2021 2:00:00 PM

Meeting Link: https://zoom.us/j/95400718003
Meeting Dial-in #: 1-669-900-6833 Meeting ID: 95400718003

Consent Items: 8.3

Title: Consideration, discussion, and possible approval of an assignment and assumption agreement (AC-5730) to assign the duties of effluent agreement (A-3167) from Martin Marietta Materials, Inc. to Pyramid Materials, Inc.

Petitioner/Presenter: John A. Martini, P.E., Assistant City Manager/Kevin Porter P.E., Utility Manager

Recommendation: Staff recommends the City Council approve the assignment and assumption agreement (AC-5730).

Financial Impact: Expected revenue of $90,000 ($64,000 amortized infrastructure connection fee and approximately $26,000 of effluent use) annually to Fund 1650 Effluent Operations Fund through the end of the agreement.

Business Impact (Per NRS 237):
A Business Impact Statement is not required because this is not a rule.

Agenda Item Brief:

Martin Marietta Materials intends to sell the Spanish Springs Quarry to Pyramid Materials, Inc. The assignment and assumption agreement will assign the duties described in effluent service agreement A-3167, dated December 31, 2004, from Martin Marietta Materials to Pyramid Materials. The agreement allows for assignment to a new property owner with the written consent of the City.

Background:

The City of Sparks entered into an agreement (A-3167), for the sale of treated effluent, with Martin Marietta Materials on December 31, 2004. The treated effluent provided per the agreement is used for aggregate production at the Spanish Springs Quarry at 11059 Pyramid Highway. The term of the original agreement was 20 years, ending December 31, 2024. The agreement was amended in 2008, 2009, and 2010 to adjust time of delivery for effluent and the maximum / minimum annual amounts of effluent water to be delivered.

Analysis:

Martin Marietta Materials, Inc. and Pyramid Materials, Inc. provided formal notification of the intent to assign and assume the agreement for treated effluent service on January 7, 2021. Section II.E and General Provisions section F of agreement A-3167 allow for sale of the site and assignment of the agreement with the written consent of the City. Upon assignment to Pyramid Materials, Inc., all other terms of agreement A-3167 will remain in full force and effect, with the only difference being that the other party to the agreement will be Pyramid Materials, Inc.

The original agreement for treated effluent service and the proposed assignment and assumption agreement are attached for Council’s review.

Alternatives:

City Council could approve the assignment and assumption agreement as outlined by Staff.
City Council could reject the assignment and assumption agreement and provide direction to the City Manager.

Recommended Motion:

I move to approve the assignment and assumption agreement (AC-5730), specific to agreement (A-3167), with Martin Marietta Materials and Pyramid Materials.

Attached Files:

01 - Assignment and Assumption Agreement _ A-3167signed.pdf

02 - A-3167 Agreement for Sale of Treated Effluent.pdf

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