EXHIBIT 10.104
AGREEMENT FOR THE SALE AND PURCHASE
OF WASTEWATER EFFLUENT
THIS AGREEMENT, is made and entered into this 13th day of November 2000,
by and between the City of Tolleson, a municipal corporation organized and
existing under and by virtue of the laws of the State of Arizona ("Tolleson" or
"City"), and Arizona Public Service Company, a corporation organized and
existing under and by virtue of the laws of the State of Arizona ("APS") and
Salt River Project Agricultural Improvement and Power District, an agricultural
improvement district organized and existing under and by virtue of the laws of
the State of Arizona ("SRP"). The City, APS and SRP are collectively referred to
herein as the "Parties." APS and SRP are collectively referred to herein as "The
Companies." All references to "The Companies" in this Agreement shall include
APS or SRP, or both APS and SRP, or any affiliated or successor entity to either
SRP or APS, including but not limited to Pinnacle West Energy Corporation, an
affiliate of APS.
WITNESSETH:
WHEREAS, Tolleson owns, operates and maintains a wastewater treatment
plant (hereinafter the "Plant") situated approximately 1/4 mile south of State
Route 85 and approximately 1/4 mile west of 91st Avenue at which Tolleson treats
raw sewage collected from sources within and outside of the corporate boundaries
of Tolleson and produces treated wastewater effluent which, unless used by
Tolleson for other purposes, is discharged into the Salt River in accordance
with the laws of the United States and the State of Arizona (hereinafter
"Effluent" or "Tolleson Effluent");
WHEREAS, the rated treatment capacity of the Plant, assuming typical
influent quality, is currently approximately 17.5 million gallons per day
(hereinafter "M.G.D.") of influent;
WHEREAS, Tolleson is evaluating the possibility of having the existing
Plant re-rated to a capacity of greater than 17.5 M.G.D. of influent, and
Tolleson may in the future expand Tolleson's capacity in the Plant to create
capacity beyond 17.5 M.G.D.;
WHEREAS, Tolleson desires to reserve for its use and disposition as it may
in its own discretion elect, 10% of the amount of Effluent produced at the Plant
(hereinafter "Reserved Effluent");
WHEREAS, Reserved Effluent may be used, sold or otherwise disposed of by
Tolleson for any lawful purpose, including delivery and sale to The Companies
consistent with the terms of this Agreement;
WHEREAS, Tolleson desires to sell and The Companies desire to purchase all
available "Surplus Effluent," which for the purposes hereof shall be all of the
Effluent produced through the operation of the Plant in excess of the Reserved
Effluent, but not to exceed the maximum capacity of the current interconnection
(the "Interconnection Facilities") between the Plant and the pipeline (the
"Effluent Pipeline") that supplies effluent to the Palo Verde Nuclear Generating
Station ("Palo Verde"), and, when operational, the maximum capacity of the
modified Interconnection Facilities provided for in Section 5.2 below;
WHEREAS, additional wastewater treatment is provided at Palo Verde's
"Water Reclamation Facility" located at the northern end of the Palo Verde
property and the western terminus of the Effluent Pipeline;
WHEREAS, the Parties previously entered into an Agreement for the Sale and
Purchase of Effluent dated June 12, 1981 (the "Previous Agreement");
WHEREAS this Agreement is intended to replace the Previous Agreement,
which will be of no further effect upon execution of this Agreement; and
WHEREAS, the sale and purchase of the Surplus Effluent will result in its
beneficial use and in the reduction in the demand for the limited supplies of
unused surface waters and groundwaters;
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NOW THEREFORE, for and in consideration of the mutual covenants, terms and
conditions hereinafter stated, the Parties agree as follows:
SECTION 1. SALE AND PURCHASE OF SURPLUS EFFLUENT.
1.1 Except as provided in other Sections of this Agreement, Tolleson
shall sell and deliver to The Companies, and The Companies shall purchase and
accept, all of the Surplus Effluent produced through the operation of the Plant
during the term of this Agreement. In addition, Tolleson may sell and deliver to
The Companies, and The Companies may purchase and accept any or all of the
Reserved Effluent not used, sold or otherwise disposed of by Tolleson. Nothing
in this Agreement shall impair the right of Tolleson to use, sell or otherwise
dispose of any and all of the Reserved Effluent and any Surplus Effluent that
The Companies do not purchase and receive under this Agreement pursuant to
Sections 2.1, 3.3 or 9.2. The Companies' right to receive Surplus Effluent shall
have priority over Tolleson's use, sale or other disposition of any Surplus
Effluent except under conditions specified in Section 9.2.
1.2 This Agreement contains no requirement that Tolleson produce any
certain amount of Effluent at the Plant but merely that it deliver to The
Companies whatever amount of Surplus Effluent is produced, except as provided
elsewhere in this Agreement. However, the Parties understand and acknowledge
that since at least 1994 Tolleson has produced between 12,000 and 15,000
acre-feet of Effluent per year. Tolleson agrees that it will undertake all
reasonable, good faith efforts to maintain all existing contracts, operations
and facilities necessary to sustain discharges of Surplus Effluent meeting the
water quality standards of Section 3 at or above the level of 13,000 acre-feet
per year. Tolleson further agrees that it will not construct additional
wastewater treatment facilities at locations other than the current location of
the Plant if such facilities would adversely affect Tolleson's ability to
sustain discharges of Surplus Effluent meeting the water quality standards of
Section 3 at or above the level of 13,000 acre-feet per year. Tolleson further
agrees that it will notify The Companies, as soon as reasonably possible, of any
development or change in circumstances that may adversely affect
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Tolleson's ability to continue producing at least 13,000 acre-feet of Surplus
Effluent per year that meets the water quality standards of Section 3.
SECTION 2. PRICE AND PAYMENT.
2.1 The Companies shall pay to Tolleson, for all Effluent that is
sold and delivered hereunder for use at or for the benefit of Palo Verde, a
price of Thirty Dollars ($30.00) per acre-foot for calendar years 2000 through
2002. Beginning with calendar year 2003 and throughout the remaining term of
this Agreement, the price to be paid in all subsequent years during the term of
this Agreement for all Effluent that is sold and delivered hereunder for use at
or for the benefit of Palo Verde shall be determined by multiplying the previous
year's price by the average annual percentage increase in the Consumer Price
Index ("CPI") during the immediately preceding five years. Exhibit A to this
Agreement, which is specifically incorporated herein by this reference, states
the formula, and provides an example, for making the CPI-based price adjustments
required by this Section. If, in the sole judgement of The Companies, the price
to be paid to Tolleson for Effluent to be delivered and sold for use at or for
the benefit of Palo Verde, after application of the CPI-based price adjustment
mechanism set forth in this Section, becomes too high in comparison to the price
of treated wastewater effluent available to Palo Verde from sources other than
Tolleson, The Companies may elect to terminate their obligation to accept and
pay for Surplus Effluent for use at or for the benefit of Palo Verde. If The
Companies elect to terminate their obligation to accept and pay for Surplus
Effluent for use at or for the benefit of Palo Verde pursuant to this Section,
they shall provide Tolleson one year's advance written notice of such election
to terminate. Provided, however, that upon receipt of written notice of The
Companies' election to terminate pursuant to this Section, Tolleson may elect to
sell Surplus Effluent to The Companies for use at or for the benefit of Palo
Verde at the same price then being paid by The Companies for treated wastewater
effluent used at or for the benefit of Palo Verde and sold by sources other than
Tolleson (the "New Price"). Tolleson shall provide written notice to The
Companies of its election to begin selling Surplus Effluent at the
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New Price within 180 days after Tolleson receives notice of The Companies'
election to terminate pursuant to this Section. If Tolleson provides such
written notice within the required 180 day period, The Companies shall continue
to accept and pay for Surplus Effluent used at or for the benefit of Palo Verde
at the New Price, consistent with all other terms of this Agreement. If Tolleson
does not provide such written notice within the said 180 days, any obligation of
Tolleson to supply Surplus Effluent for use at Palo Verde shall be permanently
terminated.
