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HomeMy WebLinkAboutOC WATER DISTRICT (OCWD)/GREEN ACRES PROJECT - 1990-08-06M AGREEMENT BETWEEN ORANGE COUNTY WATER DISTRICT AND THE CITY OF iUNTINGTON BEACH REGARDING DISTRIBUTION AND SALE OF GREEN ACRES PROJECT WATER THIS AGREEMENT, made and entered into as of, December 18, 1991, by and between the ORANGE COUNTY WATER DISTRICT (hereinafter, "OCWD") and the CITY OF HUNTINGTON BEACH (hereinafter, "RETAILER") . RECITALS A. OCWD was created by the OCWD Act, Ch. 924, Stats. 1933, as amended, for ,the purpose of protecting and managing the Orange County groundwater basin. The OCWD Act empowers OCWD to manage the groundwater basin, to provide for the conservation of the quantity and quality of water in the groundwater basin, to conserve and reclaim water within or outside of the boundaries of OCWD, to sell or otherwise put to beneficial use any water or reclaimed wastewater in order to conserve groundwater resources, and to distribute water to persons in exchange for ceasing or reducing the extraction of groundwater from the groundwater basin. B. OCWD purchases imported water from the Metropolitan Water District of Southern California (hereinafter "MWD"), through its member agencies, for spreading and replenishment purposes, and obtains wastewater from the County Sanitation Districts of Orange County (hereinafter "CSDOC") for renovation -reclamation and groundwater injection. C. Reclaimed wastewater currently produced by OCWD is suitable for a number of non -potable uses, including, but not limited to, landscape irrigation and industrial uses. J D. RETAILER is a municipal corporation organized and existing under the laws of the State of California. RETAILER provides retail water service to residents and water users within its 'jurisdictional boundaries, and produces and distributes groundwater as part of its retail water service. The jurisdictional boundaries of RETAILER are within the jurisdictional boundaries of OCWD. E. Landscape irrigation and industrial water users within the jurisdictional and service boundaries of RETAILER currently either purchase potable water from RETAILER for their use, or produce water from the groundwater basin by means of their own facilities for their own use, which private groundwater production is under the jurisdiction and control of OCWD. F. OCWD desire' -to construct, operate and maintain a water treatment facility, transmission mains and distribution pipeline system (including mainlines and service lines) and, in some cases, on -site plumbing, to be known as the "Green Acres Project," for the purpose of reclaiming wastewater received from CSDOC (hereinafter, "Project water") and distributing the Project Water for appropriate landscape irrigation and industrial purposes in order to supplement and conserve the supply of potable groundwater available to the residents and water users within th6 boundaries of OCWD. As of the date of this Agreement, OCWD has designed and commenced construction of facilities for the first phase of the Green Acres Project, to deliver Project Water for use within the boundaries of the cities of Santa Ana and Fountain Valley, the Mesa Consolidated 2 C Water District, and one user within the boundaries of RETAILER (hereinafter, the "Phase I Project Facilities"). OCWD desires to construct facilities for the second phase of the Green Acres Project, to deliver Project Water for expanded use within the boundaries of RETAILER (hereinafter, the "Phase I1 Project Facilities"). A plat depicting the Phase I and Phase II Project Facilities in Huntington Beach is set forth as Exhibit "A" hereto. G. OCWD and RETAILER mutually acknowledge that the use of reclaired water for landscape irrigation is of mutual benefit to OCWD and RETAILER in fulfilling their joint responsibilities for the conservation of water resources in accordance with Sections 13550 and 13551 of the California Water Code. H. OCWD desires to sell Project Water to RETAILER for resale by RETAILER to appropriate landscape irrigation and industrial water users within the service boundaries of RETAILER, and RETAILER desires to purchase Project Water from OCWD for such resale purposes. AGREEMENTS NOW, THEREFORE, in consideration of the facts recited above and the terms, covenants and conditions herein contained, the parties hereto agree as follows: rir SECTION ONE: FACILITIES FOR DELIVERY AND DISTRIBUTION OF PROJECT WATER 1.1 The parties acknowledge that OCWD has entered into a contract, and will be entering into additional contracts, for the 3 � v • construction of the Green Acres Project, and all facilities to produce, transport and distribute Project Water for the herein specified purposes (hereinafter, the "Project Facilities") . A plat depicting that portion of the Project Facilities which OCWD shall construct, operate and maintain within the boundaries of RETAILER is attached hereto as Exhibit "A". OCWD shall cause the Phase I Project Facilities to be completed and operational on or before October 1, 1991, and the Phase I1 Project Facilities shall be completed and operational on or before June 1, 1995; and RETAILER shall incur no cost or liability in connection with the design or construction of the Project Facilities. 1.2 The Project Facilities to be constructed shall include a distribution pipeline system from the site of the Green Acres Project Water Treatment Facility, to be located at 10500 Ellis Avenue, Fountain Valley, California, to the point of connection to each of the proposed Project Water customers within the boundaries of RETAILER (hereinafter, "Project Customers"), for the purpose of distributing Project Water to RETAILER at the points of connection of the Project Customers for purchase by RETAILER and resale to the 'f Project Customers. The names and anticipated annual Project Water demands of each Project Customer are set forth in Exhibit "B" hereto and incorporated herein by .his reference. 1.3 OCWD shall obtain all permits required to'construct• and operate the Project Facilities, including the distribution pipeline system and ancillary facilities to be located within the public rights of way as shown on Exhibit "A" hereto, as well as those 4 facilities which are necessary to produce, deliver and distribute Project Water for the herein described purposes; and OCWD shall further obtain those permits that Project Customers may be required to obtain. OCWD shall cause the Project Facilities within the boundaries of RETAILER to be constructed in accordance with the construction standards of RETAILER in effect as of the date of the award by OCWD of the contract or contracts for such construction. The Project Facilities shall be owned by OCWD,• provided, however, that RETAILER shall perform on behalf of OCWD all maintenance, repair and replacement of the Project Facilities located within the boundaries of RETAILER, pursuant to paragraph 4.1 hereinbelow. 