HomeMy WebLinkAbout4986 RESOLUTION NO. 4 9 8 6
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
AUBURN, WASFiINGTON, AUTHORIZING THE MAYOR
AND CITY CLERK TO EXECUTE AGREEMENTS
BETWEEN THE CITY OF AUBURN AND CASCADE
WATER ALLIANCE FOR THE PURCHASE AND SALE OF
CREDITS RELATING TO PERMANENT AND RESERVE
WHOLESALE WATER SUPPLY CAPAGITY
WHEREAS, the Ciry of Aubum has a duty and responsibility to provide water to
its community; and
WHEREAS, in February 2010, the City of Aubum entered into the 2010 Lake
Tapps Area Water Resources Agreement that provided, among other things, for
Cascade Water Alliance (Cascade) to assist the City in meeting its projected 50-year
water supply needs; and
WHEREAS, in February 2013, Cascade informed 4he City of the availability of a
water supply opportunity; and
WHEREAS, the City confirmed its desire to purchase a System Development
Charge Credit from Cascade for both 4 Million Gallon per Day ("MGD")Pertnanent, and
6 MGD Reserve Wholesale Water Supply.
NOW, THEREFORE. THE CITY COUNCIL OF THE CITY OF AUBURN,
WASHINGTON, HEREBY RESOLVES as follows:
Section 1. That the Mayor and City Clerk are hereby authorized to execute
Agreements between the City and Gascade Water Alliance for the Purchase and Sale of
Credits Relating to PermaneM and Reserve Wholesale Water Supply Capacity, which
agreements shall be in substantial conformitywith the agreements attached hereto as
Exhibits A and B and incorporated herein by this reference.
Resolution No. 4986
August 21, 2013
Page 1 of 2
Section 2. That-the Mayor is authorized to implement such administrative
procedures as may be necessary to caarry out the direct'ryes of this legislation.
Section 3: That this Resolution shall take effect and be in full force upon
passage and signatures hereon.
Dated and Signed this �'�day of , 2013.
CI AUBU
��
P R B. LEWIS, MAYOR
ATTEST:
J_'��/��C �1C9�
Danielle E. Daskam, City Clerk
APPROV D AS TO FORM:
Da iel . He' , City A orney
Resolution No. 4986
August 21, 2013
Page 2 of 2
AGREEMENT FOR THE PURCHASE AND SALE OF CREDITS
RELATING TO PERMANENT WHOLESALE WATER SUPPLY CAPACITY
THIS AGREEMENT("ARreement")is made and entered into as of this 1o�'day of
$ej�eM bpr 2013 ("Effecrive Date"), by and between the City of Aubum, Washington
("Aubum"),and Cascade Water Alliance, a joiat municipal utilities services authority organized
under Chapter 39.106 RCW ("Cascade"). The City and Cascade are sometimes refened to �
collectively as the "Parties" and individually as a"Part ."
RECITALS
WHEREAS,in 2005, in order to meet Cascade's immediate and long-term water supply
needs, Cascade purchased from Tacoma a supply of water both permanendy and for a finite
period of years pursuant to an"Agreement for the Sale of Wholesale Water";
VJHEREAS,on February 5,2010,Cascade and the Cities of Bonney Lake,Buckley,
Sumner and Aubum entered the 2010 Lake Tapps Area Water Resources Agreement(the"Four
Cities A�eement"}that provided,among other things,for Cascade to assist the fonr cities in
meeting their projected 50.yeaz water supply needs;
WHEREAS, on December 31,2012,Cascade and Tacoma entered the Amende.d and
Restated Agteement for the Sale of Wholesale V✓ater(the"Amended and Resfated Am�eemenY')
that provided, among other things, for Tacoma to make available to the four cities a water supply
to be purchased direcdy from Tacoma as a wholesale customer and to recognize credit for the
System Development Charges that Cascade had previously paid to Tacoma;
WHEREAS, Cascade and Tacomasent a letter,date3 February 11, 2013,w inform
Auburn of the availability of the"substitute"water supply opportunity and related time
limitations and pmcediues for acting on the opportunity("Joint Letter");
R/HEREAS,Aubum timely approved,signed,and delivered the Confirmation Notice,
dated May 21,2013,to confirm Auburn's election of the.substitute.supply opportunity and its
desire to purchase a System Development Cliarge Credit from Cascade as to the 4 MGD
•Wholesale Water Supply("Confirmation Notice"); and
WHEREAS,the Joint Letter and Confirmation Notice are set forth in Exhibit A hereto
and are incorporated by reference in this Agreement;
NOW, T'HEREFORE, IN CONSIDERATION of the recitals stated above,which aze
incorporated herein, and the mutual covenants and conditions herein contained,the Parties agree
as follows:
AGREEMENT
1. Definitions.
"4 MGD Wholesale Water Sunnlv"means an average annual 4 MGD wholesale water
supplyfrom Tacoma, with a Peaking Factorof 1,33,and a maximum peak day of 532 MGD, all
as provided in the Amended and Restated Agreement.
"Amended and Restated A�reemenY'means the"Amended and Restated Agreement for
the Sale of Wholesale Watei"by and among Cascade and the City of Tacoma,Department of
Public Utilities, Water Division,dated December 31,2012.
"Confirniation Notice"means the document, dated May 21, 2013, in which Aubum
confirmecl its election of the substitute supply opportunity in fulfillment of Cascade's obligation
in the Four Cities Agreement to assist withAubura's projected 50-yeaz water supply needs
(attached"in Exhibit A).
"Four Cifies AereemenY'means the "2010 Lake Tapps Area Water Resources Agreement
among the Cities of Auburn, Bonney Lake, Buckley and Siunner,and Cascade Water Alliance,"
dated February 5,2010.
"MGD"means million gallons per day.
"Joirit Letter"means the le'tter,dated Febniary 11, 2013, from Cascade and Tacoma to
Cities of Auburn,Bonney Lake, Buckley and Sumner that is attached hereto in Ex}ribit A.
"Norice of ConfirmaUon of Svstem Development C e CrediY'means a nodce, given
by Cascade to Tacoma at the request of Auburn,confirming the amount of the System
Development Charge Credit(if any)to be.applied to the System Development Charge otherwise
due and payable by Auburn to Tacoma in oonnaction with a wholesale water supply agreement.
"�stem Develonment Char�"or"SDC"means the system development charge
imposed npon wholesale customers by Tacoma in its wholesale water regulations. -
"�stem Development Char�e CrediY'means a credit to be applied in a wholesale water
supplyagreement against the System Development Charge otherwise due and payable by
Auburn to Tacoma. The System Development Charge Credit is expressed in million gallons per
day (MGD) units and in dollars.
"Tacoma"means the City of Tacoma, Department of Public Utilities, Water Division.
Page 2 of 8
2. Term of Agreement
Tlris Ageemeat takes effect on the first date tliat both Parties have duly approved,
signed, and delivered the Agreement to the other Party. The term of the Agreement will
commence on the effective date and will end on December 31,2029 or the date that Aubum has
fully paid Cascade for the price of the System Development Chazge Credit consistent with
Sections 3 and_4 of this Agreement.
3. Purchase of 4 MGD System Development Charge Credit& Price.
Auburn agees to purchase and Cascade agrees to sell a System Development Charge
Credit regazding the 4 MGD V✓holesale Water Supply in the quantity of 2.5 MGD am►ual supply
capacity(3.32 MGD peak supply capacity). �
In consitleration for said System Development Charge Credit,Auburn will pay to
Cascade a total price of$7,893,300.00 as of the date that this Agreement takes effect. The
parties agree that Aubum will pay interest at an annual rate of 3:2%on the balance due
beginning in 2017 and continuing until the balance is fully paid and this Agreement terminates.
Auburn will pay the total price by making an annual payment in 2017-2029 according to
the annual payment schedule set forth in Section 4 below. This schedule incorporates interest at
a rate of 3:2%on the balance due,beginning in 2011. Under this schedule the total of annual
' payments including interest is $10,105,806.00.
4. Annnat Payment Schednle.
Auburn will make annual installment payments to Cascade to pay for the System
Development Charge Credit as to the 4 MGD Wholesale Water according to the following
payment schedule:
Payment Schedule
_ w .. , r-�. — . ( �cri. . . �. —
YCBi �1�IIlOL1Lt'. ' � T'C8i '0:� _ �� , E�1110UIIt' _
� . •-
,._____�., c� ---- -- — - — _ ` — '_` _ '
2014 0 2022 $934,805
2015 0 2023 $934,805
2016 0 2024 $934,805
2017 $252,586 2025 $934,805
2018 $252,586 2026 $934,805
2019 $252,586 2027 $934,805
2020 $934,805 2028 $934,805
Page3 of 8
2021 $934,805 2029 $934,805
Total $10,105,806
Each year the annual payment shall due and payable by Auburn to Cascade on or before
June 30 of the yeaz in which such payment`is due. If full payment of any annual payment is not
received by Caseade on or before the date due,such payment shall be considered past due,and
the unpaid aznount shall accrue additional interest,from the date due until the date paid, at a rate
per day equal to 0.03 percent per day. Upon not lass than fifteen(15)days'advance notice to
Cascade,the City may in any given year prepay without penalry any one or more of the next
successive annual payments. Upon such notice, Cascade will provide Auburn documentadon of
the amount due for such payment, and adjustments to any remA;n;ng payment schedule,net of
related interest incorporated into the above paytnent schedule:
5. NoHce of Confirmation of System Development Charge Credit
Within 30 days after tlris Agreement takes effect, Cascade will send to the Tacoma Water
Superintendent a Notice of Confirmation of System Development Charge Credit regarding the 4.
MGD VJholesale Water Supply in the quantity of 2.5 MGD annual supply capacity. Cascade
will provide a copy of the 1Votice to Auburn when it is sent to Tacoma.
6. Wholesale Water Supphy Purchase Negotiations witL Tacoma
In order to use the System Development Charge Credit and secure a wholesale water
supply from Tacoma, Auburn aclaiowledges that it aiust make an offe=, complete negotiations,
and enter a wholesale water supply agreement with Tacoma consistent with the Joint L.etter and
Confirmation Notice set forth in Exhibit A and with the Amended and Restated.Agreement.
