The URL can be used to link to this page

Home My WebLink About2005-02-08 - Agendas - Final Aldermen Mayor Ma Dan Cood Ward I Position 1 - Robert Reynolds y y Ward I Position 2 - Brenda Thiel ddd v City Attorney Kit Williams Ward 2 Position I - Kyle B. Cook aYC Ward 2 Position 2 - Don Ma Ward 3 Position I - Robert K. Rho City Clerk Sondra Smith _ Marr 1 �! Ward 3 Position 2 — Bobby Ferrell ads ARKANSAS Ward 4 Position I - Shirley Lucas Ward 4 Position 2 - Lioneld Jordan _ Final Agenda Special City Council Meeting February 8, 2005 A Special meeting of the Fayetteville City Council will be held on February 8, 2005 at 6:00 p.m. in Room 219 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. Call to Order Roll Call Pledge of Allegiance A. Old Business: 1. OMI Contract Amendment No. 11 (A): A resolution approving Amendment No. 11 (A) to the contract with Operations Management International (OMI) in the amount of $76,693 . 10 for the acquisition of an electric generating unit; extending the term of the agreement for operations, maintenance and management services and additional five (5) years; and approving a budget adjustment transferring $76,693 .00 from Use of Fund Balance to PCP Operation Contract Fund. This resolution was tabled at the January 18, 2005 City Council Meeting to the February 1, 2005 City Council Meeting. This item was tabled at the February 1, 2005 City Council meeting to a Special City Council meeting on February 8, 2005. THE CITY COUNCIL VOTED TO REPLACE WITH AMENDMENT NO. 12. 2. OMI Contract Amendment No. 12 : A resolution approving Amendment No. 12 to the contract with Operations Management International (OMI); and approving a budget adjustment transferring $887,000.00 from Use of Fund Balance to the Wastewater Treatment Plant Generator Capital Project. PASSED AND SHALL BE RECORDED AS RESOLUTION NO. 21 -05. MEETING ADJOURNED AT 6: 10 P.M. 113 West Mountain 72701 (479) 521-7700 (479) 575-8257 (Fax) accessfayetteville.org Aldermen ' Ward I Position 1 - Robert Reynolds Mayor Dan Coody - Ward I Position 2 - Brenda Thiel Ci Attorney Kit Williams Ward 2 Position 1 - Kyle B. Cook City Y Ward 2 Position 2 - Don Marr Ward 3 Position I - Robert K. Rh City Clerk Sondra Smith Iraye i e/ Ward 3 Position 2 - Bobby Ferrell ads ARKANSAS Ward 4 Position I - Shirley Lucas Ward 4 Position 2 - Lioncld Jordan Final Agenda Special City Council Meeting February 8, 2005 A Special meeting of the Fayetteville City Council will be held on February 8, 2005 at 6:00 p.m. in Room 219 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. Call to Order Roll Call Pledge of Allegiance A. Old Business: 1. OMI Contract Amendment No. 11 (A): A resolution approving Amendment No. 11 (A) to the contract with Operations Management International (OMI) in the amount of $76,693. 10 for the acquisition of an electric generating unit; extending the term of the agreement for operations, maintenance and management services and additional five (5) years; and approving a budget adjustment transferring $76,693.00 from Use of Fund Balance to PCP Operation Contract Fund. This resolution was tabled at the January 18, 2005 City Council Meeting to the February 1, 2005 City Council Meeting. This item was tabled at the February 1, 2005 City Council meeting to a Special City Council meeting on February 8, 2005. 2. OMI Contract Amendment No. 12: A resolution approving Amendment No. 12 to the contract with Operations Management International (OMI); and approving a budget adjustment transferring $887,000.00 from Use of Fund Balance to the Wastewater Treatment Plant Generator Capital Project. City Council Meeting February 8, 211 • Subject: AT -frCf�4Utkt / ;L� Motion To: Motion By: Seconded: Reynolds Thiel Cook Marr ✓ Rhoads Ferrell ✓ I Lucas Jordan Mayor Coody Subject: Motion To: Motion By: Seconded: Reynolds Thiel Cook Marr Rhoads Ferrell Lucas Jordan Mayor Coody City Council Meeting February 8, 20 � �( G� Subject: Motion To: Motion By: Seconded: Reynolds Thiel Cook Marr Rhoads Ferrell Lucas ✓ Jordan Mayor Coody Subject: ( a 0 /� Motion To: � � l o) W �� Motion By: Seconded: Reynolds I Thiel ✓ Cook ✓ Marr �✓ Rhoads ✓ Ferrell Lucas Jordan Mayor Coody � � Aldermen Ward1 Position 1 - Robert Reynolds Mayor Dan Coody Ward 1 Position 2 - Brenda Thiel Ward 2 Position 1 - Kyle B. Cook City Attorney Kit Williams Ward 2 Position 2 - Don Mart City Clerk Sondra Smith Ward 3 Position 1 - Robert K. Rhoads Ward 3 Position 2 — Bobby Ferrell ARKANSAS Ward 4 Position 1 - Shirley Lucas Ward 4 Position 2 - Lioneld Jordan Final Agenda Special City Council Meeting February 8, 2005 A Special meeting of the Fayetteville City Council will be held on February 8, 2005 at 6:00 p.m. in Room 219 of the City Administration Building located at 113 West Mountain Street, Fayetteville, Arkansas. Call to Order Roll Call Pledge of Allegiance A. Old Business: 1. OMI Contract Amendment No. 11 (A): A resolution approving Amendment No. 11 (A) to the contract with Operations Management International (OMI) in the amount of $76,693.10 for the acquisition of an electric generating unit; extending the term of the agreement for operations, maintenance and management services and additional five (5) years; and approving a budget adjustment transferring $76,693.00 from Use of Fund Balance to PCP Operation Contract Fund. This resolution was tabled at the January 18, 2005 City Council Meeting to the February 1, 2005 City Council Meeting. This item was to at the February 1, 2005 City Council meeting to a Special City Council meeting on February 8, 2005. 2. OMI Contract Amendment No. 12: A resolution approving Amendment No. 12 to the contract with Operations Management International (OMI); and approving a budget adjustment transferring $887,000.00 from Use of Fund Balance to the Wastewater Treatment Plant Generator Capital Project. s • • City of Fayetteville A.1 . Staff Review Form OMI Contract Amendment No, 11 (A) Page 1 of 20 City Council Agenda Items Contracts 18-Jan-05 City Council Meeting Date Greg Boettcher Wastewater Treatment Water and Wastewater Submitted By Division Department Action Required: Resolution approving Amendment Number 11 (A) with Operations Management International, Inc. authorizing acquisition of an electric generation unit for the Noland Wastewater Plant and extension of the operating agreement for 5 years. A budget adjustment of $76,693. 10 is included for residual electric rate impacts for calendar year 2005 only, funds to come from use of fund balance and be added to Services and Charges. $76,693.10ater Treatement Plant/Services and Cost of this request Category/Project Budget Program Category / Project Name 540°.