ACTION REQUESTED:
Title
Communication from the City Manager and Corporation Counsel with Request for the Following:
A. APPROVE an Appraisal Assistance CONTRACT with the CEO COUNCIL and ADOPT an ORDINANCE AMENDING the CITY OF PEORIA 2018-2019 BIENNIAL BUDGET Relating to the General Fund to Recognize the Receipt and Expenditure of $400,000.00 to Assist in the Purchase of the WATERWORKS (Requires a super majority vote); and
B. ADOPT a RESOLUTION to PURCHASE the WATERWORKS.
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BACKGROUND: In 1889, the City of Peoria entered into an agreement to sell its water utility to a private company, which is now Illinois American Water Company (IAWC). That agreement was amended in 1904. The Agreement provides an option that allows the City to repurchase the utility once every five years. This option will be before the City Council again in 2019; the deadline for final decision is May 3, 2019. Per the Agreement, the City must give IAWC notice of its intent to consider purchasing the utility no later than six months prior to the anniversary of the Agreement, or November 2, 2018.
According to the 1889 Agreement and subsequent amendments, when the City desires to exercise its right to purchase the waterworks, it must do so by approving a resolution to that effect no later than six months before the expiration of every 5 years (started with expiration of 10 years) from the date of passage, May 4, 1889. Hence, November 4th in the year preceding the expiration date.
If the Council desires, they should vote on a resolution to purchase the water company at the October 30, 2018 meeting. If the parties cannot agree upon a price to be paid for acquisition, a commission is set up with an appraiser appointed by the City, a second appraiser by Illinois American Water Company and a third appraiser appointed by the first two appraisers. This "appraisal commission" determines the price at which the City would have to buy the waterworks (also called the "award").
Upon price de...
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