MANCHESTER WATER DISTRICT, a Washington municipal corporation, hereinafter called "District" and PORT OF MANCHESTER, a Washington municipal corporation, hereinafter called "Port". The Port constitutes a port district with no paid staff. It owns and maintains real property (primarily the Manchester public dock and adjacent parking and picnic area real property) in the Manchester area of South Kitsap County. The Port receives property tax levy income, has an outstanding bond obligation, and incurs monthly "utility, services, and goods" debt obligations to maintain its assets .. Because it has no paid staff, it seeks to contract with the District to provide it with regular and ongoing accounting and accounts payable payment processing services. The District has the capability to provide these services and has agreed to supply them to the Port pursuant to the provisions of'this Agreement. NOW, THEREFORE, IN CONSIDERATION of the foregoing recitals, and the promises and covenants of the parties hereinafter set forth, they agree as follows: 1. Services to be Provided by District District shall perform the following accounting and accounts payable processing services ("Services") for the Port: A. It shall install and maintain on a District computer, accounting software, paid for by the Port, solely dedicated to maintaining the Port's accounting records; B. Thereafter, it shall provide accounting services for the Port identified as follows: it shall process the Port's accounts payable, as received from and approved by the Port's commissioners, on a monthly basis; it shall prepare the Port's payment vouchers for submittal to the Kitsap County Treasurer on a monthly basis; it shall reconcile the Port's bank account; and it shall facilitate payment of the Port's periodic bond repayment obligation; C. It shall prepare a monthly accounts payable report for the Port, and on a quarterly basis, prepare a "year-to-date" financial statement for the Port. The Port and District shall work together to determine the contents and format of these reports; and D. It shall backup the data maintained on its computer for the Port on a regular basis, according to the same schedule followed in backing up District data. 2. Port Obligations. The Port shall provide the District with all information requested by the District in a timely manner and in a format specified by the District, to enable the District to provide its Services hereunder to the Port in a timely and professional manner. To this end, the parties shall establish a schedule of dates and times each month by which the Port will submit all required information to the District, to allow it to perform its accounting/payment tasks for the Port in a timely manner. This schedule may be amended from time to time as conditions warrant.



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While this Agreement is in effect, the Port shall not contract with any other entities to provide it with the services contracted for herein. If the Port determines the District is deficient in any regard in supplying the Services contracted for herein, a representative from the Port shall arrange to meet with the District's General Manager to review the Port's alleged deficiencies and seek an appropriate resolution to the end that any deficiencies in the District's performance hereunder may be quickly brought to the District's attention and hopefully rectified. The Services provided by the District hereunder shall commence on 2006, but in no event shall these Services commence until the Port has paid (~ delivered to the District the accounting software and initial data to be utilized by the District on the Port's behalf. After commencement, this Agreement shall continue in effect on a month-to-month basis, indefinitely. It may be terminated at any time thereafter, and for any reason, by either party submitting notice to the other party, at least thirty days in advance of the termination date, which notice shall state: the party's intent to terminate the agreement; and the date when the termination shall be effective, which date shall fallon the last day of the month and year stated in the notice. On the termination date or within five business days thereafter, the District shall return to the Port all accounting software maintained on the Port's behalf, and an appropriate storage disk containing the Port's accounting data.

III 3. the R. day of




4. Compensation for Services. Port shall compensate the District as follows:

For the Services provided by the District, the

A. Set-Up Fee. The District estimates it will take its staff approximately eight hours to establish the Port's accounting software, and input the Port's necessary accounting data into its computer. The charge to the Port for this work shall be $200.00 due at the execution of this Agreement. Prior to the time the District's "set-up" work occurs, the Port shall be obligated to provide the District with the accounting software to be utilized or pay the District so it may purchase the software on the Port's behalf. Software options available to the Port are: QuickBooks Pro constituting a one-time purchase charge of approximately $220.00, including tax; or QuickBooks Pro On-Line, constituting an annual cost to the Port of approximately $265.00, including tax. At the inception of this Agreement, the Port shall also provide the District a flashcard, as designated by the District, to backup the Port's accounting data, or pay the District so it may purchase flashcard on the Port's behalf.
If the Port seeks to access the accounting data maintained on its behalf, it shall

also purchase an appropriate laptop computer and printer for this purpose, estimated to cost approximately $2,157.00, including tax. B. On-Going Service Fees. The ongoing monthly service fee to be paid by the Port to the District for maintaining its accounting books, and processing its accounts payable,




