CONTRACT BETWEEN EXHIBIT 10.15
ZONE 7 OF ALAMEDA COUNTY FLOOD CONTROL AND WATER
CONSERVATION DISTRICT AND CALIFORNIA WATER SERVICE COMPANY
FOR A MUNICIPAL & INDUSTRIAL WATER SUPPLY
THIS CONTRACT, made and entered into this 16th day of
November , 1994 , by and between ZONE 7 OF ALAMEDA COUNTY FLOOD
CONTROL AND WATER CONSERVATION DISTRICT, commonly known as the Zone 7
Water Agency, hereinafter referred to as "Zone 7" and the CALIFORNIA
WATER SERVICE COMPANY, hereinafter referred to as "Contractor."
W I T N E S S E T H:
For and in consideration of the terms and conditions herein
contained, Zone 7 agrees to furnish and provide a water supply to
Contractor, and Contractor agrees to purchase and accept such water
supply consistent with the provisions herein.
A. INTRODUCTORY PROVISIONS
1. Definitions
When used in this contract, the following terms shall have the
meanings hereinafter set forth:
a. "Board" shall mean the Board of Directors of Zone 7 of
Alameda County Flood Control and Water Conservation District.
b. "Each Contractor" or "Other Contractor" shall mean any
entity, public or private, contracting with Zone 7 for a
Municipal & Industrial Water Supply.
c. "Extract," "Extraction" or "Extracting" shall mean obtaining
groundwater, by pumping or any other means, from wells,
shafts, tunnels, excavations or other sources of such
groundwater, for domestic, municipal, irrigation, industrial
or other use.
d. "Groundwater Pumping Quota" shall mean that quantity of
water that the Contractor is entitled to extract from the
Main Basin without paying a recharge fee to Zone 7.
e. "In-Lieu Treated Water" shall mean that quantity of treated
water delivered from Zone 7 in exchange for an equal
reduction in Contractor's extraction of its Groundwater
Pumping Quota.
f. "Main Basin" shall mean that part of the Livermore-Amador
Valley groundwater basin located essentially within the
valley floor sections of the Castle, Bernal, Amador and
Mocho (II) Subbasins as defined in Bulletin No. 118-2,
Evaluation of Groundwater Resources: Livermore and Sunol
Valleys, State of California, Department of Water Resources
and shown in Exhibit A attached.
g. "Municipal & Industrial Water Supply" shall mean a supply of
water from Zone 7 to Each Contractor regardless of the
source of said water or Contractor's use of said water.
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h. "Other Sources" shall mean a water source from any person,
corporation or entity, whether public or private, other than
from Zone 7.
i. "Recharge" or "Recharged" shall mean managed replenishment
of the Main Basin including but not limited to spreading on
natural or improved channels or basins or well injection
with imported, locally developed, or recycled water, or
through In-Lieu Treated Water. Applied irrigation water
percolation shall not be considered recharge.
j. "Recycled Water" shall mean wastewater treated for reuse as
permitted by the California Department of Health Services,
the Regional Water Quality Control Board and other agencies
that from time to time may have jurisdiction.
k. "Safe Yield" shall mean the quantity of water that can be
successfully extracted from the Main Basin on an annual
basis over an extended number of years without reducing
groundwater storage. Such safe yield is the net quantity of
groundwater added to the Main Basin by stream percolation
(including percolation from stream releases required for
prior water rights), rainfall percolation, applied
irrigation water percolation, and net subsurface inflow.
l. "Treated Water" shall mean water that is processed as
necessary to comply with drinking water requirements of the
California Department of Health Services, the United States
Environmental Protection Agency and other agencies that from
time to time may have jurisdiction.
m. "Turnout Facilities" shall mean the facilities required to
provide treated water deliveries from Zone 7's water system
to the Contractor's water system. See Exhibit B for a
schematic of a typical turnout facility.
n. "Zone 7 Boundary" shall mean the boundary of Zone 7 as shown
on Exhibit C and as may be revised from time to time.
2. Term of Contract
This contract shall become fully effective upon execution of the
duly authorized signatures of the parties hereto and shall remain
in effect for a period of thirty (30) years from the date hereof,
unless terminated or extended prior to expiration of term by
mutual agreement at an earlier date.
