Lake Oswego - Joint Operation as the Lake Oswego-Tigard Water Agency AMENDED AND RESTATED
INTERGOVERNMENTAL COOPERATIVE AGREEMENT
FOR WATER SYSTEM INTERTIE
BETWEEN THE
SOUTH FORK WATER BOARD,THE CITY OF LAKE OSWEGO, THE CITY OF TIGARD
AND THE CITY OF WEST LINN
This Agreement is made and entered into by and between the South Fork Water Board, an
intergovernmental entity created pursuant to ORS Chapter 190, serving as a water supply agency and
jointly owned and operated by the Cities of Oregon City and West Linn, hereinafter referred to as
"Board," and the City of Lake Oswego, an Oregon municipal corporation, hereinafter referred to as "Lake
Oswego" and the City of West Linn, an Oregon municipal corporation, hereinafter referred to as "West
Linn," and the City of Tigard, an Oregon Municipal Corporation, hereinafter referred to as "Tigard," all
hereinafter collectively referred to as the "Parties."
RECITALS
The Parties agree upon the following recitals:
1. The Board, West Linn and Lake Oswego entered into an intergovernmental cooperative
agreement in 1984 to provide for the construction, operation and maintenance of an emergency
water system intertie between the water supply system of the Board and West Linn and the
water supply system of Lake Oswego.
2. The facilities as described in the 1984 agreement, which are located near the intersection of Old
River Road and Kenthorpe Way in West Linn, were constructed and the intertie became
operable in that same year.
3. The intertie has been utilized periodically since 1984 during emergencies and scheduled shut-
downs to provide water supply between the Board,West Linn and Lake Oswego.
4. After the construction of the intertie, West Linn, Lake Oswego and the Board jointly funded, and
West Linn constructed, a pump station on Old River Road near its intersection with Kenthorpe
Way to provide for automatic and unattended operation of the intertie.
S. The intertie, pump station and appurtenant facilities provide benefit to all of the Parties to this
agreement.
6. Lake Oswego and Tigard entered into an intergovernmental cooperative agreement that
conveys an ownership interest in the existing water supply facilities that supply emergency
water to West Linn and Board, and provides for construction of new water supply facilities
including an expanded water treatment plant and raw and finished water pipelines to supply
Lake Oswego and Tigard's long term water needs.
7. The changes in ownership and anticipated facilities expansion called for in the
intergovernmental agreement between Lake Oswego and Tigard necessitate amending the
existing water system intertie agreement and adding Tigard to the agreement.
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8. The Parties desire that this agreement supersede and replace the 2003 agreement.
9. The Parties acknowledge that they have the authority to execute this cooperative
intergovernmental agreement pursuant to the terms of their respective municipal charters and
pursuant to ORS 190.010 et seq.
NOW THEREFORE, in consideration of the mutual covenants and agreements contained herein, it is
agreed by and between the Parties hereto as follow;
1. "Water Supply Facilities" Defined. As used herein,the term "water supply facilities" means river
intake, raw and finished pumping facilities, water treatment facilities, water storage facilities,
and all other infrastructure used in conjunction with the appropriation, treatment, storage or
transmission of the Parties'water.
2. "Emergency Condition" Defined.An "emergency condition" is an occurrence created by a failure
of a Party's water supply facilities, or the occurrence of an event that jeopardizes a Party's water
quality,whereby insufficient supply of water to the Party's customers could threaten the health
or safety of those customers.Such failure includes failure or interruption in the operation of
river intakes,raw and finished water pumping facilities,water treatment facilities, raw and
finished water pipelines, reservoirs, and appurtenant facilities. "Emergency condition"does not
include a situation that involves the loss of water pressure or diminution in water volume in a
water distribution system during periods of high demand if the system remains in a normal
operational mode or a reduction in available water resulting from regulatory action by a state or
federal agency.
3. Use of Water Intertie.
a. Emergency Conditions. Use of the water intertie during an emergency condition may be
accomplished by the mutual consent of the Executive Officer of each Party or the
Executive Officer's designee.
b. Non-Emergency Conditions Cess Than Two Weeks. Temporary use of the intertie for a
period less than two weeks during scheduled maintenance and repair may be
accomplished by the mutual consent of the Executive Officer of each Party or the
Executive Officer's designee.
c. Non-Emergency Conditions Greater Than Two Weeks. Prolonged use of the intertie for
more than two weeks during scheduled maintenance and repair must be approved by
the Executive Officer of each Party.
4. Location and Description of Water System Intertie The water system intertie and pump station
facility is located at 20225 Old River Road. Supply to the pump station from Lake Oswego/
Tigard is from a connection to Lake Oswego's finished water transmission main. The pipeline
connection between Lake Oswego's finished water transmission main and the intertie pump
station is under the exclusive ownership and control of West Linn. The pump station and
related valves and control systems allow the intertie to be used on a continuous and
automatically controlled basis in both directions of supply, i.e. Board/West Linn to Lake
Oswego/Tigard and Lake Oswego/Tigard to West Linn/Board.The pump station includes flow,
pressure control, metering and telemetry facilities,and a connection for providing emergency
power supply.The pump station, along with the facilities and appurtenances associated with it,
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and any modifications thereto, constitute the water system intertie that is the subject of this
agreement.
5. Title to Intertie Facilities.Title to the water system intertie facilities as described above in
Paragraph 4 and the obligation to insure them shall be in the name of West Linn.Title to the
property occupied by the intertie pump station will be in the name of West Linn.
6. Method of Water Supply Through Intertie Supply to Lake Oswego and Tigard from the Board
and West Linn will be by gravity through the piping, metering,flow and pressure control
facilities associated with the intertie pump station.Supply to West Linn and the Board from Lake
Oswego and Tigard will be accomplished by pumping from Lake Oswego's water system through
the intertie pump station into West Linn's system. Instrumentation,control and telemetry
systems in the station are under the primary control of West Linn. Lake Oswego has installed
additional instrumentations, control and telemetry systems that provide for pump station status
indication and additional control functions. West Linn will prepare and update as necessary an
operating plan for the intertie pump station and appurtenant facilities and provide copies of
same to the Board, Lake Oswego and Tigard.
7. Quantity of Water to be Supplied. Upon agreement between the Parties to make use of the
intertie pursuant to Paragraph 3 of this Agreement,the Party supplying water shall endeavor to
supply the amount of water requested by the other Party,and take all reasonable actions
necessary to accomplish the same,so long as such actions are not detrimental to the operation
of the supplying Party's own water system. Provided that Lake Oswego's supply facilities are
expanded to a treatment capacity of 38 million gallons per day(mgd), Lake Oswego and Tigard
can provide West Linn and Board with up to 4 mgd through at least 2041.
8. Cost of Water to be Supplied.The Parties agree to pay for all water provided through the
intertie at a rate that is the greater of:
a. The rate being paid by West Linn to South Fork for wholesale water;or
b. The cost to Lake Oswego and Tigard to produce and deliver water to the inlet side of the
intertie pump station,which in the first year of operation of the expanded treatment
plant is estimated to be$0.95 per 100 cubic feet.
The volume of water delivered shall be measured by the meter installed at the intertie pump
station.The Parties have the right at any time to review rates for water supplied and make such
adjustments to the cost of water provided, as they deem necessary and by mutual agreement of
all Parties. In the event it is necessary for the Party supplying water through the intertie to
obtain additional water from a water provider that is not a party to this agreement, the water
rate charged to the Party receiving water under this agreement shall be the water rate charged
to the supplying Party by the non-party water provider.The Parties further agree that water
utilized for periodic testing and exercising of the facilities will be furnished between the Parties
without cost. In addition to the rate charged for water, the Parties by mutual agreement reserve
the right to impose wheeling charges.
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9. Operation and Maintenance Costs Lake Oswego and Tigard agree to supply the water used to
exercise the intertie pumps at a rate of approximately 500 gallons per minute for one hour each
week at no cost to West Linn or the Board. The Parties agree that West Linn, as the owner of
the intertie facilities, is responsible for all other costs of the normal day-to-day operation and
maintenance of the facilities.
10. Repairs, Renewals, Replacements Upgrading and Modifications The Parties agree that West
Linn,as the owner of the intertie facilities, will be responsible for scheduling, contracting for and
implementing any repairs, renewals, replacements, upgrading and modifications that may be
required in the future to maintain or increase the function of the facilities.
a. Cost of Repairs. West Linn shall be responsible for the cost of all repairs,except that
Lake Oswego and Tigard agree to pay 50%of the cost of any repairs necessary to those
facilities that benefit Lake Oswego and Tigard.Those facilities are defined as the piping,
valves,vaults, metering, instrumentation and control systems, and appurtenant facilities
that are used to provide water to Lake Oswego and Tigard from West Linn and the
Board.
b. Cost of Capital Improvements. The cost of any capital improvements or improvements
that increase the function of the facilities will be shared in an equitable manner, based
upon the benefit to be derived from each Party from each particular period.
11. Access to Water System Intertie Facilities The Parties and their employees shall have access to
the water system intertie facilities.
12. Agreement Not to Resell Water Without Consent Except for existing wholesale customers or
mutual aid agreements, the Parties agree that they will not resell water supplied under the
terms of this agreement without prior written consent of all Parties.
13. Supersedes Prior Agreement. The Parties agree that this agreement supersedes and replaces
the prior agreement executed in October(Lake Oswego), November(Board) and December
(West Linn), 2003.
14. Amendment Provisions. The terms of this agreement may be amended by mutual agreement of
the Parties.Any amendments shall be in writing,shall refer specifically to this agreement, and
shall be executed by the Parties.
15. Termination of Agreement.This agreement shall remain in perpetuity until such time as it is
terminated by the mutual written consent of all Parties. Termination of this agreement shall not
affect ownership status of the water system intertie facilities hereinabove described.
16. Written Notices.All written notices required under this agreement shall be sent to:
South Fork Water Board: General Manager
South Fork Water Board
15962 S. Hunter Avenue
Oregon City,Oregon 97045
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City of Lake Oswego: City Manager
City of Lake Oswego
P.O. Box 369
Lake Oswego, Oregon 97034
City of Tigard City Manager
13125 SW Hall Blvd
Tigard,Oregon 97223
City of West Linn: City Manager
City of West Linn
22500 Salamo Road
West Linn, Oregon 97068
17. Dispute Resolution: If a dispute arises between the Parties regarding this Agreement, the
Parties shall attempt to resolve the dispute through the following steps:
Step One (Negotiation)
The Executive Officer or other persons designated by each of the disputing Parties will negotiate
on behalf of the entity they represent.The nature of the dispute shall be reduced to writing and
shall be presented to each Executive Officer,who shall then meet and attempt to resolve the
issue. If the dispute is resolved at this step,there shall be a written determination of such
resolution, signed by each Executive Officer and ratified by their respective Board or Council,
which shall then be binding upon the Parties.
Step Two(Mediation)
If the dispute cannot be resolved within thirty(30)days at Step One,the parties shall submit the
matter to non-binding mediation.The Parties shall attempt to agree on a mediator. If they
cannot agree,the Parties shall request a list of five (5)mediators from the Presiding Judge of the
Clackamas County Circuit Court.The Parties will attempt to mutually agree on a mediator from
the list provided, but if they cannot agree,the mediator will be selected by the Presiding Judge
of Clackamas County Circuit Court. The cost of the mediator shall be borne equally between the
Parties, but each Party shall otherwise be responsible for its own costs and fees. If the issue is
resolved at this step,a written determination of such resolution shall be signed by each
Executive Officer and ratified by their respective Board or Council.
Step Three (Arbitration)
If the Parties are unsuccessful at Steps One and Two,the dispute shall be resolved by binding
arbitration proceedings pursuant to ORS Chapter 36. The Parties shall follow the same process
as in Step Two for the selection of the arbitrator. Upon breach of this agreement,the
nondefaulting Parties shall be entitled to all legal or equitable remedies available, including
injunctive relief, declaratory judgment,specific performance and termination. Each party shall
be responsible for its own attorney fees and costs.
