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August 19, 2003 Agenda
AGENDA CITY OF DENTON CITY COUNCIL August 19, 2003 After determining that a quorum is presem, the City Council will convene in a Work Session on Tuesday, August 19, 2003 at 4:00 p.m. in the Council Chambers at City Hall, 215 E. McKinney Street, Denton, Texas at which the following items will be considered: Requests for clarification of consent agenda items listed on the consent agenda for today's City Council regular meeting of August 19, 2003. The City Council will attend a reception for Board and Commission members at 4:30 p.m. in the Council Work Session Room at City Hall. The City Council will convene in the Council Chambers at 6:00 p.m. at which the following item will be considered: 1. Consider approval of a resolution of appreciation for retiring Board/Commission members. NOTE: The City Council reserves the right to adjourn imo a Closed Meeting on any item on its Open Meeting agenda consistent with Chapter 551 of the Texas Government Code, as amended. Regular Meeting of the City of DeNon City Council on Tuesday, August 19, 2003 at 6:30 p.m. in the Council Chambers at City Hall, 215 E. McKinney Street, Denton, Texas at which the following items will be considered: 1. PLEDGE OF ALLEGIANCE mo U.S. Flag Texas Flag "Honor the Texas Flag -- I pledge allegiance to thee, Texas, one and indivisible." 2. PROCLAMATIONS/PRESENTATIONS A. Proclamations/Awards B. August Yard-of-the-Momh Awards C. Recognition of staff accomplishments 3. CITIZEN REPORTS mo Receive citizen reports from the following: 1. Robert Kam regarding public transportation and Demon Branch Rails to Trails. 4. CONSENT AGENDA Each of these items is recommended by the Staff and approval thereof will be strictly on the basis of the Staff recommendations. Approval of the Consem Agenda authorizes the City Manager or his designee to implement each item in accordance with the Staff recommendations. City of DeNon City Council Agenda August 19, 2003 Page 2 The City Council has received background information and has had an opportunity to raise questions regarding these items prior to consideration. Listed below are bids, purchase orders, contracts, and other items to be approved under the Consem Agenda (Agenda items A-V). This listing is provided on the Consem Agenda to allow Council Members to discuss or withdraw an item prior to approval of the Consem Agenda. if no items are pulled, Consem Agenda items A-V below will be approved with one motion, if items are pulled for separate discussion, they will be considered as the first items following approval of the Consent Agenda. mo Consider approval of a resolution of the City of DeNon, Texas announcing that it will vote on a tax rate at its regularly scheduled meeting of September 2, 2003; providing for publication of notice of such vote on the tax rate; and providing an effective date. Bo Consider adoption of an ordinance authorizing the City Manager to execute an addendum to contract between the City of Denton, Upper Trinity Regional Water District and the City of Lewisville concerning Reuse of Water from Cooper (Chapman) Lake; providing for the expenditure of funds therefor; and providing for an effective date. Co Consider adoption of an ordinance accepting competitive bids and awarding an annual contract for the purchase of electric distribution cables; providing for the expenditure of funds therefor; and providing an effective date (Bid 3043 - Annual Price Agreement for Electric Distribution Cables awarded to Techline, Inc. in the estimated amoum of $471,050). Do Consider adoption of an ordinance accepting competitive bids and awarding an annual contract for the purchase of front load refuse containers; providing for the expenditure of funds therefor; and providing an effective date (Bid 3044 - Annual Price Agreement for Front Load Refuse Containers awarded to Wastequip May Fab in the estimated amoum of $110,000). mo Consider adoption of an ordinance accepting competitive bids and awarding an annual contract for the purchase of electric distribution conductors; providing for the expenditure of funds therefor; and providing an effective date (Bid 3046 - Annual Price Agreement for Electric Distribution Conductors awarded to Priester Supply in the estimated amoum of $200,000). Fo Consider adoption of an ordinance accepting competitive bids and awarding an annual contract for the rental of heavy equipment; providing for the expenditure of funds therefor; and providing an effective date (Bid 3053 - Annual Price Agreement for Rental of Heavy Equipment awarded in the estimated amount of $500,000). Go Consider adoption of an ordinance accepting competitive bids by way of an interlocal Agreement with Tarrant County and awarding a contract for the purchase of cellular phone services; providing for the expenditure of funds therefor; and providing an effective date (File 3064 - imerlocal Agreemem with Tarrant County for the purchase of cellular phone services, contract awarded to Progressive Concepts, inc. in the amoum of $175,000). City of DeNon City Council Agenda August 19, 2003 Page 3 Ho Consider adoption of an ordinance awarding a comract for the purchase of wireless communication services as awarded by the State of Texas Building and Procuremem Commission; providing for the expenditure of funds therefor; and providing an effective date (File 3063 to Nextel Communications in the annual estimated amoum of $99,600). Consider adoption of an ordinance authorizing the City Manager or his designee to enter into an agreement with Bank One, NA and to participate in an agreement between Bank One, NA and the Texas Building and Procuremem Commission relating to the use of purchasing cards; repealing Ordinance 99-285; authorizing the City Manager or his designee to make expenditures set forth in the contract; and providing an effective date (File 3068 - Agreement 946-AI between the State of Texas Building and Procuremem Commission/Bank One NA, and the City of DeNon for a Purchasing Card System). Jo Consider adoption of an ordinance of the City of DeNon, Texas approving an agreement between the City of Denton and the Denton Record Chronicle; approving the expenditure of funds for the purchase of legal advertising services available from only one source in accordance with the provisions of the state law exempting such purchases from requirements of competitive bids; and providing an effective date (File 3065 - Agreemem with the DeNon Record Chronicle in the amoum of $7.60 per column inch for an estimated award of $30,400). Ko Consider adoption of an ordinance of the City of DeNon, Texas authorizing the City Manager to execute an agreemem for professional legal services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., for legal services pertaining to represemation of the City before the Public Utility Commission of Texas, in the areas of public utility regulatory law and administrative law, respecting DeMon's compliance with Public Utility Commission of Texas Electric Transmission Service Rules; authorizing the expenditure of funds therefor; providing for retroactive effect of the agreement; and providing an effective date. Lo Consider adoption of an ordinance of the City of DeNon, Texas authorizing the City Manager to execute an agreemem for Professional Legal Services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., for legal services pertaining to represemation of the City before the Public Utility Commission of Texas, in the areas of Public Utility Regulatory Law and Administrative Law, respecting the protection of the City's interests relating to competition transition charges and transition charges by municipally owned utilities or by customers of municipally owned utilities; authorizing the expenditure of funds therefor; providing for retroactive effect of the agreement; and providing an effective date. Mo Consider adoption of an ordinance of the City of DeNon, Texas authorizing the City Manager to execute an Agreement for Professional Legal Services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., for legal services pertaining to represemation of the City before the Public Utility Commission of Texas, in the areas of Public City of DeNon City Council Agenda August 19, 2003 Page 4 Utility Regulatory Law and Administrative Law, respecting the protection of the City's imerests relating to efforts by the Public Utility Commission of Texas to change the currem design of the Electric Reliability Council of Texas wholesale power market in Texas; authorizing the expenditure of funds therefor; providing for retroactive effect of the agreement; and providing an effective date. Consider adoption of an ordinance of the City Council of the City of Denton, Texas authorizing the City Manager to execute a Professional Services Agreement with R. J. Covington Consulting, LLC for consulting services relating to Task Order No. 03-H, regarding the market design issue of moving the Electric Reliability Council of Texas to a nodal transmission pricing system, relating to Denton Municipal Electric; authorizing the expenditure of funds therefor; and providing an effective date. No Consider adoption of an ordinance of the City of DeNon, Texas authorizing the City Manager to execute a Professional Services Agreement with R.J. Covington, LLC for consulting services relating to Task Order No. 03-G, for services pertaining to representation of Denton Municipal Electric before Electric Reliability Council of Texas, provision of analysis and technical support related to regulatory and competitive issues, monitoring and evaluation of electric industry activities; authorizing the expenditure of funds therefore; providing for retroactive effect of the agreement and providing an effective date. Oo Consider adoption of an ordinance authorizing the City Manager, or his designee, to file an application, execute grants, and subsequent amendments with the U.S. Department of Transportation Federal Transit Administration and the Texas Department of Transportation for grants authorized by 49 U.S.C. §5307, and other applicable laws; and providing for an effective date. Po Consider adoption of an ordinance establishing the fares to be charged for motor carrier passenger service provided by LINK; superceding ordinances in conflict with this ordinance; and providing for an effective date. Qo Consider adoption of an ordinance of the City of DeNon, Texas approving the City's participation for itself, and on behalf of DeNon County under an Imerlocal Agreement between the City and Denton County, in the Texas Department of Transportation Off-System Bridge Replacement Program as authorized by Texas Administrative Code, Title 43, Section 15.55(d); authorizing the City Manager or his designee to execute on behalf of the City and County all documems or agreements necessary to carry out the program; and providing an effective date. Ro Consider adoption of an ordinance correcting and amending Ordinance No. 2002- 408 pertaining to the acquisition of certain real property interests through purchase or condemnation proceedings, such real property being a part of the M.T. Cole property described in a deed recorded in volume 249, page 387 of the Deed Records of Denton County, Texas, located in the B.B.B. and C.R.R. Survey, City of DeNon City Council Agenda August 19, 2003 Page 5 Abstract No. 176, the J. Kjelberg Survey Abstract No. 1610, the J. Bacon Survey Abstract No. 1540, the I. Hembrie Survey Abstract No. 594, and the I. Byerly Survey Abstract No. 1458, Denton County, Texas; Declaring an effective date. (West Electric Project) Consider approval of a resolution of the City Council of the City of DeNon, Texas, replacing a policy for tax abatement for the City of Denton to establish guidelines and criteria governing tax abatement agreements; and declaring an effective date. Consider adoption of an ordinance approving a license agreemem between the City of Denton and the First United Methodist Church of Denton, Inc. to continue to allow use of a building at Evers Park for Boy Scout activities; and providing an effective date. Consider approval of a resolution of the City of DeNon, Texas calling a public hearing to consider establishing a reinvestment Zone VI for Flowers Foods Bakeries Group, LLC; and declaring an effective date. Consider approval of three exaction variances for a parcel comaining approximately 12 acres and is located on the north side of Jim Christal Road west of the GC & SF Railroad. The property is curremly in an Industrial Cemer- Employmem (lC-E) zoning district. The property is curremly developed and no new construction is proposed. The Planning and Zoning Commission recommends approval of the variances as proposed by the applicam and conditioned by City staff. Planning and Zoning recommends approval (7-0). Wo3-oo/8) Section 35.20.2(L.3.a.) of the Code of Ordinance concerning improvements to a perimeter street; Section 35.20.3(B.) of the Code of Ordinance concerning perimeter sidewalks; and Section 35.20.2(H. 1 .) of the Code of Ordinance concerning the dedication of right of way for all streets that serve a commercial lot (regarding ROW for a cul-de-sac at the end of Jim Christal Road at its intersection with the GC & SF Railroad). 5. PUBLIC HEARINGS Hold a public hearing on a proposal to adopt a tax rate of .54815 per $100 valuation, which will exceed the lower of the rollback rate or 103 percent of the effective tax rate. Hold a public hearing and receive citizen input on the 2003-2004 proposed budget. Hold a public hearing to afford the public appropriate notice and participation for the purpose of commeming on the cable television franchise application filed by Denton Telecom Partners I, LP d/b/a Advantex Communications, with the City of Denton. City of DeNon City Council Agenda August 19, 2003 Page 6 6. ITEMS FOR INDIVIDUAL CONSIDERATION mo Consider adoption of an ordinance of the City of DeNon, Texas establishing an Economic Development Partnership Board; and providing an effective date. B. Consider appointmem of two City Council members and one Chamber of Commerce board member to the Economic Development Partnership Board Nominating Committee. Co Consider nominations/appoimmems to the following boards and commissions: 1. Community Developmem Advisory Committee 2. Library Board 3. Parks, Recreation and Beautification Board Do New Business This item provides a section for Council Members to suggest items for future agendas or to request information from the City Manager. mo Items from the City Manager 1. Notification of upcoming meetings and/or conferences 2. Clarification of items on the agenda Fo Possible Cominuation of Closed Meeting under Sections 551.071-551.086 of the Texas Open Meetings Act. Go Official Action on Closed Meeting Item(s) under Sections 551.071-551.086 of the Texas Open Meetings Act. CERTIFICATE I certify that the above notice of meeting was posted on the bulletin board at the City Hall of the City of DeNon, Texas, on the day of ,2003 at o'clock (a.m.) (p.m.) CITY SECRETARY NOTE: THE CITY OF DENTON CITY COUNCIL CHAMBERS IS ACCESSIBLE IN ACCORDANCE WITH THE AMERICANS WITH DISABILITIES ACT. THE CITY WILL PROVIDE SIGN LANGUAGE INTERPRETERS FOR THE HEARING IMPAIRED IF REQUESTED AT LEAST 48 HOURS IN ADVANCE OF THE SCHEDULED MEETING. PLEASE CALL THE CITY SECRETARY'S OFFICE AT 349-8309 OR USE TELECOMMUNICATIONS DEVICES FOR THE DEAF (TDD) BY CALLING 1-800- RELAY-TX SO THAT A SIGN LANGUAGE INTERPRETER CAN BE SCHEDULED THROUGH THE CITY SECRETARY'S OFFICE. in ~preciation o[ "~etiring ~oerb 5~nb ~ommi~ion ~ltlember~" WHEREAS, the services performed by the City of Denton's Boards and Commissions are of great value to the Denton City Council; and WHEREAS, the City Council wishes to commend the members of the City's Boards and Commissions for the many hours of volunteer service they devote to the betterment of our community; and WHEREAS, the City Council desires to publicly acknowledge its appreciation to the retiring members of all Denton Boards and Commissions; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: That the sincere and warm appreciation to the retiring members of the City's Boards and Commissions, felt by the citizens and staff of the City of Denton, be formally conveyed to them in a permanent manner by recording this Resolution upon the official minutes of the City of Denton; and BE IT FURTHER RESOLVED: That the City Council of Denton does hereby officially and sincerely extend its best wishes to the retiring Board and Commission members to continue to serve our community. PASSED AND APPROVED this the day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY EUL1NE BROCK, MAYOR BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Fiscal Operations, Tax Department Kathy DuBose, Fiscal and Municipal Services SUBJECT Consider a resolution of the City Council of the City of Denton, Texas announcing that it will vote on a tax rate at its regularly scheduled meeting of September 2, 2003; providing for publication of notice of such vote on the tax rate; and providing an effective date. BACKGROUND In the Friday, August 1, 2003, Reading File, staff provided Council with a copy of the required notice of effective tax rate calculation to be published in the Sunday, August 3 newspaper. Municipalities are required to publish their rollback tax rates in the newspaper, along with the effective tax rate and other required schedules. The rollback tax rate divides the overall property taxes imo two categories--maimenance and operations (M&O) taxes and debt service taxes. By law, the rollback rate for taxing units are set at an eight percem (8%) increase in operating (M&O) taxes. The effective tax rate is generally the property taxes divided by the current year's taxable value of properties that were on the tax roll in both years. This rate excludes taxes on properties no longer in the taxing unit and also excludes the currem taxable value of new properties (growth). The City of DeMon's effective rate is $.53166/$100 valuation and the rollback rate is $.69912/$100 valuation. The Property Tax Code specifies that "if a taxing unit (other than a school district or small taxing unit) proposes a tax rate that exceeds the lower of the rollback rate or 103 percent of the effective tax rate, the taxing unit's governing body must vote to place the proposal to adopt the tax rate on the agenda of a future meeting as an action item". While the proposed 2003-04 budget keeps the current .54815 rate unchanged, it is 103.1% of the effective tax rate and requires a public hearing. ESTIMATED SCHEDULE 08/05/03 08/10/03 08/19/03 08/24/03 09/02/03 Vote to place Proposal on Future Agenda Publish Required Notice Hold Public Hearing Publish Second Required Notice Adopt Tax Rate PRIOR ACTION/REVIEW City Council held a budget work session on August 7, 2003. FISCAL INFORMATION The proposed property tax rate is included in the 2003-04 proposed budget. Respectfully submitted: Diana G. Ortiz Director of Fiscal Operations RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS ANNOUNCING THAT IT WILL VOTE ON A TAX RATE AT ITS REGULARLY SCHEDULED MEETING OF SEPTEMBER 2, 2003; PROVIDING FOR PUBLICATION OF NOTICE OF SUCH VOTE ON THE TAX RATE; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, at its regularly scheduled meeting of August 5, 2003, the City Council voted to place a proposal on the September 2, 2003 City Council regular meeting to adopt a proposed tax rate of $.54815 per $100 valuation, which will exceed the lower of the rollback rate or 103 percent of the effective tax rate; and WHEREAS, the City Secretary duly recorded the vote of the City Council on that matter; and WHEREAS, the City Council also called a public hearing for its regular meeting of August 19, 2003 on the tax increase; and WHEREAS, publication of notice of that public hearing on the tax increase was made in accordance with the law, and said public hearing was held on August 19, 2003 and all proponents and opponents of the tax increase were given an adequate opportunity to present their views at the public hearing; and WHEREAS, the City Council wishes to finally set the date, time, and place of the meeting at which it will vote on the tax rate; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: SECTION 1. The City Council will vote on the proposed tax rate at its regularly scheduled meeting of September 2, 2003, which will commence at 6:30 p.m. and will be held in the City Council Chambers at City Hall at 215 East McKinney, Denton, Texas 76201. SECTION 2. Prior to the vote on the tax rate, the City Manager and the Assistant City Manager for Fiscal & Municipal Services are directed to publish in the Denton Record- Chronicle, a newspaper having general circulation in the City, the attached Notice of Vote on the Tax Rate, which is made a part of this resolution for all purposes, such publication to be in compliance with the requirements of the Texas Tax Code. SECTION 3. This resolution shall become effective immediately upon its passage and approval at a regular meeting of the City Council of the City of Denton, Texas on this the 19th day of August, 2003, at which meeting a quorum was present and the meeting was held in accordance with the provisions of Tex. Gov't Code §551.001, et seq. The City Secretary is hereby advised to record this resolution and the vote on the proposal to place the item for a tax increase on the September 2, 2003 City Council agenda. PASSED AND APPROVED this the __day of .,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: Councilmember Euline Brock, Mayor Mark Burroughs, Mayor Pro Tem Pete Kamp Perry McNeill Bob Montgomery Raymond Redmon Jack Thomson Voted For Voted Against Page 2 Notice Of Vote on Tax Rate The City of Denton, Texas conducted a public hearing on a proposal to increase the total tax revenues of the City of Denton, Texas from properties on the tax roll in the preceding year by 3.1 percent on August 19, 2003 at 6:30 p.m.. The City Council of the City of Denton, Texas is scheduled to vote on the tax rate that will result in that tax increase at a public meeting to be held on September 2, 2003 6:00 p.m. at the City Council Chambers at City Hall located at 215 E. McKinney, Denton, Texas 76201 AGENDA INFORMATION SHEET AGENDA DATE: August 19, 2003 DEPARTMENT: W/WW Utility ACM: Howard Martin, 349-8232 SUBJECT: Consider adoption of an ordinance authorizing the City Manager to execute and addendum to comract between the City of DeNon, Upper Trinity Regional Water District and the City of Lewisville concerning Reuse of Water from Cooper (Chapman) Lake; providing for the expenditure of funds therefor; and providing for an effective date. BACKGROUND: The City of DeNon and the Upper Trinity Regional Water District (UTRWD) negotiated an agreement on August 4, 1998 referred to as the "pass through agreement". This agreement allowed the use of Denton's water conservation pool in Lake Lewisville for transferring UTRWD's imported water supply from Lake Chapman (formerly called Cooper Lake) via a bed and banks permit to their existing water intake on Lake Lewisville. This pass through agreement allowed the use of Lake Lewisville to transport the UTRWD's imported water more economically than being required to pipe this water the additional distance to their existing water treatment plant. The City of Irving also has water rights in Lake Chapman and entered into a similar agreemem with the City of Dallas to pass their water supplies through Lake Lewisville where they would then be released downstream and be treated by the City of Dallas under the terms of their contract agreement. Unlike the Irving / Dallas agreement, the Denton / UTRWD pass through agreement did not allow the use of Denton's conservation pool in Lake Lewisville for terminal storage, requiring all unused water imported by the end of each month to be given to Denton as a protective restriction to avoid use of Denton's limited storage in Lake Lewisville. The Denton / UTRWD pass through agreement was designed to support the UTRWD's importation of it's new water supply source while protecting the City of Denton's existing water supply. As such it was restrictive and protective but accommodating and supportive for both parties. During the negotiations of this agreement the UTRWD expressed a strong desire to obtain Denton's approval of UTRWD's reuse of wastewater return flows that are discharged back into Lake Lewisville. Although Denton was agreeable to support UTRWD reuse, in principle, staff was originally concerned on the accouming procedures to be used to determine the quamity of this reuse benefit to be provided to the UTRWD. The 1998 pass through agreement between Denton and the UTRWD included language that supported a UTRWD reuse permit but required the UTRWD to present details on it's reuse permit proposal and required Denton's approval of this plan. During the time period since the pass through agreement was finalized, the UTRWD has since completed the following items to facilitate the importation of their Lake Chapman water supplies: The UTRWD entered into a contract with the City of Irving to use their pipeline and pump station facilities to transport UTRWD (along with City of irving water) from Lake Chapman imo Lake Lewisville. The UTRWD obtained a bed and banks permit from the TNRCC to use waters of the state to transport UTRWD's Lake Chapman water from the Irving pipeline discharge poim (on Doe Branch upstream of Lake Lewisville near Hwy 380 west of DeNon) through Doe Branch Creek and Lake Lewisville. This permit was only for the imported water and did not include provisions for the permit required to allow a similar transport of wastewater return flows into Lake Lewisville. The UTRWD provided the City of DeNon and the City of Dallas with their wastewater reuse proposal that was rejected by both emities due to two major concerns. These include the UTRWD's proposed "multiple pass through concept" and "assignment" of Lake Chapman water supplies to specific customers that had a means of returning their wastewater return flows back into Lake Lewisville. In spite of not receiving DeMon's approval of the reuse accouming proposal (as required by the Denton / UTRWD pass through agreement), the UTRWD filed for a reuse permit with the TNRCC (now referred to as the TCEQ) on August 30, 2002 (Exhibit i). As a result of the UTRWD's failure to compromise their position of their reuse proposal and proposed accouming methodology, both the City of Dallas and the City of DeNon (Exhibit ii) filed written protests to the TCEQ/TNRCC requesting for a contested case hearing to be held prior to the TCEQ/TNRCC issuing the reuse permit. As an initiative to maintain a tighter control of the accounting method to be used to determine the appropriate volume of wastewater reuse credit for the UTRWD while protecting the existing water supply rights of both Denton and Dallas, the City of Dallas introduced a their own contract proposal with the UTRWD to manage the reuse portion of the UTRWD Lake Chapman water supplies. Denton staff has been an active participant in the development of this contract agreement and the City of Dallas has worked cooperatively with Denton to insure that the terms and conditions were agreeable to Denton and did not conflict with the existing terms and conditions of the 1998 Denton/UTRWD pass though agreement. Although the City of Denton was a participant in this contract negotiation they are not a specific party that is required to sign the agreement. The UTRWD has since agreed to the terms and conditions outlined in the proposed UTRWD/Dallas agreement and the UTRWD staff presented this agreement to their Board of Directors on their November 9th meeting where it was subsequently approved. The agreement offers a compromise solution that supports UTRWD's desires to obtain a wastewater reuse permit for imported Lake Chapman water supplies while protecting Denton and Dallas's existing water supplies in Lake Lewisville. Staff provided a briefing to the PUB on the status of these negotiations at the December 9th, 2002 meeting. At this meeting, staff recommended the following course of action: Maintain the status our protest of the filed UTRWD reuse permit request up until the time it is amended by the UTRWD or TCEQ/TNRCC to comply with the terms and conditions outlined in the proposed Dallas/UTRWD contract agreement. This would include the final review of the accounting plan. Allow the Dallas/UTRWD contract agreement process to continue and introduce a simple amendment to the 1998 Denton/UTRWD pass through agreement to legally hold UTRWD accountable to the accounting terms and conditions outlined in the Dallas/UTRWD contract. The UTRWD then worked with the City of Dallas and City of DeNon develop, review and approve the accounting plan to monitor and report UTRWD's water imports and reuse volumes consistent with the terms and conditions outlined in the Dallas/UTRWD contract agreement. Once all parties had agreed to the accounting plan, the Dallas staff forwarded the Dallas/UTRWD agreemem to their City Council. The Dallas City Council subsequemly approved this agreemem on May 14, 2003 (Exhibit iii). Denton staff developed a simple amendment to the 1998 Denton/UTRWD pass through agreement and presented this to the PUB. The contract amendment was approved by the PUB on May 5, 2003 (attached meeting minutes - Exhibit iV). This comract amendmem was later presented to the UTRWD Board of Directors and was approved on June 5, 2003. Exhibit V represents the final contract amendment or addendum being proposed by Denton's staff. Thought this effort, the City of Denton will be able to accomplish their goals of protecting Denton's water rights from a possible encroachment by the originally proposed UTRWD reuse permit application while supporting the UTRWD's efforts to obtain a reuse permit with Denton's support. OPTIONS: 1. Approve the comract amendmem as recommended by the PUB and as approved by the UTRWD Board of Directors. 2. Modify the contract and request the UTRWD Board to approve the modify contract amendment. RECOMMENDATIONS: Staff recommends approval of the contract amendment as recommended by the PUB and as approved by the UTRWD Board of Directors. ESTIMATED SCHEDULE OF PROJECT: The UTRWD will submit a revised reuse permit to the TCEQ shortly after the City of DeNon and the City of Lewisville approve the amendmem to the 1998 "Pass Through" agreemem. Staff will notify the TCEQ that their protest of the permit request has been resolved, pending a proper review of the revised permit request. PRIOR ACTION/REVIEW (COUNCIL, BOARDS, COMM.) City of DeNon PUB Briefing - December 9, 2002. City of DeNon PUB approval of amendmem to 1998 Denton/UTRWD "Pass Through" Agreement - May 5, 2003. City of Dallas CC approval of Dallas/UTRWD Comract Agreemem - May 14, 2003. UTRWD Board of Directors approval of amendment to 1998 Denton/UTRWD "Pass Through" Agreement - June 5, 2003. FISCAL INFORMATION: Under the existing 1998 Demon/UTRWD "Pass Through" agreement, the UTRWD pays the City of DeNon a pass through charge of $ 0.02 per thousand gallons of water. This $ 0.02 per thousand gallons applies to both the first time pass through of UTRWD's Lake Chapman water supplies that pass through Lake Lewisville as well as the one time pass through of UTRWD wastewater return flows that are allowed under the accounting plan for the UTRWD reuse permit. Denton charges the UTRWD approximately $ 0.33 per thousand gallons for any UTRWD water use from Lake Lewisville that is purchased from Denton under the Interim Sale of Wholesale Raw Water Contract that was approved in 1994. Water supplies from Lake Chapman that are imported by the UTRWD and any wastewater reuse attributed to these imported water supplies would result in a decreased sales revenue to Denton. This anticipated revenue reduction has been anticipated by Denton staff for several years and has been reflected in the Water Utilities pro forma since 1999 and is included in the proposed FY 2004 Water Budget. Exhibit i: Exhibit ii: Exhibit iii: Exhibit iV: Exhibit V: Exhibit VI: August 30, 2002 Water Rights Permit Application # 5778 September 30, 2002 Protest Letter from Denton Dallas / UTRWD Lake Chapman Pass Through Agreement May 5, 2003 Pubic Utilities Board Meeting Minutes. Denton / UTRWD Addendum to Lake Chapman Pass Through Agreement Ordinance Respectfully submitted: Howard Martin Assistant City Manager, Utilities Prepared by: Tim Fisher, P.E., Assistant Director of Water Utilities TEXAS NATURAL RESOURCE CONSERVATION COMMISSION NOTICE'OF WATER RIGHTS APPLICATION APPLICATION NO. 5778 'Summary. The .uPper Trinity Regional Water District CLITRWD) has"applied for'a Water Use Permit to re-use'.~ffiuent generated through discharge of developed water purchased.fr0m' the City of Commerce out of Lake Chapman in the Sulphur River Basin, which .reuse will. be ~g'ithin its service area in the Trinity River Basin.· After initial use of the Lake Chapman water, it will be :-di~harged inl0'Lake Lewisvil-le ~)r tributaries-of the.:~akeand, to be~re-captured~m~heL~Lake for subsequent re-use. More information on the_ application and how to participate in the'permitfing process is given below. Application. The Upper Trinity Regional Water District, P.O. Box 305, Lewisville/Texas, 75067, applibant, seeks a Water Use Permit pursuant.to §§ 11.042, 11.046 and 11.121,~Tex, as.Water COde, and Texas Natural Resource Conservation Commission Rules 30 TAC' §295.1; et .~eq.. Notice is · being mailed to the water right 'owners 6frecord with diversion points between' the'discharge pOint 0fthe Lake Chapman water into the Trinity River Basin and the diversion point on Lake Lewisville, pursuant to 30TAC §295.153,-allowing for athirty (30)day comment period., i Pursuant to'a ·contract with the City of Commerce, the 'Upper Trinity Regional Water· District acquired the right to transport and use up to 16,106 acre-feet of water per annum for municipal and industrial purposes from Lake Chapman in the Sulphur River Basin. This water is specifically authorized to 'the 'City of Commerce in Certificate of Adjudication No. 03-4797;'as amended. Interbasin transfer authorization, to the Trinity Ri'ver Basin for 16,106 acre-feet of Watei: per annum for municipal and indUstrial use is authorized by-Certificate of Adjudication NO. 03,4797, as amended. " "' · ~-'Tli~lO~i~/~-Trinity Regi6nal w~ter Di-stric[~:p-uir-~anf~to-a pass through: agreement,wi, th.the~.Cities of Denton and Lewisville, seeks to use and reuse Lake Chapman (Lake Cooper) developed'Wat6r from lhe Sulphur River Basin, and purchased from the City of Commerce; by conveying the effluent from various wastewater treatment plants (WWTPs) receiving water that originates in Lake Chapman, 'and which plants are operated or used by the 'applicant Or its ·customers that discharge, int0.dther · Lake Lewisville or tributaries 0fLake Lewisville inclUding the following:: .. "' '1. 2. 3. 4. '5. 6. 7. The Celina WWTP on an unnamed tributary of Little'Elm Creek' The Lakeview Regional WWTP on Lewisville Lake; The Doe Branch (Eastside)WWTP on Doe Branch; The Riverbend WWTP on Little Elm creek; The Peninsula' WWTP on Cantrell Slough; The Krum WWTP on North Hickory Creek; and The Sanger WWTP. on Ranger Branch. Subsequent diversion of the wastewa, ter for reuse wil! Occur at uTRWD' s Lake Lewisville diversiOn · facilities. The effluent discharge from the City of Lewisville WWTP on Prfiirie Ckeek, tributary of the Elm Fork Trinity River,' downstream of Lake Lewisville is Proposed be re-.direCted by pipeline to Lake Lewisville for diversion and reuse within the UTRWD's service area. Applicant also seeks to use the bed and banks of the various tributaries of_Lake Lewisville downstream of the, wWTPs and upstream of Lake Lewisville to convey the developed water from the WWTPs to UTRW'D's existing and proposed future diversion facilities on Lake Lewisville. The average diversion rate of the reuse water to be .authorized for diversion from the perimeter of Lake Lewisville will increase over time to an average of 14.4 million-gallons-per-daY (MGD) with a peak daily rate o_fnot more than 43.2 MGD. , _. Applicant states that UTRWD's actual consumptive use o fLake Chapman water, including its reuse of Lake Chapman water shall not exceed 90 % of the actual total volume of Lake Chapman water that the UTRWD imports each year into the Trinity River Basin. The UTRWD's reuse of Lake Chapman water will not include water derived from other sources, and any Lake Chapman water returned to Lake Lewisvil!e and not consumptively used wi!1 be available for use by other water right 'holders on the lak6.' .~ : Applicant indicates it will use actual discharge measurements and a daily accounting model to track water involved in the reuse project which will be available for reuse· from Lake Lewisville. Applicant states that there will be no impact on instream uses and bay and esfuary freshwater inflow needs of the Trinity River Basin because the water UTRWD proposes to reuse is water transferred from Lake Chapman in the Sulphur River Basin to the Trinity River Basin as '~developed water" and represents a water supply not appropriate to meet such needs. The application was received on August 2, 2001, and 'additional information in support of the application was received on February 1, 2002, February 15, 2002, May 3, 2002, and May 22, 2002. The application was declared administrativ, ely complete on May 28, 2002. PUBLIC COMMENT / PUBLIC MEETING. Written public Comments and requests for apubiic meeting·should be submitted to the Office of Chief Clerk, at the address provided in the information section below, within 30 days of the date of this notice. 'A public meeting is intended for the taking of public comment, and is not a contested case hearing. A public meeting will be held if the Executive Director determines that there is a significant degree of public interest in the applleation. CONTESTED CASE HEARING. The TNRCC may grant a contested case hearing on this application if a written hearing request is filed within 30 days from the date of this notice. The Executive Director may approve the application unless a written request for a contested case hearing is filed within 30 days of this notice. To request a contested case hearing, you must submit the following: (1) your name (or.for a group'- or. association, an official representative)~ mailing address, daytime phone number,:and fax number, . . if any; (2) appliCant'S~name and perrnit-r~umber;' (3)' the~statement "II/we] request'a ~ontested case hearing;" (4) a brief and specific' description of how you would be affected by the application in a .way not common'to the general public; and (5) the location and distance ofyo~ proPerty rela~tive to the ~roposed activity. You may also submit pr0p0hed c°nd!tions 'in'the'~reqUestedpermit which would satisfy your concerns. Requests for a contested case heatingmust be submitted inwriting to the Office of the Chief Clerk at the address provided in the information section below. If a hearingre~ ,u~est is filed, the Executive Director will not issue the permit and will forWard the application and hearing request to the TNRCC Commissioners for their consideration at a scheduled Commission meeting. ' INPORMATION. ~fit~en~he~a~g re~-~i~t~'p~l~lic'~'0~n~ o~ r~eqUeS~ ~'o~pii~i~-h~eeting should be subn/il-ted to the Office of the Chief Clerk, MC 105, TN'RCC, P.O. Box 13087;,Afistin, TX 78711-3087. For information concerning the hearingprocess, please contact the Public Interest Counsel, MC 103, the same address. For additional information, individual members of the general public may contact the Office of Public Assistance at 1-800-687-4040. Gerieral information regarding the TNRCC can be found at our web site at www.tnrcc.state.tx.us. ' :' "Issued:AugUst 30, 2002' - ....... ' :. .....' ". i :' '.'~'~. · ~- '...~ :' MICHAEL J. BOOTH CAROLYN AHRENS' FRED B. WERKENTHIN, JR; RO~S RICHARD-CROW LAW OFFICES OF' BOOTH, AHRENS & WERKENTHIN, P.C. A PROFE~SIONAL CORPORATION 515 CONGRESS AVENUE, SUITE 1515 AUSTIN, TEXAS 78701-3503 512 / 472-3263 ,,, FAX 512 / 473-2609 September 30, 2002 Via Hand Delive~ LaDonna Castanuela Chief Clerk TCEQ - MC 105 P.O. Box 13087 Austin, Texas 78711-3087 RE: Application No. 5778 ;' ~ ~ J Hearhg Request of City of Denton regar~ng App~cation No. 5778~f the Upper Trinity Re~onal Water District Dear Ms. Castanuela: The City of Denton ("Denton") requests contested case hearings on the above-referenced applications of the Upper Trinity Regional Water District ("UTRWD"). Protestant Information: City of Denton 215 East McKirmey Denton, Texas 76201 c/o Carolyn Ahrens Booth, Ahrens & Werkenthin, P.C. 515 Congress Avenue, Suite 1515 Austin, Texas 78701 (512) 472-3263 (512) 473-2609 (fax) carolyn @baw.com Applicant Information: Upper Trinity Regional Water District P.O. Box 305 Lewisville, Texas 75067 EXHIBIT II Chief Clerk September 30, 2002 Page 2 Denton's Standing to Protest: Denton would be adversely affected by the granting of the UTRWD application in various ways not common to the general public. Denton is an affected person with personal justiciable interests in the matters put at issue by the above-referenced application and has standing to request contested case hearing as contemplated in the Texas Water Code and the rules of the Texas Commission on Environmental Quality. Denton also has the interests, authorities, and responsibilities for water supply that are contemplated of governmental entities for purposes of standing under the code and rules. Denton believes that granting UTRWD's application may impact Denton's water rights. Certificate of Adjudication No. 08-2348 authorizes Denton to store 68,424 acre-feet of water in Lake Lewisville, Trinity River Basin, and to divert and use therefrom not to exceed 58,424 acre-feet of water per annum for municipal and domestic purposes at various priority dates. Certificate of Adjudication No. 08-2335, as mended, authorizes Denton to store 207,896 acre-feet in Lake Ray Roberts, and to divert and use therefrom not to exceed 207,896 acre-feet per annum for municipal and domestic use and to use the bed and banks of Elm Fork to transport water from Lake Ray Roberts downstream to Lake Lewisville. Notice of UTRWD's application references a "pass-through agreement" with Denton. That agreement for the pass-through of Chapman Lake water through Lake Lewisville placed certain contractual limitations on UTRWD's use of the lake, including that pass-through would be limited strictly to water amounts attributable solely to Lake Chapman water, that UTRWD would avoid any impact on Denton's water in Lake Lewisville, and that UTRWD would not use, reduce, or impair Denton's storage space in Lake Lewisville. UTRWD also committed to get Denton's approval of UTRWD's "proposed reuse strategy" prior to making application for reuse. UTRWD proposed a reuse "strategy" to Denton based upon accounting methods that were unacceptable to Denton and did not receive this approval prior to filing its application (see attached letters dated April 9, 2001; October 1, 2001; and May 28, 2002). The UTRWD's reuse permit application notice identifies a reuse amount of 14.4 million- gallons-per-day (MGD) with a peak daily rate of not more than 43.2 MGD. The notice further states that the UTRWD's actual consumptive use of Lake Chapman water, including its reuse of Lake Chapman water shall not exceed 90% of the actual total volume of Lake Chapman water that UTRWD imports each year into the Trinity River Basin. This proposal appears to be consistent with earlier UTRWD "proposed reuse strategies" that were rejected by Denton since they exceeded the limits of "full reuse" and represented an encroachment upon the water fights held by Denton in Lake Lewisville. There also appear to be other variances between the agreement and the application fried by UTRWD. The agreement between Denton and UTRWD is a matter of record with the Commission. UTRWD has applied for the right to reuse water discharged to Lake Lewisville. It appears that UTRWD may be proposing to designate amounts of return flow that have been historically discharged within the Trinity River Basin as amounts now to be allocated as Lake Chapman water. Although the discharge of return flows from Lake Chapman water may be new to the basin, discharges from UTRWD customers are not new. To the extent that UTRWD' s proposal includes a substitution of supplies, or includes reuse of inflow and infiltration water historically available to the system, UTR~q)'s proposed reuse is in excess of full use of Lake Chapman return flows and may impair Denton's water rights. Denton also believes that the calculation of return-flow factors and accounting for Lake Chapman water proposed to be reused may not adequately ensure that UTRWD is not using or affecting Denton's storage rights in Lake Lewisville. In this regard, Chief Clerk September 30, 2002 Page 3 Denton additionally believes that UTRWD has failed to comply with the intent, if not the letter, of TCEQ mles for prior approval of storing water in a reservoir owned by another. The UTRWD application also states that the Lake Chapman reuse will come from effluent conveyed from "various wastewater treatment plants (WWTPs) that are operated or used by the applicant or its customers that discharge into Lake Lewisville or tributaries of Lake Lewisville" and list seven different WWTPs. Of these, three (Doe Branch, Riverbend and Peninsula) are UTRWD facilities in the design or permitting stage but are currently not operational; three (Sanger, Krum and Celina) are owned and operated by existing or proposed future UTRWD water customers that currently depend heavily or exclusively upon ground water supply sources; and the Lakeview Regional WWTP operated by the UTRWD has historically received water supplies purchased from the Cities of Denton and/or Dallas that were from water rights held in the Trinity River basin. Furthermore, the City of Krum has recently entered into a contract agreement with the City of Denton to treat its wastewater. Location and Distance of Water Rights from the Prot)osed Activity: UTRWD's application locates the proposed activity, in part, on Lake Lewisville. As noted above, Denton holds water rights in Lake Lewisville, itself. Conditions in Prol~osed Permit which may Satisfy_ Protestant's Concerns: The law, rules and policy of the Texas Commission on Environmental Quality that will be applied to UTRWD's application are unclear at this time, and no draft permit has yet been prepared. The Commission's staff has not yet completed technical review of UTRWD's applications, and it is impossible to determine at this early stage in the proceedings all of the possible impacts that granting UTRWD's application may have on Denton's water rights and the quality of water available for diversion and use by Denton. However, if UTRWD satisfies Denton that the use proposed is not in excess of amount strictly attributable to new water from Lake Chapman, does not impact Denton's water in Lake Lewisville, and does not use, reduce, or impair Denton's storage rights in Lake Lewisville, then Denton anticipates that it would withdraw its protest. Denton may propose permit conditions that would reflect these assurances at a later time. Conclusion: In consideration of the matters outlined above, City of Denton asks that this request be processed expeditiously and that the Commission convene a contested case hearing regarding the above-referenced application of UTRWD. Very truly yours, Carolyn Ahrens CA/klr Enclosures Tim Fisher (w/o enclosures) Howard Martin (w/o enclosures) Jim Coulter (w/o enclosures) Michael Copeland (w/o enclosures) 215 E. McKINNEY DENTON', TX 76201 · (gd0) 349-g230 · FAX (940) 349-812( ........ c~mrrv'.~uMi~is¥/~:no~ April 9, 2001 Mr. Thomas E. Taylor Executive Director Upper Trinity Regional Water District P.O. Drawer 305 Lewisville, Texas 75067 Su~,jeet: Review of UTRWD's Chapman Lake Water Reuse Program Concept Dear Mr. Taylor: This letter will serve as a resporme to your draft "Chapman Lake Water 1reuse Program Concept" prepared by Alan Plunun~r Associates, dated January 2001. I appreciate your cooperation and patience in giving the City of Denton's staff ample opportunity to review this proposal. It was extremely important for our staff to provide meaningful thought and careful consideration on both the short term and long tom implications that this proposal may have on Denton's existing water rights in Lake Lewisville, Denton's contractual relations with the City of Dallas, and the water quality issues related to this reuse From the beginning of our contract negotiations with the UTRWD for the Lake L~wisville pass through agreement, the City of Denton had communicated two basic principles concerning UTRWD's interest in obtaining water reuse of imported Lake Chapman water supplies. These principles were: The City of Denton supported the basic principle of UTRWD reuse of imported water supplies that originated from existing UTRWD contracts for water in Lake Chapman. We expressed concerns that any water reuse program proposed by the UTRWD should not negatively impact existing water rights interests held by the City of Denton or any contractual relationships with our water supply partner, Dallas Water Utilities. 4 "Dedicated to Quality Service" www. cityqfdenton, eom As we had previously discussed with your engineering consultant, the City of Denton had decided to retained outside legal counsel to provide input concerning possible conflicts with Denton's water fights interests and existing or proposed reuse strategy_ It was also necessary to coordinate our review with the city of Dallas, our water rights and reservoir partners on Lake Lewisville and Lake Ray Roberts. We have also recently received a copy ora letter dated February 26, 2001 (attached) supplied to you from the City of Dallas that describes their issues and concerns with the Lake Chapman Water Reuse Program Concept. The key issues of concern that they have voiced continue to be the same issues of concern that the City of Denton has previously raised in discussions with you and your consultant. These are: · We cannot support thc multiple pass reuse concept. · We have concerns about the "assignment" of Chapman water to UTRWD customers. We have also prepared a list of concerns that were raised by our outside counsel and our staff that specifically relate to our concerns with the multiple pass reuse concept and the "assignment" of Chapman water to UTRWD customers. Since many of these issues were raised by our outside counsel, it would be appropriate to arrange a meeting to discuss how they should be addressed and why they support Denton's position on the two points listed above. We look forward to discussing these items at your earliest convenience. Sincerely, Tim Fisher, P.E. Assistant Director of Water Utilities Denton Municipal Utilities. CC: Blake English, Howard Martin, Jim Coulter Attachment: February 26, 2001 letter from Dallas Water Utilities 5 "Dedicated to Quality Service" www. cityofdenton, com 215 E. McKinney Street nton, Ter~ 76201 (940) M9-$306 FAX (940) 349-8596 OFFICE OF TIlE CITY MANAGER October l, 2001 Mr. Thomas E. Taylor Executive Director Upper Trinity Regional Water Disuict P.O. Drawer 305 Lewisville, Texas 75067 Subject: Review of UTRWD's Proposed SUmegy for Reuse of Chapman Lake Water. Dear Tom: Thank you for your letter dated July 25, 2001 (attached), regarding the proposed strategy for reuse of Chap~r~ Lake water. I particularly appreciate your input and guidance on the historical perspective of this proposal as well as your patience as I was educated on this issue. Let me say first that the City of Denton supports the Upper Trinity River Water District's (DistriCt) de,ire to obtain a reuse permit for return flows from Lake Chapman water supplies in accordance with the existing Lake 'Lewisville "Pass-Through" Agreement. Because the Cities of Denton and Dallas retain the water rights in Lake Lewisville, any water fights permit or reuse proposal that affect~ water withdrawals from Lake Lewisville is of extreme importance to both entities. As you know especially' well the Cities of Denton and Dallas share a long history of cooperation and coordination in maua~ng water supplies in both Lake Lewisville and Lake Ray Roberts as both Cities committed considerable financial investments to provide this water to out customers. After carefully reviewing your letter,, it appears that the proposed reuse strategy you requested is inconsistent with the recommendations offered by my Water Utility department staff. (See attached letter dated April 9, 2001.) The proposed reuse ~tmtegy outlined in' your letter seemingly represent$ an encroachment into the water supplies available to the City of Denton under current water fights permits we hold. My staff also tells me the issues raised by them are similar to those raised by Dallas Water Utilities (see attached letter dated February 26, 2001). Tom, we have also heard from the TNRCC staff that Denton was in support of this reuse proposal. Our folks indicated to them that several issues need to be resolved before the City Of Denton could support the proposal. zto/~oo~ EXHIBIT Il s~I~I~IJ~l Letter to Thomas Taylor October 1, 2001 Page 2 of 2 Again, I may not have a full grasp of these issues, and would be happy to' facilitate a meeting at your convenience. If the proposal remains as it was submitted to the TNRCC on August 2, 2001, the City of Denton will have no choice but to protest the proposal. Finally, let me once more tell you that it was a pleasure to meet you recently. I very much enjoyed our time together. Michael A. Conduff City Manger MAC:al zTo/eoo~ 7 g~I,l'.r'II~[1 215 F.. McXm~Y DENTON, TX 76201 · (940) 349..8306 · FAX (94~ 349-8596 OI~I~CE OF THE CITY MANAGER May 28, 2OO2 Mr. Thomas E, Taylor ~ve DirccU~ Upper Trinity l~ional W~c~ District P.O. Dra,,wr 305 Lewism31e, Texas Subj~u. Th/s lem~/s h resp(mse to your Aim3 23, 2002 you ~1 ~ ~ of~ ~~ ~~~ in nature to the concerto ~ ~ ~ bY Dream's Water Utility ataff~ It aplgam this comm,,,,;~cl to you in tim past, both vedmlly and in wrRin& Thc~ ismms are:. ws~.~'~fdmmn, eom ~ to Thomas Taylor 28, 2~2 Page2 2. Thc "multiple cycle canccl~/or reuse that suggests discha~cs should be credited bcyand, fl~ adml a.ily dlscherg~ into Leke Lewisville. both Denton ~ Dallss egr~ oa thc dem-'ls and tho assumptions used. In meetinga et ~a_,~c. Specific mention was mad~ about waeacwa~ zcuec for nddress the key ~ obje~ons that we bavehnd with your CUrlier ptopenls, Wc Imve also d~-uss~ thnt ~ may nce~ to be nthn~ way ~ntn~ ~bnt b~'_~_~ ~ City of Denton o~ a scpm'ate contract amendment to our ~g Lake Lewisviile imss-~ I Would ~~ encourage you ~, ecriously consider this pmpoe~ c, mtract aa a pathway to rmolving the diff~ thnt we have had with your earlier ptoposa~ We would be willhg to host any mectings vdt~ you and the City Of I:hdlas Water Ut~ties stat~ m go "D~'c~t~ to ~di~ ~,ice' .dm, w.c~dmton, com 9 L~t~er to Thonms Taylor M~y 28, 2OO2 Pag~ 3 cit~ lVfr. Ricbmd Lubk~ Pr~idmt, UT~WD Board of Directo~ Mr. Terrm:e Stewart, ~ of I~_fl~ Warn: Utilities Mr. Tmi Cmmnd, Wa~r ~ Permitliug Team L~ad~, TNRCC ' Mmtin Rochel~ Lloyd, C_~__~li~r, Blev~t, Rodm~e, et aL "~ed ~o ~2ual~ v.,ww, ci~d~on, eom CO Y AGREEMENT BETWEEN CITY OF DALLAS AND UPPER TRINITY REGIONAL WATER DISTRICT REGARDING USE OF LAKE LEWISVILLE FOR PASS THROUGH OF CHAPMAN LAKE WATER STATE OF TEXAS COUNTY OF DALLAS KNOW ALL MEN BY THESE PRESENTS: This agreement (tho"Agreement"), is made and entered into as of this /¢',~ day of ,200~, ("the Effective Date") by and between the City of Dallas ("Dallas"), a home-rute municipality in Texas, and Upper Trinity Regional Water District ("the District"), a political subdivision of the State of Texas, created and operating under the provisions of Article XVl, Section 59 of the Texas Constitution. RECITALS The purpose of this Agreement between Dallas and the District is to set forth their mutual agreements regarding up to 27,306 acre-feet of water the District will import from Chapman Lake in the Sulphur River Basin pursuant to Commission authorizations and this Agreement (including 16,106 acre-feet of the District's water, and any additional water not to exceed a total of 11,200 acre-feet per annum (10 million gallons per day."10 mgd") which the District may purchase and which originates in Chapman Lake before such water is discharged into Doe Branch and then into Lake Lewisville, to provide a program for the District's pass through of said water and up to 16,383 acre-feet of associated return flows through Lake Lewisville in the Trinity River Basin which avoids any impact on senior water rights in Lake LewisvilIe owned by Dallas and Denton, and to adopt a methodology for the contemporaneous and accurate diversion, use and accounting for Chapman Lake Water and Chapman Water Return Flows in Lake Lewisville. This agreement is subject to the issuance of a reuse permit by the Commission pursuant to the District's pending Application No. 5778, or a similar application. STATEMENT OF AGREEMENT For and in consideration of the foregoing premises and the mutual promises, undertakings, obligations and benefits set forth herein, Dallas and the District contract and agree as follows: Dallas/Upper Trinity R.W.D. Chapman Lake Water EXHIBIT III Page 1 of 30 ARTICLE ONE DEFINITIONS, INTERPRETATIONS AND AUTHORITY 1.1 Definitions. Unless the context requires otherwise, the terms and phrases used in this Agreement shall have the meanings specified as follows: (a) Accountin.q System. The system, as detaiIed in this Agreement, for accounting, monitoring and reporting: o 10. The discharge of Chapman Lake Water from the Sulphur River Basin to Doe Branch in the Trinity River Basin; The Doe Branch Conveyance Losses of the Chapman Lake Water; The amount of Chapman Lake Water not conveyed through Lake Lewisville by being diverted directly to the District's water treatment plant; The amounts of Chapman Lake Water lost to Consumptive Losses, including piping and pumping, water treatment plant losses; The amounts of Treated Chapman Lake Water sold to customers of the District inside and outside the Lake Lewisville Watershed; The amounts of Treated Chapman Lake Water sold to customers of the District on septic tanks in the Lake Lewisville Watershed; The amounts of Chapman Water Return Flows discharged from a wastewater treatment plant of the District or one of its customers, which amounts flow into Lake Lewisville; The amounts of treated effluent from Chapman Lake Water lost to Channel Losses; The amounts of Treated Chapman Lake Water used by the District or one of its customers in Direct and Indirect Reuse projects; and The amounts of Chapman Water Return Flows diverted and used by the District. (b) A.qreement. This Agreement between City of Daltas and Upper Trinity Regional Water District. Dallas/Upper Trinity R. W, D. Chapman Lake Water Page 2 of 30 (c) Available Chapman Lake Reuse Water. The District's Chapman Water Return Flows as described in Section 1.1 (f), below, minus Channel Losses, and adjusted for losses related to. Direct Reuse and Indirect Reuse. (d) Channel Losses. Chapman water Return Flows lost between the discharge point for any wastewater treatment plants of the District or one of its customers discharging into the Lake Lewisvifle Watershed and the water surface of Lake Lewisville. (e) Chapman Lake Water. Up to 16,106 acre-feet per year of water diverted by the District from Chapman Lake in the Sulphur River Basin to the Trinity River Basin, either to Lake Lewisville or directly to a District water treatment plant for use by the District's customers for domestic, municipal or industrial purposes in compliance with ali necessary authorizations of the Commission. Chapman Lake Water may also include up to an additional 10.0 mgd of water from Chapman Lake (an annual amount of up to 11,200 acre- feet), when such water is purchased by the District, and the purchases are made ahead of the discharge of the purchased Chapman Lake Water into Doe Branch or the direct diversion of the purchased water to a water treatment plant of the District or one of its customers. Chapman Lake Water does not include any water which does not originate from Chapman Lake. (f) Chapman Water Return Flows. Not to exceed 16,383 acre-feet of water per annum composed of daily amounts of treated wastewater effluent discharges from a wastewater treatment plant of the District or one of its customers authorized by the Commission to discharge into the Lake Lewisville Watershed, which water originated from Chapman Lake Water as herein defined. Chapman Water Return Flows are the amount of water resulting from the diversion or use of Chapman Lake Water and the treatment, use, subsequent wastewater treatment and discharge as effluent of the Chapman Lake Water. The District is authorized to divert and use the full amount of the treated effluent attributable to the District's diversion or use of Chapman Lake Water, except that the District's diversion and use of Chapman Water Return Flows shall not exceed sixty percent (60%) of Treated Chapman Lake Waterl as provided by this Agreement. Dallas/Upper Trinity R. W. D. Chapman Lake Water Pa9e 3 of 30 (g) Commission. The Texas Commission on Environmental Quality, or any successor agency acquiring the regulatory authority of the Commission. (h) Consumptive Losses. That portion of the District's Treated Chapman Lake Water which does not become a part of Chapman Water Return Flows due to consumption, and other losses occurring throughout the District's System. (i) Conveyance Losses. Chapman Lake Water lost by the District in transportation of the water from one location to another, including water treatment plant losses, piping and pumping losses, and water losses in Doe Branch from point of discharge to the water surface of Lake Lewisville. (j) Daltas. The City of Dallas, Texas. (k) Denton. The City of Denton, Texas. (I) Denton Aqreement. The AuguSt 24, 1998 agreement entitled, "Upper Trinity Regional Water District Agreement with the City of Denton and City of Lewisville Concerning Water from Cooper (Chapman) Lake." (m) Direct Reuse. The use of that portion of Treated Chapman Lake Water which remains unconsumed after the water is used for the original authorized purpose and before that water is disposed of or discharged or otherwise allowed to flow into a watercourse or any body of State water. (n) District. The Upper Trinity Regional Water District. (o) District's System. The transmission, distribution and treatment facilities for water and wastewater owned by the District, including wastewater treatment plants of District customers which discharge treated effluent originating from Chapman Lake Water into the Lake Lewisvilie Watershed. Dallas/Upper Trinity R. W. D, Chapman Lake Water Page 4 of :30 (p) Evaporation Losses. Chapman Lake Water and Chapman Water Return Flows lost by the District as a result of evaporation of the water during its Pass Through of Lake Lewisvitle. (q) Indirect Reuse. That portion of Treated Chapman Lake Water which is discharged from a wastewater treatment plant and allowed to flow into a watercourse or any body of State water, and subsequently diverted and used before that water flows into Lake Lewisville. (r) Irving. The City of Irving, Texas. (s) Lake Lewisville. The Corps of Engineers reservoir on the Elm Fork of the Trinity River. in which storage is authorized by Dallas in Certificate of Adjudication No. 08- 2456, as amended. Lake Lewisville does not include Lake Ray Roberts, authorized by Certificate of Adjudication No. 08- 2455. (t). Lake Lewisville Watershed. Any land upstream of Lake Lewisville, from which both point and non-point source discharges enter Lake Lewisvil[e. The Lake Lewisville Watershed does not include the Lake Ray Roberts watershed. (u) One-Time Pass Throuqh. The District is limited to a one-time use of Chapman Lake Water from Lake Lewisville, not to exceed 27,306 acre-feet per annum of Chapman Lake Water on the day such water is transferred into the Trinity River Basin from Lake Chapman, and the use on the subsequent day of not to exceed 16,383 acre-feet per annum of Chapman Water Return Flows, both calculated in accordance with the Accounting System of this Agreement. (v) Parties. The City of Dallas, Texas and the Upper Trinity Regional Water District. (w) Party. The City of Dallas, Texas or the Upper Trinity Regional Water District. (x) Pass Throu.qh(s). The temporary use of Lake Lewisvifle for conveying daily discharges of the District's Chapman Lake Water or Chapman Water Return Flows for daily Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 5 of 30 use. The term "Pass Through" does not equate to storage, and the right to pass Chapman Lake Water or Chapman Water Return Flows through Lake Lewisville does not include the right to store water in Lake Lewisville for the District's use. (y) Return Flow Factor. The daily, monthly, or annual factor developed by the District, in cooperation with Dallas and Denton and pursuant to this Agreement, which accurately reflects the percentage of Treated Chapman Lake Water discharged daily from the District's and the District's customers' wastewater treatment plants after daily subtractions of: Consumptive Losses; Channel Losses, losses from customers not connected to a sanitary sewer system, and after consideration of Direct Reuse and Indirect Reuse. (z) Surplus Water. A daily amount of water available for sale by Dallas or Denton to the District when Lake Lewisville is full and spilling, the U. S. Army Corps of Engineers is releasing amounts in excess of Dallas' and Denton's daily requirements, and Dallas approves the sale. (aa) Treated Chapman Lake Water. The volume of water which is the source of the Chapman Water Return Flows, which amount is equal to the amount of Chapman Lake Water available to be pumped from the District's water treatment plants to the District's customers for domestic, municipal, and industrial use after consideration of all raw water and treatment plant losses. 