^9".9:499^ o� $ Use of Fund Reserves Account Number Funds Used to Date Program / Project Category Name $ Water and Sewer Project Number - Remaining Balance Fund Name Budgeted Item E�xl Budget Adjustment Attached Y" Previous Ordinance or Resolution # !2 -20 fir/ Depa ent Director Date Original Contract Date: 1 -Sep-94 Original Contract Number: 1�0 City Attorney Date Received in Mayor's Office l�hiet�Atirr`(ititstraifi OTfcer Date F. rL.4cMrcPbu +r Received in City Clerk's Office ,o Mayor Date Comments: N �I1 i,.iL A.1 . Ye e _. OMI Contract Amendment No,Page 21oft20 L City Council Meeting of January 18, 2005 CITY COUNCIL AGENDA MEMO To Mayor and City Council From: Greg Boettcher, Water/Wastewater Director Date: December 22, 2004 Subject: Resolution approving Amendment Number 11 (A) with Operations Management International, Inc. authorizing acquisition of an electric generation unit for the Noland Wastewater Plant and extension of the operating agreement for 5 years. A budget adjustment of $76,693. 10 is -II. included for residual electric rate impacts for calendar year 2005 only, funds to come from use of fund balance and to be added to Watewater Treatment Plant Program/Services and Charges. 'll RECOMMENDATION Fayetteville City Administration recommends approval of "Amendment No. 11 (A) to the Agreement for Operations, Maintenance and Management Services for the City of Fayetteville, Arkansas Wastewater Treatment Plant." This contract amendment increases the 2005 contract value by $76,693.10 to cover the residual electric rate effects for calendar year 2005. This amendment increases the 2005 contract to a total of $43561 ,018. 10. BACKGROUND Final design of the Noland Wastewater Plant Improvements includes the installation of a second standby electric generating unit at a cost of approximately $350,000.00 to handle the increased needs of the facility. An opportunity has been discovered whereby the City can acquire a larger backup electric generation unit that enables lowered electric costs by nature of load management capabilities. Energy cost savings are such that the City can recover the principal and interest payments from energy cost savings provided that the equipment is financed over a five year term. At the end of this five-year payback period; all energy costs savings will be captured by the City of Fayetteville plus the City shall have acquired a self-funded equipment asset. This concept has multiple applications within the Fayetteville Wastewater System Improvements Project, as standby electric generating units have been designed for both the new West Side Wastewater Treatment Plant and for the new Hamestring Lift Station. The Noland Plant's application is simply the first to be released for bids; hence the current desire to move forward with this activity. In order to minimize the electric generation system costs, coordinate load management practices, secure buy-in from plant operations and meet tight time schedules; it is proposed to .use a contract amendment with OMI to secure the financing, planning, installation and operation of the Noland Generator Project. While the Noland Generator Project will be self-funding once the new rates are in effect; theme is a residual energy cost impact that represents a one-time, up front project expenditure. This initiation cost is due to the fact that electric load management in 2005 will not impact electric charges until the start of 2006, therefore, the first year costs must r 6WL*,/may al* a/,1os , glasmt� A.I . OMI Contract Amendment No, 11 (A) ye _.,1,Je Page 3 of 20 City Council Meeting of January 18, 2005 adjust for this startup expense. This rate residual impact is predicted at $76,693.10 for 2005; hence the increase in OMI's contract value and the associated budget adjustment. DISCUSSION Fayetteville has a narrow window of opportunity to simultaneously capture capital cost savings and operating cost savings. The acquisition of load management electric generating equipment for its wastewater treatment facilities has predicted capital cost savings of $1 .75 million ($350,000 at Noland, $1 ,000,000 at West Plant and $400,000 at Hamestring). The.use of OMI contract amendments to acquire, finance and repay such costs provides. Fayetteville with the ability to capture the energy costs savings at the end of the 5-year repayment period, equating to reduced operating costs over time. With the Noland Wastewater Project's Contract EP-2 scheduled for a bid opening on February 15, 2005; it is desirable to finalize this decision to enable issuance of an addendum deleting the proposed smaller standby power system. BUDGETIMPACT The contract amendment increases the OMI contract value by $76,693. 10 in 2005 and will require a budget adjustment to transfer said amount from use of water and sewer fund balance. This one-time implementation expense offers an immediate capital cost savings of $350,000.00 plus operating costs savings after retiring the 5-year equipment financing. ii A.1 . OMI Contract Amendment No, 11 (A) Page 4 of 20 i RESOLUTION NO. i A RESOLUTION APPROVING AMENDMENT NO. 11 (A) TO THE CONTRACT WITH OPERATIONS MANAGEMENT INTERNATIONAL (OMI) IN THE AMOUNT OF $76,693.10 FOR I THE ACQUISITION OF AN ELECTRIC GENERATING UNIT; j EXTENDING THE TERM OF THE AGREEMENT FOR I OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES AN ADDITIONAL FIVE (5) YEARS; AND APPROVING A BUDGET ADJUSTMENT TRANSFERRING $76,693.00 FROM USE OF FUND BALANCE TO PCP OPERATION CONTRACTFUND. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1. That the City Council of the City of Fayetteville, Arkansas hereby approves Amendment No. 11 (A) to the contract with Operations Management International (OMI) in the amount of $76,693.10. A copy of Amendment No. 11 (A), marked Exhibit "A" is attached hereto, and made a part hereof. j Section 2. That the City Council of the City of Fayetteville, Ar ax ' s hereby agrees to extend the Agreement for Operations, Ma' ad Management Services an additional five (5) years. ` Section 3. That the City Council of the Ci Faye eville, . kansas hereby approves a budget adjustment tra ferring $7 . 3.00" om Us ,.. If Fund Balance to PCP Operation Contract Fund. p I PASSED and APPRO E 81b day = � ary 200 Y RO ' 3 By: DAN COODY, Mayor A *`Y B : SONDRA SMITH, City Clerk City of Fayetteville, Arkansas Budget Adjustment Form q t Budget Year Department: Water & Wastewater Date Requested rustrRAIPAMrilkr 2004 Division: Wastewater Treatment Program: Wastewater Treatment Plant 12/22/2004 Project or Item Requested: Project or Item Deleted: Adjust wastewater plant operations budget by $76,693. 10 will be the Use of Fund Balance. $76,693. 