23-R-44 FM 1518 Water and Sewer Main Developer RMBRESOLUTION NO. 23-R-44
A RESOLUTION BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS, AUTHORIZING THE CITY MANAGER TO ENTER
INTO A DEVELOPER REIMBURSEMENT AGREEMENT WITH THE
SCHERTZ 1518, LTD. FOR THE RELOCATION OF UTILITIES -
SPECIFICALLY WATER A.ND SEWER MAINS ALONG FM 1518 IN
PREPARATION FOR THE FM 1518 PROJECT
WHEREAS, the Texas Department of Transportation (TxDOT) is undertaking the FM
151 8 Project and has acquired additional right of way for the widening of the highway; and
WHEREAS, a 12" water and IO" sewer main of the City of Schertz, Texas, (City) is
located in conflict with the planned TxDOT improvements to FM 1518; and
WHEREAS, the City of Schertz win reimburse Schertz 1518, Ltd. the costs incurred in
adjustment, removal, and relocation of the Water and Wastewater Main; and
WHEREAS, City Staff has recommended that the City enter into a Developer
Reimbursement Agreement with Schertz 1518. Ltd. for the relocation of utilities along FM 1518
and reimbursement of project costs.
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS THAT:
Section J . The City Counci1 hereby authorizes the C ity Manager to execute the
Developer Reimbursement Agreement with Schertz 151 8, Ltd. in substantially the fonn
set forth as Exhibit A.
Section 2. The recitals contained in the preamble hereof are hereby found to be true, and
such recitals are hereby made a part of this Resolution for all purposes and are adopted as
a part of the judgment and findings of the City Council.
Section 3. All resolutions, or parts thereof, which are in conflict or inconsistent with any
provision of this Resolution are hereby repealed to the extent of such conflict, and the
provisions of this Resolution shall be and remain controlling as to the matters resolved
herein.
Section 4 . This Resolution shall be construed and enforced in accordance with the Jaws
of the State of Texas and the United States of America.
Section 5. If any provision of this Resolution or the application thereo f to any person or
circum stance shall be held to be invalid, the rema inder of this Resolution and the
appli cation of such provision to other persons and circumstances shall nevertheless be
valid, and the City Council hereby declares that this Resolution would have been enacted
without such invalid provision.
Section 6. It is officially found, determined, and declared that the meeting at which this
Resolution is adopted was open to the public and public notice of the time, place, and
subject matter of the public business to be considered at such meeting, including this
Resolution, was given, all as required by Chapter 551 , Texas Government Code, as
amended.
Section 7. This Resolution shall be in force and effect from and after its final passage,
and it is so resolved.
J
PASSED AND ADOPTED, this~ day of May, 2023.
REIMBURSEMENT AGREEMENT \VITH DEVELOPER FOR
CONSTRUCTION OF PUBLIC ™PROVEMENTS
ASSOCIATED WITH FM 1518
THE STATE OF TEXAS
COUNTY OF BEXAR
§
§ KNOW ALL PERSONS BY THESE PRESENTS:
§
This Reimbursement Agreement with Developer for Construction of Public Improvements
Associated with FM l 518(the "Agreement") is by and between the City of Schertz, a Texas
municipal corporation (the "City"), and Schertz 1518, Ltd., owner and developer of certain
hereinafter described property Jocated within the City (the "Developer"), all collectively
referred to as "Parties", and is effective upon the execution of this Agreement by the Developer
and the City (the "Effective Date'').
'WHEREAS, Developer wishes to develop certain property (the "Property") located within
the City limits, out of the Julian Diaz Survey No.66, Abstract No. 187, County Block 5059, the
E.R. Evans Survey No. 80, Abstract No. 216, County Block 5060 and being out of a 145.427 acre
tract oflandas conveyed to Schertz 1518, Ltd. ofrecord in Volume 11564Page1814and a 91 .288
acre tract ofland as conveyed to Schertz 1518, LTD of record in Volume 11601Page2280, all
being of tl1e official public records of Bexar Cowity, Texas and situated in the City of Schertz,
Bexar County, Texas.