2.2 If Effluent is used at or for the benefit of the proposed
electric generating facility commonly referred to as "Redhawk" or any electric
generating facilities other than Palo Verde that are owned (in whole or in part)
or operated by The Companies (collectively referred to as "Other Electric
Generating Facilities") pursuant to Section 4.1, the price to be paid for all
such Effluent shall be Seventy Five Dollars ($75.00) per acre-foot during
calendar years 2000 through 2002. Beginning with calendar year 2003 and
throughout the remaining term of this Agreement, the price to be paid by The
Companies for Effluent delivered into the Pipeline and used at or for the
benefit of Other Electric Generating Facilities shall be determined by
multiplying the previous year's price by the average annual percentage increase
in the CPI during the immediately preceding five years. The formula to be used
for making this adjustment, and an example of its application, are contained in
Exhibit A. The Companies shall measure, keep records of, and report to Tolleson
on a monthly basis the quantity, if any, of Effluent used at or for the benefit
of such Other Electric Generating Facilities.
2.3 The Companies shall pay Tolleson monthly an amount equal to the
price determined pursuant to Section 2.1 and/or 2.2 hereof, as applicable,
multiplied by the number of acre-feet of Effluent that were delivered and
accepted for use at or for the benefit of the respective facilities (Palo Verde
or Other Electric Generating Facilities) during the prior month. Such monthly
payments shall be due and payable 30 days after receipt of the invoice therefor
rendered by Tolleson.
2.4 In the event of a dispute concerning the quantity of Effluent
delivered and accepted in any month, The Companies shall pay the invoiced
amount, but may do
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so under written protest. If any protested amount shall subsequently be
determined to have been excessive, the excessive amount thereof shall be
refunded to The Companies. Any dispute or protest shall be resolved in the
manner provided by Section 12.7 hereof.
2.5 The Companies shall pay Tolleson the price determined pursuant
to Section 2.1 for each acre-foot of Surplus Effluent made available by Tolleson
for delivery under this Agreement and meeting the water quality standards of
Section 3 that is not accepted by The Companies, up to the then-operational
maximum capacity of the Interconnection Facilities, except during any
Uncontrollable Force event as defined in Section 9.1. Payments under this
Section shall be made to Tolleson monthly in an amount equal to the price
determined pursuant to Section 2.1 multiplied by the number of acre-feet of
Surplus Effluent meeting the water quality standards of Section 3 made available
by Tolleson for delivery, but not accepted by The Companies, during the prior
month. Such monthly payments shall be due and payable 30 days after receipt of
the invoice therefor rendered by Tolleson. The Companies shall have no
obligation to pay for Reserved Effluent not actually accepted into the Effluent
Pipeline for use at or for the benefit of Palo Verde or Other Electric
Generating Facilities. If The Companies elect to terminate their obligation to
accept and pay for Surplus Effluent for use at or for the benefit of Palo Verde
pursuant to Section 2.1, the obligation to pay for Surplus Effluent, whether
taken or not, under this Section shall remain in effect for any Other Electric
Generating Facility for which one or more Notices of Commitment have been
submitted to Tolleson pursuant to Section 8.2. Provided, however, that if The
Companies terminate their obligation as to Palo Verde, the number of acre-feet
thereafter subject to the payment obligation imposed by this Section shall be
the number of acre-feet specified in the Notice(s) of Commitment previously
submitted to Tolleson. Provided further that, if The Companies terminate their
obligation as to Palo Verde, the Parties shall meet to determine, based on
actual operating history and projected future needs, the number of acre-feet of
Surplus Effluent that will remain committed to such Other Electric Generating
Facilities. Such remaining committed Surplus Effluent shall be used only at or
for the benefit of such Other Electric Generating Facilities.
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2.6 The methods identified in Paragraphs 2.1 and 2.2 above for
determining the price to be paid by The Companies pursuant to this Agreement for
each acre-foot of Effluent delivered into the Effluent Pipeline by Tolleson and
accepted by The Companies for use at Palo Verde or Other Electric Generating
Facilities, and the resulting prices established by those methods, shall remain
in effect throughout the term of this Agreement. Provided, however, that: (i) if
The Companies enter into a new contract, or amend an existing contract, for
supplying treated wastewater effluent to Palo Verde or Other Electric Generating
Facilities physically capable of being economically served by Tolleson Effluent
delivered into the Effluent Pipeline; and (ii) that new contract or amendment of
that existing contract provides for a higher price, or a different method of
determining the price, of treated wastewater effluent supplied to Palo Verde or
Other Electric Generating Facilities physically capable of being economically
served by Tolleson Effluent delivered into the Effluent Pipeline; then (iii)
Sections 2.1 and/or 2.2 of this Agreement, as applicable, shall be revised to
incorporate that higher price or new method of determining the price. The
application of any different method of determining the price of effluent under
this Section 2.6 shall not result in a lower price being paid to Tolleson than
if such different method were not used. The provisions of this Section shall not
apply to any contract entered into by The Companies for a backup supply of
treated wastewater effluent that allows The Companies to purchase such effluent
when Tolleson is unable to deliver into the Pipeline at least 13,000 acre-feet
per year of Surplus Effluent meeting the water quality standards of Section 3.
The price benefits afforded to Tolleson by this Section shall apply if The
Companies purchase another source of treated wastewater effluent, other than a
backup supply pursuant to the immediately preceding sentence, for use at or for
the benefit of any Other Electric Generating Facility physically capable of
being economically served by Tolleson Effluent delivered into the Effluent
Pipeline, whether or not the other source of treated wastewater effluent is
delivered into the Effluent Pipeline. For purposes of this Agreement, the phrase
"physically capable of being economically served by Tolleson Effluent delivered
into the Effluent Pipeline" shall apply only to any Other Electric Generating
Facilities located within: (i) the area described in the legal
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description and accompanying map attached to this Agreement as Exhibit B, which
exhibit is specifically incorporated herein by this reference; or (ii) within
one mile north or two miles south of any portion of the Effluent Pipeline. The
Companies agree, as a covenant of good faith, to comply with the requirements of
this Section and Section 4.2 by refraining from constructing or acquiring Other
Electric Generating Facilities in locations immediately outside the area defined
in the preceding sentence as subject to the "physically capable of being
economically served by Tolleson Effluent delivered into the Effluent Pipeline"
standard if such construction or acquisition is intended to avoid the
requirements of this Section or Section 4.2.
2.7 In addition to any amounts The Companies are required to pay
under paragraphs 2.3 and 2.5 of this Agreement, The Companies shall also pay
Tolleson monthly, from the date of execution of this Agreement until June 30,
2002, an amount equal to the difference between: (1) the sum of the amounts paid
under paragraphs 2.3 and 2.5 of this Agreement; and (2) the amount that The
Companies would have been required to pay Tolleson for an equal quantity of
Effluent under the Previous Agreement among APS, SRP and Tolleson dated June 12,
1981.
2.8 If at any time The Companies fail to pay to Tolleson the amounts
they are obligated to pay under Sections 2.3 and 2.5 within the 30 days provided
for such payment, Tolleson may, after providing 10 days advance written notice,
cease delivering Surplus Effluent into the Effluent Pipeline until all past due
amounts are paid in full.