B. WATER SERVICE PROVISIONS
3. Quantity of Water
Contractor shall purchase from Zone 7 all water required by
Contractor for use within Contractor's service area as defined in
Section 6 except that Contractor may extract groundwater as
provided in the Groundwater Extraction Provisions herein or
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obtain water from Other Sources under the conditions in Section
5. No quantity of water purchased from Zone 7 or extracted as
part of Contractor's Groundwater Pumping Quota shall be delivered
by or provided from Contractor to any area other than
Contractor's service area, except for short-term emergency and/or
public health purposes.
4. Quality of Water
All treated water to be delivered by Zone 7 to Contractor shall
be of a quality that complies with the Requirements for Drinking
Water of the California Department of Health Services and the
United States Environmental Protection Agency or their successor
regulatory agencies. Zone 7 will endeavor to provide treated
water that is aesthetically acceptable to the Contractor's
customers. Zone 7 will blend its different sources of water
within its operational capabilities to provide water of
approximately equal quality to Each Contractor.
5. Water from Other Sources
In order to protect Zone 7's financial interest, Contractor shall
not contract for, purchase or receive, with or without
compensation, either directly or indirectly, any water for use in
its service area from any source other than by extraction of its
Groundwater Pumping Quota or from purchase from Zone 7, except
for any one or more of the following:
(a) The water received is for fire flow or fire storage
requirements or other emergency purposes;
(b) The water delivered through Zone 7's turnout facility does
not comply with drinking water requirements of California
Department of Health Services, United States Environmental
Protection Agency, or successor regulatory agencies. The
quantity of water obtained shall be limited to that
necessary to meet Contractor's treated water needs as a
result of Zone 7's non-compliance with said drinking water
requirements;
(c) Zone 7 is unable to deliver the quantity of treated water
necessary to satisfy the requirements of Contractor. Zone 7
shall specify the quantity of treated water that it cannot
deliver and the time period for which it cannot satisfy the
Contractor's requirements. Contractor is otherwise
obligated to secure all water from Zone 7 to the extent Zone
7 can provide it;
(d) Zone 7 is able to meet Contractor's water delivery request,
and Contractor has paid Zone 7 for obligated fixed costs of
Zone 7 associated with the quantity of water the Contractor
will obtain from Other Sources. These obligated fixed costs
shall include but are not limited to water facility
improvements, water contract obligations, and debt service
thereto incurred by Zone 7 in supplying water that would
have gone to the Contractor, and for which said costs would
have been recovered through the sale of said water to
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Contractor. The Contractor shall obtain the prior written
approval from the Board which approval shall not be
unreasonably withheld;
(e) The source of water is groundwater extracted within Zone 7's
boundary but outside the Main Basin provided said extraction
does not cause an adverse impact on the Main Basin; or
(f) The source of water is recycled water from Contractor's or
Other Contractors' treated wastewater.
6. Contractor's Service Area
As used herein, the Contractor's service area shall include all
areas presently served water by Contractor. Contractor's service
area shall also include any future areas to be served by the
Contractor within the boundaries of Zone 7 subject to Subsection
32c. Contractor may include any future areas outside the
boundaries of Zone 7 upon a finding of the Board that providing
water to said area is in the best interests of Zone 7 and after
written modification of this contract providing for said service
area. The Contractor's present service area is designated on the
map attached hereto as Exhibit D. Contractor shall promptly
notify Zone 7 of changes in its service area, as may occur from
time to time, by furnishing a map to Zone 7 showing any change in
said service area so that Zone 7 can maintain a map indicating
the most recent Zone 7 water service area. Said changes in
service area shall be in accordance with the requirements of the
Local Agency Formation Commission, Public Utility Commission or
other agency having authority to set service areas.
Any future areas outside Zone 7 boundaries to be served by
Contractor which receive water from sources other than Zone 7 or
the Main Basin shall not be considered part of the Contractor's
service area under the terms of this contract.
7. Turnout Facilities
a. Turnout facilities shall be constructed at the general
location requested by Contractor. The exact location shall
be determined by Zone 7 after consultation with Contractor.
