South Metro WISE Authority Formation and Organizational Intergovernmental Agreement, dated December 31, 2013

 

---

---

 

 

    WHEREAS, the Members, individually and collectively, hereby find and declare:

 

 

        (a)    Water is essential to the economy of the State of Colorado,  Douglas County, Arapahoe County, and the Members; and 

 

        (b)        The naturally-occurring water in the Denver Basin aquifers is a limited resource; and

 

        (c)          Concerns about the continued availability of water have severe and adverse impacts on the economy of the south Denver metropolitan community, region, and state; and

 

    WHEREAS, Denver Water and Aurora Water (both defined below) have been negotiating with the Members for  the delivery of water pursuant to the WISE Delivery Agreement (defined below); and

 

    WHEREAS, the Members, Denver Water, and Aurora Water have reached an agreement that would provide 7,225 acre-feet per year, on average, to the Members; and

 

    WHEREAS, the WISE Project (defined below) is a regional project with broad support from elected officials, water providers, and the general public; and

 

    WHEREAS, the WISE Project allows for regional cooperation to help maximize the use of the water resources available to the Members; and

 

    WHEREAS, the Members executed that certain "South Metro Water Supply Authority ­ WISE Negotiations and Cost Sharing Participation Agreement" dated effective January 1, 2012, as amended ("Cost Sharing PA"); and

 

    WHEREAS, the Members desire to form the Authority (defined below) as a necessary step to implementation of the WISE Project; and

 

    WHEREAS, the Members shall have rights in and obligations to the South Metro WISE Authority and the WISE Project as set forth herein; and

 

 

   WHEREAS, the First Amended and Restated South Metro Water Supply Authority Intergovernmental Agreement ("SMW IGA") dated effective January 1, 2006, is the governing intergovernmental agreement of the South Metro Water Supply Authority; and

 

   WHEREAS, Section 110 of the SMW IGA anticipates the creation of Participation Agreements used to pursue specific projects and that such Participation Agreements may create separate legal entities; and

 

   WHEREAS, the Members desire that Douglas County and/or other eligible entities have the opportunity to join the South Metro WISE Authority and to be eligible to receive water from the WISE Project, when, inter alia, water in excess of the Delivery Obligation is available or a portion of the Delivery Obligation becomes available pursuant to this Agreement; and

 

   WHEREAS, the Members intend that the benefits  and obligations set forth in this Agreement shall be perpetual, shall not be subject to annual appropriation, shall not be a "multiple-fiscal year direct or indirect ... debt or other financial obligation" subject to TABOR, and shall not be "general obligation" debt subject to Section 6 of Article XII of the Colorado Constitution. The Members further intend that they shall each be bound by and subject to the provisions of this Agreement without the need for further or subsequent approval; and

 

   WHEREAS, the Members enter into this Agreement on the belief that it is in the best interests of their respective customers and constituents.

 

   NOW THEREFORE, in consideration of the terms and conditions of this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Members agree as follows:

 

 

A.

There is hereby created the South Metro WISE Authority for the purpose of implementing the WISE Project. The Authority shall be a body corporate and politic and a political subdivision of the state, separate from the Members. The Authority is a water  authority as defined in section 29-1-204.2, C.R.S. The Authority shall be an enterprise as defined in sections 24-77-102(3) and 37-45.1- 101 et seq., C.R.S. and the Executive Board shall take such actions as may be required to prevent disqualification as an enterprise.

 

B.

The Authority has all of the powers authorized in Section 29-1-204.2, C.R.S. (specifically including subsections (5) and (7) thereof) and granted to such authorities by Colorado law. A copy of Section 29-1-204.2, C.R.S. as it exists on the effective date of this Agreement is attached as Exhibit B hereto. Amendments to such section adopted after the effective date of this Agreement shall apply to the Authority only if the governing bodies of the Members approve an amendment to this Agreement allowing such application or if required by state law.

 

 

C.

Except as specifically provided herein, nothing in this Agreement shall preclude any Member from undertaking any other water project.

 

D.

With full execution of this Agreement by the Members, the Executive Board is authorized and empowered to execute the WISE Delivery Agreement on behalf of the Authority and to take any necessary action on behalf of the Authority to remain in good standing under the WISE Delivery Agreement. This authorization shall not be impaired by any other provision, term or condition of this Agreement.

 

 

A.

Aurora Water shall mean the City of Aurora, Colorado, acting by and through its Utility Enterprise.

 

B.

Authority shall mean the South Metro WISE Authority formed pursuant to this Agreement.

 

C.

Binney Plant Connection shall mean the connection between the Binney Plant and the Westem Line, as described in the WISE Delivery Agreement.

 

D.

Capacity shall mean a Member's right, pursuant to this Agreement, to receive a certain portion of pipeline capacity through the WISE Project, measured in million gallons per day (MGD).

 

E.

Colorado River Cooperative Agreement shall mean the agreement dated May 15, 2012 between Denver Water and various governmental and non-governmental entities located west of the Continental Divide, including, but not limited to, Board of County Commissioners for the Counties of Eagle, Grand and Summit, the Colorado River Water Conservation District, and the Cities of Glenwood Springs and Rifle.

 

F.

Delivery Volume shall mean a specific volume of water measured in terms of acre-feet or million gallons delivered over a specified time period such as a day, a month or a year.

 

G.

Denver Water shall mean the City and County of Denver, Colorado, acting by and through its Board of Water Commissioners.

 

H.

Executive Board shall mean the Executive Board of the Authority as determined pursuant to this Agreement.

 

I.

Executive Director shall mean the Executive Director of the Authority.

 

J.

Infrastructure shall be divided into two separate terms:

 

 

 

1.

Core   WISE   Project   Infrastructure shall  mean  infrastructure  that   is necessary for the functioning of the WISE Project and is defined as such by the Members. For example, Core WISE Project Infrastructure  shall include the Temporary Interconnect, the Binney Plant Connection, and the Western Line. Core WISE Project Infrastructure shall be  constructed or purchased pursuant to this Agreement, the Western Pipeline Agreement or other agreement.

 

2.

Local Infrastructure shall mean infrastructure, not defined as Core WISE Project Infrastructure, that is necessary for one or more Members to receive water from the WISE Project. For example, the Chambers Pipeline is Local Infrastructure, as are connections by Members to the Core WISE Project Infrastructure. Local Infrastructure may be constructed in coordination with Core WISE Project Infrastructure or may be constructed or purchased pursuant to agreement between the Members interested in such infrastructure.

 

O.

O&M shall mean operations and maintenance.

 

P.

Offered Delivery Amount shall mean the volume and flow rate of water offered by Denver Water and Aurora to the Authority at the Delivery Location(s) subject to the delivery volume and flow rate parameters set forth in  WISE Delivery Agreement.

 

Q.

Operational Costs shall mean the actual operational costs associated with the operation of the Core WISE Project Infrastructure, including, but not limited to, electricity, periodic maintenance, personnel, chemicals, etc. as determined by the Executive Board.

 

R.

Overhead Costs shall mean the actual overhead costs associated with the WISE Project incurred by the Authority that include, but are not limited to, the costs of insurance, accounting, legal and administration, as determined by the Executive Board. The Authority shall provide or cause any or all of said services to be provided by employees or independent contractor(s).

 

S.

South Metro Water Supply Authority shall mean the authority formed pursuant the First Amended and Restated South Metro Water Supply Authority Intergovernmental Agreement dated January 1, 2006.

 

T.