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IN WITNESS WHEREOF,the Parties have set their hands and affixed their seals as of the date and
year hereinabove written.
Board has acted in this matter pursuant to Resolution No. adopted on the cL%
day of N��ebsr, 2013, or by any other acceptable means.
Lake Oswego has acted in this matter pursuant to Resolution No./3VLOI adopted on the !16
day of , 2013,or by any other acceptable means.
West Linn has acted in this matter pursuant to Resolution No. adopted on the 15'"
day of 2013,or by any other acceptable means.
Tigard has acted in this matter pursuant to Resolution No./4/•O adopted on the �� --
day of 2-643, or by any other acceptable means.
JJ
South Fork Water Board,
by and t ough its offi ' Is APPROVE 0 FOR
By: By: A r �
Dou eeley Vic C air Chri rean,Attorney
City of Lake Oswego, APPROVED AS TO F
by and through its o i ials
By: .�L ' By:
Kent Studebaker, Mayor David Powell,City Attorney
Attest:
Catherine Schneid ty Recorder
City of West Linn, APPROVED AS TO FORM
by and hrough its officials
Joan , istaoa ' MegThorn Assistant City A;torrey sh, of
Attest:
Kathy Mollusky,eity Recorder
City of Tigard APPROVED AS TO FORM
by an hr g 't icials
By: 13,—
L)
John L. ok, Mayor amis,Atior6y
IV
Attest
Cathy heatley, ity Recorder '
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6wc, ''ems , Ia I ►31gy
INTERGOVERNMENTAL
COOPERATION AGREEMENT
BETWEEN THE CITY OF LAKE OSWEGO AND THE CITY OF TIGARD
AUTHORIZING JOINT OPERATION AS THE LAKE OSWEGO-TIGARD
WATER AGENCY.
This Agreement is made. and entered into by and between the City of Lake Oswego ("Lake
Oswego") and the City of Tigard("Tigard")(jointly referred to herein as the "Member Utilities").
RECITALS:
A. The Member Utilities desire to enter into this Intergovernmental Cooperation Agreement
(the "Agreement") to provide for the.creation of an intergovernmental entity to be known as the Lake
Oswego-Tigard Water Agency("Agency") and to provide terms for the purchase of an interest by Tigard in
certain existing water facilities of Lake Oswego.
B. Lake Oswego and Tigard acknowledge each has the authority to execute this cooperative
intergovernmental:agreement pursuant to the powers of each of the Cities respective municipal charters and
pursuant to ORS 225.050 and ORS 190.010.
C. Tigard presently provides water service to its residents and also pursuant -to separate
intergovernmental cooperation agreement, water service to the citizens of the cities of Durham, King City
and the Tigard Water District(jointly referred to herein as "Other Utilities").
D. The member utilities have authorized creation of the intergovernmental entity described
herein. The ordinances authorizing such creation are attached hereto as Exhibit A.
NOW, THEREFORE, the premises being in general as stated in the foregoing recitals, it is agreed
by and between the Member Utilities hereto as follows:
1. Establishment and Duration. Pursuant to ORS Chapter 190, an intergovernmental
entity to be known as the Lake Oswego-Tigard Water Agency ("Agency") is hereby established in
accordance with the terms of this Agreement. The term of this Agreement shall be perpetual unless
terminated pursuant to Section 33 hereof.
2. Declaration of Public Purpose, This Agreement is entered into by the Member.
Utilities pursuant to ORS Chapter.190 to provide for the formation of the Agency and the cooperation in
the management, acquisition and operation and,maintenance of pumping stations, treatment plants and
certain transmission piping and storage reservoirs for the purpose of supplying water to the member utilities
and present and future wholesale customers. It is also intended that the Agency shall have the power to
issue tax exempt revenue bonds payable solely from revenues received from Member Utilities and the Other
Utilities specified herein.
Page 1. Intergovernmental Cooperation Agreement .
3. Dom. Words, terms and phrases which are not specifically defined in this
Agreement shall have the ordinary meaning ascribed to them in the municipal utility context unless the
context clearly indicates ,otherwise. When not inconsistent with the context, words used in the,plural
number include the singular'and words in the singular include the plural. The word "shall" is mandatory
and not merely directory: Unless the context clearly indicates otherwise, the following words, terms and
phrases shall mean:
"Agency"means the Lake Oswego-Tigard Water Agency.
"Agreement means this Intergovernmental Cooperation Agreement entered into by the
Member Utilities.
"Board" means the Board of Directors of the Lake Oswego-Tigard Water Agency appointed
pursuant to Section 5 hereof.
"Member Utilities" means Lake Oswego and Tigard
"Other Utilities" means Durham,King City and the Tigard Water District.
"Effective Date"means the date upon which the signatory's to this agreement have
signed their names.
"Implementation Date"means the date upon which Agency facilities,necessary to
supply,treat and transmit up to 50 cfs of water,are operational.
"the System"means those certain pumping,water treatment,transmission piping and
storage and metering facilities owned by the Agency and operated and maintained for
the purpose of supplying water to the member utilities.
"Depreciation Cost" means the.revenue requirement necessary to provide for the replacement
of the depreciable-components of the System
4. Powers. Agency shall have the following powers:
(a) To establish a Board for the acquisition, construction, operation, management and
control of matters referred to herein;
(b) To adopt bylaws to govern its internal operation and management;
(c) To issue, sell or otherwise dispose of bonds, securities, or other forms of
indebtedness for the purpose of carrying out any of the matters permitted by these powers and to finance all
costs of issuance related thereto;and
Page 2. Intergovernmental Cooperation Agreement
(d) To perform pursuant to ORS 190.003 to ORS 190.250 (the "Act") all powers
pursuant to the Act, applicable charters, ordinances, and state or federal laws, which are necessary to
efficiently operate; maintain and expand its water facilities and projects including the power to issue
revenue'bonds under ORS 288.805 to 288.945.
(e) To perform .pursuant:.to ORS 190.00 - 190.250 all powers including rate making
pursuant to applicable charter,ordinance or state or federal laws, which are necessary to efficiently operate,
maintain and expand water related facilities.
5. Board Membership. The Board shall consist of three City Councilors from Lake Oswego
and two City Councilors from Tigard. The Lake Oswego board representatives shall be made by the Lake
Oswego City Council and the Tigard board representatives shall be made by the Tigard City Council. The
composition of the Board shall not be affected by the respective water consumption of the Member
Utilities.
6. Terms of Office. Upon, the execution of this Agreement, Lake Oswego and
Tigard shall appoint their respective Board Members. The initial term of one Lake Oswego and one Tigard
Board Member shall expire January 1, 1997. The initial terms of two Lake Oswego Board Members and
one Tigard Board Member shall expire January 4, 1999. Thereafter, all new Board Member.positions shall.
be for a term of four years. Board Members may be re-appointed to succeeding terms. Board Members
may be replaced at will by the respective City Councils.
7. Vacancies and Substitutions. Both Lake Oswego and Tigard shall have unilateral
authority to fill a vacancy or substitute another person for membership on the Board. Any person appointed
to fill a vacancy shall serve for the remainder of the unexpired term. Any person appointed pursuant to this
Section 7 may be appointed for a regular term pursuant to Section 6 hereof.
8. Chair and Vice Chair. At the first meeting of the Board, the Board shallelect.a Chair
and Vice Chair to serve until January 1, 1997. Thereafter, a Chair and Vice Chair shall be elected for a
terms of two (2) years. For all subsequent two (2) year terms, the positions of Chair and Vice Chair shall
alternate between Lake Oswego.and Tigard.
9. Conflict of Interest. Board members shall be public officials subject to the
provisions of ORS Chapter 244. No person shall serve as a member of the Board if a business with which
that person is associated,as defined in ORS 244.020(2),has any interest in the activities of the Agency.
10. Meetings. Regular meetings of the Board shall be conducted at such times as the
Board may designate, The Chair upon his or her own motion,may,or at the request of two (2) members of
the Board, shall, by giving notice to members of the Board, call a previously-unannounced special meeting
of the Board for a time not earlier than twenty-four (24) hours after the notice is given, unless an
emergency exists. In cases of an emergency,notice reasonable under the circumstances shall be given. No
action will betaken by the Board unless a majorityof the Board approves such action.
11. Manager and Secretary. The Lake Oswego City Manager or designee shall
serve as Manager of the Agency. The Secretary shall be the Tigard City Administrator or designee.
Compensation, if any, for Lake Oswego City Manager and Tigard City Administrator services to the
Page 3. Intergovernmental Cooperation Agreement
Agency shall be determined by the Agency. The Manager shall,(1) be the chief budget and fiscal officer of
Board, (2) be the chief purchasing and business agent of Board, (3) prepare and submit to the Board
financial activity reports to the Board',and`prepares such other reports andinformation as the Board may
require. The Secretary shallbe responsible for the Board's records and shall keep a record of all Board
proceedings.
12. DesgfWtion of Physical Assets. The present market value of real..property and
improvements thereon,and the present depreciated replacement value of physical assets and other pertinent
information related thereto as set forth in the attached Exhibit 'B" constitute the System under the terms of
this agreement and are hereby contributed to the Agency by Lake Oswego as of the effective date of this
agreement.
13. Debts of the Agogy. No bonded debt of the Lake Oswego-Tigard Water Agency
shall be incurred without approval of the Board
14. Ogeradon and Maintenance(O&Ml Cost Allocations. O & M costs include
costs for operation and maintenance of the System described in Exhibit "B". O&M costs will be allocated
between the member utilities using the base-extra capacity method (Water Rates, American Water Works
Association, Manual Ml, 1991) which allocates O & M cost components to base and maximum day
categories. The methodology for O & M cost allocations are reflected in the tables attached hereto as
Exhibit"C" attached and incorporated hereinby this reference.
15. Allocation of Raw Water. Upon execution of this agreement, Lake Oswego shall .
be authorized to appropriate raw water, subject to the permits enumerated below, as required for efficient
operation of the System and to assure a continuous and adequate supply of treated water to meet the needs
of the Agency. Lake Oswego's right to treated water from the System shall, under the permits set forth
above, be senior to the rights of Tigard to such treated water. No member utility shall have the right to
treated water from the System in excess of the allocations identified below, except pursuant to paragraph
15.2
Permit NumbeMource Lake Oswego
P-32410\Clackamas K
P-37839VClackamas R.
P-43246\Willamette R
Total Allocated 35.6(23.0 MGD) 29.4 cfs (19.0 MGD)
15.1 Water Production. On or after the implementation date, each member
utility shall have the right to call upon the System'for the treatment of raw water up to that portion of the
then existing hydraulic capacity' of the System as shall be less than or equal to the requesting utilities
allocation of the System pursuant to paragraph 16. Subject to the provisions of paragraph 15.2,1 any
member utility may utilize the System for the treatment of raw water in excess of its allocation to the extent
of any unused hydraulic capacity.
Page 4. Intergovernmental Cooperation Agreement
15.2 msnmag ionate Use of Treated Water. If, during the term of this
agreement, a member utility consumes treated water in excess of its allocated share, said member utility.
shall compensate the contributing utility for the excess treated water so consumed The amount of
compensation shall be determined by multiplying the percentage of excess use made of the System by the
member utility bythe sum of. 1) the agreed upon value of the then existing System, and 2) the
undepreciated, unamortized:costs of any expansion or improvements of the System theretofore authorized
by the Agency. The product so-determined shall be multiplied by an interest factor of,_% per year (based
upon a 365-day year) during the period of disproportionate use. The product of the calculation shall be the
amount of compensation paid.to the member utility contributing the portion of its allocation of the System's
hydraulic capacity. For the purposes of this paragraph, "excess" use of treated water shall mean use in
which a member utility exceeds its allocation of the System's hydraulic capacity during any month of any
calendar year.
16. Ownership Allocation of the System. Ownership in the existing and future system
shall be allocated between Lake Oswego and Tigard based upon the ratio of the respective estimated peak
day water demands to the total peak-day Agency demand estimated for the year 2040. Total Agency
demand is estimated to be 42 MGD. Therefore, Lake Oswego's share of the existing and future System
shall be 23/42nds and Tigard's share shall be 19/42nds of the total system capacity.
