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07/09/2008 - Minutes Intergovernmental Wafer Board (MIB) Meeting Minutes July 9, 2008 Tigard Public Works Building 8777 SW Burnham Street Tigard, OR 97223 Members Present: Gretchen Buehner Representing the City of Tigard Patrick Carroll Representing the City of Durham Julie Russell Representing the Tigard Water District (Arrived 5:35 p.m.) Bill Scheiderich Member At-Large (Arrived 6:15 p.m.) Dick Winn Representing the City of King City Members Absent: None Staff Present: Public Works Director Dennis Koellermeier Water Quality & Supply Supervisor John Goodrich IWB Recorder Greer Gaston Note:Agenda items are recorded in the minutes in the order they were considered This order varies from the agenda, thus the discrepancy in numbering. 1. Call to Order, Roll Call and Introductions Commissioner Carroll called the meeting to order at 5:33 p.m. 2. Approval of Minutes --June 11, 2008 Commissioner Buehner motioned to approve the June 11, 2008 minutes; Commissioner Winn seconded the motion. The minutes were approved by unanimous vote of the Commissioners present, with Commissioners Buehner, Carroll, and Winn voting yes. 3. Public Comments: None 8. Non-agenda Items Commissioner Buehner presented two non-agenda items. She distributed correspondence between Tigard City Manager Craig Prosser, Tigard Water District (TWD) Chair Ken Henschel, and herself regarding consideration of the Tigard/Lake Oswego water partnership intergovernmental agreement (IGA). The correspondence is on file in the IWB record. Note: Commissioner Russell arrived at 5:35 p.m. Intergovernmental water Board Minutes July 9,2048 Commissioner Buehner expressed concern that Mr. Henschel said he did not understand how the process of considering the IGA worked. She suggested he should be aware of the procedure since he had participated in previous meetings where the same process had been followed. Commissioner Buehner mentioned Mr. Prosser attended the TWD's Monday night meeting, waited quite some time while the TWD was in executive session, and ultimately went home. Commissioner Buehner said she had informed Mr. Henschel that Mr. Prosser would be in attendance. Commissioner Russell replied the TWD was not aware of Mr. Prosser's presence until the TWD came out of executive session. Commissioner Buehner's second non-agenda item related to a legal opinion prepared by the City of Tigard's attorney. Commissioner Buehner summarized the opinion. With regard to which member jurisdiction(s) should sign the water partnership intergovernmental agreement, the attorney advised the City of Tigard is the appropriate entity to execute the agreement since the agreement involves real property outside the original district. She continued by saying ownership interest needed to be tied to the bondable entity; no credible bonding agency would issue bonds where there's ownership by a jurisdiction that is not able to be bonded. The Board briefly discussed whether the TWD and the Cities of Durham and King City could be bonded. Commissioner Russell said the TWD has bonding authority. Commissioner Buehner questioned this statement and suggested bond counsel should be consulted. 4. Public Hearing - Consider a Resolution Recommending the City of Tigard Approve the Water Partnership Intergovernmental Agreement (IGA) Regarding Water Supply Facilities, Design, Construction, and Operation, Between the City of Tigard and the City of Lake Oswego a. Open Public Hearing Commissioner Carroll opened the public hearing. b. Summation by Public Works Department Mr. Koellermeier said the City of Tigard staff recommendation was for the IWB to execute Resolution 08-01 and for the IWB member jurisdictions to execute their respective resolutions in support of the water partnership IGA. Mr. Koellermeier summarized documents related to the agreement. The Board discussed: • Providing the rate comparison data to member jurisdictions. ■ How the existing Portland water contract will work in conjunction with bringing the Tigard/Lake Oswego water source online. ■ How the bonding process might work. Bonds will likely be issued as the money is needed. The City of Tigard will seek the advice of bond counsel to determine the best financing strategy. ■ All components in the water system will be built to accommodate 32 million gallons of water per day (mgd) and critical components will be built to 38 mgd. ■ Current water rate increases of seven percent annually may be sufficient to cover the cost/bonds for the next two years. There will be a rate package associated with the bonds. • The fact that Tigard