Subscription Amounts means the amount of water that a Member has subscribed to pursuant to this Agreement and for which the Member is obligated to pay its Pro Rata Share of the Minimum Payments pursuant to this  Agreement. Subscription Amounts are shown in Exhibit C.

 

U.

TABOR shall mean the Taxpayer Bill of Rights as set forth in Section 20, Article X of the Colorado Constitution.

 

V.

Temporary Interconnect shall mean the initial connection to the Aurora Water treated water system as described in Section 3.2.2 of the WISE Delivery Agreement.

 

W.

Western Pipeline shall mean a pipeline from the Temporary Interconnect (and ultimately the Binney Plant Connection) southerly and then westerly through Douglas County that is anticipated to be either the ECCV Western Pipeline or an alternate western pipeline.

 

X.

WISE Delivery Agreement shall mean the "WISE Partnership - Water Delivery Agreement between Denver Water, the City of Aurora, acting by and through its Utility Enterprise, and the South Metro WISE  Authority"  dated contemporaneously herewith, a copy of which is attached hereto as Exhibit D and incorporated herein.

 

Y.

WISE Project shall mean the project described in the WISE Delivery Agreement and the Core WISE Project Infrastructure.

 

 

    Capitalized terms not defined herein shall have the meaning and definition as set forth in the WISE Delivery Agreement.

 

 

A.

The  initial  Members  of  the  Authority  shall  be  those  parties  executing  this Agreement.

 

B.

Additional  Members  may  be  included  into  the  Authority  upon  satisfying  the following requirements and procedures:

 

1.

To be considered for membership, a prospective member must be (i) a municipal or quasi-municipal water provider or political subdivision of the state of Colorado; and (ii) an enterprise as defined in TABOR.

 

2.

To be considered for membership, a political subdivision must file a written request, approved by the governing body of the political subdivision, with the authority to be included as a Member of the Authority.

 

3.

The Members of the Authority shall hold a hearing on the request at a publicly noticed meeting of the Members.

 

4.

The Members of the Authority may approve, modify, or deny the request and may impose such terms and conditions as the Members deem appropriate to further the Authority=s purposes. The Members shall determine what, if any, contribution will be  required  to  equitably reimburse the Authority for prior costs. Material modifications to the request made by the Members shall be subject to the approval of the requesting political subdivision.

 

5.

To approve the request as filed or as modified, the Members must find that there exists or will exist in the foreseeable future an interrelationship between the Authority and the political  subdivision  requesting membership, that the inclusion of the political subdivision requesting membership will contribute to the fulfillment of the Authority's purposes and such other findings as the Members deem appropriate.

 

6.

Decisions by the Members in this Section 3.B. shall be by weighted majority of Member present at an annual or special meeting of the Members. Each Member shall have one (1) vote for each 100 acre-feet of Subscription Amount (rounded to the nearest whole number).

 

C.

If a Member is dissolved or otherwise ceases to exist, then either (i) the plan for dissolution  shall contain adequate provisions  acceptable to the Authority for the performance of all of such Member=s obligations to the Authority, or (ii) all such obligations shall be fully paid prior to the effective date of dissolution.

 

 

SECTION 4. MANAGEMENT / VOTING / DECISION MAKING

 

A.

Meetings  of  the  Members  of  the  Authority.  At  least  annually, but  as often  as necessary to address items required  under this Agreement  or as desired by  the Members, there shall be a meeting of all Members. At meetings of the Members, each Member shall have one (1) vote. The annual meeting shall be  called by the Executive Director. Special meetings of the  Members  may  be  called by  the Executive  Director  of the Authority,  the President  of the  Executive Board, or three Members and shall be held following no less than 72 hour written notice to all Members. Two-thirds of the Members shall be a quorum for the Members to conduct business. Members shall appoint an  individual and alternate to act as a representative of the Member at such meetings. Representatives of Members shall not  be  required  to be  employees  of  a Member. In the event that there is any question about who is an authorized  representative or alternate of a Member; the Executive Director may require such designation to be in writing.

 

B.

Executive Board. There shall be created an Executive Board for the Authority. The Executive Board shall be made up of five (5) Executive Board Members who each serve two-year terms, except as noted below for initial terms of one-year for two of the Executive Board Members. Terms shall run from annual meeting date to annual meeting date. There shall be no limit on the number of terms that may be served. Candidates for the Executive Board shall be representatives of the Members. No Member shall have more than one Executive Board Member on the Executive Board. Three (3) members of the Executive Board ("Large Executive Board Members") shall be elected from representatives of the three (3) largest Members plus ties ("Large Members"), measured by Subscription Amount.   Two 2) members of the Executive Board ("Small Executive Board Members") shall be elected from representatives of the remaining Members of the Authority who are not Large Members plus ties ("Small Members"). Large Executive Board Members shall be elected at-large by weighted vote of the Large Members present at the annual meeting of the Members. Small Executive Board Members shall be elected at-large by a weighted vote of the Small Members present at the annual meeting of the Members. Each Member shall have one vote for each 100 acre­ feet of Subscription Amount (rounded to the nearest whole number). Each Member shall have its respective weighted vote for each Executive Board position on which they are authorized to vote.   At the first meeting of the Authority immediately following the execution of this Agreement, members of the Executive Board shall be elected as follows:   Position 1 - Large Member Representative (Two-Year Term) Position 2 -Large Member Representative (Two-Year Term) Position 3 -Large Member Representative (One-Year Term) Position 4 - Small Member Representative {Two-Year Term) Position 5 - Small Member Representative (One-Year Term)     Following the end of the first one-year terms, such positions shall thereafter be elected to two-year terms so that in odd numbered years, three positions shall be subject to regular election and in even numbered years, two positions shall be subject to regular election.     Members of the Executive Board shall receive no compensation but may be reimbursed for reasonable and necessary actual expenses incurred in the performance of their official duties as members of the Executive Board.

 

C.

Officers. The Executive Board shall elect a President, Vice President, and Secretary-Treasurer who shall have the duties set forth in the Bylaws, if any have been adopted.

 

 

A

In the event that  additional  Offered  Delivery  Amounts  are available  from  the WISE Project in excess of those set forth in 3.4.3a of the WISE Delivery Agreement ("Excess Deliveries"), current Members shall have a right but not the obligation to take their Pro-Rata Share of Excess Deliveries.

 

B.

If not all Members desire to take their full Pro-Rata Share of the Excess Deliveries, the rights of those Members' desiring to take Excess Deliveries shall be adjusted based on the ratio of their Pro-Rata Shares to  one another. Additionally, a Member may take less than its Pro Rata Share, and in such event, the lower percentage such Member desires to take shall be considered its Pro Rata Share for purposes of determining the rights of the Members to the Excess Deliveries. For example, if three Members desire to take Excess Deliveries and Member 1 has a 10% Pro Rata Share, Member 2 has a 20% Pro Rata Share, and Member 3 has a 10% Pro Rata Share but only desires to use half of its Pro Rata Share, their Pro Rata Shares for purposes of obtaining Excess Deliveries shall be adjusted so that Member 1 has a 10/351h share (28.57%), Member 2 has a 20/35th share (57.14%), and Member 3 has a 5;35th (14.29%) share. For purposes of this paragraph, no Member may allocate any portion of its Pro Rata Share to another Member.

 

C.