Aubum aclmowledges and agrees that Cascade makes no representations or warranties as to the
outcome of such negotiations,the Tacoma wholesale water supply that Aubum may(or may not)
be able to purchase, or otherwise.
7. EffecYon Four Cities Agreement
The Parties agee that this Agreement constitutes fiill performance by Cascade of its
obligadons under Section 3(a) of the Four Cities Agreement. Accordingly, Section 3(a)of the
Four Cities Agreement shall be of no further force or effect as between Cascade and Auburn.
Otherprovisions of the Four Cities Agreeaient a;e unaffected by tlus Ageement and remain
effective according to their terms.
8. Notices.
All notices and payments hereunder may be delivered or mailed. If mailed, they shall be
sent to the following respective addresses:
Page 4 of 8
Cascade Water Alliance: City of Auburn:
520 112�' Avenue NE, Suite 400 Attn: Dennis Dowdy
Bellevue, Washington 98004 25 W Main St
Attn: Ctrief Executive Officer Auburn WA 98001
Phone: (425)453-0930 Phone: (253)931-3010
F�: (425)425-453-0953 Fax: (253)931-3053
A Party may change its address from time to time by providing notice to the other Party. All notices
and paymenis mailed by regular post(including first class)shall be deemed to have been given on �
the second bnsiness day following tfie date of mailing,if properly mailed and addressed. Notices
and payments sent by certified or registered mail shall be deemed to have been given on the next
business day following the date of mailing, if properly mailed and addressed.For all rypes of mail,
the postmark affixed by the United States Postal Service shall be conclusive evidence of the date of
mailing.
9. Dispnte Resolution.
In the event that any dispute arises tietween Cascade and Auburn,the aggrieved Party
shall give a notice of ihe dispute to the otlier Party. Cascade and Auburn shall, within five(5)
days of such notice, each nominate a senior officer of its management to meet ata mutually
ageed location,to attempt to resolve such dispute. The Parfies shall each designate a
representative(s)to confer on the best and most cost effective way to resolve the dispute. By
mutual ag;eement,they may choose direct negoriations or mediadon. If there is no agreement
between the Parties on how to proceed within thirty(30)days, either Party may pursue legal
action;provided,fiowever,no Party shallbe precluded from filing an appeal or action to prevent -�
the expiration of a time periodfor filing or any statute of lunitations.
If a Party fails to perform its obligations hereunder,then it shall be in default hereunder
unless the defaulting Party cures an event of default, whether monetary or non-monetary, within
tlrirty (30)days after receiving written notice &om the other Pacty of such default
Subject to ffie procedures set forth in Secuon 9 (Disvute Resoludon), ifa Party is in
breach or default of its obligations arising under this Agreement,the other Party shall have and
shall be entiUed to exercise any and all remedies available to it at law or in equity(incl_uding the
right to specifically enforce this Agreement),all of which remedies shall be cumuladve.
11. Attomeys'Fees.
If any Party shall be required to bring any action to eaforce any provision of this Agreement,
or shall be required to defend any action tirought 6y the other Party with respect to this Ageement,
and in the fiuther event that one Party sfiall,substautially prevail in such action,the losing Pazty
shall, in addition to all other payments required therein,pay all of the prevailing Parry's reasonable
costs in connection with such action,including such sums as the court or courts may adjudge
reasonable as attomey's fees in the trial court and in any appellate courts.
Page 5 of 8
12. No Assignment
This Agreement is specific to the Parties and may not be assigned in whole or in part.
13. Non-Waiver.
No delay:or failure by a Party to exercise any of its rights,powers or remedies under this
Agreement following any breach by another Party shall be cons�ued to be a waiver of any such
breach,or any;acquiescence therein,or of orin any sunilar breach thereafter occurring,nor shall
any waiver of any single breach be deemed a waiver of any other breach theretofore or thereafter
occurring.
14. No Third Party Beneficiary. ,
This Ageement is for the sole and exclusive benefit of the Parties and is not intended to
and sha1T not confer any rights or beaefiu on any third party not a signatory hereto..
15. Integrated Agreement
This Ageement constitutes the entire agreement between the Parties with respect to the
subject matter hereof and supersedes all prior or contemporaneous understandings oragreemenu
with respect thereto; provided, however;that this Agreement sha11 be interpreted or conshved
together with the Ameaded and Restated Agreement,the Joint I.etter,and the Confirmation
Notice. No modiScations or amendments of this Ag�eement shall be valid or effective imless
evidenced by an ageetbent in writing sigied by the Parties.
16. Signature in Counterparts.
This Agreement may be executed in counterparts and all of those counterparts taken
together shall constitute one and the same instrument.
17. Representallons of the Parties.
Each Party represents and warrants that it has duly approyed,executed, and delivered this
Agreement and that it has all necessary authority to enter into this Agreement and to perform its
terms and obligations. Each Party represents and warrants that the appmval, execution,and
delivery have been duly authorized by the appropriate boatd or council, andno other act or .
proceeding on the part of any Party is necessary to authorize entry into or performance of this
Agreement.
IN WITNESS WHEREOF,the Parties have duly executed this Agreement as of the
Effective Date.
Page 6 of 8
City of Cascade Water Alliance:
By: � By: Chuck Clarke (%�%r,�tu' �%��`�`�—
Tide: MAva� Tifle: Chief Executive Officer
0
Date: SEP 10 2013 D�: �/��//�
ATTEST
City Clerk
APP AS TO FORM
� Cify Atfomey
Page 7 of 8
Ex6ibit A
[Joint Letter signed by Cascade and Tacoma,dsted Febri�ary 11,2013,and the
Confirmation Notice signed by Aubum,dated May 21,2013.]
� �
CASCADE � •�
WATFR AI. L7ANf' F ";.^.�r�r�aWATER
T�CON1 IU�IIC VTILITIif
February 11,2013
The E3onorable Pete Lewis The Honoiable Pat 7ohnson
City of Aubum City of Buckley
25 West Main S�eet 933 Main Sn�eet
Aubum, WA 98001 Buckley, WA 98321
The Honorable Neil Johnson The Hoaorable Dave Enslow
City of Bo�ey Lake City of Sumner
19306 Bonney Lakb Blvd. 1104 Maple Strcet
Bonney Lake,WA 98391 S�ner, WA 98390
Re: Cascade.Water Aliiance and Tacoma Water Substitute Wholesale Water Supply
Availability—Time is of the Essence(Sent by Email and US Main
Dear Mayors:
As you may be aware,the Cascade Water Alliance and City of Tacoma have becn in ongoing
discussions about potential changes to the 2005 Water Supply Agreement. In late 2012 a new
agi+eement was reached and signed which benefiu aot only Tacoma sad Cascade but also the
Four Cities of Auburn, Bonney Lakc,Buckley and Sumner. Tlris new agreement preserves the
right of the four cities imder the 2009 Cascade/Four Cities Agcement and allows a new time
sensitive supply option to be jointly offered to the foiu cities from Cascade and Tacoma.
The Cascade Water Alliance(Cascade),in cooperation with Tacoma Water,is offering the
availability of a substitute wholesale water supply("SulistiUrte Supply'�and to provide tlris
notice of a limitad period of time for yma Cities to tske action on this unique oppommity.
Cascade and Tacoma have entered into a Restated and Amended A�reement for the Sale of
Wholes8le Water,which replaces the 2005 agi�eement betweea the pazties for purchase and sale
of wholesale water. The 2005 agreement is included as one of the"watersupply agsistance"
meastiies m the2010 Lake Tapps Atea Water Resources Ag�reement between Cascade and your
cities(;he"Four Cities AgreemenY').
In the Restated and Amendad Agreemem, Cascade has agre8d to=elinquish its right to take
delivery of the Substitute Supply. This watet is now availablq to the Cities to piuchase ditectly
from Tacoma as a wholesale customer. Cascade has,howevec,pnwiously paid cspacity charges
for this wholesale water supply. If your City now desires to purchase the Svbstitute Suppty
directly from Tacoma and takes action described in t6is lettei,Cascade is willing to sell yo�a
City a credit(reflecting the amou�s that Cascade has previously paid to Tacoma)thai can be
Joint Letter to the Four Cities
February I 1,2013
Page 2
applied against System Development Chazges that would otherwise be due to Tacoma("SDC
CrediY'): The amount and availability of any SDC Credit will be determined by Cascade in
accordance with the terms set forth in the Confirmation,Notice that is attached to this letter. You
must act promptly,however,in order to secure the opportunity to obtain an SDC Credit from
Cascade.
1'his letter pro��ides Cascade's formal notice of the limited window of time for}rour City to act,
the Confirmatioa Notice that you must return to Cascade to apply for a SDC Credit,and general
guidance as to how Cascade and Tacoma intend to cooperate to facilitate the implementation of
the Restated and Amended Agreement.
Limited Time toAct
You must act within 120 days from the first meeting of Tacoma, Cascade and the Four Cities to
confirm yo�interest in tivs opportunity by delivering a signed "Confirmation Notice" to
Cascade in the form attached to this letta. This oppommity expires at the end of 120 days.
During this 120-day period,the quantity allocation among and between the Four Cities as stated
in the Four Cities letter to Cascade, dated February 5,2010, sha11 be recognized by Cascade and
shall determine the maximum allocarion of the Substitute Supply(and the Residual Wholesale
Water Supply) among the Cities (unless the Four Cities joindy agee to reallocabon in
accoraance with the Four Cities Ageement). A City has until the expiration date to deliver an
execvted Confirmation Norice to Cascade. df you select.this opportunity by acting within the 120
days,then you have until Mazch 1,2018 to purchase(or agree to purchase) an SDC Credit from
Cascade. (In anticipation of the required steps with Tacoma described below, it is advisable for
your City to wmplete the SDC purchase agreement with Cascade in advance of Mazch 2018 to
allow yow City ad�uate time for the Tacoma steps.) If you select this opporhmity by acting
within the 120 days,then you will also have until Mazch 1,2018 to submit a Wholesale Water
Agreement with Tacoma that is eligible for the SDC Credit:
If you do not confirm your selection by delivering a Confirmation Notice to Cascade by the
deadline,then you decline the Substitute Supply opportunity stated in this letta. In that event,
you will sfill be_able to purchase wholesale water suppiy(if any water supply capacity remains
available) from Tacoma on terms consistent with Section 3(a) of the Four Cities Ageement.
