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R-02-09-26-11D9 - 9/26/2002SEP -06 -2002 15:49 FROM: •ki Brazos River Authority July 25, 2002 Mr. Nyle Maxwell, Mayor City of Round Rock 221 Bast Main Round Rock, Texas 78664 Re: System Water Availability Agecmcnt For Colorado River Basin Water Between Brazos River Authority and City of Round Rock Dear Mayor Maxwell: Per an Email request from Jinn Nose on April 1, 2002, the Authority has prepared a contract to provide the City of Round Rock with an additional 4,500 acre -feet of surface water. The water reserved in this contract is a portion of the 25,000 acre -feet acquired from the Lower Colorado River Authority by the Brazos River Authority. The Authority values the City of Round Rock as a water customer and looks forward to meeting your future water demands. Enclosed please find two (2) copies of the above - referenced Agreement. Please sign and return both copies. I will return one fully executed copy after signature by General Manager /CEO Phillip Ford. If you have any questions, feel free to contact me at (254) 761 -3166. incercly, J i I N BAKER and Manager, Central Basin JB:jls Enclosures rz+®,•dbaWµphAmnM,e nwwloodxre f N WA& 4600 Cobbs Drive • P.O. Box 7555 • Waco. Texas 76714 -7555 254 - 761 -3100 • FAX 254-761-3215 TO:5122105563 P.002'016 QUAUTY • CONSERVATION • SERVICE COPY 09/06/2002 FRI 15:50 [TX /RX NO 95701 a002 Mayor Nyle Maxwell Mayor Pro-tem Tom Nielson Council Members Man McGraw Carrie Pitt Scot Knight Isabel Gallahan Gary Coe City Manager Robert L. Bennett, Jr. City Attorney Stephan L. Sheets ROUND ROCK, TEXAS PURPOSE. PASSION. PROSPERITY October 21, 2002 Mr. Phillip J. Ford General Manager /CEO Brazos River Authority 4600 Cobbs Drive Waco, TX 78714 -7555 Dear Mr. Ford: The Round Rock City Council approved Resolution No. R- 02- 09 -26- 11D9 at their regularly scheduled meeting on September 26, 2002. This resolution approves a System Water Availability agreement for colorado River Basin Water between Brazos River Authority and City of Round Rock for the purchase of an additional 4,500 acre -feet of water per fiscal year from the Colorado River Basin. Enclosed is a copy of the resolution and original Agreement for your files. If you have any questions, please do not hesitate to contact Tom Clark at 218 -6617. S cerely, Christine R. Martinez City Secretary Enclosure CITY OF ROUND ROCK 221 East Main Street • Round Rock, Texas 78664 Phone: 512218.540o • Fax: 5iz.218.7097 • www.cisound-rock.tx.us Brazos River Authority October 17, 2002 Mr. Tom Clark Director of Utilities City of Round Rock 2008 Enterprise Drive Round Rock, Texas 78664 Re: System Water Availability Agreement For Colorado River Basin Water Between Brazos River Authority and City of Round Rock Dear Mr..-C—It Enclosed please find two (2) copies of the above - referenced Agreement. Please procure the appropriate signature and retum both copies to my attention. I will return one fully executed copy after signature by General Manager /CEO Phillip Ford. If you have any questions, feel free to contact me at (254) 761 -3166. erel HN BAKER Regional Manager, Central Basin JB:j1s Enclosures r: Nmnal hos.,bakerlconNV to ro, d rock 1.4 724 02.doc 4600 Cobbs Drive • P.O. Box 7555 • Waco, Texas 76714 -7555 254 - 761 -3100 • FAX 254 - 761 -3215 QUALITY • CONSERVATION • SERVICE ROUND ROCK, TEXAS PURPOSE. PASSION. PROSPERITY MEMORANDUM TO: Steve Sheets, Christine Martinez FROM: Tom Clark SUBJECT: Agreement with Brazos River Authority DATE: October 22, 2002 Enclosed are two original agreements with the Brazos River Authority for 4,500 acre feet of water. This was approved by the City Council at a recent meeting. I have reviewed the documents and recommend they be executed by the Mayor. After his execution, please retum to me for processing or retum to: Mr. John Baker, Central Basin Regional Manager Brazos River Authority P.O. Box 7555 Waco, Texas 76714 -7555 After they are executed by the BRA General Manager and retumed, please forward a working copy to me. Sincerely, Tom Clark Director of Utilities Brazos River Authority August 8, 2002 Mr. Robert Bennett City of Round Rock 221 E. Main St. Round Rock, TX 78664 Dear Mr. Bennett: 4600 Cobbs Drive • P.O. Box 7555 • Waco, Texas 76714 -7555 254-761-3100 • FAX 254 - 761 -3215 QUALITY • CONSERVATION • SERVICE RECEIVED AUG 1 3 2002 This letter is to notify you that the Fiscal Year 2003 pricing structure for your System Water Availability Agreement for Colorado River Basin Water will remain the same as the previous year. Based on information provided by Lower Colorado River Authority the current "Agreement Reserved Water Charge" of $49.22 is not expected to change in 2003. Payment Options As with last year's payment, the Authority is offering three payment methods - annual, quarterly, or monthly. Your Agreement provides for these payment options. The following are payment factors in accordance with the Authority's policy for calculating monthly and quarterly payments made during FY 2003: Quarterly Payment Factor . 253 Monthly Payment Factor . 085 These payment factors include the recovery of interest earnings lost as the result of a customer's not making the "standard" annual payment plus a service charge for the administrative billing, accounting, and collection costs associated with multiple payments. Example For either of the altemative plans, the appropriate factor is multiplied by your "standard" annual payment amount to determine your monthly or quarterly payment. Therefore, if your Agreement were for 100 acre -feet of water per year, the three payment plans would be calculated as follows: Annual Payment - $49.22 x 100 AF = $ 4,922.00 Quarterly Payment - $4,922.00 x 253 = 1,245.27 Monthly Payment - $4,922.00 x .085 = 418.37 �1 City of Round Rock August 8, 2002 Page 2 If you wish to select a payment option other than the method you are currently using, please call Cheryl Grier, Accounts Receivable & Grant Coordinator, at (254) 761 -3117, at the Authority's Waco office by August 14, 2002. The invoices will be mailed to you on August 15, 2002. Please do not hesitate to call if you have any questions. Thank you for the opportunity to provide for your raw water needs. Sincerely, Susan L. Morgan, CPA Chief Financial Officer SLM:clg cc: Regional Manager Brazos River Authority August 6, 2002 Mr. Robert Bennett City of Round Rock 221 E. Main Round Rock, TX 78664 Dear Mr. Bennett: RECEIVED AUG 1 2 eon) QUALITY • CONSERVATION • SERVICE This letter is to notify you that the Brazos River Authority's fiscal year 2003 System Rate for water is $34.50 per acre -foot. The rate was reviewed with customers at the Customer Advisory Meeting held July 25, 2002, and adopted by the Board of Directors on July 29, 2002. This rate applies only to System Water Supply Agreement contracts and will be reflected on your invoice due September 15, 2002. Payment Options As with last year's payment, the Authority is offering three payment methods - annual, quarterly, or monthly. Your System Water Supply Agreement either provides for or can be amended to provide for these payment options. The following are payment factors in accordance with the Authority's policy for calculating monthly and quarterly payments made during FY 2003: Quarterly Payment Factor . 