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HomeMy WebLinkAboutCarlsbad Energy Center LLC; 2015-02-10;AGREEMENT FOR REIMBURSEMENT OF COSTS FOR THE CONSTRUCTION OF A RECYLED WATER PIPELINE TO SERVE THE CARLSBAD ENERGY CENTER PROJECT Between CARLSBAD MUNICIPAL WATER DISTRICT, a Public Agency organized under the Municipal Water District Act of 1911 and a Subsidiary District of the City of Carlsbad AND CARLSBAD ENERGY CENTER LLC, an indirect wholly owned subsidiary of NRG ENERGY, INC. AGREEMENT FOR REIMBURSEMENT OF COSTS FOR THE CONSTRUCTION OF A RECYCLED WATER PIPELINE TO SERVE THE CARLSBAD ENERGY CENTER PROJECT (NRG ENERGY, INC.) THIS AGREEMENT for Reimbursement of Costs for the Construction of a Recycled Water Pipeline to Serve the Cartsbad Energy Center Project, dated as of fe4>r'L/cx^x^ fO 2015 ("Agreement") is made in San Diego County, California, by and between the CARLSBAD MUNICIPAL WATER DISTRICT, a public agency organized underthe Municipal Water Disthct Act of 1911, and a Subsidiary Distnct of the City of Cartsbad ("District"), and CARLSBAD ENERGY CENTER LLC, an indirect wholly owned subsidiary of NRG ENERGY, INC., ("NRG") a Delaware corporation, with reference to the following recitals: RECITALS A. NRG owns and operates the existing Encina Power Station located within the City of Carlsbad and intends to replace this facility with a new power generation facility known as the Carisbad Energy Center Project ("CECP"). B. NRG desires to use recycled water at the CECP as part of the operation for generating electnc power and has requested recycled water service from District. C. District does not currently have recycled water facilities in or adjacent to the CECP property at this time, but is planning to construct an 18-inch diameter recycled water pipeline in Avenida Encinas ("Project") in 2015 that will terminate at Cannon Road. D. Recycled water service can be provided to the CECP if approximately 3,300 linear feet of 12" diameter pipeline ("Recycled Water Extension") is constructed north from Cannon Road to the CECP. District requires the Recycled Water Extension be a public pipeline, and NRG agrees to provide necessary easements on the CECP parcel. E. NRG recognizes the potential schedule benefit of having the Distnct construct the Recycled Water Extension and acquire necessary permits and easements as part of District's Project. NRG acknowledges that the Recycled Water Extension may be used by District to serve recycled water to other customers in the future. F. Distnct agrees to install, or cause the installation of the Recycled Water Extension, and NRG agrees to reimburse District for costs as set forth in this Agreement. NOW, THEREFORE, the Distnct and NRG agree as follows: 1. Recitals. The Recitals, above, are true and correct and incorporated herein by this reference. 1/12/2015 4:24 PM 51 General District Obligations. (a) In consideration of NRG's reimbursement and other undertakings as set forth herein. District agrees to cause the construction of the Recycled Water Extension. Work shall include those improvements as shown on City Drawing No. 474-5, Sheet Nos. 17-21, dated December 12 2014, prepared by Brown and Caldwell (the "Plans") and attached as Exhibit "A", which are incorporated herein t)y this reference: (i) Approximately 3,365 linear feet of 12-inch diameter recycled water pipeline. (ii) All necessary valves and appurtenances necessary to operate the Recycled Water Extension, including those necessary to connect to the District's pipelines. (b) Any portion of the Recycled Water Extension completed before the effective date of this Agreement shall be included as a part of the Recycled Water Extension for reimbursement, subject to the other provisions of this Agreement. (c) District shall cause the construction of the Recycled Water Extension to be substantially in compliance with the District-approved plans and specifications, and other design documentation for the Recycled Water Extension. 3. General NRG Obliaations. (a) NRG shall reimburse District an amount (the "Reimbursement Amount") equal to: (i) the actual cost of Recycled Water Extension subject to the limits authorized by this Agreement, plus (ii) an allowance for overhead and other costs as described in Section 5 below. The Reimbursement Amount shall include all costs associated with the installation of the Recycled Water Extension described in Section 2(a) and shown on the attached Exhibit "A" and approved change orders. The Reimbursable Amount is as estimated and shown in Table 1. (b) The Design Engineering Costs are based upon the District's Amendment No. 5 to Agreement with Brown and Caldwell in the amount of $67,830, dated October 7*, 2014, attached hereto as Exhibit "B". NRG agrees to reimburse District for these design engineering costs and change orders for the Recycled Water Extension pursuant to the terms and conditions set forth below. 4. Reimbursable Work. (a) Reimbursable Work includes design engineering, construction, construction management and inspection, survey, geotechnical services and easement acquisition costs related and necessary for completion of Recycled Water Extension. 