Title
Approval to Settle Arbitrations between the City of Detroit and GLWA
Body
Agenda of: August 5, 2020
Item No.: 2020-266
Amount: N/A
TO: The Honorable
Board of Directors
Great Lakes Water Authority
FROM: Randal M. Brown
General Counsel
DATE: July 22, 2020
RE: Approval to Settle Arbitrations between the City of Detroit and GLWA
MOTION
Upon recommendation and opinion of Randal M. Brown, General Counsel, the Board of Directors for the Great Lakes Water Authority (GLWA):
1) Approves the settlement of Arbitrations between the City of Detroit and GLWA; and
2) Authorizes the Chief Executive Officer to take such other action as may be necessary to accomplish the intent of this vote.
JUSTIFICATION
On January 1, 2016 and pursuant to the Regional Water Supply System Lease, the City of Detroit leased to GLWA, among other real and personal property, watermains to supply water services to the Region. Generally speaking, the City of Detroit leased all watermains that were 24 inches and larger to GLWA. However, Section 3.3. of the Water Lease acknowledged that the Parties would continuously review the use of description of Leased Water Facilities and amend Schedule A to the Lease to conform to the actual use of the Leased Water Facilities. Within a year of assuming control of the Leased Water Facilities, GLWA advised the City of Detroit, through the Detroit Water and Sewerage Department, that many of the watermains were not being actually used by the Regional Water System and should be transferred back to the City of Detroit or decommissioned.
After several meetings, the parties agreed that it could not resolve the reallocation or decommissioning of watermains, and the issue should be arbitrated. The GLWA Board unanimously approved GLWA arbitrating which entity is responsible for specific watermains. Based on information and belief, DWSD Board of Water Commissioners authorized the City of Detroit to arbitrate the matter ...
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