253 Monthly Payment Factor . 085 These payment factors include the recovery of interest earnings lost as the result of a customer's not making the "standard" annual payment plus a service charge for the administrative billing, accounting, and collection costs associated with multiple payments. Example For either of the alternative plans, the appropriate factor is multiplied by your "standard" annual payment amount to determine your monthly or quarterly payment. Therefore, if your System Agreement were for 100 acre -feet of water per year, the three payment plans would be calculated as follows: Annual Payment - $34.50 x 100 AF = $ 3,450.00 Quarterly Payment - $3,450.00 x .253 = 872.85 Monthly Payment - $3,450.00 x .085 = 293.25 4600 Cobbs Drive • P.O. Box 7555 • Waco, Texas 76714 -7555 254- 761 -3100 • FAX 254 - 761 -3215 City of Round Rock If you wish to select a payment option other than the method you are currently using, please call Cheryl Grier, Accounts Receivable & Grant Coordinator, at (254) 761 -3117, at the Authority's Waco office by August 14, 2002. The invoices will be mailed to you on August 15, 2002. Please do not hesitate to call if you have any questions. Thank you for the opportunity to provide for your raw water needs. Sincerely, U Susan L. Morgan, CPA Chief Financial Officer SLM:clg cc: Regional Manager August 6, 2002 Page 2 * * * * * * * * * * * * * ** -COMM. JOURNAL- * * * * * * * * * * * * * * * * * ** DATE RUG -12 -2002 * * * ** TIME 13:37 * ** P.01 MODE = MEMORY TRANSMISSION FILE NO.= 095 STN NO. COM ABM N0. STATION NAME /TEL.NO. PAGES DURATION 001 OK <08> PUBLIC WORKS 002/002 00:00'40" 002 OK <09> SHEETS 002/002 00:00'42" ***** * * * * * * * * * * * * * * * * * * * * * * * * * * * * * ** - 5122187097 Brazos River Authority August 6, 2002 Mr. Robert Bennett City of Round Rock 221 E. Main Round Rock, TX 78664 RECEIVED AUG 1 2 2002 START= RUG -12 1334 END= AUG-12 13:37 -CITY OF ROUND ROCK 4600 Cobbs Drive • 9.0, Box 7555 • Waco, 'Texas 76714.7555 254 - 761.3100 • FAX 254-761 -3215 - * * * ** - 5122187097- * * * * * * * ** QUALITY • CONSERVATION • SERVICE Dear Mr. Bennett: This letter is to notify you that the Brazos River Authority's fiscal year 2003 System Rate for water is $34.50 per acre -foot. The rate was reviewed with customers at the Customer Advisory Meeting held July 25, 2002, and adopted by the Board of Directors on July 29, 2002. This rate applies only to System Water Supply Agreement contracts and will be reflected on your invoice due September 15, 2002. Payment Options As with last year's payment, the Authority is offering three payment methods - annual, quarterly, or monthly. Your System Water Supply Agreement either provides for or can be amended to provide for these payment options. The following are payment factors in accordance with the Authority's policy for calculating monthly and quarterly payments made during FY 2003: Quarterly Payment Factor . 253 Monthly Payment Factor . 085 These payment factors include the recovery of interest earnings lost as the result of a customer's not making the "standard" annual payment plus a service charge for the administrative billing, accounting, and collection costs associated with multiple payments. Example For either of the alternative plans, the appropriate factor is multiplied by your "standard" armual payment amount to determine your monthly or quarterly payment. Therefore, if your System Agreement were for 100 acre-feet of water per year, the three payment plans would be calculated as follows: Annual Payment - $34.50 x 100 AF = $ 3,450.00 Quarterly Payment - $3,450.00 x .253 m 872.85 Monthly Payment - $3,450.00 x .085 = 293.25 Brazos River Authority July 25, 2002 Mr. Nyle Maxwell, Mayor City of Round Rock 221 East Main Round Rock, Texas 78664 Dear Mayor Maxwell: incerely, J HN BAKER R gional Manager, Central Basin JB:jls Enclosures r:Icenval 6arinlM.trrlromVn to round rock ».rc 714 01doc RECEIVED JUL 2 9 2002 Re: System Water Availability Agreement For Colorado River Basin Water Between Brazos River Authority and City of Round Rock If you have any questions, feel free to contact me at (254) 761 -3166. 4600 Cobbs Drive • P.O. Box 7555 • Waco, Texas 76714 -7555 254- 761 -3100 • FAX 254 - 761 -3215 QUALITY • CONSERVATION • SERVICE Per an Email request from Jim Nuse on April 1, 2002, the Authority has prepared a contract to provide the City of Round Rock with an additional 4,500 acre -feet of surface water. The water reserved in this contract is a portion of the 25,000 acre -feet acquired from the Lower Colorado River Authority by the Brazos River Authority. The Authority values the City of Round Rock as a water customer and looks forward to meeting your future water demands. Enclosed please find two (2) copies of the above - referenced Agreement. Please sign and retum both copies. I will return one fully executed copy after signature by General Manager /CEO Phillip Ford. SEP -96 -2002 15:50 FROM: SYSTEM WATER AVAILABILITY AGREEMENT FOR COLORADO RIVER BASIN WATER BETWEEN BRAZOS RIVER AUTHORITY AND CITY OF ROUND ROCK 1U:512E185556J 1'.003 AGREEMENT made and entered into this the ol(al day of 2002, by and between BRAZOS RIVER AUTHORITY (`Authority "), a iver authority of the State of Texas, and CITY OF ROUND ROCK ( "Purchaser") of Williamson County, Texas. %'& /141 3-A 1. RECITALS. Authority owns and operates various lakes in the Brazos River Basin. Authority also has entered into contracts with the United States of America by virtue of which it has obtained the right