1/12/2015 4:24 PM (b) Reimbursable Design Engineering costs shall be actual costs incurred as defined in the engineering agreement identified in 3(b) above. (c) Reimbursable Construction Costs shall be actual costs incurred pursuant to contract(s) issued as a result of a competitive bidding process. District will solicit for bids and award to lowest responsive bids. Recycled Water Extension shall be bid together with the District's Project. Upon award of a construction contract for the Recycled Water Extension, the actual costs thereof shall be allocated among the categories consistent with the method and process used in Table 1. The parties agree that the costs shown in Table 1 are a fair allocation of the costs. (d) Reimbursable Work shall also include: (i) Design Engineering or Construction Costs incurred pursuant to change orders. (ii) District staff overhead cost at a set 2.5% of actual Reimbursable Construction Costs. (iii) Costs related to preparation of the legal description and plats necessary for easements required for Recycled Water Extension. (iv) Overhead costs for construction management, inspection, and materials testing necessary for the Recycled Water Extension. Said cost shall be 8% ofthe actual Reimbursable Construction Costs. (e) During the performance of any Reimbursable Work, District shall retain detailed payment records for all items of Reimbursable Work. Payment records may include items such as copies of plans, specifications, engineer's cost estimates, bids received, contracts, change orders, invoices, payment slips, canceled checks, lien releases and other documentation reasonably required by NRG to evidence the completion and payment for each item of Reimbursable Work. 5. Payment of Reimbursable Expenses. (a) NRG agrees to provide District with a deposit for 100% of the estimated cost shown in Table 1 within 30 days ofthe District's Board's execution of a construction contract for the Project. (b) The estimated cost of the Reimbursable work shown in Table 1 is furnished only for the convenience of NRG. It is intended to reflect the District's general past experience of the cost of similar work under favorable conditions. Because of unforeseen conditions and other factors, the actual cost may be considerably higher or lower than this estimate. Therefore, the estimate is not a warranty by the District of the actual cost. (c) The District will provide NRG with monthly statements to reflect actual Project costs incurred to date and the most current estimate of costs to complete the Project. When actual costs exceed the estimate, the District will invoice NRG for the additional cost. NRG agrees to pay additional cost within 30 days of invoice for those additional amounts. 1/12/2015 4:24 PM 3^ (d) If actual cost is less than the deposit amount provided by NRG for the Reimbursable Work, District will refund the difference (without interest) to NRG. 6. Disputes/Claims. If a dispute should arise regarding the performance or interpretation of this Agreement, the following procedure shall be used to resolve any question of fact or interpretation not informally resolved by the parties. Such questions, if they become identified as a part of a dispute among persons operating under the provisions of this Agreement shall be reduced to writing by the principal of NRG or the Director. A copy of such documented dispute shall be fonwarded to both parties involved along with recommended methods of resolution which would be of benefit to both parties. The Director, or principal, upon receipt, shall reply to the letter, including a recommended method of resolution within ten (10) days. If the recommended resolution is unsatisfactory to the aggrieved party, the aggrieved party may request an informal conference to try and informally resolve the disagreement. The meeting shall be held within fourteen (14) days of the request. If an informal meeting is not requested or if an informal meeting failed to resolve the disagreement, a letter outlining the dispute shall be fonwarded to the District Board of Directors for their resolution through the office of the Executive Manager. The Board of Directors may, but is not obligated to resolve the dispute. If the Board of Directors considers the dispute, and directs a solution, the action of the Board of Directors shall be binding upon the parties involved, although nothing in this procedure shall prohibit the parties from seeking remedies available to them at law. 7. Notices. Unless otherwise specifically provided herein, all notices, demands or other communications given hereunder shall be in writing and shall be deemed to have been duly delivered upon personal delivery, or by Federal Express (or similar reputable express delivery service), or by facsimile transmission with back-up copy mailed the same day, or as of the second business day after mailing by United States Certified Mail, return receipt requested, postage prepaid, addressed as shown below. Notices required to be given to Developer shall be addressed as follows: NRG ENERGY, INC. Attention: Regional General Counsel 100 California Street, Suite 650 San Francisco, CA 94111 Telephone: 415.627.1639 Notices to District shall be delivered to the following: CARLSBAD MUNICIPAL WATER DISTRICT c/o City of Carisbad Attention: Public Works Director 1635 Faraday Avenue Carisbad, CA 92008 Telephone: (760) 602-2730 FAX: (760)602-8562 1/12/2015 4:24 PM Each party shall notify the other immediately of any changes of address that would require any notice delivered hereunder to be directed to another address. 