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CC 6 GDWTR RECOVERY 10-05-92
CONSENT CALENDAR NO. 6 _N D AA 10-5-92 6,\ 4� j��=--a J T Inter -Com DATE: OCTOBER 5 , 1992 WILLIAM A. HUSTON, CITY MANAGER TO: FROM: PUBLIC WORKS DEPARTMENT/WATER DIVISION SUBJECT: SEVENTEENTH STREET DESALTER PARTICIPATION IN METROPOLITAN WATER DISTRICT (MWD) GROUNDWATER RECOVERY PROGRAM (GRP) RECOMMENDATION: That the City Council, at its meeting of October 5, 1992, authorize the Mayor to enter into the Tustin Desalter Project Joint Participation Agreement for Recovery and Utilization of Contaminated Groundwater between the Metropolitan Water District of Southern California , the Municipal Water District of Orange County, the Orange County Water District (OCWD), the Fast Orange County Water District, and the City of Tustin. BACKGROUND: The City Council, at its meeting of February 18, 1992, approved an agreement with the OCWD for construction, operation and acquisition of a groundwater desalter. A critical element of that agreement is that the project be eligible for and participate in the Metropolitan Water District (MWD) Groundwater Recovery Program (GRP). Execution of this agreement places the Seventeenth Street Desalter in that program. DISCUSSION: The GRP was developed in order to encourage agencies to more fully develop currently unusable groundwater resources within their service areas. The program will- compensate the City for treatment costs which are in excess of MWD rates at any given time, up to a maximum of $250.00 per acre foot (AF) . The preliminary design report for the Seventeenth Street Desalter is complete and available for City Council review. Current projections indicate that treatment costs, including capital recovery, will be approximately $584.00 per acre foot. At the projected MWD rate for 1993/1994 ($465/AF) the treatment cost could be as high as $715.00 per acre foot ($465 + 5250) and still be feasible. It is important to note that water produced by the Desalter will be exempt from any OCWD pumping limitations, and is therefore, directly price competitive with water the City would otherwise have to purchase from MWD. Page 2 - Ground Water --' -overy Program Commencement of the final design phase of this project has been deferred pending negotiation and approval of this agreement. Listed below are current milestone projections for this project. October 13 1992 Begin Final Design May 14, 1993 Complete Final Design and Advertise for Bids June 25, 1993 Open Bids July 30, 1993 Award Contract March 30, 1994 Begin Testing April 15, 1994 Final Out and Acceptance Bob Ledendecker Director of Public Works/City Engineer BL: GRV : bam Attachments 11 Gary R. Veeh Water Service Manager TUSTIN DESALTER PROJECT JOINT PARTICIPATION AGREEMENT FOR RECOVERY, UTILIZATION OF CONTAMINATED GROUNDWATER BETWEEN THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, THE MUNICIPAL WATER DISTRICT OF ORANGE COUNTY, THE ORANGE COUNTY WATER DISTRICT, THE EAST ORANGE COUNTY WATER DISTRICT AND THE CITY OF TUSTIN TABLE OF CONTENTS Recitals. . . . . . . . . . . . . . . . . . . . Page Section 1. Definitions . . . . . . . . . . . . . . . . . . . . 2. Warranties . . . . . . . . . . . . . . . . . . . . 3. Construction Responsibilities . . . . . . . . . . . 4. Ownership of Facilities . . . . . . . . . . . . . . 5. Operating Responsibilities . . . . . . . . . . . . 6. Interruption of Water Supply . . . . . . . . . . . 7. Metering . . . . . . . . . . . . . . . . . . . . . 8. Record Keeping . . . . . . . . . . . . . . . . . . 9. Project Unit Cost, Agreement Purchase Price and Deferred Cost. . . . . . . . . . . • . • . • 10. Purchase of Allowable Yield . . . . . . . . . • 11. Resale to MWDOC and Tustin . . . . . . . . . . . . 12. Project Water Rates . . . . . . . . . . . . . . . . 13. Term and Amendments . . . . . . . . . . . . . . . . 14. Insurance and Indemnity . . . . . . . . . . . . . . 15. Notice . . . . . . . . . . . . . . . . . . . . . . 16. Successors and Assigns 17. Severability . . . . . 18. Entire Agreement . . . 19. Governing Law . . . . 20. Signatures Exhibits Exhibit A (Tustin Desalter Project Description and Map) Exhibit B (Annualized Capital Component) Exhibit C (Operation and Maintenance Component) Exhibit D (Annualized Replacement Component) Exhibit E (Deferred Cost) Exhibit F (Agreement between Tustin and OCWD) Exhibit G (Certificate of Insurance) TUSTIN DESALTER PROJECT JOINT PARTICIPATION AGREEMENT FOR RECOVERY AND UTILIZATION OF CONTAMINATED GROUNDWATER BETWEEN THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, THE MUNICIPAL WATER DISTRICT OF ORANGE COUNTY, THE ORANGE COUNTY WATER DISTRICT, THE EAST ORANGE COUNTY WATER DISTRICT AND THE CITY OF TUSTIN THIS AGREEMENT is made and entered into as of 1992, by and among THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA (hereinafter "Metropolitan"), THE MUNICIPAL WATER DISTRICT OF ORANGE COUNTY (hereinafter "MWDOC"), the ORANGE COUNTY WATER DISTRICT (hereinafter OCWD), the EAST ORANGE COUNTY WATER DISTRICT (hereinafter "EOCWD"), and THE CITY OF TUSTIN (hereinafter "Tustin"). RECITALS WHEREAS, Metropolitan was incorporated under the Metropolitan Water District.Act ("Act") for the purpose of developing, storing, and distributing water for domestic and municipal purposes; WHEREAS, the Act empowers Metropolitan to acquire water and water rights within or without the State; develop, store and transport water; provide, sell and deliver water at wholesale for domestic and municipal uses and purposes; fix the rates for water; and acquire, construct, operate and maintain any and all works, facilities, improvements and property necessary or convenient to the exercise of the powers granted by the Act; WHEREAS, Tustin is a member public agency of MWDOC providing domestic water services primarily within MWDOC's service area; WHEREAS, EOCWD is a member public agency of MWDOC providing domestic water services primarily within MWDOC's service area; WHEREAS, OCWD is a groundwater management agency primarily in MWDOC's service area; WHEREAS, MWDOC, as a member public agency of Metropolitan under the ACT, is a wholesale purchaser within its service area of water developed, stored, and distributed by Metropolitan; WHEREAS, OCWD was created under a Special Act of the California Legislature in 1933 ("OCWD ACT") for the purpose of protecting and managing the Orange County Groundwater Basin. The OCWD Act specifically empowers OCWD to manage the groundwater basin; to provide for conservation of the basin (including both quantity and quality of water); and to provide protection of both the water rights of Orange County and of the natural flow of the Santa Ana River; WHEREAS, Metropolitan's water supply and demand projections for its service area, including that encompassed by MWDOC, show that additional sources of supplemental water must be developed to meet future needs; WHEREAS, Metropolitan has determined to take all necessary steps to provide its service area with adequate and reliable supplies of high quality water to meet expanding -2- and increasing needs in the years ahead in an environmentally and economically responsible way, including recovery of contaminated groundwater under its Groundwater Recovery Program; WHEREAS, certain portions of the Orange County Groundwater Basin (including areas within Tustin) contain significant concentrations of nitrates and total dissolved salts exceeding potable water standards thereby preventing its use as a domestic supply unless treatment is provided; WHEREAS, Tustin and OCWD have determined that it would be more costly to obtain a portion of its water supply by reclaiming groundwater from the Orange County Groundwater Basin than to purchase the equivalent amount of Metropolitan's Treated Noninterruptible Service from MWDOC; WHEREAS, Metropolitan, OCWD and MWDOC have determined that it is mutually beneficial for Tustin to increase its production from the Orange County Groundwater Basin by developing and operating a new treatment plant and appurtenant facilities as described by the summary and map attached hereto as Exhibit "A"; WHEREAS, Metropolitan in accordance with its Groundwater Recovery Program, desires to assist MWDOC, OCWD, EOCWD and Tustin in'the cost of recovering the contaminated groundwater which exceeds the cost of Treated Noninterruptible Service from Metropolitan; -3- WHEREAS, MWDOC, OCWD and Tustin desire to comply with the provisions of Metropolitan's Groundwater Recovery Program in return for Metropolitan's financial assistance; WHEREAS, the Tustin Desalter Project will increase groundwater production for domestic and municipal uses by producing up to approximately 31500 acre-feet per year (resulting in approximately 31200 acre-feet per year of potable water and 300 acre-feet per year of brine after treatment) from the Orange County Groundwater Basin; WHEREAS, Tustin has entered into an agreement with OCWD dated (Exhibit "F") related to certain financial arrangements and responsibilities regarding development and operation of a water treatment facility, and which provides for reimbursement of costs between Tustin and OCWD; WHEREAS, the terms of this Agreement do not set precedent for future agreements regarding Metropolitan's Groundwater Recovery Program; NOW, THEREFORE, in consideration of the promises and covenants hereinafter -set forth, the parties do agree as follows: Section 1 Definitions. The following words and terms, unless otherwise expressly defined in their context, shall be defined to mean: 1.1 "Allowable,Yield" shall mean the actual amount of Recovered Groundwater which Tustin delivers for domestic and municipal use in any given year, which is sold by Tustin to -4- Metropolitan pursuant to Section 10. Such Allowable Yield shall be considered to be local groundwater for purposes of Metropolitan shortage allocations; and shall be considered not to be local groundwater for the purpose of determining application of Metropolitan's Seasonal Storage Service rate. 1.2 "Agreement Purchase Price" shall mean the price per acre-foot Metropolitan pays Tustin for Allowable Yield. Agreement Purchase Price shall be the lesser of: (a) The summation of Project Unit Cost plus Deferred Cost; or (b) The summation of Treated Noninterruptible Water Rate plus Metropolitan's Maximum Financial Incentive Rate. Agreement Purchase Price shall not be less than the Treated Noninterruptible Water Rate. 1.3 "Annualized Capital Component" shall mean the annualized cost of design, construction and associated financing incurred by Tustin for each acre-foot of Recovered Groundwater pursuant to the criteria and limitations in Exhibit "B" incorporated herein by this reference. 