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CCR1983131RESOLUTION NO. 131 -83 AUTHORIZING SEWER CONTRACT WITH MILWAUKEE METROPOLITAN SEWERAGE DISTRICT WHEREAS, the Mayor, Sewer Committee Members, Attorney Dale W. Arenz. Engineer William Mielke, and Financial Consultant Seegar Swanson, Jr , have, since April, 1981, been attempting to negotiate a Sewer Service Contract with the Milwaukee Metropolitan Sewerage District; and WHEREAS, the territory located within the City of Muskego lies within the same drainage system as that of the District and the local sanitary sewers in such territory may be connected with and flow into the sewerage system of such Milwaukee Metropolitan Sewerage District for transmission and disposal, and WHEREAS, the said City of Muskego has applied to the District for permission to connect local sanitary sewers in said territory to the sewerage system of the Milwaukee Metropolitan Sewerage District for transmission and disposal of the sewerage from such territory; and WHEREAS, the City of Muskego has no effective alternative '' to acceptance of the services offered by the District because che alternative to construct its own plant would require approval by Southeastern Wisconsin Regional Planning Commission, the Covenor of the State of Wisconsin and the Department of Natural Resources, amongst others, and would delay the completion of the project considerably and would result in loss of tax incremental financing funds as well as reduce federal and state grants; and WHEREAS. the Milwaukee Metropolitan Sewerage District * has made the signing of this agreement a prerequisite for Milwaukee Metropolitan Sewerage District approvals of the plans and specifi- cations for the Muskego interceptor project; said approval is necessary for the City of Muskego to process its grant application for federal funding for said project; and its inability to conclude said agree- ment with the Milwaukee Metropolitan Sewerage District would result in the loss of $6,000,000.00 in federal funds; and e WHEREAS, the grant application for federal funding for the Muskego interceptor project requires an "intermunicipal agreement". Said requirement would be met by the execution of this interim agreement with Milwaukee Metropolitan Sewerage District; and WHEREAS, any further delay in Milwaukee Metropolitan Sewerage District's approval of plans and specifications for the Muskego interceptor project and the execution of an "intermunicipal agreemnt'' will cauee the City of Muskego to ~OHC wl:(:s:i t.o tlillnifi- cant amounts of tax incremental financing funds to finance the Muskego interceptor project as well as other Improvement projects within the City directly related to the Muskego interceptor project; and e WHEREAS, the Department of Natural Resources has brought an "enforcement action" against the City of Muskego in Waukesha County, Circuit Court, to require the City of Muskego to comply with various provisions in the City's discharge permit, which includes hookup to the Milwaukee Metropolitan Sewerage System. Said action could result in fines of up to $10,000 00 per day against the City of Muskego; and a - 2- r WHEREAS, the City feels that a Service Contract based upon flow vould be the fairest and most equitable method of computing capital cost recovery for the District but because of the time constraints and the potential loss of grants, funding and penalties. the City must enter into the proposed interim contract. NOW, THEREFORE, BE IT RESOLVED that pursuant to the provisions of Section 66.898, Wisconsin Statutes, the City of Muskego hereby agrees to the terms of the proposed interim contract with the exception that the present service area must be mapped and described and the amount to be paid by the City in 1983 determined and approved at a later date by this Council. a BE IT FURTHER RESOLVED that the Mayor and Clerk are authorized to execute this proposed interim contract and that the final approval of the service area and fee for 1983, be presented to the Council for final approval when completed. DATED THIS 104 DAY OF ATTEST: CITY CLERK -3- CONTRACT ENTERED INTO PURSUANT TO THE PROVISIONS OF SECTION 66.898, WISCONSIN STATUTES. BETWEEN CITY OF MUSKEGO AND THE MILWAUK~E METROPOLITAN SEWERAGE DISTRICT ~~ ~.~~ FOR THE TRANSMISSION AND DISPOSAL OF SEWAGE FROM TERRITORY LOCATED IN THE CITY OF MUSKEGO THIS INTERIM AGREEMENT, Bntered into at Milwaukee County, Wisconsin this day of , 19, by and between CITY OF MUSKEGO, hereafter "Muskego" or the "City", and the MILWAUKEE METROPOLITAN SEWERAGE DISTRICT, hereafter the "District"; I' i WITNESSETH; WHEREAS, the hereinafter described territory is located within the boundaries of the City but outside the present boundaries of the Milwaukee Metropolitan Sewerage District, but in the same drainage areas as the sewerage system of said District, and the local sanitary sewers in such territory may be connected with and flow into the sewerage system of such Metropolitan Sewerage District for transmission and disposal; and WHEREAS, the City has applied to the District for permission to connect local sanitary sewers in said territory to the sewerage system of the Milwaukee Metropolitan Sewerage District for transmission and disposal of the sewage from such territory; and WHEREAS, this agreement has been approved by action