HomeMy WebLinkAboutC-2842 - Agreement Regarding Distribution and Sale of Green Acres Water ProjectF
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AGREEMENT BETWEEN
ORANGE COUNTY WATER DISTRICT
& CITY OF NEWPORT BEACH
REGARDING DISTRIBUTION AND SALE OF
GREEN ACRES PROJECT WATER
10 THIS AGREEMENT, made and entered into as of January 16, 1991 by
11 and between the ORANGE COUNTY WATER DISTRICT (hereinafter "OCWD")
12 and the CITY OF NEWPORT BEACH, (hereinafter "RETAILER").
13
14
15 RECITALS
16
17 A. OCWD was created by the OCWD Act, CL. 924, Stats. 1933, as
18 amended, for the purpose of protecting and managing the Orange County
19 groundwater basin. The OCWD Act empowers OCWD to manage the
20 groundwater basin, to provide for the conservation of the quantity and quality of
21 water in the groundwater basin, to conserve and reclaim water within or outside
22 of the boundaries of OCWD, to sell or otherwise to put the beneficial use water
23 or reclaimed wastewater in order to conserve groundwater resources, and to
24 distribute water to persons in exchange for ceasing or reducing the extraction of
25 groundwater from the groundwater basin.
26
27 B. OCWD purchases imported water from the Metropolitan Water
28 District of Southern California (hereinafter "MWD"), through its member public
29 agencies, for spreading and replenishment purposes, and obtains wastewater
30 from the County Sanitation Districts of Orange County (hereinafter "CSDOC")
31 for renovation -reclamation and groundwater injection.
32
33 C. Reclaimed wastewater currently produced by OCWD is suitable for a
34 number of non -potable uses, including, but not limited to, landscape irrigation
35 and industrial uses.
36
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1 D. RETAILER is a municipal corporation organized and existing
2 pursuant to the laws of the State of California. RETAILER is the exclusive retail
3 water purveyor, including water for residential, industrial, commercial, public
4 agency, agricultural and other uses, within RETAILER'S boundaries. RETAILER
5 currently distributes potable water in part purchased from the MWD and in part
6 produced from groundwater within its boundaries. The corporate and water service
7 boundaries of RETAILER are within the jurisdictional boundaries of OCWD.
8
9 E. Landscape irrigation and industrial water users within the
10 jurisdictional and service boundaries of RETAILER currently either purchase
11 potable water from RETAILER for their use, or produce water from the
12 groundwater basin by means of their own facilities for their own use, which
13 private groundwater production is under the jurisdiction and control of OCWD.
14
15 F. OCWD desires to develop, operate and maintain a water treatment
16 facility, transmission mains and distribution pipeline system (including
17 mainlines and service lines) and, in some cases, on -site plumbing, to be known
18 as the "Green Acres Project," for the purpose of reclaiming wastewater received
19 from CSDOC (hereinafter, "Project Water") and distributing the Project Water for
20 appropriate landscape irrigation and industrial purposes in order to supplement
21 and conserve the supply of potable groundwater available to the residents and
22 water users within the boundaries of OCWD. As of the date of this Agreement,
23 OCWD has designed and commenced construction of facilities for the first phase
24 of the Green Acres Project, to deliver Project Water for use within the
25 boundaries of the Cities of Santa Ana and Fountain Valley, and the Mesa
26 Consolidated Water District (hereinafter, the "Phase I Project Facilities"). OCWD
27 desires to construct facilities for the second phase of the Green Acres Project, to
28 deliver Project Water for use within the boundaries of RETAILER and the City of
29 Huntington Beach (hereinafter, the "Phase II Project Facilities"). A plat depicting
30 the location of the Phase II Project Facilities in Newport Beach is set forth as
31 Exhibit "A" hereto.
32
33 G. OCWD and RETAILER mutually acknowledge that the use of
34 reclaimed water for landscape irrigation is of mutual benefit to OCWD and
35 RETAILER in fulfilling their joint responsibilities for the conservation of water
36 resources in accord with Section 13550 and 13551 of the California Water Code.
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1 H. OCWD desires to sell Project Water to RETAILER for resale by
2 RETAILER to appropriate landscape irrigation and industrial water users within
3 the service boundaries of RETAILER, and RETAILER desires to purchase Project
4 Water from OCWD for such resale purposes.
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6
7 AGREEMENTS
8
9 NOW, THEREFORE, in consideration of the facts recited above and the
10 terms, covenants and conditions herein contained, the parties hereto agree as
11 follows:
12
13 SECTION ONE: FACILITIES FOR DELIVERY & DISTRIBUTION OF PROJECT WATER
14
15 1.1 OCWD shall enter into a contract or contracts on or before January 1,
16 1993, for the construction of the Phase II Project Facilities. A plat depicting that
17 portion of the Phase II Project Facilities which OCWD shall construct, operate and.
18 maintain within the boundaries of RETAILER is attached hereto as Exhibit "A".
19 OCWD shall cause the Phase II Project Facilities to be completed and operational
20 on or before June 1, 1995, and RETAILER shall incur no cost or liability in
21 connection with the design or construction of the Phase II Project Facilities.