to utilize for water supply purposes a portion of the usable storage space in various lakes owned and operated by the United States Army Corps of Engineers. Authority is authorized by the State of Texas to store State waters in the lakes owned by Authority and various lakes owned and operated by the United States Army Corps of Engineers in the Brazos River Basin, hereinafter collectively called the "System ", and to make such stored waters available for beneficial use. Authority is authorized to operate the System as a hydrologic unit pursuant to an order of the Texas Water Commission (now Texas Natural Resource Conservation Commission "TNRCC ") issued on July 23, 1964 ( "System Operation Order"). The Final Determination of All Claims of Water Rights in the Brazos River Basin and the San Jacinto- Brazos Coastal Basin Maintained by the Brazos River Authority. Fort Bernd County W.C.I.D. No. 1 and Galveston County Water Authority ("Final Determination") issued on June 26, 1985, by TNRCC clarified and amplified the System Operation Order. Under the System Operation Order as adjudicated by the Final Determination, Authority Is authorized to operate the System as a hydrologic unit to more efficiently utilize the reservoirs that make up the System to make water available to meet the needs of Authority's customers. Authority and Purchaser have entered into certain raw water contracts (System Water Availability Agreement Between Brazos River Authority And City of Round Rock - Lake Georgetown And System Water Availability Agreement Between Brazos River Authority And City of Round Rock - Lake Stillhouse Hollow). Authority has also acquired the right to divert and use 25,000 acre -feet of water per year from the Colorado River Basin made available from the Lower Colorado River Authority (LCRA) under the "Water Sate Contract by and between Lower Colorado River Authority and Brazos River Authority Purchaser ", dated October 2000 (LCRA Contract) pursuant to the terms of House Bill 1437 of the 76'" Texas Legislative Session and codified under Section 27 of the LCRA Enabling Act. It is from the 25,000 acre -foot of e- U-0q -2( -10D9 09/06/2002 FRI 15:50 [TX /RX NO 9570] 003 SEP -06 -2002 15:50 FROM: TO:5122105563 P.004 water per year from the Colorado River Basin (the "LCRA Water ") that Purchaser now wishes to contract for Authority to make available 4,500 acre-feet of water per Calendar Year under the terms and conditions herein provided. 2. DEFINITIONS. a) The Term "Agreement" means this agreement. b) The Term "Agreement Rates" means the "Agreement Water Rate ", the °Agreement Reserved Water Charge ", and the "Agreement Inverted Block Rate" for water purchased pursuant to this Agreement as more fully described in Section 5, PRICING STRUCTURE, and in Section 7, UNCONDITIONAL NATURE OF PAYMENT OBLIGATION; PRICE, below. c) The term "Area of Use" means that certain area in Williamson County that Iles outside of the watershed of the Colorado River, but excludes those municipalities which were customers of the Lower Colorado River Authority as of May 20, 1997, and who are located in watersheds of both the Colorado and Brazos Rivers. d) The term "Authority" shall mean Brazos River Authority. e) The term "Board" shall mean the Board of Directors of Brazos River Authority. f) The term "Credit for System Rate Recovery" of "(RR" means the credit described in Section 7. (c) of this Agreement. g) The term "Cost Recovery Fee" or "CRF" means the fee described in Section 7. (b) (3) of this Agreement h) The Term "Federal Contracts" shall mean those contracts with the United Sates of America whereby Authority has acquired, is acquiring, or may acquire conservation storage capacity in Federal Reservoirs. i) The term "Federal Reservoirs" shall Include the following: Aquiila Dam and Reservoir Belton Dam and Reservoir Georgetown Dam and Reservoir Granger Dam and Reservoir Proctor Dam and Reservoir Somerville Dam and Reservoir Stillhouse Hollow Dam and Reservoir Whitney Dam and Reservoir j) The term "Fiscal Year" shall mean Authority's fiscal year from September 1 through August 31, or such other annual fiscal year period as Authority may later determine. k) The term "Highest Lawful Rate" shall mean the maximum rate which Authority may charge on obligations payable under this Agreement without violation of any applicable law or any applicable lawful regulation of any agency of the State of Texas or of the United States having jurisdrd5on of the matter. I) The term "Industrial Use" shall mean the use of water in processes designed to convert materials of a lower order of value into forms having greater usability and commercial value, including commercial feddlot operations, commercial fish production, and the development of power by means other than hydroelectric. m) The term "Irrigation Use shall mean the use of water for the irrigation of crops, trees, and pastureland, including, but not limited to, golf courses and parks which do not receive water through a municipal distribution system. 09/06/2002 FRI 15:50 [T% /RX NO 9570] x]004 SEP -.06 -2002 15:51 FROM: TO:5122185563 P.005 n) The term "LCRA" means Lower Colorado River Authority. o) The term "LCRA Contract' means the "Water Sale Contract by and between Lower Colorado River Authority and Brazos River Authority, Purchaser" dated October 2000. p) The term "LCRA Rates" means the LCRA rates and charges for sale of water for municipal purposes as delineated in Section II. B. of the LCRA Contract. q) The term "LCRA Water" means the 25,000 acre-feet of water per year purchased by Brazos River Authority from LCRA pursuant to House Bill 1437 of the 76 Texas Legislative Session. r) The term "Mining Use" shall mean the use of water for mining processes including hydraulic use, drilling, washing sand and gravel, and oil field repressuring. s) The term "Municipal Use shall mean the use of potable water within a community or municipality and its environs for domestic, recreational, commercial, or Industrial purposes or for the watering of golf courses, parks and parkways. t) The term "Purchaser° shall mean City of Round Rock. u) The term "System" shall mean Authority's Water Supply System and shall include certain of Authority's facilities and properties insofar as they are related to making water available from the System, to wit, as follows: Morris Sheppard Dam and Possum Kingdom Reservoir, DeCordova