1.4 "Annualized Replacement Component" shall mean the annualized cost incurred by Tustin of replacing specified Project equipment which has become nonfunctional through use, following the initiation of Project operation, pursuant to Exhibit "D" incorporated herein by this reference. -5- 1.5 "Contaminated Groundwater" shall mean groundwater which does not meet drinking water quality standards set forth in Division 41 Environmental Health of Title 22, California Code of Regulations. Regarding the secondary drinking water standards for mineral concentration in Table 7, Article 8 of Chapter 15 of that Division, groundwater must exceed the upper Maximum Contaminant Level to be considered contaminated. 1.6 "Deferred Cost" shall mean Project costs, which exceed Metropolitan's Treated Noninterruptible Water Rate plus Metropolitan's maximum Financial Incentive Rate in a Fiscal Year and are carried forward for inclusion in the calculation of Agreement Purchase Price for the following Fiscal Year, as a means of levelling Project expenses and Metropolitan contributions pursuant to the criteria and limitation in Exhibit "E" incorporated herein by this reference. 1.7 "Estimated Agreement Purchase Price" shall mean the estimated price per acre-foot Metropolitan pays to Tustin for Allowable Yield for monthly billing purposes. Estimated Agreement Purchase Price shall be calculated for each Fiscal Year as the lesser of: (a) Estimated Project Unit Cost; or (b) The summation of Treated Noninterruptible Water Rate plus Metropolitan's Maximum Financial Incentive Rate. 1.8 "Estimated Project Unit Cost".shall mean an estimation, for monthly billing purposes, of the cost to produce an acre-foot (AF) of water by the Project in a Fiscal Year (FY). The Estimated Project Unit Cost values for the initial Fiscal Years of operation are as follows: FY FY FY 93-94 94-95 95-96 AF AF AF • Annualized Capital Component 247 247 247 . operation and Maintenance Component 337 354 372 . Annualized Replacement Component 0 0 0 • Estimated Project Unit Cost 584 601 619 For subsequent Fiscal Years Metropolitan shall calculate Estimated Project Unit Cost by adjusting previously established actual Project Unit Cost values for inflation of the operation and Maintenance Component and for other cost projections by Tustin. The operating Committee shall resolve any disagreement regarding the calculation of Estimated Project Unit Cost. 1.9 "Fiscal Year" shall mean a Metropolitan fiscal year which begins on July 1 and ends on June 30. 1.10 "Groundwater Recovery Program" (hereinafter "GRP") shall mean the program adopted by Metropolitan's Board of Directors on April 9, 1991 and as amended thereafter, to provide financial assistance to member agencies and local water purveyors to recover and make beneficial use of Contaminated Groundwater within Metropolitan's service area. -7- W. 1.11 "Metropolitan's Maximum Financial Incentive Rate" shall not be less than $250 per acre-foot, a rate which may be increased in the future by Metropolitan's Board of Directors. 1.12 "Operating Committee" shall mean a committee composed of one participant each from Metropolitan, MWDOC, OCWD, and Tustin. The purpose of the Operating Committee is to resolve issues arising during the term of this Agreement as authorized under certain sections of this Agreement. Metropolitan will have a single vote on the committee, and the other parties (MWDOC, OCWD and Tustin) will collectively have a single vote. There shall be no fractional voting by MWDOC, OCWD and Tustin. The Operating Committee, to the extent possible; shall seek to establish a consensus on carrying out its responsibilities. If a consensus cannot be reached, a third party shall be mutually appointed to represent a third vote on the committee, and the Operating Committee shall then act by majority vote. Costs for third party participants shall be paid one-half by Metropolitan, and one-half collectively by OCWD and Tustin and shall not be included in Project Unit Cost. 1.13 "Operation and Maintenance Component" shall mean the average operation and maintenance cost incurred by Tustin for producing each acre-foot of Recovered Groundwater pursuant to the criteria and limitations in Exhibit "C" incorporated herein by this reference. 1.14 "Project" shall mean the Tustin Desalter Project being developed by OCWD and Tustin, to produce Recovered Groundwater. The Project is described in Exhibit "A" incorporated herein by this reference. year. 1.15 "Project Capacity" shall mean 3,200 acre-feet per 1.16 "Project Unit Cost" shall mean the actual cost to produce an acre-foot of water by the Project in a Fiscal Year and is comprised of three components: Annualized Capital Component, Operation and Maintenance Component and Annualized Replacement Component. 1.17 "Recovered Groundwater" shall mean all Contaminated Groundwater rendered potable by the Project. W... 1.18 "Treated Noninterruptible Water Rate" shall mean those amounts which are charged by Metropolitan pursuant to the discretionary rate -setting authority of its Board of Directors from time -to -time for its basic treated water service. Section 2: Warranties. 2.1 Tustin and OCWD warrant that the Project will increase the Orange County Groundwater Basin's production and increase water supply reliability. 2.2 Tustin warrants that it has a firm right to extract groundwater from the Orange County Groundwater Basin to operate the Project. 2.3 Tustin warrants that it is able to and has authority to distribute and sell Allowable Yield produced from the Project. 2.4 Tustin and OCWD warrant that neither they, nor any contractor or consultant performing work on Project, discriminates against employees or against applicant for employment because of ethnic group identification, religion, age, sex, color, national origin, or physical or mental disability. Section 3: Construction Responsibilities. OCWD shall be solely responsible for all design; environmental and other reporting requirements; right-of- way acquisitions; permits; construction of the Project and modifications thereof. OCWD and Tustin shall be mutually responsible for capital costs of the Project in accordance with their agreement referenced herein and attached as Exhibit "F". Section 4: Ownership of Facilities. Tustin or OCWD shall be the sole and exclusive owner of all Project facilities, or Tustin shall have certain lease interests as outlined in Tustin's agreement with OCWD which is referenced herein and attached as Exhibit "F". Metropolitan, MWDOC and EOCWD shall have no ownership right, title, security interest or other interest in any Project facilities, nor any rights, duties, or responsibilities for operation and maintenance thereof. The sole right and obligation of Metropolitan shall be in the form of an entitlement to -10- purchase the Allowable Yield generated by the Project and to sell the Allowable Yield as set forth in Section 11 hereof. Section 5: Operating Responsibilities. 5.1 Tustin shall be solely responsible for the operation and maintenance of all components of the Project. 5.2 Tustin agrees to provide for the proper operation, maintenance, replacement as necessary, inspection of Project facilities and distribution of Recovered Groundwater regularly and in accordance with all applicable federal, State and local laws, rules, regulations and guidelines for the term of this Agreement. 5.3 Tustin shall notify Metropolitan within 30 days of the initiation of the Project operation. Section 6: Interruption of Water Supply. 6.1 Tustin, OCWD, and MWDOC agree (to the extent that each has the authority) to diligently prepare for and maintain the Project during interruption of Metropolitan's replenishment deliveries pursuant to subsections 6.2 and 6.3. 6.2 During water shortage conditions, Metropolitan may suspend for up to three continuous years delivery to MWDOC of replenishment water equal to extracted groundwater that is required to support Project's Allowable Yield. 6.3 Subsequent to suspension of Metropolitan deliveries of replenishment water, Tustin, OCWD and MWDOC shall diligently replenish Orange County Groundwater Basin to sustain another three years of interruption of Metropolitan -11- replenishment water. Subject to the provisions of Metropolitan's policies and Administrative Code, Metropolitan shall make deliveries of replenishment water requested by MWDOC for OCWD's or Tustin's use in restoring groundwater storage. Section 7: Metering. OCWD shall provide metering devices for the purpose of accurately measuring the quantity of Recovered Groundwater; and Tustin shall meter water produced by the Project in a manner that adequately distinguishes Recovered Groundwater from any other water that it may manage. Tustin also shall provide electrical metering devices to accurately measure the energy used for the Project to determine incurred operation and maintenance costs. Tustin shall meter energy use in a manner that distinguishes Project use from other uses. Prior to the initiation of Project operation, Tustin shall present metering plans for water and energy for Metropolitan's approval. Metropolitan is not obligated to purchase any Allowable Yield until it has approved in writing Tustin's metering plans. Section 8: Record Keeping. 8.1 Tustin shall maintain and retain accounting records of all costs incurred for the construction, operation, and maintenance of the Project. Accounting for the Project shall utilize generally accepted accounting practices and be consistent with the terms of this Agreement. Tustin's Project accounting records must clearly distinguish all costs for the Project from Tustin's other water production, treatment and -12- distribution costs. Tustin's records also shall be adequate to determine Allowable Yield and Recovered Groundwater to accomplish all cost calculations contemplated in this Agreement. 