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Res 142-2003 11/4/2003RESOLUTION NO. IAa - o ��IW5 RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS APPROVING RENEWAL AND EXTENSION OF CONTRACT FOR OPERATION AND MAINTENANCE OF JOINTLY OWNED LAKE AND CANAL SYSTEMS BY THE CITY OF WICHITA FALLS AND WICHITA COUNTY WATER IMPROVEMENT DISTRICT NO. 2; FINDING AND DETERMINING THAT THE MEETING AT WHICH THIS RESOLUTION WAS PASSED WAS OPEN TO THE PUBLIC AS REQUIRED BY LAW. WHEREAS, the City of Wichita Falls has previously entered into an agreement with the Wichita County Water Improvement District No. 2 for operation and maintenance of Lake Kemp, the Diversion reservoir, main canals, laterals and other facilities used in connection therewith; and WHEREAS, the City of Wichita Falls and the Wichita County Water Improvement District No. 2 are willing to extend the terms and conditions of the contract dated October 1, 1998 for an additional three -year term commencing on September 30, 2003. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS, THAT: SECTION 1 . The renewal and extension of the contract for operation and maintenance of jointly owned lake and canal systems by the City of Wichita Falls and Wichita County Water Improvement District No. 2 is hereby approved. SECTION 2 . It is hereby officially found and determined that the meeting at which this resolution was passed was open to the public as required by law. PASSED AND APPROVED this the 4th day of November, 2003. ATTEST: City Clerk STATE OF TEXAS § COUNTY OF WICHITA § CONTRACT FOR OPERATION AND MAINTENANCE OF JOINTLY OWNED LAKE AND CANAL SYSTEMS BY CITY OF WICHITA FALLS AND WICHITA COUNT WATER IMPROVEMENT DISTRICT NO. 2 This agreement, made and entered into by and between the City of Wichita Falls, Texas, hereinafter called "City," and Wichita County Water Improvement District No. 2, hereinafter called "District," both being municipal and political corporations and subdivisions of the State of Texas, each acting herein by and through its respective officers hereunto duly authorized, WITNESSETH: WHEREAS, City and District, who are the joint owners of Lake Kemp, the Diversion Reservoir, main canals, laterals, and other facilities used in connection therewith, make and enter into this agreement for the maintenance and operation thereof for the mutual benefits to be derived therefrom by each of these contracting parties, and for the consideration hereinafter set out, the covenants and agreements to be paid, kept and performed, it is agreed by the parties as follows: 1. Notwithstanding anything herein contained, it is agreed that no construction or interpretation of any of the terms of this agreement shall be construed to alter, change or modify the ownership of the jointly owned facilities, including the ownership of or rights to the use of the waters in Lake Kemp and the Diversion Reservoir, but that such ownership shall remain the same as set out in a certain agreement made and entered into by and between Wichita County Water Improvement PAGE 3 OF 3 PAGES AGENDA ITEM NO. SA District No. 1 and Wichita County Water Improvement District No. 2 dated April 4, 1923. As established by that agreement, City owns an undivided 66.11% interest in said facilities, and District owns 33.89% interest. 2. As provided in the said contract dated April 4, 1923, District shall have the full use of sufficient water for the irrigation of lands in said District. City shall have the full use of sufficient water required by it for municipal purposes. City shall have and retain the right to the prior use of the water of said entire system to the extent of a supply of water sufficient for the uses of the City, not to exceed a reserve supply of 50,000 acre feet of stored water, so that if at any time the supply of water available to said system in the reservoirs should be used to the extent that only that amount of water is available or in storage, then same shall be reserved for the uses of said City. If the storage reservoir is at any time emptied, then all waters in the Division Reservoir shall be reserved for the use of the City. 3. Except as set out in the two paragraphs immediately preceding, this agreement is made and entered into in lieu of and instead of any and all contracts and agreements which may have heretofore been made and entered into by City and District or District and Wichita County Water Improvement District No. 1. 4. It is expressly not the intent of City and District to create, participate in, operate or maintain a joint enterprise by entering into this agreement. As a part of the consideration of this agreement, District shall have total and compete control of all maintenance, operational, design and improvement functions of the jointly owned facilities, to the complete exclusion of the City, regardless of ownership interests, PAGE 4 OF 4 PAGES AGENDA ITEM NO. 8A except as provided herein. It is agreed that District shall, when requested by City, release so much water as is required by City for its purposes. District shall have total and complete control over the hiring and firing of its employees, as well as the sole right of control over its employees, to the complete exclusion of City. District and City acknowledge the only commonality of purpose in the ownership of the jointly owned facilities is the furnishing of water, as required, from Lake Diversion to City and West Texas Utilities, with the transport, delivery and sale of irrigation water being the sole purpose and responsibility of District. City shall not participate in revenues from the sale of irrigation water. 5. The term of this agreement shall be for a period of three (3) years from October 1, 2003. 