17. Ijigard Buy In.
18. Physical Asset Mustment.
19. Future Improvements and Major Repairs.
20. Water Rights. Lake Oswego presently has several permits to appropriate the waters
of the State of Oregon for Municipal use. The City is permitted to appropriate"up to 59 cubic feet per
second(cfs)from the Clackamas River,6:0 cfs from the WfilametteL River, and 2.54.cfs from ground water.
The City also has an application pending to appropriate up to an additional 60 cfs from the Willamette
River. These water permits and pending application are summarized in Exhibit 'B" attached hereto and
incorporated herein by this reference.. These existing permits and pending application are held in the name
of Lake Oswego and no portion of these existing permits and pending application shall be transferred to the
Agency.
22. Existing Wholesale Customers. The member utilities shall be permitted to sell
treated water to their respective wholesale customers which have been established prior to the effective date
of this agreement and such sales shall not be subject to the terms of this section and shall be considered as
part of the water diverted into the separate systems of each member utility. A list of the existing wholesale
customers of each member utility is,attached,hereto as Exhibit"D", (To Follow). Any sales of treated water
to wholesale customers not listed in Exhibit "D" must be approved by the Agency. No. agreement or
understanding with'the customers listed in Exhibit "D" ,may be modified to increase the number of units
served or the volume of water committed or to alter the priority of service,without prior Agency approval.
23. Purchases of Treated Water. Each member utility shall be obligated to purchase treated
water from the Agency up to the then existing hydraulic capacity of the System prior to the purchase of
Page 5. Intergovernmental Cooperation Agreement
treated water from other sources. Said obligation shall commence on the implementation date defined
herein.
24. Water Management and Conservation Plans. The member utilities agree that a Water
Management and Conservation Plan is necessary and is a priority and that such a plan will be developed by
each member_ utility and presented,to the Board for adoption. The member utilities agree to exercise due
diligence in preparing such plans and to prepare, said plans in accordance with the guidelines of Oregon
Administrative Rules (OAR) Chapter 690, Division 86. Pursuant,to adoption by the Board, said plans will
be presented to the Water Resources Department for comment. Such Water Management and Conservation
Plans shall be incorporated into this agreement by reference.
25. Curtailment of Water Supply. The member utilities agree that at such times as
supplies of raw or treated water are insufficient m meet the water demands of the member utilities, each
member utility shall impose water management and conservation plans heretofore described and as adopted
by the Agency. In extreme cases of waxer supply deficiencies, the Board shall, in a timely manner, hold a
special meeting to determine what additional water curtailment measures will be imposed and on what basis
water will be allocated to the respective member utilities.
26. EMC=ncy Water Sales. The member utilities agree that water system interties
with other water providers are a critical component of their respective distribution systems.. The member
utilities further agree that water sold through these interties for emergency purposes shall take precedence
over water sold for its own customers and wholesale customers except that such emergency sales shall not
result in the creation of emergency conditions.for the member utility. Costs of water sold through each
member utilities respective system interties shall be at the unit cost established in existing
intergovernmental cooperation agreements in force as of the effective date of this agreement.
27. Water Sales During the Implementation Period. _ Pursuant to the effective.date of
this Agreement and prior to the implementation date, Lake Oswego 3agrees to sell water in excess of Lake
Oswego's water demands to the City of Tigard at the unit cost established in their current water sales
agreement.
28. Periodic Review of Intergovernmental Agm=n - Following creation of the Board,
it shall be established by a majority vote of the Board, that a periodic review of this Agreement will be
performed. Board will-determine the frequency of such a review and may amend said Agreement pursuant
to Section 4(b),herein.
29. Local Contract Review Board, The Local Contract Review Board of the
Agency shall be the Agency's Board.
30. Contracting for Services. The Agency shall contract with the City of Lake
Oswego to perform such duties required of the Agency by this Agreement.
31. Expenditures._ No funds of the Agency shall be expended except upon the vote of the
Board and in furtherance of the purposes of the Board; except that expenditures within the limitations of the
Board approved budget may be made by the Manager. Additional authorized signatures shall include the
Page 6. Intergovernmental Cooperation Agreement
Chair or Vice Chair, in the event the Manager is unable to perform. The Board shall institute by-laws to
assure compliance with Local Budget Law.
32. Amendment Provisions. The terms of this Agreement may be amended for any
purpose including, without limitation, the addition or deletion of Member Utilities. Any such amendment
shall be in writing and shall refer specifically to-this Agreement and shall be adopted by all the governing
bodies of the Member Utilities.
33. Termination and Dissolution: This Agreement may be terminated upon ten;(10) years
advance written notice by a vote of the governing boards of the member utilities. Upon approval of
termination by the Member Utilities, the Chair of the Board shall direct that an accounting of assets and
liabilities be conducted and presented to the Board and to the governing bodies of the respective Member
Utilities. The Member Utilities shall thereafter meet and agree upon an equitable distribution of any assets
and liabilities, which may include a reserve account for contingent, unliquidated or unforeseen liabilities or
obligations. If the Member Utilities are unable to agree to the division of assets and liabilities, the Circuit
Court of Clackamas County shall have jurisdiction to decide the issue. Tigard has separate
intergovernmental agreements with the Other Utilities and under the terms of those other agreements the
Other Utilities could withdraw from their present relationship with Tigard. In no event shall such a
withdrawal by one or more of.the Other Utilities,from their relationship with Tigard constitute an act of
termination or dissolution of this Agreement.
34. . Pub is Rec.^:+dLS and Meetings. The Agency shall comply with all applicable
requirements of ORS Chapter 192 concerning public records and public meetings.
35. �'=M1?encation.E=nses. The members of the Board shall receive no
compensation for services provided as Board members except for reimbursement of actual and necessary
travel and other expenses incurred in the performance of their duties, unless approved otherwise by the
Agency.
36. Effective Date. This Agreement will be effective legally upon this execution
by the last Member Utility signing this agreement.
37. Written Notice Addresses. All written notices required under this Agreement shall
be sent to:
City of Lake Oswego City of Tigard
City Manager City Administrator
PO Box 369 13125 SW Hall Blvd.
Lake Oswego, OR 97034 Tigard,OR 97223
38. Severability. If any provision of this Agreement shall be held to be invalid, illegal
or unenforceable, such invalidity,illegality or unenforceability shall not affect any other provisions of this
Agreement,but this Agreement shall be construed as if such.invalid, illegal or unenforceable provisions had
never been contained herein.
Page 7. Intergovernmental Cooperation Agreement
39. Modification. No modification of this Agreement shall be invalid unless in writing
and signed by the parties hereto.
40. Governing Law. This Agreement, shall. be construed in accordance with . and
governed by the laws of the State of.Oregon. Any.action regarding this Agreement or the transactions
contemplated.hereby shall be brought in anappropriate court in the,Co of Clackamas, Oregon.
IN WITNESS WHEREOF,the parties have set their hands on the dates shown below.
CITY OF LAKE OSWEGO CITY OF TIGARD
By: By:
Tide: Title:
Date Signed: Date Signed:
Page 8. Intergovernmental Cooperation Agreement
EXISTING PHYSICAL ASSETS
LAKE OSWEGO TIGARD WATER AGENCY
Remaining Revised Estimated Estimated Estimated Original Cost Eslm.Deprac.
Acquisition Acquislition Service Years In Useful Estimated Annual Accumulated Book Escalation Replacement
Capital Item Date Amount Life Service. Life Life Depreciation Depreciation Value Factor Cost
Clackamas R.Intake and P.S.
Original Facility(estimated components): 6/30/68
Struclure(60%) 121,980 75 26 50 76 1,605 41,730 80,250 5.2341 420.033
Pumps and Equipment(25%) 50,825 20 26 5 31 1,640 42,627 8.198 5.2341 42,907
Piping and Valves(10%) 20,330 50 26 25 51 399 10,364 9,966 5.2341 52,161
Electrical.19C.HVAC(5%) 10,165 20 26 5 31 328 8,525 1,640 5.2341 8,581
Subtotal 203.300 3,971 103,247 100,053 523,682
1960 Improvements: 6/30/80
Pump 40,000 20 14 10 24 1,667 23,333 16,667 1.6336 27,227
Piping and valves 10,000 50 14 35 49 204 2,857 7,143 1.6336 11,669
Electrical and 1bC 21.000 20 14 10 24 875 12,250 8,750 1.6336 14,294
Subtotal 71,000 2,746 38,440 32,560 53,189
TOTAL-Intake and P.S. 576,872
27•inch Raw Weler Pfpeline 6/30/71 590,137 50 23 27 50 11,803 271,463 318,674 5.2341 1,667,959
Water Treatment Plant
Original WTP(estimated components)- 6/30/71
Sitework(13%) 155,915 75 . 23 so 73 2,136 49.124 106,791 5.2341 558,951
Concrete and buildings(40%) 479,739 75 23 50 73 6,572 151,151 328,588 5:2341 1,719,850
Pumps(3.5%) 41,977 26 23 10 33 1,272 29,257 12,720 5.2341 66,579
Mechanical equipment(10.5%) 125,931 20 23 5 28 _ 4,498 103,444 22,488 5.2341 117,702
Piping 3 valves(16%) 191,895 50 23 25 48 3,998 91,950 99.946 5.2341 523,121
Electrical.I&C,HVAC(16%) 191,895 20 23 5 28 6,853 157,628 34,267 5.2341 179,356
Miscellaneous(1%) 11,993 75 23 .50 73 164 3.779 8,215 .5.2341 42,996
Subtotal 1,199,347 25,493 586,332 613,015 3,208,556
EXISTING PHYSICAL ASSETS
LAKE OSWEGO-TIGARD WATER AGENCY
Remaining Revised. Estimated Estimated Estimated Original Cost Estrn.Deprec.
Acquisition Acquislllion Service Years In Useful Estimated Annual Accumulated Book Escalation Replacement
Capital Item Dale Amount Ule Service Lila Life Depreciation Depreciation Value Factor Cost
WTP Land:
Original plant 6/30/66 83,797 WA WA WA WA N/A N/A NIA 5.2341 438,599
Land acquisition 6/30/90 200,243 WA WA WA WA WA N/A WA 1.1650 233,285
Subtotal 284,040 671.884
1980 Expansion: 6130/81
Sitework(6.59.) 80,221 75 13 - 60 73 1,099 14,286 65,935 1.6336 107,711
Concrete end buildings(27%) 333,224 75 13 60 73 4,565 59,341 273,883 1.6336 447,415
Pumps(7%) 86,391 20 13 10 23 3,756 48,830 37,562 1.6336 61,360
Mechanical equipment(5.59.) 67,879 20 13 10 23 2,951 38,366 29,513 1.6336 48,212
Piping A valves(29•x) 357,908 50 13 35 48 7,458 96.933 260,974 1.6336 428,327
Electrical,Id C.HVAC(14.5%) 178,954 20 13 10 23 7,781 11)1,148 77,806 1.6336 127,104
Filter Media and Underdrains(6.89.) 83,923 50 13 35 48 1,748 22,729 61,194 1.6336 99,966
Miscellaneous(3.79.) 45,664 75 13 60 73 626 8,132 37.532 1.6336 61,312
Subtotal 1,234,164 29,982 389,766 644,398 1,379,408
Chlorinator Improvements 6130186 6,158 20 8 12 20 308 2,463 3,695 1.3356 4,935
TOTAL-Water Treatment 2,723,709 55,783 978,561 1,461,108 5,264,783
Finished Water Transmission
24-inch Finished Water Pipeline(14,628 LF) 6/30!71 473,456 50 23 27 50 9,469 217,790 .,25S.666 5.2341 1,338,172
YTP Transmission Main 6130/93 .42,618 50 1 49 50 852 852 41,766 1.0417 43.507
North Shore-Iron Mtn.Pipelines 6/30/70 534,142 50 24 26 50 10,683 256,388 277,754 4.0817 1,133,700
Upper Dr.-Iron Mtn.24'Pipeline 6130/85 575.398 50 9 41 50 11,508 103,572 411,826 1.4702 693,678
TOTAL-Finished Water Transmission 1,625,613 32,512 578,602 1,047,012 3.209,057
LA l:,l 114u I Ill l l,r+l_ r+a.,L t
LAKE OSWEGO-TIGARD WATER AGENCY
Remaining Revised Estimated Estimated Estimated 7EEscaiation
nal Costg
Acquisition Acquisotion Service Years in Useful Estimated Annual Accumulated Book Ca itai ItemDate Amount Lite Service Lite Lile De reaalion De reciation Valueactor
Storage
Waluga Reservoir
3/30183 1,281,427 75 11 64 64 20,022 220,245 1,061,182 1.2800 1,358,265
Waluge Reservoir Land 6130180 6,417 WA WA WA
WA WA WA WA 1.4702 12,375
10,582 243,380 1.0417 264550
Waluge Reservoir Repairs
6130191 253.962 75 3 72 72 3,527 ,
1,635,190
TOTAL-Storage 1,543,806
TOTAL-E:Isting Capital 12,353,860
EXHIBIT "C"
0 ,4 COST ALLOCATIONS BETWEL
LAKE OSWEGO AND TIGARD
1994 2009 2010 2020
Estimated Estimated Estimated Estimated
O&M Cost O&M Cost 0&M Cost O&M Cost
O&M Item $ $1 $ $1
River Intake & P.S.
