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<br />. <br /> <br />. <br /> <br />. <br /> <br />~ <br />~~HILLS <br /> <br />MEMORANDUM <br /> <br />DATE: <br /> <br />7F <br /> <br />July 31, 2006 <br /> <br />AGENDA ITEM: <br /> <br />TO: Mayor and City Council <br /> <br /> <br />FROM: Michelle Wolfe, City Administrator i <br /> <br /> <br />SUBJECT: Approval of Water Services Contract between the City of Arden Hills and the <br /> <br />City ofRosevillc <br /> <br /> <br />BACKGROUND <br /> <br />The City of Arden Hills contracts with the City ofRoseville for Waler Services. This agreement <br />allows the City to purchase water from the City of St. Paul via Roseville. Roseville has been <br />providing water to Ardcn Hills continuously since 1963. <br /> <br />The most rccent contract between the City ofRoseville and City of St. Paul expired on May 24, <br />2004. Eflectively our contract with Roseville expired that same date. Roseville began reviewing <br />thcir water needs in 200 I, and decided to stay with the City of St. Paul. They approved a new <br />contract with St. Paul in April 2005 and the contract went into effect after the St. Paul Board of <br />Water Commissioners approved it. Thc prcvious contract was a twenty year contract. The new <br />contract is also for twenty ycars. <br /> <br />DISCUSSION <br /> <br />Perhaps the most important change in the new contract is pricing. The previous contract bctwecn <br />St. Paul and Roseville had a tiered structure which resulted in an average rate of 68%-69% of the <br />retail rate paid by St. Paul residents. The new contract eliminates the tiered system and charges <br />71% of the rctail rate paid by St. Paul residents. We will pay this same rate to Roseville based <br />on usage. Additional fees will be paid to the City of Roseville as outlincd in the contract on page <br />4, Section V1. <br /> <br />This contract has been reviewed by City Attorney Filla. The contract will commcncc upon <br />approval by the cities of Arden Hills, Roseville, and St. Paul and remain in effect until December <br />31, 2024. If either party desires to terminate the contract, they must provide one year's written <br />notice to the other party. (It should bc noted that in the contract between St. Paul and Roseville, <br />only six months notice is required.) <br /> <br />] believe that this contract is in thc best interests of thc residents of Arden Hills. My <br />understanding is that Minneapolis water rates are higher, so we appear to be receiving a fair rate <br />from St. Paul. I am not aware of any other options available to us at this time, and the currcnt <br />