1.4 OCWD shall, at no cost to RETAILER, provide a metering device meeting RETAILER's specifications, to be owned, operated and maintained by RETAILER', for the purpose of measuring the quantity of•Project Water purchased by RETAILER and resold by RETAILER to each Project Customer. RETAILER shall be responsible for ensuring the accuracy of the metering device. Any costs incurred in modifying the size of existing P.ETAILER meters shall be the responsibility of OCWD. The quantity of Project Water measured by the meters to be owned, operated and maintained by RETAILER shall be the sole basis for determining the quantity of Project Water delivered and sold by RETAILER tp each Project Customer under Section Two of this Agreement. In the event that a raeter measuring the quantity of Project Water delivered by RETAILER to a Project Customer indicates a lesser quantity than OCWD*s meter measuring the quantity of Project Water delivered to RETAILER for resale to a Project Customer, OCWD shall be responsible for the cost of such difference, and RETAILER shall not be liable therefor. In the event RETAILER has a separate metering device serving exclusively non -potable uses on the premises of a Project customer, OCWD may sell Project Water to RETAILER by connecting the Project Facilities distribution pipeline system directly to the separate non -potable meter so long as the standards and requirements of RETAILER and any other governmental agency having jurisdiction over the quality of Project Water are satisfied. 1.5 In order to avoid the risk that Project Water may enter into RETAILER's potable water distribution system, OCWD shall, at its own expense, install on RETAILER"s potable water system a backflow prevention device or devices approved by RETAILER at a location or locations% designated in writing by RETAILER. Such backflow prevention devices shall be installed prior' to the commencement of deliveries of Project water to a particular connection point. OCWD shall provide for separate marking of the non -potable Project Water system in accordance with standards and regulations in existence as of the date of this Agreement. 1.6 The Project Water distribution pipeline system shall"be constructed by OCWD with sufficient capacity to allow RETAILER to serve known Landscape irrigation arrl industrial water users. OCWD shall sell to RETAILER, and RETAILER shall purchase frog► OCWD, sufficient quantities of Project Water for RETAILER to sell to the projected Project customers as shown on Exhibit "B, " and such other and future Project Customers as are provided for herein, but only to the extent that RETAILER has contracts with such other and future Project Customers for the sale of Project Water; provided, however, that a water user within the service boundaries of RETAILER shall become a Project Customer only with the approval of both OCWD and RETAILER; and provided further, that OCWD shall have the sole discretion to determine whether to expand the Project Facilities or the production and distribution capacity of the Project Facilities to meet any future demand for Project Water that may be generated within the boundaries of RETAILER. In this. regard, the listing of Project Customers attached hereto as Exhibit "B" represents a listing of both the known Project Customers as of the date of this Agreement, and potential future Project Customers. OCWD and RETAILER mutually understand and agree that additional landscape irrigation and/or industrial water users within the boundaries of RETAILER may at some future time be served with Project Water and become Project Customers without the necessity of amending this Agreement. All future water users within the service boundaries of RETAILER who become Project Customers shall execute an agreement for the purchase of Project Water in the form attached hereto as Exhibit etc", and further shall be subject to the Project Rules to be adopted by RETAILER pursuant to paragraph 5.3 hereinbelow. ; SECTION TWO: PURCHASE AND BALE OF PROJECT WATER 2.1 OCWD shall complete the construction and commence operation of the Phase I Project Facilities by October 1, 2991, and 7 s the Phase II Project Facilities by June 1, 1995, barring delays due to unforeseeable causes beyond the control and without the fault or negligence of OCWD or its contractors. If OCWD is permitted by all regulatory agencies having jurisdiction over OCWD to distribute Project Water, then, during the term of this Agreement, RETAILER shall have the exclusive right to purchase Project Water from OCWD, at the point of connection to each Project Customer, and to resell Project Water to the Project Customers shown on Exhibit "B," and such other landscape irrigation and industrial water users within the boundaries of RETAILER that may be added as Project Customers in accordance with paragraph 1.6 above. 2.2 Concurrently with and as a condition precedent to any obligations of OCWD or RETAILER pursuant to this Agreement, RETAILER shall enter 'into separate agreements with the proposed Project Customers, in substantially the fora to be attached hereto as Exhibit "C" upon preparation of a form mutually acceptable to OCWD and RETAILER, for the purchase by Project Customers of Project Water from RETAILER contingent upon its availability from OCWD. The terms and conditions of such agreements between RETAILER and s Project Customers shall be in conformance with the terms and conditions of this Agreement. In the event RETAILER and other purveyors of ,Eroject Water are unAble by January 1, 1993 (or as otherwise agreed to in writing by OCWD) to enter into agreements for the sale of at least fifty percent (50%) of the total demand, as set forth in Exhibit "B," for Phase I and Phase II Project Water each year during the term hereof, this Agreement shall terminate. 8 2.3 RETAILER shall commence the purchase and resale of Project Water upon receiving at least sixty (60) days advance written notice from OCWD of the availability of such Project Water. -2.4 RETAILER shall purchase the Project Water from OCWD, at the point of its metered connection, for an amount to be determined by the OCWD Hoard of Directors in its discretion, not to exceed eighty percent (80%) of the "area groundwater cost" as defined in Section 2.5 hereinbelow. The point of connection and sale of the Project Water from OCWD to RETAILER shall be at the meter which neasures the flow of Project Water to each Project Customer, as described in Section 1.4 hereinabove. 2.5 For the purpose of this Agreement, the "area groundwater cost" shall be the same as the fixed and variable costs of groundwater production'as listed in the most recent OCWD Engineer's Report prepared pursuant to Section 31,5(a) of the OCWD Act, plus the replenishment assessment imposed by OCWD pursuant to the authority contained in Section 27 of the OCWD Act, and any additional replenishment assessments which may be imposed by OCWD pursuant to the authority contained in Section 27.1 of the OCWD Act, which replenishment assessments and additional replenishment assessments are established in April of each year but do not become effective until, the following July of each year. The parties mutually recognize and agree that the area groundwater cost may change each year during the term of this Agreement, as a function of changes in the cost of operation and maintenance, energy, the Z replenishment assessment levied by OCWD, and the levy of any additional replenishment assessment by OCWD. 2.6 The governing body of RETAILER shall establish the rate for •the resale of Project Water to each Project customer, in an amount not to exceed eighty percent (80%) of the "potable water" rate established by RETAILER. 2.7 RETAILER shall read the Project Water meter for each Project Customer on a sixty (60) day cycle. The Project Water meter reading date shall coincide with RETAILER'S reading of the meter which measures the quantity of potable water delivered by RETAILER to the Project Customer that month. Within sixty (60) days thereafter, RETAILER shall transmit to OCWD a statement setting forth the Project Water rate established by RETAILER pursuant to paragraph 2-6 during that billing period, a description of the maintenance, repair and replacement activities of RETAILER, and the amount of such actual costs incurred by RETAILER, pursuant to Section .4.1 hereinbelow during that billing period, and indicating, for each Project Customer, the current meter reading, the previous meter reading, and the total quantity of Project Water % purchased from OCWD and resold by RETAILER to such Project Customer during the billing period. Together with this statement, RETAILER shall transmit :to OCWD payment in %ccordance with paragraphs 2.4 and 2.5 for the Project Water purchased from OCWD by RETAILER and resold by RETAILER to all of the Project Customers during the billing period, after deducting therefrom the actual costs incurred by RETAILER in maintaining, repairing and replacing the Project 10 Water distribution system within RETAILER's boundaries as set forth in Section 4.1 hereinbelow. • SECTION THREE: PROJECT WATER QUALITY,REGULATIONS 3.1 OCWD shall deliver and sell to RETAILER pursuant to this Agreement Project Water that shall conform to all current and future requirements established by the California Regional Water Quality Control Board - Santa Ana Region, and all other federal, state and local agencies having jurisdiction to fix minimum standards for the anticipated landscape irrigation and industrial uses of the Project Water by the Project Customers listed in Exhibit "B" hereto. The anticipated quality of Project Water shall be as shown on Exhibit I'D" attached hereto and incorporated herein, or as subsequently amended to conform to any future regulatory requirements for such use; provided, however, that OCWD shall not have any obligation to modify the quality of Project Water to meet the needs of any particular Project Customer. 3.2 During the term of this Agreement, OCWD shall pay all costs imposed by any and all governmental agencies having `. jurisdiction over the quality or use of Project Water for -the issuance of any permits, licenses or approvals required for the production, treatment, distributiorr,or sale of Project Water. OCWD further shall be responsible for paying any charges,. fees, surcharges, assessments or other sums imposed or levied upon Project Water by the Municipal Water District of Orange County or the Coastal Municipal Water District of Orange County. 11 3.3 OCWD shall inform RETAILER promptly after becoming aware of any proposed or actual modifieaticns by any agency having jurisdiction over the quality of Project Water to any requirements governing the minimum standards of quality for or use of Project Water, or of any changes in the legally permissible uses which might affect the use of the Project Water sold by OCWD to RETAILER for resale by RETAILER to Project Customers, and OCWD shall bear all costs of conforming to any such future requirements. RETAILER shall have no obligation to pay the cost of meeting any future requirements governing the standards of quality for, or use of, Project Water. SECTION FOUR: OPERATING OBLIGATIONS OF THE PARTIES 4.1 During the term of this Agreement, OCWD shall manage, operate and maintain the Project Facilities in an efficient manner and in accordance with the highest standards of skill and workmanship; provided, however, that OCWD hereby contracts with RETAILER for the performance by RETAILER .)f the actual maintenance, repair and replacement responsibilities with respect to those Project Facilities located within the service boundaries' of RETAILER. RETAILER recognizes the special quality considerations relating to Project Water, and, RETAILER shall perform its maintenance, repair and replacement responsibilities in an efficient banner and in accordance with the highest standards of skill and workmanship. OCWD retains the right to make repairs to Project Facilities within the service boundaries of RETAILER if 12 they are not made by RETAILER in a timely or efficient manner. RETAILER shall receive as a credit against all monies due OCWD pursuant to paragraph 2.8 hereinabove for the sale of Project Water the •cost of such maintenance, repair and replacement activities actually undertaken by or on behalf of RETAILER, which costs shall include the actual labor, material and equipment costs, plus overhead costs, incurred by RETAILER and necessary for such maintenance, repair and replacement activities. 4.2 Notwithstanding the provisions of paragraph 4.1, the operating responsibility of OCWD with respect to the Project Facilities shall include the maintenance of quality, quantity and pressure of the Project Water, and compliance with all regulatory requirements and conditions applicable to the distribution and sale of Project Water, to-. the point of connection to each Project Customer. 4.3 RETAILER shall, at no cost to OCWD, assume ownership of, service, maintain and read the Project Water meter and valve set and meter box/vault for each Project Customer in the same manner that RETAILER would for a customer service meter attached to its potable water system. RETAILER further shall, at no cost to OCWD, be responsible for customer service functions relating to Project Customers, including but not limitgd to billing and collection of payments from Project Customers for the Project Water, record keeping, and notification to OCWD of the quantity of Project Water delivered through the Project Customer's meter during each meter reading period. 13 4.4 OCWD shall have the right to review the books, records and accounts maintained by RETAILER relating to the Project Water and Project Customers during normal business hours, upon forty-eight (48) hours prior written notice to RETAILER. 4.5 OCWD shall operate the Project Facilities in such a manner that Project Water shall be delivered to the point of connection to each Project Customer on a continuous basis at a pressure of not less than sixty (60) pounds per square inch between the hours of 8:00 p.m. and 6:00 a.m. , and not less than twenty (20) pounds per square inch between the hours of 6:00 a.m. and 8:00 p.m. 4.6 Except as provided in paragraph 9.6 hereinbelow, in the event that, at any time during the term of this Agreement, OCWD for any reason cannot or chooses not to produce Project Water from its Green Acres 'Project Water Treatment Facility described in paragraph 1.2 hereinabove, OCWD shall provide through the Project Facilities, or otherwise, -at a cost equal to the cost of Project Water, sufficient water of a quality at least equal to the quality of Project Water to meet the landscape irrigation and industrial water needs of all of the Project Customers; provided, however, that OCWD shall have no such obligation in the event that Project Water cannot be delivered to Project Customers due to damage to, breaks or other disruptions in the distribution facilities transporting Project Water to Project Customers. 14 SECTION FIVE: PROJECT WATER RULES AND REGULATIONS 5.1 All Project Water produced by OCWD for delivery and sale to RETAILER shall be in accordance with the terms and conditions of the discharge requirements and primary user permit for the Project Water issued to OCWD by the California Regional Water Quality Control Board - Santa Ana Region. OCWD has obtained and shall maintain a blanket primary user permit for the production, distribution and sale of Project Water, and shall at all times maintain such permit and bear all costs in complying with all present and future provisions thereof and all renewals or subsequent such permits. 5.2 OCWD shall promulgate and enforce rules and regulations regarding the distribution, delivery and sale of Project Water to RETAILER, and governing the use of Project Water resold by RETAILER to Project Customers (hereinafter, the "Project Rules"). OCWD shall pay all costs incurred in the drafting and preparation of the Project Rules. OCWD shall obtain all requisite certifications and approvals from all federal, state and local agencies having jurisdiction over the production, quality and use of Project Water, including, but not limited to, the California Regional Water Quality Control Board - Santa Ana Region, and the State of California Department of Health, that such Project Rules comply with the regulations, requirements and orders of such regulatory agencies. 5.3 OCWD shall transmit to RETAILER such approved Project Rules for adoption by RETAILER, and RETAILER shall, within ninety 15 (90) days after receipt thereof, incorporate the Project Rules into RETAILER's promulgated rules and regulations governing the distribution, delivery and sale of 'water within the service boundaries of RETAILER. Promptly upon adoption, RETAILER shall transmit to OCWD RETAILER'S adopted Project Rules, and RETAILER shall notify OCWD of any amendments to or modifications of the Project Rules adopted by RETAILER. Should OCWD choose either to make reasonable amendments or modifications to the Project Rules not contrary to this Agreement, or be required by any governmental agency exercising jurisdiction over the distribution, sale or use of the Project Water to modify or amend the Project Rules, OCWD shall promptly furnish such modifications or amendments to RETAILER; and RETAILER shall, after being provided a ninety (90) day period in which to'review, comment upon, and/or Meet and confer With OCWD regarding such proposed modifications or amendments, incorporate such modifications or amendments into RETAILER's adopted rules and regulations. 5.4 RETAILER shall include in its promulgated rules and regulations provisions requiring, whenever feasible and if Project : Water is available, that any new or future customer of RETA11,:R, as a condition to receiving potable water service from RETAILER, to become a PrO ect Customer and tp accept and use Project Water in lieu of-RETAILER's potable water supply for appropriate landscape irrigation and industrial purposes. RETAILER shall further include in its promulgated rules and regulations a requirement that any new or future Project Customer permit representatives of OCWD and RETAILER to enter the premises of the Project Customer at all reasonable times for the purpose of monitoring, inspecting, analyzing and observing the Project Customer's on -site Project Water facilities and the utilization by the Project Customer of Project Water. 5.5 For purposes of paragraph 5.4 of this Agreement, "feasibility" shall be presumed if OCWD and RETAILER mutually determine in their discretion that Project Water is available and that the Project Facilities can acconnodate the new or future landscape irrigation or industrial water customer of RETAILER. For purposes of section 5.4 of this Agreement, the use of Project Water for landscape irrigation or industrial uses shall be presumed "appropriate" if the use of Project Water by a new or future Project Customer for landscape irrigation or industrial applications will neither violate any minimum water quality or health standards established by any federal, state or local agency having jurisdiction over the quality of Project Water, nor significantly and adversely affect either the Project Customer's plantings or the industrial processes or products served by the Project Water. 5.6 In connection with RETAILER's adoption of the Project Rules as part ,of its rules and regAlations, and at the request of r- RETAILER, OCWD shall cooperate with and assist RETAILER an obtaining from the State of California Water Resources Control Board any necessary certifications, findings or orders authorized under Sections 13550 and 13551 of the California Water Code to 27 require the use of Project Water for landscape irrigation uses within the service boundaries of RETAILER. 5.7 The parties understand and agree that Project Water delivered and sold by OCWD to RETAILER pursuant to the terms of this Agreement has limited uses, and OCWD shall deliver and sell to RETAILER Project Water only for those uses and purposes which are legally permissible under the laws of the State of California and the rules, regulations and directions of the appropriate federal, state and local regulatory agencies exercising jurisdiction over the quality and use of Project Water. In this regard, OCWD and RETAILER shall cooperatively enforce Project Rules limiting the use of Project Water to legally permissible landscape irrigation and industrial applications, and shall :monitor the use of Project Water by Project Customers to safeguard against any misuse or improper application of Project Water by Project Customers. SECTION SIX: PROJECT WATER DELIVERY TO EXCLUSIVE GROUNDWATER USERS i 6.1 This Section Six shall apply only with respect to water users located within the Green Acres service area boundaries and within the service boundaries cf R-TAILER who, as of the date of this Agreement, are not presently served potable water by RETAILER for their landscape irrigation uses, but who rely instead exclusively upon their own private groundwater production to 18 satisfy their landscape irrigation demands (such water users are hereinafter referred to as "Groundwater Customers"). 6.2 With the assistance and cooperation of OCWD, RETAILER shall use its best efforts to enter into agreements with each Groundwater Customer, under which the Groundwater Customer shall agree not to produce groundwater to satisfy its landscape irrigation demands, and purchase from RETAILER and use Project Water in lieu of groundwater for landscape irrigation purposes. In consideration for purchasing and using Project Water in lieu of groundwater, RETAILER shall sell Project Water to each Groundwater Customer at a rate equal to the variable groundwater production cost, including any Replenishment Assessment and additional Replenishment Assessment imposed by OCWD pursuant to Sections 27 and 27.1 of the OCWD Act, as shown in the most recent OCWD Engineer's Report prepared pursuant to Section 31.5(a) of the OCWD Act. 6.3 RETAILER shall read the Project Water meter for each Groundwater Customer at the same time during each sixty (60) day cycle, and shall perform the same customer service functions for ' Groundwater Customers that RETAILER performs for Project Customers' pursuant to paragraph 4.3 hereinabove. 6.4 Within sixty (60) days ;after reading the meters of Groundwater Customers as set forth in paragraph 6.3 hereinabove, RETAILER shall forward to OCWD a statement indicating, for each Groundwater Customer, the current meter reading, the previous meter reading, and the total quantity of Project Water delivered and sold 19 to RETAILER for resale to such Groundwater Customer during the billing period, together with payment for the Project Water purchased by all Groundwater Customers during the preceding- month. The payments to be made by RETAILER to OCWD herein shall comprise the amounts actually owed by each Groundwater Customer to RETAILER, less a sum representing ten dollars ($10.00) for each acre foot of Project Water purchased by the Groundwater Customers from RETAILER. Commencing in the year in which Project Water deliveries commence under this Agreement, the credit to RETAILER of ten dollars ($10.00) shall be adjusted annually in accordance with the Consumer Price index published by the United Stated Department of Labor for the Long Beach - Santa Ana - Anaheim metropolitan area. This annually adjusted credit to RETAILER shall serve as full and adequate compensation*- to RETAILER for the costs incurred by RETAILER in assuming ownership of, servicing, maintaining and reading the Project Water meter for each Groundwater Customer in the same manner that RETAILER would for a customer service Deter attached to its potable water system, and for providing to the Groundwater Customers those customer services functions provided by RETAILER to Project Customers pursuant to paragraph 4.3 hereinabove. 6.5 In the event either that a, Groundwater Customer abandons its groundwater production facility or that OCWD determines that a Groundwater Customer is no longer capable of producing groundwater for its landscape irrigation needs, OCWD shall have the exclusive authority and discretion, without the necessity of 20 amending this Agreement, to remove such water user from the designation of "Groundwater Customers." In such event, the former Groundwater Customer shall be treated as a Project Customer for all purposes hereunder, including but not limited to the retail sale of, and billing and payments for, Project Water. SECTION &EVEN: INDEMNITY AND INSURANCE 7.1 OCWD shall save RETAILER harmless from and against and shall indemnify RETAILER from any liability, loss, costs, expenses or damages however caused by reason of any injury (whether to body, property, or personal or business character or reputation) sustained by or to any person or property by reason of any act, neglect, default, or omission of OCWD or any of its agents, employees, or representatives, or caused by reason of the design, construction, operation or maintenance of the Project Facilities, or the distribution and sale to RETAILER for resale purposes herein of Project Water that does not meet the quality standards set forth in Title 22 of the California Code of Regulations; provided, however, that OCWD shall not be responsible for the negligent ; operation, maintenance or repair of the Project Facilities within RETAILER'S service boundaries by RETAILER, the negligent operation, maintenance or repair by RETAILMF or any Project Customer or Groundwater Customer of Project Water distribution and storage facilities located on the lands of any Project Customer or Groundwater Customer, and/or the misuse or misapplication of the Project Water on the Project Customer's or Groundwater Customer's 21 k", side of the Project water meter by any person, including RETAILER or any Project Customer or Groundwater Customer. If RETAILER is sued in any court for damages by reason of any of the acts for which OCWD is required to indemnify RETAILER in this paragraph 7.1, including but not by way of limitation, damages arising out of a products liability claim, OCWD shall defend said action (or cause same to be defended) at its own expense and shall pay and discharge any and all amounts of judgment that may be rendered in any such action. If OCWD fails or neglects to so defend in said action, RETAILER may defend the same and any expenses, including reasonable attorneys' fees, which it may pay or incur in defending said action and the amount of any judgment which it may be required to pay shall be promptly reimbursed upon demand. Nothing herein is intended to --nor shall it relieve RETAILER or any Project Customer or Groundwater Customer from liability for its own acts, omissions, or active or passive negligence. 7.2 OCWD shall cause RETAILER to be named as an additional insured on OCWD's general liability policy of insurance with respect to the sale and distribution to RETAILER of Project Water within the service boundaries of RETAILER, and OCWD shall provide RETAILER with certificates of insurance and endorsements evidencing such insurance coverage, provided/ however, that nothing shall .. «:. preclude OCWD from maintaining self insurance with respect to the sale, distribution and use of Project Water, in lieu of purchasing insurance as provided for herein. 22 7.3 OCWD shall not commence nor permit any contractor or subcontractor to commence work on construction of any of the Project Facilities that are located within the service boundaries of RETAILER until OCWD has obtained, or has caused its contractors to obtain, comprehensive general liability insurance providing coverage for bodily injury, personal injury and property damage, and which shall include as additional insureds RETAILER, its officers, agents and employees, but only while acting in their capacity as such and only as respects operations of the original named insured, its subcontractors, agents, officers and employees in the performance of the construction 'Contract. OCWD shall furnish RETAILER with certificates of insurance and endorsements showing insurance coverage as described above. RETAILER shall incur no expense in connection with obtaining and maintaining any insurance required under paragraphs 7.2 and 7.3. SECTION EIGHT: PISPUTES S. 1 In the event of any dispute arising under this Agreement, the parties hereto agree to utilize the arbitration procedure set forth in this Section Eight as the sole and exclusive means' of resolving any such dispute. 8.2 Arbitration shall be initiated by any party hereto serving upon any other party a written demand for arbitration, which demand shall describe with specificity the nature of the dispute. Except as specified herein, the arbitration shall be conducted pursuant to the provisions of California Code of Civil 23 Procedure, Section 1280, et sea. The parties hereto agree that there shall be a single neutral arbitrator who shall be a civil engineer knowledgeable in water facilities operation and reclaimed wastewater, who shall be selected in the following manner: (A) The demand for arbitration shall include a list of the names of five (5) persons acceptable to the demanding party for appointment as arbitrator. The responding party shall determine if any of the names submitted are acceptable, and, if so, shall inform the other party within ten (10) days of actual receipt of the arbitration demand, and such person will be designated as arbitrator; (B) In the event that none -of the names submitted by the demanding party is acceptable to the responding party, or if for any reason the arbitrator selected is unable to serve, the responding party shall submit to the demanding party a list of the names of five (5) persons acceptable to the responding party for appointment as arbitrator. The demanding party shall in turn have ten (10) days from actual receipt of the list in which to determine if one such person is acceptable; (C) If the parties are unable mutually to agree upon a neutral arbitrator as described above, the matter of the selection of an arbitrator, qualified as above, shall' be submitted to the Orange County Superior Court pursuant to Code of Civil Procedure.Section 1281.6. Upon selection of an arbitrator, the arbitration shall be conducted consistent with the provisions of Code of Civil Procedure section 1280, et seg., as are deemed practicable by the arbitrator, considering the nature of the dispute. 24 8.3 The costs of arbitration, including but not limited to reasonable attorneys' fees, shall be recoverable by the party prevailing in the arbitration. If an arbitration conducted hereunder is appealed to a court pursuant to the procedures set forth in Code of Civil Procedure Section 1280, et sec., the costs of arbitration shall also include court costs associated with such appeals, including but not limited to reasonable attorneys' fees. SECTION NINE: XTSCELLANEOUS PROVISIONS 9.1 Notiges: All notices, payments, transmittals of documentation and other writings required or permitted to be delivered or transmitted to any of the parties under this Agreement shall be personally served or deposited in a United States mail depository,' -first class postage prepaid, and addressed as follows: If to OCWD: Orange County Water District 10500 Ellis Avenue P.O. Box 6300 Fountain Valley, California 92708 Attn: William R. Mills Jr., General Manager If to RETAILER: City of Huntington Beach P.O. Box 190 Huntington Beach, California 92648 Attn: Mr. Jeff Renna, Water Superintendent or such other address as OCWD or RETAILER shall direct in writing. Service of ariy"instrument or writing by mail shall be deemed complete forty-eight (48) hours after deposit in a United States mail depository. 9.2 Term and Amendment: The term of this Agreement shall be for twenty --five (25) years from the date hereof. This Agreement 25 shall automatically be extended for up to five (5) extensions of five (5) years each, for a possible total extension of twenty-five (25) additional years to the initial term hereof, if neither party hereto exercises its right to terminate the extensions to the initial term of this Agreement. Either party shall have the right to terminate any extension to the initial terra of this Agreement by written notice to the other at least four (4) years prior to the expiration of the initial term or any extension of this Agreement. Except as provided in paragraph 1.6 and Section Six hereinabove, this Agreement may only be amended or modified by mutual agreement in writing of OCWD and RETAILER. 9.3 Limitation on Sales by OCWD: OCWD acknowledges and agrees that, except as provided herein or with the prior written consent of RETAILER, OCWD is not now and will not in the future become a wholesale or retail seller of Project Water within the service boundaries of RETAILER, and OCWD further agrees that it will not use or contract with any entity other than RETAILER for the purpose of selling and distributing Project Water within the service boundaries of RETAILER. 9.4 as iri to o s: OCWD and RETAILER mutually understand and agree that any and all Project Water delivered and sold by OCWD hereunder shall. not constitute either "supplemental sources" or "groundwater supplies" for the purpose of the annual establishment of basin groundwater production requirements and limitations by OCWD pursuant to Section 31.5 of the OCWD Act. Project Water is 26 V hereby established as a separate class of water for the purposes of Section 31.5•of the OCWD Act. 9.5 Conditions Precedent: The performance of this Agreement is conditioned upon OCWD's being able to acquire acceptable rights of way and access rights from its existing facilities to the points of connection to Project Customers, as set forth in the plat attached hereto as Exhibit "A", and the approval by the State of California of funding for the construction of the Phase II Project Facilities. The performance of this Agreement is further conditioned upon the approval by all federal, state and local regulatory agencies having jurisdiction over the Green Acres Project and Project Water. 