Writing an Inter-Governmental Agreement

With increasing frequency, municipalities are finding it necessary to join forces to provide efficient utility services. As populations grow and converge, our water resources are stretched. Frequently, the most efficient means to provide utility service is to team with another municipality. These arrangements are typically governed by some sort of inter-governmental agreement (IGA).These IGA's can range from a simple letter of understanding to a more complex contract that determines who will spend millions of dollars for capital expenses. It is imperative for the utility manager to understand these agreements to avoid many of the common pitfalls. This paper will discuss the myriad issues that must be dealt with in an IGA and it will provide specific examples to illustrate some complex issues. Methods for cost sharing for both capital and operational expenses will be discussed, along with treatment, collection, conveyance and distribution costs.