, City will provide the results
and the new rates to Holliday. The new rates will then be billed
on the first billing date occurring not less than 60 days after
Holliday receives such rates.
Section 2.3: City will read the Holliday meter on the
first normal work day of each month during the term of this
contract. Holliday and City shall have free access to read
meters daily if they so desire. City will provide Holliday, no
later than the 10th day of each month, with an itemized statement
showing the amount of water metered to Holliday during the
preceding month and the resulting charges. Holliday shall pay to
City the amount of the itemized statement no later than the 20th
day of the month in which the charges are billed.
Section 3.0: This contract shall extend for a term
of 40 years from the date the contract is entered into. At the
expiration of the term of this contract, same may be renewed or
extended for such term or terms, as may be agreed upon by City
March 29, 1984
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Page 9 of 16 Pages
Agenda Item No. 12.b.
and Holliday. City may cancel this contract at any time during
the life of the contract in the event Holliday fails to make any
payment due hereunder within 60 days after same becomes due; or,
if Holliday breaches any covenant herein other than payment of
the monthly statement, and such breach continues for 60 days
after City gives Holliday written notice thereof.
Section 4.0: Holliday shall not be required to
furnish water to any resident of City. If the City extends its
city limits to include any consumer of water from Holliday.
Holliday will continue to provide water to such consumer until
City is able to extend its own water distribution systems to
provide such consumer with water.
Section 5.0_ Holliday shall permit water to be used
only for normal residential , commercial and municipal purposes
within its city limits and extraterritorial jurisdiction. Unless
written permission is obtained from City, water shall not be used
for agricultural irrigation; by any processing or manufacturing
concern which uses such water in substantial quantities; for other
municipalities; or for residential or commercial subdivisions
outside the Holliday city limits on the transmission main.
After the date of this contract, unless written permission is
obtained from City, Holliday shall not sell water to any consumer
outside of the boundaries of the extraterritorial ' jurisdiction of
Holliday, other than those consumers being served on the date of
this contract. Holliday shall not sell any water to any private
party for resale by such private parties to third parties.
March 29, 1984
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Page 10 of 16 Pages
Agenda Item No. 12.b.
Section ItIt is agreed that, du ' ng the term =f this
contract, neither the city li ' is nor th- Extr. territorial
Jurisdiction (ETJ) of Hol ' - -y shall e:tendei urthe into the territory
contained in City's E . as i existed on Septemb-r 3, 969, than
that portion t. -reof which was apportioned to Holliday 'n the
agreement sated September 3, 196-, between City and Holliday
copy - tached) .
Section 5.2: Holliday shall ration water to its consumers
if City rations water to its residents. Rationing of Holliday
consumers shall be on the same basis as the rationing of
residents of City.
Section 6_01 This contract is subject to such rules,
regulations, or laws, as may be applicable to similar agreements
in the State of Texas; City and Holliday will collaborate in
obtaining such permits, certificates, or the like, as may be
required to comply herewith. Where a direct physical connection
exists between the water supply distribution systems of City and
Holliday, Holliday shall operate and maintain its portion of the
water supply distribution system in accordance with the standards
of the Texas Department of Health and in compliance with Article
4477-1 Vernon's Annotated Civil Statute and in compliance with
those provisions of Section 12 of the Plumbing Code of Wichita
Falls, entitled Water Sueply and Distribution,which was in effect
as of April 1968.
Section 6. 1 : City shall have the authority and
March 29, 1984
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Page 11 of 16 Pages
Agenda Item No. 12.b.
responsibility of inspection to determine that no cross
connections or conditions of backflow or back-siphonage exist on
that portion of the system receiving water under pressure from
the Wichita Falls water mains. City shall have the authority to
disconnect the water until correction within the system is made.
City shall also have the right to suspend delivery of water in
the event Holliday fails to construct, maintain and operate its
portion of the water distribution system in substantial
compliance with such standards referred to hereinabove.
Provided, however, unless substantial non-compliance constitutes
a safety and/or health hazard, City shall not suspend the
delivery of water without first notifying Holliday in writing of
such non-compliance and affording Holliday a reasonable
opportunity to correct such non-compliance. Provided, further,
in no event shall City suspend delivery of water to any portion
of Holliday's system not necessary in isolating the location of
such non-compliance.
Section 7.0: Any amendment to this contract shall be in
writing and executed by both City and Holliday.
Section 8.0_ This contract sets aside and takes the place
of the previous Water Purchase Contract between City and
Holliday, dated December 1 , 1968, with a first amendment. City
agrees that the rate agreed in the first amendment, and effective
October 1 , 1975, was the last agreed rate modification, and that
as of the date of this new contract, Holliday has no arrears
March 29, 1984
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Page 12 of 16 Pages
Agenda Item No. 12.b.
accumulated in its monthly payments to City.
Section 9_0_ In the event of any occurrence rendering
Holliday incapable of performing under this contract, any
successor of Holliday, whether the result of legal process,
assignment, or otherwise, shall succeed to the rights of Holliday
hereunder.
IN WITNESS WHEREOF, the parties hereto, acting under
authority of their respective governing bodies, have caused this
contract to be duly executed in three counterparts each of which
shall constitute an original .
ATTEST: CITY OF WICHITA LLS, TEXAS
BY: l---d17
CITY CLERK AYO-
ATTEST: CITY OF HOLLIDAY, TEXAS
BY:
CITY SECRETARY MAYOR
March 29, 1984
Pages
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Page 13 of 16 Pag g
Agenda Item No. 12.b.
Section 5 .1. It is agreed that, during the term of this
contract, neither the city limits nor the Extraterritorial
Jurisdiction (ETJ) of Holliday shall be extended/into the
territory contained in City' s ETJ as it existed on September 3 ,
1969, than that portion thereof which was apportioned to Holliday
in the agreement dated September 3 , 1969 , between City and
Holliday (copy attached) . It is understood that the territory
annexed by Holliday by Ordinance No. 67-2 extends beyond this
limit, but such annexation shall remain in force, and the city
limits as established by such ordinance shall not be affected by
this provision.
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