However,you will not be eligible for an SDC Credit.
Next Stens with Cascade
If you deliver the Confirmation Notice within the 120-day deadline stated above and select this
Subsritute Supply oppoitunity,then you will need to complete the following steps with Cascade:
(a) Confirmarion to Cascade that your City will proceed with the Substitute
Supply opportunity stated herein, and that it fully substitutes for Section
3(a)of the Four Cities Ageement which will have no furthcr force or
effect.
(b) Agee with Cascade for payment terms to Cascade for the SDC credit.
Joint Letter to the Four Cities
February 11,2013
Page 3
(c) Upon compleaon of the items in (a) and (b) above,Cascade will send
Notice of Confirmation of System Development Charge Credit to Tacoma.
Next Steps with Tawma Water
If you deliver the Confirmation Notice to Cascade within the deadline stated above and select
this opportunity,then you would also need to aomplete the following steps with Tacoma in order
to submit a timely offer to purchase all or a portion of the Substitute Supply. The procedures and
requirements that must be followed to submit such an offer aze set forth in Sedion 6 and Section
7 of theRestated and Amended Agreement(attached for reference). It is important to read these
procedures and requirements carefully as any offer you make musc be in strict compliance with
these procedures and requirements. These procedures and requuements aze briefly summarized
as follows:
(a) In order to obtain a SDC Credit,Tacoma must be in receipt of a Notice of
Confirmation of System Development Charge Credit from Cascade:
(b) Prior to submitting your offer to purchase water from Tacoma, you must
obtain Tacoma's written review and appmval of the Wholesale Water
Supply Agreement(including any proposed modifications thereo�
gursuant to which such offa is to be made to Tacoma.
(c) Your offer to Tacoma must be submitted in the form of duplicate
executed originals of the Wholesale Water Supply Agreement, in strict
conformity with the form of the Wholesale Water Supply Agreement
approved by Tacoma.
(d) No later than March 1, 2018, youmust deliver your offer to Tacoma,
Attention: Wafer Superintendent, 'I'acoma Water, 3628 South 35th Street,
Tacoma,WA 98409, and obtain Tacoma's acknowledg�ent of the time
and date of Tacoma's receipt of such offa.
Clarifications
While we are pleased to present this opportunity to your City, we want to avoid any confvsion as
to what this opportunity is and is not. Foravoidance of doubt,this lckter does not constitute a
modiScation or waiver of any of the procedures or requirements set fort6 in the Restated and
Amended Agreement. This letter does not constitute an offer by Tacoma to sell a wholesale
water supply to any person or entity. Any such sale by Tacoma'is subject to and contingent upon
" the negotiation,execution and delivery of a mutually acceptable Wholesale Water Supply
Ageement.
Conclusion
Cascade and Tacoma aze pleased to provide the availability of Substitute Supply, and look
forward to receiving your offer to purchase, should you desire to'do so,in accordance with the
Joint Letter to the Four Cities
Fcbruary t 1,20]3
Page 4
guidelines set forth above. We will be contacting your office within the next wcek to schedule a
meeting to present and discuss this opportunity.
Sincerely,
C���C�� �ti���-C�
Chuck Clazke Linda A. McCrea
C6ief Executive Officer Superintendent
Cascade WaterAlliance Tacoma Water
Joim Letter to the Four Cities
February 11,2013
Page 5
Confirmation Notice
To Be Delivered to Cascade Water Alliance]20 days From the First Mceting of Tacoma,
Cascade and The Four Cities
The City of ("City")confians receipt of the letter, dated , &om
Cascade Water Alliance ("Cascade")and Tacoma Water presenting the availabiliTy of a
substitute wholesale water supply ("Substitute Supply"). The City understands that the
Substitute Supply is an alternative to the provisions of Section 3(a) of the 2010 Lake Tapps Area
Water Resources Agreement between Cascade.and the Cities of Auburn, Bonney Lake, Buckley,
and Sumner(the"Four Cives Agreement"). The City understands that the Substitute Supply
requires the City to enter a wholesale water supply agreement with Tacoma Water to be
negoriated and offered to Tacoma Water by March 1,2018 as described in the above-referenced
letter. The City unde�stands tfiat Cascade Water Alliance is offering to sell a System
Development Gharge Credit to the City on the ierms and condirions stated on Exhibit ] attached
hereto, provided that by Mazch ], 2018 Cascade and the City need to enter an agreement to
confirm the purchase aad sale and Cascade's provision of a Nofice of Confirmation of System
Developmem Charge("5DC")Credit to Tacoma Water.
Now,therefore, the City of hereby confums and agrees as follows:
(a) The Cit}•the elecu the "SubstituteSupply"opportuniry described herein as an alternative
that fully substitutes for secrion 3(a)of the Four Cities Agoement.
(b) The City provides this Confirmation Norice with respect to the following portion of the
Substitute Supply:
4 MGD wholesale supply:
6 MGD wholesale supply:,
{c) Byselecting the"Substitute Supply"altemative, the City agrees thaf Cascade has fiilly
performed and satisfied all obligations to the City under 3(a) of the Four Cities agreement.
(d) The City agrees that section 3(a) of the Four Ciries Agreement shall be of no further force
or effect as between Cascade and the City.
(e) The City and Cascade shall proceed with diligence to negotiate an agreement for purchase
of an SDC Credit consistent with the terms ouUined in Ezhibit 1.
CONFIRMED,ACCEPTED AND AGREED TO BY THE GITY OF on
tius day of , 20]3:
By
[Namej
Mayor
w
CITY OF '
������ PeterB. Lewis, Mayor
� WASHINGTON 25 West Main Sheet * Aubum WA 98001-4998 * www:aubumw6.gov * 253-931-3000
`
A1ay 21.2013
Cascade WaterAlliance
Attn: Cfiuck Clarke, Chief Executive O�cer
520 I 12'"Avenue NE, Suite 400
Bellevue, Washington 98004
Re: Confirmation Notice–City of Auburn's Response to Cascade's Offer of Substitute
Supply
DearMr. Cltuke,
On May 6'�,2013 the Aubum Ciry Council appmved Resolution 4951 authorizing the Ciry of
Aubum to begin negotiations with Cascade Water Alliance in response to your February I I,
2U13 offer.
Enclo;ed pleasc: fir�d a signed original ofthe Cit}•'s confirmation nuticz.
Vur Public Works L)irector will bc in touch aith }ou soon to begin discussion ofthe city's
desires to mal.a use of the Substilute Supply..
Stricore y,
- -- —�
Pete .,ewis
Mayor
Fnclosures
cc: Dennis Dowdy, Director of Public Works
Received
MAY 2 3 2013
::�,: .. �
AUBURIV * MORE THAN YOU IMAGINED
Confirmation Notice
To Be Delivered to Cascade Water Alliance 120 days From the First Meeting of
, Tacoma, Cascade and The Fow Cities
The City of Aubum("City") confirms receipt ofthe lettee,dated February 11,2013, from
Cascade Water Alliance("Cascade")and Tacoma Wate�presenting the availability of a
substitute wholesale water supply("Substitute Supply"): The City understands that the
Substitute Supply is an alternative to the provisions of Section 3(a)of the 2010 Lake Tapps Area
Water Resources Ageement between Cascade and the Cities of Auburn,Bonney Lake, ,
Buckley,and Sumner(the "Four Cities Agreement"). The City understands Uiat the Substitute
Supply requires the City to enter a wHolesale watersupply agreement with Tacoma Water to be
negotiated and offered to Tacoma Water by Mazch 1,2018 as described in the above-referenced
letter. The City undeYstands that Cascade Water Alliance is offering to sell a System
Development Charge Credit to the City on the terms and condiuons stated on Exhibit 1 attached
hereto,provided that by March 1,2018 Cascade and the City necd to enter an ag�reement to
confirm the purchase and sale and Cascade's provision of a Notice of Confirmation of System
Development Chazge("SDC") Credit to Tacoma Water.
Now, there fore,the Ciry of Aubum herebv confirms and agrees as follows:
(a) The City the elects the "Substitute Supply" opportnniry described herein as an
alternative that fully subsritutes forsection 3(a) of the Four Cities Agreement provided
that the City can negotiate acceptable terms with Cascade to provide and finance the
necessary water supply SDC credits.
(b) 'I'he Ciry provides this Confirmation Notice with respect to the following portion of the
Subsritute Supply:
4 MGD wholesale supply: 4 MGD
6 MGD wholesale supply: Possible ovtion of 3 MGD
(c) ,By selecting the "Subsutute Supply" a(temative,the Ciry agrees that upon execu6on of a
. new Subs[itute Supply agreement with Cascade to provide SDC Credits for 4 MGD of
supply, Cascade will have fully performed and satisfied all obligations to the City under
3(a)of the Four Cities agreement:
(d) The Ciry agrees that section 3(a)of the Four Ci6es Agreement shall be of no fiuther
force or effect as between Cascade and the City when a new substitute supply agreement
with Cascade is executed.
