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During its discussion of the IGA at the February 9, 2005, work session, the council raised a few questions and made a few requests of staff. The proposed amendments to the IGA would have separated the dispute resolution process from the Metropolitan Policy Committee (MPC) and assigned it to a dispute resolution body comprised of members selected by the MWMC partners. The council questioned this proposed change, and indicated a preference to retain the MPC as the dispute resolution body. The proposed change to the dispute resolution process has been deleted from the final draft IGA, leaving the MPC as the formal dispute resolution body. The council also discussed potential implications of the proposed IGA amendments relative to the issue of Coburg' s request to connect to the regional wastewater system. In this respect, the council requested that Coburg be provided a courtesy copy of the final draft IGA. The council is scheduled to consider the amendments to the IGA and issuance of revenue bonds by MWMC again on May 9 and to hold public hearings on the ordinance and resolution on that date. Final action on both the ordinance and the resolution is scheduled for May 23, 2005. Financial and/or Resource Considerations The regional wastewater program is supported by user fees, which are established annually by the MWMC and reviewed and ratified by the City Councils of Eugene and Springfield, and the Lane County Board of Commissioners. Capital projects are also supported by revenue from systems development charges (SDCs). The proposed changes to the IGA do not directly affect these rates, but they improve and strengthen the agreement for the bond market and give the MWMC the ability to offer revenue bonds that will be competitive in the market. The most cost-effective financing for the regional wastewater projects is a combination of user fees, SDCs, and bond proceeds. Without the ability to obtain competitive bond rates, the commission would have to consider raising user rates in the next fiscal year, possibly by as much as 65%, to generate the necessary revenues. The 2004 Facilities Plan outlines a schedule for construction of the capital improvements necessary to maintain the needed wastewater treatment capacity and capability. This schedule, if followed, allows MWMC to maintain compliance with the current discharge permit and anticipated future needs of the Eugene/Springfield communities. Adhering to the Facilities Plan construction schedule for the next five years is crucial if the MWMC is to comply with a deadline of 2010 set by the Oregon Department of Environmental Quality (DEQ) to prevent wastewater overflows during specified storm events. Delays in the construction schedule will result in any or all of the following consequences: 1) increased costs of construction; 2) increased costs due to enforcement actions taken by the DEQ or the Environmental Protection Agency (EPA) or both; 3) increased costs from defending MWMC and the partner agencies from regulatory enforcement actions and/or third party law suits; 4) threats to public health and safety caused by sewer overflows, which are projected in the next few years but will be controlled by constructing the planned improvements according to the Plan schedule; 5) the establishment of a potential requirement that significant industrial users reduce or curtail their discharges during times of peak flows at the plant; and 6) the potential denial of new connections based on inadequate wastewater treatment capacity within regulatory guidelines. Timing The timing of required capital improvements to the regional wastewater facilities is set forth in the 2004 Facilities Plan. The CIP schedule starts in 2005 and includes an extensive list of projects and activities that must be undertaken to meet the objectives, with the scheduled pace of construction and issuance of L:\CMO\2005 Council Agendas\M050411\S050411B.doc