Bend Dam and Lake Granbury, Sterling C Robertson Darn and Lake Limestone, Authority's conservation storage in the Federal Reservoirs, and LCRA Water' obtained pursuant to the LCRA Contract, together with all future extensions, improvements, enlargements, and additions to and replacements of the System, and all replacements thereof whether from surface water supplies, groundwater, or a combination thereof, specifically added to the System by resolution of the Board; provided that, notwithstanding the foregoing, the term System shall not include (1) any of Authority's facilities and properties not specifically included in the System by the terms of this Agreement or not added by the subsequent resolution of the board, and (il) any water supply, wastewater or other facilities which have been or are declared not to be a part of the system and which may be acquired or constructed by Authority with the proceeds from the issuance of "Special Fadlitles Bonds," which are hereby defined as being special revenue obligations of Authority which are not secured by or payable from the revenues of the System but which are secured by and payable solely from spedal contract revenues or payments received from any persons or other legal entity or entities in connection with such special facilities. v) The term "System Agreements" means those certain raw water contracts titled "System Water Availability Agreement Between Brazos River Authority and City of Round Rock - Lake Georgetown" and "System Water Availability Agreement Between Brazos River Authority and City of Round Rock - Lake Stillhouse Hollow", dated contemporaneously with this Agreement herewith. • w) The term "System Operation Order" shall mean that certain order of TNRCC or its predecessor dated July 23, 1964, as adjudicated by order of the TNRCC or Us predecessor on June 26, 1965, in the Final Determination of all Claims of Water Rights in the Brazos River Basin and the San Jacinto- Brazos Coastal Basin Maintained by the Brazos River Authority. Fort Bend County W.C.Z.D. No, 1 and Galveston County Water Authority, 09/06/2002 FRI 15:50 [TI /RI NO 9570] IJ005 SEP706 -2002 15:51 FROM: TO:5122185563 P.006 x) The term "System Rate" or "SR" shall mean the rate per acre -foot of water established by Authority from time to time under its systemwide pricing methodology. y) The term "Total Annual Budgeted System Costs" shall mean the amounts approved by Authority as estimated costs of the System in the annual budgets adopted by Authority for a given Fiscal Year including, without limitation, amounts budgeted to meet Annual System Operation and Maintenance Expenses and Annual Capital Related Costs. z) The term "Total System Billing Units" shall mean the total amount of water (expressed in acre-feet) determined by Authority under accepted engineering practice as necessary to be reserved from firm yield produced by storage in the System to fulfill its commitments for which Authority receives payment under long term (in excess of five years) water sales contracts with Purchaser and Authority's other customers; provided, however, such term shall not include amounts of water required by appropriate governmental authority to be reserved in the System for us for bay and estuary purposes, In- stream uses, or for other similar environmental, public, or other beneficial uses to the extent Authority is not adequately compensated for any such requirement. 3. EFFECTIVE DATE. The effective date of this Agreement is September 1, 2002. 4. AVAILABILITY OF WATER. While this Agreement remains in force, Authority agrees to make available to Purchaser an amount of water not to exceed 4,500 acre -feet of water per Calendar Year under the following conditions: a) Notwithstanding anything herein to the contrary, Authority's obligation to make water available to Purchaser under this Agreement is subject to, and limited by, the rights of Authority to obtain the LCRA Water pursuant to the LCRA Contract. Purchaser acknowledges that Purchaser has received a copy of the LCRA Contract and is familiar with the rights of Authority thereunder, and the limitations on Authority's rights thereunder to obtain the LCRA Water. b) Authority may interrupt or curtail the water supplied to Purchaser under this Agreement to the extent Authority experiences Interruption or curtailment of water supplied to it under the LCRA Contract for any reason. c) Water supplied under this Agreement shall only be used within the Area of Use. d) Purchaser acquires no property rights in the water made available to it under this Agreement beyond the right to have the water made available to it for diversion and use under the terms of this Agreement. This right of use extends to direct reuse (flange to flange) of the water made available under this Agreement. Purchaser represents, and Authority relies on such representation, that all water to be made available by Authority under this Agreement to. Purchaser shall be used solely for municipal purposes. 09/06/2002 FRI 15:50 (TX/RX NO 95701 a006 SEP -26 -2002 15:52 FROM: TO:5122185563 P.007/016 5. PRICING STRUCTURE a) The pricing structure for water rates under this Agreement is dependent upon the pricing structure of water made available to the Authority under the LCRA Contract unless or until the Authority's System Rate exceeds the price derived from the formula provided for price calculation in Section 7, below. At such time, the price under this Agreement shall be the Author System Rate. b) The LCRA Water is provided to Authority under the LCRA Contract pursuant to the following pricing structure: (1) The "Water Rate" for LCRA Water is charged for water diverted and used during a calendar year. The current Water Rate is $105.00 per acre -foot of water per year. (2) The °Reserved Water Charge" for LCRA Water is charged for water under contract but not diverted and used during a calendar year. The Reserved Water Charge is 50% of the Water Rate, or currently $52.50 per acre -foot of water per year. (3) The "Inverted Block Rate" for LCRA Water is charged for all water used in excess of the total contractual amount and is currently $200.00 per acre -foot of water per year. (4) The "Conservation Charge" for LCRA Water is currently 25% of the Water Rate, the Reserved Water Charge, or the Inverted Block Rate, as applicable. (5) The current "Total LCRA Rates" for LCRA Water are as follows: (a) The "Total