1.2. Inte.rpretafions. The titles and headings of the articles and sections of this Agreement have been inserted for convenience and reference only and shall not in any way modify or restrict any of the terms and provisions of this Agreement. 1.3. Authority. The parties have the authority to enter into this Agreement, which is an interlocal contract under Chapter 791 of the Texas Government Code. As a home rule municipality, Dallas has the authority to enter into this Agreement under Texas law. The District has authority to enter into this Agreement and to perform its obligations under this Agreement under Chapters 49 and 51 of the TEXAS WATER CODE. The Parties acknowledge that the mutual promises, undertakings, obligations and benefits of this Agreement are intended to comply with ail Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 6 of 30 laws applicable to home rule municipalities and regional water districts, and that this Agreement is subject to the law of the State of Texas. ARTICLE TWO USE OF LAKE LEWISVILLE IN THE TRINITY RIVER BASIN FOR PASS THROUGH OF CHAPMAN LAKE WATER FROM THE SULPHUR RIVER BASIN 2.1. Authorizations Required. The District may use Lake Lewisville for a One-Time Pass Through of Chapman Lake Water and the resulting Chapman Water Return Flows subject to the continuing validity of the fo[lowing: (a) The permit granted by the Commission pursuant to the District's pending Application No. 5778; (b) The previously authorized interbasin transfer of 16,106 acre-feet of water from Chapman Lake in the Sulphur River Basin to Lake Lewisville in the Trinity River Basin by the District; (C) District's agreement with the City of Denton, dated August 24, 1998, entitled, "Upper Trinity Regional Water District Agreement with the City of Denton and City of Lewisvi[le Concerning Water from Cooper (Chapman) Lake," attached hereto as Exhibit "A;" and (d) This Agreement. 2.2. lnterbasin Transfer of Chapman Lake Water to Lake Lewisville. Water a'uthorized to be appropriated by the District will be diverted from Chapman Lake, conveyed by pipeline to Doe Branch, a tributary of Lake LewisvilIe, and discharged via Doe Branch into Lake Lewisville or transported directly to a District water treatment plant. 2.3. Limitation on District's Diversion and Use of Lake Lewisville for Pass Throuqh cf_ Chapman Lake Water. (a) Under this Agreement, the District may divert its Chapman Lake Water directly to its water treatment plant or from its diversion facilities authorized by the Commission Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 7 of 30 located on the perimeter of Lake Lewisvi]le in accordance with the terms and conditions of this Agreement. (b) The District is authorized to use Lake Lewisville to Pass Through up to 27,306 acre- feet per year of Chapman Lake Water and up to 16,383 acre-feet per year of chapman Water Return Flows from one use and treatment of the Chapman Lake Water, only as specified in this Agreement and its agreement with the City of Denton. No water other than Chapman Lake Water and Chapman Water Return Flows is authorized by this Agreement to be passed through Lake Lewisville by the District. (c) The District is authorized to use Lake Lewisville to Pass Through Chapman Lake Water and Chapman Water Return FIows one time and one time only as specified in this Agreement. No multiple Pass Throughs of Chapman Water Return Flows through Lake Lewisville are authorized by this Agreement. (d) This Agreement requires the District to account for all Chapman Lake Water in accordance with the Accounting System. ARTICLE THREE USE OF CHAPMAN LAKE WATER AND CHAPMAN WATER RETURN FLOWS BY 3.1, THE DISTRICT Measurement of Chapman Lake Water Upon tts Entry into Lake Lewisville. (a) Diversion of Chapman Lake Water into Lake Lewisville shall be metered and accounted for as prescribed by the contract between the District and the City of Irving, dated May 20, 1999, entitled "Contract for Transportation of Water from Chapman Lake," a copy cf which contract is attached hereto as Exhibit "B." (b) The amount of Chapman Lake Water entering Lake Lewisville will be determined by subtracting from the total metered amount of water discharged from the pipeline into Doe Branch any amount of water which is not part of the District's Chapman Lake Water, and the amount, if any, diverted after the meter directly to the District's water treatment Dallas/Upper Tdn[ty R. W. D. Chapman Lake Water Page 8 of 30 plant. The meter will be read daily and the daily amounts of the District's Chapman Lake Water will be provided to Dallas and Denton by the fifteenth (15~) of the fo[lowing month. 3.2 Meterinq Facilities, A.ccuracy and Billing Adius. tments (a) Metering stations for Chapman Lake Water shall be located at the District's point of discharge into Doe Branch, and any point of discharge of Treated Chapman Lake Water and Chapman Water Return Flows. (b) As between the Parties, the District shall be responsible for all costs associated with the design, construction and operation of all metering facilities and equipment required by this Agreement. All metering facilities and equipment shall be designed, constructed, operated and maintained in conformance with Dallas' requirements. For existing metering facilities, District shall be responsible for modifications, if any be required, to bring them up to Dallas requirements. Plans for new facilities shall be submitted to Dallas' Director of Water Utilities, or his designee, for review and approval prior to finalizing the design, All designs, materials and specifications shall conform to Dallas' requirements. Datlas shall have the right to make periodic inspections during the construction phase of the metering facilities. Final acceptance of the metering facilities is subject to review and written approval of Dallas' Director of Water Utilities, or his designee. Such review and written approval shall not be unreasonably withheld. (c) The District shall test and certify the accuracy of the metering facilities required by this Agreement at least annually. The District shall notify Dallas in advance of such test so that Dallas can observe it. The District shall subsequently provide the test results to Dallas. (d) It shall be the duty of either Party to this Agreement to notify the other Party in the event it becomes aware that any metering facility or equipment is registering inaccurately, performing improperly, or otherwise malfunctioning so that the meter can be promptly repaired. Each meter will be operated and maintained so as to record with commercial accuracy. The Party to this Agreement conducting a meter test shall notify the other party prior to any meter test or calibration so that the test can be observed by both Parties. Either Party has the right to request a meter to be tested with the other Party having the Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 9 of 30 right to witness such. if either Party requires a meter be tested more frequently than annually, that Party shall pay the cost of the test. However, if Dallas requires the test and the meter is found to be not within commercial accuracy, then the District shall pay the costs of the test. (e) The District shall monitor meter operations on a regular basis, and if a meter is discovered to be malfunctioning, appropriate Dallas staff shall be notified. If a meter is determined to be malfunctioning or out of service, the amount of water which has passed through such meter will be estimated using the last correctly measured period of consumption as a basis for computing the amount of water which should have been measured during the time the meter was not functioning correctly. The District shall maintain pumping logs, meter testing and calibration repods, and other records required by State or federal governments. Such records are Open Records and shall provide an alternate manner to estimate water that should have been metered during the meter malfunctions. 3.3. Accountinq for'Diversions and Use of Chapman Lake Water. The District shall monitor and record ail diversions and use of Chapman Lake Water and Chapman Water Return Flows by the District out of Lake Lewisville on a daily basis. Monthly reports of the daily information regarding the District's diversions and use of Chapman Lake Water shall be provided to Dallas and Denton by the 15th of the following month. 3.4. Allowance for Conveyance Losses. (a) The amount of Chapman Lake Water diverted into Lake Lewisville available for use by the District shall be reduced by daily calculation of Conveyance Losses to account for losses between the point of discharge into Doe Branch and the water surface of Lake LewisviIle. (b) Until modified as provided in Section 3.4(c) below, it is assumed that, the Chapman Lake Water discharged into Doe Branch will have, on average, Conveyance Losses equal to 0.3 percent per mile along Doe Branch to the water surface of Lake Lewisville. Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 10 of 30 (c) In accordance with the terms and conditions of the January 8, 1998 agreement between Dallas and Irving, entitled "Water Treatment Services Contradt,~ and' two explanatory letters from Dallas to Irving both dated March 21, 2002, the amount of Conveyance Losses in Doe Branch may be adjusted in the future, based on the results of a valid study of Doe Branch conveyance losses conducted by Dallas, the District, and Irving. A copy of the Water Treatment Services Contract and explanatory correspondence between Dallas and irving is attached hereto as Exhibit "C." (d) 'The amount of Chapman Lake Water lost to water treatment plant losses, piping, and pumping losses in the raw water system will be determined, to the extent possible, on the basis of an appropriate percentage of water meter readings at District's raw water intake structure and upstream and downstream of the water treatment plant of the District. Alternative methods to estimate losses are subject to approval, in advance, by Dallas and Denton. 3.5. Evaporation Losses. Evaporation Losses of Chapman Lake Water and Chapman Water Return Flows passed through Lake Lewisville by the District are expected to be de minimus and are offset by water not totally consumed by the District, which remains as inflow for Dallas and Denton. Dallas reserves the right to reconsider the treatment of evaporation losses in this Agreement, and to amend the Accounting System to consider Evaporation Losses at any time data or experience indicates that evaporation losses are determined to be significant to Daltas. Should Dallas make the determination that the evaporation losses are significant, the evaporation losses will be included in the Accounting System in the manner set forth in Exhibit "D." 3.6. Diversion of Chapman Lake Water. The amount of Chapman Lake Water discharged into Lake Lewisville available for diversion by the District shall be accounted for daily. The amount of Chapman Lake Water transferred by pipeline directly to a District water treatment plant shall be accounted for daily. 3.7. Use of Water when Lake Lewisville is Spilfing. The parties acknowledge that when Lake Lewisville is full and spilling, the District may either divert and use its Chapman Lake Water from Lake Lewisville under the terms of the Denton Agreement, purchase Surplus Water from Denton, or purchase Surplus Water from Dallas under the following circumstances: DaJlas/Upper Trinity R.W.D. Chapman Lake Water Page 11 of 30 (a) When Lake Lewisville is full and spiliing, and the U. S. Army Corps of Engineers is releasing amounts' greater than Dallas' daily requirements. (b) When the District purchases water under this Section 3.7 from either Dallas or Denton, the water so purchased shall not be considered to be Chapman Lake Water. (c) When the District purchases Surplus Water from Dallas under this Agreement, the rate paid by the District shall be the interruptible untreated water rate in effect at the time of usage, which is equal to the rate for same rate charged by Dallas to Irving under the January 8, 1998 Water Treatment Services Contract, and the March 21, 2002 explanatory correspondence between Dallas and Irving, attached hereto as Exhibit "C." ARTICLE FOUR USE OF CHAPMAN WATER RETURN FLOWS FROM LAKE LEWISVILLE 4.1. Diversion and Use of Chapman Water Return Flows. Chapman Lake Water used for domestic, municipal and industrial purposes by the District may be returned to Lake Lewisville after treatment at one of the District's or the District's customer's wastewater treatment plants authorized and permitted by the Commission, which authorizes the discharge of treated wastewater into the Lake Lewisville Watershed. The District is authorized to divert the amount of Chapman Water Return Flows, calculated as prescribed below. 4.2. Calculation of Chapman Water Return Flows. (a) Chapman Water Return Flows will be calculated by multiplying the daily amount of Treated Chapman Lake Water by a Return Flow Factor, subject to verification of the Return Flow Factor as described below. (b) Subject to verification, the Return Flow Factor may not exceed an annual (calendar year) average of sixty percent (60%) of the amount of the District's Treated Chapman Lake Water which remains after subtracting the amount of the District's Chapman Lake Water which is used by the District or one of its customers which does not return to a wastewater Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 12 of 30 treatment plant which discharge into the Lake Lewisvitle, pursuant to Commission authorization. (c) The District will develop monthly Return Flow Factors as follows: The District, in cooperati°n with Dallas and Denton, shall perform an analysis to determine the initial monthly return flow factors before the first use of Chapman Water Return Flows occurs. The Return Flow Factor will be expressed as a percentage of Treated Chapman Lake Water. Thereafter, the District shall determine the Return Flow Factor on a monthly basis using the methodology prescribed in this Agreement. The monthly Return Flow Factor will be used to calculate daily return flows occurring during that month. By November 1 of each year after the first year of the District's use of Chapman Water Return Flows, the District shall perform an analysis of the Lakeview Regional Water Reclamation System Treatment Plant and other District wastewater treatment plants to determine the actual monthly return flow factors and the annual average to date for the then current year. The analysis done by the District will be in cooperation with Dallas and Denton and is subject to review and approval by Dallas, which approval will not be unreasonably withheld. The results of this analysis will be used to adjust the District's use of Chapman Water Return Flows to assure that the Return Flow Factor will not exceed sixty percent (60%) for the total year as provided in Section 4.2 (b) above. 4 In determining the Return Flow Factor, the District shall determine the amount of Treated Chapman Lake Water lost through Consumptive Losses and losses within its wastewater treatment system and within the systems of its wholesale customers, including water sales to customers not connected to a sanitary sewer, and water sold for use outside the Lake Lewisville Watershed, or water which does not return to Lake Lewisvilte watershed for any reason. The analysis done by the District will be in Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 13 of 30 cooperation with Dallas and Denton and is subject to review and approval by Dallas, on an annuat basis which approval will not be unreasonably withheld. In determining the Return Flow Factor, the District shall verify the Return Flow Factor by metering its discharge from any wastewater treatment plant in the Lake Lewisville watershed which treats and discharges water defined herein as Chapman Lake Water. Chapman Water Return Flows discharged by the District into Lake Lewisville will be measured as a percentage of the total metered discharge of the District's and the District's customer's wastewater treatment plants which discharge to Lake Lewisville authorized and permitted by the Commission, which receives wastewater which is the result of the District's authorized sale and use of Chapman Lake Water. ' Channel Losses between the point of discharge from the wastewater treatment plant of the District or one of its customers and the water sudace of Lake Lewisville will be developed in cooperation with DaIlas and Denton using the same per mile factors and methodology set forth in Exhibit "C." ARTICLE FIVE CHAPMAN LAKE WATER ACCOUNTING SYSTEM 5.1. Accountin.q for Chapman Lake Water and Chapman Water Return Flows. (a) Contemporaneous and accurate accounting for water passed through Lake Lewisville and used by the District is necessary to protect the water rights of Dallas and Denton in Lake Lewisville. The Parties agree that daily accounting of Chapman Lake Water and Chapman Water Return FIows discharged and available for diversion by the District is necessary. (b) 'fhe District shall report use of the District's Chapman Lake Water and Chapman Water Return Flows in accordance with the terms and conditions of this Agreement. Monthly reports showing the District's daily use of Chapman Lake Water and Chapman Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 14 of 30 Water Return Flows shall be reported to Dallas and Denton no later than the 154 of the following month. (c) The District, in cooperation with Dallas and Denton, will develop a plan for implementing an Accounting System consistent with the terms and conditions of this Agreement. 5.2. Formula for Accounting for Chapman Lake Water and Chapman Water Return Flows Available for Diversion by the District. The amount of water the District is authorized to divert from Lake Lewisville under this Agreement is in accordance with the following formulas: (a) Water in Lake Lewisville available for diversion by the District is calculated as follows: (The total amount of the District's Chapman Lake Water discharged into Doe Branch minus Boe Branch Conveyance Losses) Plus (Available Chapman Lake Reuse Water) (b) When developing the Return Flow Factors, the following adjustments shall be made to determine the volume of Treated Chapman Lake Water to which the maximum 60% annual Return Flow Factor shall be applied: (Water transported by pipeline from Chapman Lake and diveded directly to the District's water treatment plant, adjusted for losses in the water treatment plant, and pipeline and pumping losses in the raw water system) Plus (The total daily metered discharge of Chapman Lake Water into Doe Branch) Minus (Water diverted by or for use by a person or entity other than the District, including Irving) Minus Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 15 of 30 (Daily Conveyance Losses in Doe Branch, water treatment plant losses, and piping and pumping losses in the raw water system, as calculated under Section 3.4, above) Minus (Chapman Lake Water not returned to a wastewater treatment plant which discharges into Lake Lewisvilte) (c) Chapman Water Return Flows are calculated as follows: (Daily calculation of Treated Chapman Lake Water) Multiplied by (Return Flow Factor, verified in accordance with Section 4.2, above, which total shall be confirmed by actual measurement of effluent being discharged) Minus (Daily Channel Losses, as calculated pursuant to Section 4.2(c), above) 5.3. Accountinq System. The District will report its Lake LewisviIle Pass Through and use of Chapman Lake Water and Chapman Water Return Flows once a month in accordance with the following recorded daily information: (a) Each day, the District will meter and record the total amount of Chapman Lake Water delivered from Chapman Lake by pipeline to the Trinity River Basin. (b) Each day, the District wil[ record the amount of Chapman Lake Water discharged into Doe Branch for use by the District, not including water used by persons or entities other than the District. (c) Each day, the District will record the amount of its Chapman Lake Water lost to conveyance from the discharge point on Doe Branch to Lake Lewisville, in accordance with the methodology prescribed in this Agreement. Daltas/Upper Trinity R. W. D. Chapman Lake Water Page 16 of 30 (d) Each day, the District will record the amount of its Chapman Lake Water transported by pipeline directly to the District's water treatment plant. (e) Upon a determination by Dallas that Evaporation Losses are significant, each day the District will record the amount of Chapman Lake Water and Chapman Water Return Flows lost to evaporation in Lake Lewisville, in accordance with Exhibit "D" of this Agreement. Unless or until Dallas makes that determination, the District is not required to record the amount of Chapman Lake Water lost to evaporation, in accordance with Section 3.5 of this Agreement. (f) Each day, the District will record the amount of Chapman Lake Water diverted from Lake Lewisville. (g) Each day, the District will record the actual amount of Chapman Water Return Flows used and Available Chapman Lake Reuse Water. (h) Each day, the District will record the amount of Chapman Water Return Flows lost to Channel Losses, using the methodology prescribed in this Agreement. (i) Each day, the District will estimate and record its estimates of the following: The amount of Chapman Lake Water being left as inflow into Lake Lewisvilie after all District uses authorized herein. The amount of Chapman Lake Water consumed by Direct Reuse or Indirect Reuse not otherwise reflected in the amounts recorded pursuant to this Section 5.3. (j) Each day, the District shall report the following: The amount of water purchased by the District from Dallas under the "Untreated Water Purchase Contract," dated February 12, 1992, which contract is attached hereto as Exhibit "E." Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 17 of 30 The amount of Lake Lewisville water purchased by the District from Denton under the July 21, 1992 Contract between the District and Denton, entitled, "Contract between City of Denton and Upper Trinity Regional Water District for lnterim Sale of Raw Water," which contract is attached hereto as Exhibit (k) in accordance with this Agreement, the District's diversion and/or use of Chapman Lake Water and Chapman Water Return Flows from Lake Lewisville on any day shall not exceed the respective amounts available for the District's use as shown by the Accounting System set forth in this Agreement. The Parties recognize that, to the extent that Chapman Lake Water and Chapman Water Return Flows are not fully consumed on a daily basis, the unconsumed portions of Chapman Lake Water and Chapman Water Return Flows are inflows to Lake Lewisville, to be divided in accordance with agreements between Dallas and Denton, the water rights holders in Lake Lewisvitle. 5.4. Frequency of AccountiEg. Accounting for, and recording the use of, Chapman Lake Water and Chapman Water Return Flows shall be done under the Accounting System on a daily basis and reported to Dallas and Denton on a monthly basiS no later than the 15th of the following month. 5.5. Limitation on the District's Water Use. The District's use of Lake Lewisville for Pass Through of Chapman Lake Water is restricted as follows: (a) The District's diversion and use of water from Lake Lewisville on any day must not exceed, and should be less than or equal to, the amount available for the District's use under the Accounting System. (b) If the District's daily accounting demonstrates that the District has diverted or used more water than is shown to be available to it from Lake Lewisville, the District must adjust its water use on the next day to limit the amount of water used to the amount of water shown to be available to the District under the Accounting System. Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 18 of 30 (ci For every month, the District's monthly report under the Accounting System must demonstrate that the District has taken no more Water than is shown to be available fdr the District's use under the Accounting System on any two consecutive days. (d) The Daily Return Flow Factor will be equal to the monthly Return Flow Factor for that month. 5.6. Periodic Review of the Accountinq System. (a) In' recognition of the importance of contemporaneous and accurate accounting, the Parties agree to review the assumptions and methodologies of the Accounting System as set forth in Article Five of this Agreement and to analyze and compare the results of the Accounting System against the actual experience of the Parties of the effects of the Pass Throughs of Chapman Lake Water and Chapman Water Return Flows on Lake Lewisville. Either Party may request a review of the Accounting System ad frequently as once every twelve month period, and then the Padies will conduct the appropriate analysis, to develop amendments to the Accounting System to provide for more accurate or contemporaneous accounting, consistent with the terms and conditions of this Agreement. (b) The Parties may modify the Accounting System by mutual agreement of Dallas and the District in writing at any time to improve its accuracy or to achieve other goals of the Parties. 5.7. inspection of Records. The daily records kept under the Accounting System shall be subject to inspection upon request by any Party during regular business hours. ARTICLE SIX CHAPMAN LAKE WATER NOT CONSUMED 6.1, Less than Full Use. Chapman Lake Water and Chapman Water Return Flows not fully beneficially used or consumed by the District are inflows into Lake Lewisville and are Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 19 o! 30 authorized to be stored in Lake Lewisville, subject to use by Dallas and Denton under Cedificates of Adjudication No. 08-2456 (Dallas) and No. 08-2335 (Denton). 6.2. No Multiple Pass Throuqhs of Chapman Lake Water or Chapman Water Return Flows. In order to protect the water rights of Dallas and Denton, the District is authorized to Pass Through Chapman Lake Water and Chapman water Return Flows only one time through Lake Lewisville in accordance with the terms and conditions of this Agreement. 6.3. Purchase by the District of Additional Water from Dallas. Based on the Accounting System set forth in Article Five of this Agreement, the District may use Chapman Water Return Flows in an amount not to exceed an annual amount of sixty percent (60%) of the Treated Chapman Lake Water. (a) In any calendar year, subject to Dallas' determination that water is available for sale, the District may purchase from Dallas an additional amount of untreated water out of Lake Lewisville of up to forty percent (40%) of the total annual amount of Chapman Water Return Flows discharged during the previous calendar year. (b) Any additional untreated water purchased by District from Dallas pursuant to this Section shall be purchased at the then Dallas posted ordinance price for untreated water pursuant to the District's untreated water contract attached hereto as Exhibit "E." ARTICLE SEVEN WATER QUALITY 7.1. No Guarantee of Water Quality. All water diverted from Lake Lewisville by the District under this Agreement is done at the risk of the District. Dallas does not guarantee any level of water quality or treatment standards of the water stored in Lake Lewisville. 7.2. District Responsibility for Quality of its Discharqes into Lake Lewisville. Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 20 of 30 (a) The District agrees not to discharge any water into Lake Lewisville which it knows or should know will degrade the water quality or cause Dallas to incur additional treatment or operations costs. If any discharge by the District, whether of conventional or non- conventional pollutants, causes a significant degradation of the water quality in Lake Lewisville, which reduces the usability of the water supply for drinking water purposes or significantly increases treatment, operations and/or maintenance costs of Lake Lewisville, then the Director will notify the District of the problem and the District will be responsible for all reasonable costs of remediating the effects of its discharge into Lake Lewisville and restoring Lake Lewisvitte to its previous level of water quality. (b) Should any significant degradation of water quality in Lake Lewisville occur as the direct result of the District's discharge, and the District does not remedy the problem, then DaItas may act to restore the water quality in Lake Lewisville as expeditiously as possible, after notifying the District such action will be taken and may bill the District for the cost of its effods in restoring Lake Lewisville water quality. The District agrees to pay Dallas' reasonable costs of restoring water quality as expeditiously as possible. (c) Should any issues arise between Dallas and the District related to water quality impacts of the District's use of Lake Lewisville under this Agreement, Dallas agrees to notify the District in writing of the matter, and to schedule a meeting with the District to attempt to determine a mutually satisfactory resolution of the issue. 7.3. ' Participation in Environmental Studies. The District agrees that, if requested by Dallas, it will help fund environmental studies of Lake Lewisville and its tributaries, or studies related to remedial actions. The level of the District's funding for any environmental .study will be negotiated between Dallas and the District, based on such factors as raw water withdrawals from Lake Lewisvitle by all parties, proportional shares of all wastewater discharges, the amount of any pollutant discharge by the District which triggers remedial action, and other factors deemed significant by the Parties. This Agreement does not authorize any discharge of raw water or treated effluent into Lake Lewisville not otherwise authorized by permits issued by the Commission. Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 21 of 30 Further, this Agreement in no way shall limit the right of the Commission to authorize such discharges in the future. 7.4. District's Water Quality Records. The District acknowIedges that the water quality records required to be kept by the Commission are Open Records. Also, the District agrees to file any notification, self-reporting data, sIudge disposal record, or any other record required by the Commission with Dallas at the same time it files such record with the Commission. ARTICLE EIGHT PENDING APPLICATIONS BEFORE THE COMMISSION 8.1. Dallas' Water Riqhts Applications and Reservoir Operations. (a) The District agrees to support and not to protest, directly or indirectly, Dallas' water rights applications on file with the Commission as of the Effective Date of this Agreement. (b) Dallas and Denton are the owners of senior water rights in Lake Lewisville, that is water rights with a much earlier priority date than the District. The District acknowtedges that it enters into this Agreement knowing that Dallas makes no representations regarding its reservoir operations. The District agrees neither to protest, directly or indirectly, nor to organize protests or opposition regarding Dallas' reservoir operations related to Lake Lewisville under any water rights permit issued to Dallas by the Commission, as long as Dallas' operations are in compliance with its water rights permit. Should the District take actions regarding Lake LewisviIle which are prohibited by this Agreement, then the Director of Dallas Water Utilities, at his option and after written notification to the District, may suspend the District's use of Chapman Water Return Flows under this Agreement until such time as he or she is satisfied that such prohibited actions, and any associated disruption of Dallas water operations has ceased. 8.2. The District's Water Ri.qhtsAp¢cation. Dallas agrees to support and not to protest, directly or indirectly, the District's water rights Application No. 5778 on file with the Commission, Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 22 of 30 as amended pursuant to this Agreement. When this Agreement becomes effective, the District agrees to promptly amend its application to include the terms and conditions of this Agreement. ARTICLE NiNE TERM AND EFFECT OF AGREEMENT 9.1. Effective Date. (a) Dallas will not execute this Agreement, and this Agreement will not become effective until the District, in cooperation with Dallas and Denton, completes the'Accounting System, as specified in Section 5.1(c),' and such Accounting System is approved by Dallas and Denton. (b) The Effective Date of this Agreement will be the date it is fully executed by the Parties, which date is first above written. 9.2. Term. The initial term of this Agreement will commence on the Effective Date of this Agreement and will extend therefrom for a period of thirty (30) years, provided that termination may occur sooner under Sections 9.3 of this Agreement. 9.3. Potential for Termination. After prior written notice and reasonable opportunity for the District to cure or remedy the offending conditions, this Agreement is subject to termination under the following conditions: (a) if any agency, court, or other authority having jurisdiction over the subject matter of this Agreement takes any action which has the effect of limiting, amending, modifying, or revokfng any substantive terms and conditions of this Agreement, then this Agreement, may, at the option of Dallas, become null and void and of no further force and effect. (b) If a reasonable review of records indicates that reports submitted under the Accounting System are not contemporaneous and accurate, or that the Accounting System Dallas/Upper Trinity R.W. D, Chapman Lake Water Page 23 of 30 is not adequate to monitor and record the amount of Chapman Lake Water and Chapman Water Return Flows being passed through Lake Lewisville and used by the District, then this Agreement shalf, at the option of Dallas, become null and void and of no further force and effect. (c) If a review of the District's water quality records, indicates that the District is not complying with the terms and conditions of any wastewater discharge permit which · authorizes its discharges or disposal into the Lake Lewisville Watershed, for a period of four months or longer, if, in the judgment of Dallas, the violation results in an actual or potential hazard to public health and safety or severe adverse impact on or to the uses of Lake Lewisville, then this Agreement shall, at the option of Dallas, become null and void and of no further force and effect. (d) If any of the authorizations required in Section 2.1 become invalid, or no longer effective. 9.4. Renewal. Upon the expiration of the initial term, this Agreement will automatically renew for another thirty (30) year term. If either Dallas or the District wishes to terminate this Agreement at the end of any thirty year term, then prior to the end of such thirty (30) year term that party shall give the other party at least three (3) years notice in writing to the address specified in this Agreement for delivery of notices of its intent to terminate. 9.5. Agreement Unique. This Agreement is unique. The execution of this Agreement by the Parties does not imply that similar agreements will be made with other entities desiring the use of Lake Lewisville for Pass Throughs or return flow water reuse, nor does the execution of this Agreement imply that similar agreements will be made concerning additional or new sources of supply brought into the Trinity River Basin by the District or any other entity. 9.6. No Precedential Value. The Parties agree that this Agreement for the purposes of the use of Lake Lewisville for Pass Throughs of Chapman Lake Water is unique and has no precedential value or application to any other situation or circumstance whatsoever. The Parties have made no inquiry into the applioation of the principles of this Agreement to protecting their Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 24 of 30 interests in other water resource management matters, and reserve the right to do so in each and every situation subsequent to this Agreement. ARTICLE TEN MISCELLANEOUS PROVISIONS 10.1. Remedies Cumulative. (a) In the event of any default by the other Party of the terms'and conditions of this Agreement, the Parties retain all other rights and remedies at law and in equity. (b) Nothing in this Agreement precludes the Parties from attempting to mediate any dispute under this Agreement, provided that mediation is agreed to by both Parties, 10.2. Governinq Law. The provisions of this Agreement shall be governed by and construed and enforced in accordance with the taws of the State of Texas. 10.3. Venue. in the event any legal proceeding is brought by Dallas to enforce this Agreement or any provision hereof, the same shall be brought in Dallas County, Texas. In the event any legal proceeding is brought by District to enforce this Agreement or any provision thereof, the same shall be brought in Denton County, Texas. 10.4. No Rights or Title Acquired. Dallas and the District agree that under this Agreement, the District acquires no continuing rights or title to pass water through Lake Lewisville or divert water from Lake Lewisville beyond the term of this Agreement, other than those rights explicitly set forth in this Agreement, including the terms and conditions of the contracts attached hereto as Exhibits A through F and the authorizations of the Commission needed to effectuate this Agreement. The Parties also agree that the District's right to divert Chapman Lake Water into Lake Lewisville and to divert Chapman Water Return Flows will also terminate in accordance with the terms and conditions of any permit or authorization issued by the Commission, and in accordance Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 25 of 30 with the specific terms and conditions of the District's contracts regarding Lake Lewisville attached hereto and as they may be amended from time to time. 10.5. Modification. Any amendment or modification of this Agreement must be in writing, agreed to by both Dallas and the District, and executed with the same formalities as this Agreement. 10.6. Potential for Amendment. The parties recognize that this Agreement may be amended in the future to aIIow the District to pass additional water through Lake Lewisville. The source of such additional water and the terms and conditions necessary to protect the senior water rights owned by DaIlas and Denton and the water quality in Lake Lewisville are unknown at this time. 10.7. Successors. This Agreement shall apply to and be binding on the successors and assigns of Dallas and the District. 10.8. A..ssi.qnment of this Aqreement. The Parties agree that this Agreement may not be assigned without the express written permission of both Dallas and the District, which permission will not be unreasonably withheld. 10.9. No Third Party Beneficiary. The Parties do not intend by any of the provisions of this Agreement to create in the public or any member thereof a third party beneficiary hereunder, or to authorize anyone not a Party to this Agreement to maintain a suit for personal injuries or property damage pursuant to the terms or provisions of this Agreement. 10.10. Multiple Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 10.11. Notices.' All notices and communications required herein shall be sent by first- class mail to the Parties at the following addresses: Dallas/Upper Trinity R. W. D. Chapman Lake Water Page 26 of 30 .Upper Trinity Regional Water District P. O. Drawer 305 Lewisville, TX 75067 ATTENTION: Executive Director Director, Dallas Water Utilities City of DaIlas 1500 Marilla Street, 4 AN Dallas, Texas 75201 At any time during the term of this Agreement, either Party may change its address by giving written notice to the other Party by first class mail. The Party's change of address under this Agreement will become effective three days after receipt of written notice. 10.12. Force Majeure. (a) In case by reason of force majeure either Dallas or the District shall be rendered unable wholly or in part to carry out its obligation under this Agreement, then such Party shall give notice and full particulars of such force majeure in writing to the other Party within a reasonable time after occurrence of the event or cause relied on, the obligation of the party giving such notice, so far as it is affected by such force majeure, shall be suspended during the continuance of the inability then claimed, but for no longer period, and any such party shall endeavor to remove or overcome such inability with all reasonable dispatch. (b) The term "force majeure"as employed herein, shall mean acts of God, strikes, lockouts, on account of any other industrial disturbances, acts of public enemy, orders of any kind of Government of the United States or the State of Texas or any civil or military authority, insurrections, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrest, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipelines, or canals, partial or entire failure of water supply including pollution (accidental or intentional), or other causes not reasonably within the control of the Party claiming such inability. It is understood and agreed that the settlement of strikes and lockouts shall be entirely within the discretion of the Party having the difficulty, and that the above requirement that any force majeure shall be remedied with all reasonable dispatch shall not require Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 27 of 30 the settlement of strikes and Iockouts by acceding to the demands of the opposing Party or Parties when such settlement is unfavorable to it in the judgment of the Party having the difficulty. 10.13. Representation of Authority. This Agreement has been approved by the respective governing bodies of the Parties hereto; and the undersigned acknowledge and warrant, by their execution of this Agreement that they are properly authorized to execute this Agreement. 10.14. Attachments. This Agreement includes the following attachments: (a) Exhibit A August 24, 1998, Agreement between the District and Denton, entitled, "Upper Trinity Regional Water District Agreement with the City of Denton and City of Lewisville Concerning Water from Cooper (Chapman) Lake." (b) Exhibit [] May 20, 1999, contract Agreement between the District and Irving, entitled, "Contract for Transportation of Water from Chapman Lake," as amended by the amendment dated September 19, 2002. (c) Exhibit C January 8, 1998 agreement between Dallas and lrving, entitled 'M/ater Treatment Services Contract, "including also, the explanatory correspondence both dated March 21,2002 between Dallas and lrving related to the discharge structure and metering." (d) Exhibit D Methodology for Calculating Evaporative Losses; Expanded Area-Capacity Tables and Surface Area Tables for Lake Lewisville dated March 4, 2002, developed by Dallas from the area-capacity tables included in the 2000 Update to Dallas' Long Range Water Supply Ptan; and Page 15 of the Texas Water Development Board Report 64, including a column headed, "Weather Bureau Class A pan" for use in determining evaporation losses. Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 28 of 30 (e) Exhibit E Untreated Water Purchase Contract dated February 12, 1992, under which contract the District may purchase from Dallas water from Lake Lewisviile and Lake Ray Roberts. (f) Exhibit F July 21, 1992 Contract between the City of Denton and Upper Trinity Regional Water District for Interim Sale of Raw Water. 10.15. Entire A.qreement; Amendments and Waivers. This Agreement constitutes the entire agreement between the Parties pertaining to the subject matter hereof and supersedes all · prior agreements, understandings, negotiations and discussions, whether oral or written, of the Parties. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (regardless of whether similar), nor shall any such waiver constitute a continuing waiver unless otherwise expressly provided. CITY OF DALLAS, TEXAS By: ~e~vi/des~, Cit~M g Teodoro J ; ' ana er DATE: ATTEST: By: APPROVED AS TO FORM: . dohhson,-~ Att(;~ey {,~Sm;tted toci y Dallas/Upper Trinity R.W. D, Chapman Lake Water Page 29 of 30 UPPER TRINITY REGIONAL WATER DISTRICT DATE: Richard A. Lubke, President, Board of Directors ATTEST: Sandy Cash~e~retary, Board of Directors APPROVED AS TO FORM: John F. Boyle, Jr., Gen~t Counsel for UTRWD Dallas/Upper Trinity R.W.D. Chapman Lake Water Page 30 of 30 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 49 CITY OF DENTON, TEXAS PUBLIC UTILITIES BOARD MEETING MINUTES May $, 2003 9:00 A.M. After determining that a quorum of the Public Utilities Board of the City of DeNon, Texas was preseN, the Public Utilities Board convened iNo an Open Meeting on Monday, May 5, 2003 at 9:00 a.m. in the Service CeNer Training Room, City of DeNon Service CeNer, 901-A Texas Street, Denton, Texas. PRESENT: Bill Cheek, George Hopkins, Charldean Newell, Dick Norton, Rob Rayner, Dick Smith and Don White EX OFFICIO MEMBERS Mike Conduff, City Manager Howard Martin, ACM/Utilities ITEMS FOR INDIVIDUAl, CONSIDERATION: 1) Receive information and a presentation from a representative of Denton Municipal Electric regarding the capital improvement plan (CIP) for the upcoming fiscal year; discuss, deliberate, consider, and provide Staff with direction regarding such matters. Sharon Mays, Director of Electric Utilities, presented this item. Mays informed the Board that the Electric Capital Improvements Program for the upcoming fiscal year is growth-driven. She explained that $23.4M out of $26.3M is for electric transmission and distribution. Mays summarized the electric budget by detailing a few of the major expenditures for the upcoming fiscal year. She informed the Board that $200,000 was to expand the automated meter reading system and another $50,000 to install a remote meter reading device inside a van. Mays also revealed that the $300,000 included in Building Construction is to pave approximately 57,000 square feet of parking lot at the electric substation on Spencer Road where most of the electric utilities employees are located. Staff had tried several times to fix the problem by laying different types of gravel, but the lot continues to sink into the ground. Board Member Charldean Newell asked if the relocation of water/wastewater lines associated with highway expansions has an effect on the electric utilities. Mays explained that the City has a strict policy of not putting anything underground in the public right-of-way. Board Member Dick Smith waned to know what criteria are used to determine the conversion of overhead to underground utility lines. Chuck Sears, Engineering Administrator, informed the Board that the City of DeNon follows the new developmeN code guidelines, which specify that new resideNial and commercial subdivisions electric utility lines will be underground except for main feeders and transmission lines. EXHIBIT IV 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 49 Smith stated that $350,000 for specific interest projects would not go far and asked how staff determines their projects each year. Sears explained that there is a reserve for unforeseen projects that may arise due to public interest. Martin suggested that the current Downtown Master Plan project is a prime example of the type of specific interest project associated with the use of reserve funds for transmission and distribution lines. Board Member Bill Cheek asked if the Electric CIP is based on population forecasts accepted by the City of Denton. Sears called the Boards attention to the new residential and construction projections found in the backup information, which are based on historical data from existing single or dually certified areas. Cheek asked if the new construction line-item included funds for the addition of new streetlights. Ray Wells, Superintendent/Substations and Metering, explained that the developers will now pay for the street-lights for new development and the City of Denton pays for maintenance and City initiated construction. This was in information only item and required no vote by the Board. Immediately following the CIP presentation the Board entered into closed session. 3) Consider approval of the Public Utilities Board meeting minutes of: a. April 21, 2003 Board Member Don White asked that an addition be made to page 5, line 6; Vffhite stated that 98% of all construction in Southeast Denton is Denton Af/brdable Housing and Habitat for Humanity housing that does not pay taxes. The minutes stand approved with the corrections. Board Member Charldean Newell asked that, while on the subject, the Board consider options for formatting future minutes. This item would have been discussed during the ACM Update segment of the agenda. Newell explained that over the years the formats have ranged from summary to almost verbatim minutes, which makes it difficult for the Secretary to decide what to include. Newell's first suggestion was to focus on the disparities rather than consensus. Newell suggested that the minutes contain less content by providing summaries of staff's presentation. She reasoned that Council Members would not rely on the PUB's version of the presentation for their information. White informed the Board that he believes that the City Council does read the Public Utilities Board minutes. He specified that if one wants a statement included, the board member should notify the Secretary. Hopkins believes that the minutes should be as concise as possible because they lose their importance when they are too lengthy. He recommended that the minutes include any opinions that are contrary to the presentation or the consensus of the Board. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 49 Cheek agreed that the minutes are very lengthy, and stated that if he were a member of the Council, it would be difficult to read all of the minutes because they are redundant. He stated his contention that certain statements have been taken out of the minutes although he does not believe the omission is intentional. Secretary to the Board, Lynn Pedrick, encouraged members to include revisions in the copy of the draft minutes, which is e-mailed to the Board Members prior to the next scheduled meeting. Martin informed the Board that generally, when items are non-controversial, the dialogue is minimal. He remarked that when items such as impact fees come up for discussion, and the Board and staff spend over an hour discussing the issues, it is difficult to document pertinent comments on half ora page. He suggested that the Board examine the rest of the minutes and concluded that a lot of important comments and statements that follow would benefit the City Council. He also pointed out that not only is it a balance from one set of minutes to another, it is a balance between different items on the agenda. 4) Consider approval of Fourth Amended Contract for Professional Legal Services with the Law Firm of Dickstein, Shapiro, Morin & Oshinsky, L.L.P. Mays presented this item. She explained that in January of 2002, the PUB and City Council approved the Third Amended Contract with Dickstein, Shapiro, Morin & Oshinsky, L.L.P. in the amount of $60,000. Those funds were expected to cover both the Transmission Power Agreement (TPA) assignment, the Spencer Generating Plant sale negotiations, and the Ray Roberts plant decommissioning FERC filing. Due to unexpected difficulties in the negotiation of the transfer and sale agreements, the $60,000 was fully expended on that process, leaving no funds for the FERC filing. Hopkins asked if Dickstein, Shapiro, Morin & Oshinsky handles only specific assignments for Denton Municipal Electric. Mays explained that they are used as contract lawyers. White asked how much money did the City of Denton spend on PG &E. Mays responded that the cost was $80,000, which is a standard one-third for attorney fees. Hopkins moved to approve, with a second from Board Member Dick Norton. The motion was approved unanimously. 5) Consider approval of a standard Pole Attachment License Agreement. Mays also presented this item. She informed the Board that Denton Municipal Electric (DME) has allowed other utilities to attach their equipment and lines to DME poles. She explained that there are three agreements in place that establish the terms under which service is allowed. CATV Pole Lease Agreement - City of Denton and Golden Triangle Communications (now Charter Communications) - May 7, 1979 Communication Pole Lease Agreement - City of Denton and North Texas State University - March 1, 1983 Joint Use Contract - City of Denton and General Telephone Company of the Southwest (now Verizon) - July 25, 1967 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 49 The current agreements are out of date and the rate for service needs to be adjusted to be compatible with the cost of providing the service today. Mays remarked that, due to the terms of their contract, Verizon is the only customer that is not required to remove their facilities from poles abandoned by DME in favor of underground installations. Newell asked if current customers were aware that the City is considering a new agreement. Mays responded that they were aware. Michael Copeland, Utility Attorney, explained that Verizon would probably resist a revised pole agreement; therefore, the best action would be a declaratory judgment action regarding how we should approach an agreement that has no expiration date. Hopkins questioned the probability of success regarding a declaratory judgment. Copeland indicated that he would expect a better than 50% chance of success. Smith asked why the Verizon agreement was so different than the other two. Mays responded by explaining that, in 1967, the City was more accommodating to Verizon. Cheek moved to approve, with a second from Norton. The motion was approved unanimously. Consider approval of a change order in the amount of $105,138 to Pharlap Construction for the purchase of fuel and oil tanks, and fuel pumps (4) for use at the landfill. Vance Kemler, Director of Solid Waste, presented this item. Kemler began his presentation by explaining that the current landfill has a single 10,000-gallon tank, which currently services 18 pieces of equipment. The existing tank will not meet the demands of all of vehicles being fueled out of the new facility. Kemler informed the Board that the reason for moving the fueling station for large utility fleet vehicles was to lessen increased Solid Waste operations costs, reduce the risk of accidents involving heavy trucks in neighborhoods around the Service Center that do not have sidewalks, and reduce the damage to light-weight streets in the neighborhood in which the heavy trucks travel. Kemler reported that the FY2004 solid waste budget would be have to be increased by $159,000 to cover additional costs if the fuel, oil tanks and pumps are not purchased and installed. White wanted to know how many vehicles would fuel at the same time at the new site and would it solve future problems. Kemler informed him that six vehicles would be fueled at the same time, which is more than at the existing facility. Cheek asked what made the distance requirements from the scale house change for the existing tank. Kemler responded that the Fire Marshal gave his approval for a shorter 60 fl. distance from the building because the tank would be reconfigured to service off-road vehicles only. White asked if the City of Denton paid a fuel tax. Kemler informed him that the City pays taxes on fuel for on-road vehicles.. Kemler also mentioned the possibility of a future fee for diesel 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 39 4O 41 42 43 44 45 46 47 48 49 fuel to comply with the Texas Emissions Reduction Program (TERP). Cheek pointed out that service-vehicles in the field fuel some of the City's off-road vehicles. Kemler acknowledged that some of the off-road vehicles are not taking up time to fuel at the tanks so that there would be approximately 70 vehicles using the pumps at the landfill fueling facility. Board Member Rob Rayner asked for an explanation of the $62,000 in savings. Kemler explained that the $62,000 in savings is the capital cost savings and stated that, if the City did not build a larger fueling system and continued to use the Service Center, it would have an increased operational cost of $159,000 per year. Norton mentioned that the yearly savings would pay for the relocation costs. White inquired why the City was paying Pharlap Construction a 10% profit when they are not responsible for the installation of the fuel tanks. Kemler remarked that Pharlap would be working with the vendor in a supervisory capacity and working with the architect and setting the tanks. Hopkins commented that state statutes requiring bidding are in place for a reason and therefore questioned the propriety of a change order of this magnitude for tanks, which were not a part of the original bid. Kemler responded by informing him that the purchasing staff reviewed the change order and found it appropriate. Kemler asked Hopkins if he was convinced and Hopkins replied he was not convinced the change order is appropriate in this instance. White responded that it was also hard for him to understand that a purchase of this magnitude was not included in the original contract. He pointed out that the consultant has the responsibility of designing a project that does not include these types of changes. Kemler informed him that staff had planned to include this project as a part of the new scale house project originally scheduled for construction during the first quarter of the year. It was then rescheduled to the last quarter of the fiscal year. When staff realized that the City was not going to be able to complete the scale house project, the tanks were included as a change order on this project. Cheek remarked that this is a chance for City government to show that we utilize every opportunity to save money. Rayner requested the cost of the project if the change order were not approved. Kemler remarked that if the change order were denied, it would cost $160,000 just for the tanks. Smith moved to approve, with a second from Norton. The motion carried with a vote of 5 to 2, with Rayner and Hopkins voting against. ~inity Regional ~ate~ Di~i~ con~e~ning ReU~ o~ ~a~e frO~ Coop~ hap~an~ Tim Fisher, Assistant Director of Water Utilities, presented this item. The City of Denton and the Upper Trinity Regional Water District (UTRWD) negotiated an agreement in 1998 referred to as the "Pass Through Agreement". This agreement allowed the use of Denton's water 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 3O 31 32 33 34 35 36 37 38 conservation pool in Lake Lewisville for transferring UTRWD's imported water supply from Lake Chapman, via a bed and bank permit, to their existing water intake on Lake Lewisville. During the negotiations of this agreement, the UTRWD expressed a desire to obtain Denton's approval of the UTRWD's reuse ofwastewater return flows that are discharged back into Lake Lewisville. As a result of the UTRWD's failure to compromise on their position of their reuse proposal and proposed accounting methodology, both the City of Dallas and Denton filed written protests to the TCEQ/TNRCC requesting that a contested case hearing be held prior to the TCEQ/TNRCC issuing a reuse permit. The UTRWD has now agreed to the terms and conditions of an agreement that offers a compromise solution that supports UTRWD's desires to obtain a wastewater reuse permit for imported Chapman Lake water supplies while protecting Denton's and Dallas's existing water supplies in Lake Lewisville. Norton moved to approve the addendum, with a second from Smith. The motion was approved unanimously. 