Electrical 207,007 258,925 261,722 293,050
Maintenance
5,522 6,907 11,482 12,318 Pump Maintenance 16,242 20,315 20,535 22.992
Raw Water Pipeline 5.985 7,486 7,567 8,472
Water Treatment
Clackamas R. WTP 522,118 639,614 690.127 732.848
Willamette R. WTP 57,100 57,100
Sludge Handling & Disposal
27,658 . 34,595 34,968 39,154
High Service Pumping
Electrical 343,820 430,050 434,696 486,729
Maintenance 5,569 6,966 7.041 7,884
Finished Water Pipeline
2,913 3,644 3,683 4,124
Storage Reservoir 2,500 2,500 2,500 2.500
TOTAL ANNUAL O&M 1,1399334 1,411,001 1,531,421 1,667,170
Note: O&M Costs are 1994 Dollars
-- EXHIBIT "C"
O & M COST ALLOCATIONS BETWEEN
LAKE OSWEGO AND TIGARD
1994 1994 1994 2009 2009 2010 2010 2020 2020
Estimated Allocation Factors Allocated Costs Estimeled Allocated Costs Estimated Allocated Costs EstimC od Allocated Costs
08M Cosl Maximum Mal
OdM Cosi Maximum OAM Cost Mexlmtrrn 06M Cost Maximum
08M Item f Base Da Base Da f Bese De f Bese Da f Base Oa
Ilivot Intake d P.S.
Electrical 207,007 1.0000 0.0000 207,007 0 258,925 .258,925 0 261,722 261,722 0 293,050 293,050 0
Maintenance 5,522 0.4329 0.5671 2,391 3,132 6,907 2,990 3,917 11,482 4,970 6,511 12.318 5,332 6.985
Pump Maintenance 16,242 0.4329 0.5671 7,031 9,211 20,315 8,794 11,521 20,535 8,889 11,645 22,992 9,953 13,039
Raw Water Pipeline 5,985 0.4329 0.5671 2,591 3,394 7,486 3,241 4,245 7,567 3,276 4,291 8,472 3,668 4,805
Water Treatment
Clackamas R.WTP 522,118 0.6175 0.3825 322,421 199,696 639,814 389,834 249,780 690,127 437,649 252,479 732,848 450,148 282.700
Willamette R.WTP 0 0.0000 1.0000 0 57,100 0 57,100 57,100 0 57,100
Sludge Handling d Disposal 27,658 1.0000 0.0000 27,656 0 34,595 34,595 0 34,966 34,968 0 39,154 39,154 0
High Service Pumping
Electrical 343,820 1.0000 0.0000 343,820 0 430,050 430,050 0 434,696 434,696 0 .486,729 486,729 0
Maintenance 5,569 0.4329 0.5671 2,411 3,158 6,966 3,015 3,950 7,041 3.048 3,993 7,884 3,413 4,471.
Finished Water Pipeline 2,913 - 0.4329 0.5671 1,261 1,652, 3,644 1.577 2.066 3,683 1,594 2,089 4.124 1,785 2,339
Storage Reservoir 2,500 0.4329 0.5671 1,082 1,418 2,500 1,082 1,418 2,500 1,082 1.418 2,500 1.082 1,418
TOTAL ANNUAL 09M 1.139,334 0.8054 0.1946 917,674 221,661 1,411,001 1,134,104 275.898 1,531,421 1,191,896 339,526 1.667,170 1,294,314 372.856
Note: 09M Costs are 1894 Dollars
LY[1111L11 �.-
0 & M COST ALLOCATIONS BETWEEN
LAKE OSWEGO AND TIGARD
Allocation Factors Allocated Costs
Annual O&M Maximum I Maximum Base Allocation Maximum Da Allocation Total Allocation
Year 1994$ Base De Base De Tolat Lake Oswego I Tigard I Total I Lake Oswego I Tigard I Total Lake Oswego I Ti and I Total Year
1994 1,139.334 0.8054 0.1946 917,674 221,661 1,139,334 502,390 415,263 917,674 121,771 99,889 221,661 624,162 515,173 1,139,33.1 1994
2009 1,411,001 0.8038 0.1962 1.134,104 276,896 1,411,001 582,636 551,468 1,134,104 142,357 134,540 276,898 724,993 686,009 1,411,001 2009
2010 1,531,421 0.7783 0.2217 1,191,896 339,526 1,531,421 611,694 580,202 1,191,896 174,324 165,201 339,526 786,016 745,403 1,531,421 2010
2020 1,667,170 0.7764 0.2236 1,294,314 372;856 1,667,170 648,860 645,454 1,294,314 188,001 184,855 372,856 836,862 830,308 1,667,170 2020
Note: Costs are in 1994 dollars.
- - - EXHIBIT oD1t !�
OWNERSHIP ALLOCATION OF EXISTING_ CAPITAL
Estm.Depree. A9oee9on Fedora Allocated Coats Base ABo"llort llaaknum Day A6oca0on Total Allocation
Roptacomonl Cod Riasinrmn Meaktetm
Ca del Isom 1994 3 .Beae Da Bese Oa To1e1 Lake T Total Lake Oewe T' and Total lake Oawo Ti and Tool
ClaCkamae R.Intake and P.S. -
TOTAL•inrake oral P.S. $76,672 0.4329 0.5671 249,728 327,144 $78,872 125,193 124,S3S 249,728 164,952 162,191 327,144 290,145 286,727 578,072
27-inch Raw Water Pipokns 1,667,959 0.4329 0.5671 722,060 945.699 1.687,959 361.980 360,080 722,060 476,941 468,958 945,899 838,921 829,036 1,667.959
Water Traetment Sent
70TAL-Waur Troeanont 5,264,763 0.4320 0.5671 2,279,127 2,965,656 5,264,783 1,142.563 1,196,564 2,279,127 1,605,427 1,480.229 2,905,658 2,647,990 2.816.793 5.264,783
Faeshed Water Transmission
TOTAL-Finishod Wolof Transmission 3.209,057 0.4329 0.5671 1,389.202 1,619,855 3,209,057 698,429 692,773 1,389.202 917,607 902,246 1,819,BSS 1,614,038 1.595,021 3,209,057
Storage
TOTAL-Storage 1,635,190 0.4329 0.5671 707,874 927,315 1,635.190 354,899 353,006 707,874 467,571 459,745 027,315 822,439 812,750 1.675.190
Cteokamas R.Wetor Riglde,Wo 753.000 0.4329 0.5671 325,974 427,026 753,000 '163.410 162,559 325,974 215,315 211,711 427,026 378,731 374,269 757.000
TOTAL•EaleUng Cspltal 13,106,860 0.4329 0.5671 5,673,965 7,432,895 13,108,880 2,8M,4S0 2.029,516 5,673,965 3,747,012 3,685,062 7,472,895 6.597,262 6,614.1196 13,106.860
EXHIBIT "E"
CIty of Lake Oswego
Authorized
Quantity
Source Location Water Right No. Priority cfs mgd Comments
Willamette R. P-43246 3/24n7 6.0 3.88
Clackamas R. P-37839 -7/5175 9.0 5.82
Clackamas R. P-32410 3!14/67 50.0 32.32
Well No. 4 GR-3481 9/30/48 0.98 0.63
Well No. 2 GR-3480 4/30/35 0.78 0.50
Well No. 3 GR-3482 2128/57 0.78 0.50
Subtotal groundwater. 2-54, 1.63
Subtotal surface water 65.00 42.02
Total 67,54 43.65
PENDING WATER RIGHTS
Source Application No. Amount Priority Rate
Willamette River 72217 60 cfs June 28 , 1991
0
DRAFT
ERGOVERN,MENTAL
COOPERATION AGREEMENT
BETWEEN THE CITY OF LAKE OSWEGO AND THE QTY .OF TIGARD
AUTHORIZING, JOINT OPERATION AS THE LAKE OSWEGO-TIGARD
WATER AGENCY.
This Agreement is made and entered into by and between the City of Lake Oswego ("Lake
Oswego")and the City of Tigard("Tigard")(jointly referred to herein as the "Member Utilities").
RECITALS
A. The Member Utilities desire to enter into this Intergovernmental Cooperation Agreement
(the "Agreement") to provide for the creation of an intergovernmental entity to be known as the Lake
Oswego-Tigard Water Agency("Agency") and to provide terms for the purchase of an interest by Tigard in
certain existing water facilities of Lake Oswego.
B. Lake Oswego and Tigard acknowledge each has the authority to execute this cooperative
intergovernmental agreement pursuant to the powers of each of the Cities respective municipal charters and
pursuant to ORS 225:050 and ORS 190.010.
C. Tigard presently provides water service to its residents and also pursuant to separate
intergovernmental cooperation agreement, water service to the citizens of the cities of Durham, King City
and the Tigard Water District(jointly referred to herein as "Other Utilities").
D. The Member Utilities have authorized creation of the intergovernmental entity described
herein. The ordinances authorizing such creation are attached hereto as Exhibit A. (TO FOLLOW)
NOW, THEREFORE, the premises being in general as stated in the foregoing recitals, it is agreed
by and between the Member Utilities hereto as follows:
1. Establishment and Duration. Pursuant to ORS Chapter 190, an intergovernmental
entity to be known as the Lake Oswego-Tigard Water Agency ("Agency") is hereby established in
accordance with the terms of this Agreement. The term of this Agreement shall be perpetual unless
terminated pursuant to Section 34 hereof.
2. Declaration of Public;Pu=se, This Agreement is entered into by the Member
Utilities pursuant to'ORS Chapter.190 to provide for the formation of the Agency; .the cooperation in the
management, acquisition and operation and maintenance of pumping stations, treatment plants and certain
transmission piping and storage reservoirs; and to develop the existing Clackamas and Willamette River
water permits held by Lake Oswego for the benefit of the Member Utilities. It is also intended that the
Agency shall have the power to issue tax exempt revenue bonds payable solely from revenues received
Page 1. Intergovernmental Cooperation Agreement
04104195
from Member Utilities and the Other Utilities speed herein.
3. jkfjW = Words, terms and phrases which are not specifically defined in this
Agreement shall have the ordinary meaning ascribed,to' them inthe municipal utility context unless the
context clearly indicates otherwise. When not inconsistent with the context, words used in the plural
number include the singular and words in the singular include the plural. The word "shall" is mandatory
and.not merely directory. Unless the context clearly indicates otherwise, the following words, terms and
phrases shall mean:
"Agency"means the Lake Oswego-Tigard Water Agency.