(e) The City and Cascade shall proceed with diligence to negoriate an agreement for
purchase of an SDC Credit consistent with the terms oudined in Exhibit l (Attached),
CONFIRMED, ACCEPTED AND AGREED TO BY THE CITY OF AUBURN on this
21" day of May, 2013:
By:
Pete Lewis, ayor
� Exhibit 1
TERMS FOR 4 CITIES SUBSTITUTE SUPPLY OFFER
I. This offer is structured to fulfill Cascade's obligations to make avaiiable Tacoma water as
described in the existing"4 Cities Agreement". Ayailability of the terms of this offer is
contingent upon written acceptance of the substitution of this supply offer for the
commitment defined in Section 3.a of that 4 Cities Agreement specificaliy:
a. Paragraph 3A,providing options for purchase of Cascade's contrected Tacomasupply
capacity, is replaced by the substitute capacity offer defined in this proposal.
b. Paregreph 3A is rnnfirmed in writing to be fully sati�ed by acceptance of this substitute
capacity offer.
c. Upon expiration of the su6stitute capacity offer on December 31, 2017,all Cascade
obligations to make Tacoma water available are deemed fulfiiled and terminated.
d. The substitute capacity offer must be accepted and executed no later than 120 days from
the firstmeeting of Tacoma,Cascade and the Four Cities and the offer is withdrawn after
expiretion da[e. (Actual commitment to purchase water under those terms,once
accepted,can occur anytime through 2017 as further delineated in section Il.c beiow.j
II. Substkute Capaeity Offer
a. The foilowing capacity is made available:
i. 9:3 mgd of average supply and a peak supply of 11.3 mgd. [This is the remaining
available capaciry of Cascade'spurchases from Tacoma.j
ii. Cascade offers all capacity as firm and permanent. Cascade will be responsible
for any transactions needed to convert reserve capacity to permanent capacity.
iii. All capacity will be offered as year-round capaciry with the following structure:
for each 1 mgd of year-round capacity,a peak season retio of up to 1:33 will be
available for puichase. The peak:annual ratio of 1.33:1.0 is based on the Tawma
capacity owned tiy Cascade,which originally totaled 10 mgd annual average and
133 mgd peak season. CRies may eled peak retios ranging from 1.0 to 1.33,
subject to total capacity limits defined in the attached ta61e.
iv. Tacoma will provide wholesale service contingent on execution of a wholesale
supply agreemerrt defning terms for service and related charges. A sample
agreement form is provided.
b. The following price and financial terms are offered:
i. Capacfty will be offered at a price of 7596 of the SDC($3.17 per gallon ' 75%=
$2.3775 per gallon)originally paid by Cascade. This charge will apply to annual
� capacity and to incremental peak season capaciry.
1. For example,for a purchase of 1 mgd annual/13 mgd peak season,the
cost will be l mgd' $23775 million+03 mgd '$2.3775 million =
53,090,750. A purchase of 1 mgd annual with no peak seawn increment
would co5t$2,377,500.
ii. Payments for capaciry purchase will be to Cascade; when the purchase involves
conversion of reser4e capaciry,Cascade may opt to direct al�or part of the
payment to 7acoma. '
iii. For each purchase,the following financing terms are available:
1. Full payment of purchase price upon execution of purchase;or
2. Payment of 20%of purchase price upan execution; remainder financed
on a note over 5 years at 3.3% interest with level annual payments due
upon each anniversary date. Purchaser would be free to pay off note at
any time.
iv. Wholesale rates for service and delivery are as defined by agreement with
Tacoma (see also below).
c. The following schedule applies to the substitute offer:
i. The substitute capacity offer,must 6e accepted and executed no later than 120
days,after the first meeting of Tacoma,Cascade and the Four Cities and the offer
is withdrown after expiration date. If not accepted during this period,then the
existing terms of paragraph 3.a would remain in effed.
ii. Ouring the period from execution of this substitute offer until December 31,
2015, each Ciry may elect to purchase its related share of capacity at any time.
Shares of capaciry can aiso be re-assigned upon notice provided to Cascade by
both parties of such intent.
iii. Beginning January 1,2016 and eMending through December 31,2017,any City
may offer to purchase any or all capacity remaining available on a first come,first
serve basis. Cascade will notify the Cities of available capacity early in2016.
iv. After December 31, 2017,no substitute supply capacity will be available.
v. Participants in this substitute capacity offer are free to transfer rights to purchase
to other participants, but only to other participanu, provided that Cascade
receives clear and binding direction to this effect from both parties.
III. Specia!Situotion: Bonney Lake previously acquired 2 mgd of peak season (June-September)
capacity,with no right of service in the off-peak period. This is equivalent in quantity to 2.0
mgd peak and 0.7 mgd average annual. This leaves related off-peak capacity with no
corresponding right of service.in the peak period.
1. eonney Lake is offered revision of this wpacity right to 2 mgd peak
together wkh 1.50 mgd annual ppacity.
. 2. This offer to revise the capacity structure is made available for 90 days
after the effective date of eonney Wke's acceptance of the substitute
capacity offer.
3. Purchase Price for this revision is the extension of existing payments by
one year(to include 2019),a net cost addition of$391,222.
4. If Bonney Lake does not approve this extension prior to the expiration
date,then otherparties are free to acquire the related off-peak caqacity
as a part of a year-round capaciry purchase at an incremental price of
5391,222.
IV. Integration of Cascade and Tacoma obligations under this substitute capacity offer:
a. As defined in the revised agreement between Cascade and 7arnma, it is the intent of
Cascade and Tacoma that any purchases under this offer are subject to execution of an
agreementfor wholesale seniice with Tacama. Cascade would have no ongoing role in
delivering wholesale water after execution of such agreement with Tacoma.
b. 7acoma will commit to suppty water purchased-under this agreement,subject to
execution of a wholesale water agreement acceptable to Tacoma and generally defined in
a draft wholesale agreement.
i. 7acoma will work with the purchaser to establish a mutually acceptable delivery
point orpoiMS,to be defined in the wholesale water agreement.
ii: No SDCs will be due to 7acoma for watercapacity purchased under this
agreement.
iii. The purchaser will be subjed to Tacoma wholesaie retes.
Substitute Offer of Available Tazoma Supply Capacity
Total Aubum Bonney Lake Buckley Sumnen
Capacity 9.2 mgd 7.0 mgd 1.5 mgd OJ mgd 0.0 mgd
Avai�ability averege/ average/10.0 average/2.0 average/133 average/OA
Previously 13.33 mgd mgd peak mgd peak mgd peak mgd peak
Requested by peak
the 4 Cities
Additional 0.8 mgd 0.5 mgd 0.0 mgd 0.3 mgd 0.0 mgd
Capacity in . average/ aVerage/0.0 average/0.0 averege/0.0 averege/0.0
Substitute Offer 0.00 mgd mgd peak mgd peak mgd peak. mgd peak
peak �
Previous 0.7 mgd
Purchases average/2.0
mgd peak
[2.0 mgd peak
season with no
off-peak supply
requiresan
annualaverage
of 0.7 mgd to
be delivered]
Remoieing I0.0 riigd ' 7.5 mgd 0.8 rtrgd 1.0 mgd 0.0 mgd
Available overoge / overoge/10.0 overoge/0.0 overage/I.33 overage/0.0
,CdRacity foi 1333 mgd mgd peak mgd peok , mgd peak mgd peak
Purdrase Peak
AGREEMENT FOR THE PURCHASE AND SALE OF CREDTTS
RELATING TO FINITE WHOLESALE WATER SUPPLY CAPACITY
THIS AGREEMENT("A¢reement") is made and entered into as of tlus Ib'�-`day of -
St lkwbe r 2013 ("Effecdve Date"),by and between the City of Auburn, Washington
("Aubum"), and Cascade Water Alliance, a joint municipal utilities services authority organized
under Chapter39.106 RCW("Cascade"). The City and Cascade aze sometimes referred to
collectively as the "Parties" and individually as a "�."
RECTTALS
WHEREAS, in 2005, in order to meet Cascade's immediate and long-term water supply
needs,Cascade pw�chased&om Tacoma a supply of water both permanently and for a finite
period of years pursuant to an"Agreement for the Sale of Wholesale Water';
WHEREAS, on February 5,2010, Cascade and the Cities of Bonney Lake; Buckley,
Sumner and Auburn entered the 2010 Lake Tapps Area Water Resources Agreement(tlie "Four
Cities Aereement")that provided,among other things, for Cascade to assist the four cities in
meeting their projected 50-year water supply needs;
WHEREAS, on December3l, 2012,Cascade and Tacoma entered the.Amended and
Restated Agreemem for the Sale of Wholesale Water(the"Amended and Restated A�eemenY')
that provided, among other things, for Tacoma to make available to the four cities a water supply
to be purchased directly from Tacoma as a wholesale customer and to recognize credit for the
System Development Charges that Cascade kiad previously paid to Tacoma;
WHEREAS, Cascade and Tacoma sent a letter, dated February I 1, 2013,to inform
Auburn of the availability of the"substitute"water supply opportunity and related time
limitations and procedures for acting on the opportunity("Joint L.etter");
WHEREAS,Auburn timely approved,signed,and delivered the Confirmation Notice,
dated May 21, 2013,to confirm Auburn's election of the substitirte supply opportunity and iu
desire to purc&ase a System Development Charge Credit from Cascade as to the 6 MGD
Wholesale Water Supply ("Confirmation Notice");
WHEREAS, Cascade paid a capacity reservation fee to Tacoma that covers a portion of
the System Development Charge for 6 MGD Wholesale Water Supply and Auburn will owe
Tacoma the reinaining balance of any System Development Charges for Auburn's desired
quantity,net of the credit purchased from Cascade under this Agreement;
WHEREAS,the Joint Letter and Confirmation Notice are set forth in Exhibit A hereto
and aze incorporated by reference in thisAgreement;and
WHEREAS, the Parties have addressed thepurchase of credits for the permanent;or 4
MGD Wholesale V✓ater Supply, in a separate agreemgnt, and the Parties set forth their agreement
for purchase of credits for the 6 MGD Wholesale Water Supply in tlris Agreement.
NOW, Tf�REFORE, IN CONSIDERATION of the recitals stated above,which are
incorporated herein, and the mutual covenants and conditions herein contained,the Parties agree
as follows:
AGREEMENT
1. Definitions.
"6 MGD Wholesale Water Suunlv"means an average annual of 6 MGD wholesale water
supply from Tacoma,with a Peaking Factor of 1.33;and a maximum peak day of 7.98 MGD,all
as pmvided in the Amended and Restated Agreement. The 6 MGD Wholesale Water Supply is
the Tacoma supply of water for a finite period of years.