8) Receive a report, hold a discussion and give staff direction on the Water Fiscal Year 2004 Operating Budgets and the Fiscal Year 2004-2008 Capital Improvement Programs (CIP). Hopkins moved to table discussion of the Water Fiscal Year 2004 Operating Budget and FY 2004-2008 CIP until the May 19, 2003 meeting. Norton seconded the motion. The motion was approve unanimously. There being no further business to come before the Board, the meeting was adjourned at 11:52 a.m. Charldean Newell, Chairman Howard Martin, ACM/Utilities Lynn Pedrick, Secretary ADDENDUM TO CONTRACT BETWEEN CITY OF DENTON UPPER TRINITY REGIONAL WATER DISTRICT AND CITY OF LEWISVILLE CONCERNING REUSE OF WATER FROM COOPER (CHAPMAN) LAKE State of Texas County of Denton This Addendum (the "Addendum") to an existing contract (the "Contract") entitled UPPER TRINITY REGIONAL WATER DISTRICT AGREEMENT WITH CITY OF DENTON AND CITY OF LEWlSVILLE CONCERNING WATER FROM COOPER (CHAPMAN) LAKE, dated August 24, 1998 by and between UPPER TRINITY REGIONAL WATER DISTRICT, (the "District"), a conservation and reclamation district created pursuant to Article XVI, Section 59 of the Constitution of the State of Texas, and the CITY OF DENTON ("Denton"), a municipal corporation, and the CITY OF LEWlSVILLE ("Lewisville"), a municipal corporation: is made and approved as of the day of _, 2003 (the "Date of Addendum"). WITNESSETH: WHEREAS, Denton, District and City of Lewisville ("Lewisville") entered into the August 24, 1998 Contract Concerning Water From Cooper (Chapman) Lake to enable the District to pass its contracted share of Chapman water through Lewisville Lake to existing intake structures owned by Lewisville and the District for subsequent treatment at water treatment plants owned by the District and Lewisville, respectively: and WHEREAS, said Contract provides in Section 5.0 thereof that: "District agrees to make reasonable efforts to obtain permission from the State of Texas for reuse of water imported into the Trinity River Basin by District from Cooper Lake. Within the framework of this Agreement, Denton and Lewisville will assist the District in development and implementation of a Proposed Reuse Strategy to make full use of District's water from Cooper Lake, avoiding any adverse impact on Denton's water and storage rights in Lewisville Lake. Nothing in this Agreement shall ever be construed as granting to the District any storage rights in Lewisville Lake. Prior to the District making application for such reuse, District shall develop said Proposed Reuse Strategy for approval by the City Manager of Denton and City Manager of Lewisville or their respective designees, which approval will not be unreasonably withheld. Denton and Lewisville agree to cooperate with the District in making and supporting applications to obtain permission for such reuse of water diverted from Cooper Lake, after initially used by the parties and treated and returned to waters of the State of Texas." EXHIBIT V WHEREAS, after the Contract was approved by the cities of Denton and Lewisville, and the District, the District provided the City of Denton and the City of Dallas (the existing water storage and water right holders within Lewisville Lake) with a Proposed Reuse Strategy that included provisions that were objectionable to both parties; and WHEREAS, the District provided Denton and Lewisville with a Proposed Reuse Strategy for approval by the respective City Manager as provided in the contract; and WHEREAS, after considerable effort, a revised Proposed Reuse Strategy was developed and approved by Lewisville; however, Denton maintained certain objections and did not approve the revised Proposed Reuse Strategy; and WHEREAS, the District thereafter filed an application with the State of Texas for a water rights permit that was based upon the Proposed Reuse Strategy, which application was protested by the City of Denton and the City of Dallas, but which protests indicated that negotiations were under way to resolve the objectionable elements of the District's application; and WHEREAS, the ongoing negotiations between Denton, Dallas and District were successful in resolving the elements of the District's Reuse application that were objectionable to Dallas and Denton; and WHEREAS, the District subsequently entered into a contract with the City of Dallas on the 19th day of June, 2003 entitled AGREEMENT BETWEEN CITY OF DALLAS AND UPPER TRINITY REGIONAL WATER DISTRICT REGARDIING USE OF LAKE LEWISVILLE FOR PASS THROUGH OF CHAPMAN LAKE WATER (the "Dallas/District Agreement" - EXHIBIT I hereto); and WHEREAS, the Dallas/District Agreement outlines specific terms and conditions for the City of Dallas' support of the District's reuse permit application that includes specific accounting system requirements for reporting water use, reuse and water purchases by the District from Denton and Dallas (the existing water rights holders in Lewisville Lake), and includes provisions for mutual agreement by both Dallas and Denton for approval of the water accounting system; and WHEREAS, Denton, Lewisville and the District desire to add this Addendum to the existing Contract to incorporate the provisions, terms and conditions in the Dallas/District Agreement related to the reuse permit and water accounting system. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties agree to supplement the Contract with this Addendum as set forth, to-wit: AGREEMENT Section 1.0 Preamble Incorporated That the matters stated in the Preamble hereof are true and correct and are incorporated into the body of this Addendum as if copied in their entirety. Section 1.1 Scope of Addendum That the provisions of the Contract shall remain in full force and effect as supplemented by this Addendum. Further, Denton, Lewisville and the District agree to add the following provisions to provide for mutual agreement of the revised Reuse Strategy and water rights permit application by the District: a) Acknowledgement and acceptance of the terms and conditions for the District's Reuse Strategy for Chapman Lake Water as outlined in the Dallas/District Agreement. b) The District hereby agrees to revise their water rights permit application with the State of Texas to comply with the terms and conditions outlined within the Dallas/District Agreement and this Addendum. c) City of Denton hereby agrees to withdraw its protest of the District's water rights permit application contingent upon a review by Denton of the District's proposed revised water rights permit application and consistency with the terms and conditions outlined in the Dallas/District Agreement and this Contract Addendum. Section 1.2 Term of Addendum This Addendum shall be effective on and from the Date of Addendum. The Addendum shall continue for the Primary Term of the Contract and for any renewals thereof. IN WITNESS WHEREOF, the parties hereto acting under authority of their respective governing bodies have caused this Addendum to be duly executed in several counterparts, each of which shall constitute an original, all as of the day and year first above written, which is the Date of Addendum. UPPER TRINITY REGIONAL WATER DISTRICT CITY OF LEWISVILLE Executive Director City Manager CITY OF DENTON City Manager ORDINANCE NO. 2003- AN ORDINANCE OF THE CITY OF DENTON, TEXAS, AUTHORIZING THE CITY MANAGER TO EXECUTE AN ADDENDUM TO CONTRACT BETWEEN THE CITY OF DENTON, UPPER TRINITY REGIONAL WATER DISTRICT AND CITY OF LEWISVILLE CONCERNING REUSE OF WATER FROM COOPER (CHAPMAN) LAKE; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR: AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, on August 24, 1998 the City of Denton, Texas, Upper Trinity Regional Water District ("UTRWD"), and the City of Lewisville, Texas ("Lewisville") entered into a certain "Contract" in order to enable UTRWD to pass its contracted share of Lake Chapman Water through Lewisville Lake to existing intake structures owned by UTRWD and Lewisville, for subsequent treatment of water treatment plants owned by UTRWD and Lewisville; and WHEREAS, both Denton and Dallas are the existing water right holders in Lake Lewisville; and WHEREAS, since entering into this Contract, UTRWD has formulated a proposed water reuse strategy, which culminated in UTRWD filing an application with the State of Texas for a water rights permit that was based upon the proposed reuse strategy; said application was protested, both by the Cities of Dallas and Denton, as the proposed reuse strategy proposed by UTRWD was objectionable to both cities; and WHEREAS, protracted negotiations ensued, which resulted in UTRWD and the City of Dallas entering into an agreement entitled "Agreement Between City of Dallas and Upper Trinity Regional Water District Regarding Use of Lake Lewisville For Pass-Through of Chapman Lake Water" (the "DallasFUTRWD Agreement"), dated June 19, 2003, which agreement provides for a revision to the UTRWD reuse strategy, and includes specific accounting system requirements for reporting water use, reuse and water purchases by UTRWD from both Denton and Dallas, and said agreement provides for mutual agreement by both Denton and Dallas for approval of the water accounting system; and WHEREAS, Denton, UTRWD and Lewisville desire to execute this Addendum to the existing Contract to incorporate the provisions, terms, understandings, covenants and conditions in the later Dallas/UTRWD Agreement related to both the reuse permit (and its revised contents) and the water accounting system; NOW THEREFORE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: ~qECTION 1. That the above Preamble to this ordinance be, and it is, hereby ratified, confirmed, and incorporated as being the true and correct factual background for this transaction, which recitations are set forth and are included as a part of, and the subject of this ordinance. EXHIBIT VI SEC_TIONI 2_ The City Manager is hereby authorized to execute on behalf of the City, an "Addendum to Contract Between The City of Denton, Upper Trinity Regional Water District, and City of Lewisville - Concerning Reuse of Water From Cooper (Chapman) Lake", a copy of which Addendum is attached hereto and incorporated by reference herein. SECTION 3. The expenditure of funds as set forth in the Agreement is hereby authorized. ~. This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ., 2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY S:\Our Documents\Ordinances\03\UTRWD Addendum - Ordinance [UTRWD-Lcwisville-Denton] 2003,do0 2 AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Materials Management Kathy DuBose, Fiscal and Municipal Services Questions concerning this acquisition may be directed to Sharon Mays 349-8487 SUBJECT Consider adoption of an Ordinance accepting competitive bids and awarding an annual comract for the purchase of electric distribution cables; providing for the expenditure of funds therefore; and providing an effective date (Bid 3043-Annual Price Agreemem for Electric Distribution Cables awarded to Techline, inc. in the estimated amoum of $471,050). BID INFORMATION This bid is for the annual comract to supply electric distribution cables for DeNon Municipal Electric. These items are carried in the Warehouse working capital invemory for easy access. RECOMMENDATION We recommend that this bid be awarded to the lowest responsible bidder meeting specifications, Techline, inc., in the estimated annual amoum of $471,050 as listed in the Exhibit A of the ordinance. TEC Utility Supply has offered a lower price for underground primary cables quoting a CME brand cable. The Electric Engineering staff has determined that the lower price cable fails to meet the minimum requirements outlined in the bid specifications in several areas including failure to meet currem iCEA standards for power cable, compaction of the cable strands, numerous quality of packaging issues, insulation stripping, and bend ability. Pricing from Southwest Electric was on the same CME manufactured cable. Other lower price offerings were rejected due to minimum shipping quamities and failure to meet specifications for type of insulation and/or length of firm pricing. The complete evaluation is on file in the office of the Purchasing Agem and available for review upon request. PRINCIPAL PLACE OF BUSINESS Techline, Inc. Fort Worth, TX ESTIMATED SCHEDULE OF PROJECT This price agreemem will be in effect for a period of one year from the date of award and may be extended for additional one-year periods if agreed to by both parties with all pricing, terms and conditions remaining the same. Agenda Information Sheet August 19, 2003 Page 2 FISCAL INFORMATION The items in this bid will be funded out of the Warehouse working capital account and charged back to the using department. Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1: Bid Tabulation 1-AlS-Bid 3043 Attachment 1 BID ~ 3043 DATE:7/10/03 ELECTRIC DISTRIBUTION CABLES Hughes Alt Cable, 750 cu, EPR 40,000 Primary, shielded (see 280180-110 $4.97 $198,800 $5.05 $202,000 NO BID $0 NO BID $0 $4.66 $186,400 $4.98 $199,200 shielded EPR detail section attached) Primaw, Full :able, 350 ALI-3S0 AL Cable, 500 .... 600V Wire, 4/0 Soft D .... Attachment 1 BID ~ 3043 DATE:7/10/03 ELECTRIC DISTRIBUTION CABLES Stuart C~,e, ~0 ~u, E~R _-able; Al_ ~0 iiPha~e, Primary, F.II :a~,e, 3S0 AL,-3S0 AL, 4/0 ALI, 600V, XLP, C~,e, SOO .... 600V ,, ,,ooo ~,,, ~ ~,~n,,,ooo~. ,ee,~ ~0-~,-~,0 Wire, 4/0 Sort D .... Attachment 1 BID cf 3043 DATE:7/10/03 ELECTRIC DISTRIBUTION CABLES Si western Electric Alt! Cable, 750 cu, EPA i 40,000 Primary, shielded (see 280-80-110 $5.07 $202,800 NO BID $0 shielded EPR detail section attached) Primaw, Full Concentric Neutral, ~ ', 3 20,000 Strand Filled, 220 Hil. 280-80-056 NO BID $0 NO BID $0 (See Concentric EPR detail section attached) , , Cable, AL Cf 2 1-Phase Primary Full Concentric Neutral, 5 50,000 Strand Filled, 220 Mil. 280-80-010 NO BID $0 $.900 $45,000 (See Concentric EPR detail section attached) Cable, 350 ALI-350 AL 4/0 ALI, 600V, XLP, 37,37,19 Strand $2.06 $10,300NO BID $0 7 5,000(Wesleyan) 3-Yellow280-35-230 longitudinal stripes on Neutral 1,000 ft. reels g 20,000 (Converse) 3-Yellow280-80-070 $.862 i $17,240 NO BID i $0 Neutral 1,000 ft. reels Cable, 500 cu,, 600V il s,ooo×,p, 37 Strand 1,000280-24-340 $2.42 i $12,100 NO BID i $0 Wire, 4/0 So[t Drawn ORDINANCE NO. AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL CONTRACT FOR THE PURCHASE OF ELECTRIC DISTRIBUTION CABLES; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (BID 3043-ANNUAL PRICE AGREEMENT FOR ELECTRIC DISTRIBUTION CABLES AWARDED TO TECHLINE, INC. IN THE ESTIMATED AMOUNT OF $471,050). WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipment, supplies or services in accordance with the procedures of State law and City ordinances; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described bids are the lowest responsible bids for the materials, equipment, supplies or services as shown in the "Bid Proposals" submitted therefore; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered bids for materials, equipment, supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent, are hereby accepted and approved as being the lowest responsible bids for such items: BID ITEM NUMBER NO VENDOR AMOUNT 3043 1- 13 Techline, Inc. Exhibit A SECTION 2. That by the acceptance and approval of the above numbered items of the submitted bids, the City accepts the offer of the persons submitting the bids for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and related documents. SECTION 3. That should the City and persons submitting approved and accepted items and of the submitted bids wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums contained in the Bid Proposal and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items of the submitted bids, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved bids or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this __ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: 3-ORD-BID 3043 Z 0 0 0 0 o X ,--~ o Z o o o AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Materials Management Questions concerning this acquisition may be directed to Vance Kemler 349-8044 Kathy DuBose, Fiscal and Municipal Services SUBJECT Consider adoption of an Ordinance accepting competitive bids and awarding an annual comract for the purchase of from load refuse comainers; providing for the expenditure of funds therefore; and providing an effective date (Bid 3044-Annual Price Agreemem for From Load Refuse Comainers awarded to Wastequip May Fab in the estimated amoum of $110,000). BID INFORMATION This bid is for the annual contract to supply from load refuse comainers for the Demon Solid Waste Department. These items are carried in the Warehouse working capital inventory for easy access. RECOMMENDATION We recommend that this bid be awarded to Wastequip May Fab as listed on Exhibit A of the attached ordinance. PRINCIPAL PLACE OF BUSINESS Wastequip May Fab Beeville, Texas ESTIMATED SCHEDULE OF PROJECT This price agreemem will be in effect for a period of one year from the date of award and may be extended for additional one-year periods if agreed to by both parties with all pricing, terms and conditions remaining the same. FISCAL INFORMATION The items in this bid will be funded out of the Warehouse working capital amoum and charged back to the using department. Agenda Information Sheet August 19, 2003 Page 2 Attachment 1: Bid Tabulation 1-AlS-Bid 3044 Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent ORDINANCE NO. AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL CONTRACT FOR THE PURCHASE OF FRONT LOAD REFUSE CONTAINERS; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (BID 3044-ANNUAL PRICE AGREEMENT FOR FRONT LOAD REFUSE CONTAINERS AWARDED TO WASTEQUIP MAY FAB IN THE ESTIMATED AMOUNT OF $110,000). WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described bids are the lowest responsible bids for the materials, equipment, supplies or services as shown in the "Bid Proposals" submitted therefore; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered bids for materials, equipment, supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent, are hereby accepted and approved as being the lowest responsible bids for such items: BID ITEM NUMBER NO VENDOR AMOUNT 3044 1, 2 Wastequip May Fab Exhibit A SECTION 2. That by the acceptance and approval of the above numbered items of the submitted bids, the City accepts the offer of the persons submitting the bids for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and related documents. SECTION 3. That should the City and persons submitting approved and accepted items and of the submitted bids wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums contained in the Bid Proposal and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items of the submitted bids, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved bids or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this __ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: 3-ORD-BID 3044 8 AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Materials Management Kathy DuBose, Fiscal and Municipal Services Questions concerning this acquisition may be directed to Sharon Mays 349-8487 SUBJECT Consider adoption of an Ordinance accepting competitive bids and awarding an annual contract for the purchase of electric distribution conductors; providing for the expenditure of funds therefore; and providing an effective date (Bid 3046-Annual Price Agreement for Electric Distribution Conductors awarded to Priester Supply in the estimated amount of $200,000). BID INFORMATION This bid is for the annual contract to supply electric distribution conductors for Denton Municipal Electric. These items are carried in the Warehouse working capital inventory for easy access. RECOMMENDATION We recommend that this bid be awarded to Priester Supply in the estimated amount of $200,000. PRINCIPAL PLACE OF BUSINESS Priester Supply Arlington, TX ESTIMATED SCHEDULE OF PROJECT This price agreement will be in effect for a period of one year from the date of award and may be extended for additional one-year periods if agreed to by both parties with all pricing, terms and conditions remaining the same. FISCAL INFORMATION The items in this bid will be funded out of the Warehouse working capital account and charged back to the using department. Agenda Information Sheet August 19, 2003 Page 2 Attachment 1: Bid Tabulation 1-AlS-Bid 3046 Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1 BID # 3046 DATE:7/8/03 ELECTRIC DISTRIBUTION CONDUCTORS PFinciple Place oF Business: Wire, 1590 Bare Aluminum Conductor, Class AA, 61 1 20,000 280 16 130 Strand, Overall diameter 1.525, D.C. resistance .0109 1.831 $36,620.00 $2.10 $42,000.00 ohm/m, rated breaking strength 27,000 lbs. (Code name "Coreopsis" on 5, 000 Ft. steel reels) Wire, 556.5 Bare Aluminum Conductor, Class AA, 37 3 50,000 280 16 700 Strand, Overall diameter .858, D.C. resistance 0.0312 .644 $32,200.00$0.73 $36,500.00 ohm/m, rated breaking strength 10,770 lbs. (Code name "Mistletoe" on 5,000 Ft. non returnable reels). Wire, 4/0 Bare Aluminum Conductor, Class AA, 7 Strand, Overall diameter .522 D.C. resistance .0817 ohm/m, rated 5 50,000 280 16 080 breaking strength 3,830 lbs. (Code name "Oxlip" on 3,000 .251 $12,550.00$0.26 $13,000.00 Ft. non returnable reels). Wire, 795 Bare Aluminum Conductor, Class ACSR, 26/7 Strand, Overall diameter 1.108, D.C. resistance 0.0214 $1.62 $8,100.00$1.28 $6,400.00 7 5,000N/A ohm/m, rated breaking strength 31,500 lbs. (Code name "Drake" on 5,000 Ft. non returnable reels). Wire, 4/0 4/0 4/0 AL, 6000V XLP, 19 Strand, (Appaloosa) 9 10,000 280 35 140 (4/0 QSC) Unshielded neutral is ACSR 6/1 Steel Cord 1.507 $15,070.00 $1.63 $16,300.00 Diameter .1878, phase identification ABC + Sequential Footage marking at (2 ft minimum intervals) 1,000 reels. Wire, 2/0 2/0 2/0 AL, 600V XLP, 19 Strand, (Grullo) (2/0 115,000280 35 120 QSC) Unshielded neutral is ACSR 6/1 Steel Cord diameter 1.152 $5,760.00$1.20 $6,000.00 .1489, Phase Identification minimum intervals) 1,000 Ft. Attachment 1 BID # 3046 DATE:7/8/03 ELECTRIC DISTRIBUTION CONDUCTORS I I I ...................... Pnndple Place of Business: Wire, 1590 Bare Aluminum 6onductor, 61ass AA, 61 i 20,006 280 16 130 Strand, Overall diameter 1.525, D.6. resistance .0109 $1.95 $39,000.00 1.795 $35,900.00 $1.83 $36,600.00 $1.93 $38,600.00 ohm/m, rated breaking strength 27,000 lbs. (6ode name "6oreopsis" on 5, 000 Ft. steel reels) ORDINANCE NO. AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL CONTRACT FOR THE PURCHASE OF ELECTRIC DISTRIBUTION CONDUCTORS; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (BID 3046-ANNUAL PRICE AGREEMENT FOR ELECTRIC DISTRIBUTION CONDUCTORS AWARDED TO PRIESTER SUPPLY IN THE ESTIMATED AMOUNT OF $200,000). WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipment, supplies or services in accordance with the procedures of STATE law and City ordinances; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described bids are the lowest responsible bids for the materials, equipment, supplies or services as shown in the "Bid Proposals" submitted therefore; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered bids for materials, equipment, supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent, are hereby accepted and approved as being the lowest responsible bids for such items: BID ITEM NUMBER NO VENDOR AMOUNT 3046 1 - 12 Priester Supply Exhibit A SECTION 2. That by the acceptance and approval of the above numbered items of the submitted bids, the City accepts the offer of the persons submitting the bids for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and related documents. SECTION 3. That should the City and persons submitting approved and accepted items and of the submitted bids wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums contained in the Bid Proposal and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items of the submitted bids, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved bids or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this __ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: 3-ORD-BID 3046 CO 0 ~ r-~ Z 0 0 0 0 0~ 0 0 0 0 0~ r-~ rq 0 .,-i r'~ 0 0 0 0 0 0 0 L~ r~ o o o AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Materials Management Kathy DuBose, Fiscal and Municipal Services Questions concerning this acquisition may be directed to Tom Shaw 349-7100 SUBJECT Consider adoption of an Ordinance accepting competitive bids and awarding an annual contract for the rental of heavy equipment; providing for the expenditure of funds therefore; and providing an effective date (Bid 3053-Annual Price Agreement for Rental of Heavy Equipment awarded in the estimated amount of $500,000). BID INFORMATION This bid is for the annual contract to supply the rental of heavy equipment to all City departments. From time to time, the City of Denton has a need for heavy equipment to supplement our fleet. This annual Agreement will allow us quick access to expensive equipment without the delay of the bid process. In addition, the annual Agreement for multiple items lends itself to more competitive pricing than incidental usage. No guarantee of any minimal usage is part of this Agreement and each rental will have an individual purchase order. The equipment list consists of the most commonly used sizes and types of heavy equipment. RECOMMENDATION We recommend award of this contract to the lowest responsible bidder for each item as listed below. Vendor Item Number Bane Machinery Continental Equipment Crescent Machinery Future Equipment Co. Hertz Equipment Rental Holt CAT Pioneer Rental TKO Equipment Co. United Equipment Rentals 13, 14 4, 35, 43 17, 18, 24, 25 6-9, 15, 19-21 16, 42 10-12, 23, 33, 49 5 1-3, 29, 31, 32, 34, 36-41, 48 22, 26-28, 30, 32 Items 44, 45, 46, 47, 50 and 51 will not be awarded at this time. Agenda Information Sheet August 19, 2003 Page 2 PRINCIPAL PLACE OF BUSINESS Bane Machinery Continental Equipment Dallas, Texas Dallas, Texas Future Equipment Co. Hertz Equipment Rental Euless, Texas Fort Worth, Texas Pioneer Rental TKO Equipment Co. Denton, Texas Irving, Texas ESTIMATED SCHEDULE OF PROJECT Crescent Machinery Dallas, Texas Holt CAT Fort Worth, Texas United Equipment Rentals Fort Worth, Texas This price Agreement will be in effect for a period of one year from the date of award and may be extended for additional one-year periods if agreed to by both parties with all pricing, terms and conditions remaining the same. FISCAL INFORMATION These items will be charged to the using Departments as needed. Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1: Tabulation Sheet 1-AlS-Bid 3053.doc z z z z z z z z z ._> U > · > · > ~ ~ >co ~_--, -'5 Lo '5 ~ ~ 'so. Lo '5 ~ '5 ~ '5 ~ ~ '5 ~ ~ z ~ z z z z z 0 0 ~ o z 0 0 0 0 0 Z Z ::::::::::::::::::::::: Z Z Z 0 0 0 0 0 Z Z ::::::::::::::::::::::: Z Z Z Z Z Z z ._ ,~ .> ,~ .> -~ ,,x, m x m ~ ~- :::::::::::::::::::::: :::::::::::::::::::::: I,- ::::::::::::::::::::::: :'- :'- Z z :::::::::::::::::::::: :::::::::::::::::::::: iiiiiiiiiiiiiiiiiii ~ o- Z z :::::::::::::::::::::: :::::::::::::::::::::: iiiiiiiiiiiiiiiiiiiiii :::::::::::::::::::::: iiiiiiiiiiiiiiiiii ~- ._> CJ > ,~ > ,~ > ~ ,~ > ~ o o o o ,R© = ~ ~ ~, = ~ ~ ® = ~ ~ = ~ ~ z z z ::::::::::::::::::::::: z z z U > ~ ~ ._ ,~ .> ,~ .> -~ ,,x, m x m ~ ~- :::::::::::::::::::::: :::::::::::::::::::::: I,- ::::::::::::::::::::::: :'- :'- z z z o o z z z :::::::::::::::::::::: :::::::::::::::::::::: iiiiiiiiiiiiiiiiiii ~ :::::::::::::::::::::::::::::::::: © ORDINANCE NO. AN ORDINANCE ACCEPTING COMPETITIVE BIDS AND AWARDING AN ANNUAL CONTRACT FOR THE RENTAL OF HEAVY EQUIPMENT; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (BID 3053-ANNUAL PRICE AGREEMENT FOR RENTAL OF HEAVY EQUIPMENT IN THE ESTIMATED AMOUNT OF $500,000. WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipment, supplies or services in accordance with the procedures of State law and City ordinances; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described bids are the lowest responsible bids for the materials, equipment, supplies or services as shown in the "Bid Proposals" submitted therefore; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered bids for materials, equipment, supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agent, are hereby accepted and approved as being the lowest responsible bids for such items: BID ITEM NUMBER NUMBER VENDOR AMOUNT 3053 1-3, 29, 31, 32, 34, 36-41, 48 TKO Equipment Co. Exhibit A 3053 4, 35, 43 Continental Equipment Exhibit A 3053 5 Pioneer Rental Exhibit A 3053 6-9, 15, 19-21 Future Equipment Rental Exhibit A 3053 10-12, 23, 33, 49 Holt CAT Exhibit A 3053 13, 14 Bane Machinery Exhibit A 3053 16, 42 Hertz Equipment Rental Exhibit A 3053 17, 18, 24, 25 Crescent Machinery Exhibit A 3053 22, 26-28, 30, 32 United Equipment Rentals Exhibit A SECTION 2. That by the acceptance and approval of the above numbered items of the submitted bids, the City accepts the offer of the persons submitting the bids for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quantities and for the specified sums contained in the Bid Invitations, Bid Proposals, and related documents. SECTION 3. That should the City and persons submitting approved and accepted items and of the submitted bids wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums contained in the Bid Proposal and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items of the submitted bids, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved bids or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this __ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: August 19, 2003 Materials Management Questions concerning this acquisition may be directed to Tom Shaw 349-7100 ACM: Kathy DuBose, Fiscal and Municipal Services SUBJECT An Ordinance accepting competitive bids by way of an Interlocal Agreement with Tarrant County and awarding a contract for the purchase of cellular phone services; providing for the expenditure of funds therefore: and providing an effective date (File 3064-imerlocal Agreemem with Tarrant County for the purchase of cellular phone services, contract awarded to Progressive Concepts, inc. in the estimated amoum of $175,000). BACKGROUND An imerlocal Agreemem for Cooperative Purchasing was approved by Council on June 16, 1998 with Tarrant County allowing the City of Denton to participate in Tarrant County contracts for the supply of goods and services. Tarram County Commissioners Court awarded a comract for cellular telephone service in April 2002 to Progressive Concepts, Inc. The contract terms are in effect through April 2006. Six qualified service providers responded to their request. Bids were evaluated by their Technology Services Division and Purchasing Division and awarded to Progressive Concepts, inc. The City of Garland, City of Carrollton, City of Fort Worth, DFW Airport and DeNon County are some of the entities currently participating in this Agreement. The change in service providers from Cingular to Progressive Concepts, inc. will have no effect on the phone numbers assigned to City of Demon phones. Curremly we have approximately 300 phones and cellular service is a major comributor to our communication efforts During the 2001-02 fiscal year, the Technology Services Department staff began a citywide review of cellular phone usage. They recommended subscription plan changes for each user to best fit their individual needs. Average costs per phone/unit decreased 4% for 02-03 and should decrease an additional 14% for 03-04 to $58.27 per phone/unit per momh. Cellular phone usage is audited annually, and rate plans are adjusted to ensure the best match between specific usage and subscription plans available. Rate plan changes are made with the approval of the Department Director. Agenda Information Sheet August 19, 2003 Page 2 PRIOR ACTION/VIEW (COUNCIL, BOARDS, COMMISIONS) · City Council approved an Interlocal Agreement with Tan'ant County on June 16, 1998. · Tarrant County Commissioners Court approved a contract with Progressive Concepts, Inc. for cellular service on April 9, 2002. RECOMMENDATION We recommend the City of Denton be authorized to participate in this Interlocal Agreement for cellular phone service with Progressive Concepts, Inc. PRINCIPAL PLACE OF BUSINESS Progressive Concepts, Inc. Fort Worth, TX ESTIMATED SCHEDULE OF PROJECT New rates will be effective September 1, 2003. FISCAL INFORMATION The division to which each phone is assigned pays the cost of each cellular phone. Based upon current rates and usage a savings of approximately 10 - 12% is anticipated. The new rates are shown in Exhibit A of the attached ordinance. Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent 1-AlS-File 3064 ORDINANCE NO. AN ORDINANCE ACCEPTING COMPETITIVE BIDS BY WAY OF AN INTERLOCAL AGREEMENT WITH TARRANT COUNTY AND AWARDING A CONTRACT FOR THE PURCHASE OF CELLULAR PHONE SERVICES; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (FILE 3064-INTERLOCAL AGREEMENT WITH TARRANT COUNTY FOR THE PURCHASE OF CELLULAR PHONE SERVICES, CONTRACT AWARDED TO PROGRESSIVE CONCEPTS, INC. IN THE ESTIMATED AMOUNT OF $175,000). WHEREAS, pursuant to Ordinance 2001-001, Tarrant County, Texas has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipmem, supplies or services in accordance with the procedure of state law on behalf of the City of DeNon; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described materials, equipmem, supplies or services can be purchased by the City through the Tarrant County Cooperative Purchasing programs at less cost than the City would expend if bidding these items individually; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipmem, supplies or services approved and accepted herein; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered purchase order for materials, equipmem, supplies, or services, shown in the "Purchase Orders" listed hereon, and on file in the office of the Purchasing Agem are hereby accepted and approved as being the lowest responsible bids for such items: FILE NUMBER VENDOR AMOUNT 3064 Progressive Concepts, Inc. See Exhibit A SECTION 2. That by the acceptance and approval of the above numbered items set forth in the attached purchase orders, the City accepts the offer of the persons submitting the bids to Tarrant County for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, conditions, specifications, standards, quamities and for the specified sums comained in the bid documems and related documems filed with Tarram County (Bid 2001-001), and the purchase orders issued by the City. SECTION 3. That should the City and persons submitting approved and accepted items set forth in the attached purchase orders wish to enter into a formal written agreement as a result of the City's ratification of bids awarded by the Tarrant County, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications and standards contained in the Proposal submitted to the Tarrant County, quantities and specified sums contained in the City's purchase orders, and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items set forth in the attached purchase orders, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approval purchase orders or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: ~'-~;:~:::':" ' ': 3-ORD- FILE 3064 .. ]:RFO 2002'075 ANNUAL'al'O, ,,N,,TRACT CELLUI~"TELEPHONE AIRTIME SERVILE BID PROPOSAL PAGE The County currently has approximately 570 phones and request bids for throe rate plans only. Additional plans may be requested as previously stated. Quantities are best estimates and are wil[ onty be used to calculate best overall bid/offer. Rata Plan #~1 FLAT Flat Rate - Unlimited Usage Anytime Long Distance minutes included in Flat Rate (286 phones) ..... $62 per month 200 minutes Rate Plan #2. ~ MONTHLY AND HOURLY Monthly and Hourly - Low Usage Plan " Monthly Rate - Fixed Per Minute Rate- Fixed, Peak Per Minute Rate - Fixed, After Week Days,'Off Peak (205 phones) 2.~ per month .20 per minute .02 per minute Rate Plan #3 MONTHLY WITH LIMITED MINUTES Monthly Rate - Includes 250 Minutes .Maximum Usage Per minute rate in excess of 250 Minutes (79 phones) 25.50 per month .40 per minute ,Roaming *See Addendum Part 3 * per. Long Distance (Explain): *See Addendum Part 3 Peak is considered week days, Monday through Friday, 7:00 A.M. to 8:00 P.M. 15 Additional Rate Plans cing.u.J. .r' Licensed Wireless Provider Published RateI ~arrantCounty included NightS an~' - Plan Discount Minutes Weekends Out of Plan Minutes · $29.99 $25.49 ,.. 250 ....... '" 35~,~ .... $0.40 $39.99 ":$33.99 ,,. 350 ,.. 3500 $0r40 $49.99" $~2.49 500 3500 ..... $0~35 $69.99 $5~.49 850 3500 $0.35 - $99.99 $84.99 ..,1200 '3500 ",.,, $0.35 ,.. $149.99 '~'127.~9 20~0 3~00 $0.30 $199.9~' ; _$169.~ 3000 ..... 3500 ,,_ $0.25 Rates Include Roaming and 'Long Distance Nights Start at 9:00 P.M. until 6:59 A.M, Monday thru Friday. Weekends Start at 9:00 P.M. Friday until 6:59 A.M. Monday Additional wireless Phone Pricing Model PhOne N~w Activation " Up_grade" Eq,uiPm~nt O..nly N0kia 5165 No Cost $25 $140 Nokia 3360 ~;50 $50 , $170 Nokia 8~60 " .$129 ,.. "- $129'" .. $275 Motorola s~ar Tac Digital $75 $!,..0,0 $210 Miscellaneous Parts - Manu'~acture,s .' Parts Part Generic _ Nokia DC Cord $20 $1~' "Nokia Carry Case $12 $8 "'Nokia .Headset $20 .. $.,.12 Motorola DC Cord $20 $12 '"Motorola Carry,Case $!,,,,2. ,, $8 Motorola Head Set $20 .... ,$12 CORPORATE OFFICE - CUSTOMER CARE DEPARTMENT 5718 AIRPORT FREEWAY, FORT WORTH, TEXAS 76117 METRO (817) 654-6600 OR 800-226~4295 AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: August 19, 2003 Materials Management Questions concerning this acquisition may be directed to Alex Pettit 349-8595 ACM: Kathy DuBose, Fiscal and Municipal Services SUBJECT Consider adoption of an Ordinance awarding a contract for the purchase of wireless communication services as awarded by the State of Texas Building and Procurement Commission; providing for the expenditure of funds therefore; and providing an effective date (File 3063 to Nextel Communications in the annual estimated amount of $99,600). BACKGROUND In April of 2003, the State of Texas through the Department of Information Resources signed a four-year Agreement with Nextel for two-way communication services (Contract DIR-VPC-03- 025). Theses services include "walkie talkie", pager, messaging, voice and cellular service in one instrument. Under this contract, all Texas State, local and public education entities may purchase Nextel products and services at State of Texas pricing. Nextel provides direct connect and cell phone services available in a single hand held unit, an option not offered by Cingular. Depending upon need, an employee might require only communication with other City employees and not need the use of a cellular phone. By comparing cellular rate plans in use by these Departments from Cingular and new plans available from Nextel, a Department could have communications service for less money than they budget for cell phone services. Pilot programs were initiated with some Departments tracking the usage, dependability, and cost to conduct City business. Currently, Technology Services, Engineering, Solid Waste, Facilities Management, and some Police Department personnel utilize this service. Cellular phone usage is audited annually, and rate plans are adjusted to ensure the best match between specific usage and subscription plans available. Use of these combination units in concert with cellular subscription plan changes should decrease average costs per unit/phone by 14% for the 03-04 fiscal year to $58.28 per month. RECOMMENDATION We recommend the City of Denton be authorized to participate in this State of Texas DIR Agreement for two-way communication services from Nextel. Agenda Information Sheet August 19, 2003 Page 2 PRINCIPAL PLACE OF BUSINESS Nextel Communications Austin, TX ESTIMATED SCHEDULE OF PROJECT Currently approximately eighty Nextel instruments are in use. Additional units can be added at any time. FISCAL INFORMATION The cost of individual instruments will be charged to the Department or Division to which it is assigned. Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1: Rate Structure from DIR contract 1-AlS-File 3063 At taeh~ent ! Nextel Rate Plans NATIONAL PLANII Include Nationwide Long Distance N~:lel N~onal 8harerl Minute UOC Plan NexlaJ Nllllona! 8h~md Mln~ ~O0 Plln N~I NaE~al Gh~d MIn~ 500 Plan N~I N~I Oh~md MinCe 700 Plin N~I N~aniJ 9h~d Min~ 1000 Plan N~i N~onal 8h~O MIn~ 1300 Plan N~ N~on~l 8h~d MIn~ 1600 Plan $~ N~r N~anel gh~d ~ifl~ 2300 Plan N~l NaUonar Shared M~ 3500 Plan ISLE Dlsc=unt: IIII I~1 I LOCAL PLAN8 10 Feature Local Calllnc $1 IrlcKicla: PROMOTIONAL PLANS 't0 % Avl~llble with Other Prlnllly RIKi PIing WLme 2off [NeeM Na~niEAMma1~ L~M 30{] .Neeel Na4~m,~mm Une t000 ORDINANCE NO. AN ORDINANCE AWARDING A CONTRACT FOR THE PURCHASE OF WIRELESS COMMUNICATION SERVICES AS AWARDED BY THE STATE OF TEXAS BUILDING AND PROCUREMENT COMMISSION; PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFORE; AND PROVIDING AN EFFECTIVE DATE (FILE 3063 TO NEXTEL COMMUNICATIONS IN THE ANNUAL ESTIMATED AMOUNT OF $99,600). WHEREAS, pursuant to Resolution 92-019, the State Purchasing General Services Commission has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipment, supplies or services in accordance with the procedures of state law on behalf of the City of DeNon; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described materials, equipmem, supplies or services can be purchased by the City through the General Services Commission programs at less cost than the City would expend if bidding these items individually; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipment, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered file for materials, equipmem, supplies, or services, shown in the "Purchase Orders" listed hereon, and on file in the office of the Purchasing Agem, are hereby approved: FILE NUMBER VENDOR PRICE 3063 Nextel Communications $99,600 SECTION 2. That by the acceptance and approval of the above numbered items set forth in the attached purchase orders, the City accepts the offer of the persons submitting the bids to the General Services Commission for such items and agrees to purchase the materials, equipmem, supplies or services in accordance with the terms, conditions, specifications, standards, quantities and for the specified sums comained in the bid documems and related documems filed with the General Services Commission, and the purchase orders issued by the City. SECTION 3. That should the City and persons submitting approved and accepted items set forth in the attached purchase orders wish to enter into a formal written agreement as a result of the City's ratification of bids awarded by the General Services Commission, the City Manager or his designated representative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications and standards contained in the Proposal submitted to the General Services Commission, quantities and specified sums contained in the City's purchase orders, and related documents herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items set forth in the attached purchase orders, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved purchase orders or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: ~--~;:~:::':i" - ': 3-ORD-File 3063 AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: August 19, 2003 Materials Management Questions concerning this acquisition may be directed to Tom Shaw 349-7100 ACM: Kathy DuBose, Fiscal and Municipal Services SUBJECT Consider adoption of an Ordinance authorizing the City Manager or his designee to emer imo an agreement with Bank One, NA and to participate in an agreement between Bank One, NA and the Texas Building and Procurement Commission relating to the use of purchasing cards; repealing Ordinance 99-285; authorizing the City Manager or his designee to make expenditures set forth in the contract; and providing an effective date (File 3068-Agreement 946-A1 between the State of Texas Building and Procuremem Commission/Bank One NA, and the City of DeNon for a Purchasing Card System). BACKGROUND INFORMATION This ordinance allows the City of Denton to continue to participate with the State of Texas Building and Procuremem Commission Purchasing Card (P-Card) Program. Because of the much more favorable terms and conditions the Sate is able to secure, the City of DeNon has participated with the State's P-Card Program since we began our Program in 1999. The State of Texas recently requested proposals for its P-Card Program and awarded the contract to Bank One, N.A. Prior to the Bank One, N.A. successful bid, the State of Texas' contract for this Program had been with Bank of America. The P-Card is very similar to a regular credit card, but with numerous comrols. It is issued to selected employees for the purpose of making small dollar purchases. Depending on the individual user P-Cards have various comrols, which are set up at the time the card is issued. First it must be approved by the Director and then limits are placed on the card, which include dollar amoum, number of transactions per momh, total expenditures per momh, vendor/supplier (commodities), no cash access, etc. P-Cards have helped not only improve productivity for employees out in the field, but have also helped eliminate the need for petty cash and requisitions, purchase orders, and individual vendor check for small ticket items. In addition to the comrols set up for the card itself, the City of Demon program operates under a well-defined review and audit procedure. It helps comrol the process while at the same time allowing individual users flexibility. The City of Demon has had its P-Card Program in place since September 1999. Typical P-Card purchases include small tools, hardware, auto parts, office supplies, safety supplies, reproduction services and computer software. We curremly have 345 cards issued and average about $120,000 total per momh in small dollar acquisitions. Agenda Information Sheet August 19, 2003 Page 2 RECOMMENDATION We recommend the approval of File 3068 and Contract Agreement 946-A1 between the Texas Building and Procuremem Commission/Bank One NA and City of Demon. PRINCIPAL PLACE OF BUSINESS Bank One, NA Commercial Card Services Chicago, IL ESTIMATED SCHEDULE OF PROJECT New purchasing cards can be shipped within two weeks of notification. The distribution process should be complete by the first week of October 2003. FISCAL INFORMATION The actual Purchasing Card System will have no direct financial impact on the City of Demon. Individual purchases will be charged to the appropriate budget line items on a momhly basis. Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1 :Agreement for Procurement Cards 1-AlS-File 3068 BANK ONE Attaclment 1 AGREEMENT BETWEEN ("TBPC Co-Op Entity Name") ("TBPC Co-Op Entity Account Number") and BANK ONE, NA FOR PROCUREMENT CARDS As an authorized member of The Texas Building & Procurement Commission (TBPC) Co-Operative Purchasing Program, (Co-Op) the referenced Co-Op Entity is authorized to participate in the Bank One, NA Procurement Card Contract, 946-A1, between Bank One, NA and TBPC. Additional Representations and Warranties of Public Agencies TBPC Co-Op Entity makes these additional representations and warranties, which are hereby included in the contract document and agreement between Bank One and the Co-Op entity: 1. All TBPC Co-Op Entity Charges shall be for TBPC Co-Op Entity purposes. 2. The rights and obligations of TBPC Co-Op Entity under this Agreement are duly authorized, Legal and valid, and this Agreement is a binding obligation of the TBPC Co-Op Entity, enforceable against TBPC Co-Op Entity in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency and other laws affecting the enforcement of creditors rights and remedies in general, or by the application of equitable principles if equitable remedies are sought. 3. Execution of this Agreement by TBPC Co-Op Entity and performance by TBPC Co-Op Entity of its obligations under this Agreement will not (i) constitute or result in a breach or default under TBPC Co- Op Entity's charter or any contract to which TBPC Co-Op Entity is a party or by which it is bound, or (ii) result in the violation of any applicable law, regulation, ordinance, judgment, decree or order. 4. All approvals and authorizations requked to permit the execution, delivery, performance and consummation by TBPC Co-Op Entity of this Agreement and transaction contemplated under this Agreement have been obtained, including any necessary approvals and authorizations from other governmental agencies 5. Any TBPC Co-Op Entity Charges by TBPC Co-Op Entity under this Agreement (i) are duly authorized and constitute valid and binding obligations of TBPC Co-Op Entity, enforceable against TBPC Co-Op Entity, (ii) shall not cause TBPC Co-Op Entity to exceed any legal limits applicable to the TBPC Co-Op Entity Charges when made, and (iii) constitute the legal expenditures of TBPC Co- Op Entity. 6. Contract is contingent upon continued membership in TBPC Co-Op. Prior to the Effective Date of this Agreement, TBPC Co-Op Entity shall deliver to Bank One the opinion of its counsel (or other counsel acceptable to Bank One) as to the matters set forth in Paragraph 1-6 above, which opinion shall be in the form and substance acceptable to Bank One. Executed by duly authorized officers of the parties to be effective as of (the "Effective Date") and continue until contract 946-A1 is terminated, cancelled or expires. TBPC Co-Op Entity Name By Print Name Title Date Signed BANK ONE, NA By Print Name Title Date Signed ORDINANCE NO. AN ORDINANCE AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO ENTER INTO AN AGREEMENT WITH BANK ONE, NA AND TO PARTICIPATE IN AN AGREEMENT BETWEEN BANK ONE, NA AND THE TEXAS BUILDING AND PROCUREMENT COMMISSION RELATING TO THE USE OF PURCHASING CARDS; REPEALING ORDINANCE 99-285; AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO MAKE EXPENDITURES SET FORTH IN THE CONTRACT; AND PROVIDING AN EFFECTIVE DATE (FILE 3068-AGREEMENT 946-A1 BETWEEN THE STATE OF TEXAS BUILDING AND PROCUREMENT COMMISSION/BANK ONE NA, AND THE CITY OF DENTON FOR A PURCHASING CARD SYSTEM). WHEREAS, the City of Denton wishes to repeal the agreement with Bank of America, NT&SA entered into on September 7, 1999 (Ord. 99-285) and replace the agreement with a similar agreement with Bank One, NA and the State of Texas Building and Procurement Commission; and WHEREAS, a number of Texas cities and other governmental entities have chosen to participate in this contract; and WHEREAS, the City Manager recommends that the City of Denton authorize him to enter into this contract; and WHEREAS, the City Council deems it in the public interest to participate in the agreement for purchasing cards between Bank One NA and the Texas Building and Procurement Commission; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the City Manager is hereby authorized to enter into and participate in that certain agreement between Bank One NA and the Texas Building and Procurement Commission known as Contract 946-A1 and by entering into that certain agreement between the City of Denton and Bank One NA relating to the use of purchasing cards substantially in the form which is attached to and made part of this ordinance for all purposes. The city Manager is further authorized to enter into and to execute any additional contracts or documents necessary to facilitate this agreement. SECTION 2. That the City Manager is hereby authorized to make the expenditure and take actions set forth in the attached agreement. SECTION 3. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: ~--~;:~:::':i" - ': 3-ORD-File 3068 EULINE BROCK, MAYOR AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Materials Management Kathy DuBose, Fiscal and Municipal Services Questions concerning this acquisition may be directed to Tom Shaw 349-7100 SUBJECT Consider adoption of an Ordinance of the City of DeNon, Texas approving an agreemem between the City of DeNon and the DeNon Record Chronicle; approving the expenditure of funds for the purchase of legal advertising services available from only one source in accordance with the provisions of the State law exempting such purchases from requirements of competitive bids; and providing an effective date (File 3065- Agreemem with the Denton Record Chronicle in the amoum of $7.60 per column inch for an estimated award of $30,400). BID INFORMATION This is an annual Agreemem with the DeNon Record Chronicle to publish legal notices for various City Departmems that are required by law to do so. The advertising will be paid by departmems such as: the City Manager's Office, City Secretary, Legal, Parks and Recreation, Planning, Police, Utility Administration and Purchasing. RECOMMENDATION We recommend award of this item to the Denton Record Chronicle in the estimated amount of $30,400. PRINCIPAL PLACE OF BUSINESS DeNon Record Chronicle Denton, TX ESTIMATED SCHEDULE OF PROJECT This Agreemem is for a 12 month period beginning July 27, 2003. FISCAL INFORMATION The using Departmems will provide funding for this item. Agenda Information Sheet August 19, 2003 Page 2 Attachment 1: Retail Advertising Agreement 1-AlS-File 3065 Respectfully submitted: Tom Shaw, C.P.M., 349-7100 Purchasing Agent Attachment 1 RETAIL ADVERTISING AGREEMENT DENTON PUBLISHING COMPANY: You are hereby al~thodzed To publish advertising for ~he undersigned in file De.ton ,Record-Chroninle. Denton Chro.icl~ m~or ~e Grapevine Sun ~S ap~i~ed below: A minimnm af ~0~ inch~ per mo.t~ for ~ peeled uf i~ ~weeks beginning ~tk ~ flq;~O~ ~_ _ , for which ihs aclve~ia~ a~c~a to pay ~e follow~ ~ colu~ i~oh, per publi~tion; payable mOn61y ~ Combination Buy (Daily} ~ Combination Bay {5unday} ~ Combinati~ Buy~edn~day Plus ~ Denton ~cerd-Ghroniel= ~aily} ~. ~ O ~-- ~.ton R~ora-~onicle (gini} ~. ~O Wednesday Plus Denton Tim~ ~ _ ~ ~ol~al~ Tl~c ~ta~vinc S~ (Pic~p Rate ) ~ The t~m, of ~s a~mel~t ~e b~ed o~1 cash wi~ order or ~ny d~ a~ounm ~hh_a~raved cr~t by .tha buainaau ~e D~N ~CU~ONIC~. All rates m'c n~t. No rcbat~ fur ~aumulamd This agf~ment may bc t~r~nat~ by vith~ p~ for mty r~fl at ~y ~e, ff~i~ a~mant is t~natcd by ei~sar p~, a . te~in~iol~hatgc, equal to th~ difl~enae b~gween ~¢nt open ~c ~d adv=rLiscr ag~mcnt ~te, ~. ~11 adVe~lSmg p~d under ~a t~s of ~is a~eameat. ~ill he a~ded m the ~ove nmn~d adrian's billlag. If at ~c and of agreement, adv~is~r h~ fail~ to m~t ~ge eou~iuae~L D~to~ R~d~h~n~cle ~II ~11 ~d~~~ [l~c agr~ment or ~c ~tc dirfer~c~ b~cd on ~umutatcd (in~gc, whichever is mc ~ser am~m. ~ Denth Reauircmcnc~Aa~ ad running more ~han I R-ID~ inrhe~ ia depth ~H b~ ~haq~ ~ 2I-II4 inch~ ~n dvp~- ~O~t ~or ~mgnt~Wc ~ to conl~cpstom~r ~ti~ or p~gc r~ucs~. [l~cvcr placement c~ only ~ ~a~nr~xl E~o~ an~Adiu~m~entn.~ Ple~c ch~k y~r ad th~ first ~y it tuna to s~ ~at ~1 info~ .,a~un is ~ ~is will ensure your a~ is ~acdy What you .want rcad~ to s~. D~ron R~afd-~ronicla ~umeg no ~c~i~ ~ ~o~ a~g copy sub~t~d ~ adv~sam ~ ~a agent.or appr~v~ pr~f ~co~y ~pr ~~a). ~. ~,sr.~r ~ ~t~- billW, if ~y, m thc ch~ thc ~c s~ and cannot ~ ~n~Ule T~r IqC~ aQ~ ~C Tlmt aa~ oj.~nll~t~. Any ~t~n 30 days of da~ of~oiee; od~c~isc, such c[~a will zlo~ ~ prier m ~ae ~d ~e ad la 20 inch~ at I~g~ ~y~t Cll~g~ toting ~ ~ mote oe me ~ wm ~. suo]ect to a production su~la~ge o[ 35~ at ~e cost al' tl~ T~h~et~Te~heeia are available upon requ~at at no ch~go, up tu fiw [~) ta~ah~s o[ ~ ~ Rd~i?~onal taar~ marled a~ th~ end of tl~e m~m units mne~ise ~u~tee ~ Canecllnfi~ - A~ ~a~ccll~ dior dcadi~c ~ii ~ ~Ued f~ ~le ~nt at' ~acc res~cd by adv~.~ This ag~t is v~id and blading I~ ex~utlor~ and is made eubj~r to ~ r~ladons cuvc6ng a~a~m~cc mid of advemsing wid~ the D~N P~S~G Mailiag Addrena Denton gerard Chronicla ORDINANCE NO. AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING AN AGREEMENT BETWEEN THE CITY OF DENTON AND THE DENTON RECORD CHRONICLE; APPROVING THE EXPENDITURE OF FUNDS FOR THE PURCHASE OF LEGAL ADVERTISING SERVICES AVAILABLE FROM ONLY ONE SOURCE IN ACCORDANCE WITH THE PROVISIONS OF THE STATE LAW EXEMPTING SUCH PURCHASES FROM REQUIREMENTS OF COMPETITIVE BIDS; AND PROVIDING AN EFFECTIVE DATE (FILE 3065- AGREEMENT WITH THE DENTON RECORD CHRONICLE IN THE AMOUNT OF $7.60 PER COLUMN INCH FOR AN ESTIMATED AWARD OF $30,400). WHEREAS, the City has solicited, received and tabulated competitive bids for the purchase of necessary materials, equipmem, supplies or services in accordance with the procedures of State law and City ordinances; and WHEREAS, the City Manager or a designated employee has reviewed and recommended that the herein described bids are the lowest responsible bids for the materials, equipmem, supplies or services as shown in the "Bid Proposals" submitted therefore; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the materials, equipmem, supplies or services approved and accepted herein; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. That the numbered items in the following numbered bids for materials, equipmem, supplies, or services, shown in the "Bid Proposals" on file in the office of the City Purchasing Agem, are hereby accepted and approved as being the lowest responsible bids for such items: FILE NUMBER 3065 VENDOR DeNon Record Chronicle AMOUNT $7.60/column inch SECTION 2. That by the acceptance and approval of the above numbered items of the submitted bids, the City accepts the offer of the persons submitting the bids for such items and agrees to purchase the materials, equipment, supplies or services in accordance with the terms, specifications, standards, quamities and for the specified sums comained in the Bid Invitations, Bid Proposals, and related documents. SECTION 3. That should the City and persons submitting approved and accepted items and of the submitted bids wish to enter into a formal written agreement as a result of the acceptance, approval, and awarding of the bids, the City Manager or his designated represemative is hereby authorized to execute the written contract which shall be attached hereto; provided that the written contract is in accordance with the terms, conditions, specifications, standards, quantities and specified sums comained in the Bid Proposal and related documems herein approved and accepted. SECTION 4. That by the acceptance and approval of the above numbered items of the submitted bids, the City Council hereby authorizes the expenditure of funds therefor in the amount and in accordance with the approved bids or pursuant to a written contract made pursuant thereto as authorized herein. SECTION 5. That this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this __ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: 3-ORD-File 3065 AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Electric Utility Howard Martin, 349-8232 SUBJECT: AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES WITH LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING DENTON'S COMPLIANCE WITH PUBLIC UTILITY COMMISSION OF TEXAS ELECTRIC TRANSMISSION SERVICE RULES; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTIVE DATE. BACKGROUND: For the past seven years, it has been the practice of Denton Municipal Electric (DME) to maintain a contract with the Lloyd, Gosselink firm for general representation on issues of importance to DME that come before the PUCT. The most recent of these contracts was issued December 18, 2001 in the amount of $65,000. All funds have been utilized in that contract. Lloyd, Gosselink is located in Austin where they have ready access to the PUCT. They are familiar with the PUC process. Their firm tends to specialize in representation of municipal entities. Their firm is also used by Garland. Since Garland's and DME's interests are usually the same in PUCT proceedings, it is often possible to file joint comments with Garland and split the legal fees. An example of the type of issue covered by this Agreement is work the firm is performing on the issue of preventing the sending of solicitations to DME customers by Retail Energy Providers marketing in the former TXU opted in service area. Although Senate Bill 7 forbids this activity, it has been occurring on a regular basis. The Lloyd, Gosselink form has provided the legal research to prove that this activity is unlawful to the staff of the Texas Public Utility Commission (TPUC) in an attempt to get the staff to take steps to stop it. If that effort is not successful, it may be necessary to make a formal filing at the TPUC to stop the activity. This general Agreement is also used to allow work to begin in a timely fashion on issues such as the collection of Competitive Transition Charges from DME customers and the filing of initial comments on the electric wholesale market design issue. The need to react to such issues often occurs much faster than the City's contract approval process can accommodate. This Agreement is used to allow DME to participate effectively at the beginning of developing issues. When it becomes apparent that an issue will require a significant level of expenditure, approval of separate agreements covering that issue is obtained from the Public Utilities Board and City Council. The City Utility Attorney cannot effectively perform this activity for the following reasons. First, his workload does not allow time to support this activity. This attorney supports the legal requirements of all the City utility departments. The legal needs of the other utilities would suffer greatly due to both the additional time required to perform the work and the fact that there is no way to control the timing of the workload. The TPUC sets the schedule for responses in their proceedings. Second, this work can be performed much more effectively and efficiently by someone located in Austin. Third, the utility attorney has no experience in regulatory law. Therefore, the time required for him to deal with such issues would be greater than the time required by an attorney who operates in that environment on a daily basis. Fourth, firms that work regularly with the TPUC staff and Commissioners have useful personal relationships with staff members that can assist in resolving issues. The City Utility Attorney does review and approve each fee bill submitted by all law firms under contract to DME. OPTIONS: 1. Approve the contract 2. Reject the contract and attempt to perform this work with City legal staff 3. Cease to participate in PUCT proceedings that impact DME. RECOMMENDATIONS: DME recommends approval of the contract. PRIOR ACTION/REVIEW (Council, Boards, Commission): The Public Utilities Board will consider this item at its August 18~h, 2003 meeting. Their recommendation will be provided to Council at the August 19~h City Council meeting. FISCAL INFORMATION: The cost of this contract is not to exceed $50,000. EXHIBITS: 1. Ordinance 2. Agreements Respectfully submitted: Sharon Mays Director of Electric Utilities ORDINANCE NO. 2003- AN ORDINANCE OF .THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES WITH LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING DENTON'S COMPLIANCE WITH PUBLIC UTILITY COMMISSION OF TEXAS ELECTRIC TRANSMISSION SERVICE RULES; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTWE DATE. WHEREAS, the City Council deems that it is in the public interest to engage the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas (the "Firm") to provide professional legal services to the City of Denton, Texas ("City") pertaining to representation of the City and Denton Municipal Electric ("DME") before the Public Utility Commission of Texas ("PUC") in the areas of public utilities regulatory law and administrative law, respecting Denton's compliance with PUC electric transmission service rules as well as any rulemaking, proceeding, docket or any project relating to electric transmission service or to matters affecting municipally owned utilities; and WHEREAS, the City staff has reported to the City Council that there is a substantial need for the above-referenced professional legal services, and that limited City staff cannot adequately perform the specialized services and tasks which are primarily centered in Austin, Texas, with its own personnel; and WHEREAS, the City has heretofore engaged the Firm by numerous previous Agreements for Professional Legal Services to perform similar services to those services provided for in the Agreement for Professional Legal Services attached hereto. Further, that the Firm has performed and provided legal services benefiting the City under the most recent Agreement on a continuous and uninterrupted basis, in order to safeguard and represent the interests of the City and DME before the PUC, in dealing with sudden, largely unpredictable events and developments, and with administrative deadlines that many times require immediate attention or response. Accordingly, it is appropriate that the new Agreement for Professional Legal Services by and between the City and the Finn attached hereto, should be ratified and confirmed, and should be retroactively approved and made effective as of July t, 2003, in order to properly compensate the Firm fOr its work that has already directly benefited the City, and which work was done at the specific instance and request of thc City; and WHEREAS, Chapter 2254 of the Texas Government Code, known as the "Professional Services Procurement Act", generally provides that a City may not select a provider of professional services on the basis of competitive bids, but must select the provider on the basis of demonstrated competence, knowledge, and qualifications, and for EXHIBIT 1 a fair and reasonable price; and the Council hereby finds and concludes that the Firm is appropriately qualified under the provisions of that law to be retained as outside legal counsel for the City and DME respecting this engagement; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1: That the recitations set forth and contained in the foregoing preamble are expressly incorporated by reference into this Ordinance. SECTION2: That the City Manager is hereby authorized to execute an Agreement for Professional Legal Services by and between the City and the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas, in substantially the form of the Agreement for Professional Legal Services attached hereto and incorporated herewith by reference. SECTION 3: That the award of this Agreement by the City is on the basis of the demonstrated competence, knowledge, and qualifications of the Firm and the ability of the Firm to perform the services needed by the City for a fair and reasonable price. SECTION 4: That the expenditure of funds as provided in the attached Agreement for Professional Legal Services is hereby authorized. SECTION 5: That the above and foregoing Agreement for Professional Legal Services is hereby ratified, confirmed, and retroactively approved, and shall be effective from and aRer July 1, 2003. SECTION6: That except as otherwise provided in Section 5 above, this Ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the~ day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY STATE OF TEXAS § COUNTY OF DENTON § AGREEMENT FOR PROFESSIONAL LEGAL SERVICES THIS AGREEMENT, made and entered into this __ day of , 2003, by and between LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., a Texas Professional Corporation (hereinafter "Consultant"), with Lambeth Townsend, Shareholder, having full authority to execute this Agreement on behalf of the firm, 111 Congress Avenue, Suite 1800, Austin, Texas, 78701; and the CITY OF DENTON, a Texas Municipal Corporation, 215 E. McKinney, Denton, Texas, 75201 (hereinafter "City"), with Michael Conduff, City Manager, having full authority to execute this Agreement on behalf of the City. WITNESSETH: WHEREAS, the City deems it necessary and in the public interest to continue to engage legal counsel to provide professional legal services with respect to the City's compliance with Public Utility Commission of Texas ("PUC") electric transmission service rules as well as any rulemaking, proceeding, or any project relating to electric transmission service or to matters affecting municipally owned utilities, such as the City; and WHEREAS, the Consultant is willing to perform such services in a professional manner as an independent contractor; and has competently and efficiently performed similar services for the City in numerous other matters before the PUC over the past several years; and the City has selected Consultant on the basis of demonstrated competence and qualifications necessary to perform the needed services; and WHEREAS, the City desires to engage the Consultant to render the professional services in connection therewith, for a fair and reasonable price; consistent with, and for a fee not higher than the recommended practices and fees published by the applicable professional associations; and such fees do not exceed any maximum provided by law; all in accordance with the provisions of Chapter 2254 of the Texas Government Code (the "Professional Services Procurement Act"); and the Consultant is willing to provide such services; NOW, THEREFORE, in consideration of the promises and mutual obligations herein, the City and Consultant do hereby mutually AGREE as follows, to wit: I. Scope of Services: The Consultant shall perform the following services in a professional manner working as an independent contractor not under the direct supervision and control of the City: EXHIBIT 2 106021~Denton Agreement Page 1 A. Services to be provided: Consultant shall represent the City regarding its compliance with PUC electric transmission service rules, and rulemakings, proceedings, or any project's relating to electric transmission service or to matters affecting municipally owned utilities, including without limitation, the professional and legal services attendant to preparing and submitting comments, responding to requests for information, and attending all. heatings and .other proceedings in relationship to such compliance or to matters affecting municipally owned utilities, and to consult with the City through its Denton Municipal Electric staff with regard to all filings, heatings, appeals, and other issues related to such compliance or to matters affecting municipally owned utilities, and to assist in any subsequent actions in response to any Commission final order conceming such compliance or matters affecting municipally owned utilities. To consult with the City Manager, the Assistant City Manager for Utilities, the Director of Denton Municipal Electric, the City Attorney, the Assistant City Attorney for Utilities, and/or other designated, administrative personnel or staff regarding any and all aspects of the professional services to be performed, including legal research, analysis, and advice with respect to protecting the City's position regarding its compliance with PUC electric transmission service rules, and rulemakings, proceedings, or any projects relating to electric transmission service or to matters affecting municipally owned utilities, currently being conducted by the PUC, or which the PUC undertakes in the future. This will include coordinating activities with the Director of Denton Municipal Electric, the City Attorney, and their respective staff to efficiently perform the services required and to preserve the Attorney/Client privilege, work product, and all other applicable exceptions to the discovery or disclosure of documents produced by the City and the Consultant under the Scope of Services hereinabove. The Consultant shall perform all the services required by this Agreement in a timely fashion, and shall complete them in compliance with schedules established by the City through its Director of Denton Municipal Electric as appropriate to carry out the terms and conditions of this Agreement. II. Term: This Agreement shall be retroactively effective as of July 1, 2003. The Agreement shall terminate either upon the completion of the professional services provided for herein or upon the exhaustion of all professional fees provided for hereunder, whichever event shall first occur. This Agreement may be sooner terminated in accordance with the provisions hereof. Time is of the essence of this Agreement. Consultant shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible during the term of this Agreement, and to meet the schedules established by the City, through its Director of Denton Municipal Electric, or her designee. 