8.2 Tustin shall on a Fiscal -Year basis collect Recovered Groundwater and Allowable Yield data and retain records of that data based on the metering plans described in Section 7. 8.3 Tustin shall maintain water quality records of the source groundwater and of the Project effluent pursuant to regulatory requirements. 8.4 Project Audits. (a) Metropolitan shall have the right to direct Tustin to have an independent audit of all Project costs incurred in any Fiscal Year pursuant to this Agreement. Tustin shall then have an audit performed by an independent certified public accounting firm and provide Metropolitan copies of the audit report within six months after the end of the Fiscal Year(s) for which the audit was requested. In no case will more than one independent audit per Fiscal Year be required. The cost of any independent audit performed under this Agreement shall be paid by Tustin and is an allowable Project operation and maintenance cost pursuant to Exhibit "C". Tustin shall reimburse Metropolitan's financial contributions pursuant to this Agreement, which are not required based on the results of the independent audits. -13- (b) Tustin and OCWD shall make available for inspection to Metropolitan and MWDOC, upon 30 days advance notice, all records, books and other documents, including all billings and costs incurred by contractors, relating to the construction, operation, and maintenance of the Project for a period of three years after the occurrence of any Project costs pursuant to the Agreement. Section 9: Project Cost and Agreement Purchase Price. 9.1 Project Cost shall be computed and revised annually pursuant to its definition in Subsection 1.16, using the following procedure: (a) Annualized Capital Component. Tustin shall establish its capital financing for the Project prior to the end of the first Fiscal Year of operation. Within 90 days of the end of the first Fiscal Year, Tustin shall provide Metropolitan with supporting documentation of its actual cost of capital for the Project pursuant'to the criteria in Exhibit "B". Metropolitan shall then calculate the Annualized Capital Component of Project Unit Cost for the applicable Fiscal Year. Tustin shall report to Metropolitan any changes in its capital financing during the term of this agreement. Only those changes in financing which lower the annual cost of capital shall be included in subsequent calculations of the Annualized Capital Component, pursuant to Exhibit "B". (b) Operation and Maintenance Component. Within 90 days of the end of the first Fiscal Year and of the end of -14- y every Fiscal Year thereafter of Project operation, Tustin shall provide Metropolitan supporting documentation of its actual operation and maintenance costs of the Project and flow records of Recovered Groundwater for previous Fiscal Year pursuant to the criteria in Exhibit "C". Metropolitan shall then calculate the Operation and Maintenance Component of Project Unit Cost for the applicable Fiscal Year. (c) Annualized Replacement Component. Within 90 days of the end of the first Fiscal Year and of the end of every Fiscal Year thereafter of Project operation, Tustin shall provide Metropolitan supporting documentation of its replacement costs of Project for the previous Fiscal Year pursuant to the criteria in Exhibit "D". Metropolitan shall then compute the Annualized Replacement Component of Project Unit Cost. (d) Disagreement between Metropolitan and Tustin regarding the eligible components and cost values constituting the Annualized Capital Component, Operation and Maintenance Component, and Annualized Replacement Component shall be resolved by the Operating Committee. 9.2 Suspension of Allowable Yield Purchase by Metropolitan. Metropolitan shall have the right to temporarily suspend its purchase of Allowable Yield from Tustin if Tustin fails to provide Project Unit Cost or water production data pursuant to the time requirements specified in Subsection 9.1. -15- 9.3 Calculation of Agreement Purchase Price and Deferred Cost. Within one year of the end of each Fiscal Year, Metropolitan shall calculate Agreement Purchase Price and Deferred Cost for that Fiscal Year, and those calculations shall then apply to all Allowable Yield sales to Metropolitan during the applicable Fiscal Year, pursuant to Subsection 10. 1(c) . Section 10: Purchase of Allowable Yield. 10.1 Purchase by Metropolitan. (a) Metropolitan agrees to purchase the Allowable Yield from Tustin, at the Agreement Purchase Price, subject to Section 7 and Subsections 8.2 and 8.4; however, initial payment on a monthly basis will be at the Estimated Agreement Purchase Price. (b) Metropolitan shall not be obligated to purchase in excess of 3840 acre-feet (120 percent of Project Capacity) of Recovered Groundwater in any one Fiscal Year, unless otherwise agreed in writing. (c) Annual Reconciliation. Within one year of the end of each Fiscal Year, Metropolitan shall calculate the difference between Agreement Purchase Price and the Estimated Agreement Purchase Price. An adjustment shall be computed by Metropolitan for over or under payment of Allowable Yield and reimbursement shall be paid by Metropolitan or Tustin as appropriate. Ci :M 10.2 Invoiced Allowable Yield. Tustin shall determine at the beginning of each month the quantity of Recovered Groundwater delivered to its customers during the preceding month and shall invoice Metropolitan monthly for that amount. At its sole discretion, Tustin may at any time choose to decline the sale of Allowable Yield to Metropolitan. Tustin shall obtain concurrence of OCWD prior to taking such action. 10.3 Payment by Metropolitan. Metropolitan shall pay Tustin for invoiced Recovered Groundwater within 45 days of receipt of Tustin's invoice. Payment shall be provided by check to Tustin. 10.4 Date of Sale. Invoiced Recovered Groundwater shall be deemed sold to Metropolitan as of the date of Metropolitan's payment to Tustin. Section 11: Resale to MWDOC, EOCWD, and Tustin. 11.1 Purchase by MWDOC. Metropolitan agrees to resell the Recovered Groundwater to MWDOC, simultaneously with Metropolitan's purchase of respective Allowable Yield from Tustin pursuant to Subsection 10.4. MWDOC agrees to purchase that Recovered Groundwater from Metropolitan at a rate equal to Metropolitan's then current Treated Noninterruptible Water Rate. Metropolitan shall bill MWDOC in accordance with the rules and regulations established from4time to time by Metropolitan as reflected in Metropolitan's Administrative Code. -17- 11.2 Purchase by EOCWD and Resale to Tustin. MWDOC agrees in turn to resell the Recovered Groundwater to EOCWD simultaneously with its purchase of that Recovered Groundwater from Metropolitan pursuant to Subsection 11.1. EOCWD agrees to purchase that Recovered Groundwater from MWDOC at a rate set forth by MWDOC. EOCWD agrees in turn to resell the Recovered Groundwater to Tustin simultaneously with its purchase of that Recovered Groundwater from MWDOC. TUSTIN agrees to pruchase that Allowable Yield from EOCWD at a rate set forth by EOCWD. 11.3 Payment Process. Upon receiving the Metropolitan billing, MWDOC shall pay Metropolitan according to the rules and regulations established from time to time by Metropolitan as reflected in Metropolitan's Administrative Code. Section 12: Proiect Water Rates. 12.1 The Board of Directors of Metropolitan shall set the Treated Noninterruptible Water Rate to be charged for the sale of Allowable Yield pursuant to this Agreement. These rates may be changed from time to time by said Board, pursuant to its water service regulations. 12.2 The Board of Directors of MWDOC shall set its water rate to be charged for the sale of Allowable Yield purchased from Metropolitan. These rates may be changed from time to time by said Board, pursuant to its water service regulations. 12.3 The Board of Directors of EOCWD shall set'its water rate to be charged for the sale of allowable Yield purchased from MWDOC. These rates may be changed from time to time by said Board, pursuant to its water service regulations. 12.4 The rates charged by Tustin shall be set at its discretion. Section 13: Term and Amendments. 13.1 The term of this Agreement shall be twenty (20) years from the date of the initiation of the Project operation. 13.2 This Agreement may be amended at any time by written mutual agreement of the parties. 13.3 Tustin may terminate this Agreement upon 30 days prior notice. Tustin shall obtain concurrence of OCWD prior to taking such action. 13.4 Metropolitan may terminate this Agreement upon 30 days prior notice, following any five -consecutive -year period subsequent to the initiation of Project operation during which no Allowable Yield is sold by Tustin to Metropolitan. Section 14: Insurance and Indemnity. Tustin shall maintain such insurance as will protect it from claims under worker's compensation acts, and such general liability insurance as will protect it from claims or damages for bodily injury, including death, and damage to property, which may arise out of ownership, construction, or operation of the Project. Tustin shall furnish Metropolitan -19- with a certificate of insurance using the attached form identified as part of Exhibit "G", which provides for a combined single limit of not less than one million dollars. An updated certificate shall be provided to Metropolitan whenever the insurance policy is renewed. If Tustin is self-insured it shall provide Metropolitan documentation of adequate coverage and method of funding. Tustin shall defend, indemnify, and hold Metropolitan, and Authority, their Boards, directors, officers, employees, and member agencies harmless from damage of any nature arising out of the operation of the Project by Tustin. Section 15: Notice. Any notice, payment or instrument required or permitted to be given hereunder shall be deemed received upon personal delivery or 24 hours after deposit in any United States post office, first class postage prepaid and addressed to the party for whom intended, as follows: If to Metropolitan: The Metropolitan Water District of Southern California Post Office Box 54153 Los Angeles, California 90054-0153 Attention: General Manager If to MWDOC: The Municipal Water District .of Orange County 10500 Ellis Avenue P.O. Box 20895 Fountain Valley, California 92728 Attention: General Manager -20- If to OCWD: Orange County Water District 10500 Ellis Avenue P.O. Box 8300 Fountain Valley, California 92728-8300 Attention: General Manager If to EOCWD East Orange County Water District 185 N. McPherson Road Orange, California 92669 Attention: General Manager If to Tustin: City of Tustin P.O. Box 466 Tustin, California 92680 Attention: City Manager Any party may change such address by notification given to the other party as provided in this section. Section 16: Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. This Agreement and any portion thereof shall not be assigned or transferred, nor shall any of the duties be delegated, without the express written consent of a_1 parties. Any attempt to assign or delegate this Agreemen- without the express written consent of all parties shall be void and of no force or effect. Section 17: Severabili:-v. The partial or total in.,,alidity of one or more sections of this Agreement shall not affect the validity of this Agreement. Section 18• Entire Agreement. This Agreement comprises the entire integrated understanding between the parties concerning the Tustin Desalter Project, and supersedes all prior negotiations, representations, or agreements. Section 19: Governing Law. The laws governing this Agreement shall be the Laws of the State of California. Section 20: Signatures. The individuals executing this Agreement represent and warrant that they have the right, power, legal capacity and authority to enter into and to execute this Agreement on behalf of the respective legal entities of the parties. IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date first hereinabove written. APPROVED AS TO FORM: THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA Fred Vendig Carl Boronkay General Counsel General Manager By: Deputy General Counsel APPROVED AS TO FORM Title: By: Assistant General Manager THE MUNICIPAL WATER DISTRICT OF ORANGE COUNTY sm Title: _22_ APPROVED AS TO FORM By. Title• APPROVED AS TO FORM By. Title: APPROVED AS TO FORM By. By. City Attorney City Clerk THE ORANGE COUNTY WATER DISTRICT By. Title • THE EAST ORANGE COUNTY WATER DISTRICT By: Title: THE CITY OF TUSTIN -23- Mayor Overview EXHIBIT "A" PROJECT DESCRIPTION Tustin Desalter Project OCWD will construct the Tustin Desalter Project consisting of a well, pipelines, and a water treatment facility in the North Tustin area of the Orange County Groundwater Basin. The project involves the extraction of groundwater which contains.high concentrations of total dissolved solids (TDS) and nitrates; treatment of the groundwater at.a central facility; conveyance of the product water to the local potable water system; and disposal of the facility's brine reject to the local sanitary sewer system, or dedicated brine line for ocean disposal. The project would treat and deliver over 3,000 acre-feet per year (AFY) of groundwater to the City of Tustin for domestic and municipal use. Project benefits include cleanup of the groundwater basin, protection of existing wells from future potential contamination, and development of a new reliable water supply. The 2 -MGD Desalter involves three existing groundwater wells and would employ a reverse osmosis (RO) desalination process and blending with untreated water. TDS levels would be reduce from about 1,500 milligrams per Liter (mg/L) down to 580 mg/L, while nitrate levels would be reduced from about 100 mg/L down to 42 mg/ L. Project Facilities The Tustin Desalter Project will require the construction of a 2 -MGD reverse osmosis desalination plant, a source well water collection system, brine disposal facilities, and product water blending and delivery facilities. The facilities are detailed below. Treatment Facilities Treatment facilities will consist of a reverse osmosis (RO) system, including a scale inhibitor and acid injection system, cartridge filters, a high pressure pump, RO membrane units, carbon dioxide removal, product water stabilization, chlorine disinfection, and pumping to the Tustin potable water system. Approximately 730 gallons per minute (gpm) of the influent flow with anticipated dissolved solids and nitrate concentrations of 1,560 mg/L and 100 mg/L, respectively, would be bypassed around the RO system, while 1,670 gpm would be treated. An estimated brine flow of 250 gpm from the RO system would be sent to the County Sanitation Districts of Orange County (CSDOC) wastewater treatment facilities via a trunk sewer. The product water would be blended with the bypass water, stabilized, disinfected and pumped to the Tustin water system at a water quality of about 580 mg/L TDS and 42 mg/L nitrate. The product water would meet all applicable standards for drinking water. -2- Wellhead Facilities The existing 17th Street Wells Nos. 1 and 2 are out of service. Well No. 1 was constructed about 1926, extensively rehabilitated in 1967, and removed from service in 1976 due to poor water quality. Well No. 2 was constructed in 1972, but never placed in service due to poor water quality. The Newport Avenue Well was drilled in 1923 and removed from service in 1976 due to poor water quality. The pumping equipment in 17th Street Well No. 1 and the Newport Well has been found to be obsolete and in a state of disrepair and has been removed. Table A-1 shows the various well capacities. Table A-1 Location Pumping Capacity, gpm Pressure after Filter, psi 17th Street No. 1 1,300 30 17th Street No. 2 450 30 Newport Well 800 30 Pipelines The 2 -MGD desalter would be located at the site of the 17th Street Wells. A 10" diameter 4,300 foot pipeline would be required to deliver water from the Newport Well to the plant. A pipeline will be required to bypass the R.O. process for blending well water with product water. An additional 12" diameter 1,300 -foot bypass -3- pipeline will be required to deliver plant product water to a local storm drain during start-up and testing. This pipeline is also required to deliver high sand and silt content water, which is typically produced by the wells for the first 30 minutes after start-up, to the storm drain. Table A-2 details the pipelines requirements. Table A-2 Description Size, inches Length, feet Well Water Collection 10 4,300 Product Water Delivery 12 30 Well Bypass/Process 10 30 Well Bypass/Storm Drain 12 11300 Pump Station Two 150 horsepower (hp) VFD booster pumps for the RO process would be required to increase pressure to the membrane from 30 pounds per square inch (psi) to 200-250 psi at a flow rate of approximately 1,670 gpm. A product.water delivery pumping system would also be required to deliver water to the Tustin Water System. Booster Pump The project will include a booster pump system to deliver product water to Tustin's service zones Nos. 1 and 2 as depicted in Figure A-2. -4- Points of Connection Project facility shall terminate at the points of connection to the existing distribution and sewer systems. -5- TZIS rIN POINT OF RE* CONNECTION 17TH ST. WEL WE CONNECTION 7 H TW W E L L E 1 T S/ G 17TH ST. 2 TO EXISTING 10 it DISTRIBUTION AND DESA R E SYSTEM SITE STREET PIPELINE IPELINE NEWPORT WELL SITE .. %.v a . — — — - - — — FIGURE 1 SANTA CL ARA AVE. 03 CC ti V, G K 94 Sq HTy 4&4 ZONE I HGL = 300 LEGEND 13 W 1— A VETA W 2— RBA STRE'E-f*," 3— TU IN AVENUE WELL 4— PROS CT AVENUE WELL (IA) 5— 17TH S ET WELL #1 ([A) 6— 17TH STR ET WELL #2 (IA) " COLUMBU. "TUSTIN WELL 8 E N ETA.:. ;'E L L 9—fVI.N Q -5-T- 0 N W E L L EW,�ORT AVENUE WELL (IA) 1.f,.,.MAIN STREET WELL #3 MAIN STREET WELL #2 PANKEY WELL 14 WALNUT WELL (IA) Inactive CITY OF TUSTIN EAST ORANGE COUNTY WATER DISTRICT TUSTIN WATER SERVICE . — — — — — PRESSURE ZONE BOUNDARY FIGURE 2 ZONES AND SERVICE AREA LOCATION MAP 17TH TR EET ccH. PROPOSED':':::-. LL VANDENBURG WELL Ca < 9 7 0 IRVINE BLVD. ......... . -. I ST STREET 12 A,* 11 MAIN sr 00 Sq HTy 4&4 ZONE I HGL = 300 LEGEND 13 W 1— A VETA W 2— RBA STRE'E-f*," 3— TU IN AVENUE WELL 4— PROS CT AVENUE WELL (IA) 5— 17TH S ET WELL #1 ([A) 6— 17TH STR ET WELL #2 (IA) " COLUMBU. "TUSTIN WELL 8 E N ETA.:. ;'E L L 9—fVI.N Q -5-T- 0 N W E L L EW,�ORT AVENUE WELL (IA) 1.f,.,.MAIN STREET WELL #3 MAIN STREET WELL #2 PANKEY WELL 14 WALNUT WELL (IA) Inactive CITY OF TUSTIN EAST ORANGE COUNTY WATER DISTRICT TUSTIN WATER SERVICE . — — — — — PRESSURE ZONE BOUNDARY FIGURE 2 ZONES AND SERVICE AREA LOCATION MAP EXHIBIT "B" COST FACTORS CONSTITUTING ANNUALIZED CAPITAL COMPONENT 1. The Annualized Capital Component shall be computed using incurred costs for the following: a. Consultant design services. b. Construction of Project as described in Exhibit "A". C. Supervision of design and construction, not to exceed three percent of construction costs, unless approved in writing by Metropolitan. d. Permits. . e. Initial Project start-up prior to the production of Allowable Yield. f. Land and right-of-way acquisitions required for the Project subsequent to December 14, 1991 (see Exhibit "A"). g. Brine Disposal Connection Fee. h. All contributions (except those derived from Metropolitan water management incentives), which are received by Tustin from others and offset the above listed eligible capital costs shall be treated as negative capital cost values for the purpose of computing the Annualized Capital Component. 2. Cost of the following items shall not be used to calculate the Annualized Capital Component: a. Distribution and storm drain systems beyond the Project's points of connection. b. Environmental planning, documentation and mitigation measures required to comply with the California Environmental Quality Act (CEQA). C. MWDOC's Project participation. d. EOCWD's Project participation. e. Land acquisition costs incurred prior to December 14, 1991. f. Existing water systems. g. All other items not specified in Section 1 of this Exhibit. -2- 3. Annualized Capital Cost (ACCost) of Project in dollars per year shall be computed using the following procedure: ACCost=[ ( (CRF) 1xPl)+( (CRF) 2xP2)+..+( (CRF) XXPX) ] Where: PX shall mean each increment of incurred capital cost for Project with a distinct financing arrangement. CRF is the capital recovery factor for each distinct financing arrangement, as follows: i[ (1+i)n] CRFX = i is the interest rate in decimal format* n is the period of amortization in years* x is the number of separate financing elements * Those capital costs not covered by a specific financing agreement shall be amortized using an interest rate of 8 percent for a period of 20 years. 