of the proper authorities of each of the Parties hereto; NOW, THEREFORE, pursuant to the provisions of Section 66.898, Wisconsin Statutes, it ia agreed between the Parties hereto BS follows: L A. The Dhtrlct hereby agrees to provide facilities so (u to permit the City to connect sanltary sewers in the territory described 89 follows, to-wit: -1- (Here insert description of 2005 Service Area located within Iluskego, to the District's sewerage treatment system.) B. Capital charges under this contract shall be determined based upon the area described as follows: (Here insert description of actual service area located within Muskego.) The actual service area includes all property located within 1000 feet of any parcel receivir)g or expected to receive sewer service within the calendar year being billed. The actual service area boundary shall be reviewed annually and amended by the District in accord with this paragraph. It is understood by the parties that the area described in this paragraph LE. contains an area outside the corporate boundaries of the City which area is within the corporate boundaries of the City of New Berlin and is commonly referred to as the Linne Lac subdivision. It is ah agreed, consistent with paragraphs I and ll herein, that no other areas outside the corporate boundaries of the City may be added by the City to the areas served by the District without an amendment to this Agreement. U. It is further agreed that additional are89 beyond the 2005 service area shall only be added as may from time to time be mutually agreed upon by the Parties hereta m. It is further agreed that the initial connections from the sewers in the territory described in Paragraph LA. above to the sewerage system of the Milwaukee Metropolitan Sewerage District shall not be made until the local sewerage system in such territory shall first have been approved in writing by the District and shall be maintained by the Clty as required by the Rules of the District. All approvals previously given by the District will be honored under this Agreement. -2- N. It is further agreed that the connection date shall be on or before December 31, 1984. The District will make all reasonable, good faith efforts to achieve this date. At the time when the District has made available to the City the connection, the City shall begin to pay District operation end maintenance user fees as established by Article XVII of the District Rules and Regulations, those Rules end Regulations may be amended. $ On or before December 31, 1983, the City of Muskego agrees to pay a capital charge to the District in the amount of in partial consideration for the District's ageement to connect the City to its wastewater treatment system. In further consideration for this Agreement, for each calendar year beginning with the year in which connection is made available by the District continuing until termination of this contract, the City agrees to pay the Muskego share of the total actual capital needs of the District for each respective calender year. The "Muskego share" shall be computed for each calendar year in a manner identical to the computation of capital contribution made by the District for each municipality inside the District boundary. In making the Muskego computation the District shall add the relevant factors concerning Muskego, under the terms of this contract, to the assumptions within the District calculation as if Muskego was within the District corporate boundaries. The "Muskego share" shall be based upon the actual service arm within Muskego, the boundaries of which area are as Set forth in Paragraph LB. above or as shall be amended from time to time under Paragraph LE. above. Muskego acknowledges that the District may determine whether to credit the Muskego share against the District communities' contribution in the current year or in the succeeding year. In the event that the District excludes the Muskego share from the computation of the rate for capital recovery for a given year beyond the grace year provided in the previous sentence, then in computing the rate for Muskego's share, -3- P an adjustment shall be made to reflect that contribution for the preceding year for which it was paid. Such adjustment is conditioned upon Muskego being current in all payments e under the contract. Beginning with calendar year 1985 and each year thereafter until termination of this Agreement, Muskego agrees to pay to the District all capital charger as billed and computed by the District. Muskego hFeby agrees to pay in full each and every capital billing rendered by the District under this contract. Muskego agrees not to dispute any capital billing rendered by the District except on the grounds that a billing has not been computed pursuant to this Agreement. * AU terms of this contract shall remain in effect until the earliest of the following events occurs: (1) the City of Muskego is incorporated into the District; or (2) the date on which the successor contract is executed between the District and Muskego; or (3) the date on which the majority contract is executed by Muskego; or (4) the date on which a final decision or judgment, including exhaustion of all possible appeals, resolving all disputes regarding the method of determination of capital charges by the District for Muskego is rendered