SECTION 3. QUALITY OF THE SURPLUS EFFLUENT.
3.1 All Effluent sold and delivered hereunder shall have received
wastewater treatment, and shall meet the standards required by law and specified
in Permit No. AZ0020338 issued to Tolleson by the Environmental Protection
Agency (hereinafter "EPA"), including any amendments or replacements thereof as
may be made from time to time and/or in any other required permit or
authorization as may hereafter be issued by the Arizona Department of
Environmental Quality (hereinafter "ADEQ"), or any other federal or state agency
having
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jurisdiction respecting the treatment and/or discharge of wastewater effluent,
except that disinfection (by chlorination or otherwise) of such Effluent sold
and delivered hereunder shall be required and performed only upon the terms and
conditions hereinafter provided.
3.2 In addition to meeting the permit-based water quality
requirements specified in Section 3.1, Tolleson shall use its best efforts to
operate and maintain its existing Plant in a manner that will treat Effluent
such that the Effluent does not exceed: (i) 30 milligrams per liter (mg/l) of
Biological Oxygen Demand ("BOD") for any period of time; (ii) 25 mg/l BOD for
any period longer than two consecutive days; (iii) 20 mg/l BOD for any period
longer than one week; or (iv) 15 mg/l BOD for any period longer than one month.
Nothing contained in this Section 3.2 shall require Tolleson to upgrade or
improve the Plant or otherwise compel Tolleson to incur any additional expense
in the operation of the Plant.
3.3 The Companies shall not be required to purchase, accept or pay
for any Effluent that does not meet the water quality standards set forth in
Sections 3.1 and 3.2 hereof. The Companies' sole remedy for breach of Tolleson's
obligation to meet the water quality standards of Sections 3.1 and 3.2 shall be
the right to refuse to purchase, accept or pay for any Effluent that does not
meet those standards.
3.4 Tolleson, on the written request of The Companies, shall
disinfect the surplus Effluent to be delivered to The Companies, provided that
The Companies shall reimburse Tolleson for its direct costs associated with such
disinfection.
3.5 Tolleson shall promptly notify APS by telephone, and in writing
as soon as reasonable thereafter, of any changes in wastewater treatment
processes or operational anomalies at the Plant that have the potential to
significantly change the composition of the Effluent delivered to The Companies,
including, but not limited to, changes that would affect compliance with the
water quality standards addressed in this Section 3. The Companies acknowledge
that the Plant has exceeded, and will exceed the foregoing BOD levels, and
Tolleson acknowledges that The Companies will not be obligated to purchase any
Effluent produced by Tolleson that exceeds the foregoing BOD levels.
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SECTION 4. USE OF EFFLUENT.
4.1 The primary use of the Effluent purchased and accepted by The
Companies under this Agreement is for cooling required for generation of
electric power at Palo Verde. The Companies may also use, transfer or execute a
water exchange for any or all of the Effluent made available under this
Agreement for use at or for the benefit of any Other Electric Generating
Facilities that The Companies may now or in the future develop, own (in whole or
in part) or operate. All such Effluent used at or for the benefit of Other
Electric Generating Facilities shall be subject to the price established in
Section 2.2.
4.2 If at any time The Companies use any treated wastewater effluent
at or for the benefit of Other Electric Generating Facilities physically capable
of being economically served by Tolleson Effluent delivered into the Effluent
Pipeline, Tolleson shall have the first right to sell to The Companies, and The
Companies shall have the obligation to purchase from Tolleson, all such treated
wastewater effluent, up to the then-operational maximum capacity of the
Interconnection Facilities, provided that:
(a) the treated wastewater effluent requirements of Palo Verde are being
fully satisfied, whether by Tolleson Effluent or by effluent from
other sources;
(b) the Participants in Palo Verde consent to the use of the Effluent
Pipeline, Water Reclamation Facility and any other property or
facilities owned by such Participants for transportation and
treatment of Effluent for use at or for Other Electric Generating
Facilities (provided, however, that if such consent is not obtained
from the Palo Verde Participants by December 31, 2001, Tolleson may
elect to terminate its obligation under this Agreement to deliver
and sell Surplus Effluent to the Companies); by its execution of
this Agreement, APS confirms its consent, as a Palo Verde
Participant, to the use of the Effluent Pipeline, Water Reclamation
Facility and any other Palo Verde property or facilities required
for transportation and treatment of Effluent for use at or for Other
Electric Generating Facilities; and
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(c) Tolleson produces the lesser of 12,000 acre feet per year of
Effluent or sufficient Surplus Effluent meeting the water quality
standards of Section 3 to satisfy the quantity specified in any
Notices of Commitment delivered to Tolleson by The Companies
pursuant to Section 8.2.
To the extent that all of the preceding requirements are satisfied, Tolleson
shall have the first right to sell to The Companies, and The Companies shall be
obligated to purchase from Tolleson, treated wastewater effluent for use at or
for the benefit of Other Electric Generating Facilities physically capable of
being economically served by Tolleson Effluent delivered into the Effluent
Pipeline, up to the lesser of: (i) the maximum quantity of effluent used at or
for the benefit of such Other Electric Generating Facilities physically capable
of being economically served by Tolleson Effluent delivered into the Effluent
Pipeline; or (ii) the then-operational maximum capacity of the Interconnection
Facilities. For the purpose of determining the times when The Companies must
take Surplus Effluent first at Other Electric Generating Facilities physically
capable of being economically served by Tolleson Effluent delivered into the
Effluent Pipeline, The Companies shall allocate all treated wastewater effluent
that The Companies acquire, other than Surplus Effluent, first for use at Palo
Verde. Only after purchasing all available Surplus Effluent meeting the water
quality standards of Section 3 may The Companies purchase treated wastewater
effluent from another source for use at or for the benefit of such Other
Electric Generating Facilities physically capable of being economically served
by Tolleson Effluent delivered into the Effluent Pipeline, or use groundwater
for condenser cooling in lieu of such Surplus Effluent, except to the extent
that groundwater is necessary to make up any shortfall in cooling water
requirements resulting from physical constraints in the Effluent Pipeline, Water
Reclamation Facility or other Palo Verde facilities. Nothing in this Agreement
shall prohibit or limit the right of The Companies to enter into additional
contracts with other parties for the sale and purchase of wastewater effluent to
be used at Palo Verde or Other Electric Generating Facilities, provided that
such contracts do not limit Tolleson's rights under this Agreement. To the
extent that any amount of Surplus Effluent is used at or for the benefit of
Other Electric
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Generating Facilities, Tolleson shall be relieved of any obligation it may have
under this Agreement to supply that quantity of Surplus Effluent for use at or
for the benefit of Palo Verde.
SECTION 5. DELIVERY POINT AND METERING.
5.1 Effluent sold and purchased hereunder shall be delivered by
Tolleson and accepted by The Companies at the valve that controls the flow of
Effluent into the Effluent Pipeline (hereinafter the "Delivery Point") at the
interconnection between the two outfall wastewater lines from the Plant to the
Salt River (hereinafter the "Outfall Lines") and the Effluent Pipeline. Such
Effluent delivered by Tolleson and accepted by The Companies at the Delivery
Point shall be deemed "delivered into the Effluent Pipeline" as that phrase is
used in this Agreement.