10602 Fl3enton Agreement Page 2 III. A. Co,mpensation and Method of Payment: The Consultant shall charge the following fees for its professional services provided to the City hereunder, based upon the following hourly billing rates for the attorneys and support staff involved in this matter: Staff Hourly Rate Lambeth Townsend, Shareholder Georgia Crump, Shareholder Melissa E. Ramirez, Associate Paralegal Law Clerk $ 230.00 $ 210.00 $170.00 $ 85.oo $ 75.00 Consultant agrees that all charges for the legal services hereunder, including expenses as set forth in Section 1II. C. below, shall not exceed $50,000.00. The Consultant shall endeavor to have the attorneys and employees listed in Section m.A. above, reasonably attempt to reduce costs by utilizing other qualified shareholders, associates, and paralegals wherever feasible or possible. The Consultant shall bill the City through the submission of itemized invoices, statements, and other documentation, together with support data indicating the progress of the work and the services performed on the basis of monthly statements, showing hourly rates indicating who performed the work, what type of work was done, and descriptions and/or details of all services rendered, including a daily, and an entry-by-entry reflection of billable time spent on this engagement, along with specific descriptions and supporting documentation, if available, respecting any reasonable and necessary out-of-pocket expenses incurred by Consultant in performing the professional services provided for under this Agreement. Professional fees shall be billed in minimum one-tenth (1/10) hour increments. Additionally, the City shall either pay directly or reimburse the Consultant, as the case may be, for reasonable and necessary actual out-of-pocket expenses, including but not limited to, long-distance telephone, telecopier, reproduction, postage, overnight courier, and transportation and travel. All copies will be charged at the rate of fifteen cents ($. 15) per copy for copies made within Consultant's offices, with as much photocopying as possible being done by outside vendors at bulk rates or by the City to reduce costs if bulk copying is necessary or appropriate. The parties agree that the charges for outgoing telecopies from Consultant shall be $.25 per page and that there wilt be no charge for incoming telecopies. The parties anticipate that invoices or statements for professional services will be generated on a monthly basis and that said invoices or statements will be sent to the City by Consultant on or about the 15th day of each month. The City shall make payment to the Consultant within thirty (30) days after receipt of an appropriate 10602 l~Denton Agreement Pag¢ 3 IV. A. itemized invoice or statement. To the extent that any fees or expenses are disputed by the City, the City shall notify Consultant within thirty (30) days after its receipt of the invoice or statement, and shall otherwise pay all undisputed amounts set forth in the invoice or statement within thirty (30) days after its receipt of the invoice or statement. All reimbursable expenses, including, but not necessarily limited to travel, lodging, and meals, shall be paid at the actual cost, pursuant to the terms, conditions, and limitations set forth herein. All invoices or statements, shall be a reviewed by the Director of Denton Municipal Electric, or her designee; and shall be reviewed and approved by the Assistant City Attorney/Utilities. It is understood and agreed that the Consultant shall work under the coordination and general supervision of the Director of Denton Municipal Electric, or her designee. All notices, invoices, statements, and payments shall be made in writing and may be given by personal delivery or by mail. As to notices: to Michael Conduff, City Manager, City of Dentonl 215 East McKinney, Denton, Texas 76201 or to his designee. As to invoices, statements, or payments: to Michael S. Copeland, Assistant City Attorney/Utilities, Utility Administration Department, at the same address, as to the City; and to Lambeth Townsend, Lloyd/Gosselink, 111 Congress Avenue, Suite 1800, Austin, Texas 78701, as to the Consultant. When so addressed, the notice, invoice, statement and/or payment shall be deemed given upon deposit of same in the U. S. Mail, postage prepaid. In all other instances, notices, invoices, statements, and/or payments shall be deemed given at the time of actual delivery. Changes may be made in the names and addresses of the responsible person or office to which notices, invoices, statements and/or payments are to be sent, provided reasonable notice is given. Professional Competency: Consultant agrees that in the performance of these professional services, Consultant shall be responsible to the level of competency and shall use the same degree of skill and care presently maintained by other practicing professionals performing the same or similar types of work. For the purpose of this Agreement, the key persons who will be performing most of the work hereunder shall be Lambeth Townsend and Georgia Crump, Shareholders, and Melissa E. Ramirez, Associate. However, nothing herein shall limit Consultant from using other qualified and competent members of the firm to perform the services required herein if such delegation is reasonably appropriate and properly protects the City's interests. Any agreements, ordinances, notices, instruments, memoranda, reports, letters, and other legal documents prepared or obtained under the terms of this Agreement are instruments of service and the City shall retain ownership and a property interest therein. If this Agre. ement is terminated at any time for any reason prior to payment to the Consultant for work under this Agreement, all such documents prepared or obtained under the terms of the Agreement shall upon termination be 106021~Dcnton Agreement Page 4 delivered to and become the property of the City upon request and without restriction on their use or further compensation to the Consultant. V. Establishment and Maintenance of Records: Full and accurate records shall be maintained by the Consultant at its place of business with respect to all matters covered by this Agreement. Such records shall be maintained for a period of at least three years after receipt of final payment under this Agreement. VI. Audits and Inspection: At any time during normal business hours and upon reasonable notice to the Consultant, there shall be made available to the City all of the Consultant's records with respect to all matters covered by this Agreement. The Consultant shall permit the City to audit, examine, and make excerpts or transcripts l~om such records, and to make audits of contracts, invoices, materials, and other data relating to all matters covered by this Agreement. VII. Accomplishment of Prolect: The Consultant shall commence, carry on, and complete this professional engagement with att practicable dispatch; in a sound, economical and efficient matter; and, in accordance with the provisions hereof and all applicable laws. In accomplishing the project, the Consultant shall take such steps as are appropriate to insure that the work involved is properly coordinated with any related work being carried on by the City. VIII. lndemniW and Independent Contractor Relationship: Consultant shall perform all services as an independent contractor not under the direct supervision and control of the City. Nothing herein shall be construed as creating a relationship of employer and employee between the parties. The City and Consultant agree to cooperate in the defense of any claims, action, suit, or proceeding of any kind brought by a third party which may result from or directly or indirectly arise from any negligence and/or errors or omissions on the part of the Consultant or from any breach of the Consultant's obligations under this Agreement. In the event of any litigation or claim under this Agreement in which Consultant is joined as a party, Consultant shall provide suitable counsel to defend City and Consultant against such claim, provided the Consultant shall have the right to proceed with the competent counsel of its own choosing. The Consultant agrees to defend, indemnify and hold harmless the City and all of its officers, agents, servants, and employees against any and all such claims to the extent of coverage by Consultant's professional liability policy. The Consultant agrees to pay all expenses, including but not limited to attorney's fees, and satisfy all judgments that may be incurred or rendered against the Consultant's professional liability insurance policy. Nothing herein constitutes a waiver of any rights or remedies the City may have to pursue under either law or equity, including, without limitation, a cause of action for specific performance or for damages, a loss to the City, resulting from Consultant's negligent errors or omissions, or breach of contract, and all such rights and remedies are expressly reserved. Consultant shall maintain and shall be caused to be in fome at all times during the term of this Agreement, a legally binding policy of.professional liability insurance, 106021XDenton Agreement Page 5 listed by Best Rated Carders, with a rating of"A-" or above, issued by an insurance carder approved to do business in Texas by the State Insurance Commission. Such coverage shall cover any claim hereunder occasioned by the Consultant's negligent professional act and/or error, act, or omission, in an mount not less than $1,000,000 combined single limit coverage per occurrence. In the event of change or cancellation of the policy by the insurer, the Consultant hereby covenants to immediately notify the City in writing thereof; and in such event, the Consultant shall, prior to the effective date of change or cancellation, serve a substitute policy fumishing the same or higher amount of coverage. The Consultant shall provide a copy of the declarations page of such policy to the City through its Director of Denton Municipal Electric simultaneously with the execution of this Agreement. IX. A. Termination of Agreement: In connection with the work outlined in this Agreement, it is agreed and fully understood by the Consultant that the City may cancel or indefinitely suspend further work hereunder or terminate this Agreement at any time upon written notice to Consultant, Consultant shall cease all work and labor being performed under this Agreement. Consultant may terminate this Agreement by giving the City fifteen (15) days written notice that Consultant is no longer in a position to continue representing the City. Consultant shall invoice the City for all work satisfactorily completed and shall be compensated in accordance with the terms of this Agreement. All reports and other documents, or data, or work related to the project shall become the property of the City upon termination of this Agreement. This Agreement may be terminated in whole or in part, in writing, by either party in the event of substantial failure by the other party to fulfill its obligations under this Agreement through no fault of the terminating party. Provided, however, that no such termination may be affected, unless the other party is given [1] written notice (delivered by certified mail, return receipt request) of intent to terminate, and not less than thirty (30) calendar days to cure the failure; and, [2] an opportunity for consultation with the temfinating party phor to termination. Nothing contained herein or elsewhere in this Agreement shall require the City to pay for any work which is unsatisfactory or which is not submitted in compliance with the terms of this Agreement. X. Alternate Dispute Resolution: The Consultant agrees that, if necessary, it will use its best efforts to resolve any disputes regarding the Agreement through the use of mediation or other forms of alternate dispute resolution set forth in Chapter 154 of the Texas Civil Practices and Remedies Code (V.A.T.C.S.). XI. Entire Aereement: This Agreement represents the entire agreement and understanding between the parties and any negotiations, proposals, or oral agreements are intended to be integrated herein and to be superseded by this written Agreement. Any supplement or 10602 IX,Denton Agreement Page 6 amendment to this Agreement, in order to be effective, shall be in writing and signed by the City and the Consultant. XII. Compliance with Laws: The Consultant shall comply with all federal, state, local laws, mles, regulations, and ordinances applicable to the work covered hereunder as they may now read or hereafter be amended, including but not limited to the Texas Disciplinary Rules of Professional Conduct. XIII. Governine Law: For the purpose of determining place of agreement and law governing same, this Agreement is entered into in the City and County of Denton, State of Texas, and shall be construed in accordance with, and governed by the laws of the State of Texas. Venue and jurisdiction of any suit or cause of action arising under or in connection with this Agreement shall lie exclusively in a court of competent jurisdiction sitting in Denton County, Texas. XIV. Discrimination Prohibited: In performing the services required hereunder, the Consultant shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap. XV. Personnel: Consultant represents that it has or will secure at its own expense all personnel required to perform the services required under this Agreement. Such personnel shall not be employees nor have any contractual relations with the City. Consultant shall inform the City of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement, in accordance with Consultant's responsibilities under the Texas Disciplinary Rules of Professional Conduct. Bo All services required hereunder will be performed by the Consultant or under its direct supervision. All personnel engaged in work shall be qualified and shall be licensed, authorized, or permitted under state and local laws to perform such services. XVI. Assi~nabili _ty: The Consultant shall not assign any interest in tiffs Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation, or otherwise) without the prior written consent of the City thereto. XVII. Severability: All agreements and covenants contained herein are severable, and in the event any of them, with the exception of those contained in sections headed "Scope of Services", "Independent Contractor Relationship", and "Compensation and Method of Payment" hereof, shall be held to be invalid by any court of competent jurisdiction, this Agreement shall be interpreted as though such invalid agreements or covenants were not contained herein. XVIII. Responsibilities for Claims and Liabili .ty:. Approval by the City shall not constitute nor be deemed a release of the responsibility and liability of the Consultant for the accuracy and competency of its work; nor shall such approval be deemed to be an assumption of such responsibility of the City for any defect in any report or other documents prepared by the 10602 l~Denton Agreement Page 7 'Consultant, its shareholders, associates, employees, officers, or agents in connection with this engagement. XIX. Modification of Aereement: No waiver or modification of this Agreement or of any covenant, condition, or limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith. No evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting this Agreement, or the fights or obligations of the parties hereunder, unless such waiver or modification is in writing, duly executed as aforesaid. The parties further agree that the provisions of this article will not be waived as herein set forth. XX. C_..qptions: The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement. XXI. Binding Effect: This Agreement shall be binding upon and inure to the benefit.of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors, and assigns, where permitted by this Agreement. IN WITNESS HEREOF, the City of Denton, Texas has executed this Agreement in four (4) original counterparts by and through its duly authorized City Manager; and Consultant has executed this Agreement by and through its duly authorized undersigned Shareholder; dated this the day of ,2003. CITY OF DENTON, TEXAS A Texas Municipal Corporation By: Michael A. Conduff, City Manager ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY 10602 lkDcnton Agreement Page 8 LLOYD, GOSSELINK, ROCHELLE, BLEVINS ROCHELLE, BALDWIN & TOWNSEND, P.C. A Texas Professional Corporation By: ~e~Townsend, Shareholder ATTEST: 10602 l~Denton Agreement Page 9 LlcP~,, GoaaeZ:Ll:dc~ POT~C/'I~g]O:OD~ 05/01/~00] ~'0 05/01/2004 COVERA~ i ~ AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Electric Utility Howard Martin, 349-8232 SUBJECT: AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES WITH LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING THE PROTECTION OF THE CITY'S INTERESTS RELATING TO COMPETITION TRANSITION CHARGES AND TRANSITION CHARGES BY MUNICIPALLY OWNED UTILITIES OR BY CUSTOMERS OF MUNICIPALLY OWNED UTILITIES; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTIVE DATE. BACKGROUND: Senate Bill 7, the Texas electric retail deregulation bill, contains provisions that specify the manner in which electric utilities serving customers in Texas prior to implementation of retail deregulation can determine and recover their "stranded" investment in generation facilities from customers. "Stranded" investment is the difference between the book value of generation facilities built by electric utilities to serve their customers under a regulated environment and the market value of those same plants in a deregulated environment. For private electric utilities, the TPUC determines the amount of "stranded" generation investment a company is entitled to recover. Once that determination is made, the utilities are allowed to go to the financial market and issue bonds in the amount of that stranded investment, thus returning the funds to the utility for use in other business investments. The bonds are repaid over time through collection of a CTC charge placed on the bills of all customers who were connected to the distribution or transmission system of the subject electric utility prior to May 1, 1999. This process is referred to as securitization of stranded costs because the collection of the CTC from customers for repayment of the bonds is guaranteed by the State of Texas through tariffs issued by the TPUC ordering the collection of the CTC from customers. TXU has completed the process of TPUC determination of the amount of "stranded" investment it is entitled to recover, the PUC has issued the associated orders and tariffs, and TXU is in the process of issuing the bonds. No municipal or cooperative electric utility intervened in that proceeding because there was nothing in the notice of the proceeding that indicated it would have any impact on municipals or cooperatives. Subsequent to the completion of the proceedings, TXU notified several municipals and cooperatives, including DME, that the tariff issued by the TPUC required that they be responsible for collection of the TXU CTC charge from any customers who were being served by TXU prior to May 1, 1999 but who had switched their connection to the wires of a municipal or cooperative after May 1, 1999. Furthermore, the tariff required the impacted municipals to provide the consumption data for those customers to TXU and to pay the subject CTC charges to TXU regardless of whether they were successful in collecting those charges from the impacted customers. While the number of DME customers impacted and the dollar amount of the charges is small, there are several problems with this process. First, other parts of Texas law require that the consumption data of customers remain confidential unless a customer agrees for their data to be released. Second, the Texas Constitution forbids a municipal corporation from making either an appropriation or a donation to a private company without receiving value in return (i.e. buying goods or services). Third, attempting to collect such a charge form DME customers could easily harm DME's relationship with that customer. Fourth, DME obviously does not wish to be burdened with paying any portion of TXU's costs. Clearly, the precedent accepting such a process would set is not legal or acceptable. Several municipals and cooperatives, including DME, attempted to negotiate a compromise with TXU on the issue. We offered to provide TXU with the customer consumption data they required (subject to receiving the legal authority to provide that confidential data) but to place the burden of billing for and recovering those charges from the customers on TXU. TXU would not consider that offer and filed a complaint with the TPUC seeking to have the TPUC compel compliance with the tariff that it has issued. The same municipals and cooperatives filed a request for a rulemaking based on our proposed compromise. The Lloyd, Gosselink firm represented DME in the actions taken in this case thus far under the general Regulatory Services Agreement DME maintains with the firm for dealing with small regulatory and legal issues that arise from time to time. Since it has now become clear that this issue has developed into a specific formal regulatory proceeding that could ultimately result in an appeal to the courts, it is appropriate to set up an individual agreement and associated purchase orders rather than continue this work under the general Regulatory Services Agreement that is maintained with the Lloyd, Gosselink firm. OPTIONS: None. RECOMMENDATIONS: DME Recommends approval of this Agreement. PRIOR ACTION/REVIEW (Council, Boards, Commission): The Public Utilities Board will consider this item at its August 18~h, 2003 meeting. recommendation will be provided to Council at the August 19~h City Council meeting. FISCAL INFORMATION: The cost of this Agreement is not to exceed $45,000. EXHIBITS: 1. Ordinance 2. Agreement Respectfully submitted, Sharon Mays Director of Electric Utility Their ORDINANCE NO. 2003- AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES WITH LLOYD, GOSSEL1NK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING THE PROTECTION OF THE CITY'S INTERESTS RELATING TO COMPETITION TRANSITION CHARGES AND TRANSITION CHARGES BY MUNICIPALLY OWNED UTILITIES OR BY CUSTOMERS OF MUNICIPALLY OWNED UTILITIES; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council deems that it is in the public interest to engage the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas (the "Firm") to provide professional legal services to the City of Denton, Texas ("City") pertaining to representation of the City and Denton Municipal Electric ("DME") before the Public Utility Commission of Texas ("PUC") in the areas of public utilities regulatory law and administrative law; relating to the payment of Competition Transition Charges ("CTCs") and Transition Charges ("TCs") by municipally owned utilities, or by customers of municipally owned utilities, including representation of the City at PUC Project No. 27837 ("Petition of Texas Electric Cooperatives, Inc., et al Requesting Adoption of a New Rule Regarding Billing and Collection of Transition"); and in Docket No. 27891 ("Complaint of Oncor Electric Delivery Company Against Certain Cooperatives and Municipal Utilities and Petition for Enforcement of Financing Order"); and any future projects or dockets at the PUC relating to the payment of CTCs or TCs by municipally owned utilities or their customers; and WHEREAS, the City staff has reported to the City Council that there is a substantial need for the above-referenced professional legal services, and that limited City staff cannot adequately perform the specialized services and tasks which are primarily centered in Austin, Texas, with its own personnel; and WHEREAS, the City has heretofore engaged the Firm by numerous previous Agreements for Professional Legal Services to perform similar services to those services provided for in the Agreement for Professional Legal Services attached hereto. Further, that the Firm has performed and provided legal services benefiting the City under the most recent Agreement on a continuous and uninterrupted basis, in order to safeguard and represent the interests of the City and DME before the PUC, in dealing with sudden, largely unpredictable events and developments, and with administrative deadlines that many times require immediate attention or response. Accordingly, it is appropriate that the new Agreement for Professional Legal Services by and between the City and the Firm attached hereto, should be ratified and confirmed, and should be retroactively approved and made effective as of July 1, 2003, in order to properly compensate the Firm for its work that has already directly benefited the City, and which work was done at the specific instance and request of the City; and 1 EXHIBIT 1 WHEREAS, Chapter 2254 of the Texas Government Code, known as the "Professional Services Procurement Act", generally provides that a City may not select a provider of professional services on the basis of. competitive bids, but must select the provider on the basis of demonstrated competence, knowledge, and qualifications, and for a fair and reasonable price; and the Council hereby finds and concludes that the Firm is appropriately qualified under the provisions of that law to be retained as outside legal counsel for the City and DME respecting this engagement; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1: That the recitations set forth and contained in the foregoing preamble are expressly incorporated by reference into this Ordinance. SECTION2: That the City Manager is hereby authorized to execute an Agreement for Professional Legal Services by and between the City and the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas, in substantially the form of the Agreement for Professional Legal Services attached hereto and incorporated herewith by reference. SECTION 3: That the award of this Agreement by the City is on the basis of the demonstrated competence, knowledge, and qualifications of the Firm and the ability of the Firm to perform the services needed by the City for a fair and reasonable price. SECTION 4: That the expenditure of funds as provided in the attached Agreement for Professional Legal Services is hereby authorized. SECTION 5: That the above and foregoing Agreement for Professional Legal Services is hereby ratified, confirmed, and retroactively approved, and shall be effective from and after July 1, 2003. SECTION6: That except as otherwise provided in Section 5 above, this Ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ., 2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY EULINE BROCK, MAYOR By: 2 APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: S:\Our Documents\Ordinances\03\Lloyd Gosselink-Project No, 27837 et al-CTC-TC-Municipal Electric Utilities Ord.doc STATE OF TEXAS § COUNTY OF DENTON § AGREEMENT FOR PROFESSIONAL LEGAL SERVICES THIS AGREEMENT, made and entered into this __ day of ., 2003, by and between LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., a Texas Professional Corporation (hereinafter "Consultant"), with Lambeth Townsend, Shareholder, having full authority to execute this Agreement on behalf of thc firm, 111 Congress Avenue, Suite 1800, Austin, Texas, 78701; and the CITY OF DENTON, a Texas Municipal Corporation, 215 E. McKinney, Denton, Texas, 75201 (hereinafter "City"), with Michael Conduff, City Manager, having full authority to execute this Agreement on behalf of the City. WITNESSETH: WHEREAS, the City deems it necessary and in the public interest to employ legal counsel to provide professional legal services with respect to protection of the City's interests relating to the payment of Competition Transition Charges ("CTCs") and Transition Charges ("TCs") by municipally owned utilities such as the City, or by customers of municipally owned utilities, including the representation of the City at the Public Utility Commission of Texas ("PUC") in Project No. 27837, Petition of Texas Electric Cooperatives, Inc., et al. Requesting Adoption of a New Rule regarding Billing and Collection of Transition Charges and Competition Transition Charges from Customers in Multiply Certificated Area of Electric Utilities, Electric Cooperatives, and Municipally Owned Utilities and in Docket No. 27891, Complaint of Oncor Electric Delivery. Company Against Certain Cooperatives and Municipal Utilities and Petition for Enforcement of Financing Order, and in any future projects or dockets at the PUC relating to the payment of CTCs or TCs by municipally owned utilities or their customers; and WHEREAS, the Consultant is willing to perform such services in a professional manner as an independent contractor; and has competently and efficiently performed similar services for the City in numerous other matters before the PUC over the past several years; and the City has selected Consultant on the basis of demonstrated competence and qualifications necessary to perform the needed services; and WHEREAS, the City desires to engage the Consultant to render the professional services in connection therewith, for a fair and reasonable price; consistent with, and for a fee not higher than the recommended practices and fees published by the applicable professional associations; and such fees do not exceed any maximum provided by law; ail in accordance with the provisions of Chapter EXHIBIT 2 106020'tDcnton Agrccmcnt Page 1 2254 of the Texas Government Code (the "Professional Services Procurement Act"); and the Consultant is willing to provide such services; NOW, THEREFORE, in consideration of the promises and mutual obligations herein, the City and Consultant do hereby mutually AGREE as follows, to wit: I. Scope of Services: The Consultant shall perform the following services in a professional manner working as an independent contractor not under the direct supervision and control of the City: A. Services to be provided: Consultant shall represent the City in Project No. 27837, Petition of Texas Electric Cooperatives, Inc., et al. Requesting Adoption of a New Rule regarding Billing and Collection of Transition Charges and Competition Transition Charges from Customers in Multiply Certificated Area of Electric Utilities, Electric Cooperatives, and Municipally Owned Utilities, in Docket No. 27891, Complaint of Oncor Electric Delivery Company Against Certain Cooperatives and Municipal Utilities and Petition for Enforcement of Financing Order, and in any related additional projects or dockets at the PUC involving the payment of CTCs or TCs by municipally owned utilities or their customers, including without limitation, the professional and legal services attendant to preparing and submitting comments, responding to requests for information, and attending all hearings and other proceedings in relationship to CTCs and TCs, and to consult with the City through its Denton Municipal Electric staff with regard to all filings, hearings, 'appeals, and other issues related to CTCs and TCs, and to assist in any subsequent actions in response to any. Commission final order concerning CTCs and TCs. To consult with the City Manager, the Assistant City Manager for Utilities, the Director of Denton Municipal Electric, the City Attorney, the Assistant City Attorney for Utilities, and/or other designated administrative personnel or staff regarding any and all aspects of the professional services to be performed, including legal research, analysis, and advice with respect to protecting the City's position regarding the payment of CTCs and TCs by municipally owned utilities or their customers, currently being reviewed by the PUC, or which the PUC undertakes to review in the future. This will include coordinating activities with the Director of Denton Municipal Electric, the City Attomey, and their respective staff to efficiently perform the services required and to preserve the Attorney/Client privilege, work product, and all other applicable exceptions to the discovery or disclosure of documents produced by the City and the Consultant under the Scope of Services hereinabove. 106020XDcnton Agreement Page 2 The Consultant shall perform all the services required by this Agreement in a'timely fashion, and shall complete them in compliance with schedules established by the City through its Director of Denton Municipal Electric as appropriate to can'y out the terms and conditions of this Agreement. II. Term: This Agreement shall be retroactively effective as of July 1, 2003. The Agreement shall terminate either upon the completion of the professional services provided for herein or upon the exhaustion of all professional fees provided for hereunder, whichever event shall first occur. This Agreement may be sooner terminated in accordance with the provisions hereof. Time is of the essence of this Agreement. Consultant shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible during the term of this Agreement, and to meet the schedules established by the City, through its Director of Denton Municipal Electric, or her designee. Iii. Compensation and Method of Payment: The Consultant shall charge the following fees for its professional services provided to the City hereunder, based upon the following hourly billing rates for the attorneys and support staff involved in this matter: Staff Hourly Rate Lambeth Townsend, Shareholder Georgia Crump, Shareholder Melissa E. Ramirez, Associate Paralegal Law Clerk $ 230.00 $210.00 $170.00 $ 85.OO $ 75.00 Consultant agrees that all charges for the legal services hereunder, including expenses as set forth in Section III. C. below, shall not exceed $45,000.00. The Consultant shall endeavor to have the attorneys and employees listed in Section III.A. above, reasonably attempt to reduce costs by utilizing other qualified shareholders, associates, and paralegals wherever feasible or possible. The Consultant shall bill the City through the submission of itemized invoices, statements, and other documentation, together with support data indicating the progress of the work and the services performed on the basis of monthly statements, showing hourly rates indicating who performed the work, what type of work was done, and descriptions and/or details of all services rendered, including a daily, and an entry-by-entry reflection of billable time spent on this engagement, along with specific descriptions and supporting documentation, if available, respecting any reasonable and necessary out-of-pocket expenses incurred by Consultant in performing the professional services provided for under this Agreement. Professional fees shall be billed in minimum one-tenth (1/10) hour increments. 106020~Dcnton Agreement Page 3 IV. A. Additionally, the City shaI1 either pay directly or reimburse the Consultant, as the case may be, for reasonable and necessary actual out-of-pocket expenses, including but not limited to, long-distance telephone, telecopier, reproduction, postage, overnight courier, and transportation and travel. All copies will be charged at the rate of fifteen cents ($.15) per copy for copies made within Consultant's offices, with as much photocopying as possible being done by outside vendors at bulk rates or by the City to reduce costs if bulk copying is necessary or appropriate. The parties agree that the charges for outgoing teleeopies from Consultant shall be $.25 per page and that there will be no charge for incoming telecopies. The parties anticipate that invoices or statements for professional services will be generated on a monthly basis and that said invoices or statements will be sent to the City by Consultant on or about the 15th day of each month. The City shall make payment to the Consultant within thirty (30) days after receipt of an appropriate itemized invoice or statement. To the extent that any fees or expenses are disputed by the City, the City shall notify Consultant within thirty (30) days after its receipt of the invoice or statement, and shall otherwise pay all undisputed amounts set forth in the invoice or statement within thirty (30) days after its receipt of the invoice or statement. Ali reimbursable expenses, including, but not necessarily limited to travel, lodging, and meals, shall be paid at the actual cost, pursuant to the terms, conditions, and limitations set forth herein. All invoices or statements shall be a reviewed by the Director of Denton Municipal Electric, or her designee; and shall be reviewed and approved by the Assistant City Attorney/Utilities. It is understood and agreed that the Consultant shall work under the coordination and general supervision of the Director of Denton Municipal Electric, or her designee. All notices, invoices, statements, and payments shall be made in writing and may be given by personal delivery or by mail. As to notices: to Michael Conduff, City Manager, City of Denton, 215 East McKinney, Denton, Texas 76201 or to his designee. As to invoices, statements, or payments: to Michael S. Copeland, Assistant City Attorney/Utilities, Utility Administration Department, at the same address, as to the City; and to Lambeth Townsend, Lloyd/Gosselink, 111 Congress Avenue, Suite 1800, Austin, Texas 78701, as to the Consultant. When so addressed, the notice, invoice, statement and/or payment shall be deemed given upon deposit of same in the U. S. Mail, postage prepaid. In all other instances, notices, invoices, statements, and/or payments shall be deemed given at the time of actual delivery. Changes may be made in the names and addresses of the responsible person or office to which notices, invoices, statements and/or payments are to be sent, provided reasonable notice is given. Professional Comoeten~.' Consultant agrees that in the performance of these professional services, Consultant shall be responsible to the level of competency and shall use the same degree of skill 106020kDcnton Agreement Page 4 and care presently maintained by other practicing professionals performing the same or similar types of work. For the purpose of this Agreement, the key persons who will be performing most of the work hereunder shall be Lambeth Townsend and Georgia Cramp, Shareholders, and Melissa E. Ramirez, Associate. However, nothing herein shall limit Consultant from using other qualified and competent members of the firm to perform the services required herein if such delegation is reasonably appropriate and properly protects the City's interests. Any agreements, ordinances, notices, instruments, memoranda, reports, letters, and other legal documents prepared or obtained under the terms of this Agreement are instruments of service and the City shall retain ownership and a property interest therein. If this Agreement is terminated at any time for any reason prior to payment to the Consultant for work under this Agreement, all such documents prepared or obtained under the terms of the Agreement shall upon termination be delivered to and become the property of the City upon request and without restriction on their use or further compensation to the Consultant. V. Establishment and Maintenance of Records: Full and accurate records shall be maintained by the Consultant at its place of business with respect to all matters covered by this Agreement. Such records shall be maintained for a period of at least three years after receipt of final payment under this Agreement. VI, Audits and Inspection: At any time during normal business hours and upon reasonable notice to the Consultant, there shall be made available to the City all of the Consultant's records with respect to ali matters covered by this Agreement. The Consultant shall permit the City to audit, examine, and make excerpts or transcripts fi.om such records, and to make audits of contracts, invoices, materials, and other data relating to all matters covered by this Agreement. VII. Accomplishment of Proiect: The Consultant shall commence, carry on, and complete this professional engagement with ali practicable dispatch; in a sound, economical and efficient matter; and, in accordance with the provisions hereof and all applicable Iaws. In accomplishing the project, the Consultant shall take such steps as are appropriate to insure that the work involved is properly coordinated with any related work being carded on by the City. VIII. Indemnity and Independent Contractor Relationship: Consultant shall perform all services as an independent contractor not under the direct supervision and control of the City. Nothing herein shall be construed as creating a relationship of employer and employee between the parties. The City and Consultant agree to cooperate in the defense of any claims, action, suit, or proceeding of any kind brought by a third party which may result fi.om or directly or indirectly arise from any negligence and/or errors or omissions on the part of the Consultant or from any breach of the Consultant's obligations under this Agreement. In the event of any litigation or claim under this Agreement in which Consultant is joined as a party, Consultant shall provide suitable counsel to defend City and Consultant against such claim, provided the Consultant shall have the right 106020~Dcnton Agreement Page 5 IX. A. Bo to proceed with the competent counsel of its own choosing. The Consultant agrees to defend, indemnify and hold harmless the City and all of its officers, agents, servants, and employees against any and all such claims to the extent of coverage by Consultant's professional liability policy. The Consultant agrees to pay all expenses, including but not limited to attorney's fees, and satisfy all judgments that may be incurred or rendered against the Consultant's professional liability insurance policy. Nothing herein constitutes a waiver of any fights or remedies the City may have to pursue under either law or equity, including, without limitation, a cause of action for specific performance or for damages, a loss to the City, resulting from Consultant's negligent errors or omissions, or breach of contract, and all such fights and remedies are expressly reserved. Consultant shall maintain and shall be caused to be in force at all times during the term of this Agreement, a legally binding policy of professional liability insurance, listed by Best Rated Carders, with a rating of"A-" or above, issued by an insurance cartier approved to do business in Texas by the State Insurance Commission. Such coverage shall cover any claim hereunder occasioned by the Consultant's negligent professional act and/or error, act, or omission, in an amount not less than $1,000,000 combined single limit coverage per occurrence. In the event of change or cancellation of the policy by the insurer, the Consultant hereby covenants to inunediately notify the City in writing thereof; and in such event, the Consultant shall, prior to the effective date of change or cancellation, serve a substitute policy furnishing the same or higher amount of coverage. The Consultant shall provide a copy of the declarations page of such policy to the City through its Director of Denton Municipal Electric simultaneously with the execution of this Agreement. Termination of Agreement: In com~ecfion with the work outlined in this Agreement, it is agreed and fully understood by the Consultant that the City may cancel or indefinitely suspend further work hereunder or terminate this Agreement at any time upon written notice to Consultant, Consultant shall cease all work and labor being performed under this Agreement. Consultant may terminate this Agreement by giving the City fifteen (15) days written notice that Consultant is no longer in a position to continue representing the City. Consultant shall invoice the City for all work satisfactorily completed and shall be compensated in accordance with the terms of this Agreement. All reports and other documents, or data, or work related to the project shall become the property of the City upon termination of this Agreement. This Agreement may be terminated in whole or in part, in writing, by either party in the event of substantial failure by the other party to fulfill its obligations under this Agreement through no fault of the terminating party. Provided, however, that no such termination may be affected, unless the other party is given [1] written notice (delivered by certified mail, return receipt request) of intent to terminate, and not less than thirty (30) calendar days to cure the failure; and, [2] an opportunity for consultation with the terminating party prior to termination. 106020LDenton Agreement Page 6 Nothing contained herein or elsewhere in this Agreement shall require the City to pay for any work which is unsatisfactory or which is not submitted in compliance with the terms of this Agreement. X. Alternate Dispute Resolution: The Consultant agrees that, if necessary, it will use its best efforts to resolve any disputes regarding the Agreement through the use of mediation or other forms of altemate dispute resolution set forth in Chapter 154 of the Texas Civil Practices and Remedies Code (V.A.T.C.S.). XI. ~Entire A~reement: This Agreement represents the entire agreement and understanding between the parties and any negotiations, proposals, or oral agreements are intended to be integrated herein and to be superseded by this written Agreement. Any supplement or amendment to this Agreement, in order to be effective, shall be in writing and signed by thc City and the Consultant. XII. Compliance with Laws: The Consultant shall comply with all federal, state, local laws, rules, regulations, and ordinances applicable to the work covered hereunder as they may now read or hereafter be amended, including but not limited .to the Texas Disciplinary Rules of Professional Conduct. XIII. Governine Law: For the purpose of determining place of agreement and law governing same, this Agreement is entered into in the City and County of Denton, State of Texas, and shall be construed in accordance with, and governed by the laws of the State of Texas. Venue and jurisdiction of any suit or cause of action arising under or in connection with this Agreement shall lie exclusively in a court of competent jurisdiction sitting in Denton County, Texas. XIV. Discrimination Prohibited: In performing the services required hereunder, the Consultant shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap. XV. Personnel: Consultant represents that it has or will secure at its own expense all personnel required to perform the services required under this Agreement. Such personnel shall not be employees nor have any contractual relations with the City. Consultant shall inform the City of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement, in accordance with Consultant's responsibilities under the Texas Disciplinary Rules of Professional Conduct. All services required hereunder will be performed by the Consultant or under its direct supervision. All personnel engaged in work shall be qualified and shall be licensed, authorized, or permitted under state and local laws to perform such services. 106020X~)cnton Agreement Page 7 XVI. Assienability: The Consultant shall not assign any interest in this Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation, or otherwise) without the prior written consent of the City thereto. XVII. Severabilit~.' All agreements and covenants contained herein are severable, and in the event any of them, with the exception of those contained in sections headed "Scope of Services", "Independent Contractor Relationship", and "Compensation and Method of Payment" hereof, shall be held to be invalid by any court of competent jurisdiction, this Agreement shall be interpreted as though such invalid agreements or covenants were not contained herein. XVIII. Responsibilities for Claims and Liability: Approval by the City shall not constitute nor be deemed a release of the responsibility and liability of the Consultant for the accuracy and competency of its work; nor shall such approval be deemed to be an assumption of such responsibility of the City for any defect in any report or other documents prepared by the Consultant, its shareholders, associates, employees, officers, or agents in connection with this engagement. XIX. Modification of Agreement:. No waiver or modification of this Agreement or of any covenant, condition, or limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith. No evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting tiffs Agreement, or the fights or obligations of the parties hereunder, unless such waiver or modification is in writing, duly executed as aforesaid. The parties further agree that the provisions of this article will not be waived as herein set forth. XX. Captions.'. The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement. XXI. Bindine Effect: This Agreement shall be binding upon and inure to the benefit.of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors, and assigns, where permitted by this Agreement. IN WITNESS HEREOF, the City of Denton, Texas has executed this Agreement in four (4) originaI counterparts by and through its duly authorized City Manager; and Consultant has executed this Agreement by and through its duly authorized undersigned Shareholder; dated this the day of ., 2003. CITY OF DENTON, TEXAS A Texas Municipal Corporation By: Michael A. Conduff, City Manager 106020~Denton Agreement Page 8 ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: ATTEST: LLOYD, GOSSELINK, ROCHELLE, BLEVINS ROCHELLE, BALDWIN & TOWNSEND, P.C. A Texas Professional Corporation 106020~Dcnton Agreement Page 9 __APK, B. 2003_ 2:5§PM_ LOCK, ION COMPANIES NO. 6208 ~- INSU~N~ BINDER , o,,~'~ T.,Oe. kCo~ 'r~,,= ~ OE D~.lu 717 .~. ~a.~'tmo~, ~ ~ 27 ~ ~ 75201 ~ ~01 111 ~s= X~ ~Ce 1800 05/01/2003 ~ 05/01/200& i ACOSta 7'~.,-~i AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Electric Utility Howard Martin, 349-8232 SUBJECT: AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES WITH LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING THE PROTECTION OF THE CITY'S INTERESTS RELATING TO EFFORTS BY THE PUBLIC UTILITY COMMISSION OF TEXAS TO CHANGE THE CURRENT DESIGN OF THE ELECTRIC RELIABILITY COUNCIL OF TEXAS WHOLESALE POWER MARKET IN TEXAS; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTIVE DATE. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH R. J. COVINGTON CONSULTING, LLC FOR CONSULTING SERVICES RELATING TO TASK ORDER NO. 03-H, REGARDING THE MARKET DESIGN ISSUE OF MOVING THE ELECTRIC RELIABILITY COUNCIL OF TEXAS TO A NODAL TRANSMISSION PRICING SYSTEM, RELATING TO DENTON MUNICIPAL ELECTRIC; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. BACKGROUND: The Texas Legislature mandated a Texas wholesale electric market in which any generation resource can sell any amount of energy it desires to any load within Texas, regardless of the ability of the existing electric transmission system to handle the resulting energy flows on that transmission system. This inevitably results in periods during which specific transmission lines are loaded beyond their capacity to safety transport the energy, a condition referred to as transmission congestion. When this occurs, ERCOT is tasked by the TPUC with identifying new transmission projects that need to be constructed to relieve the congestion and local Transmission/Distribution Service Providers (TDSPs) are required to build the identified projects and recover those costs through filing with the TPUC for a Transmission Cost of Service (TCOS) rate that is uplifted to all customers in ERCOT through a uniform charge assessed on all TDSPs in ERCOT on a load ratio share. The TDSPs in turn pass these costs to customers through their wire use charges. There are three major flaws in this system. The first is that generators no longer have any incentive to build new facilities in locations where adequate transmission to support their project already exists because they do not have to pay for the cost of transmission upgrades caused by their project. Left unchecked, this process will ultimately result in Texas electric customers paying for an extremely expensive transmission system, raising the overall cost of electric energy in the state. The second is that completion of new transmission projects to relieve transmission congestion usually takes several years, in the interim some method must be used to ration the limited amount of transmission capacity among those desiring to use it. The third is that there are some areas where it will never be possible to build the additional transmission projects needed to relieve the congestion. The DFW metropolitan area is an example of such an area. It is virtually impossible, with any technology known today, to build several high voltage transmission lines and their associated support facilities (substations, etc.) into the heart of cities such as Dallas or Fort Worth. However, that is what is required in order to relieve the transmission congestion that exists today in those areas. In order to implement the Legislative mandates, the various market stakeholders in ERCOT developed a method to ration transmission capacity in constrained areas that was put into effect in 2001. The process identifies Commercially Significant Constraints (CSCs), which are defined as "a transmission constraint that limits the free flow of energy within the ERCOT market to a commercially significant degree". Generators are then grouped into Congestion Management Zones that are geographical areas defined such that each generator within the boundaries of the zone has a similar effect on the loading of the CSC transmission facilities between congestion zones. When a CSC becomes overloaded, ERCOT pays generators in the zone on one end of the overloaded CSC to reduce their output while simultaneously paying generators in the zone on the other side of the CSC to increase their output until the overload is relieved. The amount of the payments is usually determined through a bidding process. The cost of making these payments is then allocated to the entities whose schedules caused the original congestion. ERCOT also auctions off hedging rights on identified CSCs. The revenues from this auction then go to offset costs allocated to those who have bought the hedging rights for that CSC's congestion relief. However, not all transmission congestion occurs on CSC's. There is often transmission congestion on transmission lines within a Congestion Management Zone. This "local congestion" is usually caused by transmission system configurations that no longer adequately support the electric load growth in an area rather than by wholesale market activity. "Local congestion" congestion is not significant enough to be considered a CSC but it also must be relieved by raising and lowering generation of specified generating units and these generators are also both paid for that service. Under the present system, the cost of relieving "local congestion" is uplifted to all loads in ERCOT on a load ration share basis. The DFW area "North Zone" experiences a significant amount of "local congestion" for which there is little hope of relief from construction of new transmission or new generation. Close to $72 million of "local congestion" costs have been experienced in the DFW area this year alone. The TPUC, under what many believe is some amouN of influence from Pat Wood, former Chairman of the TPUC, now Chairman of the Federal Energy Regulatory Commission, has now decided that a different system of transmission management should be implemented in Texas. Some economists believe that this differeN type of system will provide some level of inceNive for generators to locate new projects in areas that do not cause transmission congestion. The system, referred to as Locational Marginal Pricing (LMP), is an extremely complex nodal pricing system that will be very expensive to implement. Some estimates have been as high as $300 million for all parts of the Texas market (ERCOT and stakeholders) to implemeN such a system. The portion of this cost to change the ERCOT system will be passed through to all loads in ERCOT, including the customers of DME. The success of this system in areas where it has been implemeNed has been questionable, especially when its costs are considered. However, despite consistent comments by a number of wholesale market stakeholders and consumers representatives questioning the wisdom of implementing such a system, the TPUC has pressed forward. This rush into an LMP type system has been made without adequate cost benefit analysis on the part of the TPUC. Furthermore, implementation of an LMP type system will result in the high DFW local congestion costs being allocated to only electric customers in the DFW area. As discussed above, DFW has almost no way to economically remove its local transmission congestion costs abseN some major, unforeseen technological breakthrough. Imposition of an LMP type system in ERCOT will made the DFW a much higher cost energy area than other parts of Texas, with the obvious negative impacts on DFW economic health and growth potential. The overall cost to DME customers of implementing an LMP type system combined with potentially large negative impact on the DFW area economy are of grave concern to DME. Through the use of the general Regulatory Service contracts DME maintains with both the Lloyd Gosselink firm and R .J. Covington Consulting and the efforts of DME staff, DME has actively participated in discussions of the issue both at ERCOT and the TPUC for the past year. Despite those efforts and the efforts of many other parties, the TPUC has refused to consider the many problems of implementing an LMP type system in Texas. The TPUC is about to order a very expedited year and a half design process intended to force an LMP system into Texas. DME is joining with a number of other groups such as the TMPA cities, two large Texas city aggregation groups, Retail Energy Providers, some consumer representatives, and possibly TXU in both actively participating in the design process and utilizing all available avenues to force the TPUC to perform a proper cost/benefit analysis prior to final adoption of an LMP type system for Texas. Active participation in the design process is necessary in order to do everything possible to see that, in the event an LMP type system is implemented, it that takes into consideration the needs of DME's customers (such as the ability to schedule power from the Gibbons Creek plan to DeNon without paying large transmission costs). Such active participation will require having representatives of DME attend meetings in Austin as often as two or three times a week, during the year and a half development process, as well as filing of formal comments at the TPUC. Additional regulatory, legal, and legislative efforts will also be required to ensure that the TPUC completes the proper analysis before mandating such a system. In order to maintain the necessary level of participation, the support of both the Lloyd Gosselink firm and R. J. Covington Consulting will be required. The Covington firm, which is located in Austin, can represent DME at many of the Austin market design meetings more cost effectively than having DME staff commute to Austin. Furthermore, DME does not have sufficient staff to both attend all the meetings and maimain day-to-day responsibilities. The Gosselink firm will assist in dealing with the TPUC at formal hearings and through filings in the various rulemaking proceedings that have been set up for the market design processes. It may also be necessary to utilize the courts if the TPUC continues to ignore its required due process in implementing this new market design. The Gosselink firm will coordinate those efforts. Garland is engaging these same firms for this effort, which will allow for cost sharing between Garland and DeNon. Since this has become a major project, it is appropriate to set up individual agreemems and the associated purchase orders rather than continue this work under the general Regulatory Services Agreements that are maintained with the Covington and Gosselink firms for miscellaneous issues that arise. OPTIONS: 1. Approve the Agreemem for Professional Services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C. and Task Order 03-H with R. J. Covington Consulting, LLC for support in the ongoing Texas Public Utility Commission (TPUC)/Electric Reliability Council of Texas (ERCOT) electric wholesale market design project. 