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shall be $179.00. This sum shall be due in advance, on the first day of each month this Agreement is in etfect. This monthly fee has been initially calculated as follows: Monthly Hours Hourly Rate $25 $25 $25 $25 Monthly Cost $100 $50 25 $4

(1) (2) (3)


Activity General Ledger Maintenance Processing SIP Vouchers Processing AlP with Kitsap County Treasury Debt Service Management

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C. Optional Services L Fees Those optional services the District is willing to provide to the Port at the following estimated monthly charges (calculated at present) are as follows: (1) Preparation of the Port's Monthly Agenda - $25.00; (2) District personnel attendance at the Port's monthly board meeting to take and transcribe the board's meeting minutes - $75.00 (based on meetings not lasting more than two hours); (3) Telephone Reception & Public Information Services provided for the Port - $75.00 (based on District time in this regard not to exceed three hours per month). If the Port seeks to obtain any of these optional services from the District, it shall enter into an addendum to this Agreement with the District stating which of the services its wishes to receive. The addendum shall also recap the total monthly service fee (On-Going standard fee plus elected optional service fees) to thereafter be paid by the Port to the District, which total fee shall be due in advance, on the first day of each month for which the Services are provided. If the Port requests the District to provide it with any additional services not specifically identified herein or any duly executed addendums hereto, if it is agreed by the District to supply such services, the District shall perform the services and bill the Port for them based on the District's standard charge for time, materials, and overhead ("TMO"). The Port shall promptly authorize payment of any TMO billings received from the District. D. Review of Service Fees. On an annual basis the District shall review the Services it provides to the Port and the fees it charges for those Services. If it finds that the cost to it to deliver these Services has increased, it shall notify the Port, and thereafter representatives from each party shall meet to re-negotiate the fees charged by the District hereunder, including when the re-negotiated fees shall become effective.
4. Professional Responsibility I Independent Contractor. The District represents that it possesses the professional skill and competence to frilly and completely undertake and complete all Services it has agreed to undertake hereunder in a timely and professional manner.


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The District's relation to the Port shall at all times be as an independent contractor. The District's contact person, who shall be its representative to the Port regarding its performance under this Agreement, shall be its General Manager, ALAN FLETCHER. The Port's contact person, who shall be its representative to the District regarding its performance under this Agreement, shall be Port Board Member, JIM STRODE. Either party may change its contact person, which change shall be effective after it notifies the other party of the name, address, and phone number of the new contact person.

s. Non-Assignment of Services. The Services to be provided by the District hereunder shall not be assigned or subcontracted without the prior express written consent of the Port.
6. Notices. All notices referenced in this Agreement, or issued pursuant hereto, shall be in writing, shall clearly set forth their purpose, and shall be signed and dated by the remitting party. A notice shall be deemed delivered to the receiving party: on the day it is personally served on that party, with that party signing a receipt therefore which is dated; or, within three business days from the day it is mailed by certified mail, return receipt requested, from a U.S. postal mailing site in Kitsap, Pierce, or King Counties, Washington. For purposes of mailing notices, notices to the District shall be sent to the following person at the following mailing address: MANCHESTER WATER DISTRICT c/o ALAN FLETCHER, General Manager POBox 98 Manchester W A 98353 and notices to Port shall be sent to the following person at the following mailing address: PORT OF MANCHESTER c/o JAMES STRODE, Commissioner PO Box 304 Manchester WA 98353 Either party may change the person to receive notices on its behalf, or mailing address at which it will receive notices, by notifying the other party of the changes in a timely manner. In the event any notices are personally served, the above named individual for the receipt of notices for his or her principal shall be the individual served on behalf of his or her principal. 7. Cooperation of Parties I Reasonable Interpretation. The parties shall strive to cooperate in a reasonable manner with one another, in good faith, at all times, so the terms and intent of this Agreement may be fully implemented. This Agreement shall be provided with a reasonable interpretation and not interpreted in favor of or against either party ACOUNTINGSERVICESAGREEMENTI MANCHESTER WATER DISTRICT & PORT OF MANCHESTER