"Agreement" means this Intergovernmental Cooperation Agreement entered into by the
Member Utilities.
"Board" means the Board of Directors of the Lake Oswego-Tigard Water Agency appointed
pursuant to Section 5 hereof.
"Member Utilities" means Lake Oswego and Tigard.
"Other Utilities" means Durham, King City and the Tigard Water District and those other
water providers located within the urban services boundary of the City of Lake Oswego.
"Effective Date" means the date upon which the signatory's to this agreement have
signed their names.
"Implementation Date"means the date upon which Agency facilities,necessary to
supply, treat and transmit up to 32.3 MGD of water,are operational.
the "System"means those certain pumping,water treatment,transmission piping and
storage and metering facilities owned by the Agency and,operated and maintained for
the purpose of supplying water to the member utilities.
"Design Capacity" For the purposes of this Agreement and pursuant to the implementation
date,design capacity will beequivalent to 32.3 MGD. Subsequent expansions or
improvements to the System shall cause the design capacity to be equivalent to the existing
design capacity plus the increment of capacity created bythe expansion or improvement,the
sum-of which shall not exceed the volume of water available for appropriation under the
permits'enumerated in Section 15 of this Agreement and those new:permits which may be
issued in the future.
Emergency" as.used in the context of emergency water.supply through existing interties
shall meana failure of the water system-ofany water.provider or Other Utility which is
intertied-with a Member Utility with said;failure resulting`frommatural or manmade causes
which.can include earthquake or power failure and which a Member Utility,in its sole
Page 2. Intergovernmental Cooperation Agreement
'IWDAGRO.DW
OWNS
discretion,determines to be an emergency condition.
4. Powers. Agency shall have the following powers:
(a) To establish a Board for the acquisition, constriction, operation, management and
control'of matters referred to herein;
(b) To adopt bylaws to govern its internal operation and management;
(c) To issue, sell or otherwise dispose of bonds, securities, or other forms of
indebtedness for the purpose of carrying out any of the matters permitted by these powers and to finance all
costs of issuance related thereto; and
(d) To perform pursuant to ORS 190.003 to ORS 190.250 (the "Act") all powers
pursuant to the Act, applicable charters, ordinances, and state or federal laws, which are necessary to
efficiently operate, maintain and expand its-water facilities and projects including the power to issue
revenue bonds under ORS 288.805 to 288.945.
(e) To perform pursuant to ORS 190.00 - 190.250 all powers including rate making
pursuant to applicable charter,ordinance or state or federal laws, which.are necessary to efficiently.operate,
maintain and expand the System.
(f) To establish a System Development .Charge (SDC) to be assessed against new
customers connecting to the respective distribution systems of the Member Utilities. Such revenues shall
accrue to the Agency.
5. Board Membership. The Board shall initially consist of three City Councilors from Lake
Oswego and two City Councilors from Tigard. The Lake Oswego board representatives shall be made by
the Lake Oswego City Council and the Tigard board representatives shall,be made by the Tigard City
Council. The fifth board seat shall be rotated,every five years between.Lake Oswego and Tigard following
the initial five year term by a Lake Oswego Councilor. The composition of the Board shall not be affected
by the respective water consumption of the Member Utilities and all members of the Board shall be
Councilors of Lake Oswego and Tigard,respectfully.
6. Terms of Office. Upon the execution of this Agreement, Lake Oswego and
Tigard shall appoint their respective Board Members. The initial term of one Lake Oswego and one Tigard
Board Member shall expire January 1, 1997. The initial terms of two Lake Oswego Board Members and
one-Tigard Board Member shall expire January 1, 1999. Thereafter, all new Board Member positions shall
be for a term of four.years except for the rotating fifth seat, which shall be for five years. Board.Members
may be re-appointed to succeeding terms. Board Members-may be replaced at will by the respective City
Councils.
7. Vacancies and Substitutions. Both Lake Oswego and Tigard shall have unilateral
authority to fill a vacancy or substitute another person for membership on the Board Any person appointed
Page 3. Intergovernmental Cooperation Agreement
T"AOROMM
04104#95
to fill a vacancy shall serve for the remainder of the unexpired:term. Any person appointed pursuant to this
Section 7 may be appointed for a:regular term pursuant to Section.6 hereof.
8. Chair and Vice Chair. At the first meeting of the Board, the Board shall elect a Chair
and Vice Chair to serve'until January 1, 1997. Thereafter,,a Chair and Vice Chair shall be elected for a
terms of.two(2):years. For all subsequent,two (2) year"terms, the positions of Chair and Vice Chair shall
alternate between Lake Oswego and Tigard.
9. Conflict of Interest. Board members shall be public officials subject to the
provisions of ORS Chapter 244. No person shall serve as a member of the Board if a business with which
that person is associated,as defined in ORS 244.020(2),has any interest in the activities of the Agency.
10. MeetingsQuorum. Regular meetings of the Board shall be conducted at such
times as the Board may designate. The Chair upon his or her own motion,may,or at the request of two (2)
members of the Board, shall, by giving notice to members of the Board, call a previously unannounced
special meeting of the Board for a time not earlier than twenty-four (24) hours after the notice is given,
unless an emergency exists. In cases of an emergency, notice reasonable under the circumstances shall be
given. Three-fifths (3/5) of the Board shall constitute a quorum to conduct business. For major items of
business as defined in Exhibit "D" herein, (TO FOLLOW) the concurrence of the majority of the quorum
and one affirmative vote cast by a quorum member,from each City shall be necessary to decide issues
before the Board.
11. Manager and Secretary. The Lake Oswego City Manager or designee shall
serve as Manager of the Agency for the first ten years following the effective date of this agreement or until
the implementation date, whichever comes first. The Secretary shall be the Tigard City Administrator or
designee. The Manager, Secretary or their designee's shall be full time employees of Lake Owego and
Tigard,respectively. A non-full time employee of either agency shall not serve in either capacity,:nor shall
the positions be contracted. The Manager's and Secretary's positions shall rotate between the Lake Oswego
City Manager and the Tigard City Administrator for each five year period thereafter. Compensation,if any,
for Lake Oswego City Manager and Tigard City Administrator or designee services to the Agency shall be
determined by the Agency. The Manager shall, (1) be the chief budget and fiscal officer of Board, (2) be
the chief purchasing and business agent of Board, (3) prepare and submit to the Board financial activity
reports and prepare such other reports and information as the Board may require. The Secretary shall be
responsible for the Board's records and shall keep a record of all Board proceedings.
12. Description of Physical Assets. The present market value of real property and
improvements thereon and the present depreciated replacement value of physical assets and other pertinent
information related thereto as set forth in the attached Exhibit "B" (TO FOLLOW) constitute the System
under the terms of this Agreement and are hereby contributed to the Agency by Lake Oswego as of the
effective date of this Agreement.
13. Debts of the Aged No bonded,debt of the.Lake Oswego-Tigard Water Agency
shall be incurred without approval of the Board. Approval shall require the affirmative vote of a majority
of the Board with not less than one representative from each respective Member Utility included in the
Page 4. Intergovernmental Cooperation Agreement
MDAGM.DOC
04p4/95
majority.
14. Oo ndon and Maintenance(O Ulocadws. Pursuant to the
'implementation date, costs .for operation and maintenance of the System will be allocated between the
Member Utilities using,the base-extra;capacity method (Water Rates, American Water Works Association,
Manual Ml, 1991)which allocates'O &M cost components-to base and maximum day categories. The
methodology for O & M cost allocations;are reflected in the tables attached hereto as Exhibit "C"*(TO
FOLLOW)and incorporatedherein by this.r+eference.
15. Allocation of Raw Water. Upon execution of this Agreement, the Agency shall
appropriate raw water, subject to the permits enumerated below, as required for efficient operation of the
System and to assure a continuous and adequate supply of treated water to meet the needs of the Member
Utilities. In the event that water under these permits cannot be fully developed, Lake Oswego shall retain
rights to not less than 23 MGD of raw water under such permits.
Permit NumbeMource\0uantity Lake Oswego Tigard
P-32410VClackamas RN32.3 MGD
P-37839VClackamas RN5.8 MGD
P-4tette RN3.9 MGD
Total Allocated (23.0 MGD) (19.0 MGD)
16. Water Production. On or after the implementation date, each Member
Utility shall be entitled to treated water up to that portion of the then existing design capacity of the System
as shall be less than or equal to the requesting utilities allocation of the System pursuant to paragraph 18.
17. DispmaQ ionate Use of Treated Water. If, during the term of this
Agreement, a Member Utility consumes treated water in excess of its allocated share, said Member Utility
shall compensate the contributing utility for the excess treated water so consumed. The, amount of
compensation shall be determined by multiplying the percentage of excess use made of the System.by the
member utility by the sum of: 1) the agreed upon value of the then existing System, and 2)� the
undepreciated, unamortized costs of any expansion or improvements of the System theretofore authorized
by the Agency. The product so determined shall be multiplied by an interest factor .determined by
averaging municipal bond interest rates,quoted in the "Bond Buyer Index" as published in the "The Oregon
Bond Advisor", during the period of disproportionate use. The product of the calculation shall be the
amount of compensation paid to the member utility contributing the,portion of its allocation of the System's
design capacity. For the purposes of this paragraph, "excess"use of treated water shall mean use in which a
member utility exceeds its allocation of the System's design capacity during any month of any calendar
year-
18. Ownership Allocation of the System. Initial ownership in the System shall be
allocated between Lake Oswego and Tigard based upon the ratio of Lake Oswego's peak day water
demands estimated for the year 2040 to the total volume of developable water under Lake Oswego's
permits, with the remainder being allocated to Tigard. Lake Oswegds share of the System shall be
Page 5. Intergovernmental Cooperation Agreement
1WDAGM7.DW
04MOS
23/42nds and TiganTs share shall be 19/42nds. In the event that permitted rights cannot be fully developed,
the ownership allocation of the,System shall be revised to reflect the developed water rights. Lake Oswego
shall retain rights to 23 MGD and the denominator of the fraction "'be adjusted to reflect the developed
water rights.
19. Cpital,Cost Allocation. Project costs for the initial expansion will include the
depreciated replacement cost of the existing System pursuant to paragraph 12 and the estimated costs of the
expansion of the System to 32.3 MGD. Estimated expansion costs are shown in Exhibit "G" (To.Follow).
Pursuant to the Implementation Date,these costs shall be allocated to the Member Utilities in proportion to
the allocations described in Section 15. Lake Oswego shall receive credit for the contribution of the
existing System pursuant to Section 12.
20. Physical Asset Adjustment.
Pursuant to Section 16, the Member Utilities hereby agree upon an initial ownership allocation of the
System. Ownership allocation entitles each party to purchase water in volumes proportionate to that
allocation. In the event that Lake Oswego's permitted rights cannot be fully developed,Tigard agrees to a
transfer of asset ownership to Lake Oswego in proportion to its water demands on an annual basis up to a
maximum of 23 MGD. Take Oswego shall make an annual payment to Tigard based on the depreciated
replacement cost of the assets being transferred. Payment shall be in cash to the Member Utility receiving
payment for assets purchased
21. Future Improvements. Costs for improvements to System shall be allocated to
the Member Utilities on the basis of their respective ownership allocation in the System in effect'at the time
of the improvement.
22. Water Rights. Lake Oswego presently has several permits to appropriate the waters
of the State of Oregon for Municipal use. The City is permitted to appropriate,up to 38 million gallons per
day (MGD) from the Clackamas River, 3.9 MGD from the Willamette River and 1.64 MGD from ground
water. These water permits are summarized in Exhibit "E" (To Follow) attached hereto and incorporated
herein by this reference. Water appropriated from run of river sources within the terms of Lake Oswego's
existing permits will be dedicated for use to the benefit of the Member Utilities. However, no portion of
these existing permits shall be transferred to the Agency.
23. Existing Wholesale Customers. The Member Utilities shall be permitted to sell
treated water to their respective wholesale and retail customers which have been established prior to the
effective date of this Agreement and such sales shall not be subject to the terms of this section and shall be
considered as part of the water diverted into the separate systems of each Member Utility. A list of the
existing wholesale/retail customers of each Member Utility is attached hereto as Exhibit "F", (To Follow).