"Amended andRestated A�eement"means the"Amended and Restated Agreement for
the Sale of Wholesale Watec"by and among Cascade and the City of Tacoma, Department of
Public Utilities, Water Division, dated December 31;2012.
"Confirmation Notice"means the document, dated May 21, 2013, in wlrich Aubum
confirn►ed its election of the substitute supply opportunity in fulfillment of Cascade's obligation.
in the Four Cities Ageement to assist with Aubum's projected i0-yeat water supply needs
(attached in Exhibit A).
"Four Cities A�seement"means the "2010 Lake TappsArea Water Resources Agreement
among the Cities of Auburn, Bonney Lake, Buckley and Sumner,and Cascade Water Alliance,"
dated February 5,2010.
"MGD"means million gallons per day.
"Joint Letter"means the letter,datedFebruary 11, 2013,from Cascade and Tacoma to
Cities of Auburn,Bonney Lake, Buckley and Sumner that is attached hereto in Exhibit A.
"Notice of Confirmation of System Development Char eg CrediY'means a notice,given
by Cascade to Tacoma at the request of Auburn,confiiming the amount of the System
Development Charge Credit(if any)to be applied to the System Development Charge otherwise
due and payable by Aubum to Tacoma in connection with a wholesale water supply agreemem.
"SYStem Development Char¢e"or"SDC" means the system development charge
ia►posed upon wholesale customers by Tacoma in its wholesale water regulations.
"Svstem Develonment Charee Credit"means a credit to be applied in a wholesale water
supply agreement aoa+nc�the System Development Charge otherwise due and payable by
Aubum to Tacoma The System Developmeirt Charge Credit is expressed in million gallons per
day(MGD)units and in dollars.
"Tacoma"means the City of Tacoma;Department of Public Utilities, Water Division.
Page 2 of 11
2. Term of Agreement
This Agreement takes effect on the first date that both Parties have duly appmved,
si�ed, and delivered the Agreement to the other Party. The term of the Agreement will
coaunence on the effective date and will end on December 31,2029 or the date that Auburn has
fully paid Cascade for the price of the System Development Charge Credit consistent with
Sections 3 and 4 of tlris Ageement In the event that Auburn elects not to confirm a quantity
consistent with the teims of this Agreement or by nodc.e selects a quantity of zero (0.000 MGD),
then this Agreement will terminate.
3. Parchase of 6 MGD System Development Charge Credit& Price.
Subject to Section 5 of this Agreement,Aubum agrees to purchase and Cascade agrees to
sell a System Development Charge Credit regardiag the 6 MGD Wholesale Water Supply in a
maximum quantiry of up to 2.763 MGD.annual supply capacity(3.68 MGD peak supply
capacity). Aubutn shall confirm the specific quantity of the 6 MGD Wholesale V✓ater Supply it
will purchase in accordance with the procedure set forth in Section 5 below.
Until Auburn confums its System Development Charge Ctedit with Cascade cbnsistent
with Section 5 and enters a wholesale water supply agreement with Tacoma as set forth in the
Joint Letter, Aubum will not have access to.the 6 MGD VJholesale Water Supply. After Au6um
has confirmed its System Development Chazge Credit with Cascade consistent with Section 5
and entered a wholesale water supply agreement with Tacoma,then Aubum may begin to take
delive;y of wholesale water from Tacoma.
In consideration for said System Development Charge Credit,Aubum will pay to
Cascade a total price of$1,427,864.00,as of the date that tlris Agreement takes effect,for the
quantity of 2.763 MGD annual supply capaciry(3.68 MGD peak supply capacity). The parties
agree that Auburn will pay interest at an anni�al rate of 3.2%on the balance due begiuning in
2017 and continuing until the balance is fully paid and this Agreement terminates. Aubum will
pay the total price by making an annual payment in 2017-2029 according to the annual payment
schedule set forth in Section 4 below. This schedule incorporates interest at a rate of 3.2%on the
balance due,beginning in 2017. Under this schedule the total of annual payments including
interest is$1,977,128.00. In the event that Auburn confirms an amount less than the maximum
quanrity of 2.763 MGD annual supply capacity(3.68 MGD peak supply capacity),the total
applicable price and payment schedule will be adjusted downward on a pro rata basis. If Auburn
elecu not to confirm a quanrity, or by notice selects a quantity of zero (0.000 MGD),then no
paymeat shall be due.
4. Annual Payment Schedule.
Auburn will make annual installment payments to Cascade to pay for the System
Development Charge Credit as to the 6 MGD Wholesale Water Supply. In the event that Auburn
purchases a System Development Charge Credit in the quantity of 2.763 MGD annual supply
capacity(3.68 MGD peak supply capacity),then the following payment schedule shall apply:
Page 3 of I 1
Pavment Schedule
„ .... . , - -
.�• —
�: Year . , - , Amount. �' ��"";- YearF �' „ � Amount
_� � - � x� .. ,._ ,,__ - :.
2014 0 2022 $45,692
2015 0 2023 $45,692
2016 0 2024 $45,692
2017 $45,692 2025 $45,692
2018 $45,692 2026 $45,692
2019 $45,692 2027 $506,736
2020 $45,692 2028 $506,736
2021 $45,692 2029 $506,736
Total $1,977,128
In the event that Auburn purchases a System Development Charge Credit in a quantity less than
2.763 MGD annual supply capacity,then the Earties sha11 calculate and determine the applicable
total price and payment schedule and the Parties shall agee on an apdated payment schedule that
will be documented as Exhibit B to this Ageement.
Each year the annual payment shall due and payable by Aubum to Cascade on or 6efore
June 30 of the yeaz in wluch such payment is due. If full payment of any annual payment is not
received by Cascade on or before the date due, such payment shall be considered past due,and
the unpaid amount shall accrue interest,from the date due until the date paid,at a rate per day
equal to 0.03 percent per day. Upon not less than fifteen(15) days' advance notice to Cascade,
the City may in any given yeaz prepay without penalty any one or more of the next successive
annual paymems. Upon such notice,Cascade will provide Aubum documentation of the amount
due for such payment,and adjustments to any remaining payment schedule, net of related
interest incorporated into the above payment schedule..
5. Auburu Confirmation of Purchase Quantity & Termination Right
On or before June 30,2017,Auburn shall give notice to Cascade as to the specific
quaatity of the System Development Chazge Ctedit that it will purchase,up to a maximum of
2.763 MGD annual supply capacity (3.68 MGD peak supply capacity). Aubum's notice must
identify and confirm one of the following three courses of action:
Page 4 of 11
a) Aubum confirms purchase of a System Development Charge Credit in the
quaatity of 2.763 MGD annual supply capacity(3.68 MGD peak supply capacity).
b) Aubum confirms purchase of a System Development Charge Credit in a specific
quantity less than 2.763 MGD annual supply capacity (peak supply capacity to be
determined by Cascade).
c) Aubum confirms that it will not purchase an SDC Credit as to the 6 MGD
Wholesale Water Supply,in which eveat this Agreement shall terminaie and,except for
Section 9, be of no further force or effect
If Auburn failsto give such nofice to Cascade by June 30,2017, or by notice selects a
quandty of zero (0.000 MGD),then no payment shall be due and this Agreement will terminate.
In order to facilitate communications,the Parties agree to meet and confer during the
month of March 2017, or before, about status of water supply planning and this Agreement.
6. Notice of Confirmation of System Development Charge Credik
Within 30 days after Aubum gives iu notice to Cascade under Secrion 5 of this
Agreement,Cascade will send to the Tacoma Water Superintendent a Notice of Confirmation of
System Development Charge Credit regarding the 6 MGD Wholesale Water Supply. Cascade
will provide a copy of the Notice to Aubtun when it is sent to Tacoma.
7. Terms and Conditions of 6 MGD System Development Charge Credit
Aubum aclmowledges that, as stated in the Amended and Restated Agreement, Cascade
has paid to Tacoma a capacity reservation fee(i.e., $1,570,074.00 per MGD)for the 6 MGD
Wholesale Water Supply that Tacoma will recognize as an System Development Charge Credit
if ali requirements of the Amended anil Restated Agreement and the Joint Letter aze met.
However,the capacity reservation fee paid to Tacoma by Cascade covers only a portion of the
System Development Charge for the 6 MGD Wholesale Water Supply. Accordingly, Auburn
specifically acknowledges and agrees that it will pay Tacoma the rPma;n;ng balance of any
System Development Charges owing for Auburn's desiredquantiry,net of the SDC Credit
obtaine.d from Cascade. Auburn specifically acknowledges and agrees that Tacoma's SDC could
increase and that Auburn will beaz any increase in Tacoma's 3DCs that may take effect before
Aubum and Tacoma enter a wholesale watersupply agreement
Aubum understands that additional SDC payments to Tacoma will be required to convert
the 6 MGD Wholesale Water Supplyto permaneat.supply, in the event Aubiun elects to do so
pursuant w a firture Auburn-Tacoma agreement: As an example calculation of:Auburn's
combined costs based on Tacoma's cuaent SDC,the Parties have included an illuslrative
exaznple in Exlribit C attached hereto. Exhibit C is not binding on any Party orTacoma; and
Exlubit C contains assumptions about Tacoina's SDC and iaterest rates in the futu=e that may or
may not tum out to be accurate. Accordingly, Cascade makes no representadons or warranties
about the accuracy of Exlubit C.
Page 5 of 11
8. Wholesale Water Supply Purchase Negotiations with Tacoma
In order to use the System Development Charge Credit and secure a wholesale water
supply from Tacoma,Auburn aclmowledges that it must make an offer,complete negotiations,
and enter a wholesale water.supply agreement with Tacoma consistent with the Joint Letter and
Gonfirmation Notice set forth in Exhibit A and with the Amended and Restated Agreement.
Auburn aclmowledges and agrees that Cascade makes no representadons or warranties as to the
outcome of such negotiations,the Tacoma wholesale water supply that Auburn may(or may not)
be able to purchase;or otherwise.