Turnout facilities shall be designed and/or constructed
either by Zone 7 or by Contractor (upon the written approval
of Zone 7) based on the ranges of flow set forth in Section
9. Turnout facilities shall include the necessary valves,
piping, meter and recording equipment, vaults, telemetry
equipment and any other appurtenances necessary to meet the
standards and operational needs of Zone 7. Zone 7 shall
submit its design of new turnout facilities to contractor
for review and written approval.
b. Contractor shall reimburse Zone 7 for all costs incurred by
Zone 7 related to the new turnout facilities including but
not limited to design, engineering, design review,
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construction, right-of-way and acquisition thereof,
inspection, and contract administration. Contractor shall
also pay all costs for the installation of all associated
landscaping and recognizes that Zone 7 shall not be
responsible for maintenance of landscaping under the terms
and conditions of this contract. Contractor further agrees
to grant or cause to be granted to Zone 7 the necessary
permanent right-of-way and right of ingress thereto and
egress therefrom, as determined by Zone 7, for the purposes
of constructing, operating and maintaining said turnout
facilities.
c. Zone 7 shall install the nozzle outlet portion of all
turnout facilities requested by Contractor prior to the
construction of the transmission pipeline. For turnout
facilities requested by Contractor subsequent to the
construction of Zone 7's transmission pipeline, Contractor
shall pay for the nozzle outlet portion of the turnout
facility, and all costs set forth in subsection b. above.
Ownership of turnout facility, including the shut off valve
downstream of the turnout facility, shall be with Zone 7,
and Contractor shall have no obligation to operate,
maintain, repair, replace or relocate the same.
8. Measurement of Treated Water Deliveries
At any time or times, Contractor may, upon request, inspect said
turnout facilities (in the presence of a Zone 7 representative),
and the measurements and records taken therefrom. Zone 7 shall
test and calibrate the instrumentation at each turnout meter at
least annually and furnish such results to the Contractor. When
requested by the Contractor, Zone 7 shall test and calibrate any
meter through which treated water is served to Contractor. The
Contractor shall have the right to be represented by a qualified
observer at and during any instrumentation and/or meter tests
and/or calibration. Whenever testing and/or calibration of the
instrumentation and/or the meter is requested by Contractor, and
in the event that any such test shall disclose an error exceeding
two percent (2.0%), an adjustment shall be made in charges
against the Contractor covering the known or estimated period of
duration of such error, but in no event exceeding six (6) months,
and the expenses of such test shall be borne by Zone 7;
otherwise, such expenses shall be borne by Contractor requesting
such tests.
9. Ranges of Flow
a. It is recognized that the range of flow rates of water
through a turnout facility may vary considerably over the
contract term. A normal range of flow rates for a turnout
facility is hereby established as from ten percent (10%) to
one hundred percent (100%) of a maximum design flow rate.
Contractor shall provide Zone 7 with the following
information for each turnout facility prior to the design of
such facilities:
(1) Anticipated ultimate (future) maximum flow rate,
(2) Anticipated present design range of flow rates. (The
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maximum design flow rate shall not exceed ten (10) times
the minimum design flow rate for this range in normal
installations.)
(3) Anticipated pressure ranges for (1) and (2) above on the
Contractor's side of the turnout facility.
b. Zone 7 shall design the metering and/or recording
installation for the range set forth in accordance with
Subsections (2) and (3) above with provisions for future
modifications in accordance with a range based on
Subsections (1) and (3) above.
c. Contractor shall regulate the flow demands through the
turnout facility such that the range of flow rates set forth
in accordance with Subsection b above will be maintained
insofar as such regulation is reasonable and practicable.
Zone 7 shall make modification of the metering and/or
recording equipment upon request of Contractor or at such
time that the actual flow rate exceeds the maximum design
flow rate or is less than the minimum design flow rate;
provided, however, that flow rates resulting from
emergencies shall not apply to such requirement for
modification. Said modification will be at the expense of
the Contractor and payment thereof shall be in accordance
with Section 27.
10. Delivery Schedule of Municipal & Industrial Water
Each year, the Contractor shall submit in writing to Zone 7 a
preliminary water delivery schedule on a form provided by Zone 7
indicating the anticipated quantity of treated water and
groundwater in excess of its Groundwater Pumping Quota required
by Contractor during each month of the succeeding five (5)
calendar years and the anticipated peak day treated water demand
from Zone 7 for each such year. Zone 7 shall review such
schedule, and after consultation with Contractor, shall approve
such schedule in a timely manner or make such revisions in the
same as may, in the judgment of Zone 7, be necessary to make such
deliveries. To the extent water is available to Zone 7, Zone 7
will approve in writing, a delivery schedule each year for
delivery to Contractor during the next succeeding calendar year
of an amount of water not less than the amount of water set forth
in the approved schedule for the then-current calendar year. The
amount of water set forth in the approved delivery schedule for
the next succeeding calendar year shall be the basis for which
Zone 7 shall contract with the State of California or other
entity for delivery to Zone 7. Zone 7 shall identify the reason
for any revisions or disapproval of Contractor's delivery
request. Zone 7 shall only revise or disapprove Contractor's
delivery request for the reasons set forth in Sections 12, 13, 14
or 15.
