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RES NO 02-03-1983 2- 3- )G\ CITY OF VAN BUREN, ARKANSAS RESOLUTION NO. :3. 2 -1983 A RESOLUTION AUTHORIZING THE MAYOR TO EXECUTE AN AGREEMENT WITH FORT SMITH FOR A WATER SUPPLY ON LEE CREEK'. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF VAN BUREN, ARKANSAS: THAT,' The Mayor is hereby authorized to execute an agreement (a copy which is attached) with Fort Smith which provides for a cooperative arrangement in the construction of a water supply on Lee Creek. PASSED AND APPROVED THIS 21st DAY OF February 19 83 i r 6 41 MA WR ATTEST: CI Y CLERK- T•EASURER AGREEMENT This Agreement made and entered into this 25th day of February 1983, by and between the City of Fort Smith, Arkansas, a municipal corporation of the State of Arkansas, herein- after referred to as "Fort Smith and the City of Van Buren, Arkansas, a municipal corporation of the State of Arkansas, and the Van Buren Water and Sewer Commission, a Commission created by the City of Van Buren for the purpose of supervising the water and sewer operations of the City of Van Buren, hereinafter collectively referred to as "Van Buren W I T N E S S E T H: WHEREAS, the parties are interested in a cooperative effort whereby Fort Smith will acquire, own, construct and operate a dam impoundment and water reservoir for water supply purposes with the impoundment located at or near Mile 3.2 on the Lower Lee Creek in Section 3, Township 9 North, Range 32 West in County of Crawford of the State of Arkansas, and, WHEREAS, the parties desire to set forth the cooperation arrangement whereby such impoundment and reservoir will be con- structed and operated for the mutual benefit of the citizens and inhabitants of Fort Smith, Van Buren and surrounding areas, NOW, THEREFORE, in exchange of the mutual terms, conditions and obligations set forth herein, the parties agree as follows: 1. It is recognized that area needs call for a longterm approach to water management. Therefore, Fort Smith, giving due regard to initial cost and system demand, contemplates a phased construction schedule. The first stage of construction on the impoundment shall create a pool elevation of 420 MSL with associated water transmission and treatment facilities. Such project will be located at approximately Mile 3.2 on Lower Lee Creek. The initial dam section design shall anticipate either a future pool elevation of up to 480 MSL or an upstream impoundment with open channel trans- mission and shall include necessary components to embrace hydro- electric production if and when feasible. Initiation of subsequent stages will be dictated'by user demands on the System. This Agreement is made in contemplation of the above described first stage being constructed and thus this Contract and all pro- visions contained herein when properly authorized and executed, shall become effective and binding on the parties from date of execution. However, Fort Smith cannot be bound to construct such facilities until final engineering studies are completed and costs determined. Therefore, if no authorization for construction has been issued by Fort Smith within three (3) years from date of Agreement execution, this Agreement shall no longer bind the parties except to actions, such as survey work, etc., performed pursuant to the permission granted herein. If an authorization for construction of the impound- ment is issued within the time limit set forth above, the Agreement shall be effective throughout the actual service life of the impoundment, transmission and treatment facilities as contemplated herein. 2. Van Buren owns or has an interest in approximately 150 acres of real property (fee ownership) together with facilities constructed thereon and certain associated flowage, pipeline and road easements at the site of its Weir Impoundment, in Sections 4 and 5 of Township 9 North, Range 32 West, in Crawford County, and Van Buren owns approxi- mately 20 acres of land in Section 4 of said Township and Range. Said acreage and facilities, or portions of same, will be inundated by the reservoir to be constructed as contemplated by this Agreement. Van Buren extends its current permission to Fort Smith, its agents, servants, contractors and engineers, to do any and all necessary survey work, soil borings and otherwise have access to such properties for the purposes of the contemplated project. At the request of Fort Smith and after the authorization for the actual construction of the reservoir has been issued by Fort Smith, Van Buren will convey to Fort Smith by quit claim deed the tracts of property owned in fee by Van Buren and will convey to Fort Smith by quit claim deed its easement interests held for and in association with Van Buren's Weir Impound- ment and associated facilities, except that part of the 12" water line and associated easement interest not needed for the contemplated project. Additionally Van Buren retains the salvage rights to the existing equipment and pipeline now being used in conjunction with Van Buren's existing Weir. The properties referred to herein are more fully described in the attached conveyance from the United States of -2- America to Van Buren and the legal description of the 20 acre tract in Section 4 (attached as Exhibit "A" and "B and indicated in red on the attached Ownership and Acquisition Map (attached as Exhibit ,.c”) 3. In exchange for its contributions to the project, Van Buren is hereby granted and extended the rights and covenants of Fort Smith described in this paragraph. It is the general intention of this paragraph to recognize the spirit of cooperativeness between the two cities, acknowledging that Van Buren, upon authorization for actual construction, will convey to Fort Smith both tangible and intangible assets and acknowledging that Fort Smith has always been fair to Van Buren regarding both the quantity of treated water sold to Van Buren and to the rates charged for said water. With these factors in mind, the following rights and covenants are agreed to: First: With reference to the waterworks system of Fort Smith, Van Buren shall be treated as an ordinary, customary user of the Fort Smith water system and shall not be treated as a "surplus user That is, Fort Smith agrees that Van Buren's status as a user of the Fort Smith water system shall not be governed by any concept that Van Buren's use of the water from the Fort Smith system is of surplus water so that any of the legal or customary ramifications of such classification would follow. To the extent that the Fort Smith water system is able to supply water to its ordinary,customary users (its own citizens and users located within its