5.2 Within one year after the execution of this contract, The
Companies shall design and construct a modification to the existing
Interconnection Facilities between the Outfall Lines and the Effluent Pipeline
to allow delivery by Tolleson into the Effluent Pipeline of at least 21 M.G.D.
of Surplus Effluent. All costs associated with the design, construction,
operation and maintenance of this modification shall be borne by The Companies,
and title to the modified Interconnection Facilities shall be vested consistent
with the provisions of Exhibit C, which identifies specific components of the
Interconnection Facilities and the Party or Parties in which title to each such
component is vested. The Companies shall be responsible for, and the Parties
shall cooperate as necessary, to ensure the timely design, construction,
operation and maintenance of the existing and modified Interconnection
Facilities required by this Section and to ensure that such activities do not
interfere with the operation of the Plant or the Effluent Pipeline. If The
Companies cease using the Interconnection Facilities for acceptance of Effluent
from Tolleson, The Companies shall either continue to operate and maintain the
Interconnection Facilities to ensure that operation of the Plant will not be
adversely affected, or shall offer to transfer to Tolleson title over any
portion of the Interconnection Facilities that is necessary to the operation of
the Plant, provided, however, that if Tolleson refuses to accept such
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title, The Companies shall have no obligation to continue to operate or maintain
the Interconnection Facilities.
5.3 The quantity of Effluent delivered by Tolleson and accepted by
The Companies at the Delivery Point shall be measured by metering devices
installed by The Companies as close to the Delivery Point as practicable. The
quantity of Effluent supplied by Tolleson and accepted by The Companies for use
at or for the benefit of Other Electrical Generating Facilities shall be
measured by a metering device installed by The Companies at a point which will
measure the amount of Effluent that is used at or for the benefit of Other
Electrical Generating Facilities. Such metering devices shall be of a design and
type acceptable to Tolleson and The Companies. The costs of such devices and
their installation, operation, maintenance, replacements, repair, betterments
and calibration shall be borne by The Companies, except as otherwise provided in
Section 7.2 hereof, and the title thereto shall be vested in The Companies.
Provisions shall be made to permit flow meter information to be continuously
displayed in a panel or panels at the Plant utilizing facilities and equipment
as Tolleson may, at its own expense provide, title to which shall be vested in
Tolleson.
5.4 In the event that the flow metering device measuring flows of
Tolleson Effluent into the Effluent Pipeline shall fail or be inoperative,
Tolleson shall have the right to use other in-Plant flow metering equipment to
determine the volume of Effluent delivered for billing purposes.
5.5 If Tolleson concludes that increases in capacity of the Plant
beyond 21 M.G.D. are necessary or desirable, the Parties shall meet, upon
request by Tolleson, to discuss potential additional modifications of the
Interconnection Facilities beyond those required by Section 5.2 above. Any terms
for the design and construction of, and payment for, additional modifications,
and any terms for the purchase and sale of any Effluent made available by an
increase in the capacity of the Interconnection Facilities beyond 21 M.G.D.,
shall be established by mutual agreement of the Parties at that time.
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SECTION 6. PERMITS AND AUTHORIZATIONS.
6.1 Tolleson shall be solely responsible for securing and
maintaining in force and effect any and all permits and authorizations required
by law for the delivery of Effluent to The Companies at the Delivery Point and
for the discharge into the Salt River or other disposal of Effluent which is not
delivered to and accepted by The Companies.
6.2 The Companies shall be solely responsible for securing and
maintaining in force and effect any and all permits and authorizations required
by law for the transportation of the Effluent from the Delivery Point to Palo
Verde or to any other points and for any uses of the Effluent that are allowed
by Section 4 of this Agreement. Such responsibility of The Companies may be
delegated to others, but as between the Parties the responsibility rests solely
upon The Companies.
6.3 Each of the Parties shall cooperate with the other Parties in
securing and maintaining in force and effect the permits and authorizations
required in accordance with this Agreement or by local, state or federal laws
and regulations and shall render such assistance to the other Parties as it or
they may reasonably request. Each Party shall furnish to the other Parties a
copy of each permit and authorization obtained pursuant to Sections 6.1 and 6.2
hereof.
6.4 Should Tolleson be required by law to treat the Effluent in a
manner that results in increased expenses to Tolleson because it is delivering
the Effluent to The Companies under this Agreement, which expense it would not
have incurred if the Effluent was disposed by Tolleson into the Salt River, then
The Companies shall have the right to require Tolleson to so treat the Effluent
and shall reimburse Tolleson for all reasonable expenses (including without
limitation any costs of plant additions or improvements) incurred by Tolleson in
providing such treatment. If The Companies, in their sole discretion, decide not
to exercise their right under this Section to require additional treatment, they
may take other action, including terminating this Agreement, to ensure
continuing compliance with applicable law. However, prior to terminating this
Agreement as allowed in the previous sentence, The
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Companies shall meet with Tolleson to discuss any alternatives to termination
that may be available to ensure compliance with applicable law.
SECTION 7. IMPLEMENTATION OF THE AGREEMENT.
7.1 Within 30 days after the effective date of this Agreement,
Tolleson shall designate a representative and The Companies shall jointly
designate a representative for the purposes of: (i) implementing this Agreement
in accordance with its terms, (ii) coordinating the design and construction by
The Companies of the modifications to the Interconnection Facilities required by
Section 5.2 above, (iii) ensuring the continued satisfactory operation and
maintenance of the Interconnection Facilities, and (iv) discussing any issues of
interest or concern to either or both Parties relating to this Agreement. Either
Tolleson or The Companies may from time to time designate a substitute or
successor authorized representative by giving written notice of such designation
to the other party.
7.2 The metering devices used to measure the quantity of Effluent
delivered and accepted hereunder, and the quantity of Effluent used at or for
the benefit of Other Electrical Generating Facilities, shall be calibrated in a
manner acceptable to the authorized representatives prior to the date when such
devices are placed in service and thereafter not less frequently than once every
six months. The costs of such scheduled calibrations shall be borne by The
Companies. The authorized representative for Tolleson may request in writing
such additional calibrations as he in his sole discretion deems appropriate;
provided that the cost incurred by The Companies for each such additional
calibration shall be reimbursed by Tolleson unless any such additional
calibration reveals that the inaccuracy of the metering devices is greater than
(plus/minus) 2% in which case the cost of such additional calibration shall be
borne by The Companies. Copies of all records showing calibration of meters
shall be delivered to Tolleson after each calibration, and copies of all records
of measurements of Effluent supplied to or for the benefit of Palo Verde or
Other Electrical Generating Facilities shall be delivered to Tolleson monthly,
with cover letters acknowledging the records to be true copies.
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SECTION 8. DELIVERY AND ACCEPTANCE OF EFFLUENT.
8.1 The obligation of Tolleson to sell and deliver Surplus Effluent
under this Agreement shall commence on the date this Agreement is executed and
shall continue throughout the term of this Agreement, except as otherwise
provided in this Agreement.
8.2 At any time after the effective date of this Agreement, provided
that the treated wastewater effluent requirements of Palo Verde are being fully
satisfied, The Companies may deliver to Tolleson one or more written notices of
The Companies' commitment ("Notice of Commitment") to purchase up to 13,000
acre-feet of Surplus Effluent for use at or for the benefit of Other Electric
Generating Facilities. The Companies may specify any quantity of Surplus
Effluent in any individual Notice of Commitment, up to the then-operational
maximum capacity of the Interconnection Facilities. The price to be paid for any
Effluent specified in a Notice of Commitment that is actually taken into the
Effluent Pipeline and used at or for the benefit of Other Electric Generating
Facilities shall be as specified in Section 2.2. The price to be paid for any
Effluent specified in a Notice of Commitment that is not actually taken into the
Effluent Pipeline and used at or for the benefit of Other Electric Generating
Facilities shall be as specified in Section 2.5.
