August 11, 2008

Mr. Larry Wray, Chairman

PWWSD #25

946 E. 650 Road,

Lawrence, Kansas 66047

Re:      PWWSD #25 - Request for Water Treatment

Dear Mr. Wray:

The City of Lawrence is interested to treat water in the amounts indicated in your request for PWWSD #25. In order to respond appropriately to your request, assistance from a consulting firm specializing in water system finance and rates will be necessary to ensure the structure of the agreement is equitable for both entities.

The following outlines the tasks and timeline to respond to your request:

1. Execute a Memorandum of Understanding (MOU) between the City Commission and PWWSD #25. The MOU will specify how the costs incurred with a consulting firm will be split as well as potential use of the information beyond the request for PWWSD #25 as appropriate.
2. Develop an RFP for the engineering services to be provided.
3. Engineering Services
1. Define agreeable methodology to determine the connection fee and base costs.
2. Perform a technical study to evaluate the new proposed demands and infrastructure needs for the water treatment and delivery system.
3. Establish expected costs.
4. Develop an agreement using the standard agreement currently being negotiated with Rural Water District #5.
5. Agreement Approval by the City Commission and PWWSD #25.

The development of the MOU and RFP for engineering services is expected to take 2 months with the engineering services estimated to take 6 to 8 months to complete. If the outline and timeframe above are acceptable, please contact Toni Wheeler at 785-832-3404 or Mike Lawless at 785-832-7862 to begin working on the MOU.

Sincerely,

David L. Corliss

City Manager

CC:     Diane Stoddard, Assistant City Manager

            Toni Wheeler, Legal Services Director

            Dave Wagner, Director of Utilities