would still be purchasing water from Portland while also financing the water partnership project. Once the water partnership projects are completed and Tigard's water source switches to Lake Intergovernmental Water Board Minutes July 9,2008 2 Oswego, Tigard will be begin paying operation and maintenance costs. However, the City will no longer need to purchase water from Portland. Operation and maintenance costs are expected to be less than the cost of purchasing water from Portland. A water conservation management plan related to Lake Oswego's water rights and conservation pricing will be required by the state. Note: Commissioner Scheiderich arrived at 6:95 p.m. ■ The sale of surplus water in Article 11. The water partnership provides for the right to sell surplus water. Each partner has the right of first refusal to purchase surplus water from the other. The partnership can also sell excess water to other entities. The details of an outside a sale were discussed. • The methodology used in Exhibit 7, Allocation of System Improvement Costs to Parties. c. Public Testimony Phil Decker, 14540 SW 1481" Place in unincorporated Buil Mountain, said he attended the Tigard Water District (TWD) meeting on Monday night. He reported the TWD discussed ways to "bust, or interfere with, or get some, some leverage" regarding its role in the water partnership. Aside from a few minor details, the TWD's attorney referred to the agreement as well-written and comprehensive. The attorney advised against attempts to derail the agreement. Commissioner Russell countered the TWD had not sought to derail the agreement. She said the TWD had called a special meeting because she was not comfortable, nor did she think state law allowed her to act without a vote of the TWD. She confirmed the TWD's attorney said the agreement was well-written and very comprehensive. Commissioner Russell distributed a list, dated July 9, 2008, of issues and concerns regarding the agreement on behalf of the TWD. This list is on file in the IWB record. She said the TWD had authorized her to move forward with the agreement. e. Close Public Hearing Commissioner Carroll closed the public hearing. d. IWB Discussion Commissioner Russell inquired about member jurisdiction liability and if member jurisdictions were indemnified. Commissioner Scheiderich responded the provider assumes responsibility. Commissioner Russell inquired whether the Tigard City Council would hold hearings on the rate structure. Commissioner Buehner said opportunities for public comment on the rate structure would occur at the IWB and at the City of Tigard's Budget Committee meeting. Mr. Koellermeier said IWB meetings would be the appropriate place to hear public comment on this topic. Commissioner Russell inquired about section 15.1 of the agreement allowing for the agreement to be reviewed three years after initial expansion and for the creation of an intergovernmental "Supply Agency." Commissioner Buehner replied it was simpler to operate under an IGA as opposed to forming an agency. However, at some point it may make sense to create an agency and this section of the agreement leaves the option open. Mr. Koellermeier added operating Intergovernmental Water Board Minutes July 9,2008 3 under an agency now might be awkward since Lake Oswego is using the existing system. Commissioner Buehner said it was a fair agreement which solidifies what was discussed at the joint meeting with Lake Oswego. f. IWB Consideration: Resolution No. 08-01 Commissioner Carroll read the title of Resolution 08-01, A RESOLUTION RECOMMENDING THE CITY OF TIGARD APPROVE THE WATER PARTNERSHIP INTERGOVERNMENTAL AGREEMENT REGARDING WATER SUPPLY FACILITIES, DESIGN, CONSTRUCTION, AND OPERATION, BETWEEN THE CITY OF TIGARD AND THE CITY OF LAKE OSWEGO. Commissioner Winn motioned to approve the resolution; Commissioner Scheiderich seconded the motion. The resolution was approved by unanimous vote, with Commissioners Buehner, Carroll, Russell, Scheiderich and Winn voting yes. Commissioner Russell asked if future agenda items could be scheduled to allow time for the item to go before the TWD prior to IWB consideration. She said the TWD had already passed the sample water partnership resolution provided to member jurisdictions. 