22
23 1.2 The Phase 11 Project Facilities to be constructed shall include a
24 distribution pipeline system from the site of the Green Acres Project Water
25 Treatment Facility, to be located at 10500 Ellis Avenue, Fountain Valley, California,
26 to the point of connection to each of the proposed Project Water customers within
27 the boundaries of RETAILER (hereinafter, "Project Customers"), for the purposes of
28 distributing Project Water to RETAILER at the points of connection of the Project
29 Customers for purchase by RETAILER and resale to the Project Customers. In
30 addition to the construction of the Phase II Project Facilities, OCWD shall bear the
31 initial cost of installing meters and Project Water service connections to the Project
32 Customers, which Project Water service connections shall include a physical
33 connection to the Phase II Project Facilities, piping from such connection to a meter
34 vault, and a length of connecting pipe, not to exceed ten (10) feet in length. The
35 names and anticipated annual Project Water demands of each Project Customer are
36 set forth in Exhibit "B" hereto and incorporated herein by this reference.
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2 1.3 OCWD shall obtain all permits required to construct and operate the
3 Phase II Project Facilities, including the distribution pipeline system and
4 ancillary facilities to be located within the public rights of way or easements as
5 shown on Exhibit "A" hereto, as well as those facilities which are necessary to
6 produce, deliver and distribute Project Water for the herein described purposes;
7 and OCWD shall further obtain those permits that Project Customers may be
8 required to obtain. OCWD shall cause the Phase II Project Facilities within the
9 boundaries of RETAILER to be constructed in accord with the construction
10 standards of RETAILER in effect as of the date of the award by OCWD of the
11 contract or contracts for such construction. The Phase II Project Facilities shall be
12 owned by OCWD; provided, however, that RETAILER shall perform on behalf
13 of OCWD all maintenance, repair and replacement of the Phase II Project
14 Facilities located within the boundaries of RETAILER, pursuant to paragraph 4.1
15 herein below. In this regard:
16
17 1.3.1 OCWD agrees to restore roads, streets, alleys, avenues,
18 highways, drainage facilities, or any other public way or property used for
19 construction, operations, or maintenance of the Phase II Project Facilities
20 within RETAILER's boundaries to at least the same condition existing
21 prior to construction, operation or maintenance of the Phase II Project
22 Facilities, to the reasonable satisfaction of RETAILER's Director of Public
23 Works.
24
25 1.3.2 OCWD agrees to provide adequate safeguards to afford
26 security to life and property during construction, operation, and
27 maintenance of the Phase II Project Facilities, with due regard being given
28 to other existing uses of public roads, streets, alleys, avenues, highways,
29 drainage facilities, public ways and property within the boundaries of
30 RETAILER.
31
32 1.3.3 OCWD agrees to use its best efforts to minimize noise, dust,
33 pollution and problems relating to traffic congestion, police and fire
34 protection within the boundaries of RETAILER throughout construction,
35 operation and maintenance of the Phase II Project Facilities within
36 RETAILER's boundaries.
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1 1.3.4 The parties understand and agree that OCWD's rights to
2 construct, maintain, operate, inspect, repair and replace the Phase II Project
3 Facilities within the lands and right-of-way of RETAILER do not constitute
4 vested property rights and are expressly subject to and governed solely by
5 this Agreement.
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7 1.4 OCWD shall, at no cost to RETAILER, provide a metering device
8 meeting RETAILER's specifications, to be owned, operated and maintained by
9 RETAILER, for the purpose of measuring the quantity of Project Water purchased
10 by RETAILER and resold by RETAILER to each Project Customer. RETAILER shall
11 be responsible for ensuring the accuracy of the metering device. Any costs incurred
12 in modifying the size of existing RETAILER meters shall be the responsibility of
13 OCWD. The quantity of Project Water measured by the meters to be owned,
14 operated and maintained by RETAILER shall be the sole basis for determining the
15 quantity of Project Water delivered and sold by RETAILER to each Project
16 Customer under Section Two of this Agreement. In the event that a meter
17 measuring the quantity of Project Water delivered by RETAILER to a Project
18 Customer indicates a lesser quantity than OCWD's meter measuring the quantity
19 of Project Water delivered to RETAILER for resale to a Project Customer, OCWD
20 shall be responsible for the cost of such difference, and RETAILER shall not be
21 liable therefor. In the event RETAILER has a separate metering device serving
22 exclusively non -potable uses in the premises of a Project Customer, OCWD may
23 sell Project Water to RETAILER by connecting the Phase II Project Facilities
24 distribution pipeline system directly to the separate non -potable meter so long as
25 the standards and requirements of RETAILER and any other governmental agency
26 having jurisdiction over the quality of Project Water are satisfied.
27
28 1.5 In order to avoid the risk that Project Water may enter into
29 RETAILER's potable water distribution system, OCWD shall, at its own expense,
30 install on RETAILER'S potable water system a backflow prevention device or
31 devices approved by RETAILER in accord with RETAILER'S adopted standards at
32 a location or locations designated in writing by RETAILER. Such backflow
33 prevention devices shall be installed prior to the commencement of deliveries of
34 Project Water to a particular connection point. OCWD shall provide for separate
35 marking of the non -potable Project Water system in accord with standards and
36 regulations in existence as of the date of this Agreement.