10 for amendment 11 (A) relating to the acquisition and financing of a generator system for the Noland Wastwater Plant. Adjustment is for the one-time residual electric rate impacts in calendar year 2005 Justification of this Increase: Justification of this Decrease: This expenditure is the upfront expense to initiate a self- This investment in equipment and future savings is a cost- funding equipment acquistion that has benefits of effective use of water and sewer funds. Sufficient funding $350,000 capital project cost savings, 5-year financing remains to comply with City Policy. thru electric energy savings and direct energy cost savings to City after 5-year repayment period. Increase Budget (Decrease Revenue) Account Name Account Number Amount Project Number PCP operation contract 5400 5100 5328 00 76,693 Decrease Budget (Increase Revenue) - Account Name Account Number Amount Project Number - Use of fund balance 5400 0940 4999 99 76,693 Approval Signatures Budget Office Use Only Type: A B C / E/ E Requested B Date �/ TLd Date of Approval udget anage Date - Initial Dale Id? 20 '25�q Posted to General Ledger DepK tment Director Date Initial Dale —� 2 - Posted to Project Accounting - Financ & Inteji Services hector D to Initial Date . Entered in Category Log Mayor - Date Initial Date it A.1 . OMI Contract Amendment No, 11 (A) AMENDMENT NO. 11 (A) Page 6 of 20 TO AGREEMENT FOR OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES d� FOR THE CITY OF FAYETTEVILLE, ARKANSAS WASTEWATER TREATMENT PLANT '11 THIS AMENDMENT NO. 11 (A) to the Agreement for Operations, Maintenance and Management Services for the ICity of Fayetteville, Arkansas Wastewater Treatment Plant dated September 1 , 1994 (the "Agreement"), made effective on the 1u day of January, 2005, by and between the City of Fayetteville, Arkansas, whose address for any formal notice is 113 W. Mountain St, Fayetteville, Arkansas 72701 (hereinafter the 'City") and Operations Management International, Inc., with offices at 9193 S. Jamaica Street, Suite 400, Englewood, Colorado 80112 .(hereinafter "OMI") is made and entered into for purposes of amending certain provisions of the Agreement, to prevent the facilities covered by the Agreement from being deemed to be used in the trade or business of OMI pursuant to Section 141 (b) of the Internal Revenue Code of 1986, as amended. NOW THEREFORE, the City and OMI agree to amend the Agreement as follows: i 1 . Article 4.3 is hereby deleted in its entirety and replaced with the following Article 4.3: ij 4.3 OMI estimates the cost for services for calendar year 2005 shall be Four Million Five Hundred Sixty One Thousand Eighteen Dollars ($4,561 ,018.00). Details of said cost are shown in Appendix J. The base fee shall be negotiated each year in September for the upcoming calendar year. Should the City and OMI fail to agree, the base fee will be l determined by the application of the base fee adjustment formula shown in Appendix F. Should the actual expenditures exceed estimated expenditures by more than Twenty Thousand Dollars ($20,000), in any year of this Agreement, specific approval will be obtained from the City prior to OMI incurring additional costs. 2. Article 7.1 is hereby deleted in its entirety and replaced with the following Article 7.1 : 117.1 This initial term of this Agreement shall be five (5) years and four (4) months commencing on September 1 , 1994 and ending on December 31 , 1999, followed by two (2) successive five (5) year options, each renewable at the sole discretion of OMI. The City has exercised its options to extend through December 31 , 2008. In consideration of OMI's agreement to fund the Power Generator Project at the Noland WWTP, described in Appendix L, the City is hereby extending this Agreement through and including December It 31 , 2013. II . 3. IA new Appendix L is added in the form attached hereto. This Amendment No. 11 (A) together with the Agreement constitutes the entire agreement between the Parties !and supersedes all prior oral and written understandings with respect to the subject matter set forth herein. Unless specifically stated all other terms and conditions of the Agreement shall remain in full force and effect. Neither this Amendment nor the Agreement may be modified except in writing signed by an authorized representative of the Parties. I Page 1 of 6 a A.I . OMI Contract Amendment No, 11 (A) Page 7 of 20 The Parties, intending to be legally bound, indicate their approval of the Amendment by their signatures below. OPERATIONS MANAGEMENT CITY OF FAYETTEVILLE INTERNATIONAL, INC. Roger B. Quayle Dan Coody Senior Vice President Mayor Date: Date:. Page 2 of 6 I,I A.1. OMI Contract Amendment No, 11 (A) Page 8 of 20 i Appendix J I COST DETAIL The annualized estimated costs for calendar year 2005 are as follows: l Description Existing 2005 Amended 2005 Estimated Costs Estimated Costs Direct Labor & Benefits $ 19671 ,071 .00 $ 11671 ,071 .00 Labor Markup $ 501 ,321 .00 $ 501 ,321 .00 Electricity $ 642,720.00 $ 588,480.00 Electrical Markup $ - $ - Other Direct Costs $ 11288,073.00 $ 1 ,304,771 .00 Other Direct Costs Markup $ 128,807.00 $ 1309477. 10 Subtotal $ 41231,992.00 $ 4,196,120.10 Fixed Fee $ 62,349.00 $ 81 ,651 .00 Lift Station Odor Control $ 69,382.00 $ 69,362.00 Capital Item Amortization $ 100,622.00 $ 1009622.00 Power Generator Project Equipment Amortization $ $ 113,263.00 Total Est. O & M Budget $ 41,484,325.00 $ 41561 ,018.10 Total Est. Annualized Budget $ 4,484,325.00 $ 41561 ,018. 10 Estimated Increase $ 76,693.10 The following are some of the major reasons for cost circumstances: 1 . Continued increase in the efficient use of technological automation and job-sharing within the ON network. 2 °Continued upward pressure on the cost of fuel and vehicle expenses. i 3. Ever increasing cost to maintain community-expected high level of performance with many pieces of equipment nearing the end of their life cycle and destined to be replaced or upgraded as part of the ongoing Wastewater Improvement Project. 4. ,.Continued population growth causing a related increase in sludge production and ultimate sludge !'disposal costs. 5. !'Additional costs for maintenance of 4-5 new sewage lift stations during the next year. i 6. I.Potentially less expensive sludge disposal alternatives continue to be evaluated, which may or may not become feasible within the next 12 months. 