In the event that additional water is made available on a continuing basis under the WISE Delivery Agreement thereby increasing the amount of water for which Denver Water and Aurora Water commit to deliver to the Authority during each Ten-Year  Block  ("Additional  Water"),  such  Additional  Water  will  be  made available to the Members in a manner substantially similar to Excess Deliveries as described above.

 

    The Authority will invoice the Members for amounts due under this Agreement. Members shall pay the Authority the amounts due within thirty (30)  days of the  date of the invoice from the Authority. Member's Pro Rata Share of the Overhead Costs will be billed annually and due quarterly pursuant to Section 6.K., above. Failure of a Member to pay the amounts due under this Agreement shall be a breach of this Agreement.

 

SECTION 9. DEFAULT I REMEDIES

 

A.

In the event the Authority or any Party alleges that  either the Authority or any Party is in breach or default of this Agreement, the non-defaulting party shall first notify such defaulting party, the Authority, and other Members in writing of such default and specify the exact nature of the default in such notice ("Default Notice"). Following a Default Notice, the following shall constitute an "Event of Default" under this Agreement:

 

1.

In the case of non-payment of any amounts due under this Agreement, the failure of the defaulting party to pay all amounts due as specified in the Default Notice within five (5) calendar days from receipt of the Default Notice; and

 

2.

Except in the case of non-payment of amounts due under this Agreement, the failure of the defaulting party to cure any non-monetary default described in the Default Notice within thirty (30) calendar days  from receipt of the  Default Notice. Provided, however, (i) if such default is capable of being cured, (ii) the defaulting party commences such cure within said thirty (30) calendar day period,  and (iii) the defaulting party diligently prosecutes such cure to completion, then the defaulting party shall have an additional period of time as is reasonably necessary to cure such non-monetary default; however, in no event shall the period to cure exceed ninety (90) calendar days from the defaulting party's receipt of the Default Notice, unless approved by the Executive Board.

 

B.

Without the need for a Default Notice, the following shall also be deemed an immediate Event of Default: the Member (i) becomes insolvent; (ii) files a voluntary petition in bankruptcy; (iii) is adjudicated bankrupt pursuant to an involuntary petition in bankruptcy; or (iv) has a receiver appointed for it.

 

C.

If an Event of Default occurs under this Agreement, the defaulting party shall be subject to the following:

 

1.

In the event of the failure of a Member to pay amounts due hereunder and for which a deposit is held (e.g., Minimum Payments), the Authority may use the funds held in deposit by the Member to pay the amounts due by that Member. Such payment from deposits by the Authority shall not constitute a cure by the defaulting party;

2.

The Executive Board may, in its discretion, interrupt  the Defaulting Party's deliveries from or use of the WISE Project; provided such use shall be reinstated upon a complete cure of the Event of Default if the Defaulting Party retains its rights to its Pro-Rata Share at the time of such cure;

 

3.

A one time late fee of 5% (the "Late Fee") of the amount due shall be imposed upon each monetary Event of Default;

 

4.

Upon a monetary Event of Default, in addition to the Late Fee, all amounts due but unpaid shall be subject to interest at 1.5% per month which amount shall accrue from the date that the payment was originally due;

 

5.

All late fees, additional costs, and other fees imposed on the Members or Authority pursuant to the WISE Delivery Agreement, as the result of a Member's breach of this Agreement, shall be paid by the defaulting Member. The Executive Board may develop and adopt terms for imposing additional fees for breach of this Agreement in the Bylaws.

 

6.

Each Member agrees that the amounts due, but unpaid, under this Agreement shall be deemed a  consensual lien upon each respective Member's rights in the WISE Project and rights under this Agreement. Ifa Member fails to cure amounts due under this Agreement within 180 days from the date at which the amounts were due, then the Authority may (i) foreclose on the Member's rights under this Agreement in the same manner as the foreclosure of a mechanic's lien; (ii) foreclose on the Member's rights under this Agreement pursuant to judicial foreclosure; or (iii) file for declaratory judgment in District Court seeking an assignment and transfer of all rights and interests of the Member under this Agreement to the Authority and/or the other Members and such other relief as may be appropriate.

 

7.

If the amounts due to the Authority are not paid within sixty (60) days of the date of the Default Notice, the Member in default agrees to impose a fee upon all of its customers sufficient to pay the amounts due pursuant to this Agreement. In the event that said Member refuses to impose such fee, the Authority may initiate a District Court action for declaratory judgment and injunction or specific performance imposing such fee upon said Member's customers. The Members agree to cooperate with the Authority in the use of this remedy.

 

8.

The Authority may file suit in the Douglas or Arapahoe County District Court to recover amounts due and seek damages for breach of this Agreement by any Member. By execution of this Agreement, upon service of process of a suit to recover amounts due and seek damages for a breach of this Agreement, each Member shall be deemed to have confessed judgment in favor of the Authority for all amounts due pursuant to the Minimum Payment Obligations provisions in Section 6.A.1. of the Agreement. Such confession of judgment shall include  reasonable attorney's fees and costs seeking entry of this judgment and pre- and post­ judgment  interest on the amounts due at the rates set forth herein.

 

9.

In the event of a breach of any provision of this Agreement, in addition to all contractual remedies, any non-defaulting Party to this Agreement may seek, from the Douglas or Arapahoe County District Court, temporary and/or permanent restraining orders, orders of  specific performance, or other equitable relief to compel the defaulting Party to perform in accordance with the terms and obligations set forth under this Agreement.

 

10.

Any defaulting Member shall remain obligated to pay its Pro Rata Share of the Minimum Payment despite any temporary reduction in the Minimum Payment under  the  WISE  Delivery  Agreement. Notwithstanding the foregoing, the Executive Board may, but is not obligated to, agree to an equitable adjustment of amounts due pursuant to the defaulting Member's Pro Rata Share of the Minimum Payment.

 

11.

All remedies set forth in this Agreement shall be cumulative and not exclusive.

 

D.

The pursuit or non-pursuit of the various remedies provided herein  shall  not relieve any Member from making payments required in  this  Agreement, including, but not limited to, the Subscription Fee, Take-or-Pay Payments, Core WISE Infrastructure costs, etc.

 

E.

In the event that a defaulting Member does not or can not be required to cure its default under this Agreement and the defaulting Member is relieved of any or all of its obligations hereunder by a court of competent jurisdiction, then the defaulting Member shall forfeit to the Authority all of its rights, title, interest, and capacity as a Member in the WISE Project under this Agreement.

 

 

    Without relieving Members of the obligation to pay amounts billed as part of ongoing operations hereunder and without limiting the Executive Board's and/or the Authority's right to pursue remedies under Section 9, in the event of a dispute about the amounts due or over any provisions of this Agreement, any Member or the Authority may file a written appeal concerning such dispute to the Executive Board. Within thirty (30) calendar days following the receipt of a written appeal and after written notice to the parties in dispute, the Executive Board shall hold a hearing and provide the parties in dispute with an opportunity to be heard. The Executive Board member(s) representing any party in dispute shall not participate. The Executive Board, by majority vote of all eligible members, shall provide a written decision within 15 days following the hearing. If,after the decision by the Executive Board, the dispute is not resolved, the decision may be appealed to a neutral mediator (e.g., AAA, JAG, or other entity providing non-judicial resolution) in non-binding mediation. Non-binding mediation shall take place within forty-five (45) calendar days following the decision of the Executive Board. If, after a decision by the neutral mediator or expiration of the forty-five (45) calendar days, the dispute is not resolved, any of the parties may seek judicial resolution by filing an action in the Douglas or Arapahoe County District Court.

