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Council Meeting Minutes June 23, 1992 Page 3 I Council Business. continued Using this method, the City's cost is nearly $30,000 for the first year. The annual fee is remitted to the State in quarterly installments, the first due the end of September 1992. The payment method is permanent with changes in the annual fee subject to Legislative approval. Being that the fee is an expense of the Water Utility, it should be paid by users of the municipal water system. One method is to charge each customer $5.21 per year; another method is to assign a customer's share based on consumption. The last method is similar to the current rate structure for items like mains, water towers,and lift stations. To determine the preferable method, it is proposed that the Financial Policy Advisory Board review the matter. Once the preferred method is identified, a public information effort will be undertaken. Rebelein asked if it would be feasible to utilize the water restoration fund proceeds for the fee. Egan said this option will be taken under advisement. Motion by Rebelein, seconded by Williams, to REQUEST THAT THE FINANCIAL POLICY ADVISORY BOARD REVIEW THE PREFERABLE METHOD FOR PASSING THROUGH THE STATE FEE. I 5 Ayes - 0 Nayes, Motion Carried. City Engineer les Proper presented the long-term litigation settlement agreement implementing agreement Cl2SAGIA). In August 1987, the City settled with the U.S. Army over the water contamination lawsuit. Parts of the settlement pertain to the City's construction of a Granular Activated Carbon Water Treatment Facility CGAC) to restore some of the lost water supply due to the aquifer's contamination, and the remediation and clean-up of the aquifer. The basic changes the L 2SAGlA makes over past agreements are financial. The L 2SAGIA provides the City with sufficient funds to operate the GAC over the next 20 years. The past agreement involved problems with the submission and payment of bills by the Army. However, L2SAGIA would eliminate the prOblems by creation of a City administrated fund. The City is required to prepare an annual budget, annual audit and financial statement for the operation of the GAC facility. The City would review these documents with the Army and Council would provide final approval. I Because it is difficult to project the operating costs for 20 years, a three year trigger is built into the agreement to allow for the City to negotiate additional funds. Council Business Collection of State Water Testing Fee Report 92-151 L 2SAGIA Agreement Report 92-152