8.3 If The Companies have not delivered one or more Notices of
Commitment to purchase at least the following Minimum Quantities of Surplus
Effluent for use at or for the benefit of Other Electric Generating Facilities
on or before the Commitment Dates identified in the following table, Tolleson
may elect to terminate its continuing obligation to sell and deliver any portion
of the corresponding Minimum Quantity of Surplus Effluent for use at or for the
benefit of Palo Verde or Other Electric Generating Facilities that is not yet
subject to a Notice of Commitment:
- 16 -
COMMITMENT DATE MINIMUM QUANTITY
- ----------------- --------------------------------------
December 31, 2002 At least 3,000 acre-feet
December 31, 2003 At least an additional 3,000 acre-feet
December 31, 2005 At least an additional 3,000 acre-feet
December 31, 2007 At least an additional 4,000 acre-feet
For a period of one year following each specified Commitment Date, Tolleson may
terminate its obligation to sell and deliver any portion of the corresponding
Minimum Quantity not yet subject to a Notice of Commitment by delivering to The
Companies one or more written Notices of Intent to Terminate. Each Notice of
Intent to Terminate shall specify the quantity of Surplus Effluent for which
Tolleson has elected to terminate its obligation to sell and deliver to the
Companies for use at or for the benefit of Palo Verde or Other Electric
Generating Facilities. Upon receipt of a Notice of Intent to Terminate, The
Companies shall have ninety days thereafter within which to submit a Notice of
Commitment to Tolleson for the quantity of Surplus Effluent for use at or for
the benefit of Other Electric Generating Facilities specified in the Notice of
Intent to Terminate. If The Companies submit a Notice of Commitment within this
ninety-day period, Tolleson's continuing obligation to sell and deliver Surplus
Effluent to The Companies for use at or for the benefit of Palo Verde or Other
Electric Generating Facilities shall not be terminated. If The Companies do not
submit a Notice of Commitment within this ninety day period, Tolleson's
obligation to sell and deliver the specified quantity of Surplus Effluent for
use at or for the benefit of Palo Verde or Other Electric Generating Facilities
shall be terminated, the specified quantity of Surplus Effluent shall no longer
be eligible for price adjustments pursuant to Sections 2.1, 2.2 or 2.6, and The
Companies shall no longer be obligated to pay, pursuant to Section 2.5, for any
of the specified Surplus Effluent not actually taken into the Pipeline.
Notwithstanding the previous sentence, The Companies may continue to accept into
the Pipeline any or all of the Surplus Effluent specified in the Notice of
Intent to Terminate provided Tolleson desires to continue delivering such
Surplus Effluent, in which event, The Companies shall pay
- 17 -
Tolleson the price for such Surplus Effluent specified in Section 2.1 or Section
2.2, as appropriate.
8.4 Nothing in Sections 8.2 and 8.3 is intended to limit Tolleson's
first right to deliver into the Effluent Pipeline and sell to The Companies
treated wastewater effluent for use at or for the benefit of Other Electric
Generating Facilities as provided in Section 4.2 or to limit the obligation of
The Companies to purchase and accept all of the Surplus Effluent produced
through the operation of the Plant as provided in Section 1.1. To the extent
that The Companies purchase treated wastewater effluent delivered into the
Effluent Pipeline for use at or for the benefit of Other Electric Generating
Facilities, Tolleson shall have the first right to sell such treated wastewater
effluent consistent with the terms of Section 4.2, regardless of whether The
Companies have submitted one or more Notices of Commitment for that amount of
Surplus Effluent.
8.5 The Companies shall have the right to refuse delivery of
Effluent whenever, in their sole and reasonable discretion, use of Effluent
would cause significant operational problems in the Effluent Pipeline, Water
Reclamation Facility or other Palo Verde facilities. However, other than during
an Uncontrollable Force event, as defined in Section 9.1, The Companies shall
pay the price established in Section 2.5 for any Surplus Effluent refused
pursuant to this Section 8.5 that is actually available for delivery to the
Delivery Point and meets the water quality standards of Section 3 of this
Agreement.
SECTION 9. UNCONTROLLABLE FORCE AND OUTAGES.
9.1 Neither Tolleson nor The Companies shall be considered to be in
default in the performance of any of the obligations hereunder if failure of
performance shall be due to an Uncontrollable Force. The term "Uncontrollable
Force" shall mean any cause beyond the control of the Party affected, including,
but not limited to, failure of facilities, flood, earthquake, tornado, storm,
fire, lightning, epidemic, war, riot, civil disturbance or disobedience, labor
dispute, and action or nonaction by or failure to obtain or revocation of the
necessary
- 18 -
authorizations or approvals from any governmental agency or authority or the
electorate, labor or material shortage, sabotage and restraint by Court order or
public authority, which by exercise of due diligence and foresight such Party
could not reasonably have been expected to avoid and which by exercise of due
diligence it shall be unable to overcome. Nothing contained herein shall be
construed so as to require any Party to settle any strike or labor dispute in
which it may be involved. Any Party rendered unable to fulfill any obligation by
reason of any Uncontrollable Force shall exercise due diligence to remove such
inability with all reasonable dispatch.
9.2 Whenever an Uncontrollable Force as defined in Section 9.1
prevents The Companies from being able to accept or use the Surplus Effluent,
then Tolleson may enter into temporary contracts with any other parties for sale
of the Surplus Effluent. If Tolleson has entered into such a temporary contract,
Tolleson shall be allowed up to 30 days to begin delivery of the Surplus
Effluent to The Companies after receiving written notice from The Companies that
the disability has been removed.
9.3 Notwithstanding the provisions of Sections 9.1 and 9.2, if,
after the exercise of due diligence, the Party rendered unable to fulfill an
obligation remains unable to remove such inability for one full year, the other
Party may elect to terminate this Agreement anytime thereafter by tendering 90
days written notice of its intention to terminate. However, if The Companies
receive a written termination notice from Tolleson pursuant to the preceding
sentence, The Companies may elect, at any time prior to the expiration of the 90
days, to begin paying the price established in Section 2.5 for any Surplus
Effluent available for delivery and meeting the water quality standards of
Section 3 of this Agreement, up to the then-operational maximum capacity of the
Interconnection Facilities. As long as The Companies continue the payments
required under this paragraph, this Agreement shall remain in full force and
effect.
9.4 If an Uncontrollable Force or malfunction of any component or
system of the Effluent Pipeline or the Water Reclamation Facility at Palo Verde,
restricts the capability of either of such facilities to transport or treat
wastewater effluent from all sources for a period of one full year or less, then
The Companies may refuse to accept delivery of the Surplus
- 19 -
Effluent and shall not be required to pay therefor. It is understood, however,
that the Surplus Effluent from Tolleson's Plant shall be the last source of
effluent that The Companies cut back on during such Uncontrollable Force or
malfunction and that The Companies shall not refuse to accept and pay for
Tolleson's Surplus Effluent to the extent that they are accepting and paying for
effluent from any other source.
9.5 If The Companies initiate a Scheduled Outage of Palo Verde, the
Effluent Pipeline or the Water Reclamation Facility, The Companies shall pay the
price established in Section 2.5 for any Surplus Effluent available for delivery
and meeting the water quality standards of Section 3 of this Agreement, up to
the then-operational maximum capacity of the Interconnection Facilities. As long
as The Companies continue the payments required under this Section, this
Agreement shall remain in full force and effect. If Tolleson initiates a
Scheduled Outage of the Plant, any obligation that Tolleson may have to supply
Effluent, and the obligation of The Companies to pay the price established under
Section 2.5, shall be suspended during such Scheduled Outage. "Scheduled Outage"
shall mean any temporary cessation of operations that is planned and controlled
by the Party initiating the Scheduled Outage.