 

    Core WISE Project Infrastructure and Local Infrastructure and associated real property interests may be held in the name of the Authority or in one or more Members. The Executive Board shall determine ownership with respect to Core WISE Project Infrastructure and the participating Members shall determine ownership with respect to Local Infrastructure pursuant to separate agreement. Notwithstanding the foregoing, this Section does not address right of use or ownership of capacity in Core WISE Project Infrastructure and Local Infrastructure each of which shall be addressed inone or more separate agreements.

 

SECTION 13. WISE DELIVERY AGREEMENT AND CRCA PROVISIONS

 

    Pursuant to the WISE Delivery Agreement, the Members acknowledge: (i) that they can not rely upon the WISE Deliveries as their sole source of water; (ii) that the water being made available under the WISE Delivery Agreement is permanent, variable, and interruptible pursuant to the terms of the WISE Delivery Agreement; and (iii) the need to maintain existing water supplies, develop new water supplies, or have adequate storage available to meet their demands when WISE deliveries are interrupted under the terms of the WISE Delivery Agreement. The Members further acknowledge and agree to abide by the following provisions of the CRCA.

 

A.

West Slope Charge. Pursuant to the WISE Delivery Agreement, the Authority and the Members are obligated to pay amounts set forth in the West Slope Charge Agreement. The West Slope Charge is included in the rates described in and set pursuant to the WISE Delivery Agreement.

 

B.

All Members also agree to:

 

1.

Abstain permanently from pursuing or participating in any project that would result in any new depletion from the Colorado River and its tributaries above  the confluence with the Gunnison River, including without limitation the Eagle River (with the exception of the Eagle River MOU for Aurora and the Upper Colorado Cooperative Project). Pursuing or participating in a project means seeking formal approval of any aspect of a project in a regulatory or judicial forum, but does not include conducting various planning activities such as feasibility studies.

 

2.

Abstain from pursuing or participating in any project that would result in diversions from the Colorado River Basin within Water Divisions Nos. 4 and 6, or downstream from the confluence of the Gunnison and Colorado Rivers in Water Division No. 5 for a period of 25 years. Pursuing or participating in a project means seeking formal approval of any aspect of a project in a regulatory or judicial forum, but does not include conducting various planning activities such as feasibility studies. This abstention period would be reduced to 15 years if, within the first 10 years following execution of this agreement, the NEPA permitting process for the Upper Colorado Cooperative Project has not been initiated. If construction of a cooperative project commences within  20 years from the date of this agreement, then the abstention period under this paragraph would be extended for an additional IO years (a total of 35 years).

 

3.

No later than June 1, 2016, Members agree to adopt and implement a conservation plan that would achieve results similar or proportionately the same as Denver Water's.

 

    It is also acknowledged that upon withdrawal  of a Member,  as set forth herein, the provisions of the CRCA shall no longer apply to such Member.

 

 

 

A.

A Member's rights under this Agreement may be assigned and/or sold, but only according the provisions of this Section.

 

B.

In no event shall a Member sell, assign, or convey its rights in the WISE Project to an entity that is not (i) a municipal  or quasi-municipal water provider  or political subdivision of the state of Colorado; and (ii) an enterprise as defmed in TABOR. Notwithstanding the following, a Member may assign its right in the WISE Project and rights under this Agreement, in whole or in part, to one or more Members without restriction.

 

C.

If at any time during the term of this Agreement, any Member ("Selling Member") desires to assign or sell its Pro-Rata Share under this Agreement to a non-Member, or any portion thereof, ("Selling Member's Pro-Rata Share") and receives a bona fide offer therefor acceptable to the Selling Member ("Offer"), the other Members, and the Authority itself shall be given written notice of such offer and the terms thereof, together with a copy of the Offer ("Offer Notice"). The other Members, or Authority may each have an opportunity to purchase the Selling Member's Pro-Rata Share, to the extent rights remain available, in the order and on the terms set forth herein.

 

1.

Members: Upon receipt of the Offer Notice, each Member shall have the right to purchase some or all of the Selling Member's Pro-Rata Share described in the Offer Notice upon terms and conditions that are the same as described in the Offer Notice ("Member's Right of First Refusal"). The Members desiring to purchase the Selling Member's Pro-Rata Share shall provide written notice of such desire to the Selling Member, other Members, and the Authority within thirty (30) days receipt of the Offer Notice.   If more than one Member desires to purchase some or all the Selling Member's Pro-Rata Share, the amount of Pro-Rata Share to be purchased by each Member shall be divided between them in any way they mutually agree. Ifthe Members desiring to purchase the Selling Member's Pro-Rata Share cannot mutually agree on the rights to be purchased by each Member within fifteen (15) days following the expiration of the thirty (30) days following the Offer Notice, each Member shall be entitled to purchase that proportion of the Selling Member's Pro-Rata Share which that Member's Pro-Rata Share bears to the total of Pro-Rata Share then owned by the other Members desiring to purchase the Selling Member's Pro-Rata Share.

 

2.

The Authority: Ifthe other Members elect to purchase either none or less than all of the Selling Member's Pro-Rata Share described in the Offer Notice, then the Authority shall have the right to purchase some or all of the Selling Member's Pro-Rata Share not to be purchased by the Other Members upon terms and conditions which are the same as described in the Offer Notice (the "Authority Right of First Refusal"). Within thirty (30) days following the expiration of Other Members Right of First Refusal, the Authority shall give notice to the Selling Member, Members, and Other Members indicating the amount of Pro-Rata Share that the Authority desires to purchase.

 

3.

Non-Member: If the other Members elect to purchase either none or less than all of the Selling Member's Pro-Rata Share described in the Offer Notice; and (ii) the Authority elects to purchase either none or less than all of the remaining Selling Member's Pro-Rata Share described in the Offer Notice, the Selling Member giving the Offer Notice may consummate a third-party transaction for the transfer of the Selling Member's Pro-Rata Share not to be purchased by the entities with Rights of First Refusal, as described above, within one hundred twenty (120) days after expiration of the Authority's Right of First Refusal at a price and on terms and conditions not more favorable than set forth in the Offer Notice. Any proposed transfer of any of the Selling Member Pro-Rata Share which is to close after one (1) calendar year from the expiration of the Other Members Right of First Refusal, shall again be subject to the Right of First Refusal of all of the entities described in this Section and shall require compliance by the Selling Member with the procedures described in this Section.

 

D.

The exercise or non-exercise of the other Members or Authority of their respective Rights of First Refusal pursuant to this Section  shall not  adversely affect any Right of First Refusal with respect to subsequent sales of any Selling Member's Pro-Rata Share.

 

E.

Any party purchasing the Selling Member's Pro-Rata Share shall become a Member, if they are not already a Member, and shall execute this Agreement and be bound by its terms.

 

F.

In the event that a Member merges into or consolidates with another Member or non-Member, the Pro-Rata Share owned by the Member shall remain with the Member and then be owned by the merged or consolidated entity, who shall be bound by the terms of this Agreement. Notwithstanding the foregoing, non­ Members shall have no vote in the affairs of the Authority.

 

G.