11. Reporting Use of Water
The Contractor shall report to Zone 7 on or before the tenth day
of each month the total volume, in acre-feet, of groundwater
extracted from the Main Basin and any water obtained from Other
Sources (including any water recharged to the Main Basin) for the
preceding month. The report shall become the basis for which
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water charge determinations and hydrologic inventory calculations
of the Main Basin are made by Zone 7. Said report shall be made
on a form or forms provided by or acceptable to Zone 7. The
measurement and recordation of such flows shall be subject to the
same provisions for inspection and testing of meters and
instrumentation by Zone 7 as is provided to Contractor in
Section 8.
12. Peak Demands
The Zone 7 system is not designed to serve all Contractor's peak
demands. As water demands increase, it may be necessary to
curtail peak deliveries to conform to Zone 7 system capacity as
it exists from time to time. However, so long as water and line
capacity are available, Zone 7 will endeavor to meet all
reasonable demands for peak deliveries and will use reasonable
diligence to provide a regular and uninterrupted supply of water
from its turnout facility, but shall not be liable to Contractor
for damages, breach of contract, or otherwise, for failure,
suspension, diminution, or other variations of service occasioned
by any cause beyond the control of, or without the fault or
negligence of Zone 7. Such causes may include, but are not
restricted to, acts of God, acts of war, or criminal acts of
others, acts of Contractor or Other Contractors, water shortages,
fires, floods, earthquakes, epidemics, quarantine restrictions,
strikes, or failure or breakdown of transmission or other
facilities.
13. Curtailment of Delivery During Maintenance Periods
Zone 7 will make all reasonable effort to provide continuous
service to Contractor but may schedule to temporarily discontinue
or reduce the delivery of water to Contractor for the purpose of
necessary investigation, inspection, maintenance, repair or
replacement of any of the facilities necessary for the delivery
of treated water to Contractor. Zone 7 shall notify Contractor
as far in advance as possible of any scheduled discontinuance or
reduction and the estimated duration of such discontinuance or
reduction. Recognizing that Contractor may rely on Zone 7 for
deliveries of water with minimal interruption, particularly
during the high water consumption months, Zone 7 shall use its
best efforts to make any such discontinuance or reduction in the
delivery of water only during the period of November through
March. In the event of any discontinuance or reduction in
delivery of water, Contractor may elect to receive the amount of
water that otherwise would have been delivered to it during such
period under the approved water delivery schedule at other times
during the year, consistent with Zone 7's delivery ability
considering the then current delivery schedules of all Other
Contractors.
14. Availability of Water
In any year in which a shortage occurs due to drought or other
cause in the supply of water available for delivery to Each
Contractor such that the supply to Zone 7 is less than the total
amount included in the approved delivery schedule of Each
Contractor for that year, Zone 7 shall reduce deliveries to Each
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Contractor in an amount that results in a reduction of total
water used within Contractor's service area that is equal to the
percent reduction for total water used within Zone 7's service
area for that year, all as determined by Zone 7; provided, that
Zone 7 may apportion on another basis if such is required to meet
minimum demands for domestic supply, fire protection, or public
health during the year.
The amount of water available under this contract and Zone 7's
obligation to supply water shall be subject to the terms and
conditions of the contract between Zone 7 and the State of
California for water service via the South Bay Aqueduct and any
other contracts Zone 7 may enter into for water supply; provided,
further, that wherever the provisions of the contract with the
State of California or other entity as to the availability of
water conflict with the provisions of this contract, the terms
and provisions of this contract shall prevail. Zone 7 shall give
Contractor written notice as far in advance as possible of any
reduction in deliveries that would be necessary because of a
shortage in water supply. Neither Zone 7 nor any of its
officers, agents, or employees shall be liable for any damage,
direct or indirect, arising from this contract caused by drought,
regulatory constraints, operation of area of origin statutes, or
any other cause beyond the control or without the negligence of
Zone 7.
15. Suspension of Service
In the event that Contractor shall be delinquent in the payment
for water for more than ninety (90) days after the due date (as
said due date is defined in Section 28), such delinquency shall
be called to the attention of the Board and the Board may, in its
discretion and after giving Contractor an opportunity to be
heard, order the suspension or reduction of service to
Contractor.