2. Do not participate actively in the TPUC/ERCOT wholesale market design project. RECOMMENDATIONS: DME recommends approval of the Agreemem for Professional Services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C. and Task Order 03-H with R. J. Covington Consulting, LLC for support in the ongoing Texas Public Utility Commission (TPUC)/Electric Reliability Council of Texas (ERCOT) electric wholesale market design project. PRIOR ACTION/REVIEW (Council, Boards, Commission): The Public Utilities Board will consider this item at its August 18th, 2003 meeting. Their recommendation will be provided to Council at the August 19th City Council meeting. FISCAL INFORMATION: 1. Agreemem for Professional Services with Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C. not to exceed $45,000. 2. Task Order 03-H with R. J. Covington Consulting, LLC not to exceed not to exceed $87,000. EXHIBITS: 1. Ordinance pertaining to R. J. Covington Agreement 2. R.J. Covington Agreement 3. R.J. Covington Task Order 03-H 4. Ordinance pertaining to Lloyd Gosselink Agreement 5. Lloyd Gosselink Agreement Respectfully submitted: Sharon Mays Director of Electric Utilities ORDINANCE NO. 2003- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH R. J. COVINGTON CONSULTING, LLC FOR CONSULTING SERVICES RELATING TO TASK ORDER NO. 03-H, REGARDING THE MARKET DESIGN ISSUE OF MOVING THE ELECTRIC RELIABILITY COUNCIL OF TEXAS TO A NODAL TRANSMISSION PRICING SYSTEM, RELATING TO DENTON MUNICIPAL ELECTRIC; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council deems it in the public interest to engage the finn of R. J. Covington Consulting, LLC of Austin, Texas ("Covington"), to provide professional consulting services to the City relating to Task Order No. 03-H; which includes, without limitation, continuing participation in Public Utility Commission of Texas ("PUC") Project No. 26736 as well as spin-off projects; participation at the Electric Reliability Council of Texas ("ERCOT") committees and task forces; developing rules for implementing a nodal system; developing materials for lobbying the Texas Legislature to counter the PUC's efforts to implement a nodal market design, and related work; and WHEREAS, the City staffhas reported to the City Council that there is a substantial need for the above-described specialized professional services, and that limited City staff cannot adequately perform the services and tasks with its own personnel; and WHEREAS, Chapter 2254 of the Texas Government Code, known as the "Professional Services Procurement Act", generally provides that a City may not select a provider of professional services on the basis of competitive bids, but must select the provider on the basis of demonstrated competence, knowledge, and qualifications, and for a fair and reasonable price; and WHEREAS, Covington has represented DME continuously and ably over the past seven years, and has proven to be a valuable, affordable, competent, dependable professional resource that has expertise in and is well acquainted with the electric financial and regulatory framework of Denton Municipal Electric ("DME"). Covington and his staff are familiar with the characteristics and operations of DME; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the professional services, as set forth in the Professional Services Agreement; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1: That the City Manager is hereby authorized to execute a Professional Services Agreement with R. J. Covington Consulting, LLC of Austin, Texas, for professional consulting services relating to Task Order No. 03-H, to Denton Municipal Electric, in EXHIBIT 1 substantially the form of the Professional Services Agreement attached hereto and incorporated herewith by reference as Exhibit "A." SECTION 2: That the award of this Agreement by the City is on the basis of the demonstrated competence, knowledge, and qualifications of Covington and the ability of Covington to perform the professional services needed by the City for a fair and reasonable price. SECTION 3: That the expenditure of funds as provided in the attached Professional Services Agreement is hereby authorized. SECTION 4: That the above and foregoing Professional Services Agreement is hereby ratified, confirmed, and retroactively approved, and shall be effective from and after July 1, 2003. SECTION 5: That except as otherwise provided by Section 4 above, this ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ., 2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: S:\Our Documents\Ordinances\03XR J Covington Consulting LLC-DME-Ord Aprv TO-3-H 2003.doc 2 STATE OF TEXAS COUNTY OF DENTON PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES PERTAINING TO DENTON MUNICIPAL ELECTRIC THIS AGREEMENT is made and entered into as of the ~ day of August, 2003, by and between the City of Denton, a Texas Municipal Corporation, with its principal office at 215 East McKinney Street, Denton, Texas 76201 ("CITY"); and R. J. COVINGTON CONSULTING, LLC, A Texas Limited Liability Corporation, with its principal office at 13276 Research Blvd., Suite 201, Austin, Texas 78750, hereafter "COVINGTON"; acting herein by and through their duly authorized representatives. WITNESSETH, that in consideration of the covenants, promises and agreements herein contained, the CITY and COVINGTON do hereby AGREE as follows: ARTICLE l EMPLOYMENT OF CONSULTANT The CITY hereby contracts with COVINGTON, as an independent contractor, and COVINGTON hereby agrees to perform the services herein in connection with the Scope of Services as stated in the Articles to follow, with diligence and in accordance with the highest professional standards customarily obtained for such services in the State of Texas. ARTICLF. lq SCOPE OF SERVICES A. COVINGTON shall provide to the CITY professional consulting services pertaining to CITY'S position on the market design issue of moving the Electric Reliability Council of Texas ("ERCOT") to a nodal transmission pricing system. The scope of services includes continuing participation in Project No. 26736 at the Public Utility Commission of Texas ("PUC") and spin-off projects; participation at ERCOT on committees and task forces; developing roles for implementing a nodal system; developing materials for lobbying the Texas Legislature to counter the PUC'S efforts to implement a nodal market design, and related work. COVINGTON agrees to perform those services and tasks more particularly described in Task Order No. 03-H attached hereto and incorporated herewith by reference. B. To consult with the City Manager, Assistant City Manager/Utilities, the Director of Electric Utilities, the Utility Attomey, and any other designated administrative personnel regarding any and all aspects of the services to be performed pursuant to this Agreement. EXHIBIT 2 Page 1 ARTICI.E 111 PERIOD OF SERVICE This Agreement shall become retroactively approved, ratified and effective as of July 1, 2003, upon its execution by both the CITY and COVINGTON. The termination date of this Agreement shall be upon the earliest to occur of the following events: completion of the work described herein and in the attached Task Order No. 03-H; or upon the depletion and exhaustion of the $74,500 not to exceed amount provided for herein; or upon fifteen (15) day's written notice to terminate, issued by the Director of Electric Utilities, DME. This Agreement may be sooner terminated in accordance with the provisions hereof. Time is of the essence in this Agreement. COVINGTON shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible and to meet the schedule established by the CITY, acting through its Director of Electric Utilities. AR TIC. I,F~ 1V COMPENSATION Bo COMPENSATION TERMS: "Direct Non-Labor Expense" is defined as that expense for any assignment incurred hereunder by COVINGTON for supplies, long-distance telephone, telecopier, reproduction expense, ovemight courier, photocopy expense, transportation, travel, communications, subsistence and lodging away from home and similar incidental expenses reasonably incurred in connection with that assignment. BILLING AND PAYMENT: 1. For and in consideration of the professional services to be performed by COVINGTON herein, the CITY agrees to pay COVINGTON, a total fee, including reimbursement for direct non-labor expense, not to exceed $74,500 for those services described in Task Order No. 03- H. 2. The fee for the services described in this Agreement to be performed by COVINGTON are to be billed the rates as set forth in Exhibit "A" attached hereto and incorporated herewith by reference. Billing shall be reported in minimum one-quarter (1/4) hour increments. 3. Payments to COVINGTON will be made by the C1TY on the basis of detailed monthly statements rendered to the CITY through its Director of Electric Utilities. The fee bills as submitted~ shall be allowed and approved by the Director of Electric Utilities. However, under no circumstances shall any monthly statement for services exceed the value of the work performed at the time a statement is rendered. 4. Nothing contained in this Article shall require the CITY to pay for any work which is unsatisfactory as reasonably determined by the City Manager or the Director of Electric Utilities, or which is not submitted in compliance with the terms of this Agreement. The City Page 2 shall not be required to make any payments to COVINGTON when COVINGTON is in default under this Agreement. 5. It is specifically understood and agreed that COVINGTON shall not be authorized to undertake any work pursuant to this Agreement which would require additional payments by the CITY for any charge, expense or reimbursement above the maximum not-to-exceed fee as stated, without first having obtained written authorization from the CITY. C. PAYMENT If the CITY fails to make payments due COVINGTON for services and expenses within forty (40) days after receipt of COVINGTON'S undisputed statement thereof, the amounts due COVINGTON will be increased by the rate of one percent (1%) per month fi:om the said forty (40th) day, and in addition, COVINGTON may, after giving ten (I0) days' written notice to the CITY, suspend services under this Agreement until COVINGTON has been paid in full all amounts due for services, expenses and charges provided. However, nothing herein shall require the CITY to pay the late charge of one percent (1%) set forth herein if the CITY reasonably determines that the work of COVINGTON is unsatisfactory, in accordance with this Article IV, Compensation, and the CITY notifies COVINGTON in writing of any such defect. ARTICI,F, V OBSERVATION AND REVIEW OF THE WORK COVINGTON will exercise reasonable care and due diligence in discovering and promptly reporting to the CITY any defects or deficiencies in his work or the work of any subconsultants performed hereunder. ARTICI.F. VI OWNERSHIP OF DOCUMENTS All documents, analyses and other data prepared by COVINGTON under this Agreement ("Work Products") are instruments of service and are and shall remain the property of CITY. COVINGTON shall have the right to make and retain copies and use all Work Products; provided, however, the use shall be limited to the intended use for which the services and Work Products are provided under this Agreement. COVINGTON may use and may copyright certain non-sensitive Work Products as property of COVINGTON; provided that prior written approval is obtained from CITY, whose approval shall not be unreasonably withheld, and providing that copywriting will not restrict CITY'S right to retain or make copies of the Work Products for its information, reference and use on the Project or services under the Agreement. Page 3 The Work Products shall not be changed or used for purposes other than those set forth in this Agreement without the prior written approval of COVINGTON. If CITY releases the Work Products to a third party without COVINGTON'S prior written consent, or changes or uses the Work Products other than as intended hereunder, CITY does so at its sole risk and discretion and COVINGTON shall not be liable for any claims or damages resulting from or connected with the release or any third party's use of the Work Products. 'ARTTCI J~. VII INDEPENDENT CONTRACTOR COVINGTON shall provide services to the CITY as an independent contractor, not as an employee of the CITY. COVINGTON shall not have or claim any fight arising from employee status. ARTIC. I.F, INDEMNITY AGREEMENT COVINGTON shall indemnify and save and hold harmless the CITY and its officers, agents, and employees from and against any and ail liability, claims, demands, damages, losses and expenses, including but not limited to court costs and reasonable attomey's fees incurred by the CITY, and including without limitation, damages for bodily and personal injury, death and property damage, and damage for professional malpractice resulting from the negligent acts or omissions of COVINGTON or any subconsultants, in perfonnance of this Agreement. COVINGTON'S liability under this Article Vlll is expressly limited to the mount of COVINGTON'S insurance coverage as set forth in Article IX. Nothing in this Agreement shall be construed to create a liability to any person who is not a party to this Agreement and nothing herein shall waive any of the party's defenses, both at law or equity, to any claim, cause of action or litigation tiled by anyone not a party to this Agreement, including the defense of governmental immunity, which defenses are hereby expressly reserved. A R TIC. I ,R TX INSURANCE During the performance of the Services under this Agreement, COVINGTON shall maintain the following insurance with an insurance company licensed to do business in the State of Texas by the State Insurance Commission or any successor agency that has a rating with Best Rate Carriers of at least an "A-" or above: Comprehensive General Liability Insurance with bodily injury limits of not less than $500,000 for each occurrence and not less than $500,000 in the aggregate, and with property damage limits of not less than $100,000 for each occurrence, and not less than $100,000 in the aggregate. B. Automobile Liability Insurance with bodily injury limits of not less than $500,000 for each Page person and not less than $500,000 for each accident; and with property damage limits of not less than $100,000 for each accident. Professional Liability Insurance with policy limits of not less than $1,000,000 annual aggregate. COVINGTON shall furnish insurance certificates or insurance policies at the CITY's request to evidence such coverages. The insurance policies shall name the CITY as an additional insured on all such policies to the extent legally possible, and shall contain a provision that such insurance shall not be canceled or modified without thirty (30) days prior written notice to CITY and COVINGTON. In such event, COVINGTON shall, prior to the effective date of the change or cancellation, deliver substitute policies furnishing the same coverage to the CITY. ARTTCIJE X ARBITRATION AND ALTERNATE DISPUTE RESOLUTION The parties agree to settle any disputes under this Agreement by submitting the dispute to arbitration or other means of alternate dispute resolution such as mediation. No arbitration or alternate dispute resolution arising out of or relating to, this Agreement involving one party's disagreement may include the other party to the disagreement without the other's approval. ARTIC. 1,1~, XI LIMITATION OF LIABILITY To the extent permitted by law, the total liability of COVINGTON to CITY for any and ali claims arising out of this Agreement, whether caused by negligence, errors, omissions, strict liability, breach of contract or contribution, or indemnity claims based on third-party claims, shall not exceed one million dollars ($1,000,000). A}~ T~C 1 ,~, X'n CONSEQUENTIAL DAMAGES In no event and under no circumstances shall COVINGTON be liable to CITY for any interest, loss of anticipated revenues, earnings, profits, or increased expense of operations, or for any consequential, indirect or special damages. PROFESSIONAl. STANDARDS COVINGTON will perform services under this Agreement with the degree of skill and diligence normally practiced by professional engineers or consultants performing the same degree of similar services. No other warranty or guarantee, expressed or implied, is made with respect to the services furnished under this Agreement and all implied warranties are disclaimed. Page 5 ARTICLE XIV TERMINATION OF AGREEMENT Notwithstanding any other provision of this Agreement, either party may terminate this Agreement by giving thirty (30) days advance written notice of termination to the other party. This Agreement may be terminated in whole or in part in the event of either party substantially failing to fulfill its obligations under this Agreement. No such termination will be effected unless the other party is given: (t) written notice (delivered by certified mail, return receipt requested) of intent to terminate and setting forth the reasons specifying the nonperformance, and not less than ten (10) business days in which to cure the failure; and (2) an opportunity for consultation with the terminating party prior to termination. If this Agreement is terminated prior to completion of the services to be provided hereunder, COVINGTON shall immediately cease alt services and shall render a final bill for services to the CITY within 30 days after the date of termination. The CITY shall pay COVINGTON for all services properly rendered and satisfactorily performed and for reimbursable expenses to termination incurred prior to the date of termination in accordance with Article IV, Compensation. Should the CITY subsequently contract with a new consultant for the continuation of services on the Project, COVINGTON shall cooperate in providing information. COVINGTON shall turn over all documents prepared or fumished by COVINGTON pursuant to this Agreement to the CITY on or before the date of termination, but may maintain copies of such documents for its use. ARTICLE XV RESPONSIBILITY FOR CLAIMS AND LIABILITIES Approval by the C1TY shall not constitute nor be deemed a release of the responsibility and liability of COVINGTON, or any sub-consultants of COVINGTON, for the accuracy and competency of their designs or other work product. ARTIOJJF. NOTICES All notices, communications, and reports required or permitted under this Agreement shall be personally delivered or mailed to the respective parties by depositing same in the United States mail at the address shown below, certified mail, retum receipt requested unless otherwise specified herein. Mailed notices shall be sent to the parties at the following addresses: To COVINGTON: To CITY: R.J. Covington Consulting, LLC Attn: Richard J. Covington 13276 Research Blvd., Suite 201 Austin, Texas 78750 City of Denton, Texas Attn: Michael A. Conduff, City Manager 215 East McKinney Street Denton, Texas 76201 Page 6 Ali notices shall be deemed effective upon receipt by the party to whom such notice is given or within three days after the date of mailing. ARTICLg, XVII ENTIRE AGREEMENT This Agreement consisting of nine (9) pages, and five (5) additional pages consisting of Task Order No. 03-H, constitutes the complete and final expression of the agreement of the parties and is intended as a complete and exclusive statement of the terms of their agreements and supersedes all prior contemporaneous offers, promises, representations, negotiations, discussions, communications and agreements which may have been made in connection with the subject matter hereof. AR TTCI .g. XVIII SEVERABILITY If any provision of this Agreement is found or deemed by a court of competent jurisdiction to be invalid or unenforceable, it shall be considered severable from the remainder of this Agreement and shall not cause the remainder to be invalid or unenforceable. In such event, the party shall reform this Agreement to replace such stricken provision with a valid and enforceable provision which comes as close as possible to expressing the intention of the stricken provision. AR TIC[ ,1~, XIX COMPLIANCE WITH LAWS COVINGTON shall comply with all federal, state, local laws, rules, regulations, and ordinances applicable to the work covered hereunder as they may now read or hereinafter be mended. ARTICI,F~ XX DISCRIMINATION PROHIBITED In performing the services required hereunder, COVINGTON shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap. ARTICT ,g. '/XI PERSONNEL Ao COVINGTON represents that he has secured, or will secure at his own expense any additional personnel required to perform all the services required under this Agreement. Such personnel shall be subconsultants of COVINGTON, and shall not be employees or officers of, nor have any contractual relations with the CITY. COVINGTON shall inform the CITY of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement. Page 7 4 All services required hereunder will be performed by COVINGTON or under his supervision. All personnel engaged in work shall be qualified and shall be authorized and permitted under state and local laws to perform such services. ARTICLt~, 3(Xll AS SIGNABILITY COVINGTON shall not assign any interest in this Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation or otherwise) without the prior written consent of the CITY. ARTICI.~ XXIII MODIFICATION No waiver or modification of this Agreement or of any covenant, condition, limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith and no evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting this Agreement, or the rights or obligations of the parties hereunder, and unless such waiver or modification is in writing, duly executed; and, the parties further agree that the provisions of this section will not be waived unless as herein set forth. .AR TTCT ,1~, X'X1V MISCELLANEOUS COVINGTON agrees that CITY shall, until the expiration of three (3) years after the final payment under this Agreement, have access to and the right to examine any directly pertinent books, documents, papers and records of COVINGTON involving transactions relating to this Agreement. COVINGTON agrees that the CITY shall have access during normal working hours to all necessary COVINGTON facilities and shall be provided adequate and appropriate working space in order to conduct audits in compliance with this section. The CITY shall give COVINGTON reasonable advance notice of any intended audits. Bo Venue of any suit or cause of action under this Agreement shall lie exclusively in Denton County, Texas. This Agreement shai1 be governed by, and construed in accordance with the laws of the State of Texas. COVINGTON shall commence, carry on, and complete the work required by this engagement with all applicable dispatch, in a sound, economical, efficient manner and in accordance with the provisions hereof. In accomplishing the work, COVINGTON shall take such steps as are appropriate to ensure that the work involved is properly coordinated with related work being carded on by the CITY. Do The CITY shall assist COVINGTON by placing at COVINGTON's disposal all available information pertinent to the work required by this engagement, including previous reports, any other data relative to the project and arranging for the access to, and make all provisions Page 8 for COVINGTON to enter in or upon, public and private property as required for COVINGTON to perform services under this Agreement. The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement. IN WITNESS WHEREOF, the City of Denton, Texas has caused this Agreement to be executed in four original counterparts, by its duly authorized City Manager; and R.J. Covington Consulting, LLC has executed this Agreement by its duly authorized officer on this the __ day of August, 2003. "CITY" CITY OF DENTON, TEXAS A Municipal Corporation ATTEST: JENNIFER WALTERS, CITY SECRETARY By: Michael A. Conduff, City Manager By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY "COVINGTON" R.J. COVINGTON CONSULTING, LLC A Texas Limited Liability Corporation By: Richard J. Covington, President S:\Our Documents\Contmets~03~R J Covington Consult/ng LLC-PSA TO 03-H-2003-DME.doc Page 9 ATTACHMENT PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITY OF DENTON AND R.J. COVINGTON CONSULTING, LLC TASK ORDER NO. 03-H Project 26736 - Market Design Work provided for in this Task Order are directed at assisting the City staff (Staff) in addressing issues associated with Project 26736 "Rulemaking Proceeding on Wholesale Market Design Issues in the Electric Reliability Council of Texas" at the Texas Legislature, the Public Utility Commission of Texas (PUC) and at the Electric Reliability Council of Texas (ERCOT). RJC will work with Staff to develop and present the City's position on the market design issue of moving ERCOT to a nodal transmission pricing system. The scope of services includes continuing participation at the PUC in Project 26736 and spin-off projects, participation at ERCOT on committees and task forces developing rules for implementing a nodal system, developing materials for lobbying the Legislature to counter the Commission's efforts in implement a nodal market design, and related work. All work on this Task Order will be at the direction of the Director of Electric Utilities. This work is being separated from other regulatory work RJC performs for the City because of its importance and the level of effort required. The PUC has stated its intent that ERCOT will implement a nodal system that will charge loads in congested areas of the state the costs of clearing that congestion. Currently those costs are uplifted to all loads in the state. This change in methodology could have a substantial negative impact on ratepayers in the Dallas/Ft. Worth area and other congested areas of the state. The City has determined that implementation of a nodal system without an appropriate cost/benefit analysis and without due consideration of the impact on ratepayers is detrimental to the state in general and to ratepayers of Denton Municipal Utility ri)ME) in particular. RJC is actively working to build a Coalition of affected parties to contest the Commission's agenda to implement a nodal system. As the second largest municipal utility in North Texas, DME will take a lead role in this effort. As in the initial stakeholder process to develop the current market design, this process will require active participation at the PUC, ERCOT and the Legislature, and will involve numerous meetings and heatings. DME will share the costs of this effort with Garland Power and Light and other aligned parties as funding is available. EXHIBIT 3 Task Order 03-H Project 26736 - Market Design Because the schedule for implementing a nodal market design extends through 2006, additional work orders may be requkcd to complete this work. RJC will keep the Director of Electric Utilities informed of the status of the budget and work may be stopped at any time by notification by the Dixector to RJC to cease work. Scope of Services Task A PUC Activities Task A-1 Attending Workshops And Hearings At PUC 1. RJC will stay informed on activities related to Project 26736 at the PUC and will attend workshops and hearings as needed. 2. When appropriate, RJC will participate in workshops and hearings to represent interests of City based on directions of Staff. 3. RJC will work with Staff in developing positions which should be taken and strategies for working with parties involved. Task A-2 Analyze Impact of Nodal Implementation 1. RJC will analyze proposed new rules related to market design, helping to identify areas of concern and preparing positions that represent the interests of the City. 2. RJC will meet with PUC staff and other parties as appropriate to discuss proposed rules, and present the City's concerns regarding the impact of the rules on DFW area ratepayers. 3. RJC will work with TMPA consultant Shams Shidiqqi, using the nodal models developed by Dr. Shadiqqi to evaluate the impact on DME customers and on the Texas market in general. Task A-3 Preparation of Comments RJC will prepare or assist in preparing comments to be filed with the PUC representing City's positions on proposed roles, projects and dockets related to nodal market design. 1. These comments will be coordinated through Staff and the City's legal team. Task A-4 Contest PUC Staff Cost/Benefit Analysis 1. Working with Lloyd Gosselink, RJC will develop and file a complaint with the Commission to encourage the Commission to implement a thorough review of the PUC staff's cost/benefit analysis. 2. RJC will participate in the project to review the cost/benefit analysis, or will participate with Lloyd Gosselink in lobbying efforts and/or the filing of lawsuits to force a detailed review of the PUC staff's cost/benefit analysis. 2of5 Task Order 03-It Project 26736 - Market Design Task B Assistance With ERCOT Task B-1 Attending Committee and Working Group Meetings At ERCOT 1. RJC will stay informed on activities at the ERCOT Independent System Operator (ISO) and will attend meetings as directed by Staff that are related to implementing the nodal market design. 2. RJC will participate in discussions in meetings, committees and work forces to represent interests of City based on directions of Staff. These will include SHAG and RMS meetings as well as task forces formed to address congestion rights, zonal boundaries, and other related issues. 3. RJC will work with Staff in developing positions which should be taken and strategies for working with other ERCOT stakeholders. Task B-2 Analyze Proposed Policies and Protocols 1. RJC will analyze new market design policies and protocols proposed by the ISO. 2. RJC will review proposed protocols with Staff, to identify areas ofconcem and prepare responses that represent the position of the City on the issues before the committees. Of particular interest will be consideration of the implementation of grandfathered congestion rights for loads in congested areas. 3. RJC will meet with ERCOT staff and other stakeholders to discuss proposed protocols, and negotiate terms to mitigate impact on DFW loads. Task C Contact Parties To Form Coalition to Contest Nodal Implementation Task C-1 Contact Parties 1. RJC will contact other affected municipalities, organizations, cooperatives, and associations to determine interest in joining DME in contesting the nodal implementation. 2. Meetings will be held with interested parties to discuss strategy and activities by Coalition. 3. Parties will be updated on activities at PUC and ERCOT related to nodal implementation. 4. RJC will coordinate with parties, mayors and attorneys to communicate concerns to PUC and Legislature. 5. RJC will contact industry groups who have opposed nodal pricing in other markets around the country to gain their experience and support. 3of5 Task Order 03-H Project 26736 - Market Design Task D Assistance At Legislature And With Media Task D-1 Develop Market Primer and White Paper 1. RJC will develop a Market Primer to assist in educating legislators, media and Coalition members on the current market design and proposed changes. 2. In addition to the Primer, a White Paper will be developed that discusses the issues and potential impacts on loads in the congested areas, as well as the impact on the economy of the DFW area and the Texas economy in general. 3. RJC will participate in meetings with interested persons to present the Primer and White Paper as needed. Task D-2 Work With Lobbyists and Publicists RJC will work with the City's lobbyists to educate legislators on the issues. RJC will work with the City's communication director and other spokespersons to inform the public of the impact on them of the Commission's push to a nodal market design. Task E Assist Attorneys in Commission Sunset Review Task E-1 Evaluate Commission's Record On Meeting Legislative Directives 1. RJC will work with the City's legal specialists to develop testimony on the Commission's actions and adherence to Legislative intent since the last Sunset Review. 2. RJC will present testimony and participate in Legislative hearings as necessary to present concerns regarding shortcomings in the Commission's operations and actions. 3. RJC will develop recommendations to realign the Commission's organization with Legislative intent. Budget RJC recommends a budget of $74,500 for labor and expenses. Because of the uncertainty regarding the level of activity required, this budget is an estimate. Additional work orders may be required to complete this work. This budget will not be exceeded without prior written approval of the City. RJC will bill this Task Order monthly, with supporting documentation of activities performed. The work being performed will be under the supervision of the Electric Utility Director and may be modified at any time upon appropriate notice to RJC. EXECUTED this day of August, 2003. 4of5 Task Order 03-H Project 26736 - Market Design AUTHORIZED BY: CITY OF DENTON, TEXAS A Texas Municipal Corporation ACCEPTED BY: R.J. COVINGTON CONSULTING, LLC By: Dated: By: Dated: ATTEST: JENNIFER WALTERS, CITY SECRETARY By: Dated: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY Dated: S:\Our Documents\Contracts~03LR J Covington TO 03-H - 2003-Market Design-DME.doc 5of5 ORDINANCE NO. 2003- AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT FOR PROFESSIONAL LEGAL SERVICES 'WITH LLOYD, GOSSELINK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., FOR LEGAL SERVICES PERTAINING TO REPRESENTATION OF THE CITY BEFORE THE PUBLIC UTILITY COMMISSION OF TEXAS, IN THE AREAS OF PUBLIC UTILITY REGULATORY LAW AND ADMINISTRATIVE LAW, RESPECTING THE PROTECTION OF THE CITY'S INTERESTS RELATING TO EFFORTS BY THE PUBLIC UTILITY COMMISSION OF TEXAS TO CHANGE THE CURRENT DESIGN OF THE ELECTRIC RELIABILITY COUNCIL OF TEXAS WHOLESALE POWER MARKET IN TEXAS; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; PROVDING FOR RETROACTWE EFFECT OF THE AGREEMENT; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council deems that it is in the public interest to engage the law firm of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas (the "Firm") to provide professional legal services to the City of Denton, Texas ("City") pertaining to representation of the City and Denton Municipal Electric ("DME") before the Public Utility Commission of Texas ("PUC") in the areas of public utilities regulatory law and administrative law; relating to efforts by the PUC to change the current design of the Electric Reliability Council of Texas ("ERCOT") wholesale power market in Texas; including Project No. 26376 entitled "Rulemaking Proceeding on Wholesale Market Design Issues in the Electric Reliability Council of Texas," and also including such other or additional projects or dockets at the PUC in the near future which are related to said Project 26376; and WHEREAS, the City staff has reported to the City Council that there is a substantial need for the above-referenced professional legal services, and that limited City staff cannot adequately perform the specialized services and tasks which are primarily centered in Austin, Texas, with its own personnel; and WHEREAS, the City has heretofore engaged the Finn by numerous previous Agreements for Professional Legal Services to perform similar services to those services provided for in the Agreement for Professional Legal Services attached hereto. Further, that the Firm has performed and provided legal services benefiting the City under the most recent Agreement on a continuous and uninterrupted basis, in order to safeguard and represent the interests of the City and DME before the PUC, in dealing with sudden, largely unpredictable events and developments, and with administrative deadlines that many times require immediate attention or response. Accordingly, it is appropriate that the new Agreement for Professional Legal Services by and between the City and the Finn attached hereto, should be ratified and confirmed, and should be retroactively approved and made effective as of July I, 2003, in order to properly compensate the Finn for its work that has already directly benefited the City, and which work was done at the specific instance and request of the City; and EXHIBIT 4 WHEREAS, Chapter 2254 of the Texas Government Code, known as the "Professional Services Procurement Act", generally provides that a City may not select a provider of professional services on the basis of competitive bids, but must select the provider on the basis of demonstrated competence, knowledge, and qualifications, and for a fair and reasonable price; and the Council hereby finds and concludes that the Firm is appropriately qualified under the provisions of that law to be retained as outside legal counsel for the City and DME respecting this engagement; NOW THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1: That the recitations set forth and contained in the foregoing preamble are expressly incorporated by reference into this Ordinance. SECTION2: That the City Manager is hereby authorized to execute an Agreement for Professional Legal Services by and between the City and the law finn of Lloyd, Gosselink, Blevins, Rochelle, Baldwin & Townsend, P.C., of Austin, Texas, in substantially the form of the Agreement for Professional Legal Services attached hereto and incorporated herewith by reference. SECTION 3: That the award of this Agreement by the City is on the basis of the demonstrated competence, knowledge, and qualifications of the Firm and the ability of the Firm to perform the services needed by the City for a fair and reasonable price. SECTION 4: That the expenditure of funds as provided in the attached Agreement for Professional Legal Services is hereby authorized. SECTION 5: That the above and foregoing Agreement for Professional Legal Services is hereby ratified, confirmed, and retroactively approved, and shall be effective from and after July 1, 2003. SECTION6: That except as otherwise provided in Section 5 above, this Ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the __ day of ,2003. EUL1NE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY By: 2 APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY S:\Our Documcnts\Ordinances\03kLtoyd Goss¢link-Project No. 26376-Wholesale Mkt Dcsigns-ERCOT-Ord.doe 3 STATE OF TEXAS § COUNTY OF DENTON § AGREEMENT FOR PROFESSIONAL LEGAL SERVICES THIS AGREEMENT, made and entered into this __ day of ., 2003, by and between LLOYD, GOSSEL1NK, BLEVINS, ROCHELLE, BALDWIN & TOWNSEND, P.C., a Texas Professional Corporation (hereinafter "Consultant"), with Lambeth Townsend, Shareholder, having full authority to execute this Agreement on behalf of the firm, 111 Congress Avenue, Suite 1800, Austin, Texas, 78701; and the CITY OF DENTON, a Texas Municipal Corporation, 215 E. McKinney, Denton, Texas, 75201 (hereinafter "City"), with Michael Conduff, City Manager, having full authority to execute this Agreement on behalf of the City. WITNESSETH: WHEREAS, the City deems it necessary and in the public interest to employ legal counsel to provide professional legal services with respect to protection of the City's interests relating to efforts by the Public Utility Commission of Texas ("PUC") to change the current design of the Electric Reliability Council of Texas ("ERCOT") wholesale power market in Texas, which efforts are presently being reviewed in Project No. 26376, Rulemaking Proceeding on Wholesale Market Design Issues in the Electric Reliability Council of Texas, but which may include numerous additional projects or dockets at the PUC in the near future; and WHEREAS, the Consultant is willing to perform such services in a professional manner as an independent contractor; and has competently and efficiently performed similar services for the City in numerous other matters before the PUC over the past several years; and the City has selected Consultant on the basis of demonstrated competence and qualifications necessary to perform the needed services; and WHEREAS, the City desires to engage the Consultant to render the professional services in -connection therewith, for a fair and reasonable price; consistent with, and for a fee not higher than the recommended practices and fees published by the applicable professional associations; and such fees do not exceed any maximum provided by law; all in accordance with the provisions of Chapter 2254 of the Texas Government Code (the "Professional Services Procurement Act"); and the Consultant is willing to provide such services; NOW, THEREFORE, in consideration of the promises and mutual obligations herein, the City and Consultant do hereby mutually AGREE as follows, to wit: I. Scope of Services: The Consultant shall perform the following services in a professional manner working as an independent contractor not under the direct supervision and control of the City: EXHIBIT 5 106019~Denton Agreement Page 1 Services to be provided: Consultant shall represent the City in Project No. 26376, Rulemaking Proceeding on Wholesale Market Design Issues in the Electric Reliability Council of Texas, and in any related additional projects or dockets at the PUC involving similar issues of changes to the design of the ERCOT wholesale market, including without limitation, the professional and legal services attendant to preparing and submitting comments, responding to requests for information, and attending all hearings and other proceedings in relationship to market design issues, and to consult with the City through its Denton Municipal Electric staff with regard to all filings, hearings, appeals, and other issues related to market design issues, and to assist in any subsequent actions in response to the Commission's final order concerning market design issues. To consult with the City Manager, the Assistant City Manager for Utilities, the Director of Denton Municipal Electric, the City Attorney, the Assistant City Attorney for Utilities, and/or other designated administrative personnel or staff regarding any and all aspects of the professional services to be performed, including legal research, analysis, and advice with respect to protecting the City's position in ERCOT wholesale market design issues currently being reviewed by the PUC. This will include coordinating activities with the Director of Denton Municipal Electric, the City Attorney, and'their respective staff to efficiently perform the s~rvices required and to preserve the Attorney/Client privilege, work product, and all other applicable exceptions to the discovery or disclosure of documents produced by the City and the Consultant under the Scope of Services hereinabove. The Consultant shall perform ali the services required by this Agreement in a timely fashion, and shall complete them in compliance with schedules established by the City through its Director of Denton Municipal Electric as appropriate to carry out the terms and conditions of this Agreement. II. Term: This Agreement shall be retroactively effective as of July 1, 2003. The Agreement shall terminate either upon the completion of the professional services provided for herein or upon the exhaustion of all professional fees provided for hereunder, whichever event shall first occur. This Agreement may be sooner terminated in accordance with the provisions hereof. Time is of the essence of this Agreement. Consultant shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible during the term of this Agreement, and to meet the schedules established by the City, through its Director of Denton Municipal Electric, or her designee. 106019~Denton Agreement Page 2 III. A. Do Compensation and Method of Payment: The Consultant shall charge the following fees for its professional services provided to the City hereunder, based upon the following hourly billing rates for the attorneys and support staff involved in this matter: Staff Hourly Rate Lambeth Townsend, Shareholder Georgia Cramp, Shareholder Melissa E. Ramirez, Associate Paralegal Law Clerk $ 230.00 $ 210.00 $170.00 $ 85.OO $ 75.00 Consultant agrees that all charges for the legal services hereunder, including expenses as set forth in Section III. C. below, shall not exceed $45,000.00. The Consultant shall endeavor to have the attomeys and employees listed in Section III.A. above, reasonably attempt to reduce costs by utilizing other qualified shareholders, associates, and paralegals wherever feasible or possible. The Consultant shall bill the City through the submission of itemized invoices, statements, and other dOcumentation, together with support data indicating the progress of the work and the services performed on the basis of monthly statements, showing hourly rates indicating who performed the work, what type of work was done, and descriptions and/or details of all services rendered, including a daily, and an entry-by-entry reflection of billable time spent on this engagement, along with specific descriptions and supporting documentation, if available, respecting any reasonable and necessary out-of-pocket expenses incurred by Consultant in performing the professional services provided for under this Agreement. Professional fees shall be billed in minimum one-tenth (1/10) hour increments. Additionally, the City shall either pay directly or reimburse the Consultant, as the case may be, for reasonable and necessary actual out-of-pocket expenses, including but not limited to, long-distance telephone, telecopier, reproduction, postage, overnight courier, and transportation and travel. All copies will be charged at the rate of fifteen cents ($.15) per copy for copies made within Consultant's offices, with as much photocopying as possible being done by outside vendors at bulk rates or by the City to reduce costs if bulk copying is necessary or appropriate. The parties agree that the charges for outgoing telecopies from Consultant shall be $.25 per page and that there will be no charge for incoming telecopies. The parties anticipate that invoices or statements for professional services will be generated on a monthly basis and that said invoices or statements will be sent to the City by Consultant on or about the 15th day of each month. The City shall make payment to the Consultant wittfin thirty (30) days after receipt of an appropriate itemized invoice or statement. To the extent that any fees or expenses are disputed 106019~Denton Agreement Page 3 IV. A. by the City, the City shall notify Consultant within thirty (30) days after its receipt of the invoice or statement, and shall otherwise pay all undisputed amounts set forth in the invoice or statement within thirty (30) days after its receipt of the invoice or statement. All reimbursable expenses, including, but not necessarily limited to travel, lodging, and meals, shall be paid at the actual cost, pursuant to the terms, conditions, and limitations set forth herein. All invoices or statements shall be a reviewed by the Director of Denton Municipal Electric, or her designee; and shall be reviewed and approved by the Assistant City Attorney/Utilities. It is understood and agreed that the Consultant shall work under the coordination and general supervision of the Director of Denton Municipal Electric, or her designee. All notices, invoices, statements, and payments shall be made in writing and may be given by personal delivery or by mail. As to notices: to Michael Conduff, City Manager, City of Denton, 215 East McKirmey, Denton, Texas 76201 or to his designee. As to invoices, statements, or payments: to Michael S. Copeland, Assistant City Attorney/Utilities, Utility Administration Department, at the same address, as to the City; and to Lambeth Townsend, Lloyd/Gosselink, 111 Congress Avenue, Suite 1800, Austin, Texas 78701, as to the Consultant. When so addressed, the notice, invoice, statement and/or payment shall be deemed given upon deposit of same in the U. S. Mail, postage prepaid. In all other instances, notices, invoices, statements, and/or payments shall be deemed given at the time of actual delivery. Changes may be made in the names and addresses of the responsible person or office to which notices, invoices, statements and/or payments are to be sent, provided reasonable notice is given. Professional Competency: Consultant agrees that in the performance of these professional services, Consultant shall be responsible to the level of competency and shall use the same degree of skill and care presently maintained by other practicing professionals performing the same or similar types of work. For the purpose of this Agreement, the key persons who will be performing most of the work hereunder shall be Lambeth Townsend and Georgia Crump, Shareholders, and Melissa E. Ramirez, Associate. However, nothing herein shall limit Consultant from using other qualified and competent members of the firm to perform the services required herein if such delegation is reasonably appropriate and properly protects the City's interests. Any agreements, ordinances, notices, instruments, memoranda, reports, letters, and other.legal documents prepared or obtained under the terms of this Agreement are instruments of service and the City shall retain ownership and a' property interest therein. If this Agreement is terminated at any time for any reason prior to payment to the Consultant for work under this Agreement, all such documents prepared or obtained under the terms of the Agreement shall upon termination be 106019~)enton Agreement Page 4 delivered to and become the property of the City upon request and without restriction on their use or further compensation to the Consultant. V. Establishment and Maintenance of Records: Full and accurate records shall be maintained by the Consultant at its place of business with respect to all matters covered by this Agreement. Such records shall be maintained for a period of at least three years after receipt of final payment under this Agreement. VI. Audits and Inspection: At any time during normal business hours and upon reasonable notice to the Consultant, there shall be made available to the City all of the Consultant's records with respect to all matters covered by this Agreement. The Consultant shall permit the City to audit, examine, and make excerpts or transcripts from such records, and to make audits of contracts, invoices, materials, and other data relating to all matters covered by this Agreement. VII. Accomplishment of Project: The Consultant shall commence, carry on, and complete this professional engagement with all practicable dispatch; in a sound, economical and efficient matter; and, in accordance with the provisions hereof and all applicable laws. In accomplishing the project, the Consultant shall take such steps as are appropriate to insure that the work involved is properly coordinated with any related work being carded on by the City. VIII. Indemni~, and Independent Contractor Relationship:.' Consultant shall perform ail services as an independent contractor not under the direct supervision and control of the City. Nothing herein shall be construed as creating a relationship of employer and employee between the parties. The City and Consultant agree to cooperate in the defense of any claims, action, suit, or proceeding of any kind brought by a third party which may result from or directly or indirectly arise from any negligence and/or errors or omissions on the part of the Consultant or from any breach of the Consultant's obligations under this Agreement. In the event of any litigation or claim under this Agreement in which Consultant is joined as a party, Consultant shall provide suitable counsel to defend City and Consultant against such claim, provided the Consultant shall have the right to proceed with the competent counsel of its own choosing. The Consultant agrees to defend, indemnify and hold harmless the City and all of its officers, agents, servants, and employees against any and all such claims to the extent of coverage by Consultant's professional liability policy. ' The Consultant agrees to pay all expenses, including but not limited to attorney's fees, and satisfy all judgments that may be incurred or rendered against the Consultant's professional liability insurance policy~ Nothing herein constitutes a waiver of any rights or remedies the City may have to pursue under either law or equity, including, without limitation, a cause of action for specific performance or for damages, a loss to the City, resulting from Consultant's negligent errors or omissions, or breach of contract, and all such rights and remedies are expressly reserved. Consultant shall maintain and shall be caused to be in force at all times during the term of this Agreement, a legally binding policy of professional liability insurance, 106019~Denton Agreement Page 5 listed by Best Rated Carders, with a rating of"A~" or above, issued by an insurance. carrier approved to do business in Texas by the State Insurance Commission. Such coverage shall cover any claim hereunder occasioned by the Consultant's negligent professional act and/or error, act, or omission, in an amount not less than $1,000,000 combined single limit coverage per occurrence. In the event of change or cancellation of the policy by the insurer, the Consultant hereby covenants to immediately notify the City in writing thereof; and in such event, the Consultant shall, prior to the effective date of change or cancellation, serve a substitute policy furnishing the same or higher amount of coverage. The Consultant shall provide a copy of the declarations page of such policy to the City through its Director of Denton Municipal Electric simultaneously with the execution of this Agreement. IX. Termination of Agreement: In connection with the work outlined in this Agreement, it is agreed and fully understood by the Consultant that the City may cancel or indefinitely suspend further work hereunder or terminate this Agreement at any time upon written notice to Consultant, Consultant shall cease all work and labor being performed under this Agreement. Consultant may terminate this Agreement by giving the City fifteen (15) days written notice that Consultant is no longer in a position to continue representing the City. Consultant shall invoice the City for all work satisfactorily completed and shall be compensated in accordance with'the terms of this Agreement. All reports and other documents, or data, or work related to the project shall become the property of the City upon termination of this Agreement. This Agreement may be terminated in whole or in part, in writing, by either party in the event of substantial failure by the other party to fulfill its obligations under this Agreement through no fault of the terminating party. Provided, however, that no such termination may be affected, unless the other party is given [1] written notice (delivered by certified mail, retum receipt request) of intent to terminate, and not less than thirty (30) calendar days to cure the failure; and, [2] an opportunity for consultation with the terminating party prior to termination. Co Nothing contained herein or elsewhere in this Agreement shall require the City to pay for any work which is unsatisfactory or which is not submitted in compliance with the terms of this Agreement. X. Alternate Dispute Resolution: The Consultant agrees that, if necessary, it will use its best efforts to resolve any disputes regarding the Agreement through the use of mediation or other forms of alternate dispute resolution set forth in Chapter 154 of the Texas Civil Practices and Remedies Code (V.A.T.C.S.). XI. Entire Affreement: This Agreement represents the entire agreement and understanding between the parties and any negotiations, proposals, or oral agreements are intended to be integrated herein and to be superseded by this written Agreement. Any supplement or 106019kDenton Agreement Page 6 amendment to this Agreement, in order to be effective, shall be in writing and signed by the City and the Consultant. XII. Compliance with Laws: The Consultant shall comply with all federal, state, local laws, roles, regulations, and ordinances applicable to the work covered hereunder as they may nOw read or hereafter be amended, including but not limited to the Texas Disciplinary Rules of Professional Conduct. XIII. Governing Law: For the purpose of determining place of agreement and law governing same, this Agreement is entered into in the City and County of Denton, State of Texas, and shall be construed in accordance with, and governed by the laws of the State of Texas. Venue and jurisdiction of any suit or cause of action arising under or in connection with this Agreement shall lie exclusively in a court of competent jurisdiction sitting in Denton County, Texas. XIV. Discrimination Prohibited: In performing the services required hereunder, the Consultant shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap. XV. Personnel: Consultant represents that it has or will secure at its own expense all personnel required to perform the services required under this Agreement. Such personnel shall not be employees nor have any contractual relations with the City. Consultant shall inform the City of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement, in accordance with Consultant's responsibilities under the Texas Disciplinary Rules of Professional Conduct. Bo Ali services required hereunder will be performed by the Consultant or under its direct supervision. All personnel engaged in work shall be qualified and shall be licensed, authorized, or permitted under state and local laws to perform such services. XVI. Assignability: The Consultant shall not assign any interest in this Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation, or otherwise) without the prior written consent of the City thereto. XVII. Severability: All agreements and covenants contained herein are severable, and in the event any of them, with the exception of those contained in sections headed "Scope of Services", "Independent Contractor Relationship", and "Compensation and Method of Payment" hereof, shall be held to be invalid by any court of competent jurisdiction, this Agreement shall be interpreted as though such invalid agreements or covenants were not contained herein. XVIII. Responsibilities for Claims and Liability: Approval by the City shall not constitute nor be deemed a release of the responsibility and liability of the Consultant for the accuracy and competency of its work; nor shall such approval be deemed to be an assumption of such responsibility of the City for any defect in any report or other documents prepared by the 106019XDenton Agreement Page 7 Consultant, its shareholders, associates, employees, officers, or agents in connection with this engagement. XIX. Modification of Agreement: No waiver or modification of this Agreement or of any covenant, condition, or limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith. No evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting this Agreement, or the rights or obligations of the parties hereunder, unless such waiver or modification is in writing, duly executed as aforesaid. The parties further agree that the provisions of this article will not be waived as herein set forth. XX. Captions.'