Any sales of treated water to wholesale/retail customers not listed in Exhibit "F" must be approved by,the
Agency. No agreement or .understanding with the customers listed in Exhibit "F" may be modified to
increase the volume of water committed or to alter the priorityof service,without prior Agency approval.
Page 6. Intergovernmental Cooperation Agreement
1WDAGM.DW
04MO95
24. E mhases of Treated Water. Pursuant to the implementation date, each Member
Utility shall be obligated to purchase treated water from the Agency up to the then existing design capacity
of the System prior to the purchase of treated water from other sources. Tigard shall be exempted from this
obligation for a period of not more than five years from the implementation date defined herein.
25.' Water Management and Conservation Plans. The Member Utilities agree that a Water
Management and Conservation Plan is necessary and is a priority and that such a plan will be developed by
each Member Utility and presented to the Board for adoption. The Member Utilities agree to exercise due
diligence in preparing such plans.and to prepare,said plans in accordance with the guidelines of Oregon
Administrative Rules(OAR) Chapter 690, Division 86. Pursuant to adoption by the Board, said plans will
be presented to the Water Resources Department for approval. Such Water Management and Conservation
Plans shall be incorporated into this Agreement by reference.
26. Curtailment of Water Supply, The Member Utilities agree that at such times as
supplies of raw or treated water are insufficient to meet the water demands of the Member Utilities, each
Member Utility shall impose water management and conservation plans heretofore described and as
adopted by the Agency. In extreme cases of water supply deficiencies, the Board shall,in a timely manner,
hold a special meeting to determine what additional water curtailment measures will be adopted.
27. Eme ency Water Sales. The Member Utilities agree that water system interties
with other water providers are a critical component•of their respective distribution systems. The Member
Utilities further agree.that water sold through.these interties for emergency purposes shall take precedence
over water sold for its own customers and:wholesale customers except that such emergency sales shall not
result in the creation-of emergency conditions for the Member Utility. Costs of water sold through each
Member Utility's respective system interties shall be at the unit cost established in existing
intergovernmental cooperation agreements in force as of the implementation date of this Agreement.
Member Utilities shall provide not less than six months notice to the Board of any proposed.new intertie(s)
to their respective distribution systems. The Board may at its discretion,disapprove any proposed intertie if
it is deemed not to be in the best interests of the.Agency.
28. Water Sales During the Implementation Period. Pursuant to the effective date of
this Agreement and for a period not to exceed three years, Lake Oswego agrees to sell water in excess of
Lake Oswego's water demands to the City of Tigard. Lake Oswego willendeavor during this period to
supply Tigard with an annual volume of water not less than the average volume of water purchased by
Tigard during the previous three years based upon usage records provided by Tigard. Tigard agrees that
during this same period, its water needs will be subordinate to those of Lake'Oswego when surplus treated
water is not available. During this period, Lake Oswego reserves the right to adjust the price of surplus
water sold to Tigard to reflect current market conditions.
29. Periodic Review of Intergovernmental Agent. Following creation of the Board,
it shall be established by a majority vote of the Board, that a periodic review, of this Agreement will be
performed Board will determine the frequency of such a review.
Page 7. Intergovernmental Cooperation Agreement
TYMAORE7.11)OC
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30. Local Contract Review Board, The Local Contract Review Board of the
Agency shall be the Agency's Board.
31. Contracting for Services. Initially the Agency shall contract with the City of
Lake Oswego to perform such duties requir &of the Agency by this,Agreement.. Bonding and/or insurance
requirements for such contract employees shall be provided by-the respective Member Utility. Bonding
and/or Insurance requirements for Manager, Secretary and.Board members shall be provided by the
Agency,
32. Expenditures. No funds of the Agency shall be expended except upon the vote of the
Board and in furtherance of the purposes of the Board; except that expenditures within the limitations of the
Board approved budget may be made by the Manager. Additional authorized signatures shall include the
Chair,Vice Chair or Secretary in the event the Manager is unable to perform. The Board shall institute by-
laws to assure compliance with Local Budget Law.
33. Amendment Provisions. The terms of-this Agreement may be amended for any
purpose including, without limitation, the addition or deletion of Member Utilities. Any such amendment
shall be in writing and shall refer specifically to this Agreement and shall be adopted by all the governing
bodies of the Member Utilities.
34. Termination and Dissolution. This Agreement may terminated upon ten (10) years
advance written notice by a vote of the,governing boards of the Member Utilities except when bonded debt
Of the Agency is outstanding in which case the termination date shall coincide with the date that outstanding
bonds are fully repaid, whichever occurs later. Upon approval of termination by the Member Utilities, the
Chair of the Board shall direct that an accounting of assets and liabilities be'conducted and presented to the
Board and to the governing bodies of the respective Member Utilities. The Member Utilities shall
thereafter meet and agree upon an equitable distribution of any assets and liabilities, which may include a
reserve account for contingent,.unliquidated or unforeseen liabilities or obligations. If the Member Utilities
are unable to agree to the division of assets and liabilities, the Circuit Court of Clackamas County shall
have jurisdiction to.decide the issue. Tigard has separate intergovernmental agreements with the Other
Utilities and under the terms of those other agreements the Other Utilities could withdraw from their
present relationship with Tigard. In no event shall such a withdrawal by one or more of the Other Utilities
from their relationship with Tigard constitute an act of termination or dissolution of this Agreement.
35. Public Records and Meetings. The Agency shall comply with all applicable
requirements of ORS Chapter 192 concerning public records and public meetings.
36. Cnsation.Expenses: Compensation, if any, for members of the Board for
services provided as Board members in addition to reimbursement of actual and necessary travel and other
expenses incurred in the performance of their duties,shall'be determined by the Agency.
Page 8. Intergovernmental Cooperation Agreement
OWJ95
37. Effective Date, This Agreement will be effective legally upon this execution
by the last Member Utility signing this agreement.
38. Written Notice Addresses. All written notices required under this Agreement shall
be sent to:
City of Lake Oswego City of Tigard
City Manager City Administrator
PO Box 369 13125 SW Hall Blvd.
Lake Oswego,OR 97034 . Tigard,OR 97223
39. Sever. If any provision of this Agreement shall be held to be invalid, illegal
or unenforceable, such:invalidity, illegality or unenforceability shall not affect any other provisions of this
Agreement,but this Agreement shallbe construed as if such invalid,illegal or unenforceable provisions had
never been contained herein.
40. Modification. No modification of this Agreement shall be valid unless in writing and
signed by the parties hereto.
41. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Oregon. Any action regarding this Agreement or the transactions
contemplated hereby shalle.brought in an appropriate court in the County of Clackamas,Oregon.
IN WITNESS WHEREOF,the parties have set their hands on the dates shown below.
CITY OF LAKE OSWEGO CITY OF TIGARD
By: By:
Title• Title:
Date Signed: Date Signed:
Page 9. Intergovernmental Cooperation Agreement
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EXIEIIBff "D"
DRAB
'pursuant to paragraph 10 of this Agreement,major items of business shall be any Board action
involving the following:
1.Issuance of Bonds for capital improvements.
2.Capital improvement projects exceeding$25.000-
3.Amendments to the Agreement.
4.Adding members to this Agreement.
5.Establishing systems development charges(SDCs).
6.Establishing water rates.
7.Adding new interties.
8.Curtailment of water;supply.
9.Adoption and implementation,of water management and conservation plans.
10.physical asset adjustment.
11.Addition or deletion of wholesale customers.
12.Review end approval of contracts for capital improvement projects and programs.
Exhibit"D"
Intergovernmental Cooperation Agreement
aMoW
Y
. City of Lake Oswego
Department of Public Works
TRANSMITTAL
TO: City of Tigard FROM: Joel B. Komarek, P.E.
City Hall PHONE#: 697-6588
Tigard, Oregon 97223 DATE: December 6, 1994
Attn: Mr. Bill Monahan
RE: Draft Intergovernmental Agreement PROJECT#:
WE ARE SENDING YOU:
X ATTACHED UNDER SEPARATE COVER VIA
SHOP DRAWINGS DOCUMENTS
PRINTS SPECIFICATIONS
COPY OF LETTER OTHER
QUANTITY DOCUMENT DESCRIPTION
3 Draft Intergovernmental Cooperation Agreement for Joint Water Service
1F MATERIAL IS NOT RECEIVED AS LISTED, PLEASE NOTIFY US AT ONCE.
REMARKS:
Dear Bill:
Transmitted herewith is the draft IGA for your review. We are all looking forward to our meeting with you
on 12/8/94 at 2:00 pm.
c:
380 A Avenue 9 P. 0. Box 369•Lake Oswego,Oregon 97034•(503)635-0270•(503)635-0269 FAX
r Y
MY OF TIGARD
OREGON SETTING THE STANDARD FOR SERVICE EXCELLENCE
Facsimile
To: )wr, te m aM c(o ,4 'cc...
Company: notw,
Phone:
Fax:
From: G,�. OWL,
Company: City of Tigard
Phone: (503) 639-4171
Fax: (503) 684-7297
Date: c. /p
Pages including this page:
COMMENTS:
A, d4
4� A//`r` �W v� Cil
I
City of Tigard, 13125 SW Hall Blvd.,Tgard, OR 97223
'* PLEASE 'DELIVER THIS FAX IMMEDIATELY '*
A J -
of the Board with not less than one representative from each respective Member Utility included in the
majoity. -
14. Operation and Maintenance(O&M)Cyst Allocations. Pursuant .to the
implementation date, costs for operation and maintenance of the System will be allocated between the
Member Utilities using the base-extra capacity method (Water Rates_ American Water Works Association,
Manual Ml, 1991) which allocates O & M cost components to base and maximum day categories. The
.. methodology for O tit M cost allocations are reflected in the tables attached hereto as Exhibit "C" (TO
FOLLOW)and incorporated herein by this reference.
15. Allocation of Raw Water. Upon execution of this Agreement, the Ag m7 shall .
appropriate raw water, subject to the permits enumerated below, as required for efficient operation of the
System and-to assure a continuous and adequate supply of treated water to meet the needs of the Member
Utilities. In the event that water under these permits cannot be fully developed,Lake Oswego shall retain
rights to not less than 23 MGD of raw water under such permits.
Permit NumbeASUmw9banft Lake Oswego rigAw
P 3241wackamas RN32.3 MGD
•
P 37839MClackamas k\5.8 MGD
P�3246�W'11amettte R\3.9 MCD
Total Allocated (23.0 MGD) (19.0 MGD)
16. Water Production. On or atter the implementation date, each Member
Utility shall be entitled to treated water up-to that portion of the then existing design capacity of the System
as shall be less than or equal to the requesting utilities allocation of the System pursuant to paragraph 18.
17. . )inonowonate Use of Treated Water. ff, during the term of this
Agreement,a Member Utility consumes treated water in excess of its allocated share, said Member Utility
shall compensate the contributing utility for the excess treated water so consumed. The amount of
compensation shall be determined by multiplying the percentage of excess use made of the Symon by the
member.utility by the sum of: 1) the agreed upon value of the then existing Systema, and 2) tic
undepsecaated, unanaoatized costs of any expansion or impmvemeats of the System theretofore authorized
by the Agency. The product so determined shallbe multiplied by an interest factor determined--by
averaging over the period of disproportionate use, the interest rate of mwnicipal revenue bonds with
equivalent terms quoted in the "Bond Buyer Index" as published in the."The Oregon Bond Advisor." The
product of the calculation shall be the amount of compensation paid to the member utility contributing the
portion of its allocation of the System's design capacity. For the purposes of this paragraph,"excess"use of
treated water shall mean use in which a member utility exceeds its allocation of the System's design
capacity during any month of any calendar year. _
18. Q=Uft Allocation of the Svc Initial ownership in the System shall be
allocated between Lake Oswego and Tigard based upon the ratio of Lake Oswegos peak day water
demands estimated for the year 2040 to the total volume of developable water under Lake Oswego's
Page 5. Intergovernmental Cooperation Agreement
iwnonacnoc
mows .
i yy) Sl,ernn awe,
DRAFT
INTERGOVERNMENTAL.
