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A i <br /> Proposal Contents <br /> City of Everett Qualifications. Presents a brief summary of Everett's past performance <br /> providing water and wastewater services. <br /> NSE Water System.Details Everett's proposal to assume the ownership and 0&M of <br /> NSE's water system by presenting the water system purchase price,scope of work <br /> needed to provide quality water service to NSE,and proposed prices. The NSE water <br /> system comprises of approximately 27,000 lineal feet of pipe,42 fire hydrants,45 valves, <br /> and 45 services. <br /> NSE Sewer System.Details Everett's proposal to assume the ownership and 0&M of <br /> NSE's sewer system by presenting the sewer system purchase price,scope of work <br /> needed to provide quality sewer service to NSE,and proposed prices. The NSE sewer <br /> system comprises of approximately 8500 feet of force mains,67600 feet of gravity mains, <br /> 40 manholes,20 service connections,4 lift stations,and stand by generator. <br /> NSE Oily Water Plant.Details Everett's proposal to privatize NSE's oily water <br /> treatment system by presenting the oily water system purchase price,scope of work <br /> needed to provide quality service to NSE,and proposed prices. The plant includes the <br /> bilge water delivery system from the piers,the attenuation tank,and treatment system. <br /> Plans and References.Presents an overview of the plans and references that Everett is <br /> incorporating into this proposal,either by reference or by appendix. <br /> Cost Proposal Summary <br /> Everett proposes to own and operate the NSE water distribution system and the sanitary <br /> sewer collection and oily water separation systems by purchasing them at their fair <br /> market value and then providing ongoing utility service through these assets and others <br /> to be built by Everett over a 20-year contract term. <br /> Everett proposes to pay the Navy$1,445,000 for the NSE water distribution system, <br /> $4,269,000 for the NSE sewer collection system, and $2,340,000 for the oily water <br /> separation system.These prices are based on the replacement cost new less depreciation <br /> value of the three systems.As such,we believe that these costs reflect the fair market <br /> value of the systems.These valuations are based on inventory and investment records <br /> provided to Everett by the Navy.Everett proposes to pay the purchase price with <br /> monthly payments over the 20-year contract term. <br /> At the same time,since the Navy is the only party that will benefit from utility service <br /> provided by the purchased system,Everett will recover the payments for each utility <br /> system by monthly charge for purchase price recovery of the water system is equal and <br /> opposite to the monthly payment made (or credit) to NSE for purchase of the system. <br /> The same equal and opposite set of charges and payments are proposed for the <br /> wastewater systems. Thus no money will change hands. <br /> Table S-1 shows prices for Normal O&M and for Transition O&M for each of the three <br /> utility systems. Prices shown are in terms of 2006-2007 dollars.O&M prices are planned <br /> to remain fixed for the first 2 years of operation.While normal O&M will naturally <br /> 63 <br /> S:\MSadka\WORD\Navy\final docskoun al Executive Summary_doc 3 5/2/2005 <br />