. The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement. XXI. Binding Effect: This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, legal representatives, successors, and assigns, where permitted by this Agreement. IN WITNESS HEREOF, the City of Denton, Texas has executed this Agreement in four (4) original counterparts by and through its duly authorized City Manager; and Consultant has executed this Agreement by and through its duly authorized undersigned Shareholder; dated this the day of ,2003. CITY OF DENTON, TEXAS A Texas Municipal Corporation By: Michael Conduff, City Manager ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: · 106019'tDenton Agreement Page 8 LLOYD, GOSSELIN , ROCHELLE, BLEVINS ROCHELLE, BALDWI2q & TOWNSEND, P.C. A Texas Professional Corporation By: ~~~7~L'~ v Lambeth Townsend, Shareholder ATTEST: 106019~)enton Agreement Page 9 AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Electric Utility Howard Martin, 349-8232 SUBJECT: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH R. J. COVINGTON. LLC FOR COUSULTING SERVICES RELATING TO TASK ORDER NO. 03-G, FOR SERVICES PERTAINING TO REPRESENTATION OF DENTON MUNICIPAL ELECTRIC BEFORE ELECTRIC RELIABILITY COUNCIL OF TEXAS, PROVISION OF ANALYSIS AND TECHNICAL SUPPORT RELATED TO REGULATORY AND COMPETITIVE ISSUES, MONITORING AND EVALUATION OF ELECTRIC INDUSTRY ACTIVITIES; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFORE; PROVIDING FOR RETROACTIVE EFFECT OF THE AGREEMENT AND PROVIDING AN EFFECTIVE DATE. BACKGROUND: For the past seven years, it has been the practice of Denton Municipal Electric (DME) to maintain a general regulatory services task order with R. J. Covington, initially as an employee of Resource Management International followed by contracting with his independent consulting firm. The most recent of these contracts was issued in December of 2002 in the amount of $100,000. All funds have been utilized in that task order. Since the passing of Senate Bill 7, Mr. Covington's firm, working in coordination with DME and Garland staff members, has been critical in providing coverage of the Austin based Electric Reliability Council of Texas (ERCOT) committee meetings and Texas Public Utilities Commission (TPUC) workshops that occur weekly and impact the operational structure of the retail and wholesale deregulated marketplace. The ongoing changes being introduced almost daily into the deregulated electric marketplace by the TPUC, ERCOT staff and electric market participants are often critical to DME's ability to successfully function in the marketplace. It has become clear that failure of DME to monitor and participate effectively in these activities will result in development of a market model harmful to the interest of smaller players such as DME. Over the last four months, the activity level in this area has increased greatly due to the TPUC's effort to force a complete redesign of the process by which the wholesale electric market is now being managed. The Covington firm has represented DME in this process thus far under the December, 2002 general Regulatory Services Task Order. Both Garland and DME have utilized the Covington firm's support, combined with their own staff efforts to try to prevent a complete wholesale market redesign effort from being initiated. That effort has used the funds available in the December, 2002 Task Order. Since the TPUC has now issued an order requiring the market redesign effort to move ahead, a specific Task Order 03-H has been set up to deal with that process rather than continue with work related to that effort under a general task order. In the past the general task order has been used to provide a variety of analytical and strategic planning support to DME in areas such as: · Development of strategic options · Gas price forecasts · Assistance in financial and technical model developmem · Drafting of small contracts and agreements · Technical support for state legislative efforts · Review and analysis of TMPA financial records · DME load analysis · Support for DME Texas Public Utility Commission (TPUC) filings · Represemation of DME at Electric Reliability Council of Texas (ERCOT) committee meetings · Review and monitoring of all activities at the TPUC and ERCOT to idemify developing issues that will impact DME The existing DME staff is unable to perform all of these types of tasks either because of workload or lack of expertise. In addition, Mr. Covington's location in Austin provides a cost effective way to access data located in Austin, such as TPUC records and filings by other electric utilities, a cost effective way of assuring DME's interests are represented at the numerous critical meetings that are held in Austin, and provides him access to information sources not available to staff isolated in DeNon. The availability of a general task order with a firm that has an in depth knowledge of DME's structure and position in the market allows DME to react to unforeseen issues in a timely fashion. In today's deregulated environmem, such issues often require identification and reaction much faster than the City's contract approval process or DME's limited staff can accommodate. OPTIONS: 1. Continue to use the Covington firm's services 2. Reduce DME participation in the Texas electric market. Rely totally on DME staff for all other technical issues. RECOMMENDATIONS: DME staff recommends approval of the task order. PRIOR ACTION/REVIEW (Council, Boards, Commission): The Public Utilities Board will consider this item at its August 18~h, 2003 meeting. recommendation will be provided to Council at the August 19~h City Council meeting. FISCAL INFORMATION: The cost of this task order is not to exceed $45,000. EXHIBITS: 1. Ordinance 2. Agreement 3. Task Order Respectfully submitted: Sharon Mays Director of Electric Utilities Their ORDINANCE NO. 2003- AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT WITH R. J. COVINGTON CONSULTING, LLC FOR CONSULTING SERVICES RELATING TO TASK ORDER NO. 03-G, REGARDING REGULATORY SERVICES AND SUPPORT OF CITY STAFF ON ISSUES ADDRESSED AT THE PUBLIC UTILITY COMMISSION OF TEXAS AND THE ELECTRIC RELIABILITY COUNCIL OF TEXAS, RELATING TO DENTON MUNICIPAL ELECTRIC; AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council deems it in the public interest to engage the firm of R. J. Covington Consulting, LLC of Austin, Texas ("Covington"), to provide professional consulting services to the City relating to Task Order No. 03-G; which includes, without limitation, regulatory services and support of City Staff at the Public Utility Commission of Texas ("PUC") and the Electric Reliability Commission of Texas ("ERCOT"), and work with City Staff to develop and present the City's position on those issues that may affect the City; and WHEREAS, the City staffhas reported to the City Council that there is a substantial need for the above-described specialized professional services, and that limited City staff cannot adequately perform the services and tasks with its own personnel; and WHEREAS, Chapter 2254 of the Texas Govemment Code, known as the "Professional Services Procurement Act", generally provides that a City may not select a provider of professional services on the basis of competitive bids, but must select the provider on the basis of demonstrated competence, knowledge, and qualifications, and for a fair and reasonable price; and WHEREAS, Covington has represented DME continuously and ably over the past seven years, and has proven to be a valuable, affordable, competent, dependable professional resource that has expertise in and is well acquainted with the electric financial and regulatory framework of Denton Municipal Electric ("DME"). Covington and his staff are familiar with the characteristics and operations of DME; and WHEREAS, the City Council has provided in the City Budget for the appropriation of funds to be used for the purchase of the professional services, as set forth in the Professional Services Agreement; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION I: That the City Manager is hereby authorized to execute a Professional Services Agreement with R. j. Covington Consulting, LLC of Austin, Texas, for professional consulting services relating to Task Order No. 03-G, to Denton Municipal Electric, in substantially the form of the Professional Services Agreement attached hereto and incorporated herewith by reference as Exhibit "A." EXHIBIT 1 SECTION 2: That the award of this Agreement by the City is on the basis of the demonstrated competence, knowledge, and qualifications of Covington and the ability of Covington to perform the professional services needed by the City for a fair and reasonable price. SECTION 3: That the expenditure of funds as provided in the attached Professional Services Agreement is hereby authorized. SECTION 4: That the above and foregoing Professional Services Agreement is hereby ratified, confirmed, and retroactively approved, and shall be effective from and after July 1, 2003. SECTION 5: That except as otherwise provided by Section 4 above, th/s ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ) 2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: $:\Our DocumentskOrdinances~,03hR J Covington Consulting LLC-DME-Ord Aprv TO-3-O 2003-Keg Svcs.doc STATE OF TEXAS COUNTY OF DENTON PROFESSIONAL SERViCES AGREEMENT FOR CONSULTING SERViCES PERTAINING TO DENTON MUNICIPAL ELECTRIC TItlS AGREEMENT is made and entered into as of the ~ day of August, 2003, by and between the City of Denton, a Texas Municipal Corporation, with its principal office at 215 East McKinney Street, Denton, Texas 76201 ("CITY"); and K J. COVINGTON CONSULTING, LLC, A Texas Limited Liability Corporation, with ks principal office at 13276 Research Blvd., Suite 201, Austin, Texas 78750, hereafter "COVINGTON"; acting herein by and through their duly authorized representatives. WlTNESSETH, that in consideration of the covenants, promises and agreements herein contained, the CITY and COVINGTON do hereby AGREE as follows: ARTICLE I EMPLOYMENT OF CONSULTANT The CITY hereby contracts with COVINGTON, as an independent contractor, and COVINGTON hereby agrees to perform the services herein in connection with the Scope of Services as stated in the Articles to follow, with diligence and in accordance with the highest professional standards customarily obtained for sUch services in the State of Texas. ARTICLE II SCOPE OF SERVICES A. COVINGTON shall provide to the CITY professional consulting services pertaining to assisting CITY Staffin areas associated with operating in the competitive restructured electric industry in Texas. As issues are addressed at the Public Utility Commission of Texas ("PUC") and at the Electric Reliability Council of Texas ("ERCOT"), COVINGTON will work with Staff to develop and present the City's position on those issues that may affect the CITY. COVINGTON agrees to perform those services and tasks more particularly described in Task Order No. 03-G attached hereto and incorporated herewith by reference. B. To consult with the City Manager, Assistant City Manager/Utilities, the Director of Electric Utilities, the Utility Attorney, and any other designated administrative personnel regarding any and ail aspects of the services to be performed pursuant to this Agreement. ARTICLE IH PERIOD OF SERVICE Tiffs Agreement shall become retroactively approved, ratified and effective as of July 1, 2003, upon its execution by both the CITY and COVINGTON. The termination date of tiffs Agreement EXHIBIT 2 shall be upon the earliest to occur of the following events: completion of the work described herein and in the attached Task Order No. 03-G; or upon the depletion and exhaustion of the $45,000 not to exceed amount provided for herein; or upon fifteen (15) day's written notice to terminate, issued by the Director of Electric Utilities, DME. This Agreement may be sooner terminated in accordance with the provisions hereof. Time is of the essence in this Agreement. COVINGTON shall make all reasonable efforts to complete the services set forth herein as expeditiously as possible and to meet the schedule established by the CITY, acting through its Director of Electric Utilities. ARTICLE IV COMPENSATION COMPENSATION TERMS: "Direct Non-Labor Expense" is defined as that expense for any assignment incurred hereunder by COVINGTON for supplies, long-distance telephone, telecopier, reproduction expense, overnight courier, photocopy expense, transportation, travel, communications, subsistence and lodging away from home and similar incidental expenses reasonably incurred in connection with that assignment. BILLiNG AND PAYMENT: 1. For and in consideration of the professional services to be performed by COVINGTON herein, the CITY agrees to pay COVINGTON, a total fee, including reimbursement for direct non-labor expense, not to exceed $45,000 for those services described in Task Order No. 03-G. 2. The fee for the services described in ttfis Agreement to be performed by COVINGTON are to be billed the rates as set forth in Exhibit "A" attached hereto and incorporated herewith by reference. Billing shall be reported in minimum one-quarter (I/4) hour increments. 3. .Payments to COVINGTON will be made by the CITY on the basis of detailed monthly statements rendered to the CITY through its Director of Electric Utilities. The fee bills as submitted, shall be allowed and approved by the Director of Electric Utilities. However, under no circumstances shall any monthly statement for services exceed the value of the work performed at the time a statement is rendered. 4. Nothing contained in this Article shall require the CITY to pay for any work which is unsatisfactory as reasonably determined by the City Manager or the Director of Electric Utilities, or which is not submitted in compliance with the terms of this Agreement. The City shall not be required to make any payments to COVINGTON when COVINGTON is in default under this Agreement. 5. It is specifically understood and agreed that COVINGTON shall not be authorized to undertake any work pursuant to this Agreement which would require additional payments by the CITY for any charge, expense or reimbursement above the maximum not-to-exceed fee as stated, without first having obtained written authorization from the CITY. Page 2 C. PAYMENT If the CITY fails to make payments due COVINGTON for services and expenses within forty (40) days after receipt of COVINGTON'S undisputed statement thereof, the amounts due COVINGTON will be increased by the rate of one percent (1%) per month from the said forty (40th) day, and in addition, COVINGTON may, alter giving ten (10) days' written notice to the CITY, suspend services under this Agreement until COVINGTON has been paid in full all amounts due for services, expenses and charges provided. However, nothing herein shalI require the CiTY to pay the late charge of one percent (1%) set forth herein if the CITY reasonably determines that the work of COVINGTON is unsatisfactory, in accordance with this Article IV, Compensation, and the CITY notifies COVINGTON in writing of any such defect. ARTICLE V OBSERVATION AND REVIEW OF THE WORK COVINGTON will exercise reasonable care and due diligence in discovering and promptly reporting to the CITY any defects or deficiencies in his work or the work of any subconsultants performed hereunder. ARTICLE Vt OWNERSHIP OF DOCUMENTS All documents, analyses and other data prepared by COVINGTON under this Agreement ("Work Products") are instruments of service and are and shall remain the property of CITY. COVINGTON shall have the right to make and retain copies and use all Work Products; provided, however, the use shall be limited to the intended use for which the services and Work Products are provided under this Agreement. COVINGTON may use and may copyright certain non-sensitive Work Products as property of COVINGTON; provided that prior written approval is obtained from CITY, whose approval shall not be unreasonably withheld, and providing that copywriting will not restrict CITY'S right to retain or make copies of the Work Products for its information, reference and use on the Project or services under the Agreement. The Work Products shall not be changed or used for purposes other than those set forth in this Agreement without the prior written approval of COVINGTON If CITY releases the Work Products to a third party without COVINGTON'S prior written consent, or changes or uses the Work Products other than as intended hereunder, CITY does so at its sole risk and discretion and COVINGTON shall not be liable for any claims or damages resuking from or connected with the release or any third party's use of the Work Products. ARTICLE VIi INDEPENDENT CONTRACTOR Page 3 COVINGTON shall provide services to the CITY as an independent contractor, not as an employee of the CITY. COVINGTON shall not have or claim any fight arising from employee status. ARTICLE VIII INDEMNITY AGREEMENT COVINGTON shall indemnify and save and hold ham~less the CITY and its officers, agents, and employees from and against any and all liability, claims, demands, damages, losses and expenses, including but not limited to court costs and reasonable attorney's fees incurred by the CITY, and including without limitation, damages for bodily and personal injury, death and property damage, and damage for professional malpractice resulting from the negligent acts or omissions of COVINGTON or any subconsultants, in performance of this Agreement. COVINGTON'S liability under this Article VIII is expressly limited to the amount of COVINGTON'S insurance coverage as set forth in Article IX. Nothing in this Agreement shall be construed to create a liability to any person who is not a party to this Agreement and nothing herein shall waive any of the party's defenses, both at taw or equity, to any claim, cause of action or litigation filed by anyone not a party to this Agreement, including the defense of governmental immunity, which defenses are hereby expressly reserved. ARTICLE IX INSURANCE During the performance of the Services under this Agreement, COVINGTON shall maintain the following insurance with an insurance company licensed to do business in the State of Texas by the State Insurance Commission or any successor agency that has a rating with Best Rate Carriers of at least an "A-" or above: A. Comprehensive General Liability Insurance with bodily injury limits of not tess than $500,000 for each occurrence and not less tim $500,000 in the aggregate, and with property damage limits of not less than $t00,000 for each occurrence, and not less than $100,000 in the aggregate. B. Automobile Liability Insurance with bodily injury limits of not less than $500,000 for each person and not less than $500,000 for each accident; and with property damage limits of not less than $100,000 for each accident. C. Professional Liability Insurance with policy limits of not less than $1,000,000 annual aggregate. COVINGTON shall furnish insurance certificates or insurance policies at the CITY's request to evidence such coverages. The insurance policies shall name the CITY as an additional insured on all such policies to the extent legally possible, and shall contain a provision that such insurance shall not be canceled or modified without thirty (30) days prior written notice to CITY and COVINGTON. In such event, COVINGTON shall, prior to the effective date of the change or cancellation, deliver substitute policies furnishing the same coverage to the CITY. Page ARTICLE X ARBITRATION AND ALTERNATE DISPUTE RESOLUTION The parties agree to settle any disputes under this Agreement by submitting the dispute to arbitration or other means of altemate dispute resolution such as mediation. No arbitration or alternate dispute resolution arising out of or relating to, this Agreement involving one party's disagreement may include the other party to the disagreement without the other's approval. ARTICLE Xi LIMITATION OF LIABILITY To the extent permitted by law, the total liability of COVINGTON to CITY for any and all claims arising out of this Agreement, whether caused by negligence, errors, omissions, strict liability, breach of contract or contribution, or indemnity claims based on third-pamj claims, shall not exceed one million dollars ($I,000,000)L ARTICLE XII coNs[ QmNTtAL r AMA ES In no event and under no circumstances shall COVINGTON be liable to CITY for any interest, loss of anticipated revenues, eamings, profits, or increased expense of operations, or for any consequential, indirect or special damages. ARTICLE XIII PROFESSIONAL STANDARDS COVINGTON will perform services under tiffs Agreement with the degree of skill and diligence normally practiced by professional engineers or consultants performing the same degree of similar services. No other warranty or guarantee, expressed or implied, is made with respect to the services furnished under this Agreement and ail implied warranties are disclaimed. ARTICLE XIV TERMINATION OF AGREEMENT Notwithstanding any other provision of this Agreement, either party may terminate this Agreement by giving thirty (30) days advance written notice of termination to the other party. This Agreemem may be terminated in whole or in part in the event of either party substantially failing to fulfill its obligations under this Agreement. No such termination will be effected unless the other party is given: (1) written notice (delivered by certified mail, return receipt requested) of intent to terminate and setting forth the reasons specifying the nonperformance, and not less than ten (t0) business days in which to cure the failure; and (2) an opportunity for consultation with the terminating party prior to termination. Page 5 If this Agreement is terminated prior to completion of the services to be provided hereunder, COVINGTON shall immediately cease all services and shall render a final bill for services to the CITY within 30 days after the date of termination. The CITY shall pay COVINGTON for all services properly rendered and satisfactorily performed and for reimbursable expenses to termination incurred prior to the date of termination in accordance with Article IV, Compensation. Should the CITY subsequently contract with a new consultant for the continuation of services on the Project, COVINGTON shall cooperate in providing information. COVINGTON shall turn over all documents prepared or fumished by COVINGTON pursuant to this Agreement to the CITY on or before the date of termination, but may maintain copies of such documents for its use. ARTICLE XV RESPONSIBILITY FOR CLAIMS AND LIABILITIES Approval by the CITY shall not constitute nor be deemed a release of the responsibility and liability of COVINGTON, or any sub-consultants of COVINGTON, for the accuracy and competency of their designs or other work product. ARTICLE XVI NOTICES Alt notices, communications, and reports required or permitted under this Agreement shall be personally delivered or mailed to the respective parties by depositing same in the United States mail at the address shown below, certified mail, return receipt requested unless otherwise specified herein. Mailed notices shall be sent to the parties at the following addresses: To COVINGTON: To CITY: R.J. Covington Consulting, LLC Attn: Richard J. Covington 13276 Research Blvd., Suite 201 Austin, Texas 78750 City of Denton, Texas Attn: Michael A. Conduff, City Manager 215 East McKirmey Street Denton, Texas 7620 t All notices shall be deemed effective upon receipt by the party to whom such notice is given or within three days after the date of mailing. ARTICLE XVII ENTIRE AGREEMENT This Agreement eondsting of nine (9) pages, and four (4) additional pages consisting of Task Order No. 03-G, constitutes the complete and final expression of the agreement of the parties and is intended as a complete and exclusive statement of the terms of their agreements and supersedes all prior contemporaneous offers, promises, representations, negotiations, discussions, communications Page 6 and agreements which may have been made in connection with the subject matter hereof. ARTICLE XVIII SEVERABILITY If any provision of this Agreement is found or deemed by a court of competent jurisdiction to be invalid or unenforceable, it shall be considered severable fi-om the remainder of this Agreement and shall not cause the remainder to be invalid or unenforceable. In such event, the patty shall reform this Agreement to replace such stricken provision with a valid and enforceable provision which comes as close as possible to expressing the intention of the stricken provision. ARTICLE XIX COMPLIANCE WITH LAWS COVINGTON shall comply with all federal, state, local laws, rules, regulations, and ordinances applicable to the work covered hereunder as they may now read or hereinatter be amended. ARTICLE XX DISCRIMINATION PROHIBITED In peffonning the services required hereunder, COVINGTON shall not discriminate against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or physical handicap. ARTICLE XXI PERSONNEL COVINGTON represents that he has secured, or will secure at his own expense any additional personnel required to perform all the services required under this Agreement. Such personnel shall be subconsultants of COVINGTON, and shall not be employees or officers of, nor have any contractual relations with the CITY. COVINGTON shall inform the CITY of any conflict of interest or potential conflict of interest that may arise during the term of this Agreement. Ail services required hereunder will be performed by COVINGTON or under his supervision. Ail personnel engaged in work shall be qualified and shall be authorized and permitted under state and local laws to perform such services. ARTICLE XXII ASSIGNABILITY COVINGTON shall not assign any interest in this Agreement and shall not transfer any interest in this Agreement (whether by assignment, novation or otherwise) without the prior written consent of the CITY. Page ARTICLE XXIII MODIFICATION No waiver or modification of this Agreement or of any covenant, condition, limitation herein contained shall be valid unless in writing and duly executed by the party to be charged therewith and no evidence of any waiver or modification shall be offered or received in evidence in any proceeding arising between the parties hereto out of or affecting this Agreement, or the rights or obligations of the parties hereunder, and unless such waiver or modification is in writing, duly executed; and, the parties further agree that the provisions of this section will not be waived unless as herein set forth. ARTICLE XXIV MISCELLANEOUS COVINGTON agrees that CITY shall, until the expiration of three (3) years after the final payment under this Agreement, have access to and the right to examine any directly pertinent books, documents, papers and records of COVINGTON involving transactions relating to this Agreement. COVINGTON agrees that the CITY shall have access during normal working hours to alt necessary COVINGTON facilities and shall be provided adequate and appropriate working space in order to conduct audits in compliance with this section. The CITY shall give COVINGTON reasonable advance notice of any intended audits. Venue of any suit or cause of action under this Agreement shall lie exclusively in Denton County, Texas. This Agreement shall be governed by, and construed in accordance with the laws of the State of Texas. COVINGTON shall comsrtence, carry on, and complete the work required by this engagement with all applicable dispatch, in a sound, economical, efficient manner and in accordance with the provisions hereof. In accomplishing the work, COVINGTON shall take such steps as are appropriate to ensure that the work involved is properly coordinated with related work being carried on by the CITY. The CITY shall assist COVINGTON by placing at COViNGTON's disposal all available ixfformation pertinent to the work required by this engagement, including previous reports, any other data relative to the project and arranging for the access to, and make ail provisions for COVINGTON to enter in or upon, public and private property as required for COVINGTON to perform services under this Agreement. The captions of this Agreement are for informational purposes only and shall not in any way affect the substantive terms or conditions of this Agreement. IN WITNESS WHEREOF, the City of Denton, Texas has caused this Agreement to be executed in four original counterparts, by its duly authorized City Manager; and R.J. Covington Consulting, LLC has executed this Agreement by its duty authorized officer on this the __ day of August, 2003L Page 8 "CITY" CITY OF DENTON, TEXAS A Municipal Corporation ATTEST: JENNWER WALTERS, CITY SECRETARY By: Michad A. Conduff, City Manager By: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY By: "COVINGTON" R.J. COVINGTON CONSULTING, LLC A Texas Limited Liability Corporation }iill stamp, Executive Vice President S:~Our Document¢,Contracts\O3~R J Cox~gton Consulting LLC-PSATO 03-G 2003-Rcg Svcs-DME.doc Page 9 ATTACHMENT PROFESSIONAL SERVICES AGREEMENT BETWEEN THE CITY OF DENTON AND R.J. COVINGTON CONSULTING, LLC TAsK ORDER NO. 03-G Regulatory Services Tasks provided for in this Attachment' are directed at assisting the City staff (Staff) in areas associated with operating in the competitive restructured electric industry in Texas. As issues are addressed at the Public Utility Commission of Texas (PUC) and at the Electric Reliability Council of Texas (ERCOT), RJC will work with Staff to develop and present the City's position on those issues that may affect the City. Following is an overview of each of the primary areas of services to be provided under this Task Order. Regulatory Support at PUC and ERCOT The scope of services includes continuing participation at the PUC in dockets and projects that affect the City, and, at the direction of the Electric Utility Director, attend and participate at ERCOT on issues in coordination with Staff. Increasingly, the PUC staff is becoming active in filing and participating in revisions to the ERCOT Protocols. There are revisions to the ERCOT Protocols filed almost daily. Staying on top of these, and other developments at the ERCOT Wholesale Market Subcommittee, allows DME to be an effective spokesperson for Denton Municipal Utility (DME) ratepayers. As ongoing changes and modifications are made to the PUC Substantive Rules and ERCOI operating protocols, issues will continue to arise that can substantially affect the City's cost of doing business. At the PUC, issues arise such as the oversight of ERCOT, rulemakings on disclosure of sensitive information, and enforcement of wholesale market rules as examples. It is important for DME to be knowledgeable on these issues and participate in the discussions to represent the municipal electric utility market segment in general,, and DME customers specifically. RJC effectively works with Staff and the-City's attorneys to provide notification, evaluation and intervention as needed to protect the City's interest. These and other regulatory related activities will directly and indirectly affect the City's municipal electric system and its ability to contribute to the funding of City operations. EXHIBIT 3 Task Order 03-G Regulatory Services Monitoring Activities and Technical Support Task C allows RJC to augment Staff's efforts to process the wide range of information that is needed to keep up with activities at the PUC and ERCOT and to support staff in addressing the many issues that arise as the market changes. In addition to reporting on on-going activities at the PUC and ERCOT, RJC will provide technical assistance to answer questions staff may have for their evaluation of the impact on the City of various issues and in responding to questions from the Utility Board and City Council. Following is a detail list of services to be provided under this Task Order. Scope of Services TaskA PUC Regulatory Support Task A-1 Attending Workshops And Hearings At PIJC 1. RJC will stay informed on activities at the PUC and will attend workshops and hearings as needed. 2. When appropriate, RJC will participate in workshops and hearings to represent interests of City based on directions of Staff. 3. RJC will work with Staff in developing positions which should be taken and strategies for working with parties involved. Task A-2 Analyze Proposed Rules and Policies 1. Proposed new rules and rule changes from the PUC will be analyzed. 2. RJC will discuss proposed new rules, and changes to existing rules with Staff and legal counsel, helping to identify areas of concern and preparing positions that represent the interests of the City. 3. ILIC will meet with PUC staff and other parties as appropriate to discuss proposed rules, and present the City's concerns regarding such proposals. Task A-3 Preparation of comments 1. KIC will prepare or assist in preparing comments to be filed with the PUC representing City's position on issues brought up in proposed rules, projects and dockets. 2. These comments will be coordinated through Staffand the City's legal team. 3. RJC will assist the City's legal team as necessary in the preparation and filing of comments and testimony in dockets that have been identified by Staff as requiring intervention to protect the City's interest. 2 of 4 Task Order 03-G Regulatory Services TaskB Assistance With ERCOT Task B-1 Attending Committee and Working Group Meetings At ERCOT 1. RJC will stay informed on activities at the ERCOT Independent System Operator (ISO) and will attend meetings as directed. 2. RJC will participate in discussions in meetings to represent interests of City based on directions of Staff. 3. RJC will work with Staff in developing positions which should be taken and strategies for working with other ERCOT stakeholders. Task B-2 Analyze Proposed Policies and Protocols 1. Proposed new policies and protocols from the ISO will be analyzed. 2. RJC will review proposed protocols with Staff, to identify areas of concern and prepare responses that represent the position of the City on the issues before the committees. 4. PUC will meet with ERCOT staff and other stakeholders to discuss proposed protocols, and negotiate reconciliation of concerns. TaskB-3 Preparation of Comments 1. RJC will prepare or assist in preparing whitepapers and comments to be submitted to the committees and be prepared to present such papers to represent the City's position on issues. 2. These papers and comments will be coordinated through Staff arid when necessary, the City's legal team. .Task C Provide Staff With Technical Assistance On Competitive Issues Task C-i Technical Assistance RJC will provide, as directed, technical support to help quantify impact of'issues affecting DME. Examples of such issues may include analysis of the impact on the City of a move to LMP pricing in ERCOT. Task C-2 Industry Monitoring and Evaluation 1. PUC will have continuing communication with Staff and the City's legal team in order to monitor proposed industry changes and address those issues affecting municipalities. 3of4 Task Order 03-G Regulatory Services 2. An on-going dialog will be maintained with Staff and the legal team in order to evaluate changing operating and market requirements and conditions, and evaluate potential effects on City operations. 3. Information necessary to supplement and support the decision making process will be provided as requested. 4. A summary of activities at the PUC and ERCOT will be provided weekly. Budget RIC recommends a not to exceed budget of $45,000 for labor and expenses. This budget will not be exceeded without the prior written approval of the City. RJC will bill monthly with supporting documentation of activities performed. The work being performed will be under the supervision of the Director of Electric Utilities and may be modified at any time upon appropriate notice to RJC. EXECUTED this · day of August, 2003. AUTHORIZED BY: ACCEPTED BY: CITY OF DENTON, TEXAS A Texas Municipal Corporation R.J. COVINGTON CONSULTING, LLC By' Dated: ATTEST: JENNIFER WALTERS CITY SECRETARY By: Dated: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY CITY ATTORNEY Dated: &[~) S:'~Our Documems~Con~racls',03\R J Cov[nglon TO No. 03-0 2003-Regulatory Support-DME. do¢ 4 of 4 AGENDA INFORMATION SHEET AGENDA DATE: August 19, 2003 DEPARTMENT: CM/DCM/ACM: Public Transportation Jon Fortune, Assistant City Manager SUBJECT: Consider adoption of an ordinance authorizing the City Manager, or his designee, to file an application, execute grants, and subsequent amendments with the U. S. Department of Transportation Federal Transit Administration and the Texas Department of Transportation for grams authorized by 49 U.S.C. §5307, and other applicable laws; and providing for an effective date. BACKGROUND: The City of Demon provides public transportation services in the Demon urbanized area to the general public and disabled persons on LINK (formerly the Demon Public Transit System). McDonald Transit, Inc operates the transit system. LINK provides both fixed route and demand response services six days a week. The Federal Transit Administration (FTA), the Texas Departmem of Transportation (TxDOT), and the City of Demon provide funding, on a percemage basis, for the transit service. The attached ordinance authorizes the City Manager to file a gram application with the FTA and TxDOT to execute the grant upon final award. The estimated total amount of the eligible project cost is approximately $1,200,000. This amount may fluctuate based on allocations that are determined via the 2000 Census Data. ESTIMATED SCHEDULE OF PROJECT: Application for these funds will be submitted following Council approval and award is expected from the FTA and TxDOT within thirty days of submission. Funds awarded in this gram will be used to operate the public transit system for FY 2004. PRIOR ACTION / REVIEW (Council, Boards, Commissions): None. FISCAL INFORMATION: Under this agreement operating funds will be available at a 50/50 (50% Federal and 50% State / local) match while capital and preventive maintenance funds will be available at an 80/20 match. EXHIBITS: Proposed Ordinance Respectfully Submitted: Mark Nelson Director of Airport and Transit Operations Prepared by: Stanley Nixon Public Transportation Manager S:\Our Documents\Ordinances\03XPublic Transit Grant Ordinance. doc ORDINANCE NO. AN ORDINANCE AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE, TO FILE AN APPLICATION, EXECUTE GRANTS AND SUBSEQUENT AMENDMENTS WITH ~ U.S. DEPARTMENT OF TRANSPORTATION FEDERAL TRANSIT ADMINISTRATION AND THE TEXAS DEPARTMENT OF TRANSPORTATION FOR GRANTS AUTHORIZED BY 49 U.S.C. §5307 AND OTHER APPLICABLE LAWS; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the Secretary of Transportation is authorized to award grants for mass transportation programs; and WHEREAS, the City is a recipient of US Department of Transportation Federal Transit Administration funds authorized by Congress under 49 USC §5307 and the City is authorized to make application for such funds in accordance with 49 USC §5301, et seq., the National Capital Transportation Act of 1969, as amended, the Transportation Efficiency Act for the 21~t century of 1998, as amended, and other applicable laws; and WHEREAS, the Grant Agreement, which incorporates the Federal Transit Administration's Master Agreement, if approved, will impose certain obligations upon the City of Denton, including providing local share project costs; and WHEREAS, the estimated total amount of the eligible project cost is approximately $1,000,000.00; and WHEREAS, the U.S. Department of Transportation requires, in accordance with the provisions of Titles VI and VII of the Civil Rights Act of 1964, as amended, that the applicant give an assurance that it will comply with Title VI of the Civil Rights Act of 1964 and the Department of Transportation requirements thereunder and other applicable federal laws and regulations; and WHEREAS, it is the goal of the apphcant that disadvantaged business enterprises be utilized to the fullest extent possible in connection with the project, and that definite procedures shall be established and administered to ensure that disadvantaged businesses shall have maximum construction contracts, supplies, equipment, contracts, or consultant and other services to the extent allowed by law; and WHEREAS, The State of Texas is authorized under Tex. Trans. Code Ch. 455, to assist the City in procuring federal aid for establishing and maintaining public and mass transportation projects; NOW, THEREFORE, THE COUNCIL OF THE C1TY OF DENTON HEREBY ORDAINS: ~qF. CTIONI 1_ The City Manager, or Ns designee, is authorized to file applications and execute grants and subsequent amendments on behalf of the City of Denton, Texas, with the U.S. Department of Transportation and the Texas Department of Transportation to aid in the financing of public transportation pursuant to 49 U.S.C. §5307. S.E.C_TID_72~ The City Manager, or his designee, is authorized to execute and file an assurance or any other docment required by the U.S. Department of Transportation effectuating the purpose of Titles VI and VII of the Civil Rights Act of 1964. ~ql:*,CTIC}N 3_ The City Manager, or his designee is authorized to furnish such additional information, assurances, or certifications as the U.S. Department of Transportation may require in connection with the program of projects. ~ql~,CTIC}N 4. The City Manager, or his designee, is authorized to set forth and execute disadvantaged business enterprise policies. Sg, CTION 5, The City Manager, or his designee is authorized to make an application with and then execute a Public Transportation Contract, and subsequent amendments, on behalf of the City of Denton, Texas, with the Texas Department of Transportation to aid in the financing of public transportation, and to execute any other certifications with the inclusion of other applicable laws, including discretionary funding, or documents which are necessary to implement the Contract, and to expend the necessary funds as may be required by the condition of the grant. ,qF, CTIONI fi_ This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ) 2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY EULINE BROCK, MAYOR BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: PAGE 2 AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: CM/DCM/ACM: August 19, 2003 Airport and Transit Operations Jon Fortune, Assistant City Manager SUBJECT Consider adoption of an ordinance establishing the fares to be charged for motor carrier passenger service provided by LINK; superceding ordinances in conflict with this ordinance; and providing for an effective date. BACKGROUND Since the inception of service in 1992, LINK has not increased fares, which curremly cover less than 10 percem of the overall cost of the service, in fact, the currem $0.75 per ride fare provides less than $90,000 in revenue, while overall capital and operating costs are more than $1.2 million for FY 03. In addition to a low recovery rate on fares and an increase of operating costs such as maimenance, fuel and operator's salaries, TxDOT has reduced the amoum of gram funds dispersed to the City by more than twenty percem since FY 99. Therefore, a fare increase of $0.25 is proposed to bring the overall individual fare to $1.00. This increase would provide needed revenues for the FY 04 LiNK Operations. LiNK staff recently ran an analysis examining the operation of public transportation service on three holidays; Memorial Day, July 4th and Labor Day. It was determined that only a nominal number of rides are provided on those days. Therefore, LiNK staff is proposing the elimination of Holiday Service that would provide an estimated savings of $5,500 for FY 04. Both the rate increase and the elimination of Memorial Day, July 4th, and Labor Day holiday service are being proposed in the 2003-04 Budget. OPTIONS Approve the proposed rate adjustmem and reduction of holiday service as proposed in the 2003-04 budget. 2. Provide staff direction with additional direction. RECOMMENDATION Staff recommends the approval of the proposed fare increase and the reduction of service. ESTIMATED SCHEDULE OF PROJECT The rate change would become effective October 1, 2003 and the reduction of holiday service would begin with Labor Day 2003. PRIOR ACTION/REVIEW LiNK staff has conducted a series of three public meetings for public commentary on the proposed changes. The City Attorney's Office has reviewed the changes. FISCAL INFORMATION LiNK staff estimates the fare increase to $1.00 will provide approximately $25,000 in additional revenue based on current ridership projections. The elimination of service on the three holidays would provide a savings of approximately $5,500 per year. EXHIBITS Ordinance Exhibit Respectfully submitted: Mark Nelson Director of Airport and Transit Operations ORDINANCE NO. AN ORDINANCE OF THE CITY OF DENTON, TEXAS ESTABLISHING THE FARES TO BE CHARGED FOR MOTOR CARRIER PASSENGER SERVICE PROVIDED BY LINK; SUPERCEDING ORDINANCES IN CONFLICT WITH THIS ORDINANCE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City Council hereby finds and determines that it is advisable and in the public interest to establish new fares to be charged for motor carder passenger service provided by LINK; and WHEREAS, the City Council finds that such new fares are reasonable; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The findings and recitations contained in the preamble of this ordinance are incorporated herein by reference. SECTION 2. The fares to be charged by LINK for motor carder passenger service are hereby established as set forth in Exhibit "A" attached hereto and made a part hereof by reference (the "Fares"). The Fares are not applicable to the motor carrier passenger service provided for University North Texas and Texas Womans University under interlocal agreements between the City and those entities. SECTION 3. All ordinances in conflict with this ordinance are hereby superceded by this ordinance. SECTION 4. This ordinance shall become effective immediately from and after its passage and approval. PASSED AND APPROVED this the day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS~r~ LEGAL FORM: BY: EULINE BROCK, MAYOR Exhibit A FIXED ROUTE FARES Adult (over 18 years) Single Trip $1.00 Book of 10 $10.00 Monthly Pass $31.00 (unlimited trips) Children 6-18 years $0.50 Under 6 years Free (must be accompanied by a fare-paying passenger) Senior citizens, persons with disabilities & Medicare card holders Medicare card or photo ID that certifies age 60+ or disability is required Single Trip $0.50 MUST BE APPROVED BY LINK ADA single trip passes Single Trip $2,00 Book of 10 $20.00 MUST BE APPROVED BY LINK Transfers between routes Free AGENDA DATE: DEPARTMENT: CM/DCM/ACM: AGENDA INFORMATION SHEET August 19, 2003 Engineering Jon Fortune, Assistant City Manager SUBJECT Consider approval of an Ordinance of the City of DeNon, Texas approving the City's participation for itself, and on behalf of Denton County under an Interlocal Agreement between the City and Denton County, in the Texas Department of Transportation Off-system Bridge Replacemem Program ("Program") as authorized by Texas Administrative Code, Title 43, Section 15.55(d); authorizing the City Manager or his designee to execute on behalf of the City and County all documents or agreements necessary to carry out the Program; and providing an effective date. BACKGROUND "Off-system bridges" are existing bridges located on public roads and streets off the designated state highway system. The federal off-system bridge program in Texas is administered by the Texas Department of Transportation ("TxDOT") to replace or rehabilitate structurally deficient and functionally obsolete (collectively referred to as deficiem) bridges. The usual participation ratios for the off-system bridge replacemem (or rehabilitation) program is 80-percem federal funds, 10-percem state funds, and 10-percem local funds. Texas Administrative Code, Title 43, Section 15.55(d) (43 TAC Section 15.55(d)) provides that under specific conditions the 1 O-percent Local Government match fund participation requirement may be waived with agreemem by the Local Governmem to perform, or cause to be performed, an equivalent dollar amount of structural improvement work on other deficient off-system bridges or deficiem mainlane cross-drainage structures along school bus routes within its jurisdiction. The City of DeNon will construct a bridge structure and drainage improvemems for Mayhill Road at Pecan Creek which will remove Mayhill Road from the Pecan Creek floodplain and improve local drainage. TxDOT has determined that this project qualifies as an equivalem match project. This project provides approximately $1,109,920 as City of DeNon 10-percem participating funds under the federal off-system bridge replacemem (or rehabilitation) program. The City of DeNon match funds provide the opportunity for approximately $11,099,200 off-system bridge replacemem (or rehabilitation) improvemems. The City of' DeNon has the following off-system bridges eligible for replacemem under the federal bridge program, using the Mayhill Road Improvemems at Pecan Creek equivalem match project funds (Table 1). Page 1 Table 1 - TxDOT Off-System Bridge Replacement Projects in City Limits Eligible for TxDOT Funding Agreements Bridge Estimated Estimated Project Construction City Match Location Cost Required Mayhill Road at Cooper Creek $239,182 $23,918 Frame Street at Pecan Creek $224,630 $22,463 Bonnie Brae Road at Hickory Creek $418,662 $41,866 Bonnie Brae Road at Roark Branch $190,674 $19,067 Bonnie Brae Road at Dry Fork Creek $292,541 $29,254 TOTALS $1,365,689 $136,569 Match Funds Available ............. $1,109,920 Match Funds Unused ............. $973,351 As seen in Table 1, Match Funds Unused amoum is more than $900,000, based on TxDOT estimated costs for bridge replacemems. The federal bridge replacemem program does not allow "banking" of leftover match funds for future City projects. Match funds available but not included in Bridge Replacemem Funding Agreements with TxDOT prior to letting the Mayhill Road Improvemems at Pecan Creek Project will be lost. These unused match funds cannot provide a direct benefit to City of DeNon residems. TxDOT has determined that the unused City match funds are eligible for off-system bridge replacemem projects in DeNon County if the City and County have entered into an Interlocal Cooperative Agreement. The engineering Department believes the actual construction costs for the Bonnie Brae Road at Hickory Creek and Bonnie Brae Road at Dry Fork Hickory Creek Bridges will significamly exceed the estimates by TxDOT, after reviewing the floodway widths at these locations. The City's matching fund obligations will be adjusted, based on actual construction costs. This could reduce or eliminate the funds available for City or DeNon County projects under this program. The City may emer imo a separate agreemem with TxDOT using another eligible match project if it is determined that insufficiem match funds are available to complete the City's bridge projects. On August 5, 2003 the City Council approved Ordinance No. 2003-237 authorizing the Mayor to execute an Interlocal Cooperation Agreement between the City Of Denton, Texas and Denton County, Texas for the Texas Department Of Transportation Off System-Bridge Replacement Program. The Imerlocal Cooperation Agreemem will establish funding priority for City of DeNon bridge replacemem projects over DeNon County projects. The Agreemem also provides that the City of DeNon will administer this Program with TxDOT on behalf of the City and County. TxDOT and DeNon County have idemified the following eligible DeNon County bridge replacemem projects within DeNon County for inclusion in the Imerlocal Cooperative Agreemem (Table 2). Construction costs shown in Table 2 were estimated by TxDOT. Page 2 Table 2 - TxDOT Off-System Bridge Replacement Projects in Denton County Eligible for TxDOT Funding Agreements Denton County Bridge Estimated Estimated Project Construction City Match Location Cost Required Sam Bass Road at Clear Creek $ 792,175 $ 79,218 John Paine Road at Roark Branch ** $ 244,033 $ 24,403 Nicholson Road at Clear Creek ** $ 806,728 $ 80,673 Indian Trail Road at Behnke Branch $195,525 $19,552 Friendship Road at Pecan Creek $ 292,541 $ 29,254 Huling Road at Pond Creek $190,674 $19,067 Pruett Road at Carson Creek $ 229,480 $ 22,948 Reik Road at S. Hickory Creek $ 370,154 $ 37,015 TOTALS $3,121,310 $312,131 Match Funds Available from City ............. $934,266 Match Funds Unused ............. $622,135 ** Within Denton ETJ The unused City match funds will provide match funds for the Denton County bridges listed in Table 2 to the extent possible. The City benefits from having replaced County bridges in the ETJ, which may become City responsibilities upon annexation. The City also benefits from good will generated with Denton County. Our citizens receive benefits of safer bridges and reduced flooding hazards. This Agenda Item is to consider approval of an Ordinance of the City of Denton, Texas approving the City' s participation for itself, and on behalf of Denton County under an Interlocal Agreement between the City and Denton County, in the Texas Department of Transportation Off-system Bridge Replacement Program ("Program") as authorized by Texas Administrative Code, Title 43, Section 15.55(d); authorizing the City Manager or his designee to execute on behalf of the City and County all documents or agreements necessary to carry out the Program; and providing an effective date. Attachment 1 is a copy of the proposed Ordinance. OPTIONS Approve the Ordinance. Postpone consideration of the Ordinance request. Disapprove the Ordinance. RECOMMENDATION Staff recommends approval of the Ordinance. Page 3 PRIOR ACTION/REVIEW On August 5, 2003 the City Council approved Ordinance No. 2003-237 authorizing the Mayor to execute an Interlocal Cooperation Agreement between the City Of Denton, Texas and Denton County, Texas for the Texas Department Of Transportation Off System-Bridge Replacement Program. FISCAL INFORMATION This Ordinance would authorize the City Manager or his designee to emer imo a funding agreemem with TxDOT for each bridge structure listed in Table 1 or Table 2. The Ordinance does not authorize cash payments from the City as match funds to TxDOT as such payments are not required under this funding program. The City would be responsible for obtaining right-of-way and assume costs to arrange for relocating milities for each bridge replacemem project located within the City. DeNon County would have these responsibilities for bridges in the County. TxDOT does not pay for right-of- way or mility relocations under any circumstances. Requiremems for right-of-way and mility relocations are idemified during the project design phase, vary depending on site conditions, and cannot be estimated at this time. Should these costs become prohibitive to the City, the City can delay or abandon bridge replacemem. There would also be administrative costs for the off- system bridge replacement program to provide contract compliance data and documentation to TxDOT. The administrative costs cannot be estimated at this time, as the City has no prior experience with this program. ATTACHMENTS 1. Ordinance Prepared By: Sr. Engineer, Transportation & Drainage Edward F. Witkowski, Jr. Respectfully submitted: Director of Engineering Charles Fiedler Page 4 ORDINANCE NO. AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING THE CITY'S PARTICIPATION FOR ITSELF, AND ON BEHALF OF DENTON COUNTY UNDER AN INTERLOCAL AGREEMENT BETWEEN THE CITY AND DENTON COUNTY, IN THE TEXAS DEPARTMENT OF TRANSPORTATION OFF-SYSTEM BRIDGE REPLACEMENT PROGRAM AS AUTHORIZED BY TEXAS ADMINISTRATIVE CODE, TITLE 43, SECTION 15.55(D); AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO EXECUTE ON BEHALF OF THE CITY AND COUNTY ALL DOCUMENTS OR AGREEMENTS NECESSARY TO CARRY OUT THE PROGRAM; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the federal off-system bridge program is administered by the Texas Department of Transportation (the "State") to replace or rehabilitate structurally deficient and functionally obsolete (collectively referred to as deficient) bridges located on public roads and streets off the designated state highway systems (the "State Program"); and WHEREAS, the City of Denton and Denton County have entered into an Interlocal Agreement authorized by Ordinance No. 2003-237 (the "Interlocal Agreement") which identifies the City of Denton as the Local Government administrator with the State on behalf of the City and Denton County for the State Program with respect to the bridges identified in this ordinance; and WHEREAS, the City of Denton owns the following bridges: Owner Control National Bridge At At Stream Entity: Section Job Inventory (NBI) Roadway: Crossing: No. (CS J): Number: City of Denton 0918-46-041 B05224-001 City of Denton 0918-46-094 AA0510-003 City of Denton 0918-46-167 B03260-001 City of Denton 0918-46-949 AA0510~002 City of Denton 0918-46-952 AA0510-001 Mayhill Road Bonnie Brae Street Frame Street Bonnie Brae Street Bonnie Brae Street Cooper Creek Roark Branch Pecan Creek Hickory Creek Dry Fork Creek WHEREAS, Denton County owns the following bridges: Owner Entity: Control National Bridge At Section Job Inventory (NBI) Roadway: No. (CS J): Number: At Stream Crossing: Denton Denton Denton Denton Denton Denton Denton Denton County County County County County County County County 0918-46-901 0918-46-922 0918-46-951 0918-46~933 0918-46-950 0918-46-102 0918-46-909 0918-46-948 AA0152-002 A_A0521-001 AA018%001 AA0130-001 AA0262-001 AA0209-00 t A_A0125-001 AA0199-001 Sam Bass Road John Paine Road Nicholson Road Indian Trail Road Friendship Road Huling Road Pruett Road Reik Road Clear Creek Roark Branch Clear Creek Behnke Branch Pecan Creek Pond Creek Carson Creek S. Hickory Creek WHEREAS, the 'projects to remedy the bridges listed above are included in the Intedocal Agreement and the currently approved program of projects as authorized by Texas Transportation Commission by specific Minute Orders; and WHEREAS, the usual fund participation ratio for projects on the State Program is 80 percent federal, 10 percent state and 10 percent Local Government; and WHEREAS, Texas Administrative Code, Title 43, Section 15.55(d) (43 TAC Section 15.55(d)) provides that under specified conditions the 10 percent Local Government match fund participation requirement may be waived with agreement by the Local Government to perform, or caused to be performed, an equivalent dollar amount of structural improvement work on other deficient bridges or deficient mainlane cross- drainage structures within its jurisdiction, such a project of structural improvement work being referred to as an "equivalent-match project"; and WHEREAS, the State has estimated the local match fund participation requirement for the approved federal off-system bridge projects listed above at $448,700, hereinafter referred to as the "participation-waived" contract amount, such participation requirement the City of Denton for itself and on behalf of Denton County under the Interlocal Agreement proposes be waived and in return perform or cause to be performed equivalent-match project structural improvement work; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON, TEXAS HEREBY ORDAINS: SECTION 1. The City of Denton acknowledges its obligation to conform with all conditions of 43 TAC Section 15.55(d); such conditions that include, but are not restricted to the following: 1. The Local Government must be currently in comphance with load posting and closure regulations as def'med in National Bridge Inspection Standards under US Code of Federal Regulations, Title 23, Section 650.303. 2. The equivalent-match project work increases the load capacity of the existing bridge or other mainlane cross-drainage structure, or upgrades the structure to its original load capacity with a minimum upgrade to safely carry school bus loading if located on a school bus route. 3. In performing, or causing to be performed, the equivalent-match project(s), the City of Denton assumes alt responsibilities for engineering and construction, and complying with all applicable state and federal environmental regulations and permitting requirements for the structures being improved. 4. The work on the proposed equivalent-match project(s) has not begun and will not begin until the local match fund participation waiver approval process has been completed. Page 2 5. The City of Denton will be allowed three years after the contract award of the participation-waived projects to complete the structural improvement work on the equivalent-match proj ect(s). 6. Should this waiver request be approved, an appropriate written agreement or amendment to a previously executed agreement will be executed between the State and the City of Denton. SECTION 2. The City Manager or his designee is hereby authorized to execute on behalf of the City of Denton and Denton County under the Interlocal Agreement all documents or Agreements necessary to carry out the State Program and participation waived projects and contract amounts. SECTION 3. This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY EULINE BROCK, MAYOR BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: ~ Page 3 AGENDA INFORMATION SHEET AGENDA DATE: August 19, 2003 DEPARTMENT: CM/DCM/ACM: Engineering Jon Fortune, Assistant City Manager SUBJECT Consider adoption of an ordinance correcting and amending Ordinance No. 2002-408 pertaining to the acquisition of certain real property imerests through purchase or condemnation proceedings, such real property being a part of the M.T. Cole property described in a deed recorded in volume 249, page 387 of the Deed Records of Denton County, Texas, located in the B.B.B. and C.R.R. Survey, Abstract No. 176, the J. Kjelberg Survey Abstract No. 1610, the J. Bacon Survey Abstract No. 1540, the I. Hembrie Survey Abstract No. 594, and the I. Byerly Survey Abstract No. 1458, Demon County, Texas; Declaring an effective date. (West Electric Project) BACKGROUND This ordinance is an amendmem to Ordinance 2002-408 which authorized the purchase or condemnation of the electric easement on the MT Cole property. It is necessary to amend the original ordinance to correct minor errors in the legal description. The overall easement area has not changed. OPTIONS 1. Approve the ordinance, or 2. Denial, or 3. Table for future consideration RECOMMENDATION Staff recommends approval of the ordinance. ESTIMATED PROJECT SCHEDULE Demon West Electrical Utility project to be initiated upon possession of necessary parcels, Estimated in October, 2003. PRIOR ACTION/REVIEW None FISCAL INFORMATION John G. Hirschy and Associates performed the appraisals of all of the necessary electrical utility easements for this project. Based on this appraisal, The City of Denton Real Estate Division forwarded an initial offer of $42,312.00 to the landowner. In accordance with Texas Property Code 21.0111, the appraisal has been made available to the landowner. Offer is based on the following methodology: 1.31 acre tract. A 75% compensation factor is being utilized. 