COOPERATION AGREEMENT
BETWEEN THE CITY OF LAKE OSWEGO AND THE CITY. OF TIGARD
AUTHORIZING JOINT OPERATION AS THE LAKE OSWEGO-TIGARD
WATER AGENCY.
This Agreement is made and entered into by and between the City of Lake Oswego ("Lake
Oswego")and the City of Tigard("Tigard")(jointly referred to herein as the"Member Utilities").
RECITALS:
A. The Member Utilities desire to enter into this Intergovernmental Cooperation Agreement
(the "Agreement") to provide for the creation of an intergovernmental entity to be known as the Lake
Oswego-Tigard Water Agency("Agency") and to provide terms for the purchase of an interest by Tigard in
certain existing water facilities of Lake Oswego.
B. Lake Oswego and Tigard acknowledge each has the authority to execute this cooperative
intergovernmental agreement pursuant to the powers of each of the Cities respective municipal charters and
pursuant to ORS 225.050 and ORS 190.010.
C. Tigard presently provides water service to its residents and also pursuant to separate
intergovernmental cooperation agreement, water service to the citizens of the cities of Durham, King.City
and the Tigard Water District(jointly referred to herein as "Other Utilities").
D. The Member Utilities have authorized creation of the intergovernmental entity described
herein. The ordinances authorizing such creation are attached hereto as Exhibit A. (TO FOLLOW)
NOW, THEREFORE, the premises being in general as stated in the foregoing recitals, it is agreed
by and between the Member Utilities hereto as follows:
1. Establishment and Duration. Pursuant to ORS Chapter 190, an intergovernmental
entity to be known as the Lake Oswego-Tigard Water Agency ("Agency") is hereby established.in
accordance with the terms of this..Agreement. The term of this Agreement. shall be perpetual unless
terminated pursuant to Section 34 hereof.
2. Declaration of Public Pun= This.Agreement is entered into by the Member
Utilities pursuant to ORS Chapter 190 to provide for the formation of the Agency; the cooperation in the
management, acquisition and.operation and maintenance of pumping stations, treatment plants and certain
transmission piping and storage reservoirs; and;to develop the existing Clackamas and Willamette River
Water permits held:by Lake Oswego for the benefit of she Member Utilities. Itis also intended that the
Agency shall have the power to issue tax exempt revenue bonds payable solely from revenues received
Post't®Fax to 7671 Date pages
Page 1. Intergovernmental Cooperation Agreement TO yr �ems� Fro 4 �
TWDA(3"DW C pt. Co.
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one# Phone
Fax#
Fax# CD�'f! "_7[a 4
from Member Utilities and the Other Utilities specified herein.
3. Definitions. Words, terms and phrases which are not specifically defined in this
Agreement shall have the ordinary meaning ascribed to them in the municipal utility context unless the
context clearly indicates otherwise. When not inconsistent with the context, words used in the plural
number include the singular and words in the singular include the plural. The word "shall" is mandatory
and:not merely directory. Unless the,context clearlyindicates otherwise,-the following words, terms and
phrases shall mean:
"Agency"means the Lake Oswego-Tigard Water Agency.
"Agreement" means this Intergovernmental Cooperation Agreement entered into by the
Member Utilities.
"Board" means the Board of Directors of the Lake Oswego-Tigard Water Agency appointed
pursuant to Section 5 hereof.
"Member Utilities" means Lake Oswego and Tigard.
"Other Utilities" means Durham, King City and the Tigard Water District.and those other
water providers located within the urban services boundary of the City of Lake:Oswego.
"Effective Date"means the date upon which the signatory's to this agreement have
signed their names.
"Implementation Date" means the date upon which Agencyfacilities,necessary to
supply, treat and transmit up to 32.3 MGD of water,are operational.
the "System"means those certain pumping,water treatment,transmission piping and
storage and metering facilities owned by the.Agency and operated and maintained for
the purpose of supplying water to the member utilities.
"Design Capacity" For the purposes of this Agreement and pursuant to the implementation
date,design capacity will be equivalent to 32.3 MGD. Subsequent expansions or
improvements to the System shall cause the design capacity to be equivalent to the existing
design capacity plus the increment of capacity created by the expansion or improvement,the
sumzf which shall not exceed the volume of water available for appropriation under the
permits enumerated in Section 15 of this Agreement and those new permits which may be
issued in the future.
'Emergency" as used in the context of emergency water'supply throughexisting interties
shall mean a failure of the water system of any water provider or Other Utility which is
intertied with a Member Utility with said failure resulting from natural or manmade causes
which can include earthquake or power failure and which a Member Utility,in its sole
Page 2. Intergovernmental Cooperation Agreement
1WDAGFMJ OC
04/04/95
1�1
M
discretion,determines to be an emergency condition.
4. powers. Agency shall have the following powers:
(a) To establish a Board for the acquisition, construction, operation, management and
control of matters referred to herein;
(b) To adopt bylaws to govern its internal operation and management;
(c) To issue, sell or otherwise dispose of bonds, securities, or other forms of
indebtedness for the purpose of carrying out any of the matters permitted by these powers and to finance all
costs of issuance related thereto; and
(d) To perform pursuant to ORS 190.003 to ORS 190.250 (the "Act") all powers
pursuant to the Act, applicable charters, ordinances, and state or federal laws, which are necessary to
efficiently operate, maintain and expand its water facilities and projects including the power to issue
revenue bonds under ORS 288.805 to 288.945.
(e) To perform pursuant to ORS 190.00 - 190.250 all powers including rate making
pursuant to applicable charter,ordinance or state or federal laws,which are necessary to efficiently operate,
maintain and expand the System.
(f) To establish a System Development Charge (SDC) to be assessed against new
customers connecting to the respective distribution systems of the Member Utilities. Such revenues shall
accrue to the Agency.
5. Board Membership. The Board shall initially consist of three City Councilors from Lake
Oswego and two City Councilors from Tigard. The Lake Oswego board representatives shall be made by
the Lake Oswego City Council and the Tigard board representatives shall be.made by the Tigard City
Council. The fifth board seat shall be rotated every five years between Lake Oswego and Tigard following
the initial five year term by a Lake Oswego Councilor. The composition of.the Board shall not;be affected
by the respective water consumption of the Member Utilities and all members of the Board shall be
Councilors of Lake Oswego and Tigard,respectfully.
6. Terms of Office. Upon the execution of this Agreement, Lake Oswego and
Tigard shall appoint their respective Board Members. The initial term of one Lake Oswego and one Tigard
Board Member,shall expire January 1, 1997. The initial terms of two Lake Oswego Board Members and
one Tigard Board Member shall expire January 1, 1999. Thereafter, all new Board Member positions shall .
be fora term of four years except for the rotating fifth,seat, which shall be for five years. Board Members
may be re-appointed to.succeeding terms.. Board Members may be replaced at will by the respective City
Councils.
7. Vacancies and Substitutions. Both Lake Oswego and Tigard shall have unilateral
authority to fill a vacancy or'substitute another person formembership on the Board Any person appointed
.Page 3. Intergovernmental Cooperation Agreement
1WDAORB MW
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to fill a vacancy shall serve for the remainder of the unexpired term. Any person appointed pursuant to this
Section 7 may be appointed for a regular term pursuant to Section 6 hereof.
8. Chair and Vice Chair. At the first meeting of the Board, the Board shall elect a Chair
and Vice Chair to serve until January 1, 1997. Thereafter,,a Chair and Vice Chair shall be elected for a
terms of two(2) years. For all subsequent two.(2) year terms, the positions of Chair and Vice Chair shall
alternate between Lake Oswego and Tigard.. "
9. Conflict of Interest. Board members shall be public officials subject to the
provisions of ORS Chapter 244. No person shall serve as a member of the Board if a business with which
that person is associated,as defined in ORS 244.020(2),has any interest in the activities of the Agency.
10. MmfingaQuorum. Regular meetings of the Board shall be conducted at such
times as the Board may designate. The Chair upon his or her own motion,may,or at the request of two (2)
members of the Board, shall, by giving notice to members of the Board, call a previously unannounced
special meeting of the Board for a time not earlier than twenty-four (24) hours after the notice is given,
unless an emergency exists. In cases of an emergency, notice reasonable under the circumstances shall be
given. Three-fifths (3/5) of the Board shall constitute a quorum to conduct business. For major items of
business as defined in Exhibit "D" herein, (TO FOLLOW) the concurrence of the majority of the quorum
and one affirmative vote cast by a quorum member from each City shall be necessary to decide issues
before the Board
11. The Lake Oswego City Manager or designee shall
serve as Manager of the Agency for the first ten years following the effective date of..this agreement or until
the implementation-date, whichever comes first. The Secretary shall be the Tigard City Administrator or
designee. The Manager, Secretary or their designee's shall be full time employees of Lake Owego and
Tigard,respectively. A non-full time employee of either agency shall.not serve in either,capacity,nor shall
the positions be contracted. The Manager's and Secretary's positions shall rotate between,.the Lake.Oswego
City Manager and the Tigard City Administrator.for each five year period thereafter. Compensation,if any,
for Lake Oswego City Manager and Tigard City Administrator or designee services to the Agency shall be
determined by the Agency. The Manager shall, (1) be the chief budget and"fiscal officer of Board, (2) be
the chief purchasing and business agent of Board, (3) prepare and submit to the Board financial activity
reports and prepare such other reports and information as the Board may require. The Secretary shall be
responsible for the Board's records and shall keep a record of all Board proceedings.
12. <Description of Physical Assets. The present market value of real property and
improvements thereon and the present depreciated replacement value of physical assets and other pertinent
Information related thereto as set forth in the attached Exhibit "B" (TO.FOLLOW) constitute the System
under the terms of this Agreement and are hereby contributed to the Agency by Lake Oswego as of the
effective.date.of this Agreement.
13. Debts of the Agency. No. bonded debt of the Lake Oswego-Tigard Water Agency
shall be incurred without approval of the Board. Approval shall require the-affirmative vote of a majority
of the Board with not less than one -representative from each respective Member Utility included in the
Page 4. Intergovernmental Cooperation Agreement
TWDACW".WC
04/005
majority.
14. t7pmdan and Maintenance(O&M)Cost Allocations. Pursuant to. the
implementation date, costs for operation and maintenance of the System will be allocated between the
Member Utilities using the base-extra capacity method.(Water Rates,,American Water Works Association,
Manual Ml, 1991) which allocates O & 'M cost components to base and maximum day categories. The
methodology for O & M cost allocations are reflected in the tables attached hereto as, Exhibit "C" (TO
FOLLOW)and incorporated herein by this reference.
15. Allocation of Raw Water. Upon execution of this Agreement, the Agency shall
appropriate raw water, subject to the permits enumerated below, as required for efficient operation of the
System and to assure a continuous and adequate supply of treated water to meet the needs of the Member
Utilities. In the event that water under these permits cannot be fully developed,Lake Oswego shall retain
rights to not less than 23 MGD of raw water under such permits.
Permit Numbe&Source�Wantity Lake Oswego Tigard
P-3241MIackamas RN32.3 MGD
P-37839\Clackamas RN5.8 MGD
P-43246\Willamette RN3.9 MGD
Total Allocated (23.0 MGD) (19.0 MGD)
16. Water Production. On or after the implementation date, each Member
-Utility shall be entitled to mated water up to that portion of the then existing design capacity of the,System
as shall be less than or equal to the requesting utilities allocation of the System.pursuant to paragraph 18.