WHE.REAS, FM l 518, a Texas Department of Transportation ("TxDOT") roadway, is being
widened and certain water infrastructure ("Water Infrastrucrure") and wastewater infrastructure
("Wastewater lnfrast:mcture") along with ancillary and related improvements necessitated by
the widening of FM 1518 (collectively the "hnprovements") located in the right-of-way must
be relocated, extended, and/or upsized as depicted in Exhibit "A"; and
WHEREAS, the City submitted to the Developer a request that the Developer undertake the
completion of the Improvements for the benefit of TxDOT, the City, and of the Developer,
which Improvements will benefit portions of the City beyond the Property; and
WHEREAS, the City anticipates entering into an agreement with TxDOT pursuant to which
TxDOT will reimburse the City for, among other things, the costs associated with the relocation
of the ten inch (lO") wastewater line (IO" WWL") including all hard costs, soft costs, and
ancillary costs associated with the relocation of the 1 O" WWL (the 04TxDOT Reimbursement
Agreement"); and
WHEREAS, it is not anticipated that the TxDOT Reimbursement Agreement will reimburse
the City for any other costs associated with the Improvements other than the costs associated
with the relocation of the l O" WWL including, however, all hard costs, soft costs, and ancillary
costs associated with the relocation and construction of the IO" WWL and that the remaining
costs of the Improvements shall be the responsibility of the City except as set forth in Section
2.8: and
WHEREAS, Developer and the City have agreed that the Developer wil1 construct (i) the
Improvements to serve the Property, and (ii) the remaining improvements that must be
relocated out of the FM 1518 ROW as depicted in Exhibit "A" and further described herein
and in Exhibit "B"; and
WHEREAS, the City has agreed to reimburse the Developer for certain costs associated with
the construction of the Improvements as more specifically set forth herein and as set forth in
Exhibit "B"; and
WHEREAS, the City and Developer find it to be to their mutual advantage to enter into this
Agreement for the construction of the Improvements; and
WHEREAS, the Property and Improvements are located within lhe Schertz Tax Increment
Reinvestment Zone Number Two; and
WHEREAS, Section 212.071, et. seq. of the Texas Local Govennnent Code authorizes
municipalities to enter into a contract with a developer of a subdivision or land in the
municipality to construct public improvements related to the development without
complying with the competitive sealed bidding procedures of Chapter 252 of the Texas Local
Government Code; and,
NOW THEREFORE, for and in consideration of the premises and mutual obligations,
covenants, and benefits hereinafter set forth, the Parties agree as follows:
ARTICLE I -Definitions.
The following terms and phrases used in this Agreement shall have the meanings ascribed
hereto:
1.1. "Agreement" means this agreement, including any amendments hereto,
between the City and Developer.
1.2. "Contractor" shalt mean the person, finn, corporation, partnership, association,
or other entity awarded the contract by Developer for the construction and installation
of the lmprovements pursuant to public bid.
l.3. "City's Participation Costs" shall mean actual costs associated with the
construction of the Improvements, including, but not limited to, construction costs,
engineering costs, legal costs, administrative costs, and consulting costs of third
parties, the cost of bonds and insurance, costs or expenses associated with soliciting
bids for the constmction of the Improvements, all costs of acquiring easements
(whether in cash or in-kind), surveying, geotechnical, and materials testing costs;
ancillary costs associated with, caused by, or occasioned by any delay on the part of
the City in obtaining permits, approving plans, submissions, or applications, i.e.,
remobilization costs or increases in the cost of materials resulting from such delays,
and similar costs or expenses; it being the intent hereof that all City's Participation
Costs shall be the responsibility of the City of Schertz to the extent of and as set forth
2
on Exhibit "B" hereto and Developer shall have no cost, exposure or liability therefor
except as set forth (i) in Section 2.2 below, (ii) as identified and set forth on Exhibit
"B" attached hereto, and (iii) in Section 2.8 below. The City's Participation Costs
are estimated to be approximately Three Million One Hundred Eight Thousand Eight
Hundred Twenty-Seven and 67/IOO Dollars ($3,108,827.67), subject to
reimbursement from TxDOT pursuant to the TxDOT Reimbursement Agreement
(hereinafter defined); however, the City's Participation Costs shall not exceed the
actual costs expended.