4. The Annualized Capital Component (ACCom) in dollars W per acre-foot for purposes of determining the Project Unit -3- Cost each Fiscal Year shall be calculated using the following formula: Where: ACCom = [(ACCost) (D) ] / [ (365) (Q) ] Q is Recovered Groundwater for the Fiscal Year and may not be less than 2,800 acre-feet (80 percent of Project Capacity) unless otherwise approved in writing by Metropolitan; and D is the number of days, not to exceed 365, in a Fiscal Year following the initial start of operation, and prior to the termination of the Agreement. -4- EXHIBIT 11C11 OPERATION AND MAINTENANCE COMPONENT. 1. The Operation and Maintenance Component shall be computed using the incurred costs for the following: a. Consultant services for Project operation and maintenance including audit costs. b. Employee salary and corresponding overhead costs for the hours worked by Tustin's staff specifically pertaining to the operation and maintenance of the Project. Overhead costs are limited to Tustin's normal employee benefits plus its general costs of conducting business which are assessed uniformly to the salary of its work force for comparable services. overhead rates exceeding 65 percent must be approved by the Operating Committee. C. Chemicals and supplies for Project operation and maintenance. d. Electrical energy for: i. Supply wells (3 each). ii. Project lighting and general electric needs. iii. Booster pumps No. 1, 21 3 and 4. Energy costs to pump Recovered Groundwater from Project to Service Zones No -1 and 2. Supporting data shall be provided indicating the energy utilized to deliver Recovered Groundwater to Service Zones No. 1 and 2. The energy amounts utilized shall be reasonable and practical regarding said delivery. Electrical energy for booster pumping shall not exceed 360 kilowatt-hours for each acre-foot of Recovered Groundwater. _._ iv. Brine disposal pumping. e. Contractor services and supplies for Project operation, maintenance and repair to maintain reliable system operation and achieve regulatory compliance. f. Water quality sampling and analysis for the Project. g. OCWD Replenishment Assessment charges applied to all groundwater pumped for Project operation. The Replenishment Assessment shall be a uniform rate applied to all other groundwater production in the OCWD jurisdiction. -2- h. Brine Disposal User Fee. i. All contributions (except those derived from Metropolitan water management incentives) which are received by Tustin from others and offset the above listed eligible costs shall be treated as negative values for the purpose of computing Operation and Maintenance Component. j. Replacement parts which are less than or equal to $100,000 per unit. k. Project insurance. 2. Costs of the following items shall not be used to calculate the Operation and Maintenance Component: a. Operation and maintenance of distribution, sewer and storm drain systems beyond the Project's points of connection. b. MWDOC's project participation. C. EOCWD's project participation. d. Replacement parts pursuant to Exhibit "D". -3- e. All others operation and maintenance items not specified in Section 1 of this Exhibit. 3. The Operation and Maintenance Component (O&MC) in dollars per acre-foot for purposes of determining the actual Project Unit Cost each Fiscal Year shall be calculated using the following formula: (O&MC) = (Actual Annual Cost of O&M)/(Recovered Groundwater) -4- EXHIBIT "D" ANNUALIZED REPLACEMENT COMPONENT I. The Annualized Replacement Component shall be computed • using incurred costs for the following: , a. Membrane replacement. b. Replacement of major Project parts exceeding $100,000 per unit, including existing components described in Exhibit "A". C. All contributions (except those derived from Metropolitan water management incentives) which are received by Tustin from others and offset listed eligible costs shall be treated as negative replacement values for the purpose of computing Annualized Replacement Component. d. Salvage of replaced part treated as a negative replacement. 2. Cost of the following items shall not be used to calculate the Annualized Replacement Component: a. Replacement of distribution or storm drain systems beyond the Project's point of connection. b. MWDOC's project participation. C. EOCWD'S project participation. d. Any capital, operation and maintenance, as previously defined in Exhibits "B" and "C". 3. The Annualized Replacement Cost (ARCost) regarding each replacement occurrence defined in this Exhibit "D" shall be calculated using the following procedure: Where: ARCost = .(CRF) (M) + (0.10185) (R) M is the incurred membrane replacement cost pursuant this Exhibit "D", applied to the period starting with the Fiscal Year in which the replaced membranes become operational through the period ending n Fiscal Years later. The value (0.10185) is the capital recovery factor used to amortize incurred replacement costs over 20 years using an 8 percent interest. R is the summation of all costs of replacing major parts other than membranes, incurred through the term of the Agreement. -2- CRF is the capital recovery factor corresponding to a n -year period at 8 percent interest as shown in the following table, where n is the number of years the replaced membranes were in service: n (Years) CRF 1 1.08000 2 0.56077 3 0.38803 4 0.30192 5 0.25046 6 0.21634 7 0.19207 8 0.17401 9 0.16008 10 0.14903 11 0.14008 12 0.13270 13 0.12652 14 0.12130 15 0.11683 16 0.11298 17 0.10963 18 0.10670 19 0.10413 20 0.10185 4. The Annualized Replacement Component (ARCom) for each replacement occurrence in dollars per acre-foot shall be calculated using the following procedure: ARCom = ARCost/Q Where: Q is measured Recovered Groundwater for the Fiscal Year and shall not be less than 2,560 acre-feet (80 percent of Project Capacity) unless otherwise approved in writing by Metropolitan. -3- EXHIBIT 'Ell Deferred Cost (DC) applicable to the determination of Agreement Purchase Price for the next Fiscal Year is computed as follows: DC = (EPC) / (Recovered Groundwater) Where: 1. EPC is the Excess Project Cost incurred in a Fiscal Year, and it is calculated using the following formula: EPC = [(Project Unit Cost) - (Treated Noninterruptible Water Rate Plus Metropolitan's Maximum Financial Incentive Rate)] x (Allowable Yield) The EPC value shall be used only in the calculation of DC for the next Fiscal Year and shall be considered zero thereafter. 2. The Recovered Groundwater term is the Project water produced in that next Fiscal Year. EXHIBIT "F" AGREEMENT BETWEEN CITY OF TUSTIN AND OCWD .k AGREEMENT BETWEEN ORANGE COUNTY WATER DISTRICT AND CITY OF TUSTIN FOR THE CONSTRUCTION, OPERATION AND ACQUISITION OF A GROUNDWATER DESALTER PROJECT THIS AGREEMENT is entered into as of February 18, 1992 by and between the ORANGE COUNTY WATER DISTRICT, a special governmental district organized and existing pursuant to the Orange County Water District Act, . Chapter 924, Stats. 1933, as amended (hereinafter referred to as "OCWD"), and the CITY OF TUSTIN, a municipal corporation organized and existing pursuant to the laws of the State -of California (hereinafter referred to as "Tustin"). RECITALS A. Two-thirds of all drinking water currently used within the Orange County coastal plain is provided from groundwater. Recent surveys of existing groundwater quality have indicated an ever-increasing concentration of nitrates and total dissolved solids ("TDS") in those waters used for municipal supply-. Inasmuch as Orange County is located in a semi- arid area, it is essential that all reasonable efforts be put forth to protect the quality of groundwater supplies and to provide for maximum utilization of that resource. B. The United States Environmental Protection Agency (hereinafter, "USEPA") and the State of California Department of Health Services (hereinafter, "DOHS") have adopted primary drinking water standards for nitrate, and secondary drinking water standards for TDS. Water containing nitrate concentrations in excess of 45 mg/1, or TDS concentrations in excess of 1,000 mg/I, have been determined by USEPA and DOHS not to be suitable for municipal or domestic purposes. 1 STAR No. F.S S/ octan DO©. �i-. - /j -) to C. Tustin operates a water system for the purpose of delivering potable water to its customers, and obtains most of its water by pumping groundwater from wells for delivery to its customers. Tustin has lost the use of some of its groundwater wells due to the presence of nitrates and TDS in quantities exceeding USEPA and DOHS drinking water standards. In particular, Tustin has lost the use of the "17th Street Well No. 1," the "17th Street Well No. 2," and the "Newport Well." Groundwater wells are hereinafter referred to as the "Project Wells." D. The Legislature of the State of California has vested in OCWD the statutory responsibility to manage, regulate, replenish, and protect the quality of subterranean groundwater supplies within the boundaries of OCWD. E. OCWD and Tustin are currently participating in a joint project relating to the construction and operation of a nitrate removal facility on two Tustin -owned groundwater wells other than the Project Wells. Preliminary results from that facility indicate that it is feasible and cost-effective to remove nitrates and TDS from contaminated groundwater for municipal supply purposes. F. OCWD and Tustin desire to install a desalination treatment plant on either or all of the existing Project Wells, or a new well or well(s) to be constructed within the service area of Tustin. The preliminary cost of the design and construction of such a desalination treatment plant is Five Million Four Hundred Thousand Dollars ($5,400,000). A more accurate determination of the cost cannot be determined until the completion of preliminary project design of the facility. Pil G. The parties are hopeful that the project facilities will be eligible for participation in the groundwater recovery program of the Metropolitan Water District of Southern California. If found to be eligible, OCWD or Tustin would receive incentives from MWD for production from the project facilities that would reduce the net cost per