9.6 Except in emergencies, The Companies shall give 30 days written
notice in advance of any discontinuation of acceptance of Surplus Effluent under
the provisions of this Section 9. Except in emergencies, Tolleson shall give 30
days written notice in advance of any Scheduled Outage that will limit
Tolleson's ability to supply at least 13,000 acre-feet per year of Surplus
Effluent to The Companies. Tolleson shall use its best efforts to minimize the
duration of any Scheduled Outage that will limit Tolleson's ability to supply at
least 13,000 acre-feet per year of Surplus Effluent to The Companies.
SECTION 10. LIABILITY AND INSURANCE.
10.1 Except for the negligent or intentional acts of The Companies,
their officers, directors, employees and agents, Tolleson shall, to the extent
permitted by law, indemnify and hold The Companies and their officers,
directors, employees and agents harmless
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for any physical damage to property, or death of, or personal injury to, any
person, and from any cost, expense, claim or loss from such damage, injury or
death arising out of the ownership, use, occupancy, operation, maintenance,
repair, replacement and reconstruction of the Plant and the Outfall Lines and
that portion of the Interconnection Facilities owned by Tolleson as specified in
Exhibit B.
10.2 Except for the negligent or intentional acts of Tolleson, its
officers, managers, employees or agents, The Companies shall indemnify and hold
Tolleson and its officers, managers, employees and agents harmless for any
physical damage to property, or death of, or personal injury to, any person, and
from any cost, expense, claim or loss from such damage, injury or death arising
out of the construction, ownership, use, occupancy, operation, maintenance,
repair, replacement and reconstruction of the delivery facilities at the
Delivery Point, that portion of the Interconnection Facilities owned by the
Companies as specified in Exhibit C, the Effluent Pipeline, the facilities at
Palo Verde, or the transportation, use, resale or disposal of Surplus Effluent
delivered and accepted hereunder.
10.3 Tolleson shall procure and maintain insurance against physical
damage to property, or death of, or personal injury to, any persons, of the kind
and with coverages normally carried by entities operating properties similar to
the Plant and the Outfall Lines. Upon request, Tolleson shall furnish to The
Companies certificates of insurance demonstrating compliance with this Section
10.3.
10.4 The Companies shall procure and maintain insurance against
physical damage to property, or death of, or personal injury to, any persons, of
the kind and with coverages normally carried by entities operating properties
similar to the Effluent Pipeline and Palo Verde. Upon request, The Companies
shall furnish to Tolleson certificates of insurance demonstrating compliance
with this Section 10.4.
- 21 -
SECTION 11. INSPECTIONS AND ACCESS TO RECORDS.
11.1 Each of the Parties shall have the right, during reasonable
hours, of access to and inspection of the facilities and operations of the other
Parties which are associated with the treatment, delivery, measurement,
transportation and use of Effluent sold and purchased hereunder.
11.2 Each of the Parties shall have the right, during reasonable
hours, of access to the records of the other Parties which are relevant for
proving compliance or noncompliance of each of the Parties with any of the terms
of this Agreement.
SECTION 12. GENERAL.
12.1 Effective Date and Term. This Agreement shall be effective from
and after the date of its execution by the parties and shall expire on December
31, 2050, unless partially or fully terminated before that date under the
provisions of Sections 2.1, 6.4, 8.3, 9.3 or 12.3.1.
12.2 Assignment of Agreement or Transfer of Facilities.
12.2.1 Neither Tolleson nor The Companies shall transfer or assign
any of their respective rights, titles and interests in and to this Agreement
without the prior written consent of the other Parties, except that: (i) The
Companies and any of their affiliates, successors or assigns shall each have the
right to transfer and assign all or any portion of its right, title and interest
in this Agreement to the other, to any related corporate entity, or to any other
entity now or hereafter participating in Palo Verde or any Other Electric
Generating Facilities which utilize the Surplus Effluent sold hereunder,
provided that such entity expressly assumes the obligations of the respective
Company, as applicable, under this Agreement; and (ii) either Company, and any
of its respective affiliates, successors or assigns shall have the right to
transfer its right, title and interest in this Agreement to any mortgagee,
trustee or secured party under present or future deeds of trust, mortgages,
indentures or security agreements. A transfer or assignment by any Party shall
not release that party from its obligations as the primary obligor under the
Agreement
- 22 -
without the written consent of the other Parties. In the event of any transfer
or assignment of this Agreement by either Tolleson or The Companies, the terms,
covenants and conditions of this Agreement shall be binding upon and inure to
the benefit of and shall apply to the respective transferees, successors and
assigns of Tolleson and The Companies.
12.2.2 The Companies shall not convey Palo Verde or any interest
therein without the grantee of such conveyance expressly agreeing to be bound by
all terms of this Agreement, unless The Company that conveys its interest in
Palo Verde expressly agrees to continue to be bound by all terms of this
Agreement. Tolleson shall not convey the Plant or any interest therein, without
the grantee of such conveyance expressly agreeing to be bound by all terms of
this Agreement.
12.3 Compliance with Laws.
12.3.1 The Companies shall use the Effluent delivered hereunder in
accordance with the applicable laws of the United States of America, the
applicable laws of the State of Arizona and the rules and regulations of
federal, state and local agencies; provided, however, that in the event any such
laws or regulations shall be amended in the future so as to make it impossible
or uneconomical to use the Effluent for the purposes specified in this
Agreement, The Companies shall, at their option, have the right to cancel and
terminate this Agreement upon giving 90 days notice in writing to Tolleson. In
the event Tolleson is prohibited by any state or federal laws or regulations
from selling Effluent for the uses contemplated herein, Tolleson shall have the
right to cancel and terminate this Agreement upon giving 90 days notice in
writing to The Companies. Until the notice period runs and the termination
becomes effective, The Companies shall continue to pay for the Surplus Effluent
pursuant to Section 2.5, except as otherwise specified in this Agreement.
12.3.2 If any proceeding in law or equity is instituted challenging
the authority and power of Tolleson and/or The Companies to make, execute and
deliver this Agreement and/or to perform its terms, covenants and conditions, or
relating to the rights, title and interest of Tolleson or The Companies in and
to the Effluent, then Tolleson and The
- 23 -
Companies shall jointly and cooperatively defend the validity of this Agreement
and the sale, delivery and uses of Effluent contemplated herein.
12.3.3 The Parties acknowledge that this Agreement is subject to the
provisions of Arizona Revised Statutes Section 38-511, and can be cancelled
within three years after its execution by Tolleson if any person significantly
involved in initiating, negotiating, securing, drafting or creating this
Agreement on behalf of Tolleson is, while this Agreement is in effect during
that three year period, an employee or agent of or consultant to any other Party
to this Agreement.
12.4 Notices. All notices, demands, consents or other writings given
or made pursuant to this Agreement shall be in writing and, unless otherwise
specified herein, shall be deemed to have been duly given when made and
deposited in the United States mail by registered or certified mail with postage
prepaid and addressed as follows:
To Tolleson: City Manager
9555 West Van Buren
Tolleson, Arizona 85353
To APS: Arizona Public Service Company
Palo Verde Nuclear Generating Station
WRF Manager
Mail Station 6215
P. O. Box 52034
Phoenix, Arizona 85072-2034
To SRP: Salt River Project Agricultural
Improvement and Power District
c/o Secretary
P. O. Box 52025
Phoenix, Arizona 85072-2025
The address to which any notice, demand, consent or other writing shall be given
to any Party may be changed from time to time by written notice of such Party to
the other Parties as above provided.