1.31 acre X $4,100/acre X 0.75 = $4,028.00 16.30 acre tract of which 3.85 acre is in public right-of-way leaving 12.45 acre actual easement remaining. A 75% compensation factor is being utilized. 12.45 acre X $4,100/acre X 0.75 = $38,284.00 ATTACHMENTS Location map Draft ordinance Exhibits Prepared By: Respectfully submitted: Tod J. Taylor Real Estate Specialist Charles Fiedler, Director Engineering Department M. T. Cole Property Electrical Utility Easement Location Map ORDINANCE NO. AN ORDINANCE CORRECTING AND AMENDING ORDINANCE NO. 2002-408 PERTAINING TO THE ACQUISITION OF CERTAIN REAL PROPERTY INTERESTS THROUGH PURCHASE OR CONDEMNATION PROCEEDINGS, SUCH REAL PROPERTY BEING A PART OF THE M.T. COLE PROPERTY DESCRIBED IN A DEED RECORDED IN VOLUME 249, PAGE 387 OF THE DEED RECORDS OF DENTON COUNTY, TEXAS, LOCATED IN THE B.B.B. AND C.R.R. SURVEY, ABSTRACT NO. 176, THE J. KJELBERG SURVEY ABSTRACT NO. 1610, THE J. BACON SURVEY ABSTRACT NO. 1540, THE I. HEMBRIE SURVEY ABSTRACT NO. 594, AND THE I. BYERLY SURVEY ABSTRACT NO. 1458, DENTON COUNTY, TEXAS; DECLARING AN EFFECTIVE DATE. (WEST ELECTRIC PROJECT) WHEREAS, pursuant to Ordinance No. 2002-408 condemnation proceedings were authorized by the City Council; and WHEREAS, the City and the Owner of the subject property were unable to agree on compensation and damages; and WHEREAS, on or about May 5, 2003 condemnation proceedings were instituted in the Probate Court of Denton County, Texas under Case No. ED-2003-0089 (the "Condemnation Proceedings"); and WHEREAS, after the commencement of the Condemnation Proceedings it was discovered that the legal descriptions of the property being acquired and attached as Exhibits "A" and "B" to Ordinance No. 2002-408 contained minor errors; and WHEREAS, the City Council finds that it is in the pubhc interest to correct the errors in the legal descriptions; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The findings and recitations contained in the preamble of this ordinance are incorporated herein by reference. SECTION 2. Ordinance No. 2002-408 is hereby amended by replacing Exhibits "A" and "B" with the Exhibits "A" and "B" attached hereto and made a part hereof by reference. All other provisions of Ordinance No. 2002-408 not correcting herein shall remain in full force and effect. SECTION 3. This ordinance shall become effective immediately upon its passage and approval. PASSED AN-l) APPROVED this the day of ,2003. EULINE BROCK, M3kYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: '~ Page 2 Exh'ib(t A' All that certain lot, tract, or parcel situated in the B.B~B. and C.R.R. Survey Abstract Number 176, Denton County, Texas, and being a part oftbe M.T. Cole Tract described in the deed recorded in Volume 249, Page 387, of the Deed Records of Denton County, Texas and the subject tract being more particularly described as follows; BEGINNING at the Southwest comer of a Transmission line easement described in the deed recorded in Volume 009, Page 227, oftbe Deed Records of Denton County, Texas, and being Station 347+89.74 of Farm-to-Market RoM Number 2449; THENCE South 89 Degrees 44 Minutes 01 Seconds West along or near a fence in the North right-of-way line of said Road a distance of 472.05 feet to a point for comer, TftENCE North 00 Degree 11 Minutes 26 Seconds West a distance of 12~.00 feet to a point for .comer; THENCE North 89 Degrees 43 Minutes 59 Seconds East a distance of 471.91 feet to a point for comer; THENCE South 00 Degree 16 Minutes 01 Seconds East a distance of 21.14 feet to a point for comer; THENCE South 89 Degrees 43 Minutes 59 Seconds West a'distance of 88.86 feet to a point for comer;, THENCE South 00 Degree 16 Minutes 01 Seconds East a distance of 20.00 feet to a point for comer; THENCE North 89 Degrees 43 Minutes 59 Seconds East a distance of 88.86 feet to a point for comer; THENCE South 00 Degree 16 Minutes 01 Seconds East a distance of $3.$6 feet to The PLACE OF BEGINNING, and containing 1.31 acres more or less; This Plat correctly represents the results of an on-the-ground survey made under my direction and supervision on 06-13-01. There are no visible or apparent intrusions, protrusions or easements except as shown hereon. ER R.P.L.S. No 5312 Date Exhibit "B" ~mbe~'14~ rn t~ D~on C~y, Texa~ ~d ~ a p~tm ~ M.T.Co~ Tract ~s~r~d In tho deed r~c~ded ~ Vo~me 2~9, P~e 38~, o~ the Deed R~ds o~ ~n~ ~:ty, T~xas. ~ subj~t ~L being mare parti~rl7 de~r~ed os ~EG~G at a ~i~t ~ ~¢ ccnt~line lnLer~ec~ ef O~er~ad RGQd ~d S~ng ~ Road said ~iat be~s ~89 D~es ~4 Mi~tes 01 , c~ed ~ ~re trect in the D~t~ Survey ~ ~ No, theft c~ner al ~ ~T. C~ T~t d~ri~ ~ V~i 24~ Page ~7; T~N~ ~ ar ~ar ~ c~t~e of ~e~d ~ the f~ S~th O0 Degre~ 02 ~es ~ ~ East a ~sto~c of 2096~6 feet to a ~int f~ S~Lh O7 Degrees 30 ~tee 38 ~s West a d~t~ce of 94.27 feet to a po~nt for comer; South 12 Degrees 02 ~tas 42 Se~fld~ We~t e ~stance of 7t03 feel.. to a ~bt for c~ner; ~uth 07 Oegr~s ~ ~l~tee 17 Sects Wesg.a dbtOnce of 127.71 feel to ~ po~t for comer: S~th O0 Degree 12 Ui~tes 51 Seconds West a ~t~ca o~ ~4~23 ~eet ~o o ~t ~or corn~ ,' S~ O~ D~ees ~ U~tee 27 Sects E~ a d[st~e of ~.~ ~t to a point for c~r~ South ~ ~ees 27 ~tes I4 Set,ds E~t a distance of 57.88 [eot ~o a poiat for cor~; S~th O1 ~s {3 M~es ~ ~nds East a ~s~e of 43.~8 fea~ to a po~t fo~ Sou~ 02 De~ees 3~ ~nutes lg Sec~ds Wes~ o dlst~ce of ~3.35 feet to a point far c~fler; Sou~ 03 De~ees 31 ~nutes 44 $ecends West = d~st~ce O( .g8.5'2 fee~ to e p~n[ for c~ ;: ~th O~D~rees 31 ~t~ ~ Seconds ~est a ~sta~e ef 112.~ fee~ S~ 04 Oegreea 53 Ml~t~ O0 ~co~s We~t a di~t~e of 214.44 feet to ~ ~lnt f~ ~r; S~th O~ Oegre~ 01 M~tes 05 Set,ds West a dlst~e of 174.44 ~o a ~int f~ corner; S~th 03 De~s dg Minutes ~ Secen~ WeSt o ~st~ee of 329.07 feet to a paint for c~me~; TH~CE 8ouCh ~ ~r~s ~4 ~nute= 07 ~onds West a ~s{~e of 1002.42 feet to a ~int far eor~r In the Nor~ I~ o~ a Te~ Uu~cipa~ Pow~ Agency tr~mtssl~ ~ ~s~nt deseel~ ~ V~e 5, P~ 706, of the Lis P~d~s Records of ~nt~ Co~ty, Texas a~ ~th the North fine of sa~ easement t~ fo~ow~g c~s ~ distances; North 89 De~aes 35 ~t~ ~2 Sects West e ~s~ance o~ 83.90 to o ~int I~ cor~; ' North 50 D~ 34 Minutes 51 Seco~s Wast o distance of 84~3g fe~t to o po~t for co.er: to o point for c~ne~ : Nor~ 89 Oegrees*2g Ml~es ~9 Sounds West a ~ta~e of 2791.54 feet to a point for ¢~ner; .. S~th 89 Degrees ~3 ~nutes 5g Se~nds Wes~ a ~lt~e a~ 2425.18 feet to a 'poi~t g~ cornw; TH~ ~th ~ D~fees 31 ~te~ ~ Sects Ess{ ~ the North line of s~d E~e~ a d~st~e of ~.8~ feet taa ~t for TH~N~E North Bg ~9rees 52 ~tes 16 ~conds East a ~sta~e of 2589.20 deer to a po~t r~ THE~ South 8g De~ees 2e Ui~tes ~ $ecan~ East a as~a~e o~ 4070.26 feet to o ~Int far corner; TH~N~ ~r~h O~ De~ees 09 MIn~te= 55 ~nde Cast a ~st~e af 481~99 feat La a ~inl for c~ner; T~N~ Sou~h 8g ~ees 44 U~tes 01 ~on~ East O ~stance of .- ~07 feet ~0 ~ PLA~ ~ ~N~G and eont~ 16.30 a~es o~ ' mere or leas of wh~h 3.85 ~es ~e8 In ~w~ Ro~ Th~ ~et e~r~t~ r~r~ts t~ re~ts of ~ ~l~-~ survey made ~ my ~tlnn ~ s~vil~fl ~ 1~-~-~+ ~1 A. ~ R.P~& ~o 5312 ~to ' .i AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Economic Development Mike Conduff, City Manager ~,r~/-~ SUBJECT CONSIDER ADOPTION OF A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, REPLACING A POLICY FOR TAX ABATEMENT FOR THE CITY OF DENTON TO ESTABLISH GUIDELINES AND CRITERIA GOVERNING TAX ABATEMENT AGREEMENTS; AND DECLARING AN EFFECTIVE DATE. BACKGROUND The City of Denton first adopted a Tax Abatement Policy in 1989. In accordance of Chapter 312 of the Texas Tax Code, we must have a policy in place in order to conduct any tax abatement activities, such as creating reinvestment zones or entering into tax abatement agreements. Tax abatement policies are good for two years and must be readopted or replaced. Our recent tax abatement policy was modified in May 2001. As in the original policy, the May document included references to the Denton Independent School District. A September 2001 state law prohibits school districts from participating in tax abatements. Therefore, all references to the Denton lSD have been removed from the document presented for adoption. No other changes have been made. A review of all economic development policies will begin after the creation of the Economic Development Partnership (EDP) Board. The EDP may recommend changes to this document at that time. PRIOR ACTION/REVIEW Since the only change to the document is the deletion of references to the Denton lSD, the Joint Tax Abatement Committee was not asked to review the document. FISCAL INFORMATION N/A EXHIBITS Resolution Respectfully submitted: Linda Ratliff, Director Economic Development Department RESOLUTION NO. A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF DENTON, TEXAS, REPLACING A POLICY FOR TAX ABATEMENT FOR THE CITY OF DENTON TO ESTABLISH GUIDELINES AND CRITERIA GOVERNING TAX ABATEMENT AGREEMENTS; AND DECLARING AN EFFECTIVE DATE. WHEREAS, on June 6, 2000, the City Council adopted guidelines and criteria, known as the Denton Policy for Tax Abatement (sometimes referred to as "Tax Abatement Policy"), passing by Resolution No. R2000-028; and WHEREAS, on May 1, 2001, the City Council amended the to allow waiver of the five million dollar threshold and the maximum tax abatement percentage; to define professional positions; to make other changes as set forth in the amended policy; and WHEREAS, the City Council desires to promote economic development within Denton; and WHEREAS, providing tax abatement and other economic development incentives within the City and its extraterritorial jurisdiction will likely contribute to the economic development of Denton by encouraging major investment and the creation of jobs; and WHEREAS, the Property Development and Tax Abatement Act, Chapter 312 of the Tex. Tax Code, allows the city to establish its own criteria for tax abatement and the City has previously adopted guidelines for tax abatement and resolutions No. R_90-018, R98-004, R2000- 028 and R2001-020; and WHEREAS, the City Council deems it in the public interest to continue to be eligible for participation in tax abatement and to adopt pohcies, guidelines and criteria governing tax abatement agreements to be known as the Tax Abatement Policy; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: SECTION 1. That the polices, guidelines and criteria found in the Denton Policy for Tax Abatement, attached hereto as Exhibit A and made a part of this Resolution and incorporated herein for all purposes, are in all things approved and adopted. From and after the effective date of this Resolution, the attached Denton Policy for Tax Abatement shall constitute policy guidelines and criteria governing tax abatement agreements for the City of Denton in accordance with Chapter 312 of the Tex. Tax Code. SECTION 2. That pursuant to Tex. Tax Code Section 312.002(c) the guidelines and criteria adopted herein shall be effective for two (2) years, during which time the guidelines may be amended or repealed by a vote of~ of the members of the Council. S:V3m' Do~me~s~.~olu~mt.-~O3\T~c~ Al~lemm~ Fo]i~y ~+1 SECTION3. That the City Council hereby reasserts its decision to become eligible to participate in tax abatement. The City Council provides certain tax incentives applicable to business enterprises in various reinvestment zones which are established in the City, in accordance with the applicable provisions of Chapter 312 of the Tex. Tax Code and in accordance with the guidelines and criteria established in the attached Exhibit A and in the amended Tax Abatement Policy. SECTION 4. That this resolution shall become effective immediately upon its passage and approval at the regular meeting of the City Council of the City of Denton, Texas, on the 19th day of August, 2003, at which meeting.a quorum was present and which meeting was held in accordance with the provisions ofTex. Gov.'t Code §551.001, et seq. PASSED AND APPROVED this the day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY EULINEBROCK, MAYOR BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: '~ Page 2 of 2 Exhibit A DENTON POLICY FOR TAX ABATEMENT I. GENERAL PURPOSE AND OBJECTIVES The City of Denton (City) is committed to the promotion of high quality development in all parts of the city and to an ongoing improvement in the quality of life for its citizens. Insofar as these objectives are generally served by the enhancement and expansion of the local economy, the City will, on a case-by-case basis, give consideration to providing tax abatement as a stimulus for economic development in Denton. It is the policy of the City that said consideration will be provided in accordance with the procedures and criteria outlined in this document. Nothing herein shall imply or suggest that the City is under any obligation to provide tax abatement to any applicant. Denton County ad valorem taxes also may be abated; however, applications will be considered separately under the guidelines of the Denton County tax abatement policy. All applicants shall be considered on a Case-by-case basis. Abatements will be considered only as inducements to generate development that otherwise would not occur. Abatements will not be considered if construction of a proj eot already has begun. Tax abatements, as described in this policy, will be available for new and/or existing facilities and structures and for businesses wanting to locate, expand or modernize basic industries, corporate office headquarters or distribution centers, except as this pohcy may be limited for property described in Section 312.211(a) of the Texas Property Tax Code (Vemons Texas Civil Statutes Annotated, hereinafter referred to as "Tax Code.") II. JOINT TAX ABATEMENT COMMITTEE Requests for tax abatement shall be reviewed by the Joint Committee on Tax Abatement, said Committee being comprised of two elected officials each from the City and Denton County. One additional staff person from each jurisdiction shall be appointed to serve as a nonvoting, ex officio member of the committee. The Joint Committee on Tax Abatement serves as a recommending body to the taxing entities regarding whether economic development incentives should be offered in each individual case. Its recommendation shall be based upon an evaluation of information submitted in the tax abatement application and any additional information requested by the Committee or presented to the Committee. The Tax Abatement Application is presented as Exhibit A of this policy. All meetings of the Joint Committee shall be held in compliance with the Texas Open Meetings Act, Chapter 551 of the Texas Government Code. IH. VALUE OF INCENTIVES Tax Abatement Policy July 2003 - 1 - The criteria outlined in the Application will be used by the Joint Committee on Tax Abatement in determining whether or not it is in the best interests of the affected taxing entities to recommend that tax abatement be offered to a particular project. Specific considerations will include the degree to which the individual project furthers the goals and objectives of the community as described in the Denton Comprehensive Plan, as well as the relative impact of the project. New, expanding and modernizing businesses may be considered for abatement if the minimum threshold, as described in Table 1 below, is met. Once a determination has been made that tax abatement should be offered, the value and term of the abatement may be detennined by referencing the following table: TABLE 1: Establishes a framework for considering the length of abatement according t.o assessed real property value of improvements and of tangible personal property located on the real property. VALUE OF STRUCTURE AND PERSONAL PROPERTY YEARS OF PERCENTAGE OF IN MIl ,LION DOLLARS ABATEMENT ABATEMENT 100 10 15- 25% 80 9 15- 25% 65 8 15- 25% 50 7 15- 25% 35 6 15- 25% 20 5 15- 25% 15 4 15-25% 10 3 15- 25% 5 2 15-25% To qualify, companies must meet the minimum threshold of the policy in the first 24 months from the execution of the agreement or as specified in the tax abatement agreement. If upon initial application a project qualifies for tax abatement under the guidelines set forth in this policy, the taxing entities may consider granting an additional 5% abatement for each one of the following factors provided, however, that the total tax abatement does not exceed 50% annually or continue for a period of more than ten years. No applicant may receive credit for more than five of the following factors: · The project will occupy a building that has been vacant for at least two years; · The project will create high-skilled, high-paying jobs as documented by the applicant; (A breakdown of number of jobs per job classification and entry level wage per classification will be used to determine eligibility); · The project will involve a significant relationship with one of the two universities in Denton; · At least 25% of the new jobs created by the project will be filled by Denton residents; Tax Abatement PoIicyJuly 2003 - 2 - · The project will provide knowledge-based jobs (at least 25 percent of jobs require college bachelors degree at entry level); · The project will donate significant public art to the community. (To qualify, donation must be approved by Greater Denton Arts Council and City Council); · The project wilt donate significant materials/equipment to the public schools (To qualify, donation must be approved by DISD and City Council.); · The project will create improvements to the Denton Central Business District; · The project will result in the formation of a business park; · The project is an international or national headquarters facility. The total tax abatement may not exceed 50% annually for ten years. All abatements are subject to final approval of the City Council or the County Commissioner's Court. Even though a project may meet the criteria as set forth in this policy, an application may be denied at the discretion of the City. Tax abatement shall not apply to any portion of the land value of the project. The thresholds as described in Table 1 are considered guidelines for establishing the Tax Abatement Agreement terms. However, the City may determine that a lower or higher percentage and/or a shorter or longer term of abatement may be more appropriate for an individual project. If abatement is approved, the City may consider applying all or a portion of the abatement in the first year or during any shorter period within the term of the tax abatement agreement. For example, an approved abatement of 25 percent for four years may be applied as 100 percent abatement for one year. When the City of Denton determines that incentives are required to retain existing businesses which propose to improve or redevelop property within the City limits, the Denton City Council may consider these "special projects" on a case-by-case basis and reserve the fight to waive the minimum threshold and/or exceed fifty percent (50%) in tax abatement. The City of Denton may also take into consideration as "special projects" the expansion/redevelopment of existing businesses that create new or additional professional jobs. Abatement hereunder will only apply to the increased valuation of the improvements over the appraised value of the property prior to such improvements as same is established by the Denton Central Appraisal District the year in which the tax abatement agreement is executed. The City of Denton may also consider other tax incentives authorized by law. Professional jobs are defined as "occupations which require specialized and theoretical knowledge which is usually acquired through college training or through work experience and other training which provides comparable knowledge; a calling requiring specialized knowledge and often long and intensive academic preparation; requires some research, analysis, report writing and presentations. Special licensing, certification, or registration may be required to perform the job task; the work of professional positions is creative, analytical, evaluative, or interpretive, and is characterized by personal responsibility to keep abreast of and exercise judgment and broad perspective in the application of an organized body of knowledge that is constantly studied to make new discoveries and interpretations or to improve the data, materials and methods; may involve some supervision and budgeting/planning." When the City of Denton determines that abandoned property may require additional incentives to promote economic development that generally satisfies the requirements of this policy, the City may waive the min/mum threshold and/or exceed fiRy percent (50%) in tax abatement, or consider other tax incentives for Tax Abatement PolicyJuly 2003 - 3 - special projects to redevelop abandoned buildings consistent with existing law. For the purpose of this policy, an abandoned building is defined as a building that has been identified as being suitable for commercial or industrial development, has been vacant for a minimum of five years or has substantially declined in appraised value. Abatement would only be considered on the increased valuation of the improvements in each year covered by the tax abatement agreement over the value of the property for the year in which the tax abatement agreement is executed. The City of Denton may also consider other tax incentives authorized by law. Preliminary Annlicat/on IV. PROCEDURAL GUIDELINES Any person, organization or corporation desiring that the City consider providing tax abatement to encourage location or expansion of facilities within the limits of the jurisdictions shall be required to comply with the following procedural guidelines. Nothing within these guidelines shall imply or suggest that the City is under any obligation to provide tax abatement to any applicant. A. Applicant shall complete the attached "Application for Tax Abatement." Applicant shall prepare a map or other documents providing the following: · precise location of the property and all roadways within 500 feet of the site · existing uses and conditions of real property · proposed improvements and uses · any proposed changes in zoning compatibility with the Denton Comprehensive Plan and applicable building codes and City ordinances. Co A complete legal description shall be provided. Applicant shall complete all forms and information detailed in the Application and submit ali information to the City Manager, City of Denton, 215 E. McKinney, Denton, TX 76201. D. All information in the application package detailed above will be reviewed for completeness and accuracy. Additional information may be requested as needed. Eo The application will be distributed to the appropriate City deparUnents for internal review and comments. Additional information may be requested as needed. F. Copies of the complete application package and staff comments will be provided to the Joint Committee on Tax Abatement. G. Fiscal agents of the City and County will review the application for comments and recommendation. Additional information may be requested as needed. Tax Abatement PolicyJuly 2003 - 4 - Ko Con~qideration of the Annlication The Joint Committee on Tax Abatement will consider the application at a regular or called meeting(s). Additional information may be requested as needed. The recommendation of the Joint Committee on Tax Abatement will be forwarded, with all relevant materials, to the chief administrative officer of each taxing entity. If the City Council of Denton decides to grant a tax abatement, it shall call a public hearing to consider establishment of a tax reinveslment zone in accordance with Section 312.201 of the Tax Code. The reinvestment zone must meet one or more of the criteria of Section 312.202 of the Tax Code. The City Council of Denton shall hold a public hearing and determine whether the project is "feasible and practical and would be of benefit to the land to be included within the zone and City after the expiration of the tax abatement agreement in accordance with Section 312.201." Special consideration shall be given to policies noted in the Denton Comprehensive Plan when designating a tax reinvestment zone. The City Council of Denton may consider adoption of an ordinance designating the area described in the legal description of the proposed project as a commercial/industrial tax abatement zone. Mo The City Council may consider adoption of an ordinance or resolution approving the terms and conditions of a contract between the City and the applicant governing the provision of the tax abatement and the commitments of the applicant, including all the terms required by Section 312.205 of the Tax Code and such other terms and conditions as the City Council may require. Should the commitments subsequently not be satisfied, the tax abatement shall be null and void (unless the tax abatement agreement provides for a recapture of the property tax revenue lost proportionate to a partial failure to meet the minimum thresholds set forth in the agreement) and all abated taxes shall be paid mediately to the City of Denton and all other taxing jurisdictions participating in the tax abatement agreement. Provisions to this effect shall be incorporated into the agreement. N. The governing bodies of Denton County may consider ratification of and participation in the tax abatement agreement between the City of Denton and the applicant. 4 The City reserves the authority to enter into tax abatement agreements at differing percentages and/or terms as set forth in the guidelines of this policy, consistent with the requirements of the Tax Code. Any tax abatement agreement will address various issues, including but not limited to, the following: 1. General description of the project; 2. Amount of the tax abatement and percent of value to be abated each year; Tax Abatement Policy July 2003 - 5 - o 4. 5. 6. 7. 8. 9. Method of calculating the value of the abatement; Duration of the abatement, including commencement date and termination date; Legal description of the property; Kind, number, location and timetable of plarmed improvements; Specific terms and conditions to be met by applicant; The proposed use of the facility and nature of construction; Contractual obligations in the event of default, violation of terms or conditions, delinquent taxes, recapture, administration and assignment. Annual Evaluation Upon completion of construction, the Joint Committee on Tax Abatement shall receive from the City Manager an annual evaluation of each abatement to insure compliance with the agreement and to report possible violations of the agreement to the taxing entities. After new tax base numbers are received in July of each year, the City Manager and his staffwill have ninety (90) days to review and prepare a breakdown of those figures. Transfer or Assignment A contract for tax abatement may be transferred or assigned by the original applicant to a new owner upon approval by the various taxing jurisdictions after such a recommendation is made by the Joint Committee on Tax Abatement. Local Businesses and Minority Business Enternri,~e.~ tn performing this Agreement, OWNERS agree to use diligent efforts to purchase all goods and services fi.om Denton businesses whenever such goods and services are comparable in availability, quality and price. As a matter of policy with respect to CITY projects and procurements, CITY also encourages the use, if applicable, of qualified contractors, subcontractors and suppliers where at least fifty-one percent (51%) of the Ownership of such contractor, subcontractor or supplier is vested in racial or ethnic minorities or women. In the selection of subcontractors, suppliers or other persons or organizations proposed for work on this Agreement, the OWNERS agree to consider this policy and to use their reasonable and best efforts to select and employ such companies and persons for work on this Agreement. Job Recruiting from Low-Moderate Income Cennus Tract.~ OWNER, lessee or assignee of OWNER agrees it will endeavor to make available, or endeavor to cause lessees or assignees to make available, full-time or part-time employment with on-the-job training for Denton citizens. In this effort, OWNER, lessee or assignee agrees to recruit from the low-moderate income Census tracts as further defined in the Concentration of Low/Mod Income by Block Groups shown below. Tax Abatement PolicyJuly 2003 Tax Abatement Policy July 2003 7 EXI-I1RIT A The City of Denton Tax Abatement Application About the Application... The Tax Abatement Application provides the City with specific information on the project. The information requested in the Application is designed to address the criteria developed within the City of Denton's Tax Abatement Policy. The information serves as the basis for fiscal analysis and overall project evaluation. This evaluation is provided to Council Members and serves as a source document during City Council deliberations. The Application And The Agreement... Specific information from the Application (like value of new investment and employment commitments) is incorporated into the Abatement Agreement. In fact, the Application is an attachment to the Agreement. Since the agreement is a binding contract, it is important that each question on the application be an~a~rf~rl in fi~ll and as realistically as possible. Simply put, the application is part of the process from start to finish so you'll want to make sure you're comfortable with the contents. When Is The Application F~nal? The answer to this question is very simple: When you tell us, "It's final." It is not uncommon for a property owner(s) to submit numerous Applications as drafts for informational and evaluative purposes only. As conversations continue, the property owner will submit a finalized version of the Application that includes all of the comminnents agreed to during the discussions. What About Confidentiality ? Section 312.003 of the Texas Tax Code makes confidential information provided to the City as a part of this application that describes the specific processes or business activities to be conducted or the equipment or other property to be located on the property. This information is not subject to public disclosure until the tax abatement agreement is executed. Section 522.131 of the Texas Government Code (Texas Public Information Act) makes confidential information which relates to economic development negotiations between the City and a business prospect that the City seeks to have locate, stay or expand in or near the territory of the City. The information must relate to a trade secret of the business prospect, commercial or financial information which the business prospect can demonstrate based on specific factual evidence that disclosure would cause substantial competitive harm to the person from whom the information was obtained or information about a financial or other incentive being offered to the business prospect by the City or by another person. Information about a financial or other incentive being offered to the business prospect is required to be disclosed when an agreement is made with a business prospect. The City is subject to disclosing most records and documents upon request under the Public Information Act. Accordingly, please dearly indicate and mark any information you consider proprietary. This would include anything ill your application which you consider a trade secret, commercial or f'mancial information which you can demonstrate by specific factual evidence that would cause substantial competitive harm ff disclosed, information which describes the specific processes or business activities to be conducted or the eqm'pment or other property for which the tax abatement is sought, any f'mancial or other incentive you may be seeking from the City or any other information you deem to be confidential under the law. Who is Authorized To Sign the Application? Because the Application itseff is non-binding, the person signing need not be the property owner or even an individual duly authorized to sign on behalf of the property owner. However, if an Agreement is reached, the Application will be an attachment to the Agreement and its contents will be binding through the authorized signature requffed on the Agreement. Tax Abatement PolicyJuly 2003 City of Denton Tax Abatement Application City of Denton City Manager's Office Denton, Texas 76201 (940) 349-8307 (940) 349-8596 FAX Tax Abatement PolicyJuly 2003 - 9 - APPLICATION FOR TAX ABATEMENT CITY OF DENTON, TEXAS 1. Property Owner Company or Project Name Mailing Address Telephone Fax No. Contact Name Title Mailing Address Telephone Fax No. 2. Provide a chronology of plant openings, closing and relocations over the past 15 years. 3. Provide a record of mergers and financial restructuring during the past 15 years. Will the occupants of the project be owner or lessee? If lessee, are occupancy commitments already existing? Is the project a relocation of existing facility or a new facility to expand operations? If relocation, give current location. Tax Abatement PolicyJuly 2003 - 1 0 - If an existing Denton business, will project result in abandonment of existing facility? If so, the value of the existing facility will be sublxacted from the value of the new facility to arrive at total project value. 7. Property Description. - Attach a copy of the legal description detailing property's metes and bounds. - Attach map of project inchding all roadways, land use and zomg within 500 feet of site. Current Value. Attach copy of latest property tax statement from the Denton County Central Appraisal District (include both real and personal property). 9. Increased Value/Estimated Total Cost of Project. Structures $ Site Development $ Personal Property $ Other Improvements $ 10. Indicate amount of tax abatement and number of years requested for each taxing entity. City of Denton % years Denton County % years List any other financial incentives this project will request/receive Estimated Freeport Exemption $ Estimated Electric Utility Industrial Development Rider $ Estimated Water/Wastewater Infraslxucture Assistance $ 11. Give a brief description of the activities to be performed at this location, including a description of products to be produced and/or services to be provided. Tax Abatement PolicyJuly 2003 - 1 1 ~ 12. Project Construction Phase A. Estimate percentage of project development and construction dollars to be spent with Denton based contractors or sub-contractors. Construction costs $ Percentage local contractors % B. Construction Employment Estimates: Start Date (Mo/Yr) Completion Date (Mo/Yr) No. of Construction Jobs Estimated Total Construction Payroll $ C. Describe any off-site infrastructure requirements: , Water Wastewater · Streets · Drainage · Other Tax Abatement PolicySuly 2003 - 12 - 13. Project Operation Phase. Provide employment infommtion for the number ofyeaxs tax abatement is requested. At Project Existing Start Date At Term of Employment Information Operation (mo/yr) Abatement (if applicable) __/ A. Total number of permanent, full-time jobs B. Employees transferred from outside Denton Ci Netp~rmanent full-time jobs (A. minus B.) E. Total annual payroll for all permanent, full-time jobs (A.) F. Types of jobs created. List the job rifles and number of positions in each category that will be employed at the facility. Provide average wage for each category. G. Estimate annual utility usage for project: Electric $ Water $ Wastewater $ Gas $ 14. Describe any other direct benefits to the City of Denton as a result of this project (e.g., sales tax revenue or project elements identified in Tax Abatement Policy, Section III). Tax Abatement Policy July 2003 15. Is property zoned appropriately? Yes No Current zoning. Zoning required for proposed project. Anticipated variances. 16. Is property platted? Yes No Will replatting be necessary Yes No 17. Discuss any env/ronmentat impacts created by the project. A. List any permits for which applicant must apply. Applicant will be required to provide City with copies of all applications for envkonmental permits upon completion of application(s), B. Provide record of compliance to all environmental regulations for the past five years, 18. Provide specific detail of any businesses/residents that will be displaced and assistance that will be available from the requesting company. 19. Provide description of any historically significant area included within the project's area as determined by the Historic preservation Officer. If any, give detail of how the historically significant area will be preserved. 20. Justification for Tax Abatement Request: Substantiate and more fully describe the justification for this request. Include the amount of the abatement requested and show how it will contribute to the financial viability of the project. Submit attachments if necessary. Tax Abatement PolicyJuly 2003 - 14 - 21. List additional abatement factors to be considered for this project as outlined on pages 3 and 4 of the tax abatement policy. 22. Financial Information: Attach a copy of the latest audited financial statement or, in the case of a new project, a business plan. This tax abatement application is submitted with the acknowledgement that additional certified financial information may be required. Authorized Signature Date: Tax Abatement PolicyJuly 2003 - 15 - AGENDA INFORMATION SHEET AGENDA DATE: August 19, 2003 DEPARTMENT: CM/DCM/ACM: Parks and Recreation Department Howard Martin, Assistam City Manager SUBJECT Consider approving an ordinance approving a license agreemem between the City of DeNon and the First United Methodist Church of Denton, Inc. to continue to allow use of a building at Evers Park for Boy Scout activities; and providing an effective date. BACKGROUND In 1967, Boy Scout Troop 65, sponsored by the First United Methodist Church of Denton, Inc. (FUMC) moved its "Boy Scout Hut" to Evers Park to allow for the construction of municipal buildings at Civic Cemer Park. Since that time, the building has been maimained by FUMC for Boy Scout activities. The City of Denton recognizes the legitimate use of the building and the significance of the program it provides to the community and desires to continue this arrangement under a legal agreement. The License Agreement states that FUMC may only use property for Boy Scout activities, acquire the written permission of the Parks and Recreation Department before any modifications to the building or surrounding grounds be made, and maimain the building and affected grounds in a clean and orderly manner and in compliance with City codes, ordinances and park rules. It also requires that the City of DeNon will not make modifications that will prevent the Boy Scouts from using the facility for its stated purpose and will make all decisions related to property modifications based on the best imerest of the community and the long-term needs of Evers Park. OPTIONS Council options include the approval or denial of the ordinance and agreemem as submitted. Council may also opt to modify the agreemem to include additional or modified requiremems. RECOMMENDATION Staff recommends approval of this ordinance and agreemem. ESTIMATED PROJECT SCHEDULE This agreement will become effective upon approval by the City Council. PRIOR ACTION/REVIEW No prior action was required related to this item. FISCAL INFORMATION There is no impact to the City of Denton budget related to this item. All operation and maintenance costs for this building are the responsibility of First United Methodist Church of Denton, Inc. ATTACHMENTS Exhibit 1 - Ordinance Exhibit 2 - License Agreement Respectfully submitted: Janet Simpson, Interim Director Parks and Recreation Department ORDINANCE NO. AN ORDINANCE APPROVING A LICENSE AGREEMENT BETWEEN THE CITY OF DENTON AND THE FIRST UNITED METHODIST CHURCH OF DENTON, INC. TO CONTINUE TO ALLOW USE OF A BUILDING AT EVERS PARK FOR BOY SCOUT ACTIVITIES; AND PROVIDING AN EFFECTIVE DATE. THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The City Manager, or his designee, is hereby authorized to execute a License Agreement between the City of Denton' and the First United Methodist Church of Denton, Inc. in substantially the form of the License Agreement attached hereto and made part of the ordinance for all purposes (the "License Agreement"). SECTION 2. The City Council hereby finds that the License Agreement is in the public interest. SECTION 3. This ordinance shall become effective immediately upon its passage and approval. PASSED AND APPROVED this the day of ,2003. ATTEST: JENN1FERWALTERS, CITY SECRETARY EULINE BROCK, MAYOR BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: ~ EXHIBIT 1 LICENSE AGREEMENT This Agreement is made this day of ,2003, by and between the CITY OF DENTON, TEY'_&S, a home rule municipal corporation ("Licensor"), and FIRST UNITED METHODIST CHURCH OF DENTON, INC., a Texas non-profit corporation ("Licensee"). RECITALS a. Licensor is the owner of a public park called Evers Park. On Evers Park is a building that has been occupied by Licensee for several years. Such building is located as shown on the drawing attached hereto and made a part hereof as Exhibit "A" (the "Property"), b. Licensee desires to continue to exercise certain rights and privileges upon the Property. NOW, THEREFORE, k is agreed as follows. Licensee Shall have the right to use the Property for boy scout activities in the same manner as it has done so in the past. The parties acknowledge and agree that such activities are park or recreational activities and constitute a park purpose. No other uses of the Property or modifications to the .building or surrounding grounds are permitted without the prior written consent of Licensor. Licensee shall maintain the Property including the building and surrounding grounds in a clean and orderly manner and in compliance with City of Denton codes, ordinances and park rules. While this license is, in effect Licensor will not make modifications to the Property that will prevent Licensee from using the Property for the purposes stated in Section I above and any such modifications by Licensor will be based on the best interests of the citizens of Denton and the tong-term needs of Evers Park. 3. This license is personal to the Licenseel It is not assignable, and any attempt to assign this license will terminate the license. 4. This agreement is terminable by either party at will by the giving of actual notice to the other party. 5. · Licensee shall hold harmless, release, defend, and indemnify Licensor against any suits, liabilities, claims, demands, or damages, including but not limited to personal injuries and attorneys' fees, arising from Licensee's exercise of the license under this Agreement. Signed effective as of the date first above written. EXHIBIT 2 CITY OF DENTON, TEXAS ATTEST: BY: Michael A. Conduff City Manager Jennifer K walters City Secretary APPROVED AS TO FORM: BY: FIRST UNITED METHODIST CI-tLrRCH OF DENTON, Name: ~ ,-~eT- Title: C/~c~ r-,~- ~ Page 2 ACKNOWLEDGMENTS STATE OF TEXAS ) COUNTY OF DENTON ) This instrument was acknowledged before me on the m day of A. Conduff, City Manager of the City of Denton, Texas, on behalf of said city. 2003 by Michael Notary Public, in and for the State of Texas My Commission expires: STATE OF TEXAS ) COUNTY ) This instrument was acknowledged before me on the ~h day of ~ur-[' , 2003 by kinda ~ohn~n , the ¥oul'[ICDi[~een ~'~,.~!V of-~rst United Methodist Church of E{ento_n, Inc. on behalf'of ;aid Co~orafion. t ' ' Il ~.~*' May 22, 2006 il N~ ~Ubli~ ih~hd f~ the :State o Tea ~'~ '2'"'._ _ .=- ._.. '"'....- ~' [~ .'~ My Commission eXpires: ~ ~; ~ O¢ Page 3 5X~IBIT "A" --Coiled ~0; R~e~ V'~.$~g Pg.560 NORTH I ~ II II I II I I III AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: CM: August 19, 2003 Economic Development Department Michael A. Conduff, City Manager ~ SUBJECT Consider approval of a resolution of the City of Demon, Texas calling a public hearing to consider establishing a reinvestment Zone VI for Flowers Foods Bakeries Group, LLC.; and declaring an effective date. BACKGROUND Flowers Foods Bakeries Group, LLC. submitted a request for tax abatement on June 20, 2003. The Joint Tax Abatement Committee recommended the request be forwarded to the City Council and Demon County for consideration. Tax abatements can only be given to projects located within reinvestment zones. This resolution calls a public hearing to consider the establishment of Reinvestment Zone VI around the subject property. The public hearing notice will be published in the Demon Record-Chronicle August 22, 2003 edition for a September 2 public hearing. ESTIMATED SCHEDULE OF PROJECT If the establishment of Reinvestment Zone VI is approved, the proposed tax abatement agreement will also be considered at the September 2nd City Council meeting. PRIOR ACTION/REVIEW The Joint Tax Abatement Committee recommends approval. FISCAL INFORMATION None. EXHIBITS Resolution Exhibit A - Property Description Exhibit B - Site Map Respectfully submitted: Linda Ratliff, Director Economic Development Department RESOLUTION NO. A RESOLUTION OF THE CITY OF DENTON, TEXAS CALLING A PUBLIC HEARING TO CONSIDER ESTABLISHING A REINVESTMENT ZONE VI FOR FLOWERS FOODS BAKERIES GROUP, LLC; AND DECLARING AN EFFECTIVE DATE. WHEREAS, the City has adopted by resolution a Tax Abatement Policy and criteria governing tax abatement agreements in accordance with Tex. Tax Code ch. 312; and, WHEREAS, the City has received a tax abatement request from Flowers Foods Bakeries Group, LLC; and WHEREAS, the City finds that it is in the public interest to cai1 a public hearing to consider the creation of a reinvestment zone for tax abatement purposes for the purpose of offering a tax abatement to Flowers Foods Bakeries Group, LLC, in accordance with Tex. Tax Code §312.201; NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON HEREBY RESOLVES: SECTION 1. The findings and recitations contained in the preamble of this ordinance are incorporated herein by reference. SECTION 2. The City Council hereby calls a public heating and the City Manager is hereby authorized to give notice of a public heating for the establishment of a reinvestment zone (Reinvestment Zone VI), comprised of the property located on approximately 91.921 acres at or near 4210 Edwards Road, within the corporate limits or extraterritorial jurisdiction of the City of Denton as more fully described in Exhibit "A" and as shown on the diagram as the area outlined in red in Exhibit "B," which exhibits are attached hereto and made a part hereof by reference (the "Property") for the purpose of entering into a tax abatement agreement with Flowers Foods Bakeries Group, LLC for a project to be developed within the Property and this Reinvestment Zone and other eligible projects under the City's Tax Abatement Policy. At the hearing, the City Council will determine whether the improvements sought are feasible and practical and would be a benefit to the land to be included in the Reinvestment Zone and to the City after expiration of any tax abatement agreement entered into under Tex. Tax Code ch. 312. Notice of the public hearing will be substantially in the form of the notice contained in Exhibit "A". The public heating will take place on the 2'~d day of September, 2003, at 6:30 p.m. in the City Council Chambers at City Hall at 215 E. McKirmey, Denton, Texas 76201, but not until at least seven days after notice of this public heating has been published in the Denton Record-Chronicle, a newspaper having general circulation within the City, and specific notices are delivered in writing to the presiding officer of the Board of Trustees of the Denton Independent School District, the Commissioners Court of Denton County, and to other taxing units, if any, that include in their boundaries the real property described in the attached Exhibit "A" in accordance with Tex. Tax Code §312.201. SECTION 3. This resolution shall become effective immediately upon its passage and approval at a regular meeting of the City Council of the City of Denton, Texas on this the 19th day of August, 2003, at which meeting a quorum was present and the meeting was held in accordance with the provisions of Tex. Gov't Code § 551.001, et. seq. PASSED AND APPROVED this the day of ,2003. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: HERBERT L. PROUTY, CITY ATTORNEY BY: Page 2 of 2 EXHIBIT "A" NOTICE OF PUBLIC HEARING PUBLIC NOTICE IS HEREBY GIVEN THAT ~ CITY COUNCIL OF THE CITY OF DENTON, TEXAS, WILL HOLD A PUBLIC HEARING TO ALLOW INTERESTED PERSONS TO SPEAK AND PRESENT EVIDENCE FOR OR AGAINST THE ESTABLISHMENT OF A REINVESTMENT ZONE VI FOR COMMERCIAL/ INDUSTRIAL TAX ABATEMENT PURPOSES. THE PURPOSE OF TI:ii~ ZONE IS TO ATTRACT THF~ FLOWERS FOODS BAKERIES GROUP, LLC AND SIMH,AR INDUSTRIAL AND COMMERCIAL BUSINESS ENTERPRISES TO TlqF, CITY OF DENTON, CREATE JOBS, EXPAND THF, LOCAL TAX BASE, AND TO ATTRACT MAJOR INVESTMENT IN TYIF~ ZONE THAT WOULD BE A BENEFIT TO THE PROPERTY AND THAT WOULD CONSTRIBUTE TO THE ECONOMIC DEVELOPMENT OF THE CITY. TI:IF, PURPOSE OF TI~ I:I-EARING WILL BE TO DETERMINE WHF~THF, R ~ IMPROVEMENTS SOUGHT ARE FEASIBLE AND PRACTICAL AND WOULD BE A BENEFIT TO THE LAND INCLUDED IN TI~F, ZONE AND TO TH-E CITY AFTER EXPIRATION OF ANY TAX ABATEMENT AGREEMENT ENTERED INTO UNDER CHAPTER 312 OF ~ TAX CODE. ALL INTERESTED PARTIES INCLUDING RESIDENTS OF TFrF, PROPOSED ZONE ARE ENCOURAGED TO PRESENT THEIR VIEWS AT THE lqF~ARING. TI:IFA PUBLIC HEARING WILL BE HELD ON SEPTEMBER 2, 2003, AT 6:30 P.M. IN THE CITY COUNCIL CHAMBERS AT CiTY HALL, 215 E. McKINNEY. REINVESTMENT ZONE VI WILL BE COMPOSED OF APPROXIMATELY 91.921 ACRES OF LAND OUT OF G. WALKER SURVEY ABSTRACT NUMBER 1330, IN THE M.E.P. & P.R.IL CO. SURVEY ABSTRACT NUMBER 950, AND IN THE D. LAMBERT SURVEY ABSTRACT NUMBER 784, DENTON COUNTY, TEXAS, TI~F~ REINVESTMENT ZONE AREA IS MORE PARTICULARLY DESCRIBED AS FOLLOWS: ALL THAT CERTAIN TRACT OR PARCEL OF LAND LYING AND BEING SITUATED IN THE G. WALKER SURVEY ABSTRACT NUMBER 1330, IN THE M.E.P. & P.R.R. CO. SURVEY ABSTRACT NUMBER 950, AND IN THE D. LAMBERT SURVEY ABSTRACT NUMBER 784, DENTON COUNTY, TEXAS, AND BEING PART OF THE CALLED 27.4367 ACRE TRACT DESCRIBED IN THE DEED TO ANDREW CORPORATION, RECORDED IN VOLUME 912, PAGE 790, DEED RECORDS OF DENTON COUNTY, TEXAS, PART OF THE CALLED 8.773 ACRE TRACT DESCRIBED IN THE DEED TO ANDREW CORPORATION, RECORDED IN VOLUME 912, PAGE 797 OF THE DEED RECORDS OF DENTON COUNTY, TEXAS, PART OF THE CALLED 3.000 ACRE TRACT DESCRIBED IN THE DEED TO ANDREW CORPORATION, RECORDED IN VOLUME 912, PAGE 804 OF THE DEED RECORDS OF DENTON COUNTY, TEXAS, PART OF THE CALLED 79.4992 ACRE TRACT, DESCRIBED IN A DEED TO ANDREW CORPORATION, RECORDED IN VOLUME 912, PAGE 821, DEED RECORDS, DENTON COUNTY, TEXAS, ALL OF THE 3.59 ACRES OF LAND DESCRIBED IN THE DEED TO ANDREW CORPORATION, RECORDED UNDER CLERKS FILE NUMBER 96-R0014833 OF THE REAL PROPERTY RECORDS OF DENTON COUNTY, TEXAS, AND PART OF ANDREW ADDITION PHASE ONE AS SHOWN BY THE PLAT THEREOF RECORDED IN CABINET B, PAGE 12 OF THE PLAT RECORDS OF DENTON COUNTY, TEXAS AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT A FOUND RAILROAD SPIKE AT THE NORTHEAST CORNER OF THE 27.4367 ACRE ANDREW TRACT IN EDWARDS ROAD; THENCE SOUTH 02 DEGREES 40 MINUTES 55 SECONDS WEST WITH THE EAST LINE OF THE 27.4367 ACRE ANDREW TRACT A DISTANCE OF 698.28 FEET TO A FOUND IRON PIN AT AN ANGLE POINT IN THE EAST LINE OF THE 27.4367 ACRE ANDREW TRACT; THENCE SOUTH 02 DEGREES 43 MINUTES 42 SECONDS WEST CONTINUING WITH THE EAST LINE OF THE 27.4367 ACRE ANDREW TRACT A DISTANCE OF 1249.03 FEET TO A FOUND IRON PIN AT THE SOUTHEAST CORNER OF THE 27.4367 ACRE ANDREW TRACT ON THE NORTH LINE OF THE 22.967 ACRE TRACT TO JULIE K. CLARK RECORDED UNDER CLERKS FILE NUMBER 95-R0000602 OF THE REAL PROPERTY RECORDS OF DENTON COUNTY, TEXAS; THENCE NORTH 87 DEGREES 33 MINUTES 17 SECONDS WEST WITH THE SOUTH LINE OF THE 27.4367 ACRE ANDREW TRACT A DISTANCE OF 622.20 FEET TO A FOUND IRON PIN AT THE SOUTHWEST CORNER OF THE 27.4367 ACRE ANDREW TRACT, THE NORTHWEST CORNER OF THE 22.967 ACRE CLARK TRACT, THE NORTHEAST CORNER OF THE 3.59 ACRE ANDREW TRACT, AND THE EASTERN MOST SOUTHEAST CORNER OF ANDREW ADDITION; THENCE SOUTH 03 DEGREES 19 MINUTES 02 SECONDS WEST WITH THE EAST LINE OF THE 3.59 ACRE ANDREW TRACT AND THE WEST LINE OF THE 22.967 ACRE CLARK TRACT A DISTANCE OF 472.97 FEET TO A FENCE CORNER POST AT AN ANGLE POINT IN THE EAST LiNE OF THE 3.59 ACRE ANDREW TRACT AND THE NORTHWEST CORNER OF THE CALLED 0.942 ACRE TRACT DESCRIBED iN THE DEED TO JULIE K. CLARK RECORDED UNDER CLERKS FILE NUMBER 99-R0000310 OF THE REAL PROPERTY RECORDS OF DENTON COUNTY, TEXAS; THENCE SOUTH 03 DEGREES 01 MINUTES 21 SECONDS WEST CONTINUING WITH THE EAST LINE OF THE 3,59 ACRE ANDREW TRACT AND THE WEST LiNE OF THE 0.942 ACRE CLARK TRACT A DISTANCE OF 224,75 FEET TO A STEEL PIPE AT THE SOUTHEAST CORNER OF THE 3.59 ACRE ANDREW TRACT ON THE NORTH RIGHT-OF-WAY LINE OF POCKRUS PAGE ROAD; THENCE NORTH 87 DEGREES 56 MINUTES 40 SECONDS WEST WITH THE SOUTH LINE OF THE 3.59 ACRE ANDREW TRACT A DISTANCE OF 218.61 FEET TO A FENCE CORNER POST AT THE SOUTHWEST CORNER OF THE 3.59 ACRE ANDREW TRACT AND THE SOUTHEAST CORNER OF THE TRACT OF LAND DESCRIBED IN THE DEED TO BETTY JOHN ROBERTSON RECORDED IN VOLUME 2423, PAGE 932 OF THE REAL PROPERTY RECORDS OF DENTON COUNTY, TEXAS; THENCE NORTH 01 DEGREES 47 MINUTES 13 SECONDS EAST WITH THE WEST LINE OF THE 3.59 ANDREW TRACT AND THE EAST LINE OF THE ROBERTSON TRACT A DISTANCE Of 683.38 FEET TO AN IRON PIPE AT THE NORTHWEST CORNER OF THE 3.59 ACRE ANDREW TRACT AND THE NORTHEAST CORNER OF THE CALLED 3.980 ACRE TRACT TO KENNETH D. OWEN RECORDED IN VOLUME 763, PAGE 137 OF THE DEED RECORDS OF DENTON COUNTY, TEXAS ON A SOUTH LINE OF ANDREW ADDITION; THENCE NORTH 87 DEGREES 39 MINUTES 54 SECONDS WEST WITH A SOUTH LINE OF ANDREW ADDITION AND THE NORTH LINE OF THE OWEN TRACT A DISTANCE OF 363.71 FEET TO A FOUND IRON PIN AT AN INNER ELL CORNER OF ANDREW ADDITION; THENCE SOUTH 03 DEGREES 03 MINUTES 00 SECONDS WEST WITH AN EAST LINE OF ANDREW ADDITION AND THE WEST LINE OF THE OWEN TRACT A DISTANCE OF 397.16 FEET TO A FOUND IRON PIN; THENCE SOUTH 39 DEGREES 11 MINUTES 57 SECONDS EAST WITH AN EAST LINE OF ANDREW ADDITION AND THE SOUTH LINE OF THE OWEN TRACT A DISTANCE OF 382.68 FEET TO A FOUND IRON PIN AT THE SOUTHERN MOST SOUTHEAST CORNER OF ANDREW ADDITION AND THE SOUTHERN MOST SOUTHWEST CORNER OF THE OWEN TRACT ON THE NORTH RIGHT-OF-WAY LINE OF POCKRUS PAGE ROAD; THENCE NORTH 87 DEGREES 46 MINUTES 12 SECONDS WEST WITH A SOUTH LINE OF ANDREW ADDITION AND THE NORTH RIGHT-OF-WAY LINE OF POCKRUS PAGE ROAD A DISTANCE OF 26.57 FEET TO A FOUND IRON PIN AT THE SOUTHERN MOST SOUTHWEST CORNER OF ANDREW ADDITION ON THE EAST RIGHT-OF-WAY LINE OF THE OLD M.K.T. RAILROAD; THENCE NORTH 39 DEGREES 14 MINUTES 16 SECONDS WEST WITH A WEST LINE OF ANDREW ADDITION A DISTANCE OF 412.02 FEET TO A FOUND IRON PIN AT THE BEGINNING OF A CURVE TO THE RIGHT; THENCE WITH THE EAST RiGHT-OF-WAY LINE OF THE OLD M.K.T. RAILROAD ALONG SAID CURVE HAVING A DELTA OF 26 DEGREES 11 MINUTES 57 SECONDS, A RADIUS OF 2814.79 FEET, AN ARC LENGTH OF 1287.10 FEET (CHORD OF NORTH 26 DEGREES 10 MINUTES 09 SECONDS WEST A DISTANCE OF 1275.92 FEET) TO A FOUND IRON PIN; THENCE NORTH 13 DEGREES 00 MINUTES 38 SECONDS WEST CONTINUING WITH THE EAST RIGHT-OF-WAY LINE OF THE OLD M.K.T. RAILROAD AND THE WEST LINE OF ANDREW ADDITION A DISTANCE OF 1221.59 FEET TO A FOUND iRON PIN AT THE BEGINNING OF A CURVE TO THE LEFT; THENCE CONTINUING WITH THE EAST RIGHT-OF-WAY LINE OF THE OLD M.K.T. RAILROAD ALONG SAID CURVE HAVING A DELTA OF 09 DEGREES 53 MINUTES 43 SECONDS, A RADIUS OF 1959.24 FEET, AN ARC LENGTH OF 338.37 FEET (CHORD OF NORTH 17 DEGREES 58 MINUTES 31 SECONDS WEST A DISTANCE OF 337.99 FEET) TO A SET IRON PIN WITH A YELLOW PLASTIC CAP STAMPED "METROPLEX 1849" ON THE SOUTH RIGHT-OF-WAY LINE OF MAYHILL ROAD AS DESCRIBED IN THE STREET RIGHT-OF-WAY DEED TO THE CITY OF DENTON RECORDED IN VOLUME 4936, PAGE 1841 OF THE RI:AL PROPERTY RECORDS OF DENTON COUNTY, TEXAS AT THE BEGINNING OF A CURVE TO THE LEFT; THENCE WITH THE SOUTH RIGHT-OF-WAY LINE OF MAYHILL ROAD ALONG SAID CURVE HAVING A DELTA OF 01 DEGREES 17 MINUTES 13 SECONDS, A RADIUS OF 540.00 FEET, AN ARC LENGTH OF 12.13 FEET (CHORD OF NORTH 66 DEGREES 07 MINUTES 51 SECONDS EAST A DISTANCE OF 12.13 FEET)TO A SET "X" IN CONCRETE AT THE INTERSECTION OF THE SOUTH RIGHT-OF-WAY LINE OF MAYHILL ROAD AND THE WEST RIGHT-OF-WAY LINE OF EDWARDS ROAD AS DESCRIBED IN THE STREET RIGHT-OF-WAY DEED TO THE CITY OF DENTON RECORDED IN VOLUME 4936, PAGE 1841 OF THE REAL PROPERTY RECORDS OF DENTON COUNTY, TEXAS; THENCE SOUTH 27 DEGREES 41 MINUTES 50 SECONDS EAST WITH THE WEST RIGHT-OF-WAY LINE OF EDWARDS ROAD A DISTANCE OF 147.27 FEET TO A SET IRON PIN WITH A YELLOW PLASTIC CAP STAMPED "METROPLEX 1849" AT THE BEGINNING OF A CURVE TO THE LEFT; THENCE CONTINUING WITH THE WEST RIGHT-OF-WAY LINE OF EDWARDS ROAD ALONG SAID CURVE HAVING A DELTA OF 59 DEGREES 01 MINUTES 36 SECONDS, A RADIUS OF 330.00 FEET, AN ARC LENGTH OF 339.97 FEET (CHORD OF SOUTH 57 DEGREES 12 MINUTES 38 SECONDS EAST A DISTANCE OF 325.13 FEET) TO A SET IRON PIN WITH A YELLOW PLASTIC CAP STAMPED "METROPLEX 1849"; THENCE SOUTH 86 DEGREES 44 MINUTES 08 SECONDS EAST WITH THE SOUTH RIGHT-OF-WAY LINE OF EDWARDS ROAD A DISTANCE OF 1797.84 FEET TO A FOUND IRON PIN; THENCE NORTH 03 DEGREES 30 MINUTES 26 SECONDS EAST A DISTANCE OF 35.49 FEET TO A FOUND RAILROAD SPIKE IN EDWARDS ROAD ON THE NORTH LINE OF THE 27.4367 ACRE ANDREW TRACT; THENCE SOUTH 88 DEGREES 03 MINUTES 58 SECONDS EAST WITH THE NORTH LINE OF THE 27.4367 ACRE ANDREW TRACT A DISTANCE OF 172.15 FEET TO THE POINT OF BEGINNING AND CONTAINING IN ALL 91.921 ACRES OF LAND. EXHIBIT "B" t~ AGENDA DATE: DEPARTMENT: CM/DCM/ACM: AGENDA INFORMATION SHEET August 19, 2003 Engineering Jon Fortune, Assistant City Manager SUBJECT Consider approval of three exaction variances for a parcel containing approximately 12 acres and is located on the north side of Jim Christal Road west of the GC & SF Railroad. The property is currently in an Industrial Center-Employment (lC-E) zoning district. The property is currently developed and no new construction is proposed. The Planning and Zoning Commission recommends approval of the variances as proposed by the applicant and conditioned by City staff. Planning and Zoning recommends approval (7-0). (V03-0018) 1) Section 35.20.2(L.3.a.) of the Code of Ordinance concerning improvements to a perimeter street; 2) Section 35.20.3(B.) of the Code of Ordinance concerning perimeter sidewalks; and 3) Section 35.20.2(H. 1.) of the Code of Ordinance concerning the dedication of right of way for all streets that serve a commercial lot (regarding ROW for a cul-de-sac at the end of Jim Christal Road at its intersection with the GC & SF Railroad). BACKGROUND Mr. William Shipp, PE, the applicant for this property (representing NRX Acquisition Corporation, the developer of the Harley Addition) has applied for exaction variances of Section: 1) 35.20.2(L.3.a.) concerning improvements to a perimeter street, 2) 35.20.3(B.) concerning installation of perimeter sidewalk and 3) 35.20.2(H. 1) concerning right-of-way dedication sufficient for a cul-de-sac. The Code requires 1) 35.20.2(L.3.a) that for existing perimeter streets, any development on the perimeter of an unimproved perimeter street shall dedicate the right-of-way and improve or reconstruct the street to the same extent as is required for new perimeter streets", and, "in no case shall that portion of the street provided be less than a pavement width of twenty-five (25) feet plus required bicycle lane in the case of an arterial. 2) 35.20.3(B) that all developments, within a dedicated right-of-way or easement, provide sidewalks and/or bicycle facilities designed and located in accordance with the Transportation Design Criteria Manual and street classification along one (1) side of all perimeter streets. 