1.4. "Improvements" shall mean the improvements described herein, depicted on
Exhibit "A" and further described on Exhibit "B".
ARTICLE II -Constrnction of Improvements.
2.1. Acquisition of Easements. Developer agrees to acquire and dedicate (or provide
for future dedication) of all necessary utility easements as illustrated in Exhibit "A"
attached hereto. The City's Participation costs will include the easement acquisition
costs for easements from third parties who are not affiliated with Developer as set
forth and described on Exhibit "B" (the "Easement Consideration") and the
reimbursement to Developer for Easement Consideration shall not be limited by any
provision of the TxDOT Reimbursement Agreement. The Easement Consideration
may include the costs of construction of improvements paid for by Developer for the
benefit of such third party and shall also include such professional fees as may have
been associated with such Easement Consideration. Easements may be dedicated via
approved recorded subdivision plat or through separate instrument approved by the
City.
2.2. Construction of Improvements. Developer agrees to construct the
Improvements in accordance with the plans and specifications to be prepared by
Malone/Wheeler, Inc., approved by the City Engineer, and, to the extent required by
the TxDOT Reimbursement Agreement, also approved by TxDOT. The parties
acknowledge that the plans and specifications for the Improvements have not yet been
bid and may be subject to change. After approval and issuance of construction permits
for the Improvements by all necessary governmental regulatory bodies, no change in
the construction plans shall be made by Developer without the prior written consent
of the City Engineer and, to the extent required by the TxDOT Reimbursement
Agreement, also approved by TxDOT. The entire cost of the construction of the
Improvements shall be the responsibility and obligation of Developer, subject to the
reimbursement obligations of the City as herein provided. for the purposes of clarity,
the approvals of TxDOT set forth herein and in the TxDOT Reimbursement
Agreement shall not limit, diminish, or cap the reimbursements to Developer
hereunder.
2.3. Contracts for Construction. The City and Developer acknowledge that
Developer will utilize the competitive sealed bidding procedw-e as defined in Local
Government Code Sec.252 Subchapter C to select a. qualified Contractor to constrnct
the Improvements in accordance with the plans and specifications as they may be
3
approved by the City Engineer. The City Engineer shall promptly review all bid
documents, contract documents, cost estimates, and construction plans for the
Improvements that are submitted to the City for City approval. Developer shall be
solely responsible for payment of the work as it is completed, and shall make all
payments in a timely manner to the Contractor, sub·contractors, and other parties
involved in the construction of the Improvements.
2.4. Performance, Payment and Wananty Bonds. Developer shall post (or cause
to be posted) with the City faithful perfonnance, payment, and warranty bonds for
construction of the Improvements to ensure completion of the project. The bond
must be executed by a corporate surety in accordance with Chapter 2253, Texas
Government Code. The Developer shall covenant (or cause the Contractor to covenant)
to warrant the public improvements for a period of two (2) years following acceptance
by the City of all Improvements. A warranty bond shall be provided in the amount of
20% of the costs of the Improvements for such period. The costs of such bonds shall
be a reimbursable cost as set forth on Exhibit "8"; provided, however, the bond costs
shall be allocated ratably between the improvements which are being reimbursed to
the City by TXDOT and those which arc the exclusive expense of the City or
Developer.
2.5. Inspection. The City Engineer or designee shall periodically inspect the
construction of the Improvements in the same manner, and shall possess the same
authority, as is provided during the construction of subdivision improvements
pursuant to the City of Schertz Subdivision Ordinance, as amended.
2.6. Insurance. The Contractor awarded the contract to construct the Jmprovements
shall be required to carry Worker's Compensation Insurance on his employees
and public liability and property damage insurance on his equipment and
employees. The public liability insurance shall be not less than five hundred
thousand dolJars ($500,000.00) per person and one million dollars ($1,000,000.00)
per occurrence, with property damage insurance of not less than five hundred
thousand dollars ($500,000.00). In addition, City shall be furnished with Certificates
of Insurance and shall be named an additional insured on such Certificates, and City
shall be notified within thitty calendar days of any cancellation of such insurance.
To the extent required by the TxDOT Reimbursement Agreement, TxDOT shall be
furnished with Certificates of Insurance and shall be named an additional insured on
such Certificates, and TxDOT shall be notified within thirty calendar days of any
cancellation of such insurance.