6. Further, as a part of the consideration for this agreement, City shall) pay to District $157,500.00 per year for each year of the contract, Such payments shall be made in monthly installments of $13,125.00 each; the first such monthly installment shall be paid on or before October 15, 2003, and a like monthly installment shall be paid on or before the 15` day of each month thereafter during the term of this agreement. 7. In addition to all other consideration herein agreed upon, City and District with the United States Army Corps of Engineers shall annually agree to and implement a maintenance and operation plan and proposed budget for Lake Kemp separately from the operation and maintenance activities and division of costs as covered by this PAGE 5 OF 5 PAGES AGENDA ITEM NO. 8A agreement. It is mutually agreed and understood that costs to implement the Lake Kemp operation and maintenance plan shall be borne as follows: Corps of Engineers shall bear 51.6% of the total cost, District shall bear 66.11% of the remaining local share of 48.4 %, and the City shall bear 33.89% of the remaining local share of 48.4 %. District shall invoice, with back -up material, City and Corps of Engineers monthly for the Lake Kemp operation and maintenance costs. 8. Any expense of unforeseen and emergency repairs to Lake Kernp, the Diversion Reservoir and the main canals occasioned by an act or acts of God, as that term is usually defined, in addition to all other consideration herein agreed upon, shall be borne by both parties in proportion to their joint ownership therein, that is, City shall bear 66.11 % and District shall bear 33.89 %. Such repairs shall be recommended solely by District and before the repairs provided for in this paragraph are made, they shall be approved by both City and District. 9. The proceeds of the sale of water shall be collected by District and shared equally by City and District, with the exclusion of proceeds from the sale of irrigation water for which District is exclusively entitled. The accounting and distribution of shared proceeds shall be made quarterly, providing that any water sales contracts shall be mutually agreed upon by District and City before the same shall be binding. 10. District shall, during the term of this agreement, keep its accounting records to conform to the fiscal year of City and such records shall be open for inspection by City at all times. Such records shall continue the chart of accounts as now used. There shall be made annually an outside audit by an auditor acceptable to both City and PAGE 6 OF 6 PAGES AGENDA ITEM NO. 8A District, and a copy of such audit shall be submitted to City within ninety (90) days after the close of District's fiscal year. 11. If either party hereto shall become dissatisfied with the terms of this agreement, excluding that part of this agreement contained in paragraph 1 hereof, then in such event, such dissatisfied party shall, only during the third year of the term of this agreement and on or prior to six months preceding the termination date, notify the other party in writing setting forth specifically its grounds therefore, immediately following which the parties shall attempt to renegotiate this contract by mutual agreement. If on or prior to four months of the expiration of the three year term the parties are unable to agree upon a renegotiation, or having failed or neglected to agree upon a renegotiation, the matter or point of disagreement shall be submitted to a Board of Arbitration in the manner provided by law, such Board consisting of the City Manager of City, the General Manager of District, and a third disinterested and unbiased person selected by a majority of the district judges of Wichita County, Texas. The decision or renegotiation of this contract by such Board shall be final and binding upon the parties hereto unless the substantive legal rights of either party are violated. 12. City and District jointly owning the facilities, anticipating their continued ownership perpetually in themselves, their successors or assigns, recognize their ownership responsibility one to the other, and by this and the immediately preceding paragraph, it is meant that this ownership responsibility shall not cease or fail but that during such joint ownership of such facilities there shall exist an operation agreement PAGE 7 OF 7 PAGES AGENDA ITEM NO. 8A between the parties hereto reached by mutual agreement or arbitration as the case may be. 13. The District has occupied office space in City -owned structures for many years. The City will, during the term of this agreement, authorize the District to occupy office space at 402 East Scott. There will be no charge to the District for such office space, but the District will in turn, and as consideration, not levy any taxes against the City for City -owned property within the District during the term of this agreement and for all previous years in which the District has occupied City -owned office space. The City, after reasonable notice to the District, shall be allowed to furnish comparable facilities mutually agreeable to both parties at a different location if City needs this space for other City purposes, or if City disposes of such property. Such comparable facilities shall be furnished under the same terms and conditions set forth above. IN WITNESS WHEREOF, the parties have caused this agreement to be executed by their duly authorized officers on this the day of , 2003. CITY OF WICHITA FALL, TEXAS 0 City Manager ATTEST: City Clerk PAGE 8 OF 8 PAGES AGENDA ITEM NO. 8A WICHITA COUNTY WATER IMPROVEMENT DISTRICT No. 2 ATTEST: Secretary, Board of Directors 0 President, Board of Directors PAGE 9 OF 9 PAGES AGENDA ITEM NO. 8A