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1 1.6 The Project Water distribution pipeline system shall be constructed by
2 OCWD with sufficient capacity to allow RETAILER to serve known landscape
3 irrigation and industrial water users. OCWD shall sell to RETAILER, and RETAILER
4 shall purchase for OCWD, sufficient quantities of Project Water for RETAILER to sell
5 to the projected Project Customers as shown on Exhibit "B", and such other and
6 future Project Customers as are provided for herein, but only to the extent that
7 RETAILER has contracts with such other and future Project Customers for the sale of
8 Project Water; provided, however, that a water user within the service boundaries of
9 RETAILER shall become a Project Customer only with the approval of both OCWD
10 and RETAILER; and provided further, that OCWD shall have the sole discretion to
11 determine whether to expand the Phase II Project Facilities or the production and
12 distribution capacity of the Green Acres Project Water Treatment Facility to meet any
13 future demand of Project Water that may be generated within the boundaries of
14 RETAILER. In this regard, the listing of Project Customers attached hereto as Exhibit
15 "B" represents a listing of both the known Project Customers as of the date of the
16 Agreement, and potential future Project Customers. OCWD and RETAILER mutually
17 understand and agree that additional landscape irrigationand/or industrial water
18 users within the boundaries of RETAILER may at some future time be served with
19 Project Water and become Project Customers without the necessity of amending this
20 Agreement. All future water users within the service boundaries of RETAILER who
21 become Project Customers shall execute an agreement for the purchase of Project
22 Water in the form attached hereto as Exhibit "C", and further shall be subject to the
23 Project Rules to be adopted by RETAILER pursuant to paragraph 5.3 herein below.
24
25 SECTION TWO: PURCHASE AND SALE OF PROJECT WATER
26
27 2.1 OCWD shall complete the construction and commence operation of
28 the Phase II Project Facilities by June 1, 1995, barring delays due to unforeseeable
29 causes beyond the control and without the fault or negligence of OCWD or its
30 contractors. If OCWD is permitted by all regulatory agencies having jurisdiction
31 over OCWD to distribute Project Water, then, during the term of this Agreement,
32 RETAILER shall have the exclusive right to purchase Project Water from OCWD,
33 at the point of connection to each Project Customer, and to resell Project Water to
34 the Project Customers shown on Exhibit "B," and such other landscape irrigation
35 and industrial water users within the boundaries of RETAILER that may be added
36 as Project Customers in accord with paragraph 1.6 above.
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1 2.2 Concurrently with and as a condition precedent to any obligations of
2 OCWD or RETAILER pursuant to this Agreement, RETAILER shall commit to
3 purchase Project Water for RETAILER's own use, and/or enter into separate
4 agreements with the proposed Project Customersin substantially the form to be
5 attached to and herein incorporated as Exhibit "C" for the purchase by Project
6 Customers of Project Water from RETAILER, contingent upon its availability from
7 OCWD. In the event RETAILER and other purveyors of Project Water are unable by
8 January 1, 1993, (or as otherwise agreed to in writing by OCWD) to commit to
9 purchase for their own use, or enter into agreements for the sale of, at least fifty
10 percent (50%) of the total demand, as set forth in Exhibit "B", for Project Water each
11 year during the term hereof, this Agreement shall terminate.
12
13 2.3 RETAILER shall commence the purchase and resale of Project Water
14 upon receiving at least ninety (90) days advance written notice from OCWD of the
15 availability of such Project Water.
16
17 2.4 RETAILER shall purchase the Project Water from OCWD, at the point of
18 its metered connection, for an amount to be determined by the OCWD Board of
19 Directors in its discretion, not to exceed eighty percent (80%) of the "area groundwater
20 cost" as defined in Section 2.5 herein below. The point of connection and sale of the
21 Project Water from OCWD to RETAILER shall be at the meter which measures the flow
22 of Project Water to each Project Customer, as described in Section 1.4 herein above.
23
24 2.5 For the purpose of the Agreement, the "area groundwater cost" shall be
25 the same as the fixed and variable costs of groundwater production as listed in the
26 most recent OCWD Engineer's Report prepared pursuant to Section 31.5 (a) of the
27 OCWD Act, plus the replenishment assessment imposed by OCWD pursuant to the
28 authority contained in Section 27 of the OCWD Act, and any additional
29 replenishment assessments which may be imposed by OCWD pursuant to the
30 authority contained in Section 27.1 of the OCWD Act, which replenishment
31 assessments and additional replenishment assessments are established in April of
32 each year but do not become effective until the following July of each year. The
33 parties mutually recognize and agree that the area groundwater cost may change
34 each year during the term of this Agreement, as a function of changes in the cost of
35 operation and maintenance, energy, the replenishment assessment levied by
36 OCWD, and the levy of any additional replenishment assessment by OCWD.
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1 2.6 The governing body of RETAILER shall establish the rate for the
2 resale of Project Water to each Project Customer, in an amount not to exceed
3 eighty percent (80%) of the "potable water" rate established by RETAILER.