7. !Addition of the Power Generator Project as described in Appendix L hereto. I� Page 3 of 6 A.1 . OMI Contract Amendment No, 11 (A) Appendix L Page 9 of 20 POWER GENERATOR PROJECT - SCOPE OF WORK Due to significantly increased emphasis on preventing all possible wastewater overflows and/or interruptions in wastewater treatment capability by the Arkansas Department of Environmental Quality and the United States Environmental Protection Agency, as well as currently available favorable electrical rate structures it has become necessary for the City to install full-backup power generation equipment at the Paul R. Noland wastewater treatment plant (WWTP). In addition, the City anticipates installing full-backup power generation equipment at the new Westside WWTP facility and at the expanded Hamestring sewer lift station facility in accordance with the respective construction sequencing as these facilities are constructed. The cost of the power generation equipment (the "Equipment") to effect the implementation of the power generation system at the Noland WWTP is $715,000. OMI hereby agrees to locate, procure and finance the cost of the Equipment at an annual interest rate of seven percent over the course of sixty (60) months on behalf of the City in accordance with the amortization schedule set forth in Attachment 1 to this Appendix L and the City hereby agrees that it will purchase the Equipment from OMI over the course of such sixty (60) month period (the "Amortizafion Period"). The City's first payment to OMI will be due in the month following the installation complete date, currently estimated to be May 15, 2005. The City may elect to complete purchase of the Equipment at any time during the Amortization Period without incurring any early payment penalties. . Copies of purchase orders, bills of sale or invoices evidencing OMI's purchase will be furnished to the City upon request. Title and risk of loss to the Equipment will remain with OMI at all times during the Amortization Period. At the end of the Amortization Period, title and risk of loss for and to the Equipment will transfer to the City. If for any reason the Agreement is terminated by either party prior to the end of the Amortization Period, the City will pay to OMI the remaining balance due, in full, within thirty (30) days following termination. In the event the City refuses to or fails to make payment within thirty (30) days following termination OMI may exercise all rights available .to it, including but not limited to, removal of the Equipment from the Noland WWTP. OMI may sell or assign this Amendment 11 (A) and the Equipment to a third party in its sole discretion at any time during the Amortization Period. Costs for diesel fuel will be provided directly by the City of Fayetteville as described in Article 3.8 of this Agreement. Costs for natural gas, applicable taxes, insurance, maintenance, and monitoring fees will be included in the actual cost of services as shown in Appendix J, and costs for these items in subsequent years during the Term will be provided to the City in accordance with the provisions of the Agreement. The parties agree that they intend to install power generation systems at the new Westside WWTP and the expanded Hamestring sewer lift station at the appropriate time during the construction sequencing for each of these facilities, and that they intend to amortize the cost of each of these systems over a five year period. The parties will amend this Appendix L as necessary to address the terms and conditions agreed upon with respect to the power generation systems to be installed at the Westside WWTP and the Hamestring sewer lift station. Page 4 of 6 �i A.1 . OMI Contract Amendment No, 11 (A) Attachment 1 to Appendix L Page 10 of 20 - I AMORTIZATION SCHEDULE LOAN DATA TABLE DATA iI Loan amount 95 00000 Table starts at date: �i Annual interest rate ,7 OOyk r4,,. or at payment number: 1° � �.va Term in years 5., I� Payments per year 72€N!.,xeztti� '; First payment due S/1f2005 F's {sf" PERIODIC PAYMENT Entered payment u Calculated payment $ti4' 1S7E86E . CALCULATIONS I Use payment of F'z t $14 AS7+ 86f Beginning balance at payment 1 : i9ra xY415 000�'00ii 1 st payment in table �!�,..�t ,_ Cumulative interest prior to payment L4 <r „ "n$'0 00; li Payment Beginning - Ending Cumulative No. Date Balance Interest Principal Balance Interest - 1 1 5/1/2005 715,000.00 4,170.83 9,987.02 705,012.98 4,170.83 2 6/1/2005 705,012.98 40112.56 10,045.28 694,967,70 8,283.41 3 7/1/2005 694,967.70 4,053.98 , 10,103.88 684,863.82 120337.39 4i'. 8/1/2005 684,863.82 3,995.04 10,162.82 674,701 .00 16,332.43 5 9/1/2005 674,701 .00 3,935.76 10,222.10 664,478.90 20,268.18 6 10/1/2005 664,478.90 3,876.13 10,281 .73 654,197.17 24,144.31 7 11/1/2005 654,197.17 3,816.15 10,341 .71 643,855.46 27,960.46 8 12/1/2005 643,855.46 3,755.82 10,402.03 633,453.43 310716.28 9 '! 11112006 633,453.43 3,695.14 10,462.71 622,990.71 35,411 .43 10 ail 2/1/2006 622,990.71 3,634.11 10,523.74 612,466.97 39,045.54 11 311/2006 612,466.97 3,572.72 10,585.13 - 601 ,861 .84 42,618.26 12 4/1/2006 601 ,881 .84 3,510.98 10,646.88 591 ,234.96 46,129.24 13 •:5/1/2006 591 ,234.96 3,448.87 10,708.99 580,525.97 49,578.11 14 6/1/20D6 580,525.97 3,386.40 10,771 .46 569,754.52 52,964.51 15 7/112006 569,754.52 3,323.57 10,834.29 558,920.23 56,288.08 16 8/1/2006 558,920.23 31260.37 10,897.49 548,022.74 59,548.45 17 9/1/2006 548,022.74 3,196.80 10,961 .06 537,061 .68 62,745.25 18 10/1/2006 537,061 .68 3,132.86 11 ,025.00 526,036.68 65,878.11 19 11/1/2006 526,036.68 3,066.55 11 ,089.31 514,947.37 68,946.66 20 12/1/2006 514,947.37 3,003.86 11 ,154.00 503,793.38 71 ,950.52 21 'Il 1/1/2007 503,793.38 2,938.79 110219.06 492,574.31 74,889.31 22 ,ii 2/1/2007 492531 2,873.35 11 ,284.51 481 ,289.81 77,762.66 3/1200 . 23 ,28981 2,807.52 11 ,350.33 469,939.47 80,570.18 24 4/1/2007 469.939.47 2,741 .31 11 ,416.54 458,522.93 83,311 .50 u Page 5 of 6 Al . OMI Contract Amendment No, 11 (A) Page 11 of 0 25 5/1/2007 458,522.93 2,674.72 11 ,483.14 447,039.79 85,986.22 26 6/1/2007 447,039.79 2,607.73 11 ,550.12 435,489.67 88,593.95 27 7/1/2007 435,489.67 2,540.36 11 ,617.50 423,872.17 91 ,134.30 28 8/1/2007 423,872.17 2,472.59 11 ,685.27 412,185.90 93,606.89 29 9/1/2007 412,186.90 2,404.42 11 ,753.43 400,433.46 96,011 .31 30 10/1/2007 400,433.46 2,335.86 11 ,822.00 388,611 .47 98,347.18 31 11/1/2007 388,611 .47 2,266.90 11 ,890.96 376,720.51 100,614.08 32 12/1/2007 376,720.51 2,197.54 11 ,960.32 364,760.19 102,811 .61 33 1/1/2008 364,760.19 . 2,127.77 12,030.09 352,730.10 104,939.38 34 2/1/2008 352,730.10 2,057.59 12,100.26 340,629.84 106,996.97 35 3/1/2008 340,629.84 1 ,987.01 12,170.85 328,458.99 108,983.98 36 4/1/2008 328,458.99 1 ,916.01 12,241 .85 316,217.14 110,899.99 37 5/1/2008 316,217.14 1 ,844.60 12,313.26 303,903.88 112,744.59 38 6/1/2008 303,903.88 1 ,772.77 12,385.08 291 ,518.80 114,517.36 39 7/1/2008 291518.80 1 ,700.53 12,457.33 279,061 .47 116,217.89 40 8/1/2008 279,061 .47 1 ,627.86 12,530.00 266;531 .47 117,845.75 41 9/1/2008 266,531 .47 1 ,554.77 12,603.09 253,928.38 119,400.52 42 10/1/2008 253,928.38 1 ,481 .25 12,676.61 241 ,251 .77 1 120,881 .76 43 11/1/2008 241 ,251 .77 1 ,407.30 12,750.55 228,501 .22 122,289.07 44 12/1/2008 228,501 .22 1 ,332.92 12,824.93 215,676.28 123,621.99 153 1/1/2009 215,676.28 1 ,258.11 12,899.75 202,776.54 124,880.10 2/1/2009 . 202,776.54 1 ,182.86 12,974.99 189,801 .55 126,062.97 3/1/2009 189,801 .55 1 ,107.18 13,050.68 176,750.86 127,170.14 - 4/1/2009 176,750.86 1 ,031 .05 13,126.81 163,624.05 128,201 .19 5/1/2009 163,624.05 954.47 13,203.38 150,420.67 1291155.66 6/1/2009 150,420.67 877.45 13,280.40 137,140.27 130,033.12 7/1/2009 137,140.27 799.98 13,357.87. 123,782.40 130,833.10 8/1/2009 123,782.40 722.06 13,435.79 110,346.60 131 ,555.16 9/1/2009 110,346.60 643.69 13,514.17 96,832.43 132,198.85 54 10/1/2009 96,832.43 564.86 13,593.00 83,239.43 132,763.71 55 11/1/2009 83,239.43 485.56 13,672.29 69,567.14 133,249.27 56 12/1/2009 69,567.14 405.81 13,752.05 55,815.09 133,655.08 57 1/1/2010 55,815.09 325.59 139832.27 41 ,982.82 133,980.67 58 2/1/2010 41 ,982.82 244.90 13,912.96 28,069.86 134,225.57 59 3/1/2010 28,069.86 -- ' 163.74 13,994.12 14,075.75 134,389.31 60 4/1/2010 14,075.75 82.11 14,075.75 0.00 134,471 .42 Page 6 of 6 II A.1 . OMI Contract Amendment No, 11 (A) �I Page 12 of 20 le ayve eirl e ARKANSAS ii WATER AND WASTEWATER DIVISION DEPARTMENTAL CORRESPONDENCE TO; Mayor and City Council I FROM: Matt Taylor, P.E. µ%Jor Burns & McDonnell 0 DATE: January 11, 2005 RE: Revised Copy of Amendment 11A i OMPs Contract Attached is a slightly revised copy of Amendment 11A to OMI's contract with the City. The I. primary changes are listed below with a brief explanation of each. it '; 1 . The total contract amount for calendar year 2005 has been increased ' approximately $8,400 (0. 18% of total) to $4,569,412.89 due primarily to corrections to sales tax estimates and the addition of an extended warranty for l the generator proposed at the Noland Treatment Facility. II 2. The interest rate has not changed, but it is described in the revised contract in terns of the prime rate plus 2%. 3. Sales tax and the four-year extended warranty (5 years total) are addressed in the revised contract text. III 4. OMI removed text that gave them the right to sell or assign the work included in ISIAmendment 11A. The revisions to Amendment 11 A are appropriate and reflect OMI's efforts to be as accurate as possible. My recommendation is to approve the revised contract amendment as submitted. j� it I. A.I . OMI Contract Amendment No, 11 (A) Page 13 of 20 AMENDMENT NO. 11(A) TO AGREEMENT FOR OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES FOR THE CITY OF FAYETTEVILLE, ARKANSAS WASTEWATER TREATMENT PLANT THIS AMENDMENT NO. 11(A) to the Agreement for Operations, Maintenance and Management Services for the City of Fayetteville, Arkansas Wastewater Treatment Plant dated September 1 , 1994 (the "Agreement"), made effective on the 15' day of January, 2005, by and between the City of Fayetteville, Arkansas, whose address for any formal notice is 113 W. Mountain St, Fayetteville, Arkansas 72701 (hereinafter the "City") and Operations Management International, Inc., with offices at 9193 S. Jamaica Street, Suite 400, Englewood, Colorado 80112 (hereinafter "OMI") is made and entered into for purposes of amending certain provisions of the Agreement, to prevent the facilities covered by the Agreement from being deemed :to be used in the trade or business of OMI pursuant to Section 141 (b) of the Internal Revenue Code of 1986, as amended. NOW THEREFORE, the City and OMI agree to amend the Agreement as follows: 1 . Article 4.3 is hereby deleted in its entirety and replaced with the following Article 4.3: 4.3 OMI estimates the cost for services for calendar year 2005 shall be Four Million Five Hundred Sixty Nine Thousand Four Hundred Twelve Dollars and Eighty-Nine Cents ($4,569,412.89). Details .of said cost are shown in Appendix J. The base fee shall be negotiated each year in September for the upcoming calendar year. Should the City and OMI fail to agree, the base fee will be determined by the application of the base fee adjustment formula shown in Appendix F. Should the actual expenditures exceed estimated expenditures by more than Twenty Thousand Dollars ($20,000), in any year of this Agreement, specific approval will be obtained from the City prior to OMI incurring additional costs. 2. Article 7.1 is hereby deleted in its entirety and replaced with the following Article 7.1 : 7.1 This initial term of this Agreement shall be five (5) years and four (4) months commencing on September 1 , 1994 and ending on December 31 , 1999, followed by two (2) successive five (5) year options, each renewable at the sole discretion of OMI. The City has exercised its options to extend through December 31 , 2008. In consideration of OMI's agreement to fund the Power Generator Project at the Noland WWTP, described in Appendix L, the City is hereby extending this Agreement through and including December 31 , 2013. 3. A new Appendix L is added in the form attached hereto. This Amendment No. 11 (A) together with the Agreement constitutes the entire agreement between the Parties and supersedes all prior oral and written understandings with respect to the subject matter set forth herein. Unless specifically stated all other terms and conditions of the Agreement shall remain in full force and effect. Neither this Amendment nor the Agreement may be modified except in writing signed by an authorized representative of the Parties. Page 1 of 6 A.1 . OMI Contract Amendment No, 11 (A1 !i Page 14 of 2 The Parties, intending to be legally bound, indicate their approval of the Amendment by their signatures below. OPERATIONS MANAGEMENT CITY OF FAYETTEVILLE INTERNATIONAL, INC. {I Roger B. Quayle Dan Coody Senior Vice President Mayor Date: 11 Date: 1! i Page 2 of 6 A.I . OMI Contract Amendment No, 11 (A) Page 15 of 20 Appendix J COST DETAIL The annualized estimated costs for calendar year 2005 are as follows: Description Existing 2005 Amended 2005 Estimated Costs Estimated Costs Direct Labor & Benefits $ 1 ,671 ,071 .00 $ 1 ,671 t071 .00 Labor Markup $ 501 ,321 .00 $ 501 ,321 .00 Electricity $ 642,720.00 $ 5883480.00 Electrical Markup $ $ Other Direct Costs $ 1 ,288,073.00 $ 1 ,305,526.74 Other Direct Costs Markup $ 1283807.00 $ 130,552.67 Subtotal $ 4,231 ,992.00 $ 4,1969951 .41 Fixed Fee $ 82,349.00 $ 810667.16 Lift Station .Odor Control $ 693362.00 $ 69,362.00 Capital Item Amortization $ 1003622.00 $ 1000622.00 Power Generator Project Equipment Amortization $ $ 120,810.32 Total Est. O & M Budget $ 41484,325.00 $ 4,569,412.89 Total Est. Annualized Budget $ 414843325.00 $ 4,5692412.89 Estimated Increase $ 85,087.89 The following are some of the major reasons for cost circumstances: 1 . Continued increase in the efficient use of technological automation and job-sharing within the OMI network. 