Notwithstanding the provisions of this Section, all Members shall have the absolute right to assign their respective Pro-Rata Share and rights under this Agreement to a financing entity at any time after this Agreement is in effect. After such assignment the assignor may continue to discharge any financial obligations under this Agreement on behalf of their respective financing entity. Except for the limited right to obtain a direct assignment of the assignor's interest and the other provisions of this paragraph, the financing entities shall be subject to all rights and obligations of the respective Member under this Agreement. In no event shall the assignment to the financing entity trigger application of the provisions  of the Right of First Refusal set forth in this Section. No financing entity shall have Right of First Refusal, as described in this Section. Notwithstanding the foregoing, financing entities shall have no vote in the affairs of the Authority.

 

 

 

    Upon execution, this Agreement shall supersede and replace the Cost Sharing PA and the Cost Sharing PA shall have no further force or effect.

 

 

    Any Member shall be deemed to have withdrawn from this Agreement and to have terminated its obligations hereunder only upon sale or assignment of all of its Pro-Rata Share and rights under this Agreement.

 

 

A.

Except as applied to any Member(s) in breach of this  Agreement, it is the intention of the Members and the Authority that the provisions of this Agreement shall not be interpreted in such a way to limit or interrupt the use of the WISE Project for its intended purposes.

 

B.

A "deadlock" of the Members, for purposes of this Section, is hereby defined as being a situation in which the Members are so divided respecting decision making under and the management of the WISE Project that the votes required for action by the Members cannot be obtained for a continuous period equal to or exceeding ninety (90) days ("Deadlock Period"). A Deadlock shall be deemed a breach of this Agreement.

 

C.

Upon a Deadlock of the Members, as defmed in this Section 17, each Member shall have the right to file an action with the Douglas or Arapahoe County District Court to (i) ensure that the WISE Project can be used for its intended purposes; (ii) to resolve the issue(s) that have caused the deadlock; and (iii) to seek such other relief as is deemed appropriate by the Court, which may include the appointment of a receiver.

 

    The Members agree that they shall not take any action or fail to take any action that would be a violation of the terms of the WISE Delivery Agreement or cause the Authority to be in breach of the terms of the WISE Delivery Agreement. Use of all water received by Members (or their assignees or Lessees) shall conform with the limitations and obligations set forth in the WISE Delivery Agreement.

 

A.           Term: The term of this Agreement shall be perpetual.

 

B.

Enterprise. By executing this Agreement, each Member represents and warrants that it is acting as an enterprise, as defmed in TABOR. Each Member further affirms and agrees to maintain its enterprise status for the term of this Agreement.

 

 

 

C.

Interpretation. To the greatest extent possible, the terms of this Agreement shall be interpreted so that they do not conflict with the provisions -of the WISE Delivery Agreement.

 

D.

Prevailing Party: In the event of any Gudicial or non-judicial) action or proceeding between Members and/or the Authority to enforce any provision of this Agreement, the losing party, shall pay to the prevailing party all costs and expenses, including without limitations, reasonable attorneys' fees and expenses, incurred in such action or proceeding and in any appeal in connection by such prevailing party. The "prevailing party" shall mean the party who substantially obtains or defeats the relief sought, as the case may be, whether by compromise, settlement or judgment. This Section is intended to be severable from the other provisions of this Agreement, and the prevailing party's rights under this Section shall not merge into any judgment and any judgment shall survive until all such fees and costs have been paid.

 

E.

Notices: All notices, correspondence and other communications required or permitted by this Agreement shall be in writing and may be delivered by one of the following means:

 

1.

In person (by hand delivery or professional messenger service).

 

2.

By first class mail. Any such notice sent by mail shall be deemed to have been duly given and received five (5) business days after the same is mailed within the continental United States.

 

3.

By Express Mail of the U.S. Postal Service or Federal Express or any other courier service guaranteeing overnight delivery. Notices delivered by overnight service shall be deemed to have been given one (1) business day after delivery of the same to the U.S. Postal Service or private courier.

 

4.

By facsimile transmission. If any notice is transmitted by facsimile transmission or similar means, the same shall be deemed given upon confirmation of transmission thereof.

 

5.

By e-mail. Ifany notice is transmitted by e-mail, the same shall be deemed given upon confirmation of receipt thereof.

All notices shall be addressed as set forth in Exhibit A or at other such addresses as the Members/Authority may hereafter or from time to time designate by written notice to the other Members/Authority.

 

F.

Not  Subject  to  Annual  Appropriation:  This Agreement shall not be subject  to annual appropriation.

 

G.

Relationship of Members. This Agreement does not and shall not be construed as creating a relationship of joint venturers, agency, partners, or employer-employee between the Members.

 

H.

Liability of Members. No provision, covenant or agreement contained in this Agreement, nor any obligations herein imposed upon each Member nor the breach thereof, nor the issuance and sale of any bonds by a Member, shall constitute or create an indebtedness of the other Members within the meaning of any Colorado constitutional or statutory provision. Unless otherwise agreed in writing between any of the Members, no Member shall have any obligation whatsoever to repay any debt or liability of the other Member.

 

I.

Assignment. Except as provided in Sections 14, neither this Agreement, nor any of a Member's rights, obligations, duties or authority hereunder may be assigned in whole or in part by such Member without the prior written consent of a majority of all Members. Any such attempt of assignment shall be deemed void and of no force and effect. Consent to one assignment shall not be deemed to be consent to any subsequent assignment, nor the waiver of any right to consent to such subsequent assignment.

 

J.

New  Entity  Assignment. Notwithstanding the foregoing paragraph, in the  event that all of the Members believe that it is in the best interests of the Members and the Authority to terminate this Agreement and form a new Title 29 or Title 32 governmental entity and for the new governmental entity to enter into the WISE Delivery   Agreement,   the  Authority   agrees  to  fully   cooperate  with  such termination and assignment.

 

K.

Modification. This Agreement may be modified, amended, changed or terminated, in whole or in part, only by an agreement in writing duly authorized by the Authority and all of the Members. No consent of any third party shall be required for the negotiation and execution of any such agreement.

 

L.

Waiver. The waiver of a breach of any of the provisions of this Agreement by a Member or the Authority shall not constitute a continuing waiver or a waiver of any subsequent breach of the same or another provision of this Agreement.

 

M.

Integration. This Agreement contains the entire agreement between and among the Members and the Authority and no statement, promise or inducement made by a Member, the Authority or their employees or agents that are not contained in this Agreement shall be valid or binding.

 

N.

Severability. Invalidation of any of the provisions of this Agreement or of any paragraph, sentence, clause, phrase, or word herein, or the application thereof in any given circumstance, shall not affect the validity of any other provision of this Agreement.

 

O.

Headings   for   Convenience   Only.  The  headings,   captions  and  titles  contained herein are intended for convenience and reference only and are not  intended to define, limit or  describe  the  scope  or  intent  of  any  of  the  provisions  of  this Agreement.

 

P.

No  Third  Party  Beneficiaries.  There  are  no  express  or  implied  third  party beneficiaries  of this Agreement. No third party has any right to  enforce this Agreement.

 

Q.

Amounts   Remain  Due.  In the  event  that  this  Agreement  is terminated  for  any reason, all amounts due by Members pursuant to this Agreement shall remain due and payable and shall survive the termination of this Agreement.

 

R.

Counterparts. This Agreement  may be executed in counterparts,  each of which, when combined, shall be deemed to be an original. Facsimile or scanned signatures shall be an acceptable form of execution of this Agreement.

 

S.

Expansions   of   the   WISE   Project.  No  Member  shall  have  any  obligation  to participate  in  expansions  of  the  WISE  Project  beyond  the  amount  of  water committed to under this Agreement.

 

A.