- 24 -
12.5 Relative Responsibilities and Authority of The Companies.
12.5.1 APS, or any of its affiliates, successors or assigns acting
as Operating Agent of Palo Verde, is authorized to act for and on behalf of SRP
in all matters affecting the implementation and performance of this Agreement
for the use of Effluent at Palo Verde, and all actions and representations taken
or made by APS in the implementation and performance of this Agreement shall be
binding upon SRP.
12.5.2 In the event all or part of the Effluent is used other than
at Palo Verde, The Companies shall be jointly responsible for implementation and
performance of this Agreement.
12.5.3 The Companies shall be jointly and severally liable to
perform the obligations to Tolleson that are imposed by this Agreement.
12.5.4 The Companies represent that they have the authority to enter
into and carry out all obligations to Tolleson under this Agreement.
12.6 Waivers. The waiver by either Tolleson or The Companies of any
breach of any term, covenant or condition of this Agreement shall not be deemed
a waiver of such term, covenant or condition or of any subsequent breach thereof
or a subsequent breach of any other term, covenant or condition in this
Agreement.
12.7 Resolution of Conflicts and Disputes. Any conflict or disputes
in: (i) the implementation of this Agreement provided in Section 7, or (ii) the
quantity or quality of Surplus Effluent delivered as discussed in Section 2.4,
shall be resolved by arbitration in accord with the rules of the American
Arbitration Association. No other conflicts or disputes arising out of the
Agreement shall be subject to mandatory arbitration. In all cases, the Agreement
shall be interpreted according to the laws of the State of Arizona.
12.8 Sales and Use Taxes. In the event the State of Arizona, County
of Maricopa or the federal government should require that Tolleson pay a tax
resulting from the sale of Effluent to The Companies, then the price for the
Effluent shall be increased by the amount of such tax. In the event Tolleson
shall levy a tax on the sale or use of the Effluent, then the
- 25 -
amounts of any such tax paid by The Companies shall be deducted from the amounts
payable under Sections 2.1 or 2.2 hereof.
12.9 Section Headings. Section headings in this Agreement are for
convenience only and do not purport to describe accurately or completely the
contents of any section. Such headings are not to be construed as a part of this
Agreement or as in any way defining, limiting or amplifying the provisions
hereof.
12.10 Severability. If any term or provision of this Agreement is
held to be void, invalid or unenforceable by a court of competent jurisdiction,
that term or provision shall be severable from the remainder of this Agreement
and shall not affect or render invalid, void or unenforceable any other
provision or term of this Agreement.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
and attested by their respective duly authorized officers as of the date first
above written.
ATTEST: CITY OF TOLLESON
/s/ Rosemarie Martinez Booth By /s/ Adolfo F. Gamez
_______________________________ ____________________________________
City Clerk Mayor
Reviewed By
/s/ Ralph Velez
_________________________________
City Manager
Approved as to Form
/s/ Scott W. Ruby
_________________________________
City Attorney
- 26 -
ATTEST: ARIZONA PUBLIC SERVICE COMPANY
/s/ Betsy A. Pregulman By /s/ James M. Levine
_______________________________ ____________________________________
(Title) (Title)
Associate Secretary Executive Vice President,
Generation
ATTEST & COUNTERSIGN. SALT RIVER PROJECT
AGRICULTURAL IMPROVEMENT
AND POWER DISTRICT
/s/ Terri A. Lonon By William P. Schrader
_______________________________ ____________________________________
(Title) (Title)
Corporate Secretary President
- 27 -
EXHIBIT A
The following formula shall be used to adjust the prices of Effluent established
in Sections 2.1 and 2.2 of the Agreement:
Formula: Pp (1 + A) = Pc
Where: Pp Previous year's price
A= The average of the previous 5 years' annual
percent change (ending in Dec) of the Consumer
Price Index for Urban Consumers (CPI-U),
Expenditure Category "All Items" (as published
by the Bureau of Labor Statistics).
Pc = New or Current year's price
This adjustment to the prices paid to the City for Effluent will be made each
calendar year, effective in January, using the most recent CPI-U data available.
This method of price adjustment will be used throughout the term of this
Agreement.
Example of price adjustment using the above formula:
Pp (1 +A) = Pc
Where: Pp = $30/AF (previous year's price)
A = 2.5%(1995 CPI)+3.3%(1996)+1.7%(1997)+1.6%(1998)+2.7%(1999)
----------------------------------------------------------
5
A = 11.8%
-----
5
A = 2.4% (most recent 5 year CPI-U average)
$30.00 (1 +.024) = Pc = $30.72 (New or Current Year Price)
Each subsequent year, Pc will become the most recent previous year's price (Pp)
for calculating the next year's price. "A", which is a "rolling five-year
average", will be comprised of the average of the most recent five-years' annual
CPI-U percentage changes.
Example for year #2:
Pp (1+A) = Pc
Where: Pp = $30.72
A = 3.3% + 1.7% + 1.6% + 2.7% + 3.0% [assumed]
--------------------------------
5
A = 2.5%
$30.72 (1.025) = Pc = $31.49 (New or Current Year Price)
EXHIBIT B
The following legal description, as depicted on the attached map, describes the
area within which Other Electric Generating Facilities are subject to the
"physically capable of being economically served by Tolleson Effluent delivered
into the Effluent Pipeline" standard established in Sections 2.6 and 4.2 of the
"Agreement for the Sale and Purchase of Wastewater Effluent" to which this
Exhibit B is attached:
BEGINNING AT THE NORTH QUARTER CORNER OF SECTION 24, TOWNSHIP 1 NORTH, RANGE 6
WEST;
THENCE WEST ALONG THE NORTH LINE OF SAID SECTION 24 AND ALONG THE NORTH LINE OF
SECTIONS 23, 22 AND 21, TOWNSHIP 1 NORTH, RANGE 6 WEST APPROXIMATELY THREE MILES
TO THE NORTH QUARTER CORNER OF SAID SECTION 21;
THENCE SOUTH ALONG THE NORTH SOUTH MID-SECTION LINE OF SAID SECTION 21
APPROXIMATELY ONE HALF MILE TO THE APPROXIMATE CENTER OF SAID SECTION 21;
THENCE WEST ALONG THE EAST WEST MID-SECTION LINE OF SAID SECTION 21 AND SECTION
