Stayton, Sublimity approve 10-year wastewater contract and IGA; new joint operating agreement required

Stayton and Sublimity on Monday approved linked measures authorizing a new 10‑year agreement for Sublimity’s wastewater to be treated at Stayton’s wastewater plant and an intergovernmental agreement (IGA) to govern the partnership.

Steve Donovan, who presented the staff report, said the contract is the product of nearly a year of work and called it “the single biggest recurring contract” on Sublimity’s books and a major revenue source for Stayton. Donovan described a contract structure that replaces the prior flow‑only model with three rate components: a measured‑flow allocation for operations and maintenance, an allocated depreciation charge, and a return‑on‑investment fee. He gave the first‑year figures: Sublimity will pay Stayton $759,385 for the July 1–June 30 year; the allocated operations-and‑maintenance portion for year one is $492,637; the return‑on‑investment fee is about $180,000 and will remain fixed for the first three‑year rate period.

Donovan said the cities must complete a joint operating agreement within six months of the July 1 start date. That document will formalize decision‑making (including a standing sewer committee composed of each city’s mayor, public‑works director and three mayoral designees), set procedures for capacity allocation and land‑use coordination, and define how system development charges (SDCs) will be collected and used to fund future plant expansion. Donovan warned that plant expansion could cost “tens of millions of dollars” and that SDCs will be needed to pay for capacity growth.

On the Sublimity side, Councilor Tass Morrison moved to approve the IGA and Sublimity resolution 24‑25‑6; Mayor Mike Taylor seconded. A voice vote was taken with no opposition and the mayor declared the resolution adopted; staff noted the parties had already been operating under the agreement since July 1 pending formal sign‑off. Stayton’s council then moved and adopted Stayton resolution 11‑13 approving the new 10‑year contract; the transcript records the Stayton motion carrying 5–0.

Staff said the sewer committee will reconvene Oct. 1 to continue work on the IGA and the joint operating agreement, and emphasized infiltration and inflow (I&I) abatement, contaminant source identification, and coordinated land‑use planning as immediate priorities. Staff also told councilors that the contract includes three‑year rolling rate periods to reduce volatility in annual bills.

Next steps: staff will return with the joint operating agreement language and membership details for the sewer committee, and will begin work on SDC coordination and I&I programs as outlined in the contract.