6. Water Supply Update Mr. Goodrich reported: ■ 231 million gallons of water are stored in aquifer storage and recovery wells, or 107 days of water at the 15,000 gallons per minute (gpm) rate. ■ Tigard is taking about 1250 gpm from the City's groundwater supply. ■ Current demand is between 9 to 10 million gallons per day, normal for this time of year. ■ The observation well at Tigard High School has been capped, with only a few punch list items remaining. The well on Titan Lane has been properly abandoned. Commissioner Carroll requested the Water Supply Update item be placed earlier on the agenda at future meetings. This way Mr. Goodrich would not have to wait to the end of the meeting to give his report. This agenda item will follow the Public Comments item on future agendas. 5. Discussion on Rewriting/Revising 1993 Intergovernmental Agreements (IGAs) between Durham and the City of Tigard, King City and the City of Tigard, and the Tigard Water District and the City of Tigard - Continued Commissioner Russell said the Tigard Water District's (TWD's) attorney had proposed some possible IGA revisions. Commissioner Buehner said she would like to discuss how the agreement's expiration date might be addressed. Commissioner Carroll proposed various options, and Commissioner Russell suggested making the expiration date similar to language in the Tigard-Lake Oswego water partnership intergovernmental agreement. Mr. Koellermeier said that agreement was perpetual, unless either party decided to withdraw. The Commissioners expressed support for a perpetual agreement. As an alternate perspective, Mr. Koellermeier asked if the member jurisdictions would want to commit to a perpetual agreement given Tigard's self-imposed restriction of not going to the intergovernmental Water Board Minutes July 9,200B 4 Willamette River without voter approval. Commissioner Carroll said he was not concerned about this restriction and noted there was a procedure in place to get out of the IGA if a member jurisdiction chose to do so. Mr. Koellermeier suggested those Commissioners who had not submitted written comments should do so. The comments would be organized and complied for further review. Commissioner Russell said the role of the IWB needs to be more clearly defined. She questioned whether the IWB was a legal entity. Commissioner Carroll advocated for the creation of a single IGA between the City of Tigard and the member jurisdictions (TWD, Durham, and King City). The Commissioners expressed support for this idea. Commissioner Russell pointed out that the existing ICAs differ in terms of extending service outside current boundaries. Commissioner Carroll summarized the following issues to be resolved: ■ Term of the agreement ■ Points of ownership ■ Assets ■ Operate as independent water source so all benefits return to the rate payers ■ Disposition of property Commissioner Russell distributed the Tigard Water District's Review and Initial Comments for Amendment of the Tigard-1W13 Member IGA dated July 9, 2008. This document is on file in the IWB record. 7. Informational Items ■ Regarding the Tigard Water District/City of Tigard lawsuit, Mr. Koellermeier reported the judge ruled in favor of the City. There is a 30-day appeal period. ■ With post tensioning completed, steps to finalize the new reservoir include: - Covering the reservoir with gunite and an asphalt sealer. - Chlorinating and testing. - Backfilling and grading. - Planting the area surrounding and atop the reservoir. 9. Future Agenda Items ■ Presentation by Washington County planning staff regarding Areas 63 and 64. Mr. Koellermeier reported Washington County has not scheduled this yet. ■ Consider making a recommendation on the First Restated Intergovernmental Cooperative Agreement Creating the Willamette River Water Coalition. Mr. Koellermeier reported revisions to this agreement are basically housekeeping issues resulting from the departure of two partners from the group. ■ Policy regarding extension of water services outside existing Tigard Water Service Area boundaries. ■ Review: - Proposed revisions to the credit for leak policy. Mr. Koellermeier said this item was pending. Intergovernmental Water Board Minutes July 9,2008 5 - Proposed revisions to the Billing and Collection of Utility Charges section of the Tigard Municipal Code. The billing insert policy. Commissioner Buehner inquired about the tenancy in common agreements. Mr. Koellermeier said legal descriptions were being prepared. 10. Next Meeting August 13, 2008, 5:30 p.m. Tigard Public Works Building, 8777 SW Burnham Street, Tigard 11.Adjournment At 7.14 p.m. Commissioner Buehner motioned to adjourn the meeting; Commissioner Scheiderich seconded the motion. The meeting was adjourned by unanimous vote, with Commissioners Buehner, Carroll, Russell, Scheiderich and Winn voting yes. IWB Chair Greer A. Gaston, IWB Recorder Date,��ge /y , 02 Al)c9 Intergovernmental Water Board Minutes July 9,2oo8 6