20, TOWNSHIP 1 NORTH, RANGE 6 WEST, APPROXIMATELY ONE MILE TO THE APPROXIMATE
CENTER OF SAID SECTION 20;
THENCE SOUTH ALONG THE NORTH-SOUTH MID-SECTION LINE OF SECTIONS 20, 29 AND 32,
TOWNSHIP 1 NORTH, RANGE 6 WEST APPROXIMATELY TWO AND ONE HALF MILES TO THE SOUTH
QUARTER CORNER OF SAID SECTION 32, WHICH IS COINCIDENT WITH THE NORTH QUARTER
CORNER OF SECTION 5, TOWNSHIP 1 SOUTH, RANGE 6 WEST;
THENCE WEST ALONG THE NORTH LINE OF SECTIONS 5 AND 6, TOWNSHIP 1 SOUTH, RANGE 6
WEST, AND ALONG THE NORTH LINE OF SECTION 1, TOWNSHIP 1 SOUTH, RANGE 7 WEST
APPROXIMATELY TWO AND ONE HALF MILES TO THE NORTHWEST CORNER OF SECTION 1,
TOWNSHIP 1 SOUTH, RANGE 7 WEST;
THENCE SOUTH ALONG THE WEST LINE OF SAID SECTION 1, APPROXIMATELY ONE MILE TO
THE SOUTHWEST CORNER OF SAID SECTION 1 WHICH IS COINCIDENT WITH THE NORTHEAST
CORNER OF SECTION 11, TOWNSHIP I SOUTH RANGE 7 WEST;
THENCE WEST ALONG THE NORTH LINE OF SAID SECTION 11 APPROXIMATELY ONE MILE TO
THE NORTHWEST CORNER OF SECTION 11, TOWNSHIP 1 SOUTH, RANGE 7 WEST;
THENCE SOUTH APPROXIMATELY 4 MILES ALONG THE WEST LINE OF SAID SECTION 11 AND
THE WEST LINE OF SECTIONS 14, 23, AND 26, TOWNSHIP 1 SOUTH, RANGE 7 WEST TO THE
SOUTHWEST CORNER OF SAID SECTION 26;
THENCE EAST APPROXIMATELY ONE AND ONE HALF MILES ALONG THE SOUTH LINE OF SAID
SECTION 26 AND THE SOUTH LINE OF SECTION 25, TOWNSHIP 1 SOUTH, RANGE 7 WEST TO
THE SOUTH QUARTER CORNER OF SAID SECTION 25, WHICH IS COINCIDENT WITH THE NORTH
QUARTER CORNER OF SECTION 36, TOWNSHIP 1 SOUTH, RANGE 7 WEST;
THENCE SOUTH ALONG THE NORTH SOUTH MID-SECTION LINE OF SECTION 36, TOWNSHIP 1
SOUTH, RANGE 7 WEST APPROXIMATELY ONE MILE TO THE SOUTH QUARTER CORNER OF SAID
SECTION 36;
THENCE EAST APPROXIMATELY 4 AND ONE HALF MILES ALONG THE SOUTH LINE OF SAID
SECTION 36, TOWNSHIP 1 SOUTH, RANGE 7 WEST AND THE SOUTH LINE OF SECTIONS 31,
32, 33 AND 34, TOWNSHIP 1 SOUTH, RANGE 6 WEST TO THE SOUTHEAST CORNER OF SAID
SECTION 34, WHICH IS COINCIDENT WITH THE NORTHWEST CORNER OF SECTION 2, TOWNSHIP
2 SOUTH, RANGE 6 WEST; THENCE SOUTH ALONG THE WEST LINE OF SAID SECTION 2
APPROXIMATELY ONE HALF MILE TO THE WEST QUARTER CORNER OF SAID SECTION 2;
THENCE EAST APPROXIMATELY ONE MILE ALONG THE EAST WEST MIDSECTION LINE OF SAID
SECTION 2 TO THE EAST QUARTER CORNER OF SAID SECTION 2, WHICH IS COINCIDENT WITH
THE WEST QUARTER CORNER OF SECTION 1, TOWNSHIP 2 SOUTH, RANGE 6 WEST;
THENCE SOUTH APPROXIMATELY ONE HALF MILE ALONG THE WEST LINE OF SAID SECTION 1
TO THE SOUTHWEST CORNER OF SAID SECTION 1;
THENCE EAST ALONG THE SOUTH LINE OF SAID SECTION 1 AND THE SOUTH LINE OF SECTION
6, TOWNSHIP 2 SOUTH, RANGE 5 WEST, APPROXIMATELY 2 MILES TO THE SOUTHEAST CORNER
OF SAID SECTION 6;
THENCE NORTH APPROXIMATELY THREE MILES ALONG THE EAST LINE OF SAID SECTION 6 AND
THE EAST LINE OF SECTIONS 31 AND 30, TOWNSHIP 1 SOUTH, RANGE 5 WEST TO THE
NORTHEAST CORNER OF SAID SECTION 30;
THENCE WEST APPROXIMATELY ONE HALF MILE ALONG THE NORTH LINE OF SAID SECTION 30
TO THE NORTH QUARTER CORNER OF SAID SECTION 30, WHICH IS COINCIDENT WITH THE
SOUTH QUARTER CORNER OF SECTION 19, TOWNSHIP 1 SOUTH, RANGE 5 WEST;
THENCE NORTH APPROXIMATELY ONE MILE ALONG THE NORTH SOUTH MID-SECTION LINE OF
SAID SECTION 19 TO THE NORTH QUARTER CORNER OF SAID SECTION 19;
THENCE WEST APPROXIMATELY ONE HALF MILE ALONG THE NORTH LINE OF SAID SECTION 19
TO THE NORTHWEST CORNER OF SAID SECTION 19, WHICH IS COINCIDENT WITH THE
SOUTHEAST CORNER OF SECTION 13, TOWNSHIP 1 SOUTH, RANGE 6 WEST;
THENCE NORTH APPROXIMATELY TWO MILES ALONG THE EAST LINE OF SECTIONS 13 AND 12
TOWNSHIP 1 SOUTH, RANGE 6 WEST TO THE NORTHEAST CORNER OF SAID SECTION 12;
THENCE WEST APPROXIMATELY ONE HALF MILE TO THE NORTH QUARTER CORNER OF SAID
SECTION 12, WHICH IS COINCIDENT WITH THE SOUTH QUARTER CORNER OF SECTION 1,
TOWNSHIP 1 SOUTH, RANGE 6 WEST;
THENCE NORTH APPROXIMATELY FOUR MILES ALONG THE NORTH SOUTH MID-SECTION LINE OF
SAID SECTION 1 AND THE NORTH SOUTH MIDSECTION LINE OF SECTIONS 36, 25 AND 24,
TOWNSHIP 1 NORTH, RANGE 6 WEST TO THE POINT OF BEGINNING.
ALL LYING WITHIN THE GILA AND SALT RIVER BASE AND MERIDIAN, MARICOPA COUNTY,
ARIZONA
In accordance with Item 304 of Regulation S-T of the Securities Exchange
Act of 1934, the map on this page of this Agreement shows the Other Electric
Generating Facilities that could be served by Tolleson Effluent under this
Agreement.
EXHIBIT C
The following components of the Interconnection Facilities, as depicted on
drawing Numbers AO-W-Z1C-150, Rev. 7, and AO-W-Z1C-151, Rev. 3 (both drawings
attached), are the property of the City of Tolleson:
1. The Tolleson Junction Box and the weir and three manual sluice gates
located within that Junction Box.
2. The anchor block adjacent to the Tolleson Junction Box.
3. 18 feet of 48-inch pipe connected to the inlet side of the Tolleson
Junction Box.
4. Approximately 15 feet of 42-inch pipe connected to the outlet side of the
Tolleson Junction Box.
5. The manhole and stub pipe required to connect the 42-inch pipes connected
to the inlet and outlet sides of the manhole.
6. The Tolleson Junction Structure Box.
7. All other portions of the "new" Tolleson Outfall Line.
8. The portion of the existing Tolleson Outfall Line (30-inch) within the
Tolleson Junction Box.
9. All other portions of the existing Tolleson Outfall Line.
The following components of the Interconnection Facilities, as depicted on
drawing Numbers AO-W-Z1C-150, Rev. 7, and AO-W-Z1C-151, Rev. 3 (both drawings
attached), are the property of APS, SRP and the other owners of Palo Verde
Nuclear Generating Station:
1. The ANPP Effluent Pipeline Junction Box and all facilities and equipment
located within that Junction Box.
2. The 30-inch pipe between the Palo Verde Effluent Pipeline Junction Box and
the Tolleson Junction Box.
3. The motorized sluice gate (valve) situated in the Tolleson Junction Box.
4. The flow metering equipment, including without limitations such devices as
may be necessary for transmission of flow meter data to the control panels
in the Plant.
5. The RTU Building and all facilities and equipment located within that
building.
In accordance with Item 304 of Regulation S-T of the Securities Exchange
Act of 1934, the drawings on these two pages of this Agreement show the
Interconnection Facilities owned by Palo Verde and the City of Tolleson.