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HomeMy WebLinkAbout1992-11-03; Municipal Water District; 194; Joint Participation AgreementCARLSBAD !+ !NICIPAL WATER DISTRICT -“fiGEN AB# 1017 TITLE: JOINT PARTICIPATION AGREEMENT BETWEEN MTG. 1 l/03/= THE CARLSBAD MUNICIPAL WATER DISTRICT, THE METROPOLITAN WATER AUTHORITY AND C’TY ATT DEPT. CMWD SAN DIEGO COUNTY WATER AUTHORITY RECOMMENDED ACTION: Adopt Resolution No. %20 authorizing the Executive Manager to enter into a Joint Participation Agreement between the Metropolitan Water District (MWD), the San Diego County Water Authority (SDCWA) and the Carlsbad Municipal Water District (CMWD) to allow MWD to financially participate in the Encina Basin Water Reclamation Project- Phase I under MWD’s Local Projects Program (LLP). ITEM EXPLANATION: The Carlsbad Municipal Water District has requested to enter into a Joint Participation Agreement between the Metropolitan Water District of Southern California (MWD), the San Diego County Water Authority, and the Carlsbad Municipal Water District. The agreement would allow MWD to financially participate in the Encina Basin Water Reclamation Project Phase I under MWD’s Local Projects Program (LLP). CMWD is requesting this LLP funding for its Encina Basin Water Reclamation Project, Phase I. This project will produce approximately 2,050 acre-feet per year of reclaimed water that will I replace a demand for potable water from the San Diego County Water Authority. As part of the project, CMWD will purchase reclaimed water from the Vallecitos Water District and Leucadia County Water District for distribution within Carlsbad. Carlsbad will be constructing a distribution system to deliver reclaimed water to the proposed users. The users include the La Costa Golf Course, Aviara Development (golf course and landscape irrigation), CALTRANS, and two agricultural growers, Frazee and Ukegawa. Under the proposed agreement, MWD would purchase the project’s actual yield from CMWD at a rate equal to the sum of MWD’s reclaimed water rate and the LPP contribution. MWD would then sell the project’s actual yield back to CMWD via the I Authority at MWD’s reclaimed water rate, leaving CMWD with a net contribution equal to the LPP rate of $154 per acre-foot. MWD’s financial contribution will make possible the construction of the Encina Basin Water Reclamation Project, Phase I. The San Diego County Water Authority Board of Directors, at their October 8th Board meeting, authorized their General Manager to enter into the Joint Participation Agreement. This was done at the recommendation of the Water Authority Reclamation Advisory Committee (WARAC) at its September 28th meeting. In addition, the CMWD Water Commission has reviewed this item and recommends to the Board that the Executive Manager be authorized to enter into the Joint Participation Agreement. -. Page 2 of Agenda BIII No. / A?L FISCAL IMPACT: This Joint Participation Agreement will allow the Metropolitan Water District to provide CMWD with the Local Projects Program funds of $154 per acre foot for reclaimed water. These funds will be used to help offset the costs of CMWD’s Water Reclamation program by providing funds (including funds from the sale of reclaimed water) for the repayment of the $5,000,000 low-interest loan from the State Water Resources Control Board. The Water Commission met on October 14,1992 and recommends that the Board authorize the Executive Manager enter into the agreement with the Metropolitan Water District and the San Diego County Water Authority. EXHIBITS: 1. Resolution. dn . 8-&D- 2. Diagram of Reclaimed Water Rebate. 3. Encina Basin Water Reclamation Project Phase I Joint Participation Agreement for Development and Utilization of Reclaimed Water Between the Metropolitan Water District of Southern California and San Diego County Water Authority, and Carlsbad Municipal Water District. RESOLUTION NO. 820 A RESOLUTION OF THE BOARD OF DIRECTORS OF THE CARLSBAD MUNICIPAL WATER DISTRICT AUTHORIZING THE EXECUTIVE MANAGER TO ENTER INTO A JOINT PARTICIPATION AGREEMENT BETWEEN THE METROPOLITAN WATER DISTRICT, THE SAN DIEGO COUNTY WATER AUTHORITY AND THE CARLSBAD MUNICIPAL WATER DISTRICI’ WHEREAS, the Board of Directors of the Carlsbad Municipal Water District approved the Encina Basin Water Reclamation Project - Phase I program; and WHEREAS, the Board of Directors of the San Diego County Water Authority has authorized its General Manager to enter into the Joint Participation Agreement to allow the Metropolitan Water District to financially participate in the Encina Basin Water Reclamation Project - Phase I program; and WHEREAS, the Joint Participation Agreement will allow the Metropolitan Water District to provide the Carlsbad Municipal Water District with the Local Projects Program funds of $154 per acre foot for reclaimed water; and WHEREAS, these funds will help offset the costs of the Carlsbad Municipal Water District’s Water Reclamation program by providing funds for partial repayment of the $5,000,000 low-interest loan from the State Water Resources Control Board. NOW, THEREFORE, BE IT RESOLVED by the Carlsbad Municipal Water District Board of Directors as follows: 1. That the above recitations are true and correct. l/l 1 2 3 4 5 6 7 8 9 10 11 12 13 34 15 16 17 1E 1s 2c 23 2: 2: 24 25 26 27 2E 2. That the Board hereby authorizes the Executive Manager to enter into a Joint Participation Agreement between the Metropolitan Water District, the San Diego County Water Authority and the Carlsbad Municipal Water District to allow the Metropolitan Water District to financially participate in the Encina Basin Water Reclamation Project - Phase I under the Metropolitan Water District’s Local Projects Program. PASSED, APPROVED AND ADOPTED at a meeting of the Carlsbad Municipal Water District held on the 3rd day of NOVEMBER , 1992, by the following vote to wit: AYES: Board Members Lewis, Kulchin, Larson, Stanton, Nygaard NOES: None ABSENT: None ATTEST: ALETHA L. RAUTENWUNZ, Secre W I 4 m > < TV 0 0 E n cn l- o W I 0 Iv CL DRAFT September 17, 1992 ENCINA BASIN WATER RECLAMATION PROJECT PHASE I JOINT PARTICIPATION AGREEMENT FOR DEVELOPMENT AND UTILIZATION OF RECLAIMED WATER BETWEEN THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, SAN DIEGO COUNTY WATER AUTHORITY, AND CARLSBAD MUNICIPAL WATER DISTRICT TABLE OF CONTENTS Recitals . . . . . . . . . . Section 1. 2. 3. 4. 5. 6, 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Definitions . . . . . . Project Description . . Warranties. . . . i . . . . . l . . . . . . . . ........... ........... ........... Construction Responsibilities . Ownership of Facilities . . . . Operating Responsibilities. . . MWD Purchase of Actual Yield. . Resale of Actual Yield to SDCWA Project Water Rates . . . . . . Term and Amendments . . . . . . Hold Harmless and Liability . . Notice. . . . . . . . . . . . . Successors and Assigns. . . . . Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . and CMWD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . * . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Paue . . 1 . . 5 . . 7 . . 7 . . a . . a . . 8 . .lO . .ll . .12 . .12 . .12 .13 - . . .14 . .14 Integration. ..................... 14 Governing Law. ................ ; ... 14 Exhibits . Exhibit A (Project Description) Exhibit B (Map) ENCINA‘BASIN WATER RECLAMATION PROJECT PHASE I JOINT PARTICIPATION AGREEMENT FOR DEVELOPMENT AND UTILIZATION OF RECLAIMED WATER BETWEEN THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA, SAN DIEGO COUNTY WATER AUTHORITY, AND CARLSBAD MUNICIPAL WATER DISTRICT THIS AGREEMENT is made and entered into as of 1992, by and among THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA (hereinafter "MWD"), SAN DIEGO COUNTY WATER AUTHORITY (hereinafter "SDCWA"), and CARLSBAD MUNICIPAL WATER DISTRICT (hereinafter "CMWD"); . Exnlanatorv Recitals WHEREAS, MWD was incorporated under the Metropolitan Water District Act (@'Act") for the purpose of developing, storing, and distributing water for domestic and municipal purposes f WHEREAS, the Act empowers MWD to acquire water and water rights within or without the state: develop, store and transport water; provide, sell and deliver water at wholesale for municipal and domestic uses and purposes: set 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, SDCWA, as a member public agency of MWD under the Act, is a wholesale purchaser within its service area of water developed, stored, and distributed by MWD: WHEREAS, CMWD is a member public agency Of SDCWA and provides domestic and subpotable water Services within SDCWAls service area; WHEREAS, MWD's water supply