corporate limits and Van Buren with there being no distinction between same), Van Buren will be supplied water in a quantity sufficient to meet its present and all future customer needs including, but not limited to, residen- tial, commercial and industrial customers. The quantity of water supplied to the City of Van Buren will not be restricted in any manner other than to the extent of any restriction imposed by Fort Smith on users located within the corporate limits of Fort Smith. Van Buren reserves the right to be more restrictive than Fort Smith with refer- ence to the usage of Van Buren's customers, but Van Buren agrees to impose at least those restrictions on its various classes of customers, residential, commercial and industrial, such as may be imposed by Fort Smith on such classes of customers located within the corporate limits of Fort Smith. -3- Second: With reference to consideration paid by Van Buren to Fort Smith for water supplied, the parties agree as follows: (1) Effective as of the date of this Agreement and continuing until changed by an Ordinance of Fort Smith (subject to the restrictions contained in this Agreement) or by a written contract between Van Buren and Fort Smith, Van Buren shall pay consideration for water supplied by Fort Smith at the same rates now being paid and established under Ordinance No. 3766 of Fort Smith adopted on the 2nd day of September, 1980; (2) From the date of this Agreement, it is understood/ agreed that the maximum consideration to be paid by Van Buren for water supplied by Fort Smith shall be determined by a scale of rates for water measured in cubic feet; which scale shall be so structured that the ratio between rates paid for water in ex- cess of 282,000 cubic feet per month as compared to the average of rates charged for water from 101 cubic feet /month through 16,000 cubic feet shall not exceed the existing ratio between such usage as established by Fort Smith Ordinance No. 3766 of 1980; (3) Irrespective of the provisions in Paragraph (2) above, Fort Smith shall never be required by application of such provision to sell water to Van Buren at a rate which produces revenue less than Fort Smith's actual cost of producing the water so sold as identified by a cost of service analysis utilizing the latest Ameri- can Water Works Association approved method and per- formed by a Professional Engineering firm mutually acceptable to both parties. Provided however, such cost of service analysis shall be limited to those items of cost directly attributed to existing and subsequent impoundments, pumping, treatment, and trans- mission cost expressed in cost /100 Cu. Ft. on total water sold to all users; (4) No special assessments, surcharges, meter charges, etc., will be applied to Van Buren, unless such charges are to be used for water impoundment, transmission and /or treatment purposes and also assessed against all Fort Smith's customers. Third: Fort Smith agrees to provide three (3) connection tees for Van Buren's use on the proposed transmission line at no cost to Van Buren. Size and locations of said connections shall be determined by Van Buren's engineer and incorporated into Fort Smith's plans, specifications and installation of said transmission line. Van Buren agrees to provide and maintain at its expense appropriate valves, reg- ulating valves and approved backflow preventers and proper meters for registering water used by Van Buren. It is agreed by Van Buren that Fort Smith or any of its agents or employees shall have unlimited right of access to such points of connections and physical facilities located thereon for any purpose associated with this Agreement. It is antici- pated that Van Buren will need additional future connections to Fort Smith transmission lines. Fort Smith agrees to provide said future connections at reasonable points and locations to be determined as -4- required. It is agreed that Fort Smith will make such future physical connections to their said existing transmission line and bill Van Buren actual cost of making the connection tap with associated fittings. Cost and providing of meter equipment shall be the same as provided for in preceeding paragraph. Fourth: It is agreed that Van Buren reserves the right to pro- vide service to any customer located within the current corporate city limit of Van Buren or the five mile planning jurisdiction presently established. A copy of the current Van Buren planning jurisdiction map is attached as Exhibit "D Fort Smith shall retain the right to serve any customer presently being directly served by Fort Smith and shall have the option of serving any new customer in this area should Van Buren be unable to provide service. 4. Fort Smith will provide all maintenance and operation expenses with reference to the impoundment, reservoir, transportation and treatment facilities constructed pursuant to this Agreement. 5. Van Buren agrees to provide whatever assistance (but not expenses) which is requested by the City of Fort Smith with reference to the acquisition of property rights for the construction of the project including participation in eminent domain proceedings. 6. The provisions of the parties' Agreement as set forth herein reflect the full and complete agreement of the parties. All discuss- ions, representations and warranties made by either of the parties to the other during negotiations leading up to this Agreement are hereby merged into this Agreement. The provisions of this Agreement may not be altered by the parties except by a written addition hereto approved by the governing bodies of the parties. Failure to exercise any right granted herein shall not be deemed as waiver of such right. It is expressly recognized that in the event the Water and Sewer Commission of the City of Van Buren should -cease to be a legally constituted body that the City of Van Buren will survive as the duly authorized party to carry out the obligations of and enforce the rights of "Van Buren" pursuant to this Agreement. 7. This Agreement is executed by the City of Fort Smith pursuant to a resolution of its governing body adopted on the 15th day of February 1983, this Agreement is executed by the City of -5- Van Buren pursuant to a resolution of its Council adopted on the 21st day of February 1983, and this Agreement is executed on behalf of the Van Buren Water and Sewer Commission pur- suant to a resolution of its Commissioners adopted on the 21st day of February 1983. 0 CITY OF FORT SMITH, ARKANSAS By: L t D RK Mayor ATTEST: J2 City Cle CITY OF VAN BUREN, ARKANSAS By: inu-dis 1 Mayor ATTEST: C ty Clerk- Treasurer VAN BUREN WATER AND SEWER COMMISSION By :40 ATTEST: J Secretary -6-