and entered by a court or administrative body. The "?accessor contract" is defined as the next contract executed between the City and the District. Any formula for capital recovery, other than the ad valorem formula as specified herein, which is contained in any contract between the District and any other contract community which is executed alter the date of this Agreement shall be offered to the City by the District. Said capital recovery formula shall be incorporated into this Agreement by amendment and such amended contract shall not be considered to be a "successor contract" as that term is denned herei? e 4 A "majority contract" is defined as that District and a majority of its contract communities at any time after the date of -4- execution of this contract between the City and the District. Muskqo is required to 0 accept all terms of the majority contract at such time as a majority of contract communities have executed such contract. The District "contract communities" are identified, for purposes of this paragraph, as: Bayside , Brookfield 'Butler Caddy Vista Elm Grove Menomonee Falls Mequon New Berlin Muskego If the majority contract becomes the next contract between the City and the District then it is the successor contract. In the event the successor contract with 0 Muskego or a final court or administrative decision (including exhaustion of all possible appeals) provides for a capital cost recovery forrnuk based on a capital recovery computation other than the computation defined in this Agreement, the District agrees to credit to the City, beginning with charges for 1986, the differential between the charges computed under this contract and those which would have been computed for the same billing year under the successor contract or court or administrative decision. Likewise, if the differential between the rate under this Agreement and under the successor contract or court oc administrative decision favors the District, the City agrees to pay said differential to the District. If the differential &suibed in this paragraph favors the City, the total amount of the differential shall be credited to the City against each District mud capital billlng in an amount not to exceed 50% of the 0 annual billing by the Dlstrict until the entire differential shall be exharrsted. If the differential described in this paragraph favors the District, the total amount of the differential shall be paid annually to the District until the entire differential shall be -5- exhausted. In the event that the method of computation of capital charges which is included in the successor contract or final court or administrative decision utilizes a e depreciation rate applicable to District assets to arrive at a capital charge, then, in lieu of the credit rate specified above, the credit to Muskego under this Agreement shall be made at an annual rate equal to the average depreciation rate applied in the charge computation. No interest shall be p d or received by either party on any differential credit or charge under this paragraph. a- .i. In the event the successor contract with !duskego or court or administrative decision provides for a capital cost recovery formula based partly or wholly on equalized property value, expenses actually incurred by the City of hluskego for the design and construction of the portion of the Franklin Muskego Interceptor within the City of Muskego shall be credited on a pro rata basis to Muskego by the District. "Expenses actually incurred" by the City shall include only local funds of the City, including principal and interest on bonded debt of Muskego up to a rate equal to the District's cumulative rate of interest. The "Franklin Muskego Interceptor" is defined as the interceptor described by plans titled Northeast 24 Inch Sewage Force Main to the County Line, Contract 583, stamped by William J. Mielke, P.E., dated March 29, 1983. The District shall determine the pro rata basis for the credit under this paragraph by multiplying the "expenses actually incurred" by Muskego times the quotient of that portion of total capital billing to Muskego under the successoc contract or final court or administrative decislon to be paid on the basis of equalized value divided by the total capital billing to Muskego under the successor contract or final court or administrative decision. This pro - rata credit shall be determined based upon values usd during the first e year of billing under the successor contract or fi~l court or administrative decision. Expenses actually Incurred on or before the date of execution of the successM contract e - -6- or final court or administrative decision shall be credited against annual District billings to Muskego in an amount not to exceed 50% of the annual billing by the District until the total credit under this paragraph is exhausted. Thereafter, the District shall make provision for payment of its pro - rata share of Muskego's debt arising from construction of the interceptor described in this paragraph which remains to be paid after the date of execution of the successor contract opfinal court or administrative decision. (" It is further agreed that nothing contained herein shall be used by either party as any evidence of a compromise of either party's respective positions on the successor service contract terminology