Consideration and Possible Approval of Settlement Agreement and Release Between the Hopi Tribe and the City of Flagstaff  (Agreement to settle litigation between the City and the Hopi Tribe relating to use of reclaimed water at the Arizona Snowbowl).

The Hopi Tribe filed a compliant against the City on August, 2011, relating the use of reclaimed water at the Arizona Snowbowl.  This Settlement, if approved, will resolve the litigation.  The City will construct an earthen-filtration system that will further filter the reclaimed water that will be used at the Arizona Snowbowl.  The Hopi Tribal Council members at the meeting on February 24, 2016 approved the Settlement unanimously.

Contained within the Settlement is the City's obligation to construct an earthen-filtration system (EFS) upstream of the City's reclaimed water meter with the Arizona Snowbowl. The capital cost to construct the EFS is currently estimated at $1.6 million.  There may be up to $181,000 per year in ongoing operations, maintenance and replacement costs as well.

COUNCIL GOALS:
8) Improve effectiveness of notification, communication, and engagement with residents, neighborhoods and businesses and about City services, programs, policies, projects and developments.
9) Improve the economic quality of life for Flagstaff through economic diversification, and by fostering jobs and programs that grow wages and revenues.

Prior discussion by the City Council was held on this item at a Combined Special Meeting/Work Session on March 8, 2016.

1)  Approve the Settlement Agreement and Release with the Hopi Tribe.
2)  Do not approve the Settlement Agreement and Release with the Hopi Tribe and continue the litigation.

In 2002, the Flagstaff City Council approved a Reclaimed Water Agreement to sell 1.5 million gallons per day (or 552 AF/ski season) of reclaimed water to the Arizona Snowbowl during the months of November thru February for snowmaking purposes.  The current agreement expires in 2034.  In 2011, the Hopi Tribe filed a compliant against the City seeking to recover under an illegal contract claim, a water rights infringement claim, and a public nuisance claim pertaining to the City's Direct Delivered Reclaimed Water Agreement with the Arizona Snowbowl.  In 2011, the City prevailed on the first two claims, however, the Court of Appeals reinstated the matter of public nuisance claim in January, 2014.   In 2012, the Arizona Snowbowl began taking deliveries of reclaimed water for snowmaking purposes.   Representatives from the City and Hopi Tribe have negotiated for the past year a Settlement of their public nuisance claim.  To resolve the claim the City agrees to build and earthen-filtration system that will filter the reclaimed water that will be used by the Arizona Snowbowl.  This Settlement, which the Hopi Tribal Council unanimously approved on February 24, 2016, is a result of those negotiations.

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