and demand projections for its service area, including that encompassed by SDCWA, show that additional sources of supplemental water must be developed to meet future needs; WHEREAS, MWD has determined to take all reasonable and necessary steps'to maintain MWD's water supplies at levels which will meet the needs of the people in the MWD service area, which steps include detailed analyses of the conjunctive use of groundwater basins, water reclamation, and a variety of water conservation techniques; WHEREAS, MWD and SDCWA have determined that it is mutually beneficial for cost-effective local water projects originating in the service area of SDCWA to be developed as a supplement to MWD's imported water supplies in order to meet future water needs: WHEREAS, a significant amount of treated wastewater generated within the SDCWA service area is currently lost to the ocean, which water could be used for special subpotable purposes; WHEREAS, CMWD has obtained approval to distribute reclaimed wastewater for landscape irrigation from the California Regional Water Quality Control Board, San Diego Region, pursuant to Order No. 91-60 and any orders supplementary or amendatory thereof: -20 WHEREAS, significant additional quantities of Reclaimed Water could be distributed and sold by CMWD by means of additional capital facilities to distribute and use additional wastewater, thereby avoiding disposal thereof as a waste product, and avoiding the use of an equivalent volume of imported water for freeway, greenbelt, golf course and nursery irrigation purposes; WHEREAS, CMWD is currently planning and desires to construct additional capital facilities collectively known as Encina Basin Water Reclamation Project Phase I (hereinafter 88Project*1), to distribute, for municipal and domestic uses, additional wastewater, which will minimize present and future disposal of wastewater in a manner cost-effective for its End Users, thereby, reducing the need for additional water that otherwise must be delivered from MWD*s aqueduct water supply system; WHEREAS, CMWD, acting as Lead Agency, shall comply with the provisions of the California Environmental Quality Act (CEQA) before MWD will be obligated to make any payments under this agreement; WHEREAS, the Vallecitos Water District (VWD) owns and operates the Meadowlark Water Reclamation Facility (MWRF) in compliance with the California Regional Water Quality Control Board's reclaimed water requirements: WHEREAS, CMWD has executed an agreement with VWD for the delivery of up to 2,240 acre-feet per year of tertiary treated effluent from MWRF for the project; . -30 WHEREAS, the Leucadia County Water District (LCWD) owns and operates the Gafner Water Reclamation Plant (GWRP) in compliance with the California Regional Water Quality Control Board's reclaimed water requirements and plans to construct a 1.0 MGD tertiary facility; WHEREAS, CMWD has executed an agreement with LCWD for the delivery of a minimum of 394 acre-feet per year of tertiary treated effluent when available from LCWD for the project; WHEREAS, all parties believe development of Actual Yield (defined below) will benefit the local community within CMWD and the region served by MWD: WHEREAS, CMWD is empowered under Section and following of the Water Code to enter into contracts necessary to carry out its powers and purposes: WHEREAS, MWD desires to assist in increasing the distribution of Reclaimed Water that would not otherwise occur through the Project, by agreeing with CMWD to buy, at a purchase price established herein which may be adjusted from time to time, the Actual Yield of the Project and by selling said Actual Yield back to CMWD through SDCWA at rates to be set by MWD and SDCWA from time to time; WHEREAS, SDCWA desires to participate in and affirmatively support the Project by purchasing the Actual Yield of the Project from MWD and reselling said Actual Yield to CMWD; -4- WHEREAS, CMWD believes the contribution of MWD toward the cost of the Project, in the form of the purchase of the Actual Yield by MWD, will make the operation of the Project cost-effective, and thus desires to commit to repurchase said Actual Yield from MWD through SDCWA at rates to be set by MWD and SDCWA, respectively, from time to time: WHEREAS, the Project will produce Actual Yield to MWD