2.7. Accounting. Developer shall submit to City a complete accounting of all
costs incurred by Developer in the construction of the hnprovements. City will not
contribute or pay for any costs incurred by Developer which were not contemplated
to be reimbursable costs by City as set forth herein. Developer shall maintain the
accounting of the Improvements for a period of two years from the date of
acceptance by the City, and the City may inspect the Developer's books and records
related to the Improvements at any time with reasonable notice.
4
2.8. TxDOT Reimbursement Agreement. The reimbursements provided by the
TxDOT Reimbursement Agreement to the City shall be for the cost of the ten inch
(1 O") wastewater line and the associated costs, including, bul not limited to those items
enumerated and identified as City's Participation Costs. Except as otherwise provided
for herein, the City shall not be obligated for reimbursing to Developer individual costs
or line items under this Agreement which are identified as reimbursable items to the
City in the TxDOT Reimbursement Agreement and which are in excess of the amount
of reimbursement which the City receives pursuant to the TxDOT Reimbursement
Agreement. It is understood and agreed by the parties that TXDOT will only reimburse
City for lhe costs associated with the moving and relocation of the ten inch (IO")
wastewater line and that Developer shall be responsible for the upsizing to an eighteen
inch ( 18") wastewater line. For the purposes hereof, the dete1mination of the cost of
Upsizing shall be by an alternate bid from the Contractor reflecting the differential in
cost between the ten inch (1 O") wastewater line and eighteen inch (18") wastewater
line. The City agrees to consult with and keep Developer advised of negotiations with
TxDOT with regard to costs being reimbursed under the TxDOT Reimbursemenl
Agreement in order to assist Developer in being fully reimbursed for its costs
hereunder.
2.9. Indemnity. Developer agrees to protect, indemnify, and save City harmless
from and against all claims, demands and causes of action of every kind and
character arising in favor of any third party on account of, or resulting from,
the performance of this Agreement by Developer or Developer's agents,
representatives, employees, contractors, 01· subcontractors.
ARTICLE Ill-Obligations and Payments.
3. l. Developer Obligations. The Developer agrees to dedicate or cause to be
dedicated to the City all necessary easements required in order to construct the
Improvements. Easements which are granted will be reflected on the final plats or,
where necessary, dedicated by separate instrument. Easements granted by third parties
will be dedicated by separate instrwnent.
3.2. City Obligations. The City agrees to pay to Developer City's Participation
Costs which shall equate to the actual costs for the City's responsibility as set forth
on Exhibit "B" and as otherwise specified herein. Notwithstanding any
provision of this Agreement to the contrary, City's Obligation shall only be for the
reimbursement of costs incurred by Developer and shall not in any event exceed
the percentage of Costs a<; set forth on Exhibit "B" for any individual line item
(hereinafter the "City's Share").
3.3. Payment Procedures. City shall deliver to Developer payment of the City's
Share as provided in this this section.
3.3.1 Developer shall periodically submit (anticipated to be monthly) a
draw request (the "Draw Request") and the City Engineer shall review the
5
Draw Request showing costs incurred by the Developer during the prior month
(or similar construction period). The Draw Request shall include (i) all
Contractor pay applications (including non-reimbursable costs and expenses),
and (ii) lien waivers from the contractor for the percentage of completion or
amount requested. At the request of the City, engineering or other professional
fees shall be invoiced based on a fee schedule (or similar methodology) rather
than a lump swn basis. Within eight (8) days of the submission of the Draw
Request to the City, the Developer shall certify to the City t11at it has approved
the Draw Request. Provided, however, City understands and recognizes that
Developer is advancing its capital for City's Costs and that Developer may
submit Draw Requests more frequently than monthly to the extent that some
invoices and/or Draw Requests are submitted by the Contractor to Developer
more frequently than monthly.
