Council to consider memorandum with Cedar Valley Ranch as city weighs test wells and federal leases for new water sources

The Cedar City Council on June 4 debated a non‑binding memorandum of understanding (MOU) with Cedar Valley Ranch that would reserve up to 4,000 gallons per minute for the city if the ranch produces a certificated, contractable well.

The MOU is not a purchase contract, Mayor said during the meeting, but “it’s a list of it's a shopping list for both parties.” He and staff described the paper as an agreement of intent that records terms both sides have discussed and would form the basis for a later purchase contract if and when a drilled well is proven and certified by state authorities.

City staff outlined safeguards the council has requested. Jonathan Stout, a city staff reviewer, said he had reviewed the draft and recommended additions focused on long‑term performance and well construction standards: “There were a few items that I suggested that they be added,” Stout said, noting concerns about sand production and specifications to avoid “sand pumpers” that cause long‑term issues for municipal systems.

Councilors asked how the MOU ties to downstream contracting. Staff and the mayor clarified that the MOU does not obligate the city to buy water until a contract is negotiated after a well is proven; purchase and pipeline construction would be separate contract steps. The mayor said the MOU is intended to “lay down the marker” in the large ranch so both sides understand priorities for groundwater on that property.

Related water work was discussed in the same meeting. City staff reported plans to advertise bids for the Martin Flat test well with a short turnaround; staff said they will open bids Monday and return results to the council for action next week. Council members asked that staff allow an extra business day to confirm bid completeness and to provide the council time to review high‑value bids. Staff agreed to aim for a Monday opening with materials to the council promptly.

Separately, staff asked the council to approve a local government concurrence for a Bureau of Land Management (BLM) permanent lease application on the city’s south site, a procedural step required for the BLM to issue a long‑term surface lease for a production well and associated access and utility easements. Staff said the annual BLM fee for a similar site is typically under $1,000.

Councilors agreed to move the MOU forward to action at next week’s meeting so a final review and any contractual details can be addressed before execution. Staff emphasized that the MOU contains no binding purchase obligations and that a full contract, including site approvals and price, would follow only after a proven, state‑approved well.