2. Continued upward pressure on the cost of fuel and vehicle expenses. 3. Ever increasing cost to maintain community-expected high level of performance with many pieces of equipment nearing the end of their fife cycle and destined to be replaced or upgraded as part of the ongoing Wastewater Improvement Project. 4. Continued population growth causing a related increase in sludge production and ultimate sludge disposal costs. 5. Additional costs for maintenance of 4-5 new sewage lift stations during the next year. 6. Potentially less expensive sludge disposal alternatives continue to be evaluated, which may or may not become feasible within the next 12 months. 7. Addition of the Power Generator Project as described in Appendix L hereto. Page 3 of 6 I I A.1 . OMI Contract Amendment No, i t (A) Page 16 of 20 Appendix L POWER GENERATOR PROJECT - SCOPE OF WORK Due to significantly increased emphasis on preventing all possible wastewater overflows and/or interruptions in wastewater treatment capability by the Arkansas Department of Environmental Quality and the United States Environmental Protection Agency, as well as currently available favorable electrical rate structures it has become necessary for the City to install full-backup power generation equipment at the Paul R: Noland wastewater treatment plant (WWTP). In addition, the City anticipates installing full-backup power generation equipment at the new Westside WWTP facility and at the expanded Hamestring sewer lift station facility in accordance with the respective construction sequencing as these facilities are constricted. i The City has reviewed available options and has determined that it desires to install a power generation system manufactured by PowerSecure, Inc. The cost of the power generation equipment (the "Equipment") to effect the implementation of the power generation system at the Noland WWTP, including applicable sales taxes and a four-year extended warranty, is estimated to be $762,645.00. OMI hereby agrees to procure and finance the cost of the Equipment at an annual interest rate of prime plus two percent (2%), currently seven percent (7%) over the course of sixty (60) months on behalf of the City in accordance with the amortization schedule set forth in Attachment 1 to this Appendix L and the City hereby agrees that it will purchase the Equipment from OMI over the course of such sixty (60) month period (the "Amortization Period"). The City's first payment to OMI will be due in the month following the installation complete date, currently estimated to be May 15, 2005. The City may elect to complete purchase of the Equipment at any time during the Amortization Period without incurring any early payment penalties. OMI makes no representations or warranties to the City with respect to the Equipment nor does it make any representations with respect to the savings the City may realize following installation of the Equipment. OMI shall pass through to the City any warranties provided by PowerSecure, but shall have no other responsibility for the manufactured quality of the generators. Copies of purchase orders, bills of sale or invoices evidencing OMI's purchase will be furnished to the City upon request. Title and risk of loss to the Equipment will remain with OMI at all times during the Amortization Period. At the end of the Amortization Period, title and risk of loss for and to the Equipment will transfer to the City. If for any reason the Agreement is terminated by either party prior to the end of the Amortization Period, the City will pay to OMI the remaining balance due, in full, within thirty (30) days following termination. In the event the City refuses to or fails to make payment within thirty (30) days following termination OMI may exercise all rights available to it, including but not limited to, removal of the Equipment from the Noland WWTP. OMI may sell or assign this equipment purchase to a third party in its sole discretion at any time during the Amortization Period. ( Costs for diesel fuel will be provided directly by the City of Fayetteville as described in Article 3.8 of this .Agreement. Costs for natural gas, applicable taxes, insurance, maintenance, and monitoring fees will be included in the actual cost of services as shown in Appendix J, and costs for these items in subsequent years during the Term will be provided to the City in accordance with the provisions of the Agreement. The parties agree that they intend to install power generation systems at the new Westside WWTP and the expanded Hamestring sewer lift station at the appropriate time during the construction sequencing for each of these facilities, and that they intend to amortize the cost of each of these systems over a five year period:.The parties will amend this Appendix L as necessary to address the terms and conditions agreed upon with respect to the power generation systems to be installed at the Westside WWTP and the Hamestring sewer lift station. Page 4 of 6 A.1 . OMI Contract Amendment No, 11 (A) Page 17 of 20 Attachment 1 to Appendix L ESTIMATED AMORTIZATION SCHEDULE LOAN DATA - TABLEDATA Loan amountM '84t90;� _ Table starts at date — } Annual ingest rate: 700%. . = or at paymentnumber ! 1 . Tenn in years: 5 Payments Per Year. 12 First payment due: 5112005 . PERIODIC PAYMENT . .....,.,.._... Entered payment'. Calculated payment; $15,10729', CALCULATIONS Use payment oE� $15101.29- Beginning balanceat payment ! $762;605.00.• lst payment in tab a Cumulative interest prior to payment l ` 7 ._y$0.00 MM, 31111111ww" Payment Beginning Endng Cumulative No. Date Bace lanInterest PrincipalBalance Interest 1 SIMM5 762,64.5.00 4,448.76 10,65252 751,992.48 4,448.76 2 012005 751,992.48 4,386.62 10,714.66 741,277.82 8,835.39 . 3 7!12005 741,277.82 4,324.12 10,777.16 730,500.65 13,159.51 4 8112005 730,500.65 4,26125 10,840.03 719,660.62 17,420.76 5 8112005 719,660.62 4,198.02 10.90326 708,757.35 21,616.78 6 10112005 708,757.35 4,134.42 10,966.87 697,790.49 25,753.20 7 11/12005 697,790.49 4,070.44 11,030.84666,759.6.5 29,823.64 8 12/12005686,759-65 4,006.10 11,095.19 675,664.46 33,829.74 . . . 