3.3.2 Upon the City Engineer's receipt of each Draw Request, the City
Engineer shall promptly inspect the Improvements (or otherwise be satisfied
with information and evidence submitted by Developer) to confirm the
percentage of completion as set fo1th in the Draw Request. The City Engineer
shall approve or reject the Draw Request within ten ( 10) days of submission of
the Draw Request by Developer. If approved, the City Engineer shall promptly
cause the City to reimburse Developer for the amount of the Draw Request
which Draw Request shall be funded within fifteen (15) days of approval by
the City Engineer. If rejected, the City Engineer shall specify the reason for
rejection and the requirements to cure the objection. Upon cure and approval,
the City Engineer shall immediately cause the City to reimburse Developer for
the amount of the Draw Request. It is understood and aclrnowlcdged that the
City's Costs may be part of a larger draw request for work being performed by
and for Developer.
3.3.3 Upon the City Engineer's receipt of the final Draw Request, a final
inspection on the Improvements shall be conducted, noting any required
corrections or repairs. Once corrections or repairs are made and deemed
acceptable, the City will accept the Improvements and reimburse Developer the
final payment as represented by the final Draw Request which shall be City's
Share of (i) waste water line costs and water line relocation costs, and (ii)
TxDOT reimbursable Improvements.
3 .3 .4 Developer shall submit and the City Engineer shall review
documentation dedicating all required utility easements. Utility easements shall
be considered dedicated upon appropriate approval, execution, and recordation
of any documents establishing the easements with the Bexar County Clerk's
office. The recording fees (if any) shall be a reimbursable cost.
Article IV -Assignment, Modification and Waiver.
4.1. Assignment. This Agreement shall bind and benefit the respective Parties and
their legal successors and shall not be assignable, in whole or in part, by any party
6
with out first obtaining written consent of the other party.
4.2. Amendment or Modification. Except as otherwise provided in this Agreement,
this Agreement shall be subject to change, amendment or modification only in
writing, and by the signatures and mutual consent of the Parties.
4.3. Parties in Interest. This Agreement shall be for the sole and exclusive benefit
of the Parties hereto and shall not be construed to confer any rights upon any third
party.
4.4. Remedies Not Exclusive. The rights and remedies contained in this Agreement
shall not be exclusive, but shall be cumulative of a ll rights and remedies now or
hereinafter existing, by law or in equity.
4.5. Waiver. The failure of any party to insist in any one or more instances on
the performance of any of the terms, covenants or conditions of this Agreement, or
to exercise any of its rights, shall not be construed as a waiver or relinquishment
of such tem1, covenant, or condition, or right with respect to further performance.
4.6. Entire Agreement. This Agreement constitutes the entire agreement between
the Parties related to the subject matter of this Agreement and supersedes any and
all prior agreements, whether oral or written, dealing w ith the subject matter of this
Agreement.
4 .7. Venue. This Agreement shall be performable and enforceable in Bexar County.
Texas, and shall be construed in accordance with the laws of the State of Texas.
4.8. Severabil ity. If any term or provision of this Agreement is held to be invalid,
void or unenforceable by a court of competent jurisdiction, the remainder of the
terms and provisions of this Agreement shall remain in full force and effect and shall
not in any way be invalidated, impaired or affected.
4.9. Notices. Any notice provided or permitted to be given under this Agreement
must be in writing and may be served by (i) depositing the same in the United
States mail, addressed to the party to be notified, postage prepaid, registered or
certified mail, return receipt requested; or (ii) by delivering the same in person
to such party; or (iii) by overnight or messenger de livery service that retains
regul ar records of delivery and recejpt ; or (iv) by facsimile; provided a copy of
such notice is sent within one (1) day thereafter by another method provided above.
The initia l addr esses of the parties for the purpose of notice under this Agreement
shall be as follows:
If to City: CITY OF SCHERTZ
1400 Schertz Parkway
Schertz, TX 78154
Attention: City M anager
7
With copy to:
If to Developer:
With a copy to:
Denton Navarro Rocha Bernal & Zech, P.C.
2417 N. Main Avenue
San Antonio, TX 78212
Attention: T. Daniel Santee
Schertz 1518, Ltd.