C. GROUNDWATER EXTRACTION PROVISIONS
16. Groundwater Pumping from the Main Basin
Zone 7 acknowledges Contractor's right to extract groundwater
based on Contractor's historical groundwater extractions and
based on the mutually agreed upon limitations in Contractor's
original water supply contract with Zone 7. Contractor
acknowledges that Zone 7 manages the Main Basin and that Zone 7
recharges, stores, and extracts from the Main Basin as necessary
to supply water to Each Contractor. Accordingly, Contractor
shall not extract under this agreement, more than 3,069 acre-
feet (1,000 million gallons), its Groundwater Pumping Quota, from
the Main Basin in any calendar year except as follows:
(a) The Contractor pays Zone 7 a recharge fee for recharging the
Main Basin as set forth in Section 17;
(b) The groundwater extracted is Contractor's accumulated carry-
over of its Groundwater Pumping Quota from prior years as
provided in Section 18; or
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(c) The source of the groundwater extracted is from Other
Sources obtained by Contractor pursuant to 5(c), 5(d), and
5(f) herein and the Contractor has previously recharged said
groundwater into the Main Basin. Said recharged water shall
not adversely impact Zone 7's use of the Main Basin,
including the recharge, storage or extraction thereof.
17. Recharge Water
In any calendar year, if Contractor should extract groundwater
from the Main Basin in an amount in excess of its Groundwater
Pumping Quota plus any accumulated carry-over and any groundwater
recharged by Contractor per 16 (c), Contractor shall pay Zone 7,
in addition to other payments required by this contract, a
recharge fee as set forth in the rate schedule and Sections 23
and 24 herein, for each acre-foot of water (or portion thereof)
in excess of said amount. In express consideration of
Contractor's agreement to pay such recharge fee, as aforesaid,
Zone 7 shall recharge the Main Basin in an amount aggregating the
quantity of such excess water.
Because said recharge fee would be in the nature of an assessment
fee upon annual extractions in excess of the Groundwater Pumping
Quota, if Zone 7 (or any other public body or agency) shall
impose a valid replenishment assessment fee or other charge upon
or measured by the pumping or extraction of water for use in
Contractor's service area, then the provisions of this Section
shall be superseded accordingly, except as to any payment
attributable to a period prior to the effective date of any such
assessment fee or other charge.
18. Carry-over of Groundwater Pumping Quota
If, in any calendar year, Contractor does not extract its entire
Groundwater Pumping Quota from the Main Basin, Contractor may
carry-over from that calendar year the unextracted portion of
Groundwater Pumping Quota for extraction from the Main Basin
during subsequent calendar years. Said carry-over or accumulated
carry-over shall not exceed 20 percent of the Contractor's
Groundwater Pumping Quota. Said carry-over shall not include any
Groundwater Pumping Quota waived under the In-Lieu Treated Water
provision of Section 19.
19. In-Lieu Treated Water
During periods when sufficient water is available to Zone 7 at
reasonable cost and Zone 7 desires to raise or maintain
groundwater levels, Zone 7 will offer delivery of treated water
at a cost that is less than treated water rates to Contractor in
lieu of Contractor extracting groundwater per its Groundwater
Pumping Quota. The amount of In-Lieu Treated Water that
Contractor may receive shall not exceed its Groundwater Pumping
Quota plus any accumulated carry-over or its operational
capability to extract said Groundwater Pumping Quota and
accumulated carry-over. Zone 7's offer to deliver In-Lieu
Treated Water for a given calendar year will be made on or about
May 1 of that year, however, said rates may be retroactive for
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the entire calendar year or other mutually agreed upon portion
thereof. Credit or payment for In-Lieu Treated Water will be as
provided for under Section 25. Contractor is not required to
take or purchase any In-Lieu Treated Water.
Contractor acknowledges that any credits or payments received
under Section 25 are received in-lieu of the Contractor's right
to extract its Groundwater Pumping Quota, and Contractor agrees
that its Groundwater Pumping Quota and any accumulated carry-over
shall be reduced by an amount equivalent to the amount of In-Lieu
Treated Water delivered by Zone 7 to Contractor for the year in
which the delivery is made.
20. Water Delivery Shortage Emergency Extractions
During a water supply emergency, as declared by the Board, in
which Zone 7 is unable to deliver the quantity of treated water
as approved on the delivery schedule, the Contractor may extract
water from the Main Basin in excess of the Contractor's
Groundwater Pumping Quota at a reduced recharge rate. Said rate
shall be the same as the In-Lieu Treated Water rate.
