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City staff recommends five-year payment for Purdue wastewater connection fee totaling $1.07 million
Summary
City administration presented a proposed wastewater service agreement with Purdue that would collect a $1,071,668 connection charge; Purdue has asked to spread payments over five years, and staff recommended accommodating that schedule, subject to a written agreement and potential clawback provisions.
Perry City administration outlined terms being negotiated with Purdue for receiving domestic wastewater from Purdue's plant on Highway 247 Spur and recommended the council accept a five-year schedule for a previously proposed $1,071,668 connection charge.
Mr. Smith stated the connection charge total would remain $1,071,668 but that Purdue requested to spread payments over five years at $214,333.60 per year. He told council administration had no reservations about the five-year schedule and would prepare a formal agreement for council approval.
Councilmember Dr. Faust asked whether the payment schedule would be final or subject to later renegotiation. Mr. Smith said the written agreement would be the controlling document and that the city could incorporate a "clawback" provision so that, if Purdue stopped receiving service or otherwise tried to renege, the connection charge would still be owed. He added that any amendment would need to be in writing and signed by both parties.
Mr. Smith also confirmed the city would receive ongoing processing fees for everything Purdue brings into the plant, providing additional cash flow beyond the connection charge.
Next steps: administration will draft a formal agreement reflecting the five-year schedule and proposed protective provisions for council approval.