Pending satisfactiOn of the conditions outlined in Section 20.B., the Authority, Members and Executive Board shall not exercise any of the powers granted under Sections 5 and 6, other than the following expenses incurred by the Authority and approved by the Executive Board shall be assessed to the Members based on each Member's Pro Rata Share:

 

1.

administrative and overhead expenses of  the Authority as described in Section 6.K.; and

 

2.

expenses incurred in the ongoing due diligence on the WISE Project, including the satisfaction of the conditions under the WISE Delivery Agreement and this Agreement such as the Western Pipeline Agreement and Condition 52.

 

B.

Except as set forth in Section 20.A., Sections 5 and 6 of this Agreement shall not effective until the following conditions have been met:

 

1.

Westem Pipeline. The execution of the Western Pipeline agreement which shall include provisions ensuring the financing thereof, referenced in Section 6.D. of this Agreement;

 

2.

Condition 52. The issuance of a permit satisfactory to all Members by the U.S. Army Corps of Engineers (Corps) allowing water delivered under the WISE Delivery Agreement to be stored in Rueter-Hess Reservoir; and

 

3.

CRCA. The complete execution (not contingent upon the approval of any additional parties) of the CRCA.

 

    Sections 5 and 6 shall be effective and fully enforceable on the date when last of the foregoing contingencies has been met. If the foregoing contingencies have not been satisfied as of December 31, 2013, this Agreement shall terminate unless the dates set forth in the Agreement are extended by the Members. Any extension shall be an amendment to this Agreement and approved as required herein.

 

EXHIBITS

 

A -Name, address, and contact information for each Member

B - Section 29-1-204.2, C.R.S.

C - Members' Pro Rata Share and Subscription Amount

D -WISE Delivery Agreement

 

 

 

 

 

 

 

 

 

Centennial Water & Sanitation District 62 West Plaza Drive Highlands Ranch, CO 80126-2304 Attn: John Hendrick Facsimile: 303 ###-###-#### E-mail: ***@***	Town of Castle Rock 175 Kellogg Court Castle Rock, CO 80109 Attn: Heather Beasley Facsimile: 303 ###-###-#### E-mail: ***@***
Denver Southeast Suburban Water & Sanitation District (dba Pinery Water and Wastewater District) PO Box 1660 Parker, CO 80134 Attn: Charlie Krogh Facsimile: 303 ###-###-#### E-mail: ***@***	Cottonwood Water and Sanitation District c/o Mulhern MRE, Inc. Inverness Drive East, Suite 200 Inglewood, CO 80112 Attn: Patrick F. Mulhern Facsimile: 303 ###-###-#### E-mail: ***@***
Inverness Water & Sanitation District c/o Mulhern MRE, Inc. 2 Inverness Drive East, Suite 200 Inglewood, CO 80112 Attn: Patrick F. Mulhern Facsimile: 303 ###-###-#### E-mail:   ***@***	Dominion Water & Sanitation District 1805 Shea Center Drive, Suite 210 Highlands Ranch, CO 80129 Attn: Harold Smethills Facsimile: 303 ###-###-#### E-mail:    ***@***
Parker Water and Sanitation District 19801 East Mainstreet Parker, CO 80138 Attn: Ron Redd Facsimile: (303) 901-0175 E-mail: ***@***	Meridian Metropolitan District 5750 DTC Parkway, Suite 200 Greenwood Village, CO 80111 Attn: Doug Scott Facsimile: 303 ###-###-#### E-mail:   ***@***
Stonegate Village Metropolitan District c/o Mulhern MRE, Inc. Inverness Drive East, Suite 200 Inglewood, CO 80112 Attn: Mitch Chambers Facsimile: 303 ###-###-#### E-mail:   ***@***	Rangeview Metropolitan District 1490 Lafayette Street, Ste 203 Denver, CO 80218 Attn: Mark Harding Facsimile: (303) 292-3475 E-mail:   ***@***

 

 

 

 

West's Colorado Revised Statutes Annotated Title 29. Government--Local

General Provisions

Article 1. Budget and Services

Part 2. Intergovernmental Relationships (Refs & Annos)

 

C.R.SA. § 29-1-204.2

(1)            Any combination of municipalities, special districts, or other political subdivisions of this state that are authorized to own and operate water systems or facilities or drainage facilities may establish, by contract with each other, a separate governmental entity, to be known as a water or drainage authority, to be used by such contracting parties to effect the development of water resources, systems, or facilities or of drainage facilities in whole or in part for the benefit of the inhabitants of such contracting parties or others at the discretion of the board of directors of the water or drainage authority.

 

(2)	Any contract establishing such separate governmental entity shall specify:

 

(a)	The name and purpose of such entity and the functions or services to be provided by such entity;

 

(b)	The establishment and organization of a governing body of the entity, which shall be a board of directors in which all legislative power of the entity is vested, including:

 

{I) The number  of directors, their manner of appointment, their terms of office, their compensation, if any, and the procedure for filling vacancies on the board;

 

{II) The officers of the entity, the manner of their selection, and their duties;

 

{III) The voting requirements for action by the board; except that, unless specifically provided otherwise, a majority of directors shall constitute a quorum, and a majority of the quorum shall be necessary for any action taken by the board;

 

{IV) The duties .of the board, which shall include the obligation to comply with the provisions of parts 1, 5, and 6 of this article;

 

(c)

Provisions for the disposition, division, or distribution of any property or assets of the entity;

 

(d)            The term of the contract, which may be continued for a definite term or until rescinded or terminated, and the method, if any, by which it may be rescinded or terminated; except that such contract may not be rescinded or terminated so long as the entity has bonds, notes, or other obligations outstanding, unless provision for full payment of such obligations, by escrow or otherwise, has been made pursuant to the terms of such obligations;

 

(e)            The conditions or requirements to be fulfilled for adding or deleting parties to the contract in the future or for providing water services and drainage facilities to others outside the boundaries of the contracting parties.

 

(3)	The general powers of such entity shall include the following powers:

 

 

 

 

 

(a)  To develop water resources, systems, or facilities or drainage facilities in whole or in part for the benefit of the inhabitants of the contracting parties or others, at the discretion of the board ofdirectors, subject to fulfilling any conditions or requirements set forth in the contract establishing the entity;

 

(b) To make and enter into contracts;

 

(c)            To employ agents and employees;

 

(d)      To acquire, construct, manage, maintain, or operate water systems, facilities, works, or improvements, or drainage facilities, or any interest therein;

 

(e)            To acquire, hold, lease (as lessor or lessee), sell, or otherwise dispose of any real or personal property utilized only for the purposes of water treatment, distribution, and wastewater disposal, or of drainage;

 

(f)            To condemn property for use as rights-of-way only if such property is not owned by any public utility and devoted to such public use pursuant to state authority;

 

(g)	To incur debts, liabilities, or obligations;

 

(h)	To sue and be sued in its own name;

 

(i)	To have and use a corporate seal;

 

G)              To fix, maintain, and revise fees, rates, and charges for functions, services, or facilities provided by the entity;

 

(k)	To adopt, by resolution, regulations respecting the exercise of its powers and the carrying out of its purpose;

 

(1)            To exercise any other powers which are essential to the provision of functions, services, or facilities by the entity and which are specified in the contract;

 

(m)            To do and perform any acts and things authorized by this section under, through, or by means of an agent or by contracts with any person, firm, or corporation;

 

(n)            To permit other municipalities, special districts, or political subdivisions of this state that are authorized to supply water or to provide drainage facilities to enter the contract at the discretion of the board of directors, subject to fulfilling any and all conditions or requirements of the contract establishing the entity; except that rates need not be uniform between the authority and the contracting parties;

 

(o)	To provide for the rehabilitation  of any surfaces adversely affected by the construction of water pipelines, facilities, or systems or of drainage facilities through the rehabilitation of plant cover, soil stability, and other measures appropriate to the subsequent beneficial use of such lands;

 

(p)            To justly indemnify property owners or others affected for any losses or damages incurred, including reasonable attorney fees, or that may subsequently be caused by or which result from actions of such corporations.