which will correspondingly reduce demand of SDCWA for water supply from MWD; WHEREAS, the Project, when fully developed, is estimated as being capable of distributing up to 2,049 acre- feet per year of Reclaimed Water: 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: "Actual Yield" shall mean the actual amount of Reclaimed Water which is delivered by CMWD from the Project in any given year and available for sale by CMWD to XWD and resale by MWD to SDCWA as a member agency. "Actual Yield" shall exclude any Reclaimed Water MWD reasonably determines will not reduce SDCWA's demand for supply of potable water from MWD. Further, llActual Yield" shall exclude any Reclaimed Water produced and/or delivered by those components of the project for which CMWD has not complied with CEQA. 1.2: "Project" shall mean the "Encina Basin Water Reclamation Project Phase I I1 being designed and developed by CMWD, consisting of distribution facilities capable of meeting an average demand for 2,049 acre-feet of Reclaimed Water per year, and more particularly defined in Exhibit 'IA." 1.3: "Reclaimed water" shall mean subpotable water reclaimed from sewage which is not usable for human consumption, but subject to water quality standards and regulatory agency approval is usable for limited special purposes such as freeway, greenbelt, golf course and agricultural irrigation uses. 1.4: "Reclaimed water rate" shall mean those amounts which are charged by MWD and SDCWA, respectively, pursuant to the discretionary rate-setting authority of their Boards of Directors from time to time for the class of water produced by this Project and projects under the Local Projects Program (hereinafter MLPP"'). 1.5: "End user" shall mean each of the ultimate users of Reclaimed Water furnished by this Project. 1.6: "LPP Contribution" shall mean the net financial amount, on a per acre-foot basis, contributed by MWD to projects which participate in,the LPP. The LPP Contribution shall be a payment of $154 per acre-foot. A future increase in the LPP Contribution by the MWD's Board of Directors may -60 .- apply to this Agreement if CMWD demonstrates to the satisfaction of MWD's General Manager a need for the-increase in the LPP Contribution and guarantees production and reuse of a certain annual amount of reclaimed water. Primary factors in considering eligibility for any increase in the LPP contribution will be if the cost of producing the reclaimed water exceeds the applicable MWD noninterruptible rate and whether an increase is needed to achieve a guaranteed level of production. Section 2: Project Descrintioq. All of the principal elements of the Project are more particularly described in the summary and map, attached hereto as Exhibits "A" and "B," and incorporated herein by this reference. Section 3: Warranties. 3.1: CMWD, through agreements with VWD and LCWD warrants that it has a firm source of effluent water adequate * to operate the Project: 3.2: CMWD warrants that it is able and has a right to sell such Actual Yield as it produces from the Project. 3.3: CMWD warrants that it does not discriminate against employees or against any applicant for employment because of ethnic group identification, religion, age, sex, color, national origin, or physical or mental disability and further warrants that it requires all contractors and consultants performing work on the Project to comply with -70 . all laws and regulations prohibiting discrimination against employees or against any applicant for employment because of ethnic group identification, religion, age, sex, color, national origin, or physical or mental disability. 3.4: CMWD warrants that it will comply with the provisions of CEQA prior to commencing construction of each component of the Project. CMWD will furnish MWD a copy of the completed environmental documentation for each component of the Project, and shall demonstrate to the satisfaction of MWD's General Manager that the CEQA has been complied with before MWD will be obligated to make any payments under this agreement for Reclaimed Water produced and/or delivered by that component. Section 4: Construction Resuonsibilities. , CMWD shall be solely responsible for all design, environmental proceedings, right-of-way acquisitions, permits and construction of the Project and all modifications