05/15/1969 Council Minutes - Laserfiche WebLink

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return on the fair value of Company's sanitary sewage (water works) system properties, after allowing for all operating expenses of Company, exclusive of - (i) Company's interest expense; (ii) Company "s depreciation charges, if any, in excess of straight line depreciation over the reasonable useful lives of Company's depreciable operating properties; and (iii) any compensation payments in excess of reasonable compensation for services actually rendered to Company. Adjustments bay be made by Company in its schedule of rates to be charged for its sanitary sewage (water) services to any one or more of its classes of users as and when, in Company s judgement, such ad- justments are needed to maintain the reasonable rate of return to which Com- pany is entitled thereunder; provided; however, that no such change in rates shall be put into effect earlier than 30 days after Company has filed with Village a written notice of its proposed revised rate schedule; and provided, further, that if within such 30 -day period Village mails to Company written bbjecti ons to any part or all of the proposed rate change such rate changes shall not be put into effect excepting to the extent and as of the effective date determined by a board of arbitration which shall be composed of three arbitrators one of whom shall be selected by Village, one by Company, and the third by the two arbitrators so selected. The board of arbitration shall oper- ate under the rules of arbitration of the American Arbitration Association and shall be convened in St. Paul, Minnesota promptly after Company receives Village's notice of objection to the given rate change proposal. The expense of the arbitration shall be borne in equal shares by Village and by Company. The decision of the board of arbitrators shall be final and conclusive on the parties but it shall not be interpreted as restficting Company from pro- posing a further change in its schedule of rates as to the classes of suers covered by the arbitration determination at any time after 12 months following the effective date of the rate for such users as determined by the board of arbitration, nor shall Company be restricted by such determination from revising its schedule of rates for classes of users not covered by the board determination at any time." 5) The special assessment possibility referred to in the third paragraph of my letter of March 20, 1969 will be recited in the deed, as well as the earnest money contract, covering each lot sold in the U. S. Lakes Development Co., area so that subsequent purchasers will be notified of this contingency. The reason for the change in Number 5 was that subsequent buyers of these parcels in Lakes Addn. No. 1 would know that they were not being assessed for the sewer and water systems by Jandric, but that the systems were wholly owned by U.S .Lakes Development until such time that the Village might buy out under the franchise. Mr. Locher listed alternatives to giving a franchise for the sewer system. 1) A straight municipal system financed by special assessments. This would be impractical since the property between the development and the near- est sewer outlet is not developed and the assessment to such property owners would be too high -- ti would either cause premature development or forfeit. Money could be raised by bond issue under the Green Acres deferral plan, but the interest would still have to be paid currently. 2) Installation by the developer with the immediate charge to be made to each parcel owner in the closing costs. 2 3) A combination system of installing a larger tank to serve the larger area with the Village paying into it on a fair share basis - -the sewer system in the same way. 4) Installation of individual systems- -sewer as set forth in Ord. #48. 5) A franchise by the developer at his expense on a 25 year basis. The developer thus owns the systems and charges fees to each user. At the time that the Village has an outlet at the property, the developer will hook into