LCRA Water Rate" Is the Water Rate + the Conservation Charge, currently $131.25 an acre-foot. (b) The "Total LCRA Reserved Water Charge" Is the Reserved Water Charge + the Conservation Charge, currently $65.63 an acre -foot. (c) The "Total LCRA Inverted Block Rate" is the Inverted Block Rate + the Conservation Charge, currently $250.00 an acre-foot. (d) The Authority makes water available to Purchaser under this Agreement pursuant to the following pricing structure: (1) The "Agreement Reserved Water Charge" for all water agreed to be made available under this Agreement whether or not it is diverted an used during a calendar year. The current Agreement Reserved Water Charge is $49.22 per acre -foot of water per year, the calculation for which is set out in Section 7.c., below. (2) The "Agreement Water Rate" for only water that is diverted and used during a calendar year. The Agreement Water Rate equals the Agreement Reserved Water Charge and Is in addition Iv the Agreement Reserved Water Charge. (3) The "Agreement Inverted Blvd( Rate" for water used in excess of the amount agreed to be made available under this Agreement. The Agreement Inverted Block Rate Equals the Total LCRA Inverted Block Rate. 6. DATE AND PLACE OF PAYMENTS a) Payments to be made hereunder shall be made at Authority's office in Waco, McLennan County, Texas. Authority contemplates that by September 1 of each Fiscal Year it will have adopted budgets for Authority for said Fiscal Year and established the System Rate and the Agreement Rates for said Fiscal Year. Payments for each Fiscal Year may be made under one of three payment options from which 09/06/2002 FRI 15:50 [TX/RI NO 9570] 12007 5EP -06 -2002 15:52 FROM: TO:5122185563 P.006 } Purchaser will select at the beginning of each Fiscal Year. The payment due at the beginning of each Fiscal Year will be for the water agreed to be provided during the next calendar year, and shall be based on the Agreement Reserved Water Charge. Annual payments for water provided at the Agreement Reserved Water Charge shall be made on or before September 15 each Fiscal Year. Quarterly payments shall be made on or before September 15, December 15, March 15, and June 15 each Fiscal Year. Monthly payments shall be made on or before the fifteenth of each month each Fiscal Year Quarterly payments or monthly payments shall Include a multiplier to be applied to the annual payment to allow Authority to recover interest lost on any unpaid balance plus a service charge for administrative costs, including but not limited to costs Involving the billing, accounting, and collecting for the quarterly or monthly payments. The multiplier to recover lost interest revenue and the service charge for administrative costs shall be determined on an annual basis and shall be just and reasonable. If the effective date of this Agreement is other Than January 1, the amount of water available ID Purchaser and the payment owed by Purchaser will be prorated for the remaining monthly of the Calendar Year, 2002. b) The charge for any water actually diverted and used during the next calendar year will be billed to Purchaser on a monthly basis based on the actual diversion and usage for the previous month at the Agreement Water Rate. c) Purchaser may elect to defer payment of its obfigattons for water purchased pursuant to Agreement Reserved Water Charges by providing Authority notice of such election in writing within 60 days from the date of execution of this Agreement. In no instance shall the deferral terms extend beyond the initial ten years of this Agreement. If Purchaser selects deferred payment, the following structure will be used: (1) Years 1 -2: Purchaser will receive a credit of 50% of the Agreement Reserved Water Charge. (2) Years 3-4: Purchaser will receive a credit of 25% of the Agreement Reserved Water Charge. (3) Years 5 -6: Purchaser will receive no deferral of the Agreement Reserved Water Charge. (4) Year 7: Purchaser will pay 125% of the Agreement Reserved Water Charge. (5) Year 8-9: Purchaser will pay 150% of the Agreement Reserved Water Charge. (6) Year 10: Purchaser will pay the remaining outstanding deferred balance plus 100% of the current year's Agreement Reserved Water Charge. Notwithstanding anything herein to the contrary, in the event the differed payments calculation yields a rate that is less than the then current Authority System Rate, the full System Rate will be the rate charged for the Fiscal Year's payment Unpaid balances will accumulate interest based on actual Authority Interest rates earned on the Authority's Investments. The Authority's interest rate will be the Authority's average annual portfolio yield plus 0.5 percent per annum for administrative costs. Interest charges will be assessed on an annual basis using simple interest, compounded annually. 09/06/2002 FRI 15:50 IT% /RX NO 95701 2h008 SEP -136 -2002 15:53 FROM: T0:5122185563 P.009 -016 T. UNCONDITIONAL NATURE OF PAYMENT OBLIGATION: PRICE. a) Purchaser unconditionally agree to pay Authority in accordance with the terms of this Agreement for the water agreed to be made available to Purchaser from the LCRA Water pursuant to this Agreement. b) The Agreement Rates are derived using the following components: (1) The Authority's System Rate (currently $29.90 per acre -foot of water per year). (2) The Total LCRA Water Rate, Total LCRA Reserved Water Charge, or Total LCRA Inverted Block Rate (as defined in Section 5.).(5), above). (3) The "Cost Recovery Fee" (the applicable Total LCRA Rate minus the Authority's System Rate minus the Credit for System Rate Recovery). c) The "Credit for System Rate Recovery" (a 25% discount from the Total LCRA Water Rate or the Total LCRA Reserved Water Rate, but not from the Total LCRA Inverted Block Rate). The Agreement Reserved Water Charge (ARWC) Es the System Rate plus the Cost Recovery Fee. Using current components, the Agreement Reserved Water Charge is derived as follows: ARWC= SR + CRF ARWC= $26.00 + (Total LCRA Reserved Water Charge - SR -CSRR) ARWC= $26.00 + ($65.63 - $26.00 - $16.41) ARWC= $26.00 + $23.22 ARWC= $49.22 d) The Agreement Water Rate Is equal to the Agreement Reserved Water Charge, currently $49.22, and is in addition to the Agreement Reserved Water Charge. e) The Agreement Inverted Block Rate is equal to the Total LCRA Inverted Block Rate, currently $250.00. t) Authority may, and it specifically reserves the right to, revise the Agreement Rates from time to time (usually prior to the start of each Fiscal Year) to reflect changes in the System Rate and the LCRA Rates. Authority shall not increase the Agreement Rates other than on a Fiscal Year basis except for unforeseeable reasons of a serious and substantial nature. Such reasons include Force Majeure, government legislation or regulation, perrnit requirements, or changes in the LCRA Rates. g) Notwithstanding anything herein to the contrary, In the event the Agreement Rates calculation yields a rate that is less than the then current Authority System Rate, the System Rate will be the Agreement Rates. 