acre foot for water produced from the wells. H. In an attempt to mitigate the water quality problems created by nitrates and TDS in increasing concentrations throughout many areas of the Orange County groundwater basin, OCWD and Tustin desire to enter into this Agreement for the design, construction and operation of a desalination treatment facility for the purpose of removing nitrates and TDS from groundwater in order to meet USEPA and DOHS drinking water standards for the use of that water for municipal and domestic purposes. EXECUTORY AGREEMENTS NOW, THEREFORE, in consideration of the facts recited above and the covenants, conditions and promises contained herein, the parties hereto hereby agree as follows: SECTION ONE: DESIGN OF PROTECT FACILITIES. OCWD shall design the Project Facilities or cause such design to be prepared by contract, for the construction of facilities to remove nitrate and TDS from the groundwater produced by either or all Project Wells, or a new well or wells to be constructed in the vicinity of the Project Wells, as shown on the plan attached hereto as Exhibit "A" (such facilities are hereinafter referred to as the "Project Facilities"). The Project Facilities shall be designed as follows: (a) Nature of Facilities. The Project Facilities shall comprise facilities to remove nitrate and TDS from groundwater by means of a desalination process. The specific 3 desalination process to be installed in the Project Facilities shall be mutually determined by OCWD and Tustin either during the course of the preparation of the design or following receipt of construction bid proposals. The Project Facilities design may provide for alternative desalination process bid proposals. (b) Designation of Consultant. If OCWD determines to retain the services of any . consultant for the pre -design and design of the Project Facilities, OCWD and Tustin shall jointly agree upon any such consultant prior to the retention of the consultant. (c) OCWD to Furnish a Pre -Design Report and Cost Estimate to Tustin. OCWD shall prepare a Pre -Design Report and Cost Estimate. Upon completion, OCWD shall furnish Tustin three (3) copies of the Pre -Design Report and Cost Estimate for the Project Facilities for review and comment by Tustin. Tustin shall have thirty (30) days from the date of receipt of the Pre -Design Report and Cost Estimate to submit advisory comments and recommendations to OCWD regarding the design. (d) OCWD to Furnish Design for Review to Tustin. If Tustin does not terminate the Agreement based on the Pre -Design Report and Cost Estimate pursuant to Section Two, Subsection (b) below, OCWD shall proceed witli design. Upon completion of design, OCWD shall furnish to Tustin three (3) copies of the design for. review and comment by Tustin. Tustin shall have thirty (30) days from the date of receipt of design to submit advisory comments and recommendations to OCWD regarding the design. (e) Transmittal of Approved Design. Upon approval of the Project Facilities design by its Board of Directors, OCWD shall transmit to Tustin copies of the approved design for the Project Facilities. 4 (f) Exceptions OCWD Responsible for Design Cost. Except as hereinafter provided, OCWD shall be responsible for all costs incurred in the preparation of the pre - design and design for the Project Facilities. SECTION TWO: TERMINATION OF AGREEMENT AT CRITICAL STAGES. Either Tustin or OCWD may terminate this Agreement by giving written notice to the other party within thirty (30) days of any of the following events: (a) Receipt by Tustin from OCWD of a copy of a Notice of Determination based upon completion of environmental documentation (EIR or Negative Declaration) for the Project. If terminated at this stage, OCWD shall pay for all costs. (b) Receipt by Tustin from OCWD of a copy of the Pre -Design Report and Cost Estimate. If terminated at this stage, Tustin shall pay 50% of the cost of the Pre -Design Report and Cost Estimate to OCWD within thirty (30) days of receipt by Tustin from OCWD of a statement setting forth such costs. (c) Receipt by Tustin from OCWD of copies of the construction bids. If terminated at this point, Tustin shall pay 50% of the Pre -Design and Design Costs to OCWD within thirty (30) days of receipt by Tustin from OCWD of a statement setting forth such costs. (d) Receipt by Tustin from OCWD of Notice that Metropolitan Water District has denied funding under its Groundwater Recovery Program. If terminated at this stage, Tustin shall pay 50% of the Pre -Design and Design Costs to OCWD within thirty (30) days of receipt by Tustin from OCWD of a statement setting forth such costs. E SECTION THREE: CONSTRUCTION OF PROTECT FACILITIES. Within a reasonable time following approval of the Project Facilities design by OCWD, OCWD shall advertise for bids, and award a contract or contracts, for the construction and installation of the Project Facilities. OCWD shall make all reasonable efforts to award such construction contract(s) within one (1) year of the date of this Agreement. The construction of the Project Facilities shall be subject to the following terms and conditions: (a) OCWD to be Lead Agency. OCWD shall be the lead agency and the contracting party for the construction of the Project Facilities, and shall be solely responsible for obtaining all permits, licenses and approvals, if any, necessary for the construction of the Project Facilities, and for compliance with the California Environmental Quality Act, Public Resources Code Section 21000, etetc .., with respect to the construction and operation of the Project Facilities. Except for payments for the lease and possible acquisition of the project facilities by Tustin, as hereinafter provided in this Agreement, OCWD shall be responsible for all costs incurred in the construction of the Project Facilities. (b) Tustin to Provide Easement Rights on Land Owned by Tustin. Tustin shall provide OCWD with easement rights over the site of the Project Facilities, on Tustin -owned property, together with access thereto from public rights-of-way, for the construction, operation and maintenance of the Project Facilities. (c) OCWD to Acquire Adjacent Parcel. OCWD shall attempt to acquire title to the parcel adjacent to the parcel owned by Tustin. If acquired, this parcel shall be included as part of the Project Facilities. The purchase price shall be subject to the approval of Tustin. 6 (d) Tustin to have Access to Observe. At all times during construction of the Project Facilities, OCWD shall permit authorized representatives of Tustin access to the construction site to observe the construction of the Project Facilities. (e) QCWD to Require Insurance. OCWD shall require all contractors involved in the construction of -the Project Facilities to obtain liability insurance, builders all-risk insurance, and workers' compensation insurance. OCWD and Tustin, together with their respective officers, employees, and representatives, shall, be named as additional insureds on each such policy of insurance. OCWD shall require that each contractor involved in the construction of the Project Facilities shall provide liability insurance coverage in an amount not less than Three Million Dollars ($3,000,000) per occurrence, and furnish certificates evidencing such insurance to both OCWD and Tustin. (f) Notice of Completion and Statement of Costs. Within ninety (90) days of the completion of construction of the Project Facilities and their acceptance by the Board of Directors of OCWD, OCWD shall transmit to Tustin a notice of the completion of the Project Facilities (hereinafter referred to as the "Project Facilities Completion Notice"), together with a certified statement of the total costs paid by OCWD for the pre -design, the design, and the construction and installation of the Project Facilities, including all costs paid to consultants and contractors, all permit and engineering costs, and all other actual and direct costs incurred by OCWD with respect to the design and construction of the Project Facilities, but excluding all costs attributed to work or services performed by employees of OCWD. Such statement shall also include the cost of the adjacent parcel if acquired by OCWD. Such statement of the amount of the total costs paid by OCWD for the design and 7 construction of the Project Facilities is hereinafter referred to as the "Total Project Cost Statement." The Total Project Cost Statement shall serve as the basis for all amounts to be paid by Tustin to OCWD for the lease and acquisition by Tustin of the Project Facilities pursuant to Sections Four, Five -and Six below. SECTION FOUR:. LEASE OF PROJECT FACILITIES. Upon the issuance of the Project Facilities Completion Notice pursuant to Section Three above, OCWD shall lease its interest in the Project Facilities to Tustin. The terms and conditions of the Project Facilities Lease shall be as follows: (a) Term of Lease. The term of the Project Facilities Lease shall commence as of the date of the Project Facilities Completion Notice prepared pursuant to Subsection (e) of Section Three above, and shall continue for a period of eleven (11) years thereafter, unless terminated in accordance with Subsection (b) of this section hereinbelow. (b) Termination of Lease. The term of the Project Facilities Lease shall terminate upon the earliest of any of the following events: (i) The exercise by Tustin of its option to acquire the interest of OCWD in the Project Facilities pursuant to the provisions of Section Six below; or (ii) A default by Tustin of its duties and obligations under the Project Facilities Lease; or (iii) The expiration of the term of the Lease as set forth in Subsection (a) of this Section. (c) Title to Facilities. During the term of the Project Facilities Lease, title to the Project Facilities including the adjacent parcel if purchased by OCWD, and any and all 8 additions which comprise fixtures, repairs, replacements or modifications thereto, shall remain in the name of OCWD. Notwithstanding the foregoing, for and during the term of the Project Facilities Lease, Tustin shall have possession and use of the Project Facilities, and shall operate, maintain and repair the Project Facilities in accordance with the provisions of this Section. (d) Tustin to