9.6 Conditions SubseMent: The performance of this Agreement is conditioned upon OCWD's continued ability feasibly to produce and distribute Project Water for sale. to RETAILER and resale by RETAILER to Project Customers in a cost --effective manner. Subsequent to the date of this Agreement, should OCWD determine in its sole discretion that unanticipated increases in the cost of producing or distributing Project Water or new or modified ' regulatory requirements governing the production, distribution, quality or use of Project Water render the Green Acres Project economically.. asible, OCWD may cease production and distribution of Project Water upon ninety (90) days written notice to RETAILER. In the event that OCWD ceases the production and distribution of Project Water pursuant to this paragraph 9.6, this Agreement shall terminate and OCWD shall incur no liability to RETAILER or any 27 t 1 Project Customer or Groundwater Customer by reason of the termination of this Agreement or the termination of production and delivery of Project Water; provided, however, that if OCWD ceases the production and distribution of Project Water pursuant to this paragraph 9.6 within ten (10) years irmediately following the date of this Agreement, OCWD shall pay the cost of connecting or reconnecting the landscape irrigation or industrial water facilities of each Project Customer or Groundwater Customer then connected to the Project Facilities to the domestic water distribution facilities of RETAILER. 9.7 No Duvlication of Services Intended or Created: OCWD and RETAILER mutually understand and agree that the construction and operation of the Project Facilities and the distribution and sale of Project'.Water by IDCWD to RETAILER for sale by RETAILER to Project Customers pursuant to this Agreement do not constitute either a duplication of RETAILER's retail water service or a taking of any property of RETAILER within the meaning of Section 1501, et seq of the California Public Utilities Code. RETAILER shall have no right to institute any action against OCWD pursuant to Sections 1503, 1504 or 1505.5 of the Public Utilities code by reason of the construction and operation of the Project Facilities and the distribution.. ,and sale of Project 'Water by OCWD to RETAILER in conformance with this Agreement. 9.8 Warranty: OCWD represents and warrants that under the OCWD Act OCWD, without the consent of any other public agency water purveyor, may enter into this Agreement to deliver and sell Project 28 Water to RETAILER for resale by RETAILER to Project Customers or lands within the service boundaries of RETAILER. 9.9 Construction: This Agreement shall be construed according to its plain meaning and as if prepared by all parties hereto. This Agreement shall be governed by and construed in accordance with the laws of the State of California. 9.10 Integration: The parties herein have set forth the Whole of their agreement, and the performance of this Agreement constitutes the entire consideration intended herein. 9.11 Successors: This Agreement and all of the provisions herein, shall, be binding upon and inure to the benefit of OCWD and RETAILER, and their respective successors and assigns. WHEREFORE, the parties herein have executed this Agreement as of the date'set forth above. APPROVED AS TO FORM: RUTAN & TUCKER By,r'),0"fag A/J General Counsel f Orange Orange County water District District APPROVED AS TO FORM: By / wr C `--r City Attorney, t of lly,q( ington Beacha. rfo: -.41 8/131/006104-0124/005e MA-CRE=E MAIL. I ORANGE CO A R DISTRICT By - e By General M6n t CIT UNTINGTON ]BEACH, By Mayor -- 00 Attest ^ .:City Cl k f. 29 Von" AVID" rrYsww�IM %y♦ win wsorwww �w�wlr ' �1%1` %, , \♦,\R t . ♦R\\,�♦,♦,\,TALDERT Ayr" zz \�\R\a\, t Full rr „" ,,,,,,,♦,\,,,, ,,,\„ ,,,,,,,,,OeAAGLr caw IMfCX QrJ1ACr \ \,,,,,,,♦♦,R\♦.,.,,, \ lbw `kid"mWt �ll�'![�„\ wwrsr w�V�i+� 7/ �i ,..,,,,;♦,♦,♦♦,♦:;;,\,.♦♦ ♦:,♦R♦♦♦,,.• is , ,,.♦.♦ ♦,♦,,,�„RRR ,,,♦♦♦♦\,,,\ \,♦,\,♦,♦, M\•. ,•\,\, \\ ,• HUNTMTON BEACH L!GlND POTENTIAL RECLAlMAED WATER USERS* MEEN AitK1 TMJIT►OfT NLA1fT f Mu fiKtl! RrSC�R • •CL•.� •G OCI�LIIeR O ORANGE COUNTY WATER OtS RICT �w DOTIrUT10M ►ACUM —PH A29 1 2 CITY FAW/=F COLM r CPAM i[ MM" LMM PMK 3 HLWTNQTM CEWTM pom • EIAVTW fwK GAM ACTIES PROACT •-14MMf4GTQ/4 1lIsrACN • r r w MTMV" M TACLffU -PHAM d 4 OMAN VIEW HIM ODOl • MEACI"aw COU10E M OPOSED D"rngAIJTM FAOL MS AMD 'NOTE: ALL OWN AM LlM "PILAW N EXCEPT i 1tADOWUM acLF COMM f • VILLAO[ Y POTENTIAL RECLAM" MTiA 1JIEETts TOIL VLLAOE MRSEMY IN PHASE I + COMITY •A)wTt< 014 PLANT I/O, ! Mor*narm MXLWT 1 MO ExhRgt A EXHIBIT' "B' HUNTINGTON BEACH POTENTIAL RECLAIMED WATER DEMANDS Peals Demand Avera❑s Demand Nit Day Potential Use AF rr, Q= g-m gam - Phase 1 Village Nursery Holly Seacliff Development City Park/Golf Course Huntington Central Park Ocean View High School Meadowlark Golf Course Eolsa Chica Development Orange County Linear Park Elufftop Park Seacliff Goff Course County Sanitation Plant No. 2 TOTAL 208 129 774 774 836 518 3,108 1,658 290 180 1,080 576 200 124 744 397 75 46 276 147 175 108 648 345 452 280 1,680 896 395 245 1,470 784 50 31 186 99 150 93 558 298 - -DZZ —Q _3,240 2 24Q 3,703 2,294 13,764 9,214 EXHIBIT `Go FORM OF PROJECT CUSTOMER SALES AGREEMENT (To Be Provided by City of Huntington Beach) EXHIBIT "D" TYPICAL WATER QUALITY TO BE SUPPLIED TO GREEN ACRES CUSTOMERS Total Dissolved Solids Hardness Calcium Magnesium Potassium Sodium Bicarbonate Chloride Sulfate Boron Fluoride Silica Nitrogen - Total N Prosphorus - Total P Chemical Oxygen Demand mq/L 950 - 11050 300 - 350 80 - 100 20 - 25 12 - 14 190 - 240 260 - 280 230 - 300 220 - 240 0.6 - 0.B 1.1 -- 1.5 21 - 24 20 - 30 5.0 - 5.6 30 - 40 r r i REQUEE,; FOR CITY COUNCiI,.)ACT[ON Data _ A lust 6, 1990 Submitted to: Honorable Mayor and City Council Submitted by: Michael T. Oberuaga, City Administrator Prepsred by: TX.Louis F. Sandoval, Director of Public Works Subject; GREEN ACRES RECLAIMED WATER PROJECT Consistcnt with Council Policy? [X] Yes ] New Policy or Excel APPROVED BY CITY COLTXCIL - - rr b� 19-70 Statement of Issue, Recommendation, Analysis, Funding Source, Alternative-!, PIO 5/85 STATEMENT OF ISSUE The Green Acres Project of the Orange County Water District (OCWD) will provide reclaimed water for irrigation purposes to the City of Huntington Beach. An approved agreement between the agencies will allow OCWD to proceed with the Huntington Beach portion of the Green Acres Project (GAP). RECOMMENDATION Approve the agreement which allows Iuntington Beach to participate in the reclaimed water project. f \. tiA ATI-A &� Orange County Water District is willing to supply reclaimed water to as many local users as possible. Huntington Beach is a' logical participant in the project due to our location and ability to utilize the reclaimed water supply. The Water Division has been working closely with OCWD for the past year to analyze our reclaimed water demands and plan transmission line locations.L The project will consist of a reclaimed water transmission system which extends through the City from east to west. Preliminary design has determined a large transmission line will extend from the OCWD supply facility at Ellis Avenue and Ward Street, down Garfield Avenue to Golden West Street and Warner Avenue. This system will provide reclaimed water to several high consumption irrigation areas, such'as Seacliff Golf Course, the Holly Seacliff area, Central Park, the County Linear Park and the Bolsa Chica Development. Additionally, it is planned to serve the County Sanitation District's Plant No. 2 at Brookhurst and Bushard Streets. Reclaimed water is a significant source of additional water supply. Facilities in Los Angeles and Orange Counties have been providing reclaimed water for irrigation purposes to communities for several years. Current users include Long Beach, Irvine, 1 San Clemente, Moulton Niguel, Dana Point, Laguna Beach and Palm � J Desert. Caltrans is required by the State to utilize reclaimed water for roadside irrigation if it is available. �� W" Request for Green Acres Page 2 Council Action Project The California Water Resource Control Board has requested that Southern California should use reclaimed water as an alternative to increased allocations from the State Water Project. Reclaimed water is highly treated and odorless, almost meeting the safe drinking water standards. There are no adverse affects from using reclaimed water as the water lines are completely separate from domestic water facilities. Huntington Beach will be Phase II of the Green Acres project. Construction could begin as soon as 1992. Upon completion, the project will provide up to 15 million gallons per day of irrigation water. Fountain Valley, Santa Ana and Mesa Consolidated Water District (Costa Mesa) are participants in Phase I, which is currently under construction. The Green Acres Project will lessen the demand on our domestic water supply significantly. With OC1qD's willingness to design and construct the transmission lines at their expense, the City will avoid a three to four million dollar expenditure. Reclaimed water is the most expeditious method to supplement the City's present and future water needs. FUNDING SOURCE Not Applicable ALTERNATIVE ACTIONS Do not approve the agreement, and decline participation in the Green Acres reclaimed water project. Do not approve the agreement, and direct staff on how to proceed. Do not approve the agreement, and direct staff to design and construct our own reclamation facilities at a cost of several million dollars.. Do not approve the agreement, and direct staff on how to secure sufficient water supplies for both irrigation and domestic purposes. ATTACHMENTS Agreement between Orange County Water District and the City of Huntington Beach to Provide Green Acres Project Water. LES:JRR:1d ftr.VtI V E 0 1v... . X-loop At 4. '" I a..A..aw►aw►ae• 111M retie►.• ,.rta ■. y..a• 0044 . e. ►ere. ..YL IY N..0 OLAW a.Y.e 4.Ka f...a N f..M 1 a.al.. NY aat■e. M.Ir•a . VOMa►..rf ,.t.newc a aw=� ia• r.r.ec � ccre�*. ■...,w.cw .�w..r.• ..w.aa. % ae.. ■.C..� w ►.N jeat a. ■r.aawa.e ..w....i R ra.�r. r. f.ava. ..C."a Y.a., C. aYar T1.Or.e eYCa.NTOy Y.tr s..e4a' r.4.Iwy a a.a f,M..A J4• A lAw1►I.I .ear ■.LL.■ 0 M .t.wa..e r. ewta. Loft"e...a C. ►..n• w..tr W 0—.Ca a4...aN a. r..Aea* trww.a i Cw 4. a.Cw.a. e. ere•. /O.y L .aµe.a w1 I.A e. w.r.w. r.w a.*".aft OR.I-CT Ia. 6011 r• ..M. % aweewe paaH. a- l.&Al V t. ' `ll_�UTAN & TUCKER ArrowNcri AT LAW A .A■tr[wf.IP I.CLVO.rS ae0r [;;.O.AL COw.D.ATIO.f CCIITRAL OAMC TO+CM. SUIT[ 1400 SOUT.I COAST PLAZA TO.III CCMTCR 011 ANTOI. •OVLCVAeO POST OFFICE Pox Ifgo COSTA MitiA. CAU/OR•ILA OZGZS-9900 T[LLPrOIIR 47141 HI -LIDO jXQJ 1"5•736t TCL[GOPI[w s7141 S+0-003t A. a erTAr....-.eral .I..af F M..A.N ..I.Ie•► t w.e+sA November 12, 1990 Steven Conklin Orange County Water District P.O. Box 8300 Fountain Valley, California 92728-8300 NOV1;J ZW a...ar.�Y1� Rw..wOM.n was � w ■ � • �.tr a e++r .. ww.rt ■...1 �a.a0. .. all— ►.at.a .C.I. R Maie.l MT.a ., ai.Aao e..C■ i [Na ..►a.a. A. ar..l.TT ■.C..Y .. a.r.l..►ae L f.. r.a�.ey r.M aylTr I►... f,.C.., Kra.{wl •.aaf 4 Ilea.,. M.N .. wuraA a*.f»+ a auTR. «� e.a.a. a f•+cra■ ■.Twl revue.,. la..r... e.y f...Y 4tl ., fT..ua I.ra... •. r►.tr•f ■.r a. 1.erM►. I..le \ rl.fA ..rf w...e.ta r.raf a Y.eC .. .TT -to a.Ota ►.r.a 1, r..e a.t...aw w. a►L.O e.w.. f.Yre.r aA_ . e�a.W. C.■e4 4 ►a.w4a. ♦a.I.a..a.T.a..aa {a...Iaa V ..C..lt a. T... aft e,l r.r, w.aFFY. Yeam e, 40.9. ...a.ea a. w.tA..A AV.. . Te..ae., WCw..e a, ae.iu aar/■lr A. exe.Awe A...T..ea wya M..e i e.■.e.tiM, w. M ■a.r.q Re: Green Acres Project (Huntington Beach Retail Dear Steve: Per your request, I have reviewed the changes that you had proposed to the Green Acres Project Retailer Agreement executed recently by the City of Huntington Beach. I have incorporated all of the changes that you proposed into a new version of the Agreement, and have enclosed both a clean and red -line copy of this new version. Given the lack of any substantive changes to the Agreement, Z do not believe it necessary.to treat the changes as formal amendments and reprocess an amended agreement before both the OCWD Board and the Huntington Beach City Council. Rather, I believe that the changes can be treated as clerical corrections and updating, such that the approvals from each agency need not be disturbed, and the Agreement (in its revised form) may be executed by the appropriate officials from each agency. In order to accomplish this, however, this opinion must also be shared by the Huntington Beach City Attorney. Please note that while the text of the Huntington Beach Agreement has been changed, the exhibits (which are not on the system in this office) have not been modified. Accordingly, OCWD should make the requisite changes to the exhibits prior to attaching their to the Huntington Beach Retailer Agreement and transmitting the package to Huntington Beach for its review. RUTAN & TUCKER ATTOPImCYS AT L^W Steven Conklin November 12, 1990 Page 2 I hope that this assists you in finalizing the Huntington Beach Retailer agreement under the Green acres Project. As always, should you have any questions regarding this or any other legal matter affecting OCWD, please do not hesitate to call. Very truly yours, JDK:t Enclosures 8/131/006104-0001/170