9. Effect on Four Cities Agreement.
The Parties agree that tlris Agreement constitutes full performance by Cascade of its
obligations under Section 3(a)of the Four Cities Agreement Accordingly, Section 3(a)of the
Four Cities Agreement shall be of no further force or effect as between Cascade and Aubum.
Other provisions of the Fow Cities Agreement are unaffected by this Agreement and remain
effective according to iheir terms. This section 9 shall survive termination of the Agreement in
the event that Aubum elects not to purchase an SDC Credit.
10. Notices.
All notices and payments hereunder may be delivered or mailed. If mailed, they shall be ,
sent to the following respective addresses:
Cascade Water Alliance: City of Auburn:
520 112th Avenue NE, Suite 400 Atta; Deffiis Dowdy
BeIlewe,Washington 98004 25 W Main St
Attn: Chief Executive Officer Aubwn WA 98001
Phone: (425)453-0930 Phone: (253)931-3010
Fa�i: (425)425-453-0953 Fax: (253)931-3053
A Party may change its address from time to time by providing notice to the other Parry. All notices
and payments tnailed by regular post(including first class)shall be deemed to have:been given on
the second business day following the date of mailing,if properly mailed and addressed. Notices
and payments sent by certified or registered mail shall be deemed to have.been given on the next
business day following the date of mailing,if properly mailed and addressed For all types of mail,
the postmark affixed by the United States Postal Service shall be conclusive evidence of the date of
mailing.
11. Dispute Resolation.
In the event that any dispute arises between Cascade and Auburn,the aggrieved Party
shall give a notice of the dispute to the other Pariy. Cascade and Auburn shall,within five (5)
days of such notice, each nominate a senior officer of its management to meet at a mutually
agreed location,to attempt to resolve such dispute. The Parties shall each designate a
representative(s)to confer on the best and most cost effective way to resolve the dispute. By
Page 6 of 11
mutuai agreement,they may choose direct negoriations or mediation. If there is no agreement
between the Parties on how to proceed within tlrirry(30)days, either Party may pursue legal
action; provided, howeyer,no Party shall beprecluded from filing an appeal or action to prevent
the expiration of a time period for filing or any statute of limitations.
If a Party fails to perform iu obligations hereunder,then it shall be in default hereunder
unless the defaulting Party cures an event of default, whether monetary or non-monetary,within
thirty(30) days after receiving written notice from the other Party of such default.
Subject.to theprocedures set forth in Section 9(Dispute Resolution),if a Party is in
breach or default of its obligations arising under this Agreement,the other Parry shail have and
shall be entitled to exercise any and all remedies available to it at law or in equity(including the
right to specifically enforce this Agreement), all of wlrich remedies shall be cumulative.
12. Attorneys'Fees.
If any Party shall be required to bting any action to enforce any provision of tkris Agreement,
or shall be requirai to defend any action brought by the other Party with respect to this Ageement,
and in the fw�ther event that one Parry shall substantially prevail in such actioq the losing Party
sliall,in addition to all other payments required.therein,pay a11 of the prevailing Party's reasonable
costs ia connection with such action,including suoh sums as the court or courts may adjudge
ceasonable as attomey's fees in the trial court and in any appellate courn.
13. No Assi�ment
Ttqs Agreement is specific to the Parties and may not be assigned in whole or in part.
14. Nou-Waiver.
No delay or failure by a Party to exercise any of its rights,powers or remedies under this
Agreement following any breach by another Party shall be construed to be a waiver of any such
breach, or any acquiescence therein,or of or in any similar breach thereafteroccurring, nor shail
any waiver of any single breach be deemed a waiver of any other breach theretofore or thereafter
occurring.
15. No Third Party Beneficiary.
Tlus Agreement is for the sole and exclusive benefit of the Parties and is not intended to
and shall not confer any rights or benefits on any third party not a signatory hereto.
16. Integrated?►greement.
This Ageement constitutes the entire agreement between the Parties with respect to the
subject matter heceof and supersedes all prior or comempoianeous understandings or agreements
with respect thereto;provided,however,that this Agreement shall be interpreted or construed
together with the Amended and Restated Agreement,the Joint Letter, and the Confirmarion
Notice. No modifications or amendments of this Agreement shall be valid or effective iwless
evidenced by an ageement in writing signed by the Parties.
Page 7 of 11
17. Signature in Counterparts.
This Agreement may be executed in counterparts and all of those counterparts taken
together shall constitute one and the same instrument
18. Representations of the Parties.
Each Party represents and warrants that:it has duly approved, executed, and delivered tlus
Agreement and that it has all necessary authority to enter iaw this Agreement and to perform its
terms and obligations. Each Party represents aud warcauts that the approval,execution, and
delivery have been duly authorized by the appropriate boazd or council,and no otfier act or
proceeding on the part of any Party is necessary to authorize:entry iato or performance of diis
Agreement.
IN WITNESS WHEREOF,the Parties have duly executed this Agreement as of the
Effective Date.
City of ubu Cascade Water Allianc�/���(:��"""`
r- �
By: - By: Chuck Clazke
TiUe: �I�ya.e Title: Chief Executive 0fficer
�
Date: SEP 10 2013 Date: 9��//�
ATTEST
�
��
City Clerk
APPR • AS TO FORM
�t'' City A orney
Page 8 of 11
Ez6ibit A
(Joint Letter signed by Cascade and Tacoma,dated February 1 I,2013,and the
Confirmation Notice sigried by Auburn,dated May 21,2013.]
.. �!'ir.,.
q
� �
CASCADE � �
�b'ATfR AI. I IANi- F WATER
T�CON� lY�tlt YTIL�T�E!
February 11, 2013
The Honorable Pete Lewis The Honorable Pat Johnson
City of Auburn City of Buckley
25 West Main Street 933 Main Street
Auburn, WA 98001 Buckley, WA 98321
The FIonorable Neil7ohnson The Honorable Dave Enslow
City of Bonney Lake City of Sumner
19306 Bonney L.ake Blvd. 1104 Maple Stireet
Bonney Lake,WA 98391 Sumner, WA 98390
Re: Cascade Warer Alliance and Tacoma Water Substitute Wholesale Water Supply
Availability—Time is of the Essence(Sent by Email and US Main �
Dear Mayors:
As you may be aware,the Cascade Water Allianbe and City of Tacoma have been in ongoing
discussions about potential changes to the 2005 Water Supply A�eement. In Iate2012 a new
agreement was reached and signed which benefits not only Tacoma and Cascade but also the
Four Cities of Aubum,Bonney Lake,Buckley aad Sumner: This new agreement preserves the
right of the four cities under the 2009 Cascade/Four Cities Agi�eement and allows a new time
sensitive supply option to be jointly offered to the fo�cities from Cascade and Tacoma.
T'he Cascade Water Alliance(Cascade), in cooperation with Tacoma Water, is offering the
avaiiability of a substitute wholesale water supply("Substitute Suppiy")and to provide this
notice of a limited period of time for your Cities to take action on this uniquc opportuaity.
Cascade and Tacoma have entered 'mto a Restated and Amended Ageement for the Sale of
VJholesale Water,wlrich replaces the Z005 ageement between the parties for purchase and sale
of wholesale water. The 2005 agreenie:rt is included as one of the"water supply assisfance"
measures in the 2010 Lake Tapps Area Water Resoiuces Agreement between Cascade and your
cities(the"Four Cities AgeemenY').
In the Restated and Amended Ageement, Cascade has agreed to relinquish its right to take
delivery of tfie Substitute Supply: This wator'is now available to the Cities to purchase direcUy
from Tacoma as a wholesale customer. Cascade has,however,previously paid capaciiy charges
for this w+holesale water supply. If yoiu City now desires to purchase the Substitute Supply
di=ectly from Tacoma and iskes action described in this letter,Cascade is willing to sell yonr
City a credit(reflecting the amounu that Cascade has preriously paid to Tacoma)that can be
Joint L,ettc to the Four Cities
Febmary 11, 2013
Page 2
applied against SystemDevelopment Charges that would otherwise be due to Tacoma("SDC
Credit"). The amount and availability of any SDC Credit will be detcrmined by Cascade in
accordance with the terms sct forth in the Confirmation Notice that is attached to tliis letter. You
must act prompdy, however, in order to secure the opportunity to obtain an SDC Credit&om
Cascade.
This letter pro�•ides Cascade's formal notice of the limited window of time for your City to act,
the Confirmation Notice that you must retum to Cascade to apply for a SDC Credit, and general
guidance as to how Cascade and Tacoma intend to cooperate to facilitate the implementation of
the Restated and Amended Ageement.
Limited Time to Act
You must act within ]20 days from the first meeting of Tacoma, Cascade and the Four Cities to
wnfirm your interest in this opportunity by deliveriag a signed "Confirmarion Notice"to
Cascade in the form attached to this letter. This opportunity expires at the end of 120 days.
' During this 120-day period,the quantity allocation among and between the Four Ciries.as stated
in the Four Ciries letter to Cascade, dated February 5;201 Q shall be recognized by Cascade and
shall determine the maximum allocation of the Substitute Supply(and the Residual Wholesale
Water Supply) among the Cities (unless the Four Cities jointly agree to reallocation in
accordance with the Four Ciries Agreement). A Cityhas until the expiration date to deliver an
executed Confirmation Norice to Cascade. If you select this opportunity by acting witivn the 120
days,then you have until March 1,2018 to purchase (or agree to purchase) an SDC Credit from
Cascade. (In anticipation of the required steps with Tacoma described below, it is advisable for
your City to complete the SDC purohase agreement with Cascade in advance of Mazch 2018 to
allow yonr City adequate time for the Tawma steps.) If you select this opportunity by acting
within the lZO days,then you will also have until March 1,2018 to submit a Wholesale Water
Ag;eement.with Tacoma that is eligible for the SDC Credit.
If you do not confirm your selection by delivering a Confirmation Notice to Cascade by the
deadline, then.you decline the Substitute Supply opportunity stated.in this letter. In that event,
you will still be able to purchase wholesale water supply(if any water supply capacity remains
available) from Tacoma on terms consistent with Section 3(a)ofthe Four Cities Agrecment.
Howevcr,you will not be eligible for an SDC Credit.
NexYSteps with Cascade
If you d'eliver the Confirmation Notice within the 120-day deadline stated above:and select tfiis
Substitute Supply opportunity,then you will need to complete the following steps with Cascade:
(a) Confirmation to Casoade that your City will proceed with the Substitute
Supply opporiunity stated herein, and that it fiilly substitutes for Section
3(a)of the Four Cities Agreement which wi11 have no fiuther force or
effed.
(b} Agree with Cascade for payment terms to Cascade for the SDC credit.
Joint Letter to the Four Cities
February 1 I,2013
Page 3
(c) Upon completion of the items in (a) and(b)above, Cascade will send
Notice of Confirmation of System Development Chazge Credit to Tacoma.
Next Steps with Tacoma Water
If you deliver.the Confirmation Notice to Cascade within the deadline stated above and select
this opportunity,then you would also need to complete the following steps with Tacoma in order
to submit a rimely offer to pwchase all or a portion of the Substitute Supply. The procalures and
requirements that must be followed to submit such an offer aze set forth in Section 6 and Section
7 of the Restated and Amended Agreement (attached for reference). It is important to read these
procedures and requirements carefully as any offer you make must be in strict compliance with
these procedures and requirements. These procedures and requirements aze briefly summarized
as follows:
(a) In order to obtain a SDC Credit, Tacoma must be in receipt of a Notice of
Confirmation of System Developrrient Charge Credit&om Cascade:
(b) Prior to submitting youroffer to purchase water from Tacoma, you must
obtain Tacoma's wrihen review and approval of the Wholesale Water
Supply Agreement (including any proposad modifications thereo�
pursuant to which such offer is to be made to Tacoma.
(c) Your offer to Tacoma must be submitted in the form of duplicate
executed originals of the Wholesale Water Supply Agreement,in sfict
conformity with'the form of the Wholesale Water Supply Agreement
approved by Tawma.
(d) No )ater than March 1,2018, you must deliver your offer to Tacoma,
Attention: Water Superintendent,Tacoma Water, 3628 South 35,th Street,
Tacoma, WA 98409, and obtain Tacoma's acknowledgment of the time
and date of Tacoma's receipt of snc6 offer:
Clarifications
While we are pleased to present this opportunity to your City, we want to avoid any confusion as
to what this opportunity is and is not. For avoidance of doubt,this letter does not constitute a
modification or waiver of any of the pmcedures or requiremenu set forth in the Restated and
Amended Ageement. This letter does not consiitute an offerby Tacoma to sell a wholesale
water supply to any person or entity. Any such sale by Tacoma is subject to and contingent upon
the negotiation, execution and delivery of a mutually acceptable Wholesale Water Supply
Ageement.
Conclusion
Cascade and Tacoma aze pleased to pmvide the availability of Substitute Supply, and look
forward to receiving your offer to purchase, sfiould you desire to do so, in accordance with the
]oint Lctter to t6e Four Cities
February 11,2013
Page 4
guidelines set forth above. We will be contacting your office within the next week ro schedule a
meeting to present and discuss this opportunity.
Sincerely,
�:��cwG ����C. . , ��,�?2� (iLcz�
Chuck Clarke Linda A. McCrea
Chief Executivc(�fficcr Superintendent
Cascade Water Alliance Tacoma Water
Joint Letter to tho Four Cities
February ]1,2013
Page 5
Confirmation Notice
To Be Delivered to Cascade Water Alliance 120 days From the First Meeting of Tacoma,
Cascade and The Fow Cities
The City of ("City")confirms receipt of the letter, dated , from
Cascade Water Alliance ("Cascade")and Tacoma.Water presenting the availability of a
substitute wholesale water supply ("Substitute.Suppiy"�. The Ciry understands that the
Substitute Supply is an alternative to the provisions of Saction 3(a)of the20]0 Lake Tapps Area
Water Resources Agreement between Cascade and the Ciries"of Aubum, Bonney Lake, Buckley,
and Sumner(the "Four Cities AgreemenP'). The Ciry understands that the Substitute Supply
requires the Ciry to entcr a wholesale water supply agreement with Tacoma Water to:be
negotiated and offered to Tacoma Water by March l,2018 as described in the above-referenced
letter. The City understands that Cascade WateT Alliance is offering to sell a System.
Development Chazge Credit to the City on the temis and condirions stated on Exhibit l attached
hereto,provided that by March T;2018 Cascade and the City need to enter.an agreement to
confirm the purchase and sale and Cascade's provision of a Notice of Confirmation of System
Development Charge("SDC") Credit to Tacoma Water.
Now, therefore, the City of hereby confirms and agrees as follows:
(a) The Cit�•the elects the "Substitute Supply"opportunity described herein as an alternative
that fully substitutes for section 3(a) of the Four Cities Agroement.
(b) The Ciry provides this Confirmation Notice with respect to the following portion ofthe
Substitute Supp]y:
4 MGD wholesale supply:
6 MGD wholesale supply:
(c) By selecting the"Substitute Supply"altemative,the City agees thaz Cascade has fully
perf�rmed and satisfied all obligations to the City undet 3(a) of the Four Cities agreement.
- (d) The City agrees that section 3(a) of the Four Cities Agreement shallbe of no further force
or effect as between Cascade and the City.
(e) The City and Cascade shall proceed with diligence to negotiate an agreement for purchase
of an SDC Credit consistent with the terms ouUined in Exhibit 1.
CONFIRMED,ACCEPTED AND AGREED TO BY THE CITY OF on
this day of , 20]3:
BY
[Namel
Mayor
w
C1TY OF ' .
���U Peter B. Lewis, Mayor
� WASHINGTON 25 West Main Sheet * Auburn WA 98001-4998 * www.auburnwa.gov * 253-931-3000
A4ay 21. 2013
Cascude Water Alliance
Attn: Chuck Clarke, Chief Executive Officer -
520 1 12`� Avenue NE, Suite 400
Beilevue, Washington 98004
Re: Confirmation Notice—City of Auburn's Response to Cascade's Offer of Substitute
Supply
Dear Mr. Ciarke,
On May 6`h, 2013 the Aubum City CounciLapproved Resolution 4951 authorizing the City of
Au6um lo begin negotiations avith Cascade Water AUiance.in response to your February 1 I,
2U13 offer.
Fnclo;ed pleasc fircl a signed origi!111 ofthe City's confirmation notice.
UurPu6lic Works L)irector wili !x in touch w•ith �ou sex�n to be�in discussion of'the city's
desims to makt use of the Substitute Supply.
S'�ricere y,
� - �. �._
� , ��
Petc E.ewis
!ylayor
Enclosures
cc: Dennis Dowdy, Directorbf Public Works
Received
MAY 232015
AUBURN * MORE THAN YOU fMAGINED
Confirmation Nodce
To Be Delivered to Cascade VJater AIliance 120 daysFrom the First Meeting of
Tacoma, Cascad"e and The Four Cities
The City of Auburn("City") confirms receipt of the letter, dated February I 1, 2013, from
Cascade Water Alliance ("Cascade")and Tacoma Water presenUng the availability of a
substitute whotesale water supply("Substitute Supply"). The City imderstands that the
Substitute Supply is an alternative to the provisions of Section 3(a) of the 2010 Lake Tapps Area
Water Resources Agreement between Cascade and the Cities of Aubum, Bonney Lake,
Buckley, and 5umner(the "Four Cities Ageement"). The City understands that the Substitute
Supply aequires the City to enter a w}iolesale water supply agreement with Tacoma Water to be
negotiated and offezed to Tacoma Water:by March 1,2018 as described in the above-referenced
letter. The City understands that Cascade Water Alliance is offering to sel] a System
Development Charge Credit to the City on the terms and condirions stated on Exhibit 1 attached
hereto,pmvided that by March 1,2018 Gascade and tlie City need to enter an agreement to
confirm the purchase and sale and Cascade's provision of a Notice of Confirmation of System
Development Charge ("SDC") Credit to Tacoma Water:
Now, there fore, the Ciry of Aubum herebv confirms and agiees as follows:
(a) 7'he Citythe elects the "Substitute Supply" opportunity described herein as an
altemative that fully substitutes for section 3(a) of the Four Cities Agreement provided
that the City can negotiate acceptable terms with Cascade to provide and finance the
necessary water supply SDC credits.
(b) The Ciryprovides this Confirmation Notice with respect to the following portion of the
Substitute Supply:
4 MGD wholesale supply: 4 MGD
6 MGD wholesale supply: Possible option of 3 MGD
(c) By selecting the "Substitute Supply" altemative, the City agrees that upon execution of a
new Substitute Supply agreement with Cascade to provide SDC Credits foi 4 MGD of
supply, Cascade will have fully performed and satisfied all obligations to the City under
3{a) of the Four Cities agreement.
(d) The City agees that section3(a)of the Four Cities Agreement shall be of no further
force or effect as between Cascade and the Ciry when a new substitute supply agreement
with Cascade is executed.
(e} The City and Cascade shall proceed with diligence to negotiate an agreement for
purchase of an SDC Credit consistent with the terms outlined in Exhibit I (Attached).
CONFIRMED, ACCEPTED AND AGREED TO BY THE CITY OF AUBURN on this
2151 day of May, 2013:
�—
By:
Pete Lewis, ayor
E�chibit i
TERMS FOR 4 CITIES SUBSTITUTE SUPPLY OFFER
L This offer is structured to fulfill Cascade's obtigations to make available Tacoma water as
described in the existing"4 Cities AgreemenY". Availability of the terms of this offer is
contingent upon written acceptance of the substitution of this supply afferfor the
commitment defined in Section 3.a of fhat 4 Cities Agreement speciflcally:
a. Paragraph 3A, providing options for purchase of Cascade's contrected Tacoma supply
capacity, is replaced by the substitute capacity offer defined in this proposal.
b. Paregraph 3A is confirmed in writing to be fully sati�ed by acceptance of this substitute
capacity offer.
c. Upon expiration of the substitute capaciry offer on December 31, 2017,all Cascade
obligations to make Tacomawater ayailable are deemed fulfilled and terminated.
d. The substitute capacity offer must be accepted and executed no later than 120 days from
the first meeting of Tacoma, Cascade and the Four Cities and the offer is withdrawn after
expiration date. (Actual commitment to purchase water under those terms, once
accepted,can occur anytime through 2017 as further delineated in section Ii.c below.]
