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HomeMy WebLinkAboutPR 21263: ASSET REMOVAL AGREEMENT / SABINE NECHES NAVIGATION DISTRICT City of - r; :hur www.Po rtArt h u rTx.gov INTEROFFICE MEMORANDUM Date: April 21, 2020 To: The Honorable Mayor and City Council Through: Ron Burton, City Manager From: Donnie Stanton, Interim Water Utilities Director RE: P.R. 21263 —Asset Removal Agreement, Sabine Neches Navigation District Introduction: The intent of this Agenda Item is to seek City Council's approval for City Manager to approve and execute a cost-sharing, interlocal agreement with Sabine Neches Navigation District to reimburse the City for 50% of the project costs relating to the removal of the City's water line. The Project is scheduled to begin in FY 2021. The water distribution line is abandoned, but prevents the deepening of the Intercoastal Canal. The total projected cost of this project is $360,000.00 with the current information from Schaumberg & Polk, Inc; the City of Port Arthur would be reimbursed for 50% of the total project cost. An amendment to increase the project cost amount may be necessary as more information becomes known about the waterline. Background: The Sabine—Neches Navigation District currently operates the Intercoastal Canal at a minimum depth of forty(40) feet, last established in 1962. United States Army Corps of Engineers "New Start" $18,000,000 funding was approved in mid-November, 2018. The Sabine-Neches Waterway Channel Improvement Project, which began in early 2019, will increase the channel depth to forty-eight (48) feet. The City of Port Arthur owns a waterline that crosses the waterway that prevents the deepening of the canal. Budget Impact: The project will be completed and budgeted in the FY 2021 CIP. Recommendation: I recommend that the City Council approve Proposed Resolution No. 21263, authorizing the Agreement for Asset Removal between the City of Port Arthur and Sabine Neches Navigation District,pertaining to the removal of the city's water distribution line in the canal. "Remember,we are here to serve the Citizens of Port Arthur" P.O.Box 1089 X Port Arthur,Texas 77641-1089 X 409.983.8101 X FAX 409.982.6743 P.R. No. 21263 4/21/20 bw Page 1 of 3 RESOLUTION NO. A RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO AN ASSET REMOVAL AGREEMENT (COST SHARING AGREEMENT) WITH SABINE NECHES NAVIGATION DISTRICT, REMOVING AN ABANDONED WATER DISTRIBUTION LINE WITH A TOTAL PROJECED COST OF $360,000.00; PROJECT WILL BE BUDGETED AND COMPLETED IN THE FY 2021 CIP. WHEREAS, the Sabine-Neches Waterway Channel Improvement Project, funded by the United States Army Corp of Engineers "New Start" $18,000,000.00 project, which began in early 2019, will increase the depth of the Intercoastal Canal to forty-eight (48)feet; and, WHEREAS, the City of Port Arthur abandoned a water distribution line that crosses the canal; and, WHEREAS, the abandoned water distribution line prevents the deepening of the canal; and, WHEREAS, the City of Port Arthur and Sabine Neches Navigation District wish to enter into an Asset Removal Agreement (attached as Exhibit A) as it pertains to the abandoned water distribution line; and, WHEREAS,the total cost of the project is estimated to be $360,000.00; and, WHEREAS, fifty percent (50%) of the total cost of the project to the City of Port Arthur will be reimbursed per the cost sharing agreement attached (Exhibit A); and, WHEREAS, City of Port Arthur will manage all aspects of the removal of the abandoned water distribution line. The project will be budgeted and completed in FY'2021. P.R. No. 21263 4/21/20 bw Page 2 of 3 NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PORT ARTHUR: THAT, the City Manager is hereby authorized and instructed to execute on behalf of the City, an Asset Removal Agreement between the City of Port Arthur and Sabine Neches Navigation District; and, THAT, a certified copy of said Asset Removal Agreement shall be filed for record in the office of the County Clerk of Jefferson County, Texas; and, THAT, a copy of the caption of this Resolution be spread upon the Minutes of the City Council. READ, ADOPTED, AND APPROVED THIS day of , 2020, at a Regular Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES: Mayor Councilmembers: NOES: Mayor ATTEST: APPROVED AS TO FORM: (1.0W fes.::. Sherri Bellard Valecia izeno City Secretary City Attorney P.R. No. 21263 4/21/20 bw Page 3 of 3 APPROVED FOR ADMINISTRATION: Ronald Burton City Manager Donnie Stanton Interim Utilities Director APPROVED FOR AVAILABILITY OF FUNDS: Kandy Dan' Interim Finance Director (.6,4,„ Lu,th„, Clifton Williams, CPPB Purchasing Manager EXHIBIT A REIMBURSEMENT AND ASSET REMOVAL AGREEMENT BETWEEN CITY OF PORT ARTHUR AND SABINE NECHES NAVIGATION DISTRICT This Asset Removal Agreement ("Agreement") is made and entered into as of this day of , 2020 ("Effective Date"), by and between City of Port Arthur Utilities ("COMPANY") and Sabine Neches Navigation District, whose address is 8180 Anchor Drive., Port Arthur, Texas 77642 ("SNND"). Grantee and Landowner are individually referred to herein as a "Party" and jointly referred to as the "Parties". WHEREAS, SNND