4
5 2.7 RETAILER shall read the Project Water meter for each Project
6 Customer on a sixty (60) day cycle. The Project Water meter reading date shall
7 coincide with RETAILER's reading of the meter which measures the quantity of
8 potable water delivered by RETAILER to the Project Customer that month. Within
9 sixty (60) days thereafter, RETAILER shall transmit to OCWD a statement setting
10 forth the Project Water rate established by RETAILER pursuant to paragraph 2.6
11 during that billing period, a description of the maintenance, repair and
12 replacement activities of RETAILER, and the amount of such actual costs incurred
13 by RETAILER, pursuant to Section 4.1 herein below during that billing period, and
14 indicating, for each Project Customer, the current meter reading, the previous
15 meter reading, and the total quantity of Project Water purchased from OCWD and
16 resold by RETAILER to such Project Customer during the billing period. Together
17 with this statement, RETAILER shall transmit to OCWD payment in accordance
18 with paragraphs 2.4 and 2.5 for the Project Water purchased from OCWD by
19 RETAILER and resold by RETAILER to all of the Project Customers during the
20 billing period, after deducting therefrom the actual costs incurred by RETAILER in
21 maintaining, repairing and replacing the Project Water distribution system within
22 RETAILER's boundaries as set forth in Section 4.1 herein below.
23
24 SECTION THRFF: PROJECT WATER QUALITY REGULATIONS.
25
26 3.1 OCWD shall deliver and sell to RETAILER pursuant to this
27 Agreement Project Water that shall conform to all current and future
28 requirements established by the California Regional Water Quality Control.
29 Board - Santa Ana Region , and all other federal, state and local agencies having
30 jurisdiction to fix minimum standards for the anticipated landscape irrigation
31 and industrial uses of the Project Water by the Project Customers listed in Exhibit
32 "B" hereto. The anticipated quality of Project Water shall be shown as on Exhibit
33 "D" attached hereto and incorporated herein, or as subsequently amended to
34 conform to any future regulatory requirements for such use; provided however,
35 that OCWD shall not have any obligation to modify the quality of Project Water
36 to meet the needs of any particular Project Customer.
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1 3.2 During the term of this Agreement, OCWD shall pay all costs imposed
2 by any and all governmental agencies having jurisdiction over the quality or use of
3 Project Water for the issuance of any permits, licenses or approvals required for the
4 production, treatment, distribution or sale of Project Water. OCWD further shall be
5 responsible for paying charges, fees, surcharges, assessments or other sums imposed
6 or levied upon Project Water by the Coastal Municipal Water District.
7
8 3.3 OCWD shall inform RETAILER promptly after becoming aware of
9 any proposed or actual modifications by any agency having jurisdiction over the
10 quality of Project Water to any requirements governing the minimum standards
11 of quality for the use of Project Water, or of any changes in the legally permissible
12 uses which might affect the use of the Project Water, sold by OCWD to RETAILER
13 for resale by RETAILER to Project Customers, and OCWD shall bear all costs of
14 conforming to any such future requirements. RETAILER shall have no obligation
15 to pay the cost of meeting any future requirements governing the standards of
16 quality for, or use of, Project Water.
17
18 cErrroN FOUR: OPERATING OBLIGATIONS OF THE PARTIES.
19
20 4.1 During the term of this Agreement, OCWD shall manage, operate and
21 maintain the Phase II Project Facilities in an efficient manner and in accord with the
22 highest standards of skill and workmanship; provided, however, that OCWD hereby
23 contracts with RETAILER for the performance by RETAILER of the actual
24 maintenance, repair and replacement responsibilities with respect to those Phase II
25 Project Facilities located within the service boundaries of RETAILER. RETAILER
26 recognizes the special quality considerations relating to Project Water, and RETAILER
27 shall perform its maintenance, repair and replacement responsibilities in an efficient
28 manner and in accord with the highest standards of skill and workmanship. OCWD
29 retains the right, upon sixty (60) days written notice to RETAILER, to make repairs to
30 Phase II Project Facilities within the service boundaries of RETAILER if they are not
31 made by RETAILER in a timely or efficient manner. RETAILER shall receive as a
32 credit against all monies due OCWD pursuant to paragraph 2.8 herein above for the
33 sale of Project Water the cost of such maintenance, repair and replacement activities
34 actually undertaken by or on behalf of RETAILER, which costs shall include the actual
35 labor, material and equipment costs, plus overhead costs, incurred by RETAILER and
36 necessary for such maintenance, repair and replacement activities.
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2 4.2 Notwithstanding the provisions of paragraph 4.1, the operating
3 responsibility of OCWD with respect to the Green Acres Project Water
4 Treatment Plant and the Phase II Project Facilities shall include the
5 maintenance of quality, quantity and pressure of the Project Water, and
6 compliance with all regulatory requirements and conditions applicable to the
7 distribution .and sale of Project Water, to the point of connection to each
8 Project Customer.
9
10 4.3 OCWD shall bear the initial cost of installing meters and "GAP"
11 service connections to the Project Customers. Said "GAP" service connections
12 shall include a physical connection to the "GAP" pipeline, a valve, a run of pipe
13 to a meter vault, and a length of connecting pipe on the customer side of the
14 vault, not to exceed 10 ft. in length. RETAILER shall, at no cost to OCWD,
15 assume ownership of, service, maintain and read the Project Water meter,
16 valves and meter enclosure (box/vault) for each Project Customer in the same
17 manner that RETAILER would for a customer service meter attached to its
18 potable water system. RETAILER further shall, at no cost to OCWD, be
19 responsible for customer service functions relating to Project Customers,
20 including but not limited to billing and collection of payments for Project
21 Customers for the Project Water, record keeping, and notification to OCWD of
22 the quantity of Project Water delivered through the Project Customer's meter
23 during each meter reading period.
24
25 4.4 OCWD shall have the right to review the books, records and
26 accounts maintained by RETAILER relating to the Project Water and Project
27 Customers during normal business hours, upon forty-eight (48) hours prior
28 written notice to RETAILER.
29
30 4.5 OCWD shall operate the Phase II Project Facilities in such a
31 manner that the Project Water shall be delivered to the point of connection
32 to each Project Customer on a continuous basis at a pressure of not less than
33 sixty (60) pounds per square inch between the hours of 8:00 p.m. and 6:00
34 a.m., and not less than twenty (20) pounds per square inch the hours of 6:00
35 a.m. and 8:00 p.m.
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1 4.6 Except as provided in paragraph 8.6 herein below, in the event that, at
2 any time during the term of this Agreement, OCWD for any reason cannot or
3 chooses not to produce Project Water from its Green Acres Project Water
4 Treatment Facility described in paragraph 1.2 herein above, OCWD shall provide
5 through the Phase II Project Facilities, or otherwise, at a cost equal to the cost of
6 Project Water, sufficient water of a quality and pressure at least equal to that of
7 Project Water to meet the landscape irrigation and industrial water needs of all of
8 the Project Customers; provided, however, that OCWD shall have no such
9 obligation in the event that Project Water cannot be delivered to Project
10 Customers due to damage to, breaks or other disruptions in the distribution
11 facilities transporting Project Water to Project Customers.
12
13
14 SECTION FIVE: PROJECT WATER RULES AND REGULATIONS.
15
16 5.1 All Project Water produced by OCWD for delivery and sale to
17 RETAILER shall be in accord with terms and conditions of the discharge
18 requirements and primary user permit for the Project Water issued to OCWD by
19 the California Regional Water Quality Control Board - Santa Ana Region. OCWD
20 has obtained and shall maintain a blanket primary user permit for the production,
21 distribution and sale of Project Water, and shall at all times maintain such permit
22 and bear all costs in complying with all present and future provisions thereof and
23 all renewals or subsequent such permits.
24
25 5.2 OCWD shall promulgate and enforce rules and regulations regarding the
26 distribution, delivery and sale of Project Water to RETAILER, and governing the use of
27 Project Water resold by RETAILER to Project Customers (hereinafter, the "Project
28 Rules"). OCWD shall pay all costs incurred in the drafting and preparation of the
29 Project Rules. OCWD shall obtain all requisite certifications and approvals from all
30 federal, state and local agencies having jurisdiction over the production, quality and
31 use of Project Water, including, but not limited to, the California Regional Water
32 Quality Control Board - Santa Ana Region, and the State of Califomia Department of
33 Health, that such Project Rules comply with the regulations, requirements and orders
34 of such regulatory agencies.
35
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1 5.3 OCWD shall transmit to RETAILER such approved Project Rules for
2 adoption by RETAILER, and RETAILER shall, within ninety (90) days after receipt
3 thereof, incorporate the Project Rules into RETAILER's promulgated rules and
4 regulations governing the distribution, delivery and sale of water within the service
5 boundaries of RETAILER. Promptly upon adoption, RETAILER shall transmit to
6 OCWD RETAILER's adopted Project Rules, and RETAILER shall notify OCWD of any
7 amendments to or modifications of the Project Rules adopted by RETAILER. Should
8 OCWD choose either to make reasonable amendments or modification to the
9 Project Rules not contrary to this Agreement, or be required by any governmental
10 agency exercising jurisdiction over the distribution, sale or use of the Project Water to
11 modify or amend the Project Rules, OCWD shall promptly furnish such modifications
12 or amendments to RETAILER; and RETAILER shall, after being provided a ninety (90)
13 day period in which to review, comment upon, and/or meet and confer with OCWD
14 regarding such proposed modifications or amendments, incorporate such
15 modifications or amendments into RETAILER's adopted rules and regulations.
16
17 5.4 RETAILER shall include in its promulgated rules and regulations
18 provisions requiring, whenever feasible and if Project Water is available, that any
19 new or future customer of RETAILER, as a condition to receiving potable water
20 service from RETAILER, to become a Project Customer and to accept and use
21 Project Water in lieu of RETAILER's potable water supply for appropriate
22 landscape irrigation and industrial purposes. RETAILER shall further include in its
23 promulgated rules and regulations a requirement that any new or future Project
24 Customers permit representatives of OCWD and RETAILER to enter the premises
25 of the Project Customers at all reasonable times for the purpose of monitoring,
26 inspecting, analyzing and observing the Project Customer's on -site Phase II Project
27 Water facilities and the utilization of Project Water by the Project Customer.
28
29 5.5 For purposes of paragraph 5.4 of this Agreement, "feasibility" shall be
30 presumed if OCWD and RETAILER mutually determine in their discretion that Project
31 Water is available and that the Green Acres Project Water Treatment Facility and the
32 Phase II Project Facilities can accommodate the new or future landscape irrigation or
33 industrial water customer of RETAILER. For purposes of Section 5.4 of the
34 Agreement, the use of Project Water for landscape irrigation or industrial uses shall
35 be presumed "appropriate" if the use of Project Water by a new or future Project
36 Customer for landscape irrigation or industrial applications will neither violate any
12
1 5.5 Continued...
2 minimum water quality or health standards established by any federal, state or local
3 agency having jurisdiction over the quality of Project Water, nor significantly and
4 adversely affect either the Project Customer's plantings or the industrial processes or
5 products served by the Project Water.
6
7 5.6 In connection with RETAILER's adoption of the Project Rules as part of
8 its rules and regulations, and at the request of RETAILER, OCWD shall cooperate with
9 and assist RETAILER in obtaining from the State of California Water Resources Control
10 Board any necessary certifications, findings or orders authorized under Section 13550
11 and 13551 of the California Water Code to require the use of Project Water for
12 landscape irrigation uses within the service boundaries of RETAILER.
13
14 5.7 The parties understand and agree that Project Water delivered and sold by
15 OCWD to RETAILER pursuant to the terms of this Agreement has limited uses, and
16 OCWD shall deliver and sell to RETAILER Project Water only for those uses and
17 purposes which are legally permissible under laws of the State of California and the
18 rules, regulations and directions of the appropriate federal, state and local regulatory
19 agencies exercising jurisdiction over the quality and use of Project Water. In this regard,
20 OCWD and RETAILER shall cooperatively enforce Project Rules limiting the use of
21 Project Water to legally permissible landscape irrigation and industrial applications, and
22 shall monitor the use of Project Water by Project Customers to safeguard against any
23 misuse or improper application of Project Water by Project Customers.
24
25 SECTION SIX: INDEMNITY AND INSURANCE
26
27 6.1 OCWD shall save RETAILER harmless from and against and shall
28 indemnify RETAILER from any liability, loss, costs, expenses or damages however
29 caused by reason of any injury (whether to body, property, or personal or business
30 character or reputation) sustained by or to any person or property by reason of any
31 act, neglect, default, or omission of OCWD or any of its agents, employees, or
32 representatives, or caused by reason of the design, construction, operation or
33 maintenance of the Project Facilities, or the distribution and sale to RETAILER for
34 resale purposes herein of Project Water that does not meet quality standards set
35 forth in Title 22 of the California Code of Regulations. However, OCWD shall not
36 be responsible for any of the following:
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1 (a) The negligent operation, maintenance or repair of the Phase II
2 Project Facilities within RETAILER's service boundaries by RETAILER; or
3 (b) The negligent operation, maintenance or repair by RETAILER or
4 any Project Customer of Project Water distribution and storage facilities located on
5 the lands of any Project Customer; or
6 (c) The misuse or misapplication of Project Water on the Project
7 Customer's side of the Project Water meter by any person, including RETAILER or
8 any Project Customer.
9 If RETAILER is sued in any court for damages by reason of any of the
10 acts for which OCWD is required to indemnify RETAILER in this paragraph 6.1,
11 induding but not limited to damages arising out of a products liability claim, OCWD
12 shall defend said action (or cause same to be defended) at its own expense and shall
13 pay any and all amounts of judgement that may be rendered in any such action. If
14 OCWD fails or neglects to so defend in said action, RETAILER may defend the same
15 and any expenses, including reasonable attorneys' fees, which it may pay or incur in
16 defending said action and the amount of any judgment which it may be required to
17 pay shall be promptly reimbursed upon demand. Nothing herein is intended to nor
18 shall it relieve RETAILER or any Project Customer from liability for its own acts,
19 omissions, or active or passive negligence.
20
21 6.2 OCWD shall cause RETAILER to be named as an additional insured on
22 OCWD's general liability policy of insurance with respect to the sale and distribution
23 to RETAILER of Project Water within the service boundaries of RETAILER, and
24 OCWD shall provide RETAILER with certificates of insurance and endorsements
25 evidencing such insurance coverage; provided, however, that nothing shall preclude
26 OCWD from maintaining self insurance with respect to the sale, distribution and use
27 of Project Water, in lieu of purchasing insurance as provided for herein.
28
29 6.3 OCWD shall not commence nor permit any contractor or subcontractor
30 to commence work on construction of any of the Phase II Project Facilities that are
31 located with the service boundaries of RETAILER until OCWD has obtained, or has
32 caused its contractors to obtain, comprehensive general liability insurance providing
33 coverage for bodily injury, personal injury and property damage, and which shall
34 include as additional insureds RETAILER, its officers, agents and employees, but
35 only while acting in their capacity as such and only as respects operations of the
36 original named insured, its subcontractors, agents, officers and employees in the
14
1 6.3 Continued...
2 performance of the construction contract. OCWD shall furnish RETAILER with
3 certificates of insurance and endorsements showing insurance coverage as described
4 above. RETAILER shall incur no expense in connection with obtaining and
5 maintaining any insurance required under paragraphs 6.2 and 6.3.