II. Substitute Capaciry Offer
a. The following capacityis made availabie:
i. 9.3 mgd of averagesupply and a peak supply of 11.3 mgd. [7his is theremaining
available capacity of Cascade's purchases from Tacoma.]
ii: Cascade offers all capacity as firm and permanent. Cascade will be responsible
for any transactions neeifed to convert reserve capaciry to permanent capacity.
iii. All capacity will be offered as year-round capaciry with the following structure:
for each 1 mgd of year-round capacity,a peak season retio of up to 1.33 willbe
available for purchase: The'peak:annual ratio of 1.33:1.0 is based on the Tacoma
capacity owned by Cascade, whicFi originally totaled 10 mgd annual average and
133 mgd peak season. Cities may elect peak ratios ranging from 1.0 to 1.33,
subject to total capacity limits defined in the attached table.
iv. Tacoma will provide wholesale service contingent on execution of a wholesale
supply ag�eement defining terms for service and related charges. A sample
agreement form is provided.
b. The following price and financial terms are offered:
i. Capacity will be offered at a price of 75%of the SDC($3:17 per gallon * 75%=
$23775 per gallon)originally paid by Cascade., This charge wili apply to annual
capacity and to incremental peakseason capacity.
1. For example,for a purchase of 1 mgd annual/13 mgd peak season,the
cost will be 1 mgd • $2.3775 million+03 mgd '$2:3775 million=
$3,090,750. A purchase of 1 mgd annual with no peak season increment
would coSt$2,377,SOU.
ii. Payments for capacity purchase will be to Cascade; when the purchase inyolyes
conversion of reserve capacity, Cascade may opt to direct alt or part of the
payment to Tacoma.
iii. For each purchase,the following financing terms are available:
1. Full payment of purchase price upon execution of purchase;or
2. Paymentof20%ofpurchasepriceuponexecution; remainderfinanced.
on a note over 5 yearsat 3:3%interest with level annual payments due �
upon each anniversary date. Purchaser would be free to pay off note at
any time.
iv. Wholesale retes for service and delivery are as defined by agreement with
Tacoma (see also below).
c. The following schedule appiies to the substitute offer:
i. The substitute capacity offer must be accepted and executed no later than 120
days after the first meeting of Tacoma, Cascade and the Four Citiesand the offer
is withdrawn after ezpiration date. If not accepted during this period,then the
existing terms of paragraph 3.a would remain in effed.
ii. During the period fiom execution of this substitute offer until Decem6er 31,
2015,each City may eiect to purchase itsrelated share of wpacity aiany time.
Shares of capacity can also be re-assigned upon notice provided to Cascade by
both parties of such intenL
iii. Beginning January 1, 2016 and extending through December 31„2017,any City
may offer to purchase any or all capaciry remaining available on a first come,first
serve basis. Cascade wiil notify the Cities of available capacityearlyin 2016.
iv. After December 31, 2017,no substitute supply capacity will be available.
v. Participants in thissubstifute capacity offer are free to transfer rights to purchase
to other participants,but only to other participants, provided that Cascade
receives clear and binding direction to this effect from both parties.
III. Speelal9[uation: Bonney Lake previouslyacquired 2 mgd of peakseason (June-September)
capacity, with no right of ser4ice in the off-peak period. This is equivalent in quantiry to 2.0
mgd peak and 0.7 mgd average annual. This leaves related off-peak capacity with no
corresponding right of service.in the peak period.
1. Bonney Lake is offered revision of this capaciry right to 2 mgd peak
together with 1.50 mgd annual capacity.
2. This offer to revise the capacity structure is made available for 90 days
after the effective date of Bonney Lake's acceptance of the substitute ,
capacity offer.
3. Purchase Price for this revision is the extension of existing paymentsby
one year(to inciude 2019),a net cost addition of$391,222.
4. If Bonney Wke does not approve this extension prior to the expiration
date, then other parties are free to acquire the related off-peak capaciry
as a part of a year-rountl capacity purchase at an incremental price of
$391,222.
IV. Integration of Cascade and Tacoma obligations under this substitute capaciry offer:
a. Ardefined in the revised agreement between Cascade and Tacoma, it is the intent of _
Cascade and Tacoma thatany purchases under this offer are subject to execution of an
agreement for wholesale service with Tacoma. Cascade would have no ongoing role in
delivering wholesale water after execution of such agreement with Tacoma.
b. Tacoma will commit tosuppty water purchased'under this agreement,subject to
execution of a wholesale wateragreementaccepfableSO Tacoma and generally defined in
a draft wholesale agreement.
i. Tacoma wiil work with the purchaser to establish a mutually acceptable delivery
point or points,to be defined in the wholesale wateragreement.
ii. No SDCs will be due to Tacoma for water cappciry purchased;under this
agreement. .
iii. The purchaser will be subject to Tacoma wholesale retes.
Substitute Offer of Available Tacoma Supply Gpacity
_ _ . _ . _ ___
Total Auburn Bonney Lake Budcley Sumner
Capacity 91 mgd 7.0 mgd 1Smgd 0.7 mgd 0.0 mgd
Availability averege/ average/10:0 average/2A averege/1.33 average/0.0
' Previously 1333 mgd mgd peak mgd peak mgd peak mgd peak
Requested by peak
the 4 Cities
Additional 0.8 mgd 0.5 mgd 0.0 mgd 03 mgd 0.0 mgd
Capacity in average/ average/0.0 average/0.0 averege/0.0 aVerage/OA
Sub"stitute Offer , 0.00 mgd mgd peak mgd peak mgd peak. mgd peak
peak
Previous 0.7 mgd
Purchases average/2.0
mgd peak
[z•0 mgd peak
season with no
off-peak supply
requires an
annuai averege
of 0.7 mgd to
be delivered]_ '
Remaining . 10.0 mgd 7.5 mgd 0.8 mgd 1.0 mgd 0.0 mgd .
Avaifable cveroge / avemge/10.0 avemge/0.0 ove�oge/1:33 average/0.0
Copaciry fo� 13.33 mgd mgd peok mgd peok mgd peok mgd peak
Purchase peak
EahibitB
Updated Annual Pavment Schedule
(To be completed by the Parties in the event Auburn confirms the purchase of
an SDC credit in a guantity less than 2.763 MGD annual supply capacity)
� .T.V. �3 S. C� �t 'G't LM ����
o Yeai�i ," �n ``Amouuth,
� ;�.,. _��.�_ � rts�_...
2014 0
2015 0
2016 0
2017 $
2018 $
2019 $
2020 $
2021 $
2022 $
2023 $
2024 $
2025 $
2026 $
2027 $
2028 $
2029 $ _
Total $
Page 10 of I 1
Ealtibit C
Illustrative Example of Total Auburn SDG Payments for Reserve Capaciry
Year Payment to Cascade EstimnfedPayment Total Estimated
Yo Tacoma SDC Payment
2014 $0 SO $0
2015 $0 $0 $0
2016 , $0 $0 $0
2017 I $45,692 $134,183 $279,974.
2018 I, $45,692 $234,183 5279,974
2019 545,692 5234,283 $279,974
2020 $45,692 51;183,994 $1,229,686
2021 $45,692 51;183,994 $1,229,686'
2022 $45.692 51:183.994 $1,229,686
2023 $45,692 $1,183,994 $1,229,686
2024 $45,692 51,183,994 $1,229,686
2025 $45,692 $1,183,994 51,229,686
2026 $45,692 $1;183,994 $1,229,686
2027 $506,736 $0 5506,736
:2028 $506,736 $0 $506,736 �
2029 $506,736 SO $506,736
Notes:
1) Estimated 7aymeM to Tacoma iz based an Me followfng assumptions which are not assured:a)the current
SDC;b)an irrteres[rate of 3.2%;and c)a noteterm of 10 years strtic[ured with the first ttiree years bearing
onty iMerest payments. Actual payments will be subject to Auburn's completion of a wholesaie suppty
agreement wfth Tawma and related terms.
2) Does nut InGude eztimates of ae[ual water rates for wholesale servlce from Ta�ma.
Page I 1 of 11
�
CA S CA D E
WATER ALLIANCE
C/jy
C/)y�,��R�s�,�''�
�tr � �FF�C
Board of Directors September 23, 2013 L� c��� F
Chair
John Marchione �
�YOf Shavm Campbell
City of Redmond
Deputy CiEy Clerk
vice-cna�� City of Autium
Jim Haggerton Z3 West.Main Street
� . .. . .. . .. ...
CityofTUkwila /4�JbUR1, 1NA 880U1
Seuetaryrtreasurer
F,�a B,nie, DearShavm:
Depury Council Presiderrt
City of Issaqua� A��ed�for your file are signed originals�of the agreemerris between Cascade -
oo�oa�w5o� Water Alliance and the City of Aubum for the purchase and sale of credits relating
counci�member to pertnanern and reserVe vuholesate virater supply capaaty.
Ciry of Bellevue ,
Penny Sweet $IfICBfB�y, .
Councilmembar �/�����t/'�t��_ '_ — ` _
City of Kirkland �
Lloyd Warren ,
Commissioner ChUCk CI811CB
Sammamish Plateau
Water&Sewer District Chief�Executive �cer .
Jon Ault
Commissioner � . �
Skyway
Water&Sewer District
Chiei Execudve Officer
' Chuck Clarke
520 112'"Avenue NE — Suite 400 — Bellevue,WA 98004
- Phone: 425.453.0930 — Fax:425.453.0953
Webstte: xtivw.pscadewater.org