17. DiagmUgrtionate Use of Treated Water. If, during the term of this -
Agreement, a Member Utility consumes treated water in excess of its allocated share, said Member Utility
shall compensate the contributing utility for the excess treated water so:consumed. The amount of
compensation shall be determined by multiplying the percentage of excess use made of the System by the
member utility by the sum of: 1) the agreed -upon value of the then existing System, and 2) the
undepreciated, unamortized costs of any expansion_or improvements of the.System theretofore authorized
by the Agency. The product so determined shall be multiplied by an interest factor determined by
averaging-municipal bond interest rates,quoted in the 'Bond Buyer Index" as published in the "The Oregon
Bond Advisor", during the period of disproportionate use. The product of the calculation shall be the
amount of compensation paid to the member utility contributing the portion of its allocation of the System's
design capacity. For the.purposes of this paragraph, "excess"use of treated water shall mean use in which a
member utility exceeds its allocation of the System's design capacity during any month of any calendar
year.
18. Ownership Allocation of the System. Initial ownership in the System shall be
allocated between Lake Oswego and Tigard based upon the ratio of Lake Oswego's Peak day water
demands estimated for the year 2040 to the total volume of developable water under Lake Oswego's
permits, with the remainder being allocated to Tigard. Lake Oswego's share of the System ,shall be
Page 5. Intergovernmental Cooperation Agreement
T"AGROMM
. 04104195 ..
1
23/42nds and Tigard's share shall be 19/42nds. In the event that permitted rights-cannot be fully developed,
the ownership allocation of the System shall be revised to reflect the developed water rights. Lake Oswego
shall retain rights to 23 MGD and the denominator of the fraction shall be adjusted to reflect the developed
water rights.
19. Capital Cost AlliaGatim. Project costs for the initial expansion will include the
depreciated replacement cost of the existing System pursuant to paragraph 12 and the estimated costs of the
expansion of the System to 32.3 MGD. Estimated expansion costs are shown in Exhibit "G" (To Follow).
Pursuant to the:Implementation Date,these costs shall be allocated to the Member Utilities in proportion to
the allocations described in Section 15. Lake Oswego shall ,receive credit for the contribution of the
existing System pursuant to Section 12.
20. Physical Asset Adjustment.
Pursuant to Section 16, the Member Utilities hereby agree upon an initial ownership allocation of the
System. Ownership allocation entitles each party to purchase water in volumes proportionate to that
allocation. In the event that Lake Oswego's permitted rights cannot be fully developed,Tigard.agrees to a
transfer of asset ownership to Lake Oswego in proportion to its water demands on an annual basis up to a
maximum of 23 MGD, Lake Oswego shall make an annual payment to Tigard based on the depreciated
replacement cost of the.assets being transferred. Payment shallbe in cash to the Member Utility receiving
payment for assets purchased.
21. Future Imorovements. Costs for improvements to System shall be allocated to
the Member Utilities on the basis of.their respective ownership allocation in the System in effect at the time
of the improvement.
22. Water Rights, Lake Oswego presently has several permits to appropriate the waters
of the State of Oregon for Municipal use. The City is permitted to appropriate up to 38 million gallons per
day (MGD) from the Clackamas River, 3.9 MGD from the Willamette River and 1.64 MGD from ground
water. These water permits are summarized in Exhibit "E" (To Follow) attached hereto and incorporated
herein by this reference. Water appropriated from run of river.sources within the terms of Lake Oswego's
existing permits will be dedicated for use to the benefit of the Member Utilities. However, no portion of
these existing permits shall be transferred to the Agency.
23. Existing Wholesale Customers, The Member Utilities shall be permitted to sell
treated water to their respective wholesale and retail customers which have been established prior to the
effective date of this Agreement and such sales shall not be subject to the terms of this section and shall be
considered as part of the water diverted into the separate systems of each Member Utility. A fist of the
existing wholesale/retail customers of each Member Utility is attached hereto as Exhibit "F", (To Follow).
Any sales of treated water to wholesale/retail customers not fisted in Exhibit "F must be approved by the
Agency. No agreement or understanding with .the customers listed in Exhibit "F" may be modified to
increase the volume of water committed or to alter the priority of service,without prior Agency approval.
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24. Purchases of Treated Water. Pursuant to the implementation date, each Member
Utility shall be obligated to purchase treated water from the Agency up to the then existing design capacity
of the System priorto the purchase of treated water fi+om other sources. Tigard shall be exempted from this
obligation for a period of not more than five years from the implementation date defined herein. .
25. Water Management an_d Conservation Plans. The Member Utilities agree that a Water
Management and Conservation Plan is necessary and is a priority and that such a plan will be developed by
each Member Utility and presented to the Board for adoption. The Member Utilities agree to exercise due
diligence in preparing such plans and to prepare said;plans in accordance with the guidelines of Oregon
Administrative Rules (OAR) Chapter 690,Division.86. Pursuant to adoption by the Board, said plans will
be presented to the Water Resources Department for approval. Such Water Management and Conservation
Plans shall be incorporated into this Agreement by reference.
26. Curtailment of Water Supply, The Member Utilities agree that at such times as
supplies of raw or treated water are insufficient to meet the water demands of the Member Utilities, each
Member Utility shall impose water management and conservation plans heretofore described and as
adopted by the Agency. In extreme cases of water supply deficiencies,the Board shall,in a timely manner,
,hold a special meeting to determine what additional,water curtailment measures will be adopted.
27. Emereency Water Sales. The Member Utilities agree that water system internes
with other water providers are a-critical component-of their respective distribution systems. The Member
Utilities further agree that water sold through these interties for emergency purposes shall take precedence
over water sold for its own customers and wholesale customers except that such emergency sales shall not
result in the creation of emergency conditions for the Member Utility. Costs of water sold through each
Member Utility's respective system interties shall be at the unit cost established in existing
intergovernmental cooperation agreements in force as of the implementation.date of this Agreement.
Member Utilities shall provide not less than six months notice to the Board of any.proposed new intertie(s)
to their respective distribution systems. The Board may at its discretion,disapprove any proposed intertie if
it is deemed not to be in the best interests of the Agency.
28. Water Sales During the Implementation Period. Pursuant to the effective date of
this Agreement and for a period-not to exceed three years, Lake Oswego agrees to sell water in excess of
Lake Oswego's water demands to the City of Tigard. Lake Oswego will endeavor during this period to
supply Tigard with an annual volume of water not less than the average volume of water purchased by
Tigard during the previous three years based upon usage records provided by Tigard. Tigard agrees that
during this same period, its water needs will be subordinate to those of Lake Oswego when surplus treated
water is not available. During this period, Lake Oswego reserves the right to adjust the price of surplus
water sold to Tigard to.reflectcurrent market conditions.
29. Periodic Review of IntergQvernmenW Ag=ment. Following creation of the Board,
it shall be established by a majority vote of the-Board, that a periodic review of this Agreement will be
performed. Board will determine the frequency,of such a review.
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30. Local Contract.Review Board, The Local Contract Review Board of the
Agency shall be the Agency's Board.
31. Contracting for Services. Initially the Agency shall contract with the City of
Lake Oswego to perform such duties required of the Agency by this Agreement. Bonding and/or insurance
requirements for such contract employees shall be provided by the respective Member Utility:' Bonding
and/or Insurance requirements for Manager, Secretary and Board members shallbe provided by the
Agency.
32. Eacnditures. No funds of the Agency shall be expended except upon the vote of the
Board and in furtherance of the purposes of the Board;except that expenditures within the limitations of the
Board approved budget may be made by the Manager. Additional authorized signatures shall include the
Chair,Vice Chair or Secretary in the event the Manager is unable to perform. The Board shall institute by-
laws to assure compliance with Local Budget Law.
33. Amendment Provisions. The terms of this Agreement may be amended for any
purpose including, without limitation, the addition or deletion of Member Utilities. Any such amendment
shall be in writing and shall refer specifically to this Agreement and shall be adopted by all the governing
bodies of the Member Utilities.
34. Termination andDissolution. This Agreement may be terminated upon ten (10) years
advance written notice by a vote of Ahe governing boards of the Member Utilities except when bonded debt
of the Agency is outstanding in which case the termination date shall coincide with the date that outstanding
bonds are fully repaid, whichever occurs later. Upon approval of termination by the Member Utilities, the
Chair of the Board shall direct that an accounting of assets and liabilities be conducted and,presented to the
Board and to the governing bodies of the respective Member Utilities. The Member Utilities shall
thereafter meet and agree upon an equitable distribution of any assets and liabilities, which may include a
reserve account for contingent,unliquidated or unforeseen liabilities or obligations. If'the Member Utilities
are unable to agree to the division of assets and liabilities, the Circuit Court of,Clackamas County shall
have jurisdiction to decide the issue. Tigard has separate intergovernmental agreements.,with,the Other
Utilities and under.the terms of those other agreements the Other Utilities could withdraw from their
present relationship with Tigard. In no event shall such a withdrawal by one or more of the Other Utilities
from their relationship with Tigard constitute an act of termination or dissolution of this Agreement.
35. Public Records and Meetings. The Agency shall comply-with all applicable
requirements of ORS Chapter 192 concerning public records and public meetings.
36. Compensation.Expenses. Compensation, if any, for members of the Board for
services provided as Board members in addition to reimbursement of actual and necessary travel and other
expenses incurred`in the performance of their duties,shall,be determined by the Agency.
Page 8. Intergovernmental Cooperation Agreement
TWDAGM.DOC
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37. Effective Date. This Agreement will be effective legally upon this execution
by the last Member Utility signing this agreement.
38. Written Notice Addresses. All written notices required under this Agreement shall
be sent to:
City of.Lake Oswego City of Tigard
City Manager City Administrator
PO Box.369 13125'SW Hall Blvd
Lake Oswego,OR 97034 Tigard,OR 97223.
39. Severability. If any provision of this Agreement shall be held to be invalid, illegal
or unenforceable, such invalidity, illegality or unenforceability shall not affect any other provisions of this
Agreement,but this Agreement shall be construed as if such invalid,illegal or unenforceable provisions had
never been contained herein.
40. Modification. No modification of this Agreement shall be valid unless in writing and
signed by the parties hereto.
41. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Oregon. Any action regarding this Agreement or the transactions
contemplated,hereby shall be brought in an appropriate court in the County of Clackamas,Oregon.
IN WI'T'NESS WHEREOF,the parties have set their hands on the dates shown below.
CITY OF LAKE OSWEGO CITY OF TIGARD
By: By:
Tide: Tide:
Date Signed: Date Signed:
Page 9. Intergovernmental Cooperation Agreement
WMAGM.WC
0414195
EXMBIT "D"
DRAFT
Pursuant to paragraph 10 of this Agreement,;major items of business shall be any Board action
involving,the following;
1.Issuance of Bonds for capital improvements.
2.Capital improvement projects exceeding$25,000.
3.Amendments to the Agreement.
4.Adding members to this Agreement.
5.Establishing systems development charges(SDC's).
6.Establishing water rates.
7.Adding new interties.
8.Curtailment of water supply.
9.Adoption and implementation of water management and conservation plans.
10.Physical asset,adjustment.
11.Addition or deletion of wholesale customers.
12.Review and approval of contracts for capital improvement projects and programs.
Exhibit"D"
Intergovernmental Cooperation.Agreement
T"AORMAoc
04p4A5 .
i
Oct 1AKE �!y
OREGON
CITY MANAGER'S OFFICE
22 December 1995
VIA FAX: 684-7297
Bill Monahan
City Administrator
City of Tigard
13125 SW Hall Boulevard
Tigard OR 97223
Dear Bill,
Thank you for your correspondence of 18 December regarding your calendar for
the next several weeks in regard to the scheduling of future discussions on water
matters. The Council has scheduled a study session for Wednesday,3 January,
at which time the topic will be the Master Utility Rate Report. The Council has
also scheduled an Executive Session following the presentation on utility rates to
provide staff policy guidance for discussions with the City of Tigard.
I will contact you after the Council meeting on 3 January so we may schedule a
time for our next session.
Happy l-Iol:days!
Very truly yours,
411,17
Douglas J. Schmitz
City Manager
DJS/sms
DEC 2 1995
� L; ki:
380"A"Avenue Post Office Box 369 Lake Oswego,Oregon 97034 • (503)635-0215 FAX(503)697-6594