nor shall this contract be used as precedent with respect to Muskego or any other contracting party in any court, administrative, or other proceeding wherein the terms of the successor service contract are in dispute. More specifically, nothing contained herein shall be construed or used by either party as proof or evidence that either party has assented to any particular mode, theory, and/or formula for service and/or payment for services contracted for herein The parties agree that the payments for service herein described are based upon negotiated figures deemed by the parties to this contract to be appropriate under all of the circumstances surrounding the making of this contract. In the event that a connection is not made available to the City by the District on or before January 1, 1985 then the City shall be relieved of 1/12 of its annual capital charge each month until the connection is available. A connection is available when a District interceptor sewer has been completed and approved by the District for w by the City. V. The capital charge determined under this contract will include all costs involved In operation and obtaining sewage quantities at one gauging station. Should it become nccesary to obtaln readings at more than one gauging station, due to the character of -7 - . the contract area system, a fixed charge of One Thousand Dollars ($1,000.00) per year per extra gauging station will be made wherever continuous gaugings are required. VL Payments for capital recovery hereunder beginning for the calendar year 1985 shall be made as follows: Bills shall be computed by the District and shall be rendered on or before December 15th of the prior year for the next calendar year and shall be paid by the City to the District not later than the ensuing April 1. , .. v n. It is further agreed that all or any capital charges made by the District against the City for treatment services, which are not paid by the City by April 1 of the calendar year being billed, shall be subject to a further charge of one percent (1%) for each month or fraction thereof until paid. The City agrees it has no authority to withhold payment in the event that my annual capital charge billing or operation and maintenance billing is disputed by the City, and further agrees that it will not withhold any portion of payment for services as billed by the District. The City agrees that it may not withhold all or any portion of payments due according to District billings. The City agrees that before it may contest the reasonableness of any billing under this contract, it must first have paid the full amount to the District. The City agrees that its sole remedy is to seek a refund of any payment which it challewes. Vm. This contract shall continue in full force and effect and shall terminate only on the date when the City of Muskego is incorporated within the District boundary, or on the date when the City of Muskego executes the successor contract with the District, or on the date when ultimate resolution of capital charge disputes is rendered by a Court Or -a- administrative body. The City of Muskego agrees that the District is entering into this contract in reliance on Muskego's commitment that it will remain a continuous, long term user of District services and that it will not terminate this Agreement at any time before the year 2005 A.D. * IX. The City of Muskego agrees that with respect to the territory hereinbefore described, it will in every way comply with all lawful rules and regulations of the District, or its respective successors, and any such laws hereinafter passed relatirg thereto. Y A. It is further agreed between the Parties hereto that upon failure of the City of Muskego to comply with the terms and provisions hereof, or in case of its failure to comply with the rules and regulations made by the District, or its successors, that in such case, or in either of such cases, this Agreement may, at the option of the District, be terminated and the sewers located in the territory hereinbefore described be disconnected from the sewers of the Milwaukee Metropolitan Sewerage District. 0 XL This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective SUCC~~~~R and assigns, or such public boar&, commissions, or entitles 83 shall succeed substantially to the righto, powers and duties of the Parties hereto respectively. XIL 0 Judicial invalidatlon of any article, section, subsection, paragraph, clause, phrase or other provision of this Agreement shall have no effect on the validity or enforceability Of My other provision of this Agreement -9- The parties hereby agree that the capital recovery method estabIished under this contract is an essential and material term of this Agreement. XUI. It is expressly understood and agreed that any prior contracb between these Parties will be nullified and this contract will take the place of all of those contracts. IN WITNESS THEREOF, this agr ement has been executed on behalt of the City of Muskego pursuant to a resolution and dated the day of J 19 , and by the Milwaukee MetropoIitan Sewerage District pursuant to a resolution adopted on the day of , 19 . f Approved as to form this day of , 19 . CITY OF MUSKEG0 BY Mayor 0 City Attorney of the City of Muskego City Clerk SEWERAGE DISTRICT MILWAUKEE METROPOLITAN Chairman Secretary -10-