6
7 SECTION smain DISPUTES
8
9 7.1 In the event of any dispute arising under this Agreement, the
10 parties hereto agree to utilize the arbitration procedure set forth in this Section
11 Seven as the sole and exdusive means of resolving such dispute.
12
13 7.2 Arbitration shall be initiated by any party hereto serving upon any
14 other party a written demand for arbitration, which demand shall describe with
15 specificity the nature of the dispute. Except as specified herein, the arbitration shall
16 be conducted pursuant to the provisions of California Code of Civil Procedure,
17 Section 1280, et seq. The parties hereto agree that there shall be a single neutral
18 arbitrator who shall be a civil engineer knowledgeable in water facilities operation
19 and reclaimed wastewater, who shall be selected in the following manner: (A) The
20 demand for arbitration shall include a list of names of five (5) persons acceptable to
21 the demanding party for appointment as arbitrator. The responding party shall
22 determine if any of the names submitted are acceptable, and, if so, shall inform the
23 other party within ten (10) days of actual receipt of the arbitration demand, and
24 such person will be designated as arbitrator; (B) In the event that none of the
25 names submitted by the demanding party is acceptable to the responding party, or
26 if for any reason the arbitrator selected is unable to serve, the responding party
27 shall submit to the demanding party a list of names of five (5) persons acceptable to
28 the responding party for appointment as arbitrator. The demanding party shall in
29 turn have ten (10) days from actual receipt of the list in which to determine if one
30 such person is acceptable; (C) If the parties are unable mutually to agree upon a
31 neutral arbitrator, qualified as above, the matter of selection of an arbitrator
32 qualified as above, shall be submitted to the Orange County Superior Court
33 pursuant to Code of Civil Procedure Section 1281.6. Upon selection of an arbitrator,
34 the arbitration shall be conducted consistent with the provisions of Code of Civil
35 Procedure Section 1280, et seq., as are deemed practicable by the arbitrator,
36 considering the nature of the dispute.
15
• •
1 7.3 The costs of arbitration, including but not limited to reasonable
2 attorney's fees, shall be recoverable by the party prevailing in the arbitration. If
3 an arbitration conducted hereunder is appealed to a court pursuant to the
4 procedures set forth in Code of Civil Procedure Section 1280, et seq., the costs of
5 arbitration shall also include court costs associated with such appeals, including
6 but not limited to reasonable attorney's fees.
7
8 SECTION EIGHT• MISCELLANEOUS PROVISIONS
9
10 8.1 Notices: All Notices, payments, transmittals of documentation and
11 other writings required or permitted to be delivered or transmitted to any of the
12 parties under this Agreement shall be personally served or deposited in a United
13 States mail depository, first class postage prepaid, and addressed as follows:
14
15 If to OCWD: Orange County Water District
16 10500 Ellis Avenue
17 P.O. Box 8300
18 Fountain Valley, California 92708
19 Attention: William R. Mills Jr., General Manager
20
21 If to RETAILER City of Newport Beach
22 Office of the City Clerk
23 3300 Newport Boulevard
24 P.O. Box 1768
25 Newport Beach, California 92659-1768
26 Attention: Jeff Staneart, Deputy Utilities Director
27
28 or such other address as OCWD or RETAILER shall direct in writing. Service of any
29 instrument or writing by mail shall be deemed complete forty-eight (48) hours after
30 deposit in a United States mail depository.
31
32 8.2 Term and Amendment: The term of this Agreement shall be for
33 twenty-five (25) years from the date hereof. This Agreement shall automatically be
34 extended for up to five (5) extensions of five (5) years each, for a possible total
35 extension of twenty-five (25) additional years to the initial term hereof, if neither
36 party hereto exercises its right to terminate the extensions to the initial term of this
16
1 8.2 Continued...
2 Agreement. Either party shall have the right to terminate any extension to the
3 initial term of this Agreement by written notice to the other at least four (4) years
4 prior to the expiration of the initial term or any extension of this Agreement. Except
5 as provided in paragraph 1.6 herein above, this Agreement may only be amended or
6 modified by mutual agreement in writing of OCWD and RETAILER.
7
8 8.3 Limitation on Sales by OCWD: OCWD acknowledges and agrees that,
9 except as provided herein or with the prior written consent of RETAILER, OCWD
10 is not now and will not in the future become a wholesale or retail seller of Project
11 Water within the service boundaries of RETAILER, and OCWD further agrees that
12 it will not use or contract with any entity other than RETAILER for the purpose of
13 selling and distributing Project Water within the service boundaries of RETAILER.
14
15 8.4 Basin Limitations: OCWD and RETAILER mutually understand and
16 agree that any and all Project Water delivered and sold by OCWD hereunder shall
17 not constitute either "supplemental sources" or "groundwater supplies" for the
18 purpose of the annual establishment of basin groundwater production requirements
19 and limitations by OCWD pursuant to Section 31.5 of the OCWD Act. Project Water
20 is hereby established as a separate class of water for the purpose of Section 31.5 of the
21 OCWD Act.
22
23 8.5 Conditions Precedent: The performance of this Agreement is
24 conditioned upon OCWD's being able to acquire acceptable rights of way and access
25 rights from its existing facilities to the points of connection to Project Customers, as
26 set forth in the plat attached hereto as Exhibit "A", and is further conditioned upon
27 the approval by all federal, state and local regulatory agencies having jurisdiction
28 over the Green Acres Project and Project Water.