8. Transfer bv NRG. The obligations and benefits of this Agreement may be transferred by NRG to another entity upon prior approval of the District, such approval not to be unreasonably withheld. 9. Counterparts. This Agreement may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute one and the same instrument. 10. Governing Law and Venue. This Agreement shall be interpreted and enforced under the laws of the State of California, and venue shall reside in San Diego County, California. 11. Complete Agreement. This Agreement contains the entire agreement between the parties with respect to the subject matter contained herein, and supersedes all negotiations, discussions, and prior drafts with respect to this subject matter. 12. Amendment. This Agreement may be amended by a written instrument executed by District and Developer except that no amendment regarding the provisions for reimbursement to Developer shall be valid unless executed by both NRG and the District. 13 Term. This Agreement shall be effective as of the date first above written, and shall terminate on December 31, 2050. 14. No Third Party Beneficiaries. This Agreement shall not be deemed to confer any rights upon any individual or entity which is not a party hereto, and the parties hereto expressly disclaim any such third-party benefit. 15. Severability. The invalidity or unenforceability of any provision of this Agreement, as determined by a court of competent jurisdiction, shall in no way affect the validity or enforceability of any other provision hereof. 1/12/2015 4:24 PM HI TABLE 1 Estimated Unit Total Item Item Description Units Quantity Price Price CONSTRUCTION COST 1 12" PVC C900 Pipe LF 3363 150 $504,450 2 12" Gate Valve EA 4 5,000 $20,000 3 Air Release Valve (AVA) EA 1 6,000 $6,000 4 Blow-off & MAR EA 6 5,000 $30,000 5 Surface Repair (Paved) LF 2200 30 $66,000 6 Surface Repair (unpaved) LS 1163 18 $20,934 7 Mobilization (8%) LS $52,431 8 Traffic Control LS 1 5,000 $5,000 9 Storm Water BMPs LS 1 3,000 $3,000 SUBTOTAL CONSTRUCTION COSTS $707,815 20% CONTINGENCY $141,563 TOTAL CONSTRUCTION COST $849,378 DESIGN AND ADMINISTRATION COSTS District Staff Overhead (2.5%) Design (B&C) Easement (plat and legal) Const Mgt/lnsp/Test (8%) TOTAL ADMINISTRATIVE COST $21,234 $67,830 $2,500 $67.950 $159,514 TOTAL PROJECT COST $1,008,892 1/12/2015 4:24 PM IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first above written. CARLSBAD ENERGY CENTER LLC a Delaware limited liability company By: (sign here) (print name and title of signatory) CARLSBAD MUNICIPAL WATER DISTRICT, a Public Agency organized under the Municipal Water District Act of 1911 and a Subsidiary District of the City of Carisbad, California (Proper notarial acknowledgment of execution by Contractor must be attached. Chairman, president or vice-president and secretary, assistant secretary, CFO or assistant treasurer must sign for corporations. Othenwise, the corporation must attach a resolution certified by the secretary or assistant secretary under corporate seal empowering the officer(s) signing to bind the corporation.) APPROVED AS TO FORM: Celia A. (BrewerrGeneral Counsel Deputy General Counsel 1/12/2015 4:24 PM CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT STATE OF CALIFORNIA COUNTY OF SAN FRANCISCO On January 12, 2015 before me, J.M. Bergman, Notary Public, personally appeared John Chillemi, J. M. BERGMAN I COMM. #2046489 2 Notary Public • California g Contra Costa Countv - Comm. Expires Nov. 20, .2017f who proved to me on the basis of satisfactory evidence to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of Califomia that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature Signature of > Signature of Notary Public Place Notary Seal Above OPTIONAL Description of Attached Docimient Title of Type of Document: Agreement for Reimbursement of Costs for the Construction of a Recycled Water Pipeline to Serve the Carlsbad Energy Center Project Document Date: January 12, 2015 Nimiber of Pages: 8 CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of. On •7(1111^ Date personally appeared before me, T] kj^re Insert Namerand Title of the^icer Name(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person^ whose name(^ is/afe subscribed to the within instrument and acknowledged to me that he/oho/thoy executed the same in his/her/their authorized capaclty(ie^, and that by his/hcr/thGir slgnature(s) on the instrument the person^), or the entity upon behalf of which the person(s) acted, executed the instrument. - ' Tl t •_ MORGEN FRY Commission #2091497 Notary Public - Califomia San Diego County LSgggki'jPiras Dac 24. Mia i I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature Place Notary Seal Above OPTIONAL Though this section is optional, completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. 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