2402 S. 2nd St.
Austin, Texas 78704
Attn: Bradley Bechtol
Bradford L. Pittenger
Round One Capital
9525 N. Capital of Texas Hwy., #123
Austin, Texas 78759
4.10. No Joint Venture. Nothing contained in this Agreement is intended by the
Parties to create a partnership or joint venture between the Parties and any
implication to the contrary is hereby expressly disavowed. It is understood and
agreed that this Agreement does not create a joint enterprise, nor does it appoint
either Party as an agent of the other for any purpose whatsoever. Except, as
otherwise specifically provided herein, neither Pai1y shall in any way assume any
of the liability of the other for acts of the other or obligations of the other.
4.11. Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be considered an original, but all of which constitute one instrument.
[Signatures and acknowledgments on the.following pages]
8
Signature Page to
Reimbursement A 2reement with Developer for Construction of Public lmprovements
Associated With FM 1518
This Agreement has been executed by the parties as of the dates of the
Acknowledgments to be effective as of the Effective Date.
THE STATE OF TEXAS
COUNTY OF TRAVIS
§
§
§
Developer:
SCHERTZ 1518, LTD., a Texas limited
partnership
BY: MTR-Schertz 1518 Management
Company, LLC, a Texas limited liability
company
By: ___________ _
Bradley Bechtol, Manager
This instrument was acknowledged before me on the __ day of 2023 by Bradley
Bechtol, Manager of for the MTR-Schertz 1518 Management Company, LLC, a Texas limited
liability company, general partner of Schertz 1518, Ltd., a Texas limited partnership, on behalf
of such entities, purposes herein expressed.
(SEAL)
9
Notary Public in and for
The State of Texas
My Commission Expires: ___ _
Sie:nature Page to
Reimbursement A greement with Develo pe1· for Construction of Public Im p1·ovemcnts
Associated With FM 1518
This Agreement has been executed by the parties as of the dates of the
Acknowledgments to be effective as of the Effective Date.
THE STATE OF TEXAS
COUNTY OF BEXAR
§
§
§
City:
CITY OF SCHERTZ,
a Texas municipal corporation
By:
Name: ________ ~-~~~
City Manager
This instrument was acknowledged before me on the __ day of , 2023 by
-------~ City Manager of the City of Schertz, Texas, a Texas municipal
corporation, on behalf of said City.
(SEAL)
10
Notary Public in and for
The State of Texas
My Commission Expires: ______ _
EXHIBIT A
IMPROVEMENTS
11
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EXHIBJTB
CITY'S PARTICIPATION COSTS
12
EXHIBITB
ESTIMATED COSTS FOR
REIMBURSEMENT AGREEMENT FOR
CONSTRUCTION OF IMPROVEMENTS
ASSOCIATED WITH FM 1518
Cost and Responsibility Allocation City Responsibility Schertz 1518 Ltd.
Estimated Percentage Estimated Percentage
Easement Acquisition Cost
Easement Acquisition $ 118,992.53 100% $ -0%
Engineering $ 35,933.50 100% $ . 0%
legal Consulting $ 37,237.50 100% $ -0%
Wastewater Line (18")*
Construction ,, .. $ 1,344,332.82
Engineering .. .. *
Legal Consulting * .. "'
Wastewater line (10")
Construction $ 1,063,659.72 100% $ -0%
Engineering $ 125,500.00 100% $ . 0%
Legal Consulting $ 5,000.00 100% $ -0%
Bonds $ 21,273.19 100%
Differential (18" vs. 10")
Construction $ -0% s 280,673.10 100%
Engineering $ -0% $ -100%
Legal Consulting $ . 0% $ -100%
Water Line
Construction $ 1,234,383.72 100% $ -0%
Engineering $ 125,500.00 100% $ -0%
Legal Consulting $ S,000.00 100% $ . 0%
Bonds $ 24,687.67 100%
Miscellaneous Costs
Other
..
$ 75,000.00 100% $ . 0%
"The intent is that the City is responsible for 100% of the costs of the WWL and the WL with the exception of the cost associated with
upsizing the WWL from a 10" to an 18". The cast differential is based on the difference in the bid alternates of a 10" WWL vs. an 18"
WWL. ..
May include services such as Surveying, Geotechnicol services, Materials testing, Arborist services, Landscape Repair, etc., but will not
exceed actual casts for services
Total Reimbursable to Schertz 1518, Estimated $ 2,826,206.97
+10% Contingency $ 3,108,827 .67