8. SOURCE OF PAYMENTS. The payments t r be made hereunder by Purchaser shall constitute operating expenses of Purchaser's water works system or Purchaser's combined water works and sewer system. Purchaser shall charge rates for services of its water works system or its combined water works and sewer systems that will be suffident to pay the operating and maintenance expenses thereof, Including the payments provided for hereunder, and the interest on and principal of as the same come clue and mature, obligations issued by Purchaser now or hereafter payable from the revenues of said system or systems. 09/06/2002 FRI 15:50 ITX /RX NO 9570] 1J009 SEP -06 -.2002 15:51 FROM: • TO:5122185563 P.010'016 9. INTEREST ON PAST DUE PAYMENT: COLLECTION. In the event of failure of Purchaser to make any payment to authority provided to be made in this Agreement at the time when same shall be due, the past due payment shall bear Interest at the lesser of the highest rate allowed by applicable law or 18 percent per year. Regardless of any other provision contained in this Agreement, Authority shall never be entitled to receive, collect or apply as interest under this Agreement any amount of money determined at a rate which exceeds the Highest Lawful Rate. If Authority ever charges, receives, collects, or applies as interest an amount in excess of that permitted by application of the Highest Lawful Rate, then any such amount which would be excessive Interest shall be deemed a partial prepayment of amounts payable under this Agreement which do no constitute interest and shall be treated hereunder as such; and if all other obligations payable under this Agreement shall have been paid in full, then Authority shall refund the amount of such excessive Interest 10. REMEDIES FOR NONPAYMENT OR DEFAULT. Should Purchaser fail to make any payment to Authority when due hereunder or otherwise be In default under this Agreement, Authority at its sole option and In addition to and without impairing any other remedy available to it on account of the default, may elect to either (1) suspend Its duty to make available water to Purchaser under this Agreement or (11) terminate this Agreement, by providing written notice of such suspension or termination delivered to Purchaser on or before 30 days before the date spedfied in said notice of suspension or termination, provided that the nonpayment or other default with respect to which notice of suspension or termination of this Agreement has been given, shall not be cured by the date spedfled In such notice. Nothing In this Agreement shall be construed in any manner so as to abridge, limit or deprive either party hereunto or any means which it would otherwise have of enforcing any right or remedy either In law or in equity for breach of any of the provisions hereof. 11. REMEDIES OF OVERUSE. Purchaser recognizes that any diversion of water in excess of its contractual amount may impact Authority's ability to make available water to Authority's other raw water customers. Purchaser agrees that If for any reason It needs to exceed the contractual annual amount of water to be made available to it under this Agreement, Purchaser will give written notce to Authority 30 days in advance of the need for such additional water and in such notice will state the reason for the additional need, the amount of water needed to be made available, and the duration of the need. Authority, In its sole discretion, may make all or a portion of the requested water available. Should Authority determine that It can make all or a portion of the requested water available without adversely Impacting its ability to make water available to its other customers, Purchaser agrees to pay for such water to be made available in advance at a rate that is equal to the then current Agreement Inverted Block Rate. Should Purchaser fail to notify Authority of its need for additional water to be made available, and exceed the contractual annual amount of water to be made available to it, or should Purchaser, after notification of Authority and Authority's 09/06/2002 FRI 15:50 IT% /RA NO 95701 Q010 SEP -06 -2002 15:54 FROM: TO:5122185563 P.O11 } determination that additional water is not available for Purchaser's use, nonetheless exceed the contractual amount of water to be made available to i1, Authority may cancel this Agreement by providing written notice of such cancellation delivered to Purchaser on or before thirty (30) days before the date specified in said notice of cancellation. Nothing in this Agreement shall be construed in any manner so as to abridge, limit, or deprive either party hereunto of any means which it would otherwise have of enforcing any right or remedy either in law or in equity for breach of any of the provisions hereof. 12. FACILITIES. Ali new facilities that are located in the Area of Use that are used to transport raw water that is purchased pursuant to this Agreement exclusively may be owned and operated by LCRA, at its sole option. All new fadlitles or all substantial expansions to facilities that are located In the Area of Use that treat water or transport treated water that is purchased pursuant to this Agreement and that are constructed by BRA or LCRA shall be Brazos - Colorado Alliance projects. The LCRA may own, at its sole option, a portion of any such facilities that is commensurate with the percentage that LCRA water (Le., water supplied under the LCRA Contract) bears to the total amount of water supplied by BRA and LCRA for treatment or transportation by such facilities. Ftlr example, If twenty-five percent (25 %) of the water used at an Alliance facility Is supplied by LCRA under the LCRA Contract, the LCRA may own twenty-five percent (25%) of that facility. All such facilities in the Area of Use, however, shall be operated by BRA. All new facilities and all substantial expansions to fadlftles that are located in the Area of Use that treat or transport treated water purchased pursuant to this Agreement that are constructed by Purchaser may be owned and /or operated by Purchaser if such ownership and/or operation is desired by Purchaser. Purchaser acknowledges that the economics of scale and effidendes of use made possible by regionalization of water treatment facilities are highly desirable. Purchaser, therefore, agrees to negotiate In good faith with BRA and LCRA to maximize the potential for regionalization of water treatment and transportation fadlitles, either new fadlities or substantial expansion of facili ties, located In the Area of Use used to treat or transport water that is purchased pursuant to this Agreement. 