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HomeMy WebLinkAboutSan Diego County Water Authority; 2002-05-08;JUL 3 I 2002 COOPERATIVE AGREEMENT AMONG THE CARLSBAD MUNICIPAL WATER DISTRICT, THE CITY OF OCEANSIDE, P AND tAE” SAN DIEGO COUNTY WATER AUTHORITY SEAWATER DESALINATION PROJECT FEASIBILITY STUDY IN CARLSBAD This agreement, among the San Diego County Water Authority (AUTHORITY) and the Carlsbad Municipal Water District (CARLSBAD), the City of Oceanside (OCEANSIDE) gestablishes the framework for cooperation among the AUTHORITY, CARLSBAD, OCEANSIDE and S&-€G60with regard to efforts by Poseidon Resources Corporation, Inc. (POSEIDON) to locate a seawater desalination facility in the City of Carlsbad (Desalination Project). RECITALS: A. In June 2000, CARLSBAD authorized POSEIDON to proceed with the preparation of a feasibility study and a detailed proposal for the development of the Desalination Project. B. AUTHORITY, OCEANSIDE and- recognize CARLSBAD’s primary role in authorizing Poseidon to conduct the current Desalination Project feasibility study. C. OCEANSIDE, a member agency of Authority, located adjacent to CARLSBAD, has discussed with CARLSBAD and POSEIDON the potential to receive product water deliveries from the Desalination Project. OCEANSIDE, CARLSBAD and AUTHORITY desire to cooperate in further analysis of this potential. E. AUTHORITY, CARLSBAD, OCEANSIDE and -(PARTIES) recognize that the Desalination Project has the potential for significant regional as well as local water supply reliability benefits. F. AUTHORITY adopted a Seawater Desalination Action Plan in January 2001 that includes seeking out partnership opportunities with CARLSBAD regarding the Desalination Project. G. In November 2001, the Metropolitan Water District of Southern California' (Metropolitan) released a Request for Proposals for its Seawater Desalination Program (SDP). The SDP will provide up to $250 per acre-foot through a competitive solicitation process. The program is currently limited to an initial contracted amount (for the Metropolitan service area) of 50,000 acre-feet. A Statement of Interest regarding the Desalination Project was submitted to Metropolitan by AUTHORITY. Proposals are due by June 28,2002. H. The PARTIES desire to cooperate among themselves, coordinate activities, and define roles and responsibilities for the following purposes: To mutually evaluate and consider the Desalination Project feasibility study prepared by POSEIDON as well as potential long-term water supply and other agreements that would be needed to implement the Desalination Project. To respond jointly to the Metropolitan Seawater Desalination Program Request for Proposals in a timely manner. THEREFORE, in consideration of the recitals and mutual interests of the PARTIES herein expressed, the AUTHORITY, CARLSBAD,-and OCEANSIDE agree as follows: 1. PARTIES' RESPONSIBILITIES A. The PARTIES shall form a Technical Steering Committee consisting of designated representatives from each PARTY. The Technical Steering Committee shall be responsible for coordinating the activities of the PARTIES with respect to the Desalination Project: mutually evaluating feasibility studies prepared by POSEIDON, managing communication among the PARTIES pursuant to this agreement, proposal responses to Metropolitan, evaluating draft long-term water supply agreements prepared by POSEIDON, coordinating review and evaluation of draft environmental, finance, construction, operation and other feasibility studies necessary or convenient to a thorough due diligence review of the project; and other similar purposes and activities. B. AUTHORITY recognizes that CARLSBAD, OCEANSIDEamay desire to receive product water deliveries directly from the Desalination Project, independent of any regional participation. Nothing in this agreement precludes CARLSBAD or OCEANSIDEe&"BHB from such direct independent participation in the Desalination Project. C. Lead Agency for the purposes of Desalination Project compliance with the California Environmental Quality Act (CEQA) and the National Environmental Policy Act (NEPA) will be determined at a later date. Page 2 D. The PARTIES agree that an evaluation of the feasibility study submitted by POSEIDON as well as other issues including, but not limited to environmental compliance, finance, construction and operational issues necessary or convenient to a thorough due diligence review of the project and /or a long-term water supply agreement will most effectively and efficiently be accomplished jointly by the PARTIES. The PARTIES further recognize that special technical expertise will be required to conduct such evaluation. As such, the PARTIES agree to the following: 0 AUTHORITY shall have responsibility for the day-to-day management and direction of the consultant team conducting the due diligence evaluation e AUTHORITY, in cooperation with CARLSBAD, OCEANSIDE,arrrtSAhl- -W€643will provide general oversight and direction, through the Technical Steering Committee, of the consultant team to assist with the evaluation. 0 AUTHORITY recognizes that CARLSBAD, OCEANSIDE- may also carry out their own evaluation of the feasibility study andlor long- term water supply agreement proposal. PARTIES agree to share information derived through their respective evaluation processes to the extent that information is not considered confidential as described in Section 1 .E below. ~~ AUTHORITY, CARLSBAD, OCEANSID-agree to share costs for outside evaluation expenses incurred by the AUTHORITY. Cost- share responsibility among the PARTIES applies solely to those outside costs associated with the review and evaluation of technical studies, draft terms and conditions for a water supply agreement, or other information developed by POSEIDON related to their proposal for the Desalination Project. The allocation of costs will be based on the percent of total water production reserved by each agency for potential direct purchase. e Upon completion or termination of the due diligence evaluation described herein, AUTHORITY will invoice CARLSBAD, OCEANSIDEa" -for payment of their respective share of applicable outside evaluation expenses incurred by AUTHORITY. Total shared outside evaluation expenses shall not exceed $410,000 without prior authorization of the PARTIES. 