CCP 07-31-2006 - Laserfiche WebLink

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. . . REQUEST FOR COUNCIL ACTION DATE: 04/11/05 ITEM: Department Approval: Manager Reviewed: Agenda Section: Item Description: Approve a Wholesale Water Purchase Agreement with St. Paul Regional Water Services Background: Our wholcsale water contract with St. Paul Regional Water Services expired in May of2004. The City has purchased wholesale watcr from SPR WS sincc 1962 when our water distribution system was constructed. Roseville supplies wholesale water to the City of Arden Hills pursuant to an agreement with them. The City began preparation for negotiation of a ncw wholesale water contract in 200 I by studying altcrnatives to our existing agreement at that time. This study compared several long- tcrm options and their effect on water rates. These options included the City developing their own watcr source, a proposed new wholesale contract with SPR WS, and the City becoming a retail customer of SPRWS. The outcome of the study suggest cd the best options were a new wholesale contract or dcvcloping OLlr own water source. The Council directed staff to pursue a new wholesale contract in 2002. After numcrous discussions and scvcral itcrations of contract language, we are bringing a proposed contract to the Council for review and approval. Discussion: Staff and City Attorneys for both parties have reviewed the proposed contact. After approval by the Roseville City Council, thc proposcd contract will bc forwarded to the Board of Water Commissioners of the City ofSt. Paul for review and approval. SPRWS's initial rate proposal for wholesale watcr was 74.5% of the retail rate paid by St. Paul residents. Our expired contract resulted in an average rate of68% - 69% of the St. Paul residential rate. Thc key provisions of the proposed contract are: (see attached copy) . Wholcsale water rate to Roseville will be 71 % of the lowest seasonal rate charged to retail customcrs ofSPRWS. Term of agreement is 20 years. Assurance of water quality that meets state and federal drinking water standards. Quantity of water snpplied will mcet Roscvillc's needs in the foreseeable future . . . Financial Implications: The City budgets annually for purchase of approximately two billion gallons of potable water. Water ratcs have been adjusted upwards each of the past two years in anticipation of a new wholesale water contract. The rates in effect today will cover the increased rate for wholesalc water per the proposed contract. Future Roseville wholesale water purchases will be based on 71 % of the lowest seasonal rctail ratc in effect in St. Paul at that timc.