 

(4)            The separate governmental entity established by such contracting parties shall be a political subdivision and a public corporation of the state, separate from the parties to the contract. It shall have the duties, privileges, immunities, rights, liabilities, and disabilities of a public body politic and corporate. The provisions of articles 10.5 and 47 of title 11, C.R.S., shall apply to moneys of the entity.

 

(5)	The bonds, notes, and other obligations of a water or drainage authority formed under the proVIs1ons of this section shall not be the debts, liabilities, or obligations of the original contracting parties or parties that may enter the establishing contract in the future.

 

 

 

(6) The contracting parties may provide in the contract for payment to the separate governmental entity of funds from proprietary revenues for services rendered by the entity, from proprietary revenues or other public funds as contributions to defray the cost of any purpose set forth in the contract, and from proprietary revenues or other public funds as advances for any purpose subject to repayment by the entity.

 

 

(7)(a) To carry out the purposes for which the separate governmental entity was established, the entity is authorized to issue bonds, notes, or other obligations payable solely from the revenues derived from the function, service, system, or facility or the combined functions, services, systems, or facilities of the entity or from any other available funds of the entity. The terms, conditions, and details of said bonds, notes, and other obligations, the procedures related thereto, and the refunding thereof shall be set forth in the resolution authorizing said bonds, notes, or other obligations and, as nearly as may be practicable, shall be substantially the same as those provided in part 4 of article 35 of title 31, C.R.S., relating to water and sewer revenue bonds; except that the purposes for which the same may be issued shall not be so limited and except that said bonds, notes, and other obligations may be sold at public or private sale.  Bonds, notes, or other obligations issued under this subsection (7) shall not constitute an indebtedness of the entity or the cooperating or contracting parties within the meaning of any constitutional or statutory limitations or other provision. Each bond, note, or other obligation issued under this subsection (7) shall recite in substance that said bond, note, or other obligation, including the interest thereon, is payable solely from the revenues and other available funds of the entity pledged for the payment thereof and that said bond, note, or other obligation does not constitute a debt  of the entity or the cooperating or contracting parties within the meaning of any constitutional or statutory limitation or provision. Notwithstanding anything in this section to the contrary, such bonds, notes, and other obligations may be issued to mature at such times not beyond forty years from their respective issue dates, shall bear interest at such rates, and shall be sold at, above, or below the principal amount thereof, all as shall be determined by the board of directors of the entity.

 

(b) The resolution, trust indenture, or other security agreement under which any bonds, notes, or other obligations are issued shall constitute a contract with the holders thereof, and it may contain such provisions as shall be determined by the board of directors of the entity to be appropriate and necessary in connection with the issuance thereof and to provide security for the payment thereof, including, without limitation, any mortgage or other security interest in any revenues, funds, rights, or properties of the entity. The bonds, notes, and other obligations of the entity and the income therefrom shall be exempt from taxation by this state, except inheritance, estate, and transfer taxes.

 

(8)            A separate governmental entity established by contract, if the contract so provides, shall be the successor to any nonprofit corporation, agency, or other entity theretofore organized by the contracting parties to provide the same function, service, system, or facility, and such separate governmental entity shall be entitled to all rights and privileges and shall assume all obligations and liabilities of such other entity under existing contracts to which such other entity is a party.

 

(9)      The authority granted pursuant to this section shall in no manner limit the powers of governments to enter into intergovernmental cooperation or contracts or to establish separate legal entities pursuant to the provisions of section 29-1-203 or any other applicable law or otherwise to carry out their powers under applicable statutory or charter provisions, nor shall such authority limit the powers reserved to cities and towns by section 2 of article XI of the state constitution. Nothing in this part 2 constitutes a legislative declaration of preference for water systems or facilities or for drainage facilities owned by separate governmental entities over water systems or facilities or over drainage facilities owned by other or different entities.

 

 

 

Formerly § 29-1-203.2. Added by Laws 1977, H.B.1211, § 1, eff. June 21, 1977. Renumbered §

29-1-204.2. Amended by Laws 1982, H.B.1148, § 2, eff. March 17, 1982; Laws 2001, Ch. 30, § 1,

eff. Aug. 8, 2001.

 

C. R. S. A. § 29-1-204.2, CO ST § 29-1-204.2

 

 

Current through the Second Regular Session and First Extraordinary Session of the 68th General Assembly (2012)

(C) 2013 Thomson Reuters. No claim to original U.S. Government Works.

 

 

 

 

 

 

Member	Subscription Amount		Pro-Rata Share
Town of Castle Rock	1,000 ac-ft			13.84	%
Centennial Water & Sanitation District	1,000 ac-ft			13.84	%
Cottonwood Water & Sanitation District	400 ac-ft			5.54	%
Denver Southeast Suburban Water and Sanitation District d/b/a Pinery Water and Wastewater District	500 ac-ft			6.92	%
Dominion Water & Sanitation District	1,325 ac-ft			18.34	%
Inverness Water & Sanitation District	500 ac-ft			6.92	%
Meridian Metropolitan District	300 ac-ft			4.15	%
Parker Water & Sanitation District	1,200 ac-ft			16.61	%
Rangeview Metropolitan District	500 ac-ft			6.92	%
Stonegate Village Metropolitan District	500 ac-ft			6.92	%
TOTAL	7,225 ac-ft			100	%

 

* Amended 6/25/13 to reflect the withdrawal of Castle Pines North Metropolitan District and determination of final subscription amounts by Dominion Water & Sanitation District and Parker Water & Sanitation District.

 

 

 

 

 

 

EXHIBIT D

WISE Delivery Agreement

 

 

 

 

 

 

 

 

 

This Water Delivery Agreement ("Agreement") is entered into by the City and County of Denver, acting by and through its Board of Water Commissioners ("Denver Water"), the City of Aurora acting by and through its Utility Enterprise ("Aurora"), and the South Metro WISE Authority ("Authority'') (individually, a "Party" and collectively, the "Parties").

 

 

A.           Denver Water owns and operates a municipal water supply system that provides water to the inhabitants of the City and County of Denver and by contract to certain areas outside the boundaries of the City and County of Denver.

 

B.           Aurora owns and operates a municipal water supply system that provides water for inhabitants of the City of Aurora and by contract to certain areas outside the City of Aurora.

 

C.           The Authority is comprise of ten (10) governmental or quasi-governmental water providers seeking to develop through cooperation between its Members new surface water supplies that will decrease reliance on nontributary groundwater supplies. The Authority Members are also members of the South Metro Water Supply Authority ("SMWSA").

 

D.           Denver Water and SMWSA entered into an agreement in 1999 to investigate the feasibility of potential future cooperative water operations between the Board and the SMWSA.

 

E.           Denver Water and Aurora entered into an Intergovernmental Agreement dated April 12, 2006, committing to explore opportunities for mutually beneficial arrangements that could include shared use of water resources and water facilities.