0 In order for PARTIES to participate in the Technical Steering Committee and receive information, materials, and analyses developed by the Consultant Team for purposes of conducting the due diligence evaluation of the Desalination Project, the PARTIES must execute this agreement no later than April 30, 2002. Page 3 0 In the event one or more of the PARTIES does not execute this agreement by April 30, 2002 the provision of information, materials and analyses developed by the consultant team and participation on the Technical Steering Committee shall be by mutual written agreement of the remaining parties including conformance with the cost share provisions of this section herein E. The PARTIES agree to consult with, cooperate with and share information with each other during any evaluation process concerning a long-term water supply agreement with POSEIDON, should two or more of the parties desire to continue beyond the acceptance of the Feasibility Study. The PARTIES agree that such information sharing will not extend to internal deliberations or contract negotiations. If one or more of the PARTIES decides to negotiate a long-term water supply agreement, independent of the other PARTIES, such negotiations will be considered confidential. F. The PARTIES agree to cooperate with each other in good faith to respond in a timely manner to the anticipated Metropolitan Seawater Desalination Program Request for Proposals. G. The PARTIES agree that in the event one or more of the PARTIES determine that a Proposal for the Desalination Project be submitted in response to the pination Program Request for Proposals, dated November 2001, and any addendum or amendments thereof, that a single joint proposal be prepared for the Desalination Project by the those PARTIES desiring to submit such Proposal and that such Proposal be submitted on behalf of those PARTIES by AUTHORITY H. The PARTIES agree that in the event that the governing body of one or more of the PARTIES, with the exception of AUTHORITY as the sponsoring Metropolitan Member Agency, has not taken action in regard to submission of a Proposal for funding under the Metropolitan SDP by June 28, 2002, and that one or more of the PARTIES desires to submit a Proposal to Metropolitan, a proposal shall be submitted by AUTHORITY on behalf of the remaining PARTIES no later than June 28,2002. I. Nothing in the Proposal submitted under the Metropolitan Seawater Desalination Program by Authority shall limit the subsequent ability of the PARTIES to determine institutional roles and responsibilities or contractual relationships, if any, with Poseidon or each other in regard to the Desalination Project. Page 4 .- 2. HOLD HARMLESS AND LIABILITY CARLSBAD, OCEANSIDEyand the AUTHORITY each agree to mutually indemnify, defend at its own expense, including attorneys’ fees, and hold each other harmless from and against all claims, costs, penalties, causes of action, demands, losses and liability of any nature whatsoever, including but not limited to liability for bodily injury, sickness, disease or death, property damage (including loss of use) or violation of law, caused by or arising out of or related to any negligent act, error or omission, or willful misconduct of that party, its officers or employees, or any other agent acting pursuant to its control and performing under this agreement. 3. TERM The term of this agreement shall be from the date written below to December 31, AUTHORITY and CARLSBAD and OCEANSIDE-. 2002. The term of this Agreement may be extended by written agreement of the 4. NOTICE Any notice, payment, credit or instrument required or permitted to be given thereunder will be deemed received upon personal delivery or 24 hours after deposit in any United States mail depository, first class postage prepaid and addressed to the party for whom intended as follows: If to AUTHORITY: San Diego County Water Authority 4677 Overland Avenue San Diego, CA 92123 ATTN: Ken Weinberg If to CARLSBAD: If to OCEANSIDE: Carlsbad Municipal Water District 5950 El Camino Real Carlsbad, CA 92008 AlTN: Robert Greaney City of Oceanside 300 North Coast Highway Oceanside, CA 92054 ATTN: Barry Martin Page 5 Any party may change such address by notice given to the other parties as provided herein. 5. AMENDMENTS The agreement may be amended as circumstances necessitate by written agreement executed by the PARTIES. 6. ASSIGNMENT CARLSBAD, OCEANSIDE, -or AUTHORITY shall not assign, sublet, or transfer this agreement or any of the rights or interests in this agreement without the written consent of the other parties. 7. SEVERABILITY The partial or total invalidity of one or more parts of this agreement will not affect the intent or validity of remaining parts of this agreement. a. GOVERNING LAW ~m State of California and for all purposes shall be interpreted in accordance with such laws. The PARTIES hereby agree and consent to the exclusive jurisdiction of the courts of the State of California and that the venue of any action brought hereunder shall be in a superior court in San Diego County, California. 9. TERMINATION OF AGREEMENT This agreement may be terminated by any party hereto for any reason 30 days after notice in writing to the other parties. Financial obligations incurred up to the point of termination will be allocated using paragraph 1. D. Page 6 IO. SIGNATURES The individuals executing this agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities. IN WITNESS WHEREOF, the PARTIES have executed this agreement as of the date below. San Diego County Water Authority mirector of Water Resources Approved as to Form: .. -~ ..~ .- Daniel S. Haschke ' General Counsel Citv of Oceanside Approved as to Form: B &y/?.AiQQP City Attorney v Carlsbad Municipal Water District Executive Manager " Approved as to Form: n Page 7