13. METERING. Purchaser agrees that, at its sole cost and expense, It shall Install, operate and maintain meters for the accurate measuring of all water diverted by Purchaser under this Agreement in order to aid Authority In accurately reporting actual water usage to the TNRCC as required by applicable law or regulation. Such meter or meters shall be tested and calibrated for accuracy by and at the expense of Purchaser once each fiscal year at intervals of approximately 12 months, and a report of such test and calibration shall be furnished to Authority. Authority shall be given at least two prior days notice of the time of any test and calibration of Purchaser's meters, or any of them, and Authority shall have the right to have a representative present at each test to observe the test and any adjustments found thereby to be necessary Authority shall have the right to inspect and check the accuracy of Purchaser's meter or meters at any 09/06/2002 FRI 15:50 ITX /RX NO 95701 g 011 SEP- 067E002 15:55 FROM: TO:5122185563 P.012 or time during usual business hours after not less than one nor more than five (5) days notice. In the event any question arises at any time as to the accuracy of any such meter, such meter shall be tested promptly upon demand of Authority, the expense of such test to be borne by Authority if the meter is found to be correct and by Purchaser if it is found to be incorrect. Readings within 2% of accuracy, plus or minus, shall be considered correct. If, as a result of any test, any meter if found to be registering inaccurately (i.e., in excess of 2% of accuracy, plus or minus), the readings of such meter shall be corrected at the rate of its inaccuracy for any period which is definitely known and agreed upon, but in case the period is not definitely known and agreed upon, then the shorter of the following periods shall be used as the basis for erection: a) a period extending back either 60 days ftom the date of demand for the test or, if no demand for the test was made, 60 days from the date of the test, b) a period extending back half of the time elapsed since the last previous test, and the records of readings shall be adjusted accordingly. Following each test of a meter, Purchaser shall cause the same to be calibrated to register accurately. 14. REPORTING. Purchaser agrees that it will keep accurate records of the daily readings from the meter or meters Installed pursuant to Section 13., Metering, above. These records shall be subject to Inspection by Authority at reasonable times and places. Purchaser shall submit reports to Authority by the 10 day of each month showing the amount of water diverted under this Agreement each day during the preceding month. 15. SYSTEM AGREEMENT. This Agreement does not affect the rights and obligations of Authority and Purchaser under the System Agreements. 16. CONSERVATION OF WATER. It is the intent of the parties to this Agreement to provide to the maximum extent practicable for the conservation of water, and Purchaser agrees that rt is a condition of this Agreement that It shall maintain and operate its facilities in a manner that will prevent unnecessary waste of water. Authority, In accordance with applicable law or regulation, may from time to time adopt reasonable ruies and regulations relating to water conservation. Purchaser agrees to abide by the "Brazos River Authority Drought Contingency Policy' adopted by the Board on January 16, 1989, or any subsequent Drought Contingency Policy duly adopted by the Board and any Drought Contingency Plans developed under the Drought Contingency Policy. If required by applicable law or regulation or by Authority, Purchaser agrees to implement a water conservation and drought management program in accordance with a water conservation plan and that the water made available and diverted by Purchaser pursuant to this Agreement Will be used In accordance with such conservation plan, and with the regulations of the Texas Natural Resource Conservation Commission (or other appropriate regulating authority) applicable to retail public utilities. Purchaser further agrees to make available its water conservation and drought contingency programs to Authority and LCRA for review. If required by applicable law or 09/06/2002 FRI 15:50 [TX /RX NO 9570] Q012 SEP706 7002 15:55 FROM: TO :5122185563 P.013 regulation Purchaser agrees that, in the event Purchaser furnished water or water services to a third party that in tum will furnish the water or services to the ultimate consumer, the requirements relative to water conservation shall be met through contractual agreements between Purchaser and the third party providing for the established and implementation of a water conservation program in compliance with such applicable law or regulation. If Purchaser fails to comply with its water conservation plan, Authority may, at its sole option terminate this Agreement without recourse unless such default is cured within thirty (30) or, if the nature of such default is not susceptible to being cured within such thirty (30) day period, such longer period of time during which Purchaser diligently prosecutes the cure of such default, not to exceed ninety (90) days of Purchaser's receipt of written notice of such default. 