9 1/12006 675,664.46 3,941.38 11,159.91 664,504.55 37,771.12 10 2/12006 654,504.55 3,87628 11.225.01 653,279.54 41,647.39 11 3(12006 653279.54 3,810.80 11,290.49 641,989.05 45,458.19 12 4/1/20004 641,989.05 3,744.94 11,35635 630,632.71 49,203.13 13 5112006 630,63271 3,678.69 11,422.59 619,210.11 52,881.82 14 UW006 619,210.11 3,612.06 11,48923 607,720.89 56,493.86 15 7/12006 607,720.69 3,545.04 11,55625 596,164.64 60.038.91 16 &12006 596,164.64 3,477.63 11,623.66 564,540.98 63,516.54 17 9112006 584,540.98 3,409.82 11,691.46 572,849.52 6Q92636 - 18 10112006 572,649.52 01341.62 11,759.66 561,089.8670,267.99 19 11112006 561,089.86 3,273.02 11,82825 549261.59 73,541.01 20 12/l/M 549,251.59 3,204.03 11,697.25 537,364.34 76,745.04 21 1/120D7 537,364.34 3,134.63 11,966.65 525,397.66 79,879.66 22 2/10107 525,397.68 3,064.82 12,036.47 513,361.21 82,944.48 23 3112007 513,361.21 2,994.61 12,106.68 501,254.53 85,939.09 24 4712007 501,254.53 2,923.98 12177.30 489,077.23 88,86307 25 5112007 489,07723 2,852.95 12,248.33 476,828.90 91,71802 . . 26 6112007 476,828.90 2,781.50 12,319.78 464,509.11 94,497.53 27 7112007 464,509.11 2,709.64 12,691.65 452,117.47 97,207.16 28 81112007 452,117.47 2,637.35 12,463.93 439,653.53 99,844.51 29 8112007 439,693.53 2,564.6.5 12,536.64 427,116.69 102,409.16 30 10112007 427,116.89 2,491.52 12,609.77 414,507.12 104,900.67 Page 5 of 6 i 1 A.1 . OMI Contract Amendment No, 11 (A) Page 18 of 20 LOAN DATA TABLE DATA Loan amounL 762,645100,,,,9 Table starts at date Armual interest rate: 7 00°,5 ` oral paymentnumber 1 Tem in years: 5 P ments per year. 12 _ Ili Frslpayrn dux . 'PERIODIC PAYNENT Entered paymert:3 _g nr _ !, Calaealed payment Lq $15;101291 CALCULATIONS Use payment of. $15101 29; Beginning balance at payment 1::t $762 645'00, . . 'Inst payment in tablx l,.-.� m.. . ai.�� . . OxnAa6veunterestpriorto 11'1 ' IP'ilu-;c lth'1l 'i„$000. II Payment Beginning Ending Cumulative No. 'I Date Balance Interest Principal Balance Interest 31 11 11/12007 414,507.12 2,417.96 12,631.33 401,823.80 107,318.63 32 12/12007 401,8238] -2,343.97 12,757.31 382,066.48 109,66261 11 33 �l1 111/'1008 389,066.48 2,269.55 12,831.73 376,234.75 111,93216 34 It 2/1/1008 376,234.75 2,194.70 12,906.58 363,328.17 114,126.86 35 SUM 363,32317 2,119.41 12,981.87 350,346.30 116,246.28 36 SII 4/12008 350,346.30 2,043.69 13,057.6D 337,28370 118289.96 37 5112006 337,28370 1,967.52 13,133.77 324,154.93 120,257.48 38 6112008 324,154.93 -1,890.90 13,210.38 310,944.55 122,14338 39 1 711/2008 M,944.55 1,813.84 13287.44 297,657.11 123,96223 40 jl 8112008 297,657.11 1,73633 13,364.95 284,29216 12369356 41 9112008 284,29216 1,656.37 13,44291 270,84924 127,35693 42 - : 10!12008 270,849.24 1,579.95 13,521.33 257,327.91 12393689 4311/12008 - 257,327.91 1,501.08 1300.21 243,727.71 130,437.97 44 ji 12/1200B 243,727.71 1,421.74 13,679.54 230,048.17 131,859.71 45 II 1/12009 230,048.17 1,341.95 13,759.34 216,286.83 133,201.66 46 SII 2llM 216,288.83 1,261.68 13,839.60 202,44923 134,463.34 473112009 202,44923 1,180.95 13,920.33 18352390 135,644.30 48 SII: 4112009 188,528.9D 1,099.75 14,691.53 174,527.37 136,744.05 49 'I� 51111009 174,527.37 1,01608 14,06321 160,444.16 137,76212 50 611(1009 160,444.16 935.92 14,165.36 14627380 13305 51 !I 7/12009 146278.80 853.29 14,247.99 132,0.''0.80 139,551.34 52is 8102009 132,030.80 770.18 14,331.11 117,699.70 140,321.52 53 911i2009 117,699.70 686.58 14,414.70 10328500 141,008.10 54 i” 1011/10l)<J 103,285.00 602.50 14,49379 86,78621 141,610.60 55 11/12009 8378621 517.92 14,531.37 74202.84 142,128.52 56 Ills 12/01009 74,20284 432.85 14,668.44 59,534.41 14'1,561.37 57 1/12010 59,534.41 347.28 14,754.00 44,780.40 142,90&65 5B 21120'10 44,780.40 26122 14,840.07 . 29,940.34 143,169.87 59 I� 311/2010 29,940.34 174.65 14,92663 15,013.71 143,344.52 69 ii 4112010 15,013.71 87.58 15,013.71 0.00 143,43210 „I ill Page 6 of 6 O o V 0 0 0 0 0 0 0 0 0 0 N NNON V N MO to NN c0 (0 a rnn (rinv66c6 66mc64 U fo W MmOOaONOfONO to A m ro aD M O a o 0 0 0o M r0 M c OMI Contract Amendment No, 11 (A)A) y O) r M 44�0 M '- n O (O O to N O m@ C 'j Page 19 of 20 N M N Ln N to N to to V C O O d3 EA EA fA EO EA fA fA M to V) 4f) (o .L. m V c .0 'm 'U N O m ( o n o m m U m d Eto L m N V m T (p m O -0 > a) oov000000000a m °1 ,m) E N NNON � N W MtDNN CO0 O m � moi o' ria M' 60 ui of cj c6 0 m E y o c U N V Mn Co 0000000 a tp N0010 rO ao 'qt (o0 O O y C C m 006 COO Ln TZ 0000) tn n O m O 'p m N N M N N N M N M N N N M C N N a E m � N m m IL m E m m a m o m m 0 E o t C w m m m E m00 (0000000000 (6 m 3 m a`) to (o (OO V' ON N CO 00Nr0 t m � nMnNO t00 OIO to 'i 0; tb OnO N n � (O fo O m M OMMONOM CO 0 (O NOM Uj N ami C 07 (0 (6 lO CO mh0 (60 N mC E C C y 0 0 O O O O O M 0 0 0 0 CO) .] a) y fA m 0 0 0 U .. 0 N x M 0 N U mm :EEam) m L a > O a U o m m a m c m @ O N O 00CC) 000 (O U) LO M M 0 C m � D m tnNNNNr � nn n 10 (O N N� m 0 0 U N OOOaNo M N N M O O o O Of m O O O 00 O O O o O 0 0 0 O - 0 0 0 6 6 6 6 m m ® 000 00M y .L.., 0 U m m C 'm nn00M (o (O OD vmm p W IOOOW0) M Ono NCO m C TL U 0 o ooh c0o ((DLO (� n (ON M M r c > � y !_' O o 0 0 0 0 0 0 0 0 0 0 0 m 0 0 0 0 0 0 0 0 0 0 0 0 0 j rn m m 7 0 0 0 0 0 0 0 0 0 0 0 0 m m (!_ O rmfi C y ,(Do U O O o 0 0 0 0 0 0 0 0 0 m m = m Y 0 0 o 0 0 0 0 0 0 0 0 o m 0) 3 n Y 0 0 0 0 0 0 0 0 0 0 0 0 .> N m N M m c m a aoi NL > L.. c o 0 0 0 0 0 0 6 6 6 0 6 m00000000o c E N N m 0 m m m m m m m m m n � d Qrn rn rn d N N N N N N N N N Q O Y _m d E m m IL M p N 1 U ` M C U. mT = mE N U > 0 0 0 0 0 0 0 0 0 0 0 0 0 Q d va 0000000000006 E � aa 'c 0 0 0 0 0 0 0 0 0 0 0 0 0 O = > > N N 0 OD N 00 0 0 0 W of 0 0 " >+ V m 0 t rMM-T o30 V MM (ovv TL c E m to M � C%J M 0) O M 0) (O (O nr U C_) m m t 0) 000 COQ M OW00 m m 0 N 'O ' COC 0 0 0 0 O O O O O O M M m m V m O O O o 0 0 0 0 0 0 0 0 m M m o c U > Om E 'C p la w o m > > > m a m m m o F > a m Z c O (nQ (i HOZ 0 .5 a c a m m c m o a 0 0 0 0 0 0 0 0 0 0 0 0 m o E o m 000000000000 � m (D w - # w Co cow CO Co CO OD obNCD w nnnnnnnnnnnn `m 0 0 tDw(O O0 to t0 OOOO L m m Q co OcomNOD caM W w m wOD F rnam � r A.1 . OMI Contract Amendment No, 11 (A) Page 20 of 20 Schedule of action items related to installation of power generation equipment at the Paul R. Noland wastewater treatment facility by Power Secure in 2005. Action Date Agreement Signing 1 /18/05 Receipt of IDG® System Submittal 2/18/05 Equipment Shipping Date to Site 5/16/05 Substantial Completion of 5/23/05 Installation Final Commissioning/Start-up 611 /05 +I it k A.2 OMI Contract Amendment No. 12 Page 1 of 15 FAYETTEVILLE THE CHT OF FAYETTEVILLF, ARKANSAS DEPARTWNTAL CORRESPONDENCE TO: Mayor Dan Coody City Council COPY: David Jurgen, Steve Davis FROM: Matt Taylor DATE: February 2, 2005 RE: Noland Treatment Plant Generator - Potential Savings Calculations Attached is a spreadsheet that contains information about the potential cost savings from the use of a 2 megawatt "generator at the Noland Treatment Plant. The spreadsheet was developed by Power Secure and is well detailed. It is based on the 12 month period