Operate Facilities. Tustin shall, under the supervision of OCWD, be responsible for the operation and maintenance of the Project Facilities throughout the term of the Project Facilities Lease. (e) OCWD to Provide Supervision and Support. During the term of the Project Facilities Lease, OCWD shall provide supervision and technical, engineering and analytical support at no cost to Tustin with regard to the operation and maintenance of the Project Facilities. In this regard, OCWD shall monitor the operation of the Project Facilities and conduct periodic analyses of the water treated by the Project Facilities. (f) Tustin to Obtain Permits and Approvals. Tustin shall be responsible for obtaining any and all permits and approvals required for the operation of the Project Facilities during the term of the Project Facilities Lease, including but not limited. to a sewage discharge permit from the County Sanitation Districts of Orange County, air emissions permit from the South Coast Air Quality Management District and a domestic water supply use permit from DOHS. OCWD shall assist Tustin in obtaining such permits and approvals. (g) Tustin to Meet Operation and Maintenance Standards. Tustin shall, at all times during the term of the Project Facilities Lease, operate and maintain the Project E Facilities in accordance with generally accepted maintenance and operation principles. Tustin further shall, at all times during the term of the Project Facilities Lease, provide personnel sufficient in numbers and qualifications to operate and maintain the Project Facilities. (h) Tustin Responsible for 0.& M Costs. Tustin shall be responsible for all costs incurred in the operation and maintenance of the Project Facilities during the term of the Project Facilities Lease, including but not limited to labor, materials and electrical energy (such costs are hereinafter referred to as the "Project O & M Costs"). (i) Tustin to Submit Annual Project Cost Statement. Tustin shall prepare an Annual Project Cost Statement which itemizes for the previous year: (1) all Project Operations and Maintenance Costs; (2) all lease payments paid to OCWD; (3) the value of any MWD subsidies received by Tustin, and (4) plant production in acre feet. Such statement shall be submitted to OCWD no later than thirty (30) days after the close of the year. Such statement shall be subject to audit by OCWD. (j) Tustin to Provide Insurance or Evidence of Self Insurance. If Tustin is not self insured, it shall take out and maintain in effect comprehensive general liability insurance in an amount not less than One Million Dollars ($1,000,000) per occurrence, for bodily injury, death and property damage, naming OCWD as an additional insured under such policy. Tustin shall also take out and maintain at all times during the term of the Project Facilities Lease property casualty insurance (including coverage against damage to or loss of the Project Facilities by reason of fire, smoke, lightning, flooding, vandalism, malicious mischief and explosion) in an amount equal to the amount set forth in the Total 10 Project Cost Statement prepared pursuant to Subsection (e) of Section Three above, which policy shall provide that all proceeds thereunder shall be payable to OCWD. Such insurance coverages may be maintained as part of or in conjunction with any other liability and property casualty insurance carried by Tustin. Evidence of self insurance or a certificate of insurance evidencing the coverages and endorsements as required herein, shall be furnished to OCWD upon the commencement of the Project Facilities Lease term, and shall be maintained throughout the term of the Project Facilities Lease. If Tustin is, or may become, partially or fully self-insured for its public liabilities, a letter executed by the mayor or city manager, stating Tustin's self-insured status and acknowledging its responsibility to respond to the indemnification of OCWD as provided in Subsection (c) of Section Eight, below, shall be furnished in lieu of the certificate of insurance. Tustin shall provide written notice to OCWD of any change in Tustin's insured or self-insured status during the term of the Project Facilities Lease within thirty (30) days of the effective date of such change. (k) Right of OCVWD to Observe. OCWD shall have the right to enter upon and observe the Project Facilities at all times during the term of the Project Facilities Lease upon twenty-four (24) hours written, verbal or telephonic notice to Tustin. SECTION FIVE: Rent. (a) For and in consideration of its lease of the Project Facilities, Tustin shall pay an annual rental to OCWD for the lease of the Project Facilities which shall be due on the dates and equal to the amounts sho«,n on Exhibit "B" which is attached hereto and incorporated herein by reference. In no event shall the net amount that Tustin pays per acre-foot of water produced from the Project Facilities, including rent and operations and 11 maintenance costs, less any MWD Groundwater Recovery Program incentives paid directly to Tustin, exceed the East Orange County Water District (EOCWD) treated, non - interruptible rate for water that would otherwise be delivered to Tustin. In the event that the net amount per acre-foot paid by Tustin for the previous year is greater than the EOCWD's treated, non -interruptible rate per acre foot of water produced, OCWD, shall pay. Tustin the difference between such amounts within sixty (60) days of receipt of Tustin's Annual Project Cost Statement. In the event Tustin does not exercise its option to purchase the Project Facilities prior to or at the termination of the lease, such amounts paid to Tustin less the value of any MWD Groundwater Recovery Program incentives received by OCWD (net payments), shall be reimbursed back to OCWD in years subsequent to the lease period when the sum of Tustin's O & M costs are less than the prevailing EOCWD rate. At such time, Tustin shall reimburse to OCWD all net payments received from OCWD plus accrued interest at seven percent (7%) per annum by paying OCWD the difference between the O & M project cost and the prevailing EOCWD rate multiplied by the project production in acre feet. (b) The Exhibit "B" that is attached to this Agreement is based upon an estimated total cost of Five Million Five Hundred Twenty -Five Thousand Dollars ($5,525,000), an interest rate of 7%, and an eleven -year lease/option period. In the event the actual costs are different, Exhibit "B" shall be amended accordingly with the written consent of both parties which shall not be unreasonably denied. (c) Each rental pavment under the Project Facilities Lease shall be paid in lawful money of the United States to or upon the order of OCWD. Any such rental payment 12 which shall not be paid when due shall bear interest at the rate of one percent (1%) per month (or the maximum legal interest rate, whichever is less) for each month or portion thereof that the rental payment remains delinquent. Notwithstanding any dispute between Tustin and OCWD, Tustin shall make all rental payments when due and shall not withhold any rental payments pending the final resolution of such dispute, and Tustin shall not assert any right of set-off or counterclaim against its obligation to make any rental payment under the Project Facilities Lease. SECTION SIX: ACQUISITION OF FACILITIES BY TUSTIN. Tustin shall choose one of two ways to acquire OCWD's interest in the Project Facilities. First, Tustin may exercise its option to acquire all of OCWD's interest in the Project Facilities at any time prior to or at the conclusion of the term of the Lease, provided that Tustin is not in default __. under any of the terms or conditions of the Lease. Such option shall be exercised by transmitting written notice of such exercise and enclosing with such notice payment to OCWD of the amount shown on Exhibit "B," as amended, for exercising the option at the time that payment is made, plus the sum of any net payments made to Tustin by OCWD pursuant to Subsection (a) of Section Five, above, with interest at 7% per annum until paid. Upon receipt and acknowledgment of such notice and payment, the Lease shall terminate, all of OCWD's interest in and to the Project Facilities shall be deemed assigned to and acquired by Tustin, and OCWD shall execute such instruments as may be reasonably requested by Tustin to document such assignment and acquisition. Second, Tustin may complete all lease payments plus pay the sum of any net payments made previously to Tustin by OCWD pursuant to Subsection (a) of Section Five, above, with interest at 7% per 13 annum until paid. Upon receipt by OCWD of such payments, all of OCWD's interest in and to the Project Facilities shall be deemed assigned to and acquired by Tustin, and OCWD shall execute such instruments as may be reasonably requested by Tustin to document such assignment and acquisition. SECTION SEVEN: TUSTIN TO OPERATE AT FULL CAPACITY. Tustin shall operate the Project Facilities at full capacity at all times. However, "full capacity" does not mean continuous operation. "Full capacity" will be variable depending on water conditions and down time for repairs and maintenance. SECTION EIGHT: MISCELLANEOUS. (a) Petition for Exemption of Basin Equity Assessments: The parties understand and agree that upon the execution of this Agreement, Tustin intends to file a petition with OCWD pursuant to Section 38.1 of the Orange County Water District Act to exempt the groundwater treated by the Project Facilities from the payment of the basin equity assessments imposed by OCWD pursuant to Section 31.5 of the OCWD Act. OCWD hereby agrees to process, consider and act upon such petition in an expeditious and timely manner. (b) Notices: 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 follows: 14 If to OCWD: Orange County Water District 10500 Ellis Avenue P.O. Box 8300 Fountain Valley, California 92728-8300 Attn: William R. Mills, Jr., General Manager If to Tustin: City of Tustin 300 Centennial Way Tustin, California 92680 Attn: William Huston, City Manager Or such other address or person as either party may direct in writing to the other. Service of any instrument or document given by mail shall be deemed complete upon receipt if delivered personally or by registered or certified mail, return receipt requested, 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 hereinabove. (c) Indemnification (i) To the extent permitted by law, OCWD shall indemnify and hold Tustin, together with its officers, councilmembers, employees and representatives, harmless from and against any damages or injury to the person or property of any person not a party hereto, including consequential damages, caused by OCWD's negligent performance of this Agreement or any negligent act or omission of OCWD undertaken in the performance of this Agreement. (ii) To the extent permitted by law, Tustin shall indemnify and hold OCWD, together with its officers, directors, employees and representatives, harmless from and against any damages or injury to the person or property of any person not a party 15 hereto, including consequential damages, caused by Tustids negligent performance of this Agreement or any negligent act or omission of Tustin undertaken in the performance of this Agreement. (d) Successors and Assigns: All of the terms, conditions and provisions of this Agreement shall inure to the benefit of, and be binding upon, OCWD, Tustin, and their respective successors and assigns. (e) N!2 Implied Waivers: In the event that any term, condition or provision of this Agreement should be breached by either party and thereafter waived by the other party, such waiver shall be limited to the specific breach so waived, and shall not be deemed either to be a continual waiver or to waive any other breach hereunder. (f) Integration, ation, Construction and Amendment: This Agreement represents the entire understanding of OCWD and Tustin as to those matters contained herein. No prior oral or written understanding shall be of any force or effect with respect to those matters covered by this Agreement. This Agreement shall be governed by the laws of the State of California and construed as if drafted by both OCWD and Tustin. This Agreement may be modified, altered or amended by a written amendment signed by both parties. IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above. APPROVED AS TO FORM: By: '-, A General Counsel, Orange County Water District 16 ORANGE COYMY WATER DISTRICT By:— President By General ar6ger APPROVED AS TO FORM: By: City At ney, K 4 City of Tustin AT TEST: By: '),A -C - -.-.. City Clerk 0 Q c:\documcnt\agmts\ag10091a.1us 17 CITY OF TU TIN By:mL Mayor oZ w N J Q LL U W O Q a I� UL � O Z X � c1c W a a z w a z w z a w Z Z L= J w CL Q a H N z c� Q LU z i LU a a w > J F J z Q r - Q z w z t� Fw ZZ Q J �a Qa Project Capital Cost: Interest Rate: Annual Lease Payment: Begin Lease Payment: Fully Amortized By: EXHIBIT "B" ORANGE COUNTY WATER DISTRICT LEASE PAYOUT SCHEDULE TUSTIN DESALTER PROJECT CITY OF TUSTIN 55,525,000 7.00% 1736,797 07/01/93 06/30/04 Prepared by: Laura Li Oct. 3, 1991 Due Annual Lease Period ----------------- Date ------------ Payout -------------- Principal ---------------- Interest -------------- Payment 07/01/93-06/30/94 06/30/94 $5,525,000.00 53500046.90 1386,750.00 -------------- $7368796.90 07/01/94-06/30/95 06/30/95 55,174,953.10 $374,550.18 5362,246.72 5736,796.90 07/01/95-06/30/96 06/30/96 54,800,402.92 5400,768.69 5336,028.20 $7360796.90 07/01/96-06/30/97 06/30/97 54,399,634.22 5428,822.50 5307,974.40 5736,796.90 07/01/97-06/30/98 06/30/98 $3,970,811.72 5458,840.08 5277,956.82 5736,796.90 07/01/98-06/30/99 06/30/99 $3,511,971.64 5490,958.88 5245,838.01 5736,796.90 07/01/99-06/30/00 06/30/00 53,021,012.76 55250326.01 5211,470.89 5736,796.90 07/01/00-06/30/01 06/30/01 52,495,686.75 5562,098.83 5174,698.07 5736,796.90 07/01/01-06/30/02 06/30/02 51,933,587.92 5601,445.74 $135,351.15 5736,796.90 07/01/02-06/30/03 06/30/03 $1,332,142.18 5643,546.95 593,249.95 5736,796.90 07/01/03-06/30/04 06/30/04 5688,595.23 5688,595.23 ---------------- 548,201.67 -------------- 57360796.90 -------------- -5,525,000.00 52,579,765.89 58,104,765.89 Prepared by: Laura Li Oct. 3, 1991 EXHIBIT "G" CERTIFICATE OF INSURANCE Kurt"K 1 r . DKI VCK HJJUI. 1L • ( 14- ACORI). CERTIFICI OF INSURANCE sawr DAn"ummwyj _... 09/30/92 r"PUG" THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE ROBERT F. DR7VER ASSOCIATES DOES NOT AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY TILE 3636 RTRCA STREET, #230 ELOW�-- NEWPORT BEAC-U r CA 92660 COMPANIES AFFORDING COVERAGE (714) 756-0271LLTM compAA A SEE ATTACHI� ENT *A0 COMPANY B LETTER 'I U"IbRANGE COUNTY CITIES RISK MANAGEMENT AUTHORITY AND MEMBER COmPAw C LETM AGENCY OF: CITY OF TUST IN Im�N Y D 15222 DET. AMO TUSTIN, CA 92660 i�AYE COVERAGE$ THIS 18 TO CERTIFY THAT THE POLICIR9 OP INSUIIANCC L1=0 DCLOW I IAVC BEEN ISSUCD TO THE INSURED NAMED ABOVE FOR THE POLICY PEFtIOI) INDICATCO. NOTWITHSTANDING ANY REOUIREMENT. TEAM OR CONDITION OF ANY CONI hACI OR OTMfN OOCUMFNT WITH RC>SPECT TO WINCH THIS CERTIFICATE MAY BE LR3UED OR MAY PFAIAIN. AHF INSURANCtF AFFORDED BY THE POLICIES DESCRIBED HEREIN iS SUBJECT TO ALL THE TEnUS, rXCI USIONS ANn CONMTIONS OF SUCH POLICIES. UMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. CO' TYPE Of INSVIIANCE POLICY NUMBER POLICY ERECT111E POLICY EXPIRATION LIMIT( LTR DATE /MMAXXM DATE IMMIDaYY) _ GENERAL LIABILITY ; GENERAL Al#KIRE(IATE i COIiMCMAL OCNCAAL UADIUI V ' MIOOLICTIi-0OMP/OP AOa. i CI AIMS MAI11i . OCOUIe. , PEnSONAL • ADV. wJUnY i OWNER% a OONTRACTOR'd PROT.: ; CAdI OCCIJRRCNCx ; t FIRE DAMAGE (Any wo Ilro) t i_ :MRs. Y><I'F•'N9f ( ons MraoM i AUTOMOBILE LIABILITY i COMRMIFn $"I F i LIAAI'1 . t ANY AUTO ALL OWWtp AU108 1 BODILY Imjww(Par pdwmw P.O. Box 20895 Fountain valley, CA 92728 ACORO 25-S (7/90) l.tr 1. I7V � rn�wnc � v �wn�L va+v� w ....c v.,..�� ......+..� .... ..-- -• - • -- - - - - - LIABILITY& ANY KIND UPON THE COMPANY. ITS AGENTS OR REPRESENTATIVES. IIIRLD AUTOS ; ; BODILY wJUnY t tt'rK NON-O"M AUTOS :AARAtiF 1 IARt11TY PROPERTY DAMAGE E EXCESS LIABILITY EAc" OCCUnnENCE ! UMDnELLJA ronM AQCnLGATE t 'OTIICn TIIAN U ADnCLLA rOnM i EX C AD, C% Ca STATUTORY LIMIT& WORKER'S COMPENSATION FACH A=Df-WT a See AND See Attachment A . "AO 7/1/92 7 / 1 J 9 3 ' DISEASE—POLICY UMII Attach- EMPLOYkks' uAWL1TY DISEASE- EACH EMPLOYCC - s ment "A" OTHM DESCRIPTION OF OMRATIOMS"CATIONIWVENICI.EA/ PSCIAL ITEM' As respect -a: Agreement_ to finance Water Desalter P] ant CERTIFICATE HOLDER CANCELLATION Metropolitan Water D i. s t r �.c t_ SHOULD ANY d' THE ABOVE UESCfllkit=D 1`OLICII:S HE CANCELLED bEl'Olit THC Ex1•IMIION DATE THEREOF. THE ISSUING COMPANY WILL ENDEAVOn 10 of Orange County MAII 3Q DAYS W$4[l l tN NOI K`k 1 O 1 HE CEnI II-i0AI t HOLULA MASSIF p 1 O 1 Hf 1 tl S ii ii lr 1 1 ] !; Avenue :. - h!! P.O. Box 20895 Fountain valley, CA 92728 ACORO 25-S (7/90) l.tr 1. I7V � rn�wnc � v �wn�L va+v� w ....c v.,..�� ......+..� .... ..-- -• - • -- - - - - - LIABILITY& ANY KIND UPON THE COMPANY. ITS AGENTS OR REPRESENTATIVES. KUDLK I I- .1)K1VLK UyJJUI- 1u - i ice» — EVIDEN( )F CONTRACT OF POOLED SELF-' ^ 'RANCE ISSUE DATE__1 -4jlf 9 ROBERT F. DRIVER ASSOCIATES 3636 BIRCH STREET, #►230 VEWPORT BEACH, CA 02680 (714) 756-0271 ORANGE COUNTY CITIES RISK INSURED MANAGEMENT AUTHORITY AND MFMBFA AGENCY OF: CITY OF TUSTIN 35222 DEL AMO • CA 92680 THIS EVIDENCE OF CONTRACT IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE HOLDER. THIS DOES NOT AMEND, EXTEND, OR ALTER THE COVERAGE AF- FORDED BY THE CONTRACT DESCRIBED BELOW. LE71 EH A: INnIVInUAL CITY'S SELF-INSURED RETENTION LETTER R: "Orange County mes Risk Managoment Authority. A Public Agency." 7USTIN, • MEMBLR AGFNCY 01' '1 HE ORANGE COUNTY CITIES RISK MANAGEMENT Am HoniTY. COVERAGE PER CA. GOVERNMENT CODE SECTION 990.4(aa)/ 990.8(c) THIS IS TO CERTIFY THAT THE PARTY NAMED ABOVE HAS ENTERED INTO A CONTRACT OF POOLED SELF-INSURANCE AS LISTED BELOW FOR CONTRACT PERIOD INDICATED. NOTWITHSTANDING ANY RE- QUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS EVIDENCE OF SELF-INSURANCE MAY BE ISSUED OR MAY PERTAIN, THE COVERAGE AFFORDED BY THE SELF- INSURANCE CONTRACT DESCRIBED HERE IS SUBJECT 10 ALL THE TERMS, EXCLUSIONS. AND CONDITIONS OF THE CONTRACT OF SELF-INSURANCE. LTR rYPE OF COVERAGE CONTRACT NUMBER CONTRACT EFFDEa IIVE CONTRACT ON EXPIRATION A GENERAL AND AUTOMODILE SELF INSl1NFn LIABILITY 7/1/92 7/1/93 9 EXCESS LIABILITY• - OCC 0 0 0 6 7/1/92 17/1/93 UNITS IN BI a PD s 250, Is N/A fXWRINFn PERSONAL INJURY I t INC-. RI s Pn s 4, 750, s - ... MMLUNED 15 , 000 , • THE ABOVE NOTED CONTRACT OF SELF-INSURANCE IS A CLAIMS -MADE CONTRACT DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES / SPECIAL ITEMS As respects: Agreement to finance Water. Desalter Plant CO -*THF 1 IMITS SHOWN MAY HAVE BEEN REDUCED BY PAID LOSSES. HOLDER CANCELLATION SHOULD ANY OF 1 HE AIK)Vr nrSCRIE1CO CONTRACTS BE CANCELLED BEFORE 1 Hk Metropolitan Water District EXPIRATION DATE THEREOF. IMF: IIISK MANAGCMENT AUTHORITY WILL ENDEAVOR a Count 10 MAIL :Ill DAYS WRITTEN NOTICE 10 THF HOI nr-A NAMED HEREON BUT FAILURE of Orange y 10 MAIL SUal NOTIC17 SIIALL IMPOSE NO OBLIGATION Ott LIABILITY OF ANY KIND 10500 Ellis Avenue LHON 1 Mt HUSK MANAGCMCNT AUT1 IOFi1TY, OR ITS REPRESENTATIVES. P.O. Box 20895 AUTHORIZED SIGNATURE Fountain Valley, CA 92728 A A IJK1 VL --K H55U1. PlIf *O; Ms1:►r dW. COVERAGE DESCRIP77ON FOR: ORANGE CATV CITIES RISK MANAOEM13NT AUTHORITY . GENERAL REINSURANCE CORPORA71ON - POLICY XD 065 $20,000.000 WORKERS' COMPENSA77ON S 2,000,000 EMPLOYER'S LIAINUTY $20,000.000 COMBINED LIMIT FOR WORKM' COMPENSATION AND EMPLOYER'S LIABIL.iTY. FIREMAN'S FUND INSURANCE COMPANY - POLICY #XLX 1651-7743 EXCESS TO STATUTORY - WOR M'S COMPENSATION SELY INSURED RETEIMON INSURED'S PMMNTION OF EACH ACCIDENT OR EACH EM"yEB FOR DISEASE $275.000 WORKER'S COMPENSATION $2759000 EMPLOYERS' LIAB11XIT S27S9000 WORKERS' COMPENSATION AND EMPLOYER'S LIABILITY COMBINED. DATE. AUGUST 26, 1L992 ,♦�l l �U� Inter -Com �� ..,- = . TO: GARY VEER, WATER SERVICES MANAGER FROM: CITY ATTORNEY SUBJECT: JOINT PARTICIPATION AGREEMENT WITH METROPOLITAN WATER DISTRICT, MUNICIPAL WATER DISTRICT OF ORANGE COUNTY AND ORANGE COUNTY WATER DISTRICT I have reviewed the above -referenced agreement, discussed it with the people at Orange County Water District, and I find it to be satisfactory as drawn (except for page 29 on which we have revised the signature block for Tustin). JAMir!'l G. MdURKE, City Attorney IGR: jab:D:0825920C-237.jnb) cc: Ronald Nault William Huston