thereof. CMWD shall be responsible for all capital costs of the Project. Section 5: Ownershim of Facilities. CMWD shall be the sole and exclusive owner of all Project facilities, except for Project facilities which may be .installed within the boundaries of End User's property. MWD and SDCWA 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 MWD shall be in the form of an entitlement to purchase the Actual Yield generated by the Project and to sell the Actual Yield as set forth in Sections 7 and 8 hereof. ODeratinU ResDonsibilities. Sect'on 6: 1 6.1: CMWD shall be solely responsible for the operation and maintenance of all components of the Project, including, but not limited to, obtaining and providing Reclaimed Water as a supply for the Project, and for distribution and delivery of Reclaimed Water to all End Users. CMWD shall provide metering devices, to be owned, operated and maintained by CHWD, for the purpose of measuring the quantity of Actual Yield delivered to each End user. 6.2: CMWD agrees to properly operate, maintain, replace as necessary, and inspect the facilities comprising the Project, regularly and in accordance with all applicable state and federal laws, rules, regulations, and guidelines for the term of this Agreement. 6.3: CMWD shall, at all times during the term of this Agreement, use its best efforts to operate the Project facilities in accordance with generally accepted professional standards and maintenance and operation principles, and in such manner as to provide service to existing and future End Users on a fair and equitable basis. 6.4: CMWD shall at all times during the term of this Agreement provide sufficient qualified personnel to properly operate and maintain Project facilities. Such personnel shall meet applicable certification requirements of the pertinent regulatory agencies. 6.5: CMWD shall insure that all Reclaimed Water produced and delivered by the Project is used in compliance with all applicable federal, state and local statutes, ordinances, regulations and other requirements, and shall further insure that connections to the Reclaimed Water system are properly designed and constructed. 6.6: CMWD shall make available for inspection to MWD and SDCWA upon reasonable advance notice, all records, books and other documents relating to the operation of the Project. idPurchase Se tio 7: MWD 7.1: MWD shall purchase the Actual Yield from CHWD provided that, unless agreed otherwise in writing, MWD shali not be obligated to purchase in excess of 2,049 acre-feet delivered by the Project in any one MWD fiscal year (July 1 - . June 30). 7.2: MWD's purchase price shall be the sum of MWD@s reclaimed water rate plus the LPP Contribution determined in accordance with Section 1.4 and 1.6. 7.3: CMWD shall determine at the beginning of each month the quantity of reclaimed water billed to its customers during the preceding month and shall invoice MWD monthly for the Actual Yield. No minimum amount of Actual Yield is guaranteed. 7.4: MWD shall pay CMWD for invoiced Actual Yield within 45 days of receipt of CMWD's invoice. Papent shall be by means of a credit to CMWD on the next billing MWD makes to SDCWA. If payment is not made by MWD to SDCWA within said 45 days, it shall thereafter draw interest at a rate equivalent to the average invested funds during the beyond 45 days. interest MWD earns on its own time period payment is delayed 7.'5: Upon issuance of the credit, the Actual Yield shall, solely for purposes of billing and accounting, be deemed sold to MWD. Sale of water to MWD and SDCWA shall not affect CMWD's obligations under Section 11. Section 8: Resale of Actual Yield to SDCWA and CMWQ . I 8.1: v. MWD agrees to resell the Actual Yield to SDCWA simultaneously with MWD's purchase of respective Actual Yield from CMWD. SDCWA agrees to purchase that Actual Yield from MWD at MWD*s reclaimed water rate determined in accordance with Sections 1.4. 8.2: Purchase bv CMWD . SDCWA agrees in turn to resell the Actual Yield to CMWD simultaneously with its purchase of that Actual Yield from MWD pursuant to Section 8.1. CHWD agrees to purchase that Actual Yield from SDCWA at a rate equal to SDCWA~s reclaimed water rate determined in accordance with Section 1.4. -110 8.3: Process. Pavment Upon receiving the MWD billing, SDCWA shall include the full amount of each CMWD credit on its next billing to CMWD. On that same CMWD billing, SDCWA shall show that the Actual Yield has been resold to CMWD by debiting CMWD for such Actual Yield in accordance with the purchase price set forth in Sections 1.4 and 8.2. Such Actual Yield shall be deemed resold by SDCWA to CMWD as of the date of SDCWA's billing. 8.4: Obliaations. MWD's Nothing contained herein shall .MWD obligations, if any, established by be deemed to modify law or contract to supply water to SDCWA for domestic and municipal use within MWD's service area. Section 9: Proiect Water Rates. 9.1: The Board of Directors of MWD shall set. reclaimed water rates to be charged for the sale of the reclaimed water generated by this and similar projects. These rates may be changed from time to time by said Board. 9.2: The Board of Directors of SDCWA shall set reclaimed water rates to be charged for the sale of the reclaimed water purchased from MWD pursuant to this Agreement. These rates may be changed from time to time by *said Board. 9.3: The rates set by CMWD for subpotable water service shall be set in its sole discretion. -120 e s ct.0 : endments. 10.1: The term of this Agreement shall be seven (7) years from the date CMWD notifies MWD that the Project has begun operations. 10.2: This Agreement may be amended at any time by the written mutual agreement of the parties. Section 11: Hold Harmless and Liabilitv. CHWD agrees at its sole cost and expense to defend and hold MWD and SDCWA harmless from any claim and any and all liability, including but not limited to, liability due to water quality, which may arise out of CMWD's approval of, and subsequent construction and operation of the Project or out of the ownership of the Project, and will save and defend MWD and SDCWA and their officers, agents, and employees free from any claims for injury, including death or damage to property, or injury (including death or damage) due to water quality arising out of the construction, operation, or ownership of the Project. Such indemnity shall include all loss related to any claim made, whether or not a court action is filed, and shall include attorney fees, administrative and overhead costs, engineering and consulting fees and all other costs related to or arising out of such claim of liability. Section 12: 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 -130 States post office, first class postage prepaid and addressed to the party for whom intended, as follows: If If If to MWD: The Metropolitan Water District of Southern California 1111 Sunset Boulevard Post Office Box 54153 Los Angeles, California 90054 Attention: General Manager to SDCWA: San Diego County Water Authority 3211 Fifth Avenue San Diego, California 92103 Attention: General Manager to CMWD: Carlsbad Municipal Water District 5950 EE Camino Real Carlsbad, California 92008 Attention: General Manager Any party may change such address by notice given to each of the other parties as provided in this section. Set 3 Successors and Assicns. tx 'on 1 : This Agreement shall inure to the benefit of and be binding upon the successors and assigns of the parties hereto. No assignment shall be made without written agreement from the Parties. Section 14 : Severabilitv. The partial or total invalidity of one or more -140 . . sections of this Agreement of this Agreement. Section 15: Intearatioq. shall not affect the validity This Agreement comprises the entire integrated understanding between the parties concerning the Encina Basin Water Reclamation Project Phase I, and supersedes all prior negotiations, representations, or agreements. Section 16: Governinu Law. The law governing this agreement shall be the laws of the State of California. IN WITNESS WHEREOF, the parties hereto have executed ,. this Agreement effective as of the date first hereinabove written. APPROVED AS TO FORM: By: APPROVED AS TO FORM: By: APPROVED AS TO FORM: By: /cze f2. L RONALD R. BALL, General Counsel I/- c-w* BWENCIN2 THE METROPOLITAN WATER DISTRICT OF SOUTHERN CALIFORNIA By: SAN DIEGO COUNTY AUTHORITY WATER By: CARLSBAD MUNICIPAL WATER DISTRICT R. PATCI-kTT, Executive Manage -150 . - . EXHIBIT A r 00 cvw 0-W 8 00000000000000000000 9 s 9 e gs3”o roJCU og~fggw(DDooooooooooooooooo oo_ ar k rr? 35 v? y? b w,lrwnuiww ooQ)rr--- r cucv(3mm(3