21. Transfer of Groundwater Pumping Quota
Temporary or permanent transfer of Contractor's Groundwater
Pumping Quota outside of the Zone 7 boundary shall not be
permitted. Temporary or permanent transfer of Contractor's
Groundwater Pumping Quota within Zone 7's boundary shall be
permitted provided that it is transferred to an Other Contractor.
Said transfer of Contractor's Groundwater Pumping Quota shall be
permitted upon written notification to Zone 7 from each
contractor that is a party to the transfer.
22. Changes in Contractor's Groundwater Pumping Quota
The annual Safe Yield of the Main Basin, estimated as
approximately 13,200 acre-feet per year in 1993, is essentially
the same as the long-term average extraction by existing
groundwater producers. The Board shall not increase any Other
Contractor's Groundwater Pumping Quota unless such increase in
Groundwater Pumping Quota is acceptable to Each Contractor with a
Groundwater Pumping Quota.
Neither Contractor nor Zone 7 waives any rights to pursue a court
adjudication of the safe yield of the Main Basin or any other
court action on extraction of groundwater from the Main Basin
that may change Contractor's Groundwater Pumping Quota.
Furthermore, Zone 7 reserves its authority to levy a
replenishment assessment on the extraction of any groundwater,
including Contractor's Groundwater Pumping Quota (excluding any
adjudication of the safe yield), as necessary to protect the
water supplies for users within Zone 7.
D. CHARGE AND PAYMENT PROVISIONS
23. Rate Schedule
Zone 7 shall charge for water in accordance with a rate schedule
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for water service, as such rate schedule is established or
amended by the Board. The Board shall review the rate schedule
and establish a rate schedule for each calendar year period in
accordance with the most recent costs and revenues of Zone 7.
The Board shall review the rate schedule at the September regular
meeting and endeavor to establish the rate schedule at the
November regular meeting prior to January 1 of the following
calendar year for which the rate schedule is to be effective.
The rates, including but not limited to the treated water,
in-lieu treated water, meter fee, and recharge fee, to be so
established, shall be based on the cost of providing service, and
shall not be unreasonable, arbitrary, or discriminatory. In the
event the Board fails, in conformity to the preceding schedule,
to establish a new rate schedule for any calendar year the rate
schedule in effect for the prior calendar year shall be continued
in full force and effect until otherwise modified by the Board.
24. Recharge Fee
The recharge fee shall be charged to Contractor in accordance
with the rates included in the rate schedule. Contractor shall
be invoiced by Zone 7 in accordance with Section 26 at the time
in which Contractor exceeds its Groundwater Pumping Quota as
provided in Section 17. Section 28 herein shall apply to said
charges. The recharge fee shall be based upon Zone 7's costs
including but not limited to the cost to purchase or develop the
water, as well as the cost to construct, maintain, and operate
the facilities needed to import, distribute, store, treat and
recharge said water into the Main Basin for the benefit of Each
Contractor.
25. In-Lieu Treated Water Credit
In any calendar year in which the Contractor has foregone pumping
of its Groundwater Pumping Quota, plus accumulated carry-over, as
set forth in Section 19, Zone 7 shall determine the amount of
delivered treated water that should be charged at the In-Lieu
Treated Water rate, and shall credit or make payment to the
Contractor the difference between the treated water rate and the
In-Lieu Treated Water rate.
26. Time for Payment
Contractor shall be invoiced on a calendar month basis for
charges. Contractor shall pay promptly all charges invoiced by
Zone 7, such invoices to be rendered on or about the 5th day of
each month for charges incurred in the preceding month and to
become due and payable within 30 days from date of invoice. In
the event that Contractor in good faith contests the accuracy of
any invoices submitted to it pursuant to this Section, it shall
give Zone 7 notice thereof at least ten (10) days prior to the
day upon which payment of the stated amount is due. To the
extent that Zone 7 finds Contractor's contentions regarding the
statement to be correct, it shall revise the statement
accordingly and Contractor shall make payment of the revised
amounts on or before the due date. To the extent that Zone 7
does not find Contractor's contentions to be correct or where
time is not available for a review of such contentions prior to
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the due date, Contractor shall make payment of the invoiced
amount on or before the due date and make the contested part of
such payment under protest and seek to recover the amount thereof
from Zone 7.