from February 2003 — January 2004 and shows a gross potential savings of approximately $206,000 per year. A second spreadsheet was developed based on information obtained directly from Ozarks Electric (from Keith Kaderly, our customer service representative) that used the 12 month period fmmNovember 2003 — October 2004_ It was slightly less deFailed than the attached spreadsheet, but it indicated a gross potential savings of approximately $195,000 per year. Both values were in relative agreement, but we reduced our estimate of the potential. savings to $150,000 per year to account for lower predicted flows at the plant and the cost of diesel fuel to operate the generator. Based on the information available, the savings estimate of$150,000 per year is very conservative. If you have any questions please fi:el free to call me at 575-831& or I can address questions at the meeting on Tuesday. A.2 OMI Contract Amendment No. 12 Ili Page 2 of 15 III lil ill gmNe �" o � p1 mm pp • Y � Ip N" tl NO � mngmr s UTil; � r4- m � rn nv. N $ Rmn � III Om= .. mc III - Q E00 . d m x e C4 g;mmoti Nry 4n, `Ji, Or vo m pd waY «NiN « nHwnwww .Ni $ 'S zow s � om ,, Q m $ eervsmo a � » gg : mgo "y4^ ^ � eamp �m mmv c . � �2m apos msooi, mrx �orvory 6" � � � •• ' pp 9 � 0 � n � morik ; ma _ � wnn inn Np mc " $9 $9 E uE �F, � ndmnr � $moroa � p pU � $ � � 7FN « IL (j yj �'! fI N! 1� 0 Y? mWONNm � 9mzu. u7 mm yy p O O -a inpEm � o 'n m vVV nnolo`1pp'i. � ° " q moo oloV lSV {S{VVSryory gggg Co Vg 3 ILF IftII IGU 7lVN0n � �m Gt' Vm �Gn S 4£ CEw N °) W OO� mWmrvi °Ni °Ni °Ni a 7 « w w » a w m N v 0 O V P w w N M N N N M N M M « p w � » = w ^ N It & ° g Nmamm N , � �. g983 � mo �r Oo g .vmm � m � m 5 ° aEmo � � � cloo ao � �oo � o o C wt�O w" w » rvw ww » wwwwn � z � Wwww wwwwwwwww � � � �,: c' � ° �` 3 vdoNodcdocccd v ; $ mSoo oS $ oSeeooS S E . . o @o N NNNrNNN e m u � wmmm � mmmmmmm $ � � c w wi> ' ^ N » m 00- 00 pQ � mmm 000 Sa � � 000000 $ E 'n e3 n '3F uoU` < _www » » w ' z r 4 0 5 i _ o m 'i � 00 o SSSSSS ? m ^ N » � � Sv m $ $ SoSmoo� 88Sm y E .° 00000 � c p = G $ S $ S $ ocd6co o' a° y3c8NmmS � rrdmm c a 'a LL lil m UVw w w « « » » ww N V r n p 5 5 E 4 mommNmomm $ 5 9 2d B c r 0 SII ' n000m o x 'o r c v ma 5 m R n w MIX ; o a ° = 3 D m pcQ E cE $ omo $ 000 $ m -� `o u mEmooS $ io° $ m $ $ oo m i ° au ISI 'm NNNNNNNN `o i[ p NNNrvrvrvNNNNN - g is E d C qo444o m . ow0e0 0- aa ` � a4' 4 m u2y� 0q io� -qq o A.2 OMI Contract Amendment No. 12 Page 3 of 15 RESOLUTION NO, A RESOLUTION APPROVING AMENDMENT NO. 12 TO THE CONTRACT WITH OPERATIONS MANAGEMENT INTERNATIONAL (OMI); AND APPROVING A BUDGET ADJUSTMENT TRANSFERRING $887,000.00 FROM USE OF FUND BALANCE TO THE WASTEWATER TREATMENT PLANT GENERATOR CAPITAL PROJECT. BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FAYETTEVILLE, ARKANSAS: Section 1 . That the City Council of the City of Fayetteville, Arkansas hereby approves Amendment No. 12 to the contract with Operations Management International (OMI). A copy of Amendment No. 12, marked Exhibit "A" is attached hereto, and made a part hereof. Section 2. That the City Council of the City of Fayetteville, A hereby approves a budget adjustment transferring $887,000.00 fro un Balance to the Wastewater Treatment Plant Generator Capit PASSED and APPROVED this 81b day of Februdr' 005 PROVE: - t FOODY, Mayor A - T: ^�z By: ^ SMITH, City Clerk A.2 OMI Contract Amendment No. 12 Page 4 of 15 i AMENDMENT NO. 72 TO AGREEMENT FOR OPERATIONS, MAINTENANCE AND MANAGEMENT SERVICES FOR THE CITY OF FAYETTEVILLE, ARKANSAS WASTEWATER TREATMENT PLANT THIS AMENDMENT NO. 12 to the Agreement for Operations, Maintenance and Management Services for the , City of Fayetteville, Arkansas Wastewater Treatment Plant dated September 1, 1994 (the °Agreement"), made effective on the 1S1 day of January, 2005, by and between the City of Fayetteville, Arkansas, whose address for any formal notice is 113 W. Mountain St, Fayetteville, Arkansas 72701 (hereinafter the "City") and Operations Management International, Inc., with offices at 9193 S. Jamaica Street, Suite 400, Englewood, Colorado 80112 (hereinafter "OMI") is made and entered into for purposes of amending certain provisions of the Agreement, to prevent the facilities covered by the Agreement from being deemed to be used in the trade or business of OMI pursuant to Section 141 (b) of the Internal Revenue Code of 1986, as amended. NOW THEREFORE, the City and OMI agree to amend the Agreement as follows: 1 . Article 4.1 is hereby deleted in its entirety and replaced with the following Article 4.1: 4.1 For services rendered during calendar year 2005 the City of Fayetteville shall pay to OMI the actual cost of services performed plus an annualized management fee of Eighty One Thousand Six Hundred Ninety Seven Dollars and Eighty Six Cents. ($81 ,697.86). Said fee and estimated cost (base fee) shall be paid in twelve (12) equal monthly installments. The II management fee for subsequent years will be determined proportional to the increase in estimated cost 2. Article 4.3 is hereby deleted in its entirety and replaced with the following Article 4.3: 4.3 OMI estimates the cost for services for calendar year 2005 shall he Five Million Three Hundred Twenty Seven Thousand Two Hundred Fifty Two Dollars and Eighty-Nine Cents ($5,327,252.89). Details of said cost are shown in Appendix J. The base fee shall be negotiated each year in September for the upcoming calendar year. Should the City and OMI fail to agree, the base fee will be determined by the application of the base fee adjustment formula shown in Appendix F. Should the actual expenditures exceed estimated expenditures by more than Twenty Thousand Dollars ($20,000), in any year of this Agreement, specific approval will be obtained from the City prior to OMI incurring additional costs. 3. A new Appendix L is added in the form attached hereto. This Amendment No. 12 together with the Agreement, constitutes the entire agreement between the Parties and supersedes all prior oral and written understandings with respect to the subject matter set forth herein. Unless specifically stated all other terms and conditions of the Agreement shall remain in full forceand effect. Neither this Amendment nor the Agreement maybe modified except.in writing signed by an authorized representative of the Parties. j Page 1 of 4 I A.2 OMI Contract Amendment No. 12 Peg 5 of 15 The Parties, intending to be legally bound, indicate their approval of the Amendment by their signatures below. OPERATIONS MANAGEMENT CITY OF FAYETTEVILLE INTERNATIONAL, INC. Roger B. Quayle Dan Goody Senior Vice President Mayor Date: Date: APPROVED AS TO FORM: Kit Williams City Attorney Date: i j.i Page 2 of 4