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I ,

for the reason that both parties have had ample opportunity to negotiate with the other regarding the contents hereof 8. Dispute Resolution I Arbitration. In the event any disputes arise relating to the District's Services provided pursuant to this Agreement or stemming from this Agreement, the parties shall seek to meet in a spirit of cooperation and good faith bargaining to resolve all said disputes as soon as reasonably possible. In the event settlement of any disputes is not accomplished and if legal action becomes necessary hereunder, the parties agree the venue and jurisdiction of any such legal action shall reside in Kitsap County with the Kitsap County Superior Court. In the event of legal action, the parties further agree to submit any dispute(s) hereunder or relating to this agreement into arbitration pursuant to RCW Chapter 7.04, except as modified in this section and to provide the selected arbitrator with all jurisdiction (legal and equitable) to fully and completely settle all said disputes. When the need for arbitration arises, the party demanding arbitration, pursuant to RCW 7.04.060, shall serve upon the other party, according to the notice provisions hereof, written notice of its intent to arbitrate. Such notice shall state in substance that unless within twenty (20) days after its service, the party served therewith shall serve a notice of motion to stay the arbitration, the party receiving the notice shall thereafter be barred from putting in issue the existence or validity of this section fthis Agreement to arbitrate or the failure to comply herewith. Application to arbitrate, pursuant to RCW 7.04.030, shall be made by motion to the court. When the matter is placed into arbitration on the motion of either party, the court action shall be stayed. The arbitration shall proceed pursuant to the rules established in RCW Chapter modified in this section. One arbitrator shall be selected from the court's mandatory arbitration list in the same manner as established in RCW Chapter 7.06, and the local rules, dealing with mandatory arbitration. The taking of depositions, the issuance of Interrogatories, Requests for Production, and Requests for Admission, shall be specifically authorized as provided by law as if this said case were proceeding as a civil case in Superior Court. The arbitrator shall issue his or her decision in the same manner prescribed in RCW Chapter 7.06 within twenty (20) days from the close of the arbitration hearing. A party may appeal the decision of the arbitrator pursuant to RCW 7.06.050: within twenty (20) days after the filing of the arbitration award, the aggrieved party to perfect its appeal rights must file with the superior court clerk a written notice of appeal and request for a trial de novo in superior court on all issues of law and fact. Provided, however, pursuant to RCW 7.06.060, and local court rules, if the aggrieved party filing the appeal does not improve its position in superior court, that party shall have assessed against it, the other party's reasonable attorney fees and costs incurred from the date the notice of appeal was filed. ACO~GSERV1CESAGREEMrnNTI MANCHESTER WATER DISTRICT & PORT OF MANCHESTER
7.06 entitled ''MANDATORY ARBITRATION OF CIVIL ACTIONS", except as expressly

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The party who substantially prevails in any such arbitration action and/or court action shall be entitled to receive its reasonable attorney fees and costs of suit from the losing party. 9. No Third-Party Rights. This Agreement shall not create any rights or benefits to parties other than the District and Port. 10. Execution in Counterparts. This Agreement may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument. 11. Authorization of Each Party. Each party hereby represents to the other that it has duly considered and entered into this Agreement according to Washington Law through its duly designated representative(s}. The District approved execution of this Agreement at its regularly scheduled commission meeting held on the ____J.__l_ day of ~ , 2006, and the Port approved execution~ofthis Agreement at its regularly sche~ mmission meeting held on the _j_Q_ day of .& /~ , 2006. IN WI~S WHEREOF, we the undersigned have executed this Agreement to evidence our consent to the terms hereof as of the date appearing hereafter. DATED this _1j_day of





SiliVE P~ E:RSEN, Commissioner





/,,/0 ~




DATE: __ GA)COt1UlliSSioner

Ty,lL..!I...:.....f -J-/ =-o-=.b_


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by: JAMES STRODE, Commissioner





~~~~--------~------ROBERT PARKS, Commissioner




----------------------DANIEL FALLSTROM, Commissioner




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