17. WATER QUALITY. As a further condition of this Agreement, Purchaser also agrees that It will comply with applicable water quality standards of the State in the diversion, use, reuse, or discharge of water made available hereunder. Should Purchaser be determined by any competent legal authority to have degraded the quality of water of the State or to have violated any water quality standard established by law or lawfully adopted regulation, and subsequently fail to take action With reasonable diligence to correct such defidency as directed by competent legal authority, such failure shall constitute an event of default under this Agreement. Authority, in accordance with applicable law or regulation may from time to time adopt reasonable rules and regulations relating to water quality protection. If required by applicable law or regulation or by Authority, Purchaser agrees to implement appropriate water quality protection measures including, without limitation, a non -point source water pollution abatement program in accordance with a non -point source water pollution abatement plan. 18. WATER SURPLUS TO PURCHASER'S NEEDS. Purchaser may not unilaterally cancel this Agreement or reduce the amounts of water agreed to be made available to It and for which availability it is obligated to pay under the terms of Sections 4. And 7., above, except as provided in Section 26, below. Purchaser may not sell or make available to others the water agreed to be made available to it under this Agreement, except in the case of municipal uses, as potable treated water. However, should Purchaser determine that it has water surplus to its anticipated needs from the water to be made available by Authority under this Agreement, Purchaser may notify Authority as to the amount of water no longer needed to be made available to it Authority will use reasonable efforts to find a third party who Is able and willing to pay for such availability for a period to the end of this Agreement. If Authority is successful in finding such a third party suitable to it to acquire Purchaser's interest In its available surplus for a period of time to the end of this Agreement, this Agreement will be amended to reduce the amount of water to be made available to Purchaser by the amount of availability paid for by such third party, and Purchaser will be relieved of the obligation to make payments for such availability of water. 09/06/2002 FRI 15:50 [T% /Rd NO 9570] 0013 SEP -06 -2802 15:56 FROM: T0:5122185563 P.014 1 19. SHORTAGES. Authority makes no guarantee that any lakes or other sources of supply in the Colorado River Basin will be maintained at any specific level at any particular time. Purchaser bears all transportation losses prior to final diversion. It is fully understood by the parties hereto that the level of lakes or other sources of supply in the Colorado River Basin will vary as a result of weather conditions beyond the control of Authority, and that this instrument is merely an agreement to require Authority to make available water when and if water is available to Authority under this Authority's LCRA Contract and to allow Purchaser to make withdrawals of the water subject to the general law on distribution and allocation of water during shortages of supply. Authority covenants that it will use its best reasonable eflbrts to maintain and preserve its rights under the LCRA Contract. If for any reason the availability of water to Authority under the LCRA Contract is restricted, impaired, or otherwise limited, Authority agrees, and Purchaser covenants, that Authority may fairly and equitably apportion and ration the available water supply from the LCRA Contract among all its several customers receiving water from Authority as a result of the LCRA Contract, including Purchaser. 20. FORCE MAJEURE Notwithstanding anything herein to the contrary, neither party hereto shall be under any liability or be deemed in default with respect to its obligations under this Agreement for any failure to perform or for delay In performing such party's obligations hereunder (except for the obligation to pay money) where such failure or delay is due to force majeure, while and to the extent that such performance Is prevented by such cause. The term force majeure means acts of God, fire, storm, flood, war, riots, sabotage, drought, lack of availability of wager due to sedimentation, low inflows of water to, or lack of water supply in the System or from the Colorado River basin to be made available under the LCRA Contract, strikes or other differences with labor (whether or not within the power of the parties to settle same), decrees or orders of the courts or other governmental authority, or other similar or dissimilar causes not within the reasonable control of such party and not due to negligence of such party. Each party shall use due diligence to resume performance of any obligation suspended by force majeure at the earliest practicable time. 21. WAIVER. Any waiver at any time by any party of its rights with respect to default under this Agreement shall not be deemed a waiver of such rights with respect to any subsequent default or matter. 22. NOTICES AND CERTIFICATIONS. Notices and certifications provided for in this Agreement shall be in writing. The same shall be delivered by mailing certified mail, postage paid, return receipt requested, to the respective parties at the following addresses: 09/06/2002 FRI 15:50 1TX /RX NO 95701 Eh014 SEP -8 -2002 15:57 FROM: Authority: Brazos River Authority 4600 Cobbs Drive P.O. Box 7555 Waco, Texas 76714 -7555 Telephone: (254) 761 -3100 Fax: (254) 761 -3207 Purchaser. City of Round Rock 221 East Main Street Round Rods, Texas 78664 Telephone: (5t2) 218 -5400 Fax: (512) 218 -7097 T0:5122185563 P.015 Either party may change Its address as shown above by written notice to the other party. Notices shall be deemed to have been delivered on the business day following their deposit in the United States mail, postage paid, and properly addressed and certified. 23. OTHER REQUIREMENT. This Agreement is subject to all conditions, provisions, and limitations included in Authority's water rights from the TNRCC and the System Order and the LCRA Contract. Further, this Agreement Is subject to all applicable Federal, State and local laws, and any applicable ordinances, rules, orders and regulations of any local, State or Federal governmental authority having jurisdiction. However, nothing contained in this Agreement shall be construed as a waiver of any right to question or contest any law, ordinance, order, rule, or regulation of any governmental authority. 24. SEVERABILITY. The provisions