is the Non-Federal Sponsor working in conjunction with the United States Army Corps of Engineers ("USACE") to implement the Sabine-Neches Waterway Channel Improvement Project ("Project"), which will necessitate the removal of the hereinafter defined Line which is owned and operated by Company. WHEREAS, based on pre-engineering work done by contractors and supplied to COMPANY and SNND, SNND and COMPANY agree that removal would best be facilitated and the Project would best be served for COMPANY to remove a segment of the line as described herein to allow for the construction of the Project. WHEREAS, SNND agrees to pay for fifty percent (50%) of the total cost to perform the removal as described herein. NOW THEREFORE, for and in consideration of the premises and the mutual benefits to all parties, and intending hereby to be legally bound, it is understood and agreed as follows: I. COMPANY will remove the existing Line in order to accommodate the Project. Such removal will require the satisfaction of all permitting requirements imposed by the governing agencies which may have jurisdiction over the Line, including but not limited to the Federal Energy Regulatory Commission ("FERC"), The State of Texas, The State of Louisiana, USACE, The Texas Railroad Commission, Louisiana Department of Natural Resources, any historical commissions in both states and any other permitting agency authorized by federal, Texas or Louisiana law. 2. COMPANY will remove the Line in order to satisfy the requirements of the Project, all local, state, and federal permitting requirements as well as COMPANY design guidelines necessary to obtain required permits. All activities described in Paragraphs 1 and 2 will hereinafter be referred to as the "Work". 3. SNND shall reimburse COMPANY for fifty percent (50%) of the actual cost to perform the Work. Such costs shall include, but not be limited to, amounts paid to contractors or subcontractors to perform the work specific to the removal of Line as well as reasonable actual internal expenses incurred by COMPANY. For internal costs, the monthly invoices from COMPANY to SNND shall include a description of each activity, the name and title of the person performing the work, the date of the work, the number of hours of work performed by that person to the nearest one-tenth hour (0.1 hour). Costs shall be invoiced with reasonable specificity and without markup. 4. SNND shall reimburse COMPANY for fifty percent (50%) of all actual material costs necessary for the Work. Material costs include but are not limited to pipe, fittings, valves, shoring, pilings,fill soil & rock, mats, equipment rental, any and all erosion controls, access roads, and funding for temporary work space areas, as defined in the engineering set of plans and applicable permits. COMPANY shall provide to SNND complete copies of all invoices, statements, credit memoranda or other documentation of material costs as these documents are received by COMPANY. SNND will pay fifty percent (50%) of each invoice directly to COMPANY within 30 days of the date the invoice is received by SNND. SNND shall not pay its portion of any retainage amount until the retainage is actually due and invoiced at the conclusion of the removal. 5. SNND shall reimburse to COMPANY fifty percent (50%) of all actual labor and consulting fees necessary for the Work. Labor and consulting fees include but are not limited to construction contractors, inspection, nondestructive testing, lab testing, engineering consultants, environmental consultants, surveyor, land agents, attorneys and other such third-party service providers as necessary to complete the Work. COMPANY shall provide to SNND complete copies of all invoices, statements, credit memoranda, or other documentation of labor and consulting fees as these documents are received by COMPANY. SNND will pay fifty percent (50%) of each invoice directly to COMPANY within 30 days of the date the invoice is received by SNND. SNND shall not pay its portion of any retainage amount until the retainage is actually due and invoiced at the conclusion of the Work. 6. SNND shall reimburse to COMPANY fifty percent (50%) of the costs as set out in Paragraphs 3,4, and 5 above (collectively,the"Costs"). COMPANY estimates that the Costs to be paid by SNND are (Estimated Amount), as summarized in Exhibit A attached hereto. The associated costs summarized in Exhibit A are based on actual cost estimates from third-party consultants, contractors and historical costs for material and labor which COMPANY has paid for similar recent projects. Such Estimated Amount is a budgetary estimate only, and neither it nor any of the other estimated cost figures herein shall in any way constitute a limit upon the amount of the total actual cost of the Work incurred by COMPANY, for which SNND shall be liable to pay hereunder. Such cost estimate is based on the costs of materials and labor current at the time of preparation of the estimate, and is subject to revision by and at the discretion of COMPANY to reflect any changes in such cost that may occur prior to the unforeseen rock, water, bad weather, or any other unforeseen contingencies in connection with the Work and such contingencies will be included and accounted for in the total actual cost of the Work. SNND shall be entitled to a credit of $ toward the estimated cost share. The $ represents the cost paid by SNND for pre-engineering and survey work related to Line. This credit shall be applied to the final invoice(s). 