27. Payment for Turnout Facilities
Prior to commencing with the design of a turnout facility,
Contractor shall deposit with Zone 7 an amount of money estimated
by Zone 7 to cover all costs to be incurred by Zone 7 for
designing said turnout facility or shall request in writing to be
invoiced for such design in accordance with Section 26. The
option of invoicing Contractor shall be at the sole discretion of
Zone 7. Prior to constructing said turnout facility, Contractor
shall deposit with Zone 7 an amount of money estimated by Zone 7
to cover all costs to be incurred by Zone 7 for completion of
turnout facility or request to be invoiced for such construction
in accordance with Section 26. Following completion of the
construction of the turnout facility, Zone 7 shall submit to
Contractor a statement for the actual costs incurred for
completion of the design and construction of said turnout
facility as provided in Section 7. The deposit shall be applied
to the actual costs incurred by Zone 7, and the appropriate
refund or invoicing to Contractor will be made. Contractor shall
make payment of any such invoicing to Zone 7 within thirty (30)
days of submission of said statement. Zone 7 shall refund any
deposit in excess of actual cost within thirty days of Zone 7's
determination of said cost. Contractor shall have the right to
audit the records of Zone 7 for the purpose of verifying actual
costs.
28. Delinquent Payments
In the event that Contractor is delinquent in the payment of
invoiced charges for more than thirty (30) days after the due
date, delinquent amounts shall accrue at the legal rate of
interest commencing on the due date and continuing each month
thereafter until payment of both the principal amount of such
charges and the interest thereon is paid in full insofar as
permitted by law. Unless otherwise determined by law, the legal
rate of interest shall be the combined per annum discount rate of
the Federal Reserve Bank of San Francisco on the 25th day of the
current month and five percent (5%).
E. GENERAL PROVISIONS
29. Remedies
By reason of the specialized nature of the water service
rendered, and for the further reason that the extent of any
damage caused to either party by the other by reason of any
breach of this contract or agreement may be extremely difficult
to determine, it is agreed by the parties hereto that an action
for damages is an inadequate remedy for any breach, and that
specific performance, without precluding any other remedy
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available in equity or law, will be necessary to furnish either
party hereto with an adequate remedy for the breach thereof.
30. Assignment
This contract is not for the benefit of any person, corporation
or other entity, other than the parties hereto, and no person,
corporation or other entity except the parties hereto, shall have
any rights or interest in or under this contract unless otherwise
specifically provided herein. Contractor shall not assign or
transfer any rights or privileges under this contract, either in
whole or in part, without the prior written consent of Zone 7,
which consent shall not be unreasonably withheld, or make any
transfer of all or any part of its water system, or allow the use
thereof, in any manner whereby any provisions of this contract
will not continue to be binding on it, its assignee or
transferee, or such user of the system. This contract and the
rights and responsibilities provided for herein shall be binding
on the successors and assigns of the parties hereto.
31. Contract Modification
This contract may be amended or modified any time only by mutual
written agreement of the parties.
32. Liabilities
a. Zone 7 and/or any of its officers, agents or employees shall
not be liable for the control, carriage, handling, use,
disposal, or distribution of treated water supplied to
Contractor by Zone 7, after such water has passed through
the turnout facility or for claims of damage of any nature
whatsoever, including but not limited to property damage,
personal injury or death, arising out of or connected with
the control, carriage, handling, use, disposal or
distribution of such water beyond said turnout facility.
Contractor shall indemnify, save and hold harmless Zone 7
and its officers, agents, and employees from any such
damages or claims of damages. Contractor shall further
reimburse Zone 7 for costs of repair of Zone 7's facilities
and other damages resulting from the operations of
Contractor.
b. Contractor and/or any of its officers, agents, or employees
shall not be liable for the control, carriage, handling,
use, disposal, or distribution of water prior to such water
being delivered through the turnout facility or for claims
of damage of any nature whatsoever, including but not
limited to property damage, personal injury or death,
arising out of or connected with the control, carriage,
handling, use, disposal, or distribution of such water prior
to its delivery to Contractor, excepting, however, claims by
Zone 7 for costs of repair to Zone 7's facilities and other
damages resulting from the operations of the Contractor.