F.           Denver Water and SMWSA entered into the Pilot Project Agreement dated February 14, 2007, committing to investigate the feasibility of potential future cooperative water operations, water efficiency, and delivery of water to SMWSA.

 

G.           Denver Water, Aurora, and SMWSA previously executed a Memorandum of Understanding (MOU) dated November 20, 2008, as amended by that certain amendment dated July of 2009, to implement a cooperative study to identify water resources, including infrastructure, that might be available for a joint water supply project to facilitate efficient and cost-effective delivery of water.

 

H.           These combined investigations have shown the potential for regional water resource operations that may significantly benefit all members of the Partnership.

 

I.           These combined investigations have identified both periodic available capacity in Aurora's existing Prairie Waters Project (PWP) and periodic available water supplies that can be utilized by the Authority and Denver Water.

 

J.           Denver Water and Aurora entered into an Intergovernmental Agreement dated August 16, 2012 that governs their operations under the WISE Project.

 

K.           Denver Water's participation in this Agreement includes providing water from reusable return flows, which originate on the West Slope. To resolve longstanding disputes with the West Slope, Denver Water has entered into the Colorado River Cooperative Agreement (CRCA), which authorizes use of Denver Water's reusable return flows in the WISE Partnership under certain terms and conditions.

 

L.           The Authority and its Members have entered into the SM WISE IGA defining the Members' participation in the WISE Project.

 

M.           Colorado law, C.R.S. § 29-1-201 et seq., authorizes and encourages local governments to contract with one another to provide any function, service, or facility, including the sharing of costs. Governments are specifically authorized by C.R.S. § 31-35-402(1)(h) to enter into agreements for planning, construction and operation of water facilities. All the Parties to this Agreement are political subdivisions of the State of Colorado, and each is authorized to acquire infrastructure and to operate water facilities.

 

N.           The Parties now wish to enter into this Agreement for water deliveries pursuant to the WISE Partnership.  The Parties' intend that this Agreement result in a permanent supply of water to the Authority, subject to this Agreement's terms and conditions. This Agreement

should be construed in such a manner as to further the Parties' intent.

O.           Engineering studies based on historic hydrology have suggested that in the future additional water may be available under the WISE Partnership, assuming significant new infrastructure, and significant additional unused return flows resulting from growth in Denver Water's and Aurora's customer base.  While changes in future hydrology, demands, or water administration will affect the volume of potential future deliveries, the Parties intend to cooperate with each other to determine if increased WISE deliveries would be feasible.   Ifthe Parties decide that increased WISE Deliveries are in their collective interests, that additional water would be subject to a separate agreement.

P.           The Parties are currently negotiating a Memorandum of Understanding with Douglas County, Colorado that would create an option for the County to acquire additional deliveries of water under the WISE Project in an amount up to 27,750 AF over a Ten-Year Block, as defined below. Such deliveries would be provided under terms substantially similar to the terms of this Agreement, and for the purpose of reducing reliance on nonrenewable groundwater by current and future customers within existing service areas in Douglas County.

 

NOW, THEREFORE, Denver Water, Aurora, and the Authority agree as follows:

 

 

1.1           The Parties have been engaged in the development of a regional water supply project, now known as the WISE Partnership (WISE). A fundamental concept of WISE is to reduce the reliance of Authority Members on nonrenewable groundwater and to create a dependable, albeit interruptible, surface water supply for Authority Members. WISE would accomplish these goals by utilizing the periodic unused or underused capacity in Aurora's PWP, and the construction or acquisition of additional infrastructure, combined with the beneficial use by the Authority of water supplies to be made available by Aurora and Denver Water. Engineering studies conducted by the Parties have demonstrated a potential for a dependable supply of water for the Authority utilizing such periodic unused capacity and available water supplies.

 

1.2           The Parties have determined that the joint use of infrastructure, the delivery of water, and the financial arrangements in this Agreement will benefit the health, safety and welfare of their respective citizens and customers, enhancing water supplies while minimizing costs.

 

1.3           Denver Water and Aurora acknowledge that the Members of the Authority will depend upon the water deliveries provided under this Agreement to partially meet their future long-term water demands. The Members of the Authority acknowledge that they cannot rely upon WISE deliveries as their sole source of water supply. The water supply being made available to the Authority by Aurora and Denver Water is permanent, variable, and interruptible under the conditions described in this Agreement. The Authority agrees to require the Members to acknowledge in the SM Wise IGA the need to maintain existing water supplies, develop new water supplies, or have adequate storage available to meet their demands when WISE deliveries are interrupted under the terms of this Agreement.

 

"Abstention Provisions" shall mean those restrictions on the acquisition of new supplies of water from the Colorado River Basin by the Authority and the Members as set forth in the Colorado River Cooperative Agreement, effective as of the date of this Agreement.

 

"AF" means acre-feet.

 

"Authority Service Area" means the aggregate water delivery service area within Douglas County and Arapahoe County to which the Members are authorized to provide water service.  The Authority Service Area within Douglas County and Arapahoe County may be modified through inclusion, annexation, or contract in the future. Any expansion of the Authority Service Area beyond Douglas County and/or Arapahoe County is subject to the prior written approval of the Parties.

 

"Binney Plant" shall mean the Binney Water Purification Facility located north of the Aurora Reservoir.

 

"Binney Plant Connection" shall have the meaning set forth in Paragraph 3.3.4.

 

"Colorado River Cooperative Agreement" or "CRCA" shall have the meaning set forth in Recital K of this Agreement.

 

"Corps" shall mean the United States Army Corps of Engineers.

"Delivery Location" shall have the meaning set forth in Paragraph 4.1.1.

 

"Delivery Obligation" shall mean a minimum delivery of 72,250 AF of water over each Ten­ Year Block.

 

"Delivery Year" means each 12-month period beginning June 1 and ending the following May 31.

 

"DIA Connection" means that interconnection between Denver Water's treated distribution system near the Denver International Airport and Aurora's PWP as described in Attachment B.

 

"DIA Connection Fee" means the payment made by the Authority to Denver Water pursuant to Paragraph 3.3.1.

 

"Dominion Agreement" means that certain Intergovernmental  Agreement for Temporary Lease of Water between Aurora and Dominion Water & Sanitation District dated July 30, 2012 or any subsequent agreement(s) for delivery to Dominion at an alternative point of delivery.

 

"ECCV" means the East Cherry Creek Valley Water and Sanitation District.

 

"ECCV Western Line" means the 48"-54" pipeline owned by ECCV that runs from the vicinity of E-470 and Smoky Hill Road south and west along E-470/C-470 to the vicinity of E-470 and University  Boulevard.

 

"Effective Date" shall have the meaning set forth in Paragraph 5.30.

 

"Joint Advisory Committee" shall mean that certain advisory committee formed by the Parties pursuant to Paragraph 5 .1.

 

"Member" means a member of the Authority.  At the time of execution of this Agreement, the Members are as follows:

    Town of Castle Rock

    Dominion Water & Sanitation District

    Stonegate Village Metropolitan District

    Cottonwood Water & Sanitation District

    Denver Southeast Suburban Water & Sanitation District (a/k/a Pinery Water and Wastewater District)

    Centennial Water & Sanitation District Rangeview Metropolitan District

"MGD" means million gallons per day.

 

"Master Meter" shall refer to the primary meter through which deliveries are made to the Authority; during the Phase In Period, through the Temporary Interconnect and thereafter through the Binney Plant Connection.

 

 

---

---