7. All payments due hereunder shall be in the form either of a check made out to or a wire transfer to: Bank Routing Number: , Swift Code: , General Bank Reference Address: , Account Number , Account Name: . 8. COMPANY agrees to perform the Work in accordance with the requirements of the project and the permitting agencies. COMPANY shall rely on its own consultants, engineers, employees, and contractors to design and implement the Work, such as to provide COMPANY with the same like and kind functionality in the Line as existed just prior to the removal. SNND is not responsible for designing, implementing, supervising or approving the drawings or Work. SNND's only role in the Work is to reimburse fifty percent (50%) of the Costs as described more specifically above. 9. COMPANY and SNND acknowledge and agree that nothing in this Agreement shall operate or be construed as a representation or guarantee that the activities of COMPANY shall result in the Work being completed by any specific or anticipated date, and COMPANY shall have no liability whatsoever to SNND for the failure to complete the Work. COMPANY will undertake the Work in its normal course of business. The Work undertaken by COMPANY herein shall be provded with NO WARRANTY, EXPRESS OR IMPLIED, AS IS, WHERE IS, WITH ALL FAULTS, AND COMPANY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, WITH REGARD TO ITS ACTIVITIES OR ANY MATTER HEREUNDER, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR USE OR PURPOSE, OR CONFORMANCE TO MODELS OR SAMPLES OF MATERIAL. In no event shall COMPANY be liable to SNND with respect to the Work or for any losses, costs, liabilities, obligations, or damages arising out of or in connection with such Work, whether arising in contract, tort, (including, but not limited to, negligence or strict liability) or otherwise. IT IS SPECIFICALLY AGREED THAT COMPANY SHALL HAVE NO OBLIGATION WHATSOEVER FOR, AND SNND EXPRESSLY WAIVES, ANY LOST PROFITS, CONSEQUENTIAL, INDIRECT, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES, INCLUDING, WITHOUT LIMITATION, DELAY DAMAGES WITH RESPECT TO THE WORK, OR THIS AGREEMENT, REGARDLESS OF HOW CAUSED. In no event shall SNND be liable to COMPANY with respect to the Work or for any losses, costs, liabilities, obligations, or damages arising out of or in connection with such Work, whether arising in contract, tort, (including, but not limited to, negligence or strict liability) or otherwise. IT IS SPECIFICALLY AGREED THAT SNND SHALL HAVE NO OBLIGATION WATSOEVER FOR, AND COMPANY EXPRESSLY WAIVES, ANY LOST PROFITS, CONSEQUENTIAL, INDIRECT, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES WITH RESPECT TO THE WORK, OR THIS AGREEMENT, REGARDLESS OF HOW CAUSED. Neither Party has any obligation to defend, indemnify or hold harmless the other with respect to claims or lawsuits by third parties. 10. It is understood that COMPANY does not assume any additional liability connected to the SNND Project. Therefore, SNND agrees to protect, indemnify, and hold harmless COMPANY, its officers, employees, representatives, agents, contractors, and subcontractors from and against any and all claims, demands, actions, expenses (including court costs and attorneys' fees), losses, damages, causes of action, and liability whether with respect to the parties hereto or third parties, for damage to property or injury to or death of persons arising out of or in connection with the Project, except to the extent said claims, demands, actions, expenses, losses, damages, causes of action, and liabilities are caused by the negligence and willful misconduct of COMPANY or its employees or contractors. 11. This Agreement shall be effective as of the date first written above upon execution by both Parties hereto and shall remain in full force and effect thereafter until the date that the reimbursement obligations have been fully satisfied; provided however, COMPANY shall have the right to terminate this Agreement and not complete the Work in the event SNND has failed to make timely payment of the Costs in accordance with the payment provisions herein. 12. This Agreement shall be construed in accordance with the laws of The State of Texas, is subject to all valid laws, rule or regulations of any governmental authority having jurisdiction, incorporates the entire agreement between the parties, may only be changed or amended by written agreement of the parties hereto, and shall be binding on the parties hereto as well as their successors and assigns. 13. Except as otherwise provided in this Agreement, the Parties reserve any and all rights and remedies available at law or in equity. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the date first written above. City of Port Arthur Sabine Neches Navigation District By: By: Title: Title: