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CITY OF
NEWPORT BEACH
City Council Staff Report
July 25, 2023
Agenda Item No. 4
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Mark Vukojevic, Utilities Director - 949-644-3011,
mvukojevic@newportbeachca.gov
PREPARED BY: Mark Vukojevic, Utilities Director — 949-644-3011,
mvukojevic@newportbeachca.gov
PHONE: 949-644-3011
TITLE: Reimbursement Agreement with the Orange County Water District
Related to Groundwater Treatment Facilities
ABSTRACT:
The Utilities Department operates the City of Newport Beach's (City's) four groundwater
wells located in the City of Fountain Valley and is a groundwater producer within the
Orange County Groundwater Basin. An emerging constituent of concern, Per- and
polyfluoroalkyl (PFAS) substance contamination, has been detected and is impacting
wells across the Orange County Groundwater Basin. In the event that treatment becomes
necessary for the City's wells, it is recommended that the City enter into a reimbursement
agreement with the Orange County Water District (OCWD). If needed, the agreement
allows OCWD to fund 100 percent of the design and construction costs, as well as
50 percent of the maintenance costs, of a treatment facility to remove PFAS.
RECOMMENDATIONS:
a) Determine this action is exempt from the California Environmental Quality Act (CEQA)
pursuant to Sections 15060(c)(2) and 15060(c)(3) of the CEQA Guidelines because
this action will not result in a physical change to the environment, directly or indirectly;
and
b) Approve a reimbursement agreement for Per- and polyfluoroalkyl substances (PFAS)
Treatment Facilities and Program Agreement (Reimbursement Agreement) among
other groundwater producers, and the Orange County Water District (OCWD) for
reimbursement funding for the City of Newport Beach to develop, construct, operate,
and maintain groundwater treatment facilities, and authorize the City Manager to
execute all documents to become a party to the Agreement.
DISCUSSION:
The Utilities Department proposes to enter into a Reimbursement Agreement with OCWD
that would provide substantial reimbursement funding for the capital and annual operation
and maintenance costs for groundwater treatment facilities. If needed, groundwater
treatment will provide the long-term benefits of accessing lower cost and reliable
groundwater for Newport Beach water customers in lieu of purchasing more expensive
imported water. The City has pumped the majority of its drinking water supplies from the
local Orange County Groundwater Basin (Basin) managed by OCWD over the last three
decades.
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Reimbursement Agreement with the Orange County Water District
Related to Groundwater Treatment Facilities
July 25, 2023
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As detection and testing technologies have improved over the years, new contaminants
of concern are being tracked and regulated. Many water agencies in the Orange County
groundwater basin have discovered levels of PFAS in their groundwater wells. Per- and
polyfluoroalkyl substances are a group of now prohibited manmade chemicals that were
used to make carpets, clothing, fabrics for furniture, food packaging, cookware, and other
materials to make them non-stick and/or resistant to water, oil and stains. They were also
used in a number of industrial processes. Chemical manufacturers are the original source
of PFAS chemicals.
PFAS is a national water quality matter being addressed by the U.S. Environmental
Protection Agency and the State of California Division of Drinking Water. Regulations
have changed over the last few years and new regulations are being proposed, especially
as the science and testing capabilities evolve. Regionally, hundreds of groundwater wells
in Southern California, including in Los Angeles, Orange, Riverside and San Bernardino
Counties have been found to contain varying amounts of PFAS and have been required
to shut down or for treatment systems to be installed.
As noted on the City's website, the City recently discovered low levels of PFAS at its two
shallow groundwater wells, just above detection limits. City staff now conducts routine
testing for PFAS and closely monitors the situation. As of now, the PFAS levels are low
and below any actionable limits or goals. As an added precaution, staff has tested water
at City reservoirs before distribution, and no levels of PFAS have been detected.
Newport Beach's water is in full compliance with all drinking water regulations, meeting
all state and federal drinking water standards set to protect public health.
Given the magnitude of the PFAS impacts to the Basin and OCWD's role as the agency
responsible for the protection of local groundwater supplies, the Reimbursement
Agreement was developed to allow for a Basin -wide effort in the purification and treatment
of groundwater. At this time, no action is needed by the City regarding PFAS treatment;
however, proactively and in response to detections of the compound, it is prudent to enter
into an agreement. The agreement provides the framework for OCWD to work with
impacted groundwater producers to fund 100 percent of the design and construction
costs, as well as 50 percent of the ongoing operations and maintenance costs of the
facilities during a 30-year term. At the onset, City staff expects to work with OCWD to
evaluate initial planning and design options. If a treatment plant is needed, and a project
comes to fruition, it will be presented for consideration as a Capital Improvement Project.
These efforts will ensure Newport Beach's water customers continue to receive high
quality, reliable water that meets all state and federal water quality standards.
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There is no fiscal impact related to the approval of this agreement. Any design
expenditures will be reimbursed by OCWD. A typical PFAS treatment project has a cost
range of $3 million to $5 million. If a project becomes necessary, it will be presented along
with its associated financials, as a Capital Improvement Project.
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Reimbursement Agreement with the Orange County Water District
Related to Groundwater Treatment Facilities
July 25, 2023
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ENVIRONMENTAL REVIEW:
Staff recommends the City Council find this action is not subject to the California
Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) (the activity will not
result in a direct or reasonably foreseeable indirect physical change in the environment)
and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA
Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no
potential for resulting in physical change to the environment, directly or indirectly.
NOTICING:
The agenda item has been noticed according to the Brown Act (72 hours in advance of
the meeting at which the City Council considers the item).
ATTACHMENT:
Attachment A — Reimbursement Agreement with Orange County Water District
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ATTACHMENT A
PFAS TREATMENT FACILITIES AND PROGRAM AGREEMENT
This PFAS TREATMENT FACILITIES AND PROGRAM AGREEMENT (the
"Agreement") is effective on the date identified in Section 10.17 ("Effective Date") of the
Agreement, and is between the ORANGE COUNTY WATER DISTRICT, a special governmental
district organized and existing pursuant to the Orange County Water District Act, Chapter 924,
Statutes of 1933, as amended ("OCWD") on the one hand, and the Cities of Anaheim, Fullerton,
Garden Grove, Orange, Santa Ana and Tustin; and the East Orange County Water District, Irvine
Ranch Water District, Serrano Water District, and Yorba Linda Water District, (each a
"Producer," and collectively "Producers"') on the other. OCWD and the Producers are each a
"Party" and collectively "Parties" to this Agreement.
A. OCWD manages the Orange County Groundwater Basin ("Basin") in northern and
central Orange County in order to support a variety of beneficial uses, including potable and non -
potable water supply. Much of the potable water supply currently used within northern and central
Orange County is pumped groundwater for use by persons and Producers within OCWD's service
area. Section 2, subdivision 60.) of the Orange County Water District Act ("OCWD Act")
authorizes OCWD to "transport, reclaim, purify, treat, inject, extract, or otherwise manage and
control water for the beneficial use of persons or property within the district and to improve and
protect the quality of the groundwater supplies within the district." Inasmuch as Orange County
is located in a semi -arid area, it is essential that all reasonable efforts be put forth by OCWD, in
cooperation with the Producers, to protect the quality and quantity of groundwater supplies within
OCWD's boundaries.
B. A group of man-made substances known as per- and polyfluoroalkyl substances
("PFAS") has been used in numerous consumer and industrial products since the 1940s. Recent
testing in the Basin has revealed that as of the Effective Date, at least eleven producers and at least
71 groundwater wells that are sources of drinking water in the Basin are impacted by PFAS.
C. Producers are governmental agencies (or a regulated public utility) that operate
public water systems for the purpose of delivering potable water. They obtain a portion of their
water supply by pumping groundwater from Water Producing Facilities within the Basin.
D. In July 2018, the State of California Division of Drinking Water ("DDW")
established a Response Level ("RL") of 70 parts per trillion ("ppt") for perfluorooctanoic acid
("PFOA") and 70 ppt perfluorooctane sulfonate ("PFOS"), two types of PFAS. In February 2020,
DDW established revised RLs of 10 parts ppt for PFOA and 40 ppt for PFOS. Assembly Bill 756,
codified at Health and Safety Code Section 116378, and effective January 1, 2020, requires that
community water systems, including Producers, either notify their customers of PFAS detections
' "Producers" means the listed public agencies (and a regulated public utility) identified herein,
and groundwater pumpers later added per Section 10.16, that extract groundwater from the Basin
via "Water Producing Facilities" (as that term is defined in Section 24 of the OCWD Act), and
who are adversely impacted by PFAS in one or more Water Producing Facility/Facilities they own
or operate.
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exceeding RLs or remove from service drinking water sources with PFAS exceeding RLs.2 The
revised RLs are perceived as a de facto regulation by some Producers.
E. In November 2019, the State of California Office of Environmental Health Hazard
Assessment began the process of developing drinking water Public Health Goals ("PHGs") for
PFOA and PFOS, the first step in the regulatory process leading to DDW setting enforceable
Maximum Contaminant Levels ("MCLs"). As of the Effective Date, DDW projected establishing
MCLs for PFOA and PFOS by the Fall of 2023, with PHGs projected to be established by the
Summer of 2021.
F. PFAS compounds create a unique groundwater contamination issue that impacts
many Producers. Without any action, PFAS impacted groundwater may migrate affecting other
Water Producing Facilities and larger portions of the Basin.
G. The Parties desire that the Basin continue to provide a groundwater supply of
suitable quality to allow for the continuation of all existing and potential beneficial uses, and that
is in compliance with all state and federal standards and relevant advisory levels. Quick and
effective actions by OCWD, in concert with Producers, are needed to remove, treat and control
PFAS down to established regulatory limits while also removing them to prevent their
contamination of other portions of the Basin.
H. The Parties recognize the necessity and commit to a high level of coordination to
expeditiously design, construct and operate PFAS treatment systems ("Treatment Systems") to
remove PFAS from the Basin where PFAS is detected in Water Producing Facilities.
I. Until Treatment Systems are constructed, the impacted Producers will be
purchasing greater amounts of more expensive imported water, and water in the Basin containing
PFAS will not be treated so as to prevent its spread to other portions of the Basin.
J. As a result of DDW issuing revised RLs for PFOA and PFOS, and anticipated
issuance of RLs and state or federal MCLs for other PFAS, Producers have lost, or are anticipated
to lose upon finalization of the RLs and/or MCLs for one or more PFAS, pumping capacity in one
or more Water Producing Facilities due to the presence of PFAS. Given the magnitude of the
PFAS problem within the Basin, and OCWD's desire to improve and protect the quality of the
groundwater supplies within the District so that groundwater from the Basin may be beneficially
used, OCWD has developed, and is implementing through this Agreement and other actions, a
new program that will allow OCWD to purify and treat groundwater containing PFAS by
substantially funding, contracting and cooperating with Producers to develop, construct, operate,
and maintain Treatment Systems such that water quality within the OCWD will be purified and
improved ("Program"), and such that Producers can continue to beneficially use groundwater
from the Basin after treatment for drinking water purposes. Producers desire to participate in the
Program.
2 DDW's February 2020 guidance directs community water systems to test for PFAS using EPA
Method 537.1 and notes that DDW defines PFAS "as those analytes included in EPA Method
537.1."
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K. OCWD has the authority to "construct, purchase, lease, or otherwise acquire, and
to operate and maintain necessary waterworks and other works, machinery, [and] facilities ...
useful or necessary to ... protect the quality of the common water supplies of [OCWD] and
purposes incidental thereto."3 OCWD may also perform groundwater cleanup, abatement, or
remedial work in cooperation with any other governmental agency, and may initiate cost recovery
actions against persons responsible for causing contamination of the Basin, and for its costs in
cleaning up or containing contamination or pollution of the Basin.4 OCWD is also authorized
under Section 2(6)(1.) of the OCWD Act to protect and improve water quality within the Basin by
entering into contracts with Producers to produce more groundwater from the Basin, while taking
less water from alternative non -tributary sources, where OCWD determines that such increased
production of groundwater will result in removal of contaminants or pollutants from the Basin that
otherwise would not be removed. Specifically, OCWD has authority, "for the common benefit of
the district and for the purpose of managing the groundwater basin and managing, replenishing,
regulating, and protecting the groundwater supplies within the district" to enter into an agreement
with Producers to increase the production of groundwater in lieu of water from an alternative non -
tributary source for the purpose of removing contaminants or pollutants from the Basin. OCWD
may also "pay from district funds that portion of the cost of the groundwater production as will
encourage the production for beneficial use of polluted or contaminated groundwater, as long as
that pollution or contamination is impairing the quality of the water supplies within the district and
the quality of the water supplies within the district will be improved by that production."
L. OCWD has determined that certain portions of the Basin in the vicinity of
Producers' Water Producing Facilities are polluted by PFAS, and that entering into this Agreement
with Producers will encourage beneficial use of groundwater polluted by PFAS that would
otherwise not be used while improving the quality of water supplies within the District.
M. OCWD and the Producers mutually desire to enter into this Agreement pursuant to
the OCWD Act to document the Program responsibilities of the Parties in the construction and
operation of PFAS Treatment Systems, systems that the Parties will use to treat PFAS pollution
and contamination, thereby improving the quality of groundwater supplies within OCWD.
The Parties therefore agree as follows:
1. The Recitals above are deemed true and correct and are hereby incorporated in this
Agreement as though fully set forth herein. The Parties agree that the actions that will be taken
pursuant to this Agreement are reasonable and necessary to accomplish the goals and objectives
of the OCWD Act.
2. PURPOSE.
2.1 Facilitation of Basin -wide Treatment. OCWD and the Producers intend to
facilitate treatment of Basin groundwater impacted by PFAS. OCWD will coordinate and fund
planning and treatment pilot studies and design efforts, and fund the construction costs of PFAS
3 OCWD Act, Section 2, Subd. 5.
4 OCWD Act, Section 8.
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Treatment Systems in the Basin subject to the provisions of this Agreement. OCWD will also
fund a portion of the operation and maintenance costs of those facilities.
2.2 PFAS Compounds and Reopener. The Parties recognize the necessity of
and commit to a high level of coordination to expeditiously design, construct and operate PFAS
Treatment Systems to remove PFAS from the Basin where PFAS is detected in a Producer's
(existing or anticipated) Water Producing Facilities at or above 80% of an applicable RL or MCL.
The Parties acknowledge that additional compounds within the PFAS family may become
regulated during the term of this Agreement. To the extent the Treatment Systems developed
under this Agreement requires modification to treat PFAS that becomes regulated after the
Effective Date, the Parties will, where necessary and mutually agreed upon, amend this Agreement
to provide for treatment of additional compounds in the PFAS family.
3. PLANNING.
3.1 Planning Stu . OCWD has retained a consultant to prepare a "Planning
Study" to evaluate the Producers' water systems, any of their Water Producing Facilities impacted
by PFAS ("Impacted Wells"), and potential locations for construction of PFAS Treatment
Systems for Impacted Wells. OCWD shall cause the consultant to actively consult with Producers
in connection with preparation of the Planning Study. OCWD shall cause the consultant to provide
a final Planning Study report to OCWD and Producers concurrently.
3.2 Pilot Study. OCWD shall perform a PFAS treatment "Pilot Study" to
evaluate different treatment technologies to remove PFAS from groundwater.
3.3 Treatment Systems. OCWD shall use the results of the Planning Study and
the Pilot Study to reasonably determine the type and final design of the Treatment Systems to treat
PFAS contamination in the groundwater produced by Impacted Wells to levels below the RL or
MCL. Development of the final design of Treatment Systems will consider 30-year lifecycle costs,
including but not limited to Treatment System footprint and physical setting, relative land values,
the proximity to existing water infrastructure and energy sources, operational costs and limitations,
and any PFAS treatment studies conducted by Producers. The Treatment Systems will be designed
for a 30-year useful life. If OCWD and a Producer mutually agree, a Treatment System that can
remove PFAS contamination down to non -detect concentrations, depending upon site specific
circumstances, may be designed and constructed.
3.4 Enhancements/Additions to Treatment S, sue. If Producer desires to
construct additions or enhancements to the PFAS Treatment System beyond what OCWD
determines is the appropriate Treatment System, then OCWD will reasonably estimate the cost of
those additions or enhancements (including planning costs, design costs, capital costs and
operation and maintenance ["O&M"] costs) with assistance and input from Producer(s). For
OCWD-Built facilities (defined below), OCWD shall include the additions or enhancements in the
design and construction of the treatment facilities upon OCWD determination of feasibility of
efficiently operating the Treatment Systems with the requested additions or enhancements.
Producer shall reimburse OCWD for all costs associated with the OCWD-Built addition or
enhancement constructed by OCWD. For Producer Built Treatment Systems that contain additions
or enhancements beyond what OCWD determines to be an appropriate Treatment System,
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Producers shall have no right of reimbursement from OCWD for Producers' costs attributable to
such additions or enhancements.
3.5 Producer Assistance. Producers shall support and assist OCWD in
connection with the Planning Study, Pilot Study, and development of what constitutes an
appropriate Treatment System design. "Support and assist," as used in this Agreement means
timely providing reasonable staff time and available data/technical information where requested
by OCWD to ensure OCWD has sufficient information to timely complete its obligations under
this Agreement.
3.6 Untested Water Producing Facilities. OCWD reserves the discretion to
delay the design and to not construct Treatment Facilities at Water Producing Facilities that have
not been individually tested for PFAS, or which have not demonstrated consistent exceedance of
an applicable PFAS RL or MCL.
4. DESIGN AND CONSTRUCTION OF PFAS TREATMENT FACILITIES.
4.1 Funding. OCWD shall fund the reasonable cost to design and construct the
Treatment System, except for necessary real property and entitlements for siting the Treatment
System as described in Section 4.4. OCWD's funding obligations apply both to OCWD-Built or
Producer -Built Treatment Systems, as defined below. OCWD's funding obligations include
planning, design, and construction of the Treatment Systems whether OCWD-Built or Producer -
Built.
4.2 OCWD Construction or Reimbursement. The Producer shall elect either:
A. to have the Treatment System designed and built by OCWD
("OCWD-Built"); or
B. to be reimbursed for having the Treatment System designed and
built by the Producer ("Producer -Built").
4.3 CEQA. In connection with the proposed Treatment System for Impacted
Wells, the Parties shall work together to determine the best plan for and the lead agency for the
purpose of complying with the California Environmental Quality Act ("CEQA"). Where a
Producer serves as lead agency for a CEQA project, OCWD shall serve as a Responsible Agency
and approve the portions of the CEQA project that OCWD will carry out. OCWD shall fund
CEQA expenses incurred in connection with the Treatment System whether it is a Lead Agency
or a Responsible Agency. Upon a Producer's request, OCWD shall prepare necessary CEQA
documents for the Treatment System. OCWD shall fund any reasonable CEQA mitigation cost
excluding land acquisition expenses.
4.4 Property Acquisition, Entitlements.
A. Land and Rights of Way. Each Producer shall secure at its expense
any land and/or right of way necessary to construct the Treatment System(s).
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B. Entitlements. Each Producer shall obtain at its expense all land use
entitlements necessary to construct the Treatment System(s).
C. Property Conditions for OCWD-Built Treatment System. If a
Producer chooses an OCWD-Built Treatment System, then OCWD will have no obligation to
design or construct the Treatment System until a Producer has demonstrated it has obtained lands
and land use entitlements sufficient to permit construction of the Treatment System. OCWD may
begin final design work for facilities where land use entitlements are in the process of being
obtained. If a Producer is unable to obtain the necessary entitlements within twelve months after
the completion of the preliminary design for an Impacted Well, then Producer shall reimburse
OCWD for reasonable design costs associated with that location unless the twelve month deadline
is extended by mutual agreement of the Parties.
4.5 OCWD-Built Facilities. The provisions of this Section 4.5 apply to PFAS
treatment facilities that a Producer elects to have OCWD design and build.
A. Design. OCWD will consult with and seek input from the Producer
on the design and construction of the Treatment System, including the need for any extended
manufacturer's warranties on Treatment System components. Producer shall support and assist
OCWD in hiring design consultants and designing the Treatment System, but OCWD will have
the reasonable authority and discretion in determining the Treatment System final design. The
level of treatment selected by OCWD must allow the Producer to treat regulated PFAS to comply
with RLs or MCLs, unless special circumstances dictate an alternative approach. Additions or
enhancements to the Treatment System are subject to section 3.4.
B. Property Rights. A Producer shall provide OCWD with temporary
property rights over any site necessary for construction, staging, and laydown for the Treatment
System project. These temporary property rights will be in the form of a license or temporary
construction easement, or other property right sufficient to provide for OCWD's control of the site
during construction.
C. Advertising and Award of Construction Contracts. OCWD shall
advertise, where required by the OCWD Act, and award construction contracts for construction of
the Treatment System. A Producer shall support and assist OCWD in these efforts, and shall
expeditiously provide any documents necessary for construction at no charge to OCWD.
D. Administration and Inspection. OCWD will administer the
necessary contracts to construct the Treatment System, including reviewing and responding to
contractor requests for information or requests for clarification, reviewing and approving shop
drawings, and filing a Notice of Completion. OCWD shall provide all construction and inspection
for the Treatment System.
E. Transfer of Treatment System. Upon filing the Notice of
Completion for the Treatment System, OCWD will transfer the constructed and operating
Treatment System to the Producer with an appropriate legal instrument and a quitclaim of any
property rights obtained under Section 4.4. OCWD shall provide the Producer with copies of all
applicable O&M manuals and record drawings for the Treatment System in OCWD's possession.
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Upon the Producer's receipt of the legal instrument and quitclaim of property rights, Producer shall
be solely responsible for ensuring the proper operation, maintenance and repair of the Treatment
System. The Parties may arrange for extended warranties on any component of the Treatment
System, which additional cost may be paid for by the Producer, and which extended warranty will
be transferred to the Producer together with the transfer documents.
F. Warranty, Post -Construction Remedies. OCWD will make
construction warranty repairs and modifications not attributable to the negligence or willful
misconduct of Producer for one year after the date of filing of the Treatment System Notice of
Completion. The Parties will also, to the extent they deem prudent, jointly pursue any statutory
construction defect remedies against third -parry designers and contractors.
G. DDW Permit Assistance. OCWD will support and assist the
Producer with technical information in modifying the Producer's DDW operating permit to
account for and authorize the new Treatment System as part of the Producer's public water system.
4.6 Construction by Producer. The provisions of this Section 4.6 apply to PFAS
treatment facilities that a Producer elects to design and build.
A. OCWD Approval of Design. The Producer shall prepare and submit
to OCWD for approval a conceptual design for the Treatment System. OCWD shall review and
approve the design in writing within 30 days, which approval will not be unreasonably withheld.
Once conceptual design for a Producer's proposed Treatment System is approved by OCWD, the
Producer will coordinate with OCWD in the planning and final design of the Treatment System.
The Producer shall then prepare and submit the final design to OCWD for approval. OCWD shall
participate in the Producer's project meetings as necessary to obtain OCWD's final approval of
the Treatment System in an expeditious manner so as not to delay the Producer's design and
construction of the Treatment System. OCWD shall review and approve the final design, if
deemed reasonable and effective, in writing, within 30 days. Such approval will not be
unreasonably delayed or withheld, though OCWD shall have the right to place reasonable
conditions on the final design approval.
B. Construction. Upon OCWD's approval of the final design, the
Producer shall advertise, award, and ensure timely completion of all necessary contracts to
construct the Treatment System. The Producer shall notify OCWD upon the award of the
construction contract and upon recording the Notice of Completion.
5. OPERATIONS, MAINTENANCE AND REPLACEMENT.
5.1 30-Year Term. Each Producer shall operate, maintain, and repair a
Treatment System, and any related Impacted Well, for the earlier of:
for PFAS.
A. 30 years following the filing of the Notice of Completion; or
B. Until water produced from the Impacted Wells meets RLs or MCLs
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5.2 Operating Standards. OCWD recognizes in the normal course of operating
a water system, the Treatment System and Impacted Wells may need to be turned off for routine
maintenance, seasonal demands, emergencies, accommodating in -lieu imported water deliveries,
and major repairs. Each Producer agrees to operate the Treatment System in a manner consistent
with industry standards and take actions in the same manner as a reasonably prudent water system
operator, with the understanding that the Treatment System funded by OCWD is intended to be
regularly used for daily treatment of groundwater as long as PFAS exceeds an RL or MCL in the
Basin in the vicinity of the well. The Parties understand and agree that Treatment Systems
constructed or funded by OCWD are not intended to be used as "stand by" treatment systems.
5.3 Compliance, Permits, Testing, Reporting. Each Producer shall obtain and
comply with any and all regulatory permits, permissions or approvals necessary to operate and
maintain the Treatment System. Producer shall operate and maintain the Treatment System in
accordance with state and federal regulatory requirements, prevailing industry standards, good
housekeeping practices, and equipment manufacturer recommendations and requirements.
Producer shall perform required water quality testing and reporting to verify the successful
operation of the Treatment System to comply with regulatory requirements. If a Producer fails to
timely perform testing and/or reporting in the future, then OCWD may in its reasonable discretion
assume responsibility from a Producer for required water quality testing and/or reporting and that
Producer shall timely pay OCWD all reasonable and necessary costs for that testing and reporting
or such costs shall be deducted from OCWD's reimbursement payments to the Producer per
Section 5.4.
5.4 Post -Completion Inspection; Cost Recoupment.
A. OCWD will periodically inspect the Treatment System after the
filing of the Notice of Completion, to review the adequacy of Producer O&M activities. Producer
shall provide access to the Treatment System after receiving reasonable notice from OCWD.
B. To the extent OCWD finds that Producer is not adequately operating
and maintaining the Treatment System in accordance with industry standards and the
manufacturer's directions, OCWD will, in the following order:
(1) meet with the Producer in attempt to resolve the inadequate
operation or maintenance;
(2) formally notify the Producer of its obligation to properly
maintain and operate the treatment system and give the
Producer up to 120 days to remedy any OCWD finding of
inadequate maintenance and/or improper operational
protocols;
(3) after 120 days, suspend O&M payments described in
Section 6.2 until such time as the Producer demonstrates to
OCWD that it is properly operating and maintaining the
treatment system;
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(4) no sooner than 270 days from the initial formal notice,
terminate this Agreement and seek to recoup, where
applicable, the cost of constructing the Treatment System
and/or other applicable damages.5
6. FINANCIAL.
6.1 Capital CostsPayment and Reimbursement.
A. OCWD-Built Facilities —Upfront Payment. For OCWD-Built
Treatment System, OCWD will pay as up -front costs all planning, design, construction, and start-
up costs as described above, except for the costs for property rights, land use entitlements,
additions or enhancements, or as otherwise described in this Agreement.
B. Producer -Built Facilities —Reimbursement. OCWD shall
reimburse the Producer for all of the Producer's reasonable expenses for the planning, design,
construction, and start-up of Treatment System on a monthly basis. OCWD shall pay
reimbursements to the Producer within 30 days of receiving adequate documentation from the
Producer.
C. Prior Expenditures. Within 60 days after the Effective Date, OCWD
will reimburse the Producer for any previous reasonable and authorized expenses incurred by the
Producer prior to the Effective Date in evaluating or developing the design for or constructing the
Treatment System for the Producer's Impacted Wells.
(1) Authorized expenses include, but may not be limited to:
(1) design type costs, consultants and contractor; (2) pre -purchase of equipment and media for
Treatment System; (3) equipment installed to temporarily treat for PFAS compounds which can
be repurposed by the Producer into the Producer's final Treatment System; (4) permitting cost;
and (5) CEQA type expenses. These same expenses incurred by Producer going forward are also
eligible for reimbursement. Design, engineering, or evaluative type expenses incurred by a
Producer that may be eligible for reimbursement, as reasonably determined by OCWD in its sole
discretion (with input from the Producer) could include: (1) outside consultant costs and studies
incurred by the Producer and related to the development and design of the Treatment System;
(2) equipment installed to temporarily treat for PFAS compounds which can be repurposed by
OCWD into a final treatment system; (3) permitting cost; and (4) CEQA type expenses.
Any action by OCWD to recoup its, or the Producer's, OCWD funded costs for construction
of the PFAS treatment system would be prorated based upon the length of time the treatment
facilities has been in operation, and by any percentage of third -party cost recovery OCWD has
obtained. For example, a breach by Producer in year twenty-five (25) of the thirty (30) year term
of this Agreement would result in OCWD recouping significantly less than if the breach occurred
in year five since twenty five years of useful life of the facility would have occurred, and would
be further offset by any third -party cost recovery obtained by OCWD during that time.
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(2) Unauthorized expenses for reimbursement shall include:
(1) the Producer's staff time; (2) direct or indirect overhead type expenses for staff, and (3) costs
not primarily attributable to Treatment System design, construction and O&M.
6.2 O&M Reimbursement.
A. Reimbursement Rate. OCWD shall reimburse each Producer for
50% of allowable O&M costs, up to $75/acre-foot of water treated by the Treatment System.
B. O&M Unit Cost. Each Producer shall annually calculate the O&M
unit cost of the Treatment System on a July 1st to June 30th fiscal year basis and submit this
information by October 1 st of the following fiscal year to OCWD for review and reimbursement.
The unit cost shall be calculated by dividing all appropriate and allowable O&M expenses by the
Treatment System total water treated. The annual submittal by the Producer shall include all
documentation and backup information necessary to support the unit cost calculation. Each
Producer shall provide any reasonable information requested by OCWD in verifying the
Producer's unit cost or other expenses for which the Producer seeks reimbursement per this
Agreement. After execution of the agreement, at the request of the Producer after the Treatment
System(s) are fully operational, OCWD will make a six month progress payment by January 30th
of each fiscal year based upon no more than 50% of the estimated eligible total O&M cost OCWD
would normally reimburse at the end of the fiscal year as determined by OCWD with input from
the Producer.
C. Reimbursable/Allowable Costs. Allowable O&M costs are the costs
to the Producer necessarily incurred for the regular operation and maintenance of the Treatment
System, as reasonably determined by OCWD after good faith consultation with Producer.
Allowable O&M cost shall consider the specific site issues of each Treatment System. Examples
of allowable O&M costs may include, but are not limited to:
(1) periodically replacing carbon, resin, or other adsorption
media;
(2) necessary power and chemical cost to operate the Treatment
System;
(3) routine maintenance of the Treatment System;
(4) periodic repair and replacement type cost items;
(5) cost of additional staff time to operate the Treatment System;
(6) required water quality sampling and testing for compliance
monitoring;
(7) determining and implementing compliance with new or
revised PFAS regulations;
(8) additional pumping cost caused by the Treatment System;
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(9) disposal of waste materials generated by the Treatment
System, including landfill costs and incineration, and costs
of hazardous waste disposal (if applicable);
(10) sewerage costs associated with maintenance/backwash of
the Treatment System; and
(11) such other reasonable maintenance costs as are necessary to
ensure the Treatment System continues to operate properly
consistent with its design.
D. Non -reimbursable costs include:
(1) existing Producer staff time costs not attributable to the
PFAS Treatment Facilities;
(2) direct or indirect overhead type expenses for staff; and
(3) cost resulting from a Producer's inadequate operation and
maintenance of the Treatment System.
E. Reimbursement Rate Adjustment. The $75/acre foot rate will be
automatically adjusted annually each July 1 (beginning July 1, 2021) by the percentage differential
based on the last two annual indices set forth in the Bureau of Labor Statistics Consumer Price
Index for All Urban Consumers - Los Angeles -Long Beach -Anaheim. The maximum O&M
reimbursement rate may be increased by OCWD if there are unforeseen, unique or specific
circumstances of the Treatment System that, through no fault of a Producer, result in a higher cost
of treatment at a Producer's treatment system, including increased costs attributable to new
statutes, regulations or regulatory interpretations.
F. Submittals; Reimbursement Timing. OCWD shall reimburse each
Producer its allowable O&M costs incurred by a Producer within 60 days of receiving the
Producer's annual O&M unit cost calculation and supporting information as described in
Section 6.2.13. via direct payment.
G. Treatment Media. OCWD may solicit and enter into a future
contract with the appropriate activated carbon, resin, and/or other adsorption media manufacturers
to obtain a lower price for this material than could be obtained by the individual Producer. Unless
a Producer opts out in writing of this Section within 30 days of the Effective Date, Producer will
support and participate in OCWD efforts to obtain a lower cost for activated carbon and/or resin.
6.3 Grants.
A. OCWD-Sought. OCWD may seek federal, state, or other grant
funding to offset costs of the PFAS program contemplated by this Agreement. Each Producer
shall support and assist OCWD, as may be reasonably requested by OCWD, to obtain any grants
that may be used by OCWD to fund construction and/or future O&M of Treatment Systems. Grant
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funds received by OCWD will be used to fund OCWD's costs of planning, design and construction
of Treatment systems, unless otherwise required by the terms of that grant.
B. Producer Support to OCWD-Sought Grants. Each Producer shall
support and assist OCWD in preparing any annual reports or documents necessary for OCWD to
comply with grants received for the PFAS program. Subject to the requirements of this
Section 6.3, no provisions in this Agreement will prevent a Producer from applying for grants or
loans, from any source, for PFAS treatment projects in its service territory.
C. Producer -Sought Funding. A Producer may also seek third -party
funding for Treatment System -related expenses. Any outside development and design type grants
or funding initiated and received by a Producer will be utilized to offset OCWD's PFAS design or
construction costs for the Producer. If a Producer receives any grants or other third -parry funding
for operational expenses of the Treatment System, that Producer shall share those proceeds with
OCWD in proportion to the percentage of O&M funded by OCWD if allowed by the grant or other
third -party funding instrument.
6.4 Records Retention, Audit. The Parties shall keep and maintain all records,
accounts and reports relating to this Agreement for a period of at least ten years after the date of a
final judgment or final settlement resolving any and all litigation related to PFAS cost recovery
initiated per Section 7.4 of this Agreement. The Parties will have access to these records at any
time during normal business hours upon 10 calendar days' notice. At its cost, any Parry may audit
the books, records and accounts of the Party relating to its performance of this Agreement, and the
audited Party shall provide reasonable cooperation to the auditing Parry in this regard.
7. RISK ALLOCATION.
7.1 Insurance.
A. Construction Activities. In the hiring of consultants and contractors
to design and build the Treatment System, the hiring or contracting Parry will have the other Party
(OCWD, if Producer -Built, or the designingibuilding Producer, if OCWD-Built) included as an
additional indemnitee and additional insured on the same basis and with the same limits in all
contracts. The hiring Party will use the higher of the two Parties' standard limits for the purpose
of coverage requirements. For example, in connection with an OCWD-Built Treatment System,
OCWD shall have Producer named as an additional indemnitee and an additional insured in all
consulting and construction contracts related to the Producer's Treatment System(s). In
connection with a Producer -Built Treatment System, Producer shall have OCWD named as an
additional indemnitee and an additional insured in all consulting and construction contracts. The
hiring or contracting Party shall provide the other Party with proof of insurance, including
additional insured endorsements.
B. Parties' Coverage. Each Producer shall take out and maintain in
effect at all times during the term of this Agreement comprehensive general liability insurance in
an amount not less than $2 million per occurrence, for bodily injury, death and property damage
associated with the operation and maintenance of the Treatment Facilities and Impacted Wells,
naming OCWD as an additional insured under such policy. An endorsement evidencing this
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insurance coverage shall be furnished to OCWD prior to OCWD or Producer commencing
construction on a Treatment System. If the Producer is, or becomes, partially or fully self -insured
for its public liabilities, a letter executed by the Producer's Chief Executive stating the Producer's
self -insured status and acknowledging its responsibility to indemnify OCWD as required in this
Agreement, may be furnished in lieu of the insurance endorsement otherwise required herein. The
Producer shall provide written notice to OCWD of any change in the Producer's insured or self -
insured status within 30 days of the date of such change.
7.2 Indemnity.
A. By Producer:
(1) Each Producer shall defend, indemnify and hold OCWD,
harmless from and against any and all actions, suits, claims, demands, judgments, attorney's fees,
costs, damages to person or property, losses, penalties, obligations, expenses or liabilities
(collectively, "Claims") that may be asserted or claimed by any third party arising out of the
negligent or reckless performance or implementation of this Agreement by Producer except for
Claims arising out of or relating to the design or construction of a Treatment System where OCWD
designed or constructed the Treatment System.
(2) Producer shall indemnify, defend and hold OCWD harmless
from any liability, or regulatory enforcement attributable, in whole or in part, to Producer's failure
to properly operate and maintain the Treatment System and Impacted Wells.
M000 I4Z�IId 1
(1) OCWD shall defend, indemnify and hold each Producer
harmless from and against any and all Claims that may be asserted or claimed by any third party
arising out of the negligent or reckless performance or implementation of this Agreement by
OCWD, except for Claims arising out of or relating to the design or construction of a Treatment
System where the Producer designed or constructed the Treatment System.
7.3 Release and Hold Harmless.
A. Producers' Release of OCWD.
(1) Producers, and each of them, hereby release OCWD, its
officers, directors, employees, agents and representatives, from any and all liability, known or
unknown, arising out of, or otherwise attributable to the discovery and/or presence of PFAS in the
Santa Ana River, the Basin, Producers' Water Producing Facilities, and Producers' potable or non -
potable water system, before, during or after treatment. Such release shall include, but is not
limited to, claims or litigation initiated by third parties against a Producer or OCWD, and any other
legal, administrative, or regulatory actions associated with OCWD's performance of its obligations
under this Agreement (unless attributable to OCWD's sole active negligence or willful misconduct
during such performance).
B. OCWD's Release of Producers.
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(1) OCWD hereby releases each Producer, their officers,
directors, employees, agents and representatives, from any and all liability, known or unknown,
arising out of, or otherwise attributable to the discovery and/or presence of PFAS in the Santa Ana
River, the Basin, Producers' Water Producing Facilities, and each Producers' potable or non -
potable water system, before, during or after treatment. Such release shall include, but is not
limited to, claims or litigation initiated by third parties against a Producer or OCWD, and any other
legal, administrative, or regulatory actions associated with a Producer's performance of obligations
under this Agreement (unless attributable to a Producer's sole active negligence or willful
misconduct during such performance).
(2) This release by OCWD does not pertain in circumstances
where liability results, or is alleged to result, from the failure of a Producer to properly operate and
maintain the Treatment System constructed per this Agreement.
C. Producer's Release of other Producers.
(1) Each Producer hereby releases and shall hold the other
Producers harmless from liability associated with the presence of PFAS in the Basin.
(2) However, this release by each Producer does not pertain to
circumstances where liability results, or is alleged to result, from the failure of the other
Producer(s) to properly operate and maintain the Treatment System(s) constructed per this
Agreement.
D. No Admission of Liability. Nothing contained herein shall be
deemed an admission of liability by any Party to this Agreement.
7.4 Legal Cost Recovery Efforts.
A. OCWD anticipates commencing litigation against responsible
parties, including chemical manufacturers of PFAS, in order to recover costs from persons
responsible for placing PFAS into the stream of commerce and/or the environment where it could
make its way into the Basin ("Damages"). The Producers shall support, coordinate, assist and
comply with all reasonable OCWD requests regarding OCWD's cost recovery litigation related to
pursuit of Damages associated with PFAS.
B. OCWD will request each Producer that has sustained Damages to
determine if intends to jointly retain counsel ("Shared Litigation Counsel") with OCWD in
litigation to recover Damages. Producers who join as co -plaintiffs are "Participating Producers"
in OCWD's cost recovery efforts.
C. OCWD and Participating Producers will establish a Steering
Committee and Executive Committee to direct Shared Litigation Counsel and make litigation
decisions.
D. OCWD and Participating Producers will enter into an appropriate
joint prosecution/common interest agreement to hire Shared Litigation Counsel and establish
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confidentiality and privilege concerning communications and work product of the Steering
Committee and Executive Committee.
E. OCWD and Participating Producer agree that any Damages obtained
in the PFAS litigation will be pooled and distributed to OCWD and Participating Producers
proportionally to their respective claimed damages, such that each Participating Producer and
OCWD will recover the same percentage of their overall claimed damages in the manner shown
on Exhibit A.
F. Participating Producers can decide at any time to discontinue
participation in the litigation initiated by OCWD, but agree, if applicable, to pay to Shared
Litigation Counsel, in accordance with any retainer agreement negotiated with Shared Litigation
Counsel, for the withdrawing Producers share of Shared Litigation Counsel's reasonable attorneys'
fees and cost incurred prior to the date of withdrawal (if any). Further, per the terms of any retainer
agreement with Shared Litigation Counsel, the Participating Producers agree to maintain as
confidential, and where applicable, to return, any communications and work product obtained via
the litigation.
G. OCWD believes that it is in the best interest of OCWD and
Producers impacted by PFAS to jointly initiate litigation as co -plaintiffs with Shared Litigation
Counsel. However, if a Producer decides to pursue or initiate separate PFAS litigation ("Separate
Litigation"), Producer shall notify OCWD of such intent thirty (30) days prior to formally filing
the Separate Litigation. Producer in the Separate Litigation must comply with the following:
(1) The Producer shall give OCWD the opportunity to review and
comment on Separate Litigation documents (e.g., pleadings) prior to any Separate Litigation fling.
(2) No PFAS related cost incurred by OCWD, or likely to be
incurred by OCWD, and related to the Producers treatment system(s) (construction and/or O&M),
will be asserted in a Producer's Separate Litigation.
(3) In order to prevent duplicative claims for the same damages in
separate lawsuits, assertion of which without OCWD's consent shall constitute a violation of this
Agreement, OCWD must approve any PFAS related cost a Producer is seeking to recover prior to
its assertion in Separate Litigation. However, OCWD shall not unreasonably withhold such
approval, and shall consult in good faith with counsel for a Producer that wishes to initiate Separate
Litigation in order to seek ways to accommodate the interests of both Parties, prior to disapproving
any cost.
(4) A Producer shall closely coordinate its separate legal action with
OCWD, and, where requested in good faith by OCWD, support the positions taken by OCWD
related to PFAS in court and in political, community and business forums.
(5) A Producer shall not assert claims against OCWD in any
litigation related to PFAS, or otherwise knowingly take positions that could result in OCWD or
other Producers incurring liability related to PFAS as a result of the position asserted by the
Producer in the Separate Litigation.
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8. EXPIRATION AND TERMINATION. This Agreement expires 30 years from
the Effective Date. A Producer may terminate this Agreement upon providing 90 days written
notice to OCWD. However, if a Producer terminates this Agreement prior to the 30 year date of
expiration, the Producer shall reimburse OCWD for all of OCWD's unrecovered costs in
constructing the Treatment System using the methodology described in footnote 5, plus any other
reasonable expenses incurred by OCWD as a result of the early termination.
9. NOTICE. Any notice, instrument, payment or document required to be given or
delivered under this Agreement shall be given or delivered by personal delivery or by depositing
the same in a United States Mail depository, first class postage prepaid, and addressed as set forth
in Exhibit B. Notice under this Agreement may also be provided to such other address as any
Party may direct in writing to the other. Service of any instrument or document given by mail will
be deemed complete upon receipt if delivered personally, or forty eight (48) hours after deposit of
such instrument or document in a United States mail depository, first class postage prepaid, and
addressed as set forth above.
10. MISCELLANEOUS.
10.1 Further Assurances. The Parties shall execute and deliver any documents
and cooperate in performing any acts necessary to further the intent of this Agreement.
10.2 Time is of the Essence. Time is of the essence in performing all obligations
under this Agreement.
10.3 Counterparts. This Agreement may be executed in multiple counterparts,
each of which is an original. All signatures taken together will be considered as one and the same
agreement.
10.4 Force Majeure. Upon written notice by a Party, the respective duties and
obligations of the Parties will be suspended for the time period that performance by the Party is
prevented or substantially impeded by workforce strikes; riots; fire; flood; federal, state or county
regulatory action; pandemics, war; or terrorism.
10.5 Dispute Resolution. If a dispute arises between the Parties in connection
with this Agreement, the Parties shall engage in a mediation before a third -party neutral.
10.6 Successors and Assigns. All of the terms, conditions and provisions of this
Agreement inure to the benefit of and will be binding upon OCWD, the Producer, and their
respective successors and assigns.
10.7 No Implied Waivers. If any term, condition or provision of this Agreement
is breached by either Party and thereafter waived by the other Party, that waiver will be limited to
the specific breach so waived, and will not be deemed either to be a continual waiver or to waive
any other breach under this Agreement.
10.8 No Obligation to Third Parties. The approval, execution and performance
of this Agreement does not confer any rights upon any person or entity other than OCWD and the
Producers. There are no third -party beneficiaries to this Agreement. Each Producer's obligations
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under this Agreement are to OCWD only, unless otherwise specifically stated herein
(e.g., requirement to release or provide notice to other Producers).
10.9 Nature of Relationship. This Agreement does not create, and will not be
construed or deemed to create, any agency, partnership, joint venture, landlord -tenant or other
relationship between OCWD and any Producer except as specified in this Agreement.
10.10 Integration, Construction and Amendment. This Agreement represents the
entire understanding of OCWD and each Producer as to the design and construction of PFAS
treatment facilities for the Impacted Wells. No prior oral or written understanding will be of any
force or effect with respect to those matters covered by this Agreement. This Agreement will be
construed as if drafted by both OCWD and each Producer.
10.11 Modification, Variance and Most Favored Nation Provisions. Unless
specifically authorized herein, this Agreement may not be modified, altered or amended unless in
writing signed by authorized representatives of both OCWD and all Producers, except that OCWD
and any individual Producer may enter into a Producer -specific "Variance" that will be applicable
only with respect to OCWD and that specific Producer. Except for where site -specific
circumstances require unique considerations, OCWD shall interpret and administer this
Agreement in a similar manner with each Producer. At least 30 days prior to approving any
proposed Variance, OCWD will provide written notice of the proposed Variance to the other
Producers and provide each with an opportunity to opt in to the same terms of that Variance. Upon
approval of any Variance, OCWD shall provide a fully -executed version of the Variance to each
Producer that has opted in under the Variance.
10.12 Severability. Each provision of this Agreement is severable from the whole.
If any provision of this Agreement is found contrary to law, the remainder of this Agreement will
continue in full force.
10.13 Authorily.
A. Producer hereby agrees that funding provided by OCWD per this
Agreement is in furtherance of OCWD's purpose of treating/purifying water in the Basin to
facilitate beneficial use of locally produced groundwater water in order to increase production of
groundwater containing PFAS from the Basin —to levels typical prior to setting of RLs for PFAS,
and that Producer's production of water from the Basin is in lieu of Producer taking water from an
alternative non -tributary source, thereby furthering OCWD's efforts to remove or eliminate PFAS
contaminants from the Basin.
B. By entering into this Agreement, each Party represents that it, and
to the best of its understanding the other Parties to this Agreement, have proper legal authority to
enter into this Agreement and to fund the work described herein. Each person executing this
Agreement on behalf of a Party warrants that they are: (1) duly authorized to execute and deliver
this Agreement on behalf of that Party, (2) by executing this Agreement, that Party is formally
bound to the provisions of this Agreement, and (3) entering into this Agreement does not violate
any provision of any other Agreement to which that Party is bound. No individual signing this
Agreement shall have individual liability under this Agreement. As a condition of entering this
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Agreement, all Parties expressly waive any future challenge to the legal authority of the other
Parties to enter into this Agreement, or to the authority of any other Party to fund the programs
described in this Agreement.
10.14 Construction and Amendment. The terms of this Agreement will be
construed in accordance with the plain meaning of the language used and will not be construed for
or against any Party by reason of the authorship of this Agreement or any other rule of construction
which might otherwise apply. The headings of sections and paragraphs of this Agreement are for
convenience or reference only and will not be construed to limit or extend the meaning of the
terms, covenants and conditions of this Agreement. This Agreement may only be amended by the
mutual consent of the Parties by an instrument in writing.
10.15 No Admissions. Nothing in this Agreement may be deemed an admission.
Moreover, no language that may have previously been circulated in prior drafts of this Agreement,
but subsequently removed at the request of a Producer, shall be used by either Party as evidence,
or in any other manner, in litigation currently pending in Los Angeles Superior Court between
OCWD and the City of Anaheim, Yorba Linda Water District, Golden State Water Company,
Mesa Water District, and East Orange County Water District on the one hand, and Irvine Ranch
Water District (IRWD) on the other, Case No. BS168278 [Lead Case] Case No. BS175192
[Consolidated Case] (the "Litigation"), as such Litigation may be amended from time to time.
10.16 Additional Parties. Notwithstanding any other provision of this Agreement,
OCWD is authorized to allow other groundwater pumpers in the Basin adversely impacted by
PFAS, but not named in this Agreement, to become Parties to and execute this Agreement without
obtaining the concurrence of the other Parties to this Agreement or otherwise modifying this
Agreement (except to add an additional signature block).
10.17 Effective Date and Binding Effect. The date OCWD executes this
Agreement shall be the Effective Date of this Agreement. Each Party executing the Agreement
thereafter shall be bound by, and benefit from, the terms of this Agreement on the date that Party
executes the Agreement, notwithstanding that other Parties have not yet executed the Agreement.
No Party shall be bound by this Agreement until such Party has executed this Agreement, nor shall
any Party that has executed this Agreement owe any contractual duty to any Party that has not yet
executed this Agreement until such other Parry executes this Agreement. The timelines referenced
in Sections 6.1(C) and 6.2 (G) of this Agreement shall begin to run on the date a Producer executes
this Agreement if such date is after the Effective Date.
10.18 Electronic Signatures. Any Party may execute this Agreement using an
"electronic signature," as that term is defined in California Civil Code Section 1633.2, or a "digital
signature," as defined by California Government Code Section 16.5. An electronic or digital
signature will have full legal effect and enforceability. Nothing in this Agreement requires any
Parry to use or accept the submission of any subsequent or related document containing an
electronic or digital signature where written notice is otherwise required by this Agreement.
[SIGNATURES FOLLOW]
2629/022499-0087
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i
4-21
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
B C/
Jeremy Jungreis
General Counsel, OCWD
Executed on April 15, 2020
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
[SIGNATURES CONTINUED]
ORANGE COUNTY WATER DISTRICT
B v
Y•
Vicente S 1de
By:
Markus, General Manager
CITY OF ANAHEIM
In
CITY OF FULLERTON
By:
CITY OF GARDEN GROVE
By:
CITY OF ORANGE
By:
26291022499-0087
14958393.1 a04/15120
-19-
4-22
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
ORANGE COUNTY WATER DISTRICT
By:
By: Vicente Sarmiento, President
Jeremy N. Jungreis By:
General Counsel, OCWD Michael R. Markus, General Manager
ATTEST:
APPROVED AS TO FORM: CITY OF NAH
Theresa Bas
City Clerk
By: By:
City Attorney
77
C wx,4r
APPROVED AS TO FORM: CITY OF FULLERTON
By: By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
[SIGNATURES CONTINUED]
2629/022499-0087
14979764.1 a04/17/20
CITY OF GARDEN GROVE
CITY OF ORANGE
-19-
4-23
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
By:
Jeremy N. Jungreis
General Counsel, OCWD
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By: for
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
[SIGNATURES CONTINUED]
262T022499.0087
14979764.1 a04- 17'20
ORANGE COUNTY WATER DISTRICT
0
Vicente Sarmiento, President
Michael R. Markus, General Manager
CITY OF ANAHEIM
CITY ULL
B
ke—•t0k:J�- A.
CITY OF GARDEN GROVE
e
CITY OF ORANGE
-19-
4-24
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
By:
Jeremy N. Jungreis
General Counsel, OCWD
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
ORANGE COUNTY WATER DISTRICT
By:
Vicente Sarmiento, President
By:
Michael R. Markus, General Manager
CITY OF ANAHEIM
CITY OF FULLERTON
APPROVED AS TO ORM: CITY OF GARDEN GROVE
By: By: �.
ity Atlorne�
APPROVED AS TO FORM:
By:
City Attorney
[SIGNATURES CONTINUED]
2629r022499-0087
14979764 1 a04;17120
CITY OF ORANGE
-19-
4-25
APPROVED AS TO FORM:
RUTAN & TUCKER, LLP
By:
Jeremy N. Jungreis
General Counsel, OCWD
APPROVED AS TO FORM:
By:
City Attorney
APPROVED AS TO FORM:
B y:
City Attorney
APPROVED AS TO FORM:
By:
City Attorney
[SIGNATURES CONTINUED)
2629/022499-00$7
14979764.1 aOV17120
ORANGE COUNTY WATER DISTRICT
LIM
Vicente Sarmiento, President
Michael R. Markus, General Manager
CITY OF ANAHEIM
CITY OF FULLERTON
IN
CITY OF GARDEN GROVE
CITY OF ORANGE
By:
Mark . Murphy, Mayor
T:
Pam e a Coleman, City Clerk
-19-
4-26
APPROVED AS TO FORM:
WOODRUFF, SPRADLIN & SMART,
By.
7A
avid E. Kendig
City Attorney, City of Tustin
ATTEST:
Daisy Gomez
Clerk of the Council
APPROVED AS TO FORM
SONIA R. CARVALHO, City Attorney
John M.Funk
Assistant City Attorney
APPROVED AS TO FORM:
ATKINSON, ANDELSON, LOYA, RUUD
& ROMO
Jeffrey A. Hoskinson
[SIGNATURES CONTINUED]
2629/022499-0087
14979764.1 a04/17/20
CITY OF TU I
By:
Dr. Allan ernstein, Mayor
CITY OF SANTA ANA
LN
Kristine Ridge
City Manager
RECOMMENDED FOR APPROVAL
Nabil Saba
Acting Executive Director
Public Works Agency
EAST ORANGE COUNTY WATER
DISTRICT
WE
-20-
Lisa Ohlund, General Manager
4-27
APPROVED AS TO FORM. -
WOODRUFF, SPRADLIN & SMART,
APC
IC
David E. Kendig
City Attorney, City of Tustin
ATTEST:;
Daisy Gomez
Clerk of the Council
APPROVED AS TO FORM
SONIA R. CARVALHO, City Attorney
By; (�4'�'• -f—L
An M. Funk
Assistant City Attorney
APPROVED AS TO FORM:
ATKINSON, ANDELSON, LOYA, RUUD
& ROMO
an
Jeffrey A. Hoskinson
[SIGNATURES CONTINUED]
2629/022499-0087
14979764.1 04M/20
CITY OF TUSTIN
Dr. Allan Bernstein, Mayor
CITY OF SANTA ANA
By:
'Tristine Ri ge
City Manager
RECOMMENDED FOR APPROVAL
NabiI Saba
Executive Director
Public Works Agency
EAST ORANGE COUNTY WATER
DISTRICT
-2d-
Lisa Ohlund, General Manager
4-28
APPROVED AS TO FORM:
WOODRUFF, SPRADLIN & SMART,
APC
By:
David E. Kendig
City Attorney, City of Tustin
ATTEST:
Daisy Gomez
Clerk of the Council
APPROVED AS TO FORM
SONIA R. CARVALHO, City Attorney
Bv:
John M. Funk
Assistant City Attorney
APPROVED AS TO FORM:
ATKINSON, ANDELSON, LOYA, RUUD
& ROMO
r
By:
Je y A. inson
[SIGNATURES CONTINUED]
2629.+022499-0087
14979764.1 041T20
CITY OF TUSTIN
Dr. Allan Bernstein, Mayor
CITY OF SANTA ANA
M.
Kristine Ridge
City Manager
RECOMMENDED FOR APPROVAL
Nabil Saba
Acting Executive Director
Public Works Agency
EAST ORANGE COUNTY WATER
D
1.9
-20-
4-29
APPROVED AS TO FORM:
HANSON BRIDGETT, LLP
By:
Claire H. Collins
APPROVED AS TO FORM:
VARCO & ROSENBAI;M ENVIRONMENTAL LAW GROUP
Y:
S. Wayne Rosenbaum
Counsel for Serrano Water District
APPROVED AS TO FORM:
Andrew B. Gagen
IRVINE RANCH WATER DISTRICT
Paul A. Cook, General Manager
SERRANO WATER DISTRICT
By:
Jerry . V' ander
YORBA LINDA WATER DISTRICT
2629/0224"-0037
I49797G4_t 44/t7/20
-21-
4-30
APPROVED AS TO FORM:
HANSON BRIDGETT, LLP
Claire H. Collins
APPROVED AS TO FORM:
S. Wayne Rosenbaum
APPROVED AS TO FORM:
KIDMAN GAGEN LAW, LLP
By: X;�/
Andrew B. Gage ,'
IRVINE RANCH WATER DISTRICT
Paul A. Cook, General Manager
SERRANO WATER DISTRICT
Jerry A. Vilander
YORBA LINDA WATER DISTRICT
By: / CCLA-C._?t
Marc Marcantonio, General Manager
2629i622499-0087
14979764.1 a04,17.20
-21-
4-31
Exhibit A
Allocation of Recovery
Example of proportionally dividing damages assuming litigation, after paying Shared Litigation
Counsel, results in a total damage pool of 75% of all damages ($630M) claimed by all Participating
Producers (total claims of $839M). The column to the far right reflects each co -plaintiff's
hypothetical recovery.
(Total Amount Claimed in Litigation by each co -plaintiff x .75)
(Dollar amounts shown are for illustrative purposes only and are not related to actual PFAS cost
that may be incurred or damages recovered. The numbers used herein are strictly hypothetical)
2629/022499-0087
14979764.1 a06/10/20
4-32
Exhibit B
Notice Addresses
Orange County Water District
P.O. Box 8300
18700 Ward Street
Fountain Valley, CA 92708
Attn: General Manager
Mike Markus
City of Anaheim
201 S. Anaheim Blvd., Suite 1101
Anaheim, CA 92805
Attn: Assistant General Manager of Water Services
Michael Moore
City of Fullerton
303 W. Commonwealth Ave.
Fullerton, CA 92843
Attn: Public Works Director
Meg McWade
City of Garden Grove
13802 Newhope Street
Garden Grove CA, 92843
Attn: Public Works Director
Bill Murray
City of Orange
P.O. Box 449
Orange, CA 92856
Attn: Public Works Director
Christopher Cash
City of Tustin
P.O. Box 466
Tustin, CA 92781
Attn: Water Resources Manager
Mike Grisso
2629/022499-0087
14979764.1 a06/10/20
4-33
City of Santa Ana
220 S. Daisy, Bldg. A
Santa Ana, CA 92703
Attn: Water Resources Manager
Nabil Saba
East Orange County Water District
185 N. McPherson Road
Orange, CA 92869-3720
Attn: General Manager
Lisa Ohlund
Irvine Ranch Water District
15600 Sand Canyon Avenue
Irvine, CA 92618
Attn: General Manager
Paul Cook
Serrano Water District
18021 Lincoln Street
Villa Park, CA 92861-6446
Attn: General Manager
Jerry Vilander
Yorba Linda Water District
P.O. Box 309
Yorba Linda, CA 92885-0309
Attn: General Manager
Brett Barbre
2629/022499-0087
14979764.1 a08/25/20
-2-
4-34