29
30 8.6 Conditions Subsequent: The performance of this Agreement is
31 conditioned upon OCWD's continued ability to feasibly produce and distribute
32 Project Water for sale to RETAILER and resale by RETAILER to Project Customers
33 in a cost-effective manner. Subsequent to the date of this Agreement, should
34 OCWD determine in its sole discretion that unanticipated increases in the cost of
35 producing or distributing Project Water or new or modified regulatory
36 requirements governing the production, distribution, quality or use of Project
17
1 8.6 Continued,
2 Water render the Green Acres Project economically unfeasible, OCWD may cease
3 production and distribution of Project Water upon ninety (90) days written notice
4 to RETAILER. In the event that OCWD ceases the production and distribution of
5 Project Water pursuant to this paragraph 8.6, this Agreement shall terminate and
6 OCWD shall incur no liability to RETAILER or any Project Customer by reason of
7 the termination of this Agreement or the termination of production and delivery
8 of Project Water; provided, however, that if OCWD ceases the production and
9 distribution of Project Water pursuant to this paragraph 8.6 within ten (10) years
10 immediately following the date of this Agreement, OCWD shall pay the cost of
11 connecting or reconnecting the landscape irrigation or industrial water facilities of
12 each Project Customer then connected to the Phase 11 Project Facilities to the
13 domestic water distribution facilities of RETAILER.
14
15 8.7 No Duplication of Services Intended or Created: OCWD and
16 RETAILER mutually understand and agree that the construction and operation
17 of the Phase II Project Facilities and the distribution and sale of Project Water by
18 OCWD to RETAILER for sale by RETAILER to Project Customers pursuant to
19 this Agreement does not constitute either a duplication of RETAILER's retail
20 water service or a taking of any property of RETAILER within the meaning of
21 Section 1501, et seq. of the California Public Utilities Code. RETAILER shall
22 have no right to institute any action against OCWD pursuant to Sections 1503,
23 1504 or 1505.5 of the Public Utilities Code by reason of the construction and
24 operation of the Phase II Project Facilities and the distribution and sale of
25 Project Water by OCWD to RETAILER in conformance with this Agreement.
26
27 8.8 Warranty: OCWD represents and warrants that under the OCWD
28 Act OCWD, without the consent of any other public agency water purveyor,
29 may enter into this Agreement to deliver and sell Project Water to RETAILER
30 for resale by RETAILER to Project Customers or lands within the service
31 boundaries of RETAILER.
32
33 8.9 Construction: This Agreement shall be construed according to
34 its plain meaning and as if prepared by all parties hereto. This Agreement
35 shall be governed by and construed in accord with the laws of the State of
36 California.
18
• •
1 8.10 Integration: The parties herein have set forth the whole of their
2 agreement, and the performance of this Agreement constitutes the entire
3 consideration intended herein.
4
5 8.11 Successors: This Agreement and all of the provisions herein, shall
6 be binding upon and inure to the benefit of OCWD and RETAILER, and their
7 respective successors and assigns.
8
9 WHEREFORE, the parties herein have executed this Agreement as of
10 the date set forth above.
11
12 APPROVED AS TO FORM:
13 Rutan & Tucker
14
15
16 By:_
17 I ' eneral Counsel or
18 Orange County Water District
19
20
21
22
23
24
25 APPROVED AS TO FORM:
26
27
28
29
City Attorney's Office
30 City Attorney
19
ORANGE COU M WATER DISTRICT
A Special Gov jftntal District
By:
sident of the Board
CITY OF NEWPORT BEACH
A Municipal Corporation
B
• •
Orange County Water District
Green Acres Project
in the.
City of Newport Beach
N. \C��gq:1 /?fir\
I
Green Acres
OPotential User
----Transmission Pipeline
Preliminary Alignment(s)
--City Boundary
Potential Users
No. Location
1. Newport Beach Country Club
2. Bayview County Pork
3. Bayview Slope Irrigation
4. C.D.M. Freeway Irrigation
5. Bonita Creek Park
6. Eastbluff Community Green Belt
7. Eastbluff Community Green Belt
8. Eastbluff Community Green Belt
9. C.O.M. High School Grounds
10. Eastbluff Park
11, Big Canyon Golf Course
12. Big Canyon Golf Course
j—Bna ON ]R,4•NhL PL T Y
SCALE: 1" = 1200'
0 E 0 B A 5 E— UTILITIES DEPARTMENT
SEPTEMBER 1990
EXHIBIT A
EXHIBIT'B"
PROJECTED GREEN ACRES PROJECT CUSTOMERS IN NEWPORT BEACH
Potential User
Estimated Average Demand
Acre Feet / Year Gallons / Minute
Newport Beach Country Club 375 232
Bayview County Park 20 12
Bayview Slope Irrigation 15 9
CDM Freeway Irrigation 30 19
Bonita Creek Park 45 28
Eastbluff Community Greenbelts 194 120
CDM High School 62 38
Eastbluff Park 25 16
Big Canyon Golf Course 448 278
Total 1,214 752
•
EXHIBIT "C"
FORM OF PROJECT CUSTOMER SALES AGREEMENT
(Agreement between the City of Newport Beach and each recalimed water user,
prepared by the City of Newport Beach)
• •
EXHIBIT "D"
TYPICAL WATER QUALITY TO BE SUPPLIED
TO
GREEN ACRES PROJECT CUSTOMERS
concentration range
Component mg / 1
Total Dissolved Solids 950 - 1,050
Hardness 300 - 350
Calcium 80 - 100
Magnesium 20 25
Potassium 12 14
Sodium 190 - 240
Bicarbonate 260 - 280
Chloride 230 - 300
Sulphate 220 - 240
Boron 0.6 - 0.8
Fluoride 1.1 - 1.5
Silica 21 - 24
Nitrogen - Total N 20 30
Phosphorous - Total P 5.0 - 5.6
Chemical Oxygen Demand
30 40