Zone 7 shall indemnify, save and hold harmless the
Contractor and its officers, agents, and employees from any
such damages or claims of damages, except claims by Zone 7
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for costs of repair of Zone 7's facilities and other damages
resulting from the operations of Contractor.
c. Zone 7 needs to be protected from any obligation to supply
water to projects or consumers which the contractor has
supplied from sources other than what has been directly
purchased from Zone 7. Accordingly, any other provision
herein notwithstanding, Zone 7 shall not be obligated nor
liable to provide, without exception, that quantity of water
obtained by Contractor pursuant to Subsections 5a-f, to
Contractor or any customer of Contractor regardless of
purpose. Accordingly, Contractor shall indemnify, save and
hold harmless Zone 7 from any and all obligations,
liability, responsibility, costs, expenses, or fees
associated in any way with any claims, demands, requests,
suits, causes of action of whatever type or nature
concerning the provision of any quantity of water obtained
by Contractor pursuant to Subsections 5a-f herein.
d. Likewise, if pursuant to Section 3 herein, Contractor is
instructed by Zone 7 to acquire water from Zone 7 which has
been previously acquired from third parties pursuant to
Subsections 5a-f herein, Zone 7 shall save and hold harmless
Contractor from any and all obligations, liability,
responsibility, costs, expenses, or fees that may arise from
such third parties.
33. Renewability
At the expiration of the thirty (30) year term of this contract,
said contract may be renewed upon the mutual consent of the
parties hereto. If no such renewal shall take place and in the
absence of any new contract, Zone 7 shall nevertheless continue
delivery to Contractor in accordance with this contract, that
quantity of water set forth in the approved delivery schedule for
the last full calendar year before the expiration of the term of
this contract. However, if a new contract is not entered into
within two (2) years from the date of expiration of this
contract, then the Board may, at its option, set the terms and
conditions for a Municipal & Industrial Water Supply.
34. Notices
All notices or other writings in this contract provided to be
given or made or sent, or which may be given or made or sent, by
one party hereto to another, shall be deemed to have been fully
given or made or sent when made in writing and deposited in the
United States mail, registered, certified or first class, postage
prepaid, and addressed as follows:
To Zone 7: General Manager
Zone 7 Water Agency
5997 Parkside Drive
Pleasanton, CA 94588
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To Contractor: President
California Water Service Company
1720 North First Street
San Jose, CA 95112-4598
The address to which any notice or other writing may be given or
made or sent to any party may be changed upon written notice
given by such party as provided above.
35. Severability
If any one or more of the terms or conditions set forth in this
contract to be performed on the part of Zone 7 or Contractor, or
either of them, should be contrary to any provisions of law or
contrary to the policy of law to such an extent as to be
unenforceable in any court of competent jurisdiction, then such
terms or conditions, shall be null and void and shall be deemed
severable from the remaining terms or conditions and shall not
affect the validity of the remaining provisions of this contract.
36. Section Headings
Section headings in this contract are for convenience only and
are not to be construed as a part of this contract or in any way
limiting or amplifying the provisions hereof.
37. Waiver
None of these terms or conditions herein contained can be waived
except by mutual written consent.
38. Water Conservation
In order to increase water supply by demand reduction or to
comply with regulatory requirements, Zone 7 will undertake and
support water conservation programs. To that end, Zone 7 will
develop, implement or participate in such programs and enter into
agreements with Other Contractors, and other entities to make
more efficient use of water supplies through water conservation
programs so long as such agreements serve a beneficial purpose to
the residents of Zone 7.
39. Contracts to be Substantially Similar
Zone 7 agrees that each contract for a Municipal & Industrial
Water Supply hereafter entered into by Zone 7 with any Other
Contractor shall contain provisions substantially similar to
those herein set forth and shall not contain any provisions of a
material nature more favorable to the Other Contractor than the
provisions herein applicable to Contractor. This section shall
not restrict Zone 7 from considering other terms and conditions
for subsequent Municipal & Industrial Water Supply contracts
provided that if such other terms and conditions are not
substantially similar, Zone 7 shall notify all Other Contractors
and offer such other terms and conditions in accordance with
Section 31 to Each Contractor. This section shall not limit Zone
7 from entering into other contracts for services not provided
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for under the terms and conditions of this contract.
IN WITNESS WHEREOF, the parties hereto and have executed this
contract on the date and year first above written.
CALIFORNIA WATER SERVICE ZONE 7 WATER AGENCY
COMPANY
BY \s\ DONALD L. HOUCK BY \s\ DAVID W. LAYTON
President Chairman, Board of Directors
ATTEST: ATTEST:
BY \s\ HELEN MARY KASLEY BY \s\ JIM DIXON
Secretary Secretary
APPROVED AS TO FORM:
KELVIN H. BOOTY, JR.,
COUNTY COUNSEL
BY \s\ BRIAN WASHINGTON
Deputy County Counsel
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