3) 35.20.2(H.1) that public right of way shall be dedicated for all streets that serve any commercial or industrial lot. This would be in regards to additional ROW dedication required for a cul-de-sac at the end of Jim Christal Road. The cause of this request is the result of this property being subdivided. The buildings and related structures on the property exist. There will be no improvements or additions to the existing buildings or new structures built. As there is no substantive costs associated with improvements to this property for the requested subdivision, the costs to install the perimeter pavement and sidewalk is an imposition on the development which exceeds any reasonable benefit to the property owner. The applicant Page 1 imends to dedicate an additional 6.5fl of ROW for Jim Christal Road (as required for a 73ft commercial mixed use collector) along the emire fromage of this property. However, the applicam is requesting to not have to dedicate additional ROW for a cul de sac at the end of Jim Christal Road, because existing on site facilities would be within the proposed cul de sac's ROW and have to be removed by the applicam (which would be an additional cost that exceeds any reasonable benefit to the property owner). In this area, Jim Christal Road is a two (2)-lane rural type roadway that ends at the GC & SF Railroad, and the City does not imend to provide for Jim Christal Road to cross the railroad, in that the City relinquished this crossing in order to have the crossing for W Oak Street. A detailed letter from the applicam is attached and outlines various items/issues. The City Council may approve an exaction variance if the following criterion is met: b) Criteria for variances from developmem exactions. Where the commission finds that the imposition of any development exaction pursuant to these regulations exceeds any reasonable benefit to the property owner or is so excessive as to constitute confiscation of the tract to be platted, it may recommend approval of variances to waive such exaction's, so as to prevent such excess, to the City Council. Waiver of developmemal exactions shall be approved by the City Council. The price the applicam paid for the parcel, or the cost of the proposed building improvemems is not a factor in determining reasonable costs. The City Council must decide if the costs associated with the public improvemems required by city regulations are reasonable and consistem for the type of developmem proposed and are proportional to the demand for services created by the developmem. OPTIONS 1. Approve Full variance 2. Approve Full variance with conditions 3. Approve a partial variance 4. Deny variance RECOMMENDATION Staff recommends approval of the exaction variances, per the applicam's request, with the condition that the variance is not valid until such time as the applicant enters into a restrictive covenant with the City of DeNon which will be recorded of record and binding on the owner and future owners of the subject property. The restrictive covenam will provide that the variance will expire at such time an additional building or buildings are constructed or the existing buildings are expanded in size on the subject property. At such time the property owner will have to comply with the subject exaction requirements unless a new variance is granted. Reference to the restrictive covenants will be made on the final plat. The Planning & Zoning Commission voted 7-0 to recommend approval of the variances, with the condition, on July 23, 2003. PRIOR ACTION/REVIEW The Planning & Zoning Commission voted 7-0 to recommend approval of the variances on July 23, 2003. Page 2 FISCAL INFORMATION 1) Current construction costs 2) 3) for 25 ft of pavement width with curb/gutter is estimated at $75/linear ft. The frontage is approximately 650ft, resulting in an estimated cost of $48,750.00 for the pavement improvements. Current construction costs for 8ft wide sidewalk is estimated at $20/ft. The frontage is approximately 650ft, resulting in an estimated cost of $13,000.00 for the sidewalk's installation. Cost for the additional ROW is estimated at $1.00/sqft. The amount of additional ROW required for the cul de sac is approximately 1500sqft, resulting in an estimated cost of $1,500.00 for the ROW dedication ATTACHMENTS 1. Location map 2. Plat 3. Applicant's letter 4. Enlargement of proposed cul de sac's area 5. P & Z minutes Prepared By: David Salmon, Assistant Director Engineering Respectfully submitted: Charles Fiedler Director, Engineering Page 3 J M ~RI~TJk L I ATTACHMENT #1 SITE LOCATION ,_._--, ATTACHMENT #3 APPLICANT'S LETTER I HUITT-ZOLLARS, INC. , 2220 San Jacinlo Blvd. , Svile 330 ~ Denlon, TX 76205-7540 ' 214.871.3311 phone ' 940.483.1127 fax * huill-zolJ(~rs.corn July 8, 2003 Wes Morrison Planning Department City Hall West 221 N. Elm Street Denton, TX 76201 VARIANCE REQUEST REPLAT OF THlg HARLEY ADDITION HZI PROwl NO. 01-3369-01 Mr. Morrison: On behalf of the NRX Acquisition Corporation, we are herewith requesting a variance to the City of Denton subdivision ordinance for the purposes of the proposed Replat of the above-mentioned property. Please find attached the following: · Completed Application · Check for Application Fee in the amount of $250.00 · 1 - Copy of the proposed Replat with location map The purpose of the proposed replat is to subdivide the existing lot into two lots for the purpose of conveyance. There are currently two buildings on the property, and the proposed subdivision would allow each building to be on a separate lot. No additional development is currently proposed for this property. According to the subdivision ordinance, final platting would require that the property owner would be responsible for improvements to Jim Christal Road along the frontage of the platted property. These improvements would include the upgrade of one half of the existing street to meet the current city standards for a commercial mixed use collector and the construction of an 8' wide concrete sidewalk along the length of frontage. We are requesting an exaction variance to these requirements on the basis that the owner is not proposing any cost improvements to this property with this plat. Additionally, the subdivision ordinance requires that the owner of this property dedicate additional right of way along the frontage to upgrade the existing right of way to the current standards for a commercial mixed use collector and to dedicate additional right of way for one half of a cul de sac at the end of the street because of the dead end. The owner is proposing to dedicate the additional width of right of way along the length of frontage, however, because of existing improvements on the subject property, we are requesting a variance to the cul de sac requirement. Dedication' of the eul de sac right of way would require the relocation of existing physical improvements at a significant expense to the owner. As previously stated, this property is currently developed and occupied and the owner has no current plans for cost improvements to the property. The purpose of the replat is to enable the owner to legally sell a portion of the property. The owner therefore requests the aforementioned variances on the basis that they would impose undue financial burdens upon the owner and the costs would exceed any reasonable benefit to the property owner. Should you have any questions or require any additional information please do not hesitate to call me at 214-871-3319, ext. 1500. Sincerely, Huitt-Zollars, Inc. Associate attachments Agenda No: Date 01~.1_~-0.~ Item: MINUTES PLANNING AND ZONING COMMISSION July 23, 2003 After determining that a quorum was present, the Planning and Zoning Commission convened into a Work Session on Wednesday, July 23, 2003 at 6:00 pm in the Council Work Session Room at City Hall, 215 E. McKinncy Street, Denton, Texas at which time the following items were considered: Commissioners Present: Susan Apple, Joe Roy, Joe Mulroy, George Watkins, Vicki Holt, John Johnson and Bob Powelt. Staff Present: Ed Snyder, Assistant City Attorney: Kelly Carpenter, Director of Planning and Development Services; Wes Morris, Planner I; Bud Vokoun, Engineer: David Salmon, Assistant Engineer Director; Charles Fiedler, Director of Engineer. 1. Receive a briefing and hold a discussion of items listed on the Consent Agenda. The Planning and Zoning Commission convened into a Regular meeting of the Planning and Zoning Commission of the City of Denton, Texas which was held on Wednesday, July 23, 2003 and began at 6:30 p.m. in the City Council Chambers at City Hall, 2t5 E. McKinney at which time the following items were considered: 1. Pledge of Allegiance A. U.S. Flag B. Texas Flag "Honor the Texas Flag - I pledge allegiance to thee, Texas, one and indivisible." 2. Consider approval of the minutes for July 9, 2003. Motion by Joe Roy and seconded by Joe Mulroy to approve the minutes. *Discussion of item is included in the Court Reporter's transcript attached to this set of minutes (Page 1) Motion carfie~q 7-0 The following items are recommended by Staff and approval thereof wilt be strictly on the basis of Staff recommendation. Approval of the Consent Agenda authorizes the Staff to proceed with each item in accordance with the City of Denton Code of Ordinances. The Planning and Zoning Commission has received background information and has had an opportunity to raise questions regarding these items prior to consideration. A. Consider approval of the Final Plat of Teasley Lane High School Addition. The 77.7 acre property is located east of Teasley Lane and north of FM 2181. The property is within Neighborhood Residential 2 (NR-2) zoning district and the extra territorial jurisdiction (ETJ). A high school campus is proposed. (FP03-0006, Teasley Lane High School, Wes Mordson) B. Consider approval of an Final Plat of of the Thistle Hill Estates Phase II. The 31.5 acre property is located south of Ryan Road and north of the future Creekdale Road. The property is in the Neighborhood Residential 4 (NR-4) zoning district. A 121 single-family lots are proposed. (FP03-0005, Thistle Hill Estates Phase II, Wes Mordson) C. Consider approval of the Final Plat of Denton Station Phase I lot 1 block AThe approximately 5.9 acre site is generally located east of Centre Place and South of Alegre Vista. This property is in a Downtown Commercial General (DC-G) zoning strict. 2 mixed-use lots are proposed. (FP03-0031, Denton Station, Wes Morrison) D. Consider approval of the Final Plat of The Vintage Subdivision, Phase 2-B. The 22.8 acre site is located along the west side of Bonnie Brae north of the Vintage Boulevard. The property is in Planned Development 139 (PD-139) zoning district. Ninety (90) single- family lots are proposed. (FP03-0007, The Vintage Phase 2-B, Deborah Viera) Motion by Joe Mulroy and seconded by John Johnson to approve the Consent Agenda. *Discussion of item is included in the Court Reporter's transcript attached to this set of minutes (Page 1) Motion carries 7-0 ITEMS FOR INDIVIFIIJAI, CONSIDERATION The parcel contains approximately 12 acres and is located on the north side of Jim Christal Road west of the GC & SF Railroad. The property is currently designated as an Industrial Center, Employment (IC-E) zoning district, buildings currently exist on the site and no new construction is proposed. Consider making a recommendation to City Council regarding exaction variances of Section: A. 35.20.2(L.3.A.) of the Code of Ordinance concerning improvements to a perimeter street Motion by Joe Roy and seconded by Joe Mulroy to recommend approval to City Council for the street variance. *Discussion of item is included in the Court Reporter's transcript attached to this set of minutes (Page 2) Motion carrie.q 7-0 B. 35.20.3(B.) of the Code of Ordinance concerning perimeter sidewalks and Motion by John Johnson and seconded by Joe Mulroy to recommend approval to City Council for the sidewalks variance *Discussion of item is included in the Court Reporter's transcript attached to this set of minutes (Page 2) Motinn carries 7-0 C. 35.20.2(H.1.) of the Code of Ordinance concerning the dedication of right of way for all streets that serves a commercial lot (regarding ROW for a cul-de-sac at the end of Jim Christal Road at its intersection with the GC & SF Railroad). Motion by Joe Roy and seconded by Joe Mulroy to recommend approval to City Council for the right way variance. *Discussion of item is included in the Court Reporter's transcript attached to this set of minutes (Page 2) Motion carries 7-0 FROM : GTGMOJG- Jul. ~1 ~00~ ll:0gAM P1 FAX NO. : g40 GSG$~8 Condons~ltTM 6 7 8 9 tl 12 14 15 115 i7 18 t9 2O 21 24 PROCEEDINGS COMMISSIONER APPLE: Good evening. At this f~me t wilt oa[l to order the regular meeting of the Planning and Zoning Cmmnission for the City of Denton, Texas on ~i$ W~y, July tl~ 2Md. Pleas~ jola us trq We smud to Pledge of Allegienoe to ti~ United States flag and tho Texas flag. (Thereupon, the Pledges of Allegiance were recited.), COMMISSION --F-2,'~ APPLE: Next we'll consider' approval of our minutes for the July 9th, 2003 m~ting. .ado there any e.~orr~fion$? Cornm~ion~ Roy. COMMISSIONER SOY: MOVe approval of the minutes. COMMi,~SIONER MULROY: secured. COMMISSIONER APPLE: W~ have a motion and a ,,~cond to approw the minutes. Any discussi~m? Hearing non~, vot;, please. Conuni~simmr Mulroy, your vote 'has. not registered, Thc~e you go, Mc~ion carries 7-0, The next item is the Con~nt Agm~da, which consists of Item 3A through D, COM'MI~IONER M'UI.ROY: I move approval, Madam Chair. COMMISSIONER JOHNSON: Second. Page 2 I COM~I~[ONI~R APeLE: W0 have a motion 2 approve and a smond. ~y ~cu~ion? Vo~ 3 Motion ¢~ 7-0, 4 I~ 4 on o~ A~, which ia at. ally 5 only i~ oa o~ ~1~ ~m~g i~ an im for 6 in~hdual eonsid~on. And Bud Vokoan wi~ 7 Stuff ~]i p~cnt, W~'I! ~ making one proletarian for 8 I~s A, B and C, bnt t~n we wilt n~ sepamm motions 9 f~ tach it~. l 1 hdy and ~tl~ of ~ ~aion. Bud I2 ~nmring, You Im~ ~fom you a ~qr hy 13 S~pp, eE, ~, applioant of ~* pm~ ~m~ting 14 Aeq~skioa C~om0mh d~do~ of fl~ ~arl~ Addition I $ who ~s appH~ for ~actioa variant. Vorian~ 03~01 t6 pa~q & B, and C of ~ Harl~ Addition of ~dons 17 35.20.2(L.3.a) conc~nh,8 improv~mat, m a 18 ~t and 35.20.3(B) eone~ohag [,smllafion of~imot~ 19 SiSal[ and 35.20.2~.1) tone,fflng right,f-way 20 ~ioation s~fici~l tbr a c~-~-hqo. P~co] ~1 approx;mamly 12 ae~g nnd [~ loca~ on the noflh ~ide of 22 lira O~sml R~d w~t of t~ ~ & SF gaik~d, 23 Tlc pretty L~ empty d~igna~ 24 influ~wlal ~n~ ~p~at ~ing distriot. Buildings 25 cu~nfly ~ On ~ si~ and ~ ~n$~oa 1 2 4 5 6 7 8 9 10 I 12 13 14 t5 17 19 21 ~2 23 24 Page ~"' propomd. Staff is agreeing with thc applicant *o not rcquk¢ the throe variancx:s prcviou,ly explained prlm&riiy becaum they do not plan on improving tt~ l~or>erties. Tl~ir iment is to simply subdivid~ off this parcel here so that they eau have this lot on a goparale parcel, Beeau~ they are not. improving may part of it, staff is agreeing that the roadway 'along the frontage as welI as thc sick:walk and b~ause of some on-site facilities, namely tlti~ existing booster pump house, a~ well as some parts of the parking lot m within thc prot~ed right-of'-way, that staff fecN that both the sidewalk, the pavement and the right-of-way is not appropriat~ at this point. Staff would like to point out that we did re, comm~nd that as a ¢ondi6.on of this approval, should sometime i~ tho future the owner and/or owners o£either proporW come in for h~prove2oxmts to either of thee sites that the variances wou}d become null mad void. And with that, that ends staff's prc~m 'ration. You have additional in£ormation in your pamphlet, And the ~pplteaat is here should you have questions. COMMI,~3IONER APPLE: DOgS the apptlcant wSsh to say anything? MR. aHi~P~ I'm here to an,~wcr any Pago 4 ! q~ostions might you haw any. 2 COMM[SStONER APPLE: ~ thom any 3 q~tlons, Gmmni~sioma's? Conunission,r Mulroy. 4 COMMf,...~IONI~.R ~¥: xinet lmve one $ qu~fion for l~gal, ls that mllow~blv ~o do ~ conditional 6 v~i~ ~ar ir w~ ~ w~ d~ng on ~ 7 actions of ~ pm~ own~s? 8 ~R. s~om ~ now and w~ wc mkc 9 ~g tO Ci~ ~unoil, I fl~ink we mi~xt ~ve ~ ~word i0 ~ndition. ~at com~ to my mind, if lh~'m not 11 in for -- if &¢y ~t a building ~m~; m add a diff~nt 12 buit~ng, ~n, no, it d~ not ~m a mp~t flm~ our 13 ¢'di~mn~ d~ not ~ulm tim ~action. SO wa would ~w 14 ta ~ord flint eon~n a li,le bit But I und~a~nd 16 wri~e~ from t~ to 17 ~MMI~IONm M~OY: okay. Tlmuk you, ] g COMMI~ION~ APPLfl: ~ ~1~ ally Ofl~ 19 q~ons or a moffon? ~mfission~ Roy. 20 co~l~oN~ gev: ~ move approval of ~ 21 Item 4A ~ gti~uht~ by g~ff. 22 COMMI~ION~ ~ULROY: ~Olld. 24 s~ond for approval of I~ A. ls ~ any H~fing non~ vo~, pl~,~, Motion c~i~ 7~. PLANNING & ZONING COMMISSION IULY 23, 2003 Page 1 - Page 4 FROM : 5TSMOJG- Jul. 31 2003 11:10AM P2 FAX NO. : 940 GSGS348 Cond~s~ItTM Page 5 i Commissioner Johnson. 2 COMMIS~IONI~R $OHNSON: lql mOVe approvaI 3 of ltem 4B wi~ the stipulation ~ outlined by s~ff. 4 CO~glONER ~ROY; ~nd, 5 CO~SSIONER ~e~; We ~vc a motion ~d a 6 ~cond to approve 4B, Any ~sim? Vole, pl~, 7 M~ion ~ 7-0, 8 Co~ion~ Roy. 9 CO~I~ON~ ROY: ~ l~OV~ ~prov~l of I~ 1~ COMMISSIOneR ~L~: We have a motion ~d a 13 ~nd ~ approve 4C~ ~a7 ~,ion? VoZ, pt~. 14 Motion o~ea 7-0. Am rh~ any [tol~s for Mtum 15 buainesa? 1 ~ CO~L%~IONER POWELL: M~n Chaimama. I7 COMMISSIONER ~PL~: Co~mniss~on~ Powcll. 18 COMMISSIONER POWELL: I wo~ld ii~ to point 19 out ~s is ~ ~ao~ m~fing on ~ord. I just waned 20 ~ ~Mt ~t out. 21 COMMISMON~ APPLE: Th~ you for ~lling 22 ~at to O~ a~fion, ~missi~er Powcll. With that, we 23 stud adjoin. 24 PLANNING & ZONING COMMISSION JULY 23, 2003 Page 5 - Page 5 AGENDA DATE: DEPARTMENT: ACM: AGENDA INFORMATION SHEET August 19, 2003 Fiscal Operations, Tax Department Kathy DuBose, Fiscal and Municipal Services SUBJECT Hold a Public Hearing on a proposal to adopt a tax rate of .54815 per $100 valuation, which will exceed the lower of the rollback rate or 103 percent of the effective tax rate. BACKGROUND In the Friday, August 1, 2003, Reading File, staff provided Council with a copy of the required notice of effective tax rate calculation to be published in the Sunday, August 3 newspaper. Municipalities are required to publish their rollback tax rates in the newspaper, along with the effective tax rate and other required schedules. The rollback tax rate divides the overall property taxes imo two categories--maimenance and operations (M&O) taxes and debt service taxes. By law, the rollback rate for taxing units are set at an eight percem (8%) increase in operating (M&O) taxes. The effective tax rate is generally the property taxes divided by the current year's taxable value of properties that were on the tax roll in both years. This rate excludes taxes on properties no longer in the taxing unit and also excludes the currem taxable value of new properties (growth). The City of DeMon's effective rate is $.53166/$100 valuation and the rollback rate is $.69912/$100 valuation. The Property Tax Code specifies that "if a taxing unit (other than a school district or small taxing unit) proposes a tax rate that exceeds the lower of the rollback rate or 103 percent of the effective tax rate, the taxing unit's governing body must vote to place the proposal to adopt the tax rate on the agenda of a future meeting as an action item". While the proposed 2003-04 budget keeps the current .54815 rate unchanged, it is 103.1% of the effective tax rate and requires a public hearing. ESTIMATED SCHEDULE 08/05/03 08/10/03 08/19/03 08/24/03 09/02/03 Vote to place Proposal on Future Agenda Publish Required Notice Hold Public Hearing Publish Second Required Notice Adopt Tax Rate PRIOR ACTION/REVIEW City Council held a budget work session on August 7, 2003. FISCAL INFORMATION The proposed property tax rate is included in the 2003-04 proposed budget. EXHIBITS Notice of Public Hearing Respectfully submitted: Diana G. Ortiz Director of Fiscal Operations Notice of Public Hearing on Tax Increase The City of Denton, Texas will hold a public hearing on a proposal to increase total tax revenues from properties on the tax roll in the preceding year by 3.1 percent. Your individual taxes may increase at a greater or lesser rate, or even decrease, depending on the change in the taxable value of your property in relation to the change in taxable value of all other property and the tax rate that is adopted. The public hearing will be held on August 19, 2003 at 6:30 p.m. at the City Council Chambers in City Hall located at 215 E. McKinney Denton, Texas 76201. FOR the proposal: AGAINST the proposal: PRESENT and not voting: ABSENT: The following table compares taxes on an average home in this taxing unit last year to taxes proposed on the average home this year. Again, your individual taxes may be higher or lower, depending on the taxable value of your property. Average residence homestead value Last Year This Year $110,423 $117,730 General exemptions available (amount available on the average homestead, not including senior citizen's or disabled person's exemptions) $5,000 $5,000 Average taxable value $105,428 $112,730 Tax Rate .54815/$100 .54815/$100 Tax $577.90 $617.92 Under this proposal, taxes on the average homestead would increase by $40.00 or 6.92 percent compared with last year's taxes. Comparing tax rates without adjusting for changes in property value, the tax rate would increase by $.00¢ per $100 of taxable value or 0 percent compared to last year's tax rate. These tax rate figures are not adjusted for changes in the taxable value of property. AGENDA INFORMATION SHEET AGENDA DATE: August 19, 2003 DEPARTMENT: Management and Budget ACM: Kathy DuBose, Fiscal and Municipal Services SUBJECT Hold a public hearing and receive citizen input on the 2003-2004 proposed budget. BACKGROUND City Charter and State Law require that prior to adoption of the proposed budget, a public hearing be conducted to allow citizens the opportunity to provide input on the proposed budget. The required notice has been published and a public hearing has been scheduled as required. PRIOR ACTION/REVIEW (Council, Boards, Commissions) The proposed budget was delivered to City Council on July 31, 2003 and was discussed at a budget workshop held on August 7, 2003. FISCAL INFORMATION The proposed 2003-2004 budget totals $340,609,746 in estimated resources and $339,198,691 in estimated expenditures. Respectfully submitted: Kathy DuBose, Assistant City Manager Fiscal and Municipal Services AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: CM/DCM/ACM: August 19, 2003 General Government Betty Williams, Director of Management & Public Information Michael A. Conduff, City Manager SUBJECT: Hold a public hearing to afford the public appropriate notice and participation for the purpose of commenting on the cable television franchise application filed by Denton Telecom Partners I, LP d/b/a Advantex Communications, with the City of Denton. BACKGROUND: In December 2001, the City learned that CoServ Communications L.L.C., d/b/a CoServ Communications (CoServ) was providing cable television to the Robson Ranch Development. Research revealed that CoServ was using public easements within the Denton city limits to provide cable television service, without a cable television franchise with the City. This is a violation of Ordinance 99-121, Sections 8-164 through 8-167. In January 2002, CoServ was contacted by the City and requested that CoServ apply for a cable television franchise. CoServ met with the City and revealed that they had filed for bankruptcy on November 2001. CoServ did file an application for a cable television franchise on March 4, 2002. In May 2002, the City sent CoServ an Interim Grant of Authority that would allow CoServ to provide cable service, until a Cable Franchise could be negotiated. In July 2002, the City was notified that CoServ was in the process of coming out of bankruptcy and the assets (system) were to be sold or transferred to the creditor bank. All Interim Grant of Authority negotiations stopped at that time. In December 2002, the City received notice that CoServ cable television operations had been assigned by the bankruptcy court to Denton Telecom Partners I, LP d/b/a Advantex Communications (Advantex). In January 2003, the City sent Advantex a proposed Interim Grant of Authority and a cable television franchise application. The City requested that Advantex begin negotiations with us on an Interim Grant of Authority agreement for the cable service being provided to the Robson Ranch development. The Interim Grant of Authority that was submitted to Advantex contained similar but not identical language that is found in the current cable franchise agreement with Charter Communications. Advantex responded in February 2003, stating that the proposed agreement was "...voluminous and comprehensive agreement reflective of the large system operated by Charter throughout the City." They recommended a revised franchise agreement, "which is reflective of the small size of our system." ADA/EOE/ADEA www.cityofdenton.com (TDD 800-735-2989) 8/8/03 Advantex Interim Grant of Authority Page 2 of 2 In March 2003, the City responded to Advantex and reiterated that federal law requires us to keep the terms of our cable franchise agreements comparable. We also advised them that we understand that they have a small cable system and therefore inserted language in their agreement that would delay the activation of several of the requirements until a certain subscriber thresholds are reached. We also referenced the cable related needs of our community and requested a meeting with them within 30 days to begin the negotiation process. In March 2003, the City did receive a partial cable television franchise application. In April 2003, Advantex rejected the City's proposed Interim Grant of Authority and instead submitted their own proposal. The City reviewed Advantex's proposal and rejected it because it failed to meet several cable community needs. In April 2003, Advantex contacted the city and questioned whether the Interim Grant of Authority adhered to the Telecommunications Act of 1996 and portions of the 1984 and 1992 federal acts.. The City researched these issues and found that the Interim Grant of Authority was in compliance with the federal Communications Act of 1984, as amended 1992 and 1996, and Chapter 8 of the Code of Ordinances of the City of Denton, Texas. In June, The City notified Advantex of our findings and again requested a meeting with them within 30 days to begin the negotiation process. On August 7, 2003, Advantex met with the City and began the negotiation process on the Interim Grant of Authority. Advantex also submitted a payment for franchise fees and a completed cable television franchise application. PRIOR ACTION/REVIEW (Council, Boards~ Commission): Legal Status Report on May 2, 2003. FISCAL INFORMATION: City will receive 5% of Advantex gross revenues as franchise fees. Respectfully submitted: Baett y Wi~ams - Director of Management and Public Information Prepared by: _ liCabrales Jr' c Information Officer Attachments 1. Advantex Application 2. City's Cable Franchise Application (Ordinance 2000-204) ADA/EOE/ADEA www.cityofdenton.com (TDD 800-735-2989) 08/08/2003 11:23 FAX 9402706744 Co-Sexy ~002 Application for A Cable Franchise THE CITY OF DENTON, TEXAS DENTON TELECOM PARTNERS I, L.P. d/bla ADVANTEX COMMUNICATIONS 7701 S. Stcmmons Corinth, Texas 76210 ("Applicant" or "Advantex") August8,2003 08/08/2003 11:23 FAX 9402706744 Co~Serv ~003 1. Contact: Mr. Terry Falls Vice President Chief Operating Officer Advantex Communications 7701 S. Stemmons Corinth, TX 76210 940-270-7499 940-270-8173 Fax ffalls~advantexcom.com 2. Identification of Owners ("Applicant") LZ (As of Denton Telecom Partners I, L.P. d/b/a/Ads The Company's officers are listed below. Current Officers: Chief Executive Office: Vice President and Chi Vice President and Chi E. Clarke Gamett: David Frost Terry Falls 3. Local Counsel: The Applicant has not retained local coma: should take place directly with the Advantex, 4. Criminal Proceedings: Neither the Applicant nor any related emity proceeding (felonies or misdemeanors) in wh ,GAL ugust 2003) 155708-1 aatex Communieations is a Delaware partnership. ~Financial Officer Operating Officer ~el. All correspondence regarding this application ~ntact listed above. ~r principal has ever been convicted in a criminal ch any of the following offenses were charged: a. Fraud, bribery, extortion, embezzle~nent b. Tax evasion c. Perjury, jury tampering, obstructio~ of justice, judicial officers performance of tMir duties. d. False, misleading or deceptive adv e. Anti-mast violations, state or feder f. Violations of FCC rules and regul~ g. Conspiracy to commit any of the or other misconduct affecting public or raising tions xgoing offenses 06/08/2003 11:23 FAX 9402706744 Co-$erv ~004 5. Civil Proceedings: Neither the Applicant nor any related entit proceeding in which it was held liable for any a. Unfair or anti-competitive business b. Anti-trust violations (state and fede] were entered c. Violations of securities laws (state i d. False, misleading or deceptive adv¢ c. Violation of FCC roles and regulati. 6. Unlawful or Unenforceable Provisions: The Applicant, Advantex, does not contend t Ordinance No. 2000-204 which is applicabk insofar as such provisions arc identified and ~ to the City by Advantex with this Application 155708-1 nor any principal ever been a party to a civil ~f the following: iractices al) including instances in which consent decrees nd federal) rtising iat any provision of Chapter 8 of the City Code or .to Advantex is unlawful or unenforceable except taived in the Cable Franchise Agreement submitted 08/08/2003 11:24 FAX 9402706744 Co-Serv FIN Advantex Communications acquire from the United States Bankrupb Texas, Fort Worth Division. AdvaI Funding Corporation is only opera they can be sold and will not be a 1, ~.NCIAL d their assets on December 14, 2002 g Court for the Northern District of :ex is a subsidiary of the Cooperative ting these cable television assets until mg term service operator. 005 TECHNICAL This section is designed to gather information relating to the Applicant's proposed Cable System. The Applicant's Cable System is already built and currently serves customers, therefore the questions will be answered for the cable system as it exists. 1. Geographic Area. CoServ operates its Cable System at the Robson Ranch Community. Robson Ranch is located off Crawford Road at Interstate 35 West in Southwest Denton County. The Cable System serves twenty-two (22) customers. Included as Attachment #1 to this Application is a map of the fixed facilities and the routes of the cables, wires and other facilities of the Cable System. 2. The entire Cable System in Robson Ranch is located underground. 3. The Applicant has not interconnected the Cable System with any other cable television, telecommunications or open video system. 4. The Applicant offers the following services through its cable television system: g. video programming services The Applicant offers the following types of services through systems separate from its cable television system: a. private switched telephone services b. local switched telephone service to City residents through its own facilities c. long distance services through its own facilities d. high-speed data transmission services e. interact access services. The Applicant does not offer the following services through its cable television system or any other system: f. video conferencing services h. wireless telecommunications services I transmission capacity to other entities sale or lease The systems and facilities which are offered by the Applicant are offered to the residents of the Robson Ranch Community Applicant's cable television system has been built and currently serves 22 customers in the Robson Ranch Community. The Cable Television System was designed so that it can be extended as the community grows and additional homes are built. o Cable System Description a. System construction began in August 2000. b. The Cable System has downstream channel capacity of 110 analog channels, 72 of which are activated. 143261-1 6 c. The Cable System does not have upstream channels activated or an institutional network and it is not interconnected. d. ~/ Standard Carders e. The System does not have public access channels. f. A fee schedule is included as Attachment: Technical # 6.f. g. Applicant's Customer Service measures. We stay within the FCC and NCTA standards of performance. CoServ measures and tracks the following: °:° # of Calls offered, o$o # of calls received, °$o Average hold times (:30 sec), o:o Average Abandoned % (5%), o:o % Calls answered within :30 o~* Days out on installation, o:o Response to trouble, reason, time and resolution. h. Applicant's safety measures and safety programs,:_ CoServ operates its Cable System pursuant to the following OSHA procedures: o:o Safe Vehicle Operation, o~* Personal Protective Equipment, o:o Safe Use of Installation Hand Tools, o:o Workplace Safety and Safety Around Electricity. i. Applicant operates its Cable System on a 24 hour a day basis. Channel Capacity The Cable System has 110 analog channels of which 72 are activated. Downstream 72 video channels 0 audio-only channels 0 data channels 0 voice channels Upstream 0 video channels 0 audio-only channels 0 data channels 0 voice channels System Design a. 350 hp optic node, 860 MHz forward, return 5 to 42 MHz b. The Cable System has 3 amplifiers in cascade. c. The Cable System has one line extender in cascade. d. The Cable System is in compliance with FCC minimums. Projected system distortions will never be less than FCC minimums and will generally surpass FCC title 47 part 76 mandated performance criteria. 143261-1 7 The Applicant has not had a business license, including a license obtained from the FCC revoked or suspended nor has the Applicant had any franchise renewal denied. Further, the Applicant is not party to any proceedings which would result in any such revocation, suspension or non-renewal. 10. The Applicant has not, as a result of an adjudicated proceeding, been found in violation of any franchise ordinance or agreement, contract or regulation governing a cable television system owned or operated by Applicant. 11. Applicant has not initiated litigation against a franchising authority nor has a franchising authority initiated litigation against the Applicant. 12. The Applicant has not been cited by a franchising authority for not meeting Federal Customer Service Standards or Customer Service Standards set out in any local franchise agreement or ordinance. .__ 143261-1 8 I certify that I am authorized to execute this Application on behalf of the Applicant. I further understand that if there are material omissions of information requested by this Application Or deliberately false answers given to questions on this Application, the City of Denton, Texas, may revoke any franchise, permit or license it has granted in reliance on its answers provided by Applicant to this Application. Date Notary Signature Line STATE OF CoServ Communications L.L.C. By: }~ Chism Its: ~resident 143261-1 9 CD CD CD 0 I: NOT F~"'F_~TERNAL DiSTRiBuTION TELECOMMUNICATIONS ENTITIES DENTON COUNTY ELECTRIC COOPERATIVE, INC. Last Updated 03/05/2001 COSERV UTILITIES SERVICES, INC. 1% I 99% GP LP , ~ (f/k/a DCE Services, Inc.) COSERV TELECOM GP, { :- L.L.C. COSERV SPECTRA GROUP, L.L.C. THE MASTERLINK GROUP, INC. VIRTUAL SPORTS PARTNERSHIP, LTD. MULTITECHNOLOGY SERVICES, L.P., d/b/a COSERV BROADBAND SERVICES 99% LP COSERV TELECOM HOLDINGS, L.P. COSERV COMMUNICATIONS PARTNERS, L.P. COSERV, L.L.C., d/b/a COSERV COMMUNICATIONS DWB GP, INC. DALLAS WIRELESS BROADBAND, L.P., d/b/a COSERV BROADBAND E E IL. ~_ CL ~O/E L/~-9~# ORDNANCE NO. 000 AN ORDINANCE IN ACCORDANCE WITH SECTION 8-31 OF THE CODE OF ORDI- NANCES OF THE CITY OF DENTON, TEXAS, APPROVING AN APPLICATION FORM FOR AN APPLICANT FOR A CABLE TELEVISION FRANCHISE; SETTING A NON- REFUNDABLE APPLICATION FEE FOR THE COSTS OF REVIEW, ISSUANCE, AND ENFORCEMENT OF THE APPLICATION FOR A FRANCHISE; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, Section 8-31 of the Code of Ordinances of the City of Denton requires that no cable television fi:anchise may be issued or renewed except upon written application to the City Council on an application form prescribed by the City Council; and WHEREAS, the City has hired a cable television consultant, Charles Gramlich, to assist in the process of preparing the application form; and WHEREAS, Section 8-31 of the Code of Ordinances requires that each applicant must submit a non-refundable application fee, which must be established by the City Council, to cover costs of review, issuance, and enforcement; and WHEREAS, the City Council deems it in the public interest to approve the cable televi- sion franchise application form and to set a non-refundable application fee; NOW, THERE- FORE, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS: SECTION 1. The attached form entitled "City of Denton, Texas Application for Cable Television Franchise" is hereby prescribed, adopted, and approved as substantially in the terms of the attached form, which is made a part of this ordinance for all purposes, for the use of any cable television franchise applicant, whether seeking a new franchise or the renewal of an exist- ing fxanchise, in accordance with Section 8-31 of the Code of Ordinances. SECTION 2. The City Council hereby establishes a non-refundable application fee for any application for a cable television franchise in the nonrefundable amount of five thousand dollars ($5,000). SECTION 3. The City Manager or his designee is authorized to require that any cable television applicant complete the attached application form and provide all the information re- quired and such other information as the City Council may deem necessary to review the appli- cant's legal, technical, and financial qualifications and its ability to meet the future cable-related needs and interests of the City. SECTION 4. This ordinance shall become effective immediately upon its passage and approval. day of ,2000. EULINE BROCK, MAYOR ATTEST: JENNIFER WALTERS, CITY SECRETARY HERBERT L. PROUTX, CITY ATTORNEY BY: Page 2 \\CH-LGL\VOLlXshared\deptXLGL\Our Documents\Ordinances\00\cable tv franchise application.doc CITY OF DENTON, TEXAS APPLICATION FOR A CABLE TELEVISON FRANCHISE This application form is to be completed by any applicant for an initial cable television franchise or by an existing Cnante~ requesting renewal ofthe cable television franchise. The City of Denton, Texas ("City") requests that the Applicant complete the following information for its use in reviewing the Applicant's legal, technical, and financial qualifications and its ability to meet the future cable-related needs and interests of the conmamity in accordance with Section 8-31 of the City Code. AH applications received by the City from the applicants for an initial cable television franchise or a renewal will become the sole property of the City. The City reserves the right to reject any and all proposals and waive informalities and/or technicalities where the best interest of the City may be served. Before submitting a proposal, each applicant must: Examine the application documents thoroughly. Familiarize himself/herself with local conditions that may in any manner affect performance under the franchise. Familiarize himself/herself with federal, state and local laws, ordinances, rules and regulations affecting performance under the fi-anchise, including Chapter 8 of the City Code. Carefully correlate the application with the requirements of this procedure and the application documents. The City may make such investigations as it deems necessary to determine the ability of the applicant to perform pursuant to the Code of the City, and the applicant shall furnish to the City all such information and data for this purpose as the City may request. City staff may request additional information or revise this application form to fit changing circumstances. The City reserves the right to reject any application if the evidence submitted by, or investigation 0f, such applicant fails to satisfy the City that such applicant is properly qualified to carry out the obligations of the Code of the City and to complete the work contemplated therein. No cable television fi'anchise will be granted to any applicant unless aH requirements and requests of the City regarding the legal, financial and technical qualifications and the plans for the proposed cable television system of the applicant have been met, including compliance with all applicable requirements of the City Code. Applicants, including all shareholders and parties with any interest in the applicant, shah submit aH requested information as provided by the terms of this procedure or the applicatioi~ docmnents. The requested information must be complete and verified as true by the applicant. Applicants, including aH shareholders and parties with any interest in the applicant, shah provide the following information regarding other cable systems in which they hold an interest of any 1. 2. 3. Locations of all other franchises and the dates of award for each location.. Estimated construction costs and estimated completion dates for each system. Estimated number of m~es of construction and number of miles completed in each system as of the date of this application. Date for completion of construction as promised in the applieation for each system. Applicants, including aH shareholders and parties with any interest in the applicant, shall provide the City with any documents regarding pending applications for other cable systems, including but not limited to, the following: 1. Location of other fi'anchise applications and date of application for each system. 2. Estimated dates of franchise awards. 3. Estimated number of miles of construction. 4. Estimated construction costs. LEGAL Please provide the name, address, telephone nmnl~, fax number and ~-mail address (if · ava~ble) ofthe person that the City should contact regarding this application~ Identification of Ownem: If a corporation, state the names and addresses of ail o~ and directors and the number of shares held by each o~ and director. Also provide identification and own~hip interest for each nominal and lxone~ owner of one ~ (1%) or more of applicant's issued and outstanding stock. If an incorporated association state the nan. s, addresses and outstanding ownership intere~ of all members and ultimate Ifa partnership, provide identification and ownership interest for all general and lia~ted c. Ifa proprietorship or other entity, provide full ownership details. If the applicant is a subsidiary, will its parent corporation guarantee the obligations and Has the Applicant retained local counsel to represent the company in the renewal process? If so, please identify the firm and indicate which correspondence should be forwarded to them. Has the Applicant or any related entity or principal ever been convicted in a crkninal proceeding (felonies or misdemeamrs) in which any of the following offenses were charged? YES NO Fraud, bn'be~, extortion, embezzlement b. Tax evasion obstruction ofjustice, or other misconduct affecting public or judicial officers' performance of their public dmies do False, misleading or deceptive ~ Anti-tn~ violations, state or federal f. VioLations of FCC rules and regulations g. Conspiracy to commit any of the foregoing offenses Disposition of Criminal Charges. If the answer to any question above is yes, attach a separate statement describing the disposition of each crhnk~ charge, including the date, court, sentence, or fine. 5. Is the Applicant, or related entity or any principal a party to or has the Applicant, or related entity or any principal ever been a party to a eivi proceeding in which it was held liable for any of the following? YES NO bo go Unfair or anti- competitive business practices Anti-trust violations (state and federal) including instances in which consent decrees were entered Violations of securities laws (state and federal) False, misleading or deceptive advertising Violation of FCC rules and regulatiom Disposition of Civil Proceedings. If the answer to any question above is yes, attach a separate statement descntfing the civil proceeding and state the disposition of that case. Does the Applicant contend that any provision of the City Charter or Ordinances applicable to the Applicant or the proposed cable system serving the City is or may be unlawful or unenforceable? FINANCIAL The ~ finamial condition of the Applicant is requested in order to have an ulxlema~ing of the fimncial arrangeme~ that rmy impact the continuing operatiom of the proposed cable system. 1. What is the source and amount of equity capital? 2. Is any ofthe equity capital borrowed? 3. What is the primary source and amount of debt? Provide the name ofbanks and/or lending institutiom and ~ the name and title ofthe bank officer or lending officer who has authorized the financing. 5. Please identify the terms of all debt financing. 6. What interest rate? 7. What collateral is involved? 8. Who are the guarantors? Please provide all current financial statements that support financial viahlity of the proposed cable system's operations. 10. Please provide historical financial statements (audited or reviewed, if available) for the past two .years for the Applicant. 11. Please supply docmmmation that assures the proposed the Applicant's financial viability, such as letters of commitment from financial institutions, which will demonstrate tl~ availabfl~ of suflk:ient funds to construct, operate and maintain the cable television system in the City. 12. Please provide pro forma financial projections for the operation of the proposed cable television system in the City. Please include detailed revenue and expense projections and assumptions for the operation of the cable television system serving the City for the next five years. Please include a sources and uses of funds. 13. The leverage profile of the Applicant is of concern to the City. Please provide infonmtion that describes the projected leverage profile of the Applicant and related entities at the end of the next five yearn Please include the following ratios in your answer:, total debt per subscnl~r and total debt per the numing rate cash flow. 14. Please provide a narrative that discusses the leverage profile of the Applicant and related entities to include: a comparison of the leverage profile to other multiple system operators in the cable tele 'wsion induslry and the anticipated effect of the leverage profile on the ahlity of the Applicant to construct, operate and ~ the proposed cable te~.sion system inthe City. 15. Please provide current financial stat~s for all owners of five percent (5%) or greater ownership interest in the Applicant. Any other information that the Applicant wishes to provide which will help the City develop an accurate picture of the financial condition of the Applicant w~l be welcomed. TECHNICAL This Section includes technical questions relating to the Applicant's proposed cable system. Describe in detail the geographic area within the City where the Applicant proposes to offer cable television services and a schedule for buildout. Indicate the approximate location on a map, or by description, of the fixed system facilities, including tower, satellite earth stations, microwave lkflcs. The routes of the wires, cables and other lhcilities. If any of the proposed cable television system is to be installed overhead, evidence the surplus space available for locating the proposed cable television system on existing utility poles along the proposed route. Does the Applicant intend to interconnect the proposed cable television system with other cable television systems, telecommunications systems or open video systems? Presuming the Applicant obtains a cable television franchise fi:om the City, please descn'be the types of services the Applicant plans to provide through its cable television system or any other system by answering the following questions: Does the Applicant plan to offer private, switched telephone services to customers? Does the Applicant plan to offer local switched telephone service to City residents either through its own facilities or as a resale carrier? Does the Applicant plan to offer long distance services either through its own facilities or as a resale carder? Does the Applicant plan to offer customers high-speed data transmission services? Does the Applicant plan to offer customers Interact access capabilities? g. i. Does the Applicant plan to offer video conferencing services to customers? Does the Applicant plan to offer any type of video programming service to its customers, including cable television, open video system service, or video dial tone service? Does the Applicant plan to offer wireless telecommunications services to customers? Does the Applicant intend to lease or sell transmission capacity on its system to other entities? If any of the questions above were answered "Yes," please descn'be in detail to whom, how and when such services or facilities are planned to be offered. Provide a schedule and completion dates for development and construction of the Applicant's proposed cable television system. The schedule for buildout should set forth the approximate starting and completion dates of construction of the system and the dates service will actually be available to the areas named. Please identify and provide the following information regarding the Applicant's proposed cable television system do Beginning date of construction of system. Number of downstream channels. Number of upstream charmels, discuss and describe any institutional networks and interco~ion services. Channel Format (Check one) Standard Carriers Harmonically Related Carders go Other (please describe Number of public access channels. Complete fee schedule including subscription fees and other charges. Quality of service ~ including Applicant's procedure for handling customer complaints. Safety measures and safety progxams. Hours of 0peration. 7. Indicate the anticipated channel capacity of the proposed cable television system: # of video channels # ofaudio-oniy channe~ # of data channels # of voice channels Upstream # of video.channels # of audio-only channels # of data channels # of voice channels 10. 11. System Design What are the systcun's design parameters? What is the longest trunk amplifier cascade? How many line extenders in cascade? What are the projected worst-case distortion characteristics? Has the Applicant ever had a business license, including a license obtained fi.om the FCC revoked, suspended or the renewal thereof denied, or is the Applicant a party to proceedings that wfll result in the same? Has the Applicant ever, as the result of an adjudicated proceeding, been found in violation (other than routine service complaints) of any franchise ordinance or agreement, contract or reguhtion governing a cable television system owned or operated by it? Has the Applicant ever initiated litigation against a franchising authority or has a franchising authority initiated litigation aga~t it? If so, identify the franchising authority involved, the court or administrative agency in which that litigation was docketed, the nature of the controversy that was the source of the litigation, the disposition or result of that litigation, and any other relevant facts. 12. Has the Applicant been cited by any fi-anchising authority for not meeting the Federal Customer Service Standards or Custo~ Servico Standards set out in any local franchise agreem~ or ordinance? Any other infonmtion that the Applicant wishes to provide which will help us develop an accurate picture ortho technical condition ofthe operation will be welcomed. of $ to cover the costs of review, immme and enfo~ of the proposed I certify that I am authorized to execute this Application on behalf of the Applicant. I further understand that if there are material omissions of information requested by this Application or deh'bemtely false answers given to questions on this Application, the City of Denton, Texas, may revoke any franchise, permit or license it bas granted in reliance on the answers provided by Applicant to this Application. Date: Name of Applicant By Notary Signature Line AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Economic Development Mike Conduff, City Manager SUBJECT CONSIDER ADOPTION OF AN ORDINANCE OF THE CITY OF DENTON, TEXAS ESTABLISHING AN ECONOMIC DEVELOPMENT PARTNERSHIP BOARD; AND PROVIDING AN EFFECTIVE DATE. BACKGROUND City Council received a report on TIP Strategies Economic Development Plan recommendations at the May 20, 2003 City Council meeting. The report provided information on the process followed in the development of the report, four target projects, and suggestions for economic development structure. At the June 10, 2003, planning session, economic development outcome statements were discussed. It was suggested that a committee of Council members and Chamber of Commerce Board members review TIP's suggestions for structural change and make recommendation to the full City Council. The committee met and drafted structural and procedural guidelines that appear in the attached ordinance. The key difference between TIP's recommendation and that of the committee is in naming specific Council members and Chamber Board members to the Economic Development Partnership Board. TIP suggested that the Mayor and Mayor Pro-Tem and the Chair and Chair-Elect of the Chamber of Commerce Board be appointed to the EDP. The committee recommends that two members of the City Council and two members of the Chamber Board be appointed. This allows flexibility so that those who may want to serve have an opportunity. Also, should the current or future Mayor or Mayor Pro-Tem feel overcommitted in other areas, it allows them the opportunity to decline serving on this board. In addition to the two Council members and two Chamber Board members, the EDP Board will have representation from the University of North Texas with either the President or his designee serving. The final two members of the EDP will come from businesses representing the City's top twenty taxpayers. The process for establishing the EDP Board differs from most other board or commission appointments. Since individuals will be selected from defined categories, the ordinance calls for a nominating committee comprised of two City Council members and one Chamber Board member. The nominating committee will receive nominations from the City Council and the Chamber of Commerce Board and present a slate of EDP Board members to the City Council for approval. The EDP Board will be responsible for implementation of the four projects outlined in the TIP Strategies report. They may create task forces or committees to assist in these areas. In addition, the board will review and make recommendations on both City and Chamber economic development annual action plans and budgets. The board will also serve as an economic development policy board. They will review prospect incentive packages and make recommendation to City Council. Creation of this board will replace the current Economic Development Committee (as structured under the City's agreement with the Chamber of Commerce) and the Joint Tax Abatement Committee (as defined in our current Tax Abatement Policy). ESTIMATED SCHEDULE OF PROJECT If approved, Council will be asked to appoint the nominating committee at this meeting. The nominating committee will be charged with submitting and receiving nominations from the Council and Chamber Board, contacting nominees to determine willingness to serve, and developing a slate of nominees for City Council approval at the September 16, 2003 Council meeting. PRIOR ACTION/REVIEW N/A FISCAL INFORMATION N/A EXHIBITS Ordinance Respectfully submitted: Linda Ratliff, Director Economic Development Department ORDINANCE NO. AN ORDINANCE OF THE CITY OF DENTON, TEXAS ESTABLISHING AN ECONOMIC DEVELOPMENT PARTNERSHIP BOARD; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council of City of Denton, Texas has determined that it is beneficial and in the public interest to establish an Economic Development Partnership Board to provide economic development policy guidance for the City; NOW, THEREFORE; THE COUNCIL OF THE CITY OF DENTON, TEXAS HERBY ORDAINS: SECTION 1. Findings. The findings contained in the preamble of this ordinance are incorporated into the body of this OrdNance. SECTION 2. The Code of Ordinances of the City of Denton is hereby amended to add Article IX of Chapter 2 to read as follows: ARTICLE IX. ECONOMIC DEVELOPMENT PARTNERSHIP BOARD Sec. 2-251. Creation, Members, Qualifications, and Tenure. A. There is hereby created a City of Denton board entitled the Denton Economic Development Partnership Board (the "Board"). The Board shall consist of seven members. The board members shall be appointed for two-year terms except that four members shall only serve a one-year term for their first term. Thereafter, four members shall be appointed for a two-year term in the even numbered years and three members shall be appointed for a two-year term in the odd numbered years. No member shall serve more than three consecutive terms except for the President of the University of North Texas ("UNT"), or his designee, who may serve unlimited terms. B. The Board members shall be appointed by the City Council and shall serve at the City Council's pleasure. To aid the City Council in making appointments to the Board the City Council will appoint two City Council members and one Chamber of Commerce ("Chamber') member to act as a nominating committee (the "Committee"). The Committee members are qualified for appointment to the Board. The City Manager and President of the Chamber will serve as ad hoc non-voting members of the Committee. The Committee will solicit nominations, contact nominees to relate duties and responsibilities and to confirm willingness to serve. The Board will solicit recommendations from the Chamber Board of Directors and the President of UNT. After evaluating the recommended nominees the Committee will present to the City Council a slate of Board nominees for City Council approval. C. Notwithstanding anything contained herein to the contrary the membership make-up of the Board shall consist of the following Two members of the Board shall be City Council members at the time of their appointment to their original tenn. They may serve out all three terms, even if they are no longer members of the City Council after the original appointment as long as they continuously serve throughout the three terms. They must be residents of the City of Denton. Two members of the Board shall be members of the Chamber Board of Directors ("Chamber Board") at the time of their appointment to their original term. They may serve out all three terms, even if they are no longer members of the Chamber Board after the original appointment as long as they continuously serve throughout the three terms. They must reside or work in the City of Denton. The Chamber Board will recommend the two nominees for consideration by the Committee and approval by the City Council. Two members wilt be, or be employed by, a top twenty City of Denton ad valorem or sales tax payer. Such members must reside or work in the City of Denton. One member will be the President of UNT or a UNT faculty or staff member designated by the President. Such member need not reside in the City of Denton and is not restricted to the three term limits. However, such member must be appointed by the City Council for each term. D. The Board shall elect its chairperson and vice-chairperson f~om among its members who shall serve for one-year terms or until his or her successor is elected or qualified. The Board may remove and re-elect a chairperson or vice-chairperson at anytime with an affirmative vote of at least five members. E. The Denton City Manager and the Chamber President shall be ex-officio members of the Board. F. Board members shall serve without compensation. Board members may be allowed out-of-pocket expenses for activities performed in furtherance of their duties to the Board. Such expenses must be pre-approved by the City Manager if paid for out of City fimds, or the Chamber President if paid for out of Chamber funds. Page 2 S:\Our Documents\Ordinances\03\EDP Ordinance. doc Sec. 2-252. Meetings. The Board shall meet on a regular basis and no less than on a quarterly basis. Monthly meetings are encouraged. The chairperson, vice-chairperson or any three Board members may call any regular or special meeting. Notice of the meetings shall be posted and conducted in accordance with the Texas Open Meetings law, being Chapter 551 of the Government Code, as amended. A majority of the qualified voting members of the Board shall constitute a quorum for the transaction of business at any meeting of the Board. The act of a majority of the qualified voting members of the Board present at a meeting at which a quorum is present shall be the act of the Board. Sec. 2-253. Rules of Procedure. The Board shall adopt rules of procedure governing the operation of the Board incorporating Sections 2, 3, 5, and 7 of City Council Rules of Procedure insofar as it is possible. Sec. 2-254. Duties and Responsibilities of the Board. The role of the Board is to provide economic development policy guidance. The Board may make recommendations to the City Council and Chamber. The Boards duties include: The Board will implement Denton's Economic Development Action Plan which includes the implementation of specific projects. The Board may create committees or task forces consisting of Board members and/or non- Board members to assist with the implementation of projects or activities. Committee task force chairpersons shall be appointed by the Board and will serve at the pleasure of the Board. The Board will be responsible for designing economic development incentive policies and recommending those policies to the City Council for adoption. These policies may include tax abatement, Chapter 380 agreements, infrastructure assistance, etc. In making any recommendations the Board shall comply with applicable law. It will be the Board's responsibility to review policies of other cities and to be informed as to legislative changes affecting state and local incentive programs. Co The Board shall act as the recommending body to the City Council for specific project economic development incentives authorized by law, including without limitation tax abatements and incentives authorized under Chapter 312 of the Tax Code, economic development agreements authorized under Chapter 380 of the Local Government Code, and public improvement districts authorized under Chapter 372 of the Local Page 3 S:\Our Documents\Ordinances\03XEDP Ordinance.doc Government Code. However, utility incentives based on thresholds, such as the Electric Utility Industrial Development Rider and the Water/Wastewater Plan Line Extension may be made without Board review or recommendation. Nothing herein shall be construed so as to invalidate an economic development incentive authorized by the City Council or Chamber that did not receive a recommendation fi:om the Board. Do The Board will review and recommend both the City and Chamber annual. economic development budgets. These recommendations will be made to the City Manager and Chamber President for inclusion in the overall City and Chamber budgets. The Board will review and recommend the annual work plans for the City and Chamber economic development programs. Work plans must be consistent with the annual budgets. SECTION 3. This ordinance supercedes any provision in any City ordinance that is conflict with this ordinance including without limitation Section 2-61 of the Code of Ordinances of the City of Denton. SECTION 4. The Economic Development Parmership Board replaces the Joint Committee on Tax Abatement (the "Joint Committee") and shall exercise all of the rights and duties of the Joint Committee. The Joint Committee is hereby dissolved to be effective from and after the appointment of the Board members, and they are qualified to serve (the "Effective Date"). This shall not effect the validity of any action taken by the Joint Committee prior to the Effective Date. SECTION 5. passage and approval. This ordinance shall become effective immediately upon its PASSED AND APPROVED this the __day of ,2003. ATTEST: JENNIFER WALTERS, CITY SECRETARY BY: APPROVED AS TO LEGAL FORM: BY: '~"~-~ / ( /~ Page 4 EULINE BROCK, MAYOR S:\Our Documenta\Ordimmces\03\EDP Ordinance.doc AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: ACM: August 19, 2003 Economic Development Mike Conduff, City Manager SUBJECT CONSIDER APPOINTMENT OF TWO CITY COUNCIL MEMBERS AND ONE DENTON CHAMBER OF COMMERCE BOARD MEMBER TO THE ECONOMIC DEVELOPMENT PARTNERSHIP BOARD NOMINATING COMMITTEE. BACKGROUND Individuals who serve on the Economic Development Partnership (EDP) Board are selected from defined categories as outlined in the ordinance. The nominating committee, comprised of two City Council members and one Chamber of Commerce Board member, will be charged with receiving nominations from the Council and Chamber Board, contacting nominees to determine willingness to serve, and developing a slate of nominees for City Council approval at the September 16, 2003 Council meeting. ESTIMATED SCHEDULE OF PROJECT The nominating committee will provide a slate of EDP Board members at the September 16, 2003 City Council meeting so that the Board may begin meeting October 1, 2003. PRIOR ACTION/REVIEW N/A FISCAL INFORMATION N/A EXHIBITS N/A Respectfully submitted: Linda Ratliff, Director Economic Development Department AGENDA INFORMATION SHEET AGENDA DATE: DEPARTMENT: CM: August 19, 2003 City Manager's Office Mike Conduff, City Manager SUBJECT Consider nominations and appointments to the City's Boards and Commissions. BACKGROUND Council Member Redmon has nominations to the Community Development Advisory Committee, the Library Board and the Parks, Recreation and Beautification Board. These nominations will complete the annual nomination/appointment process. Council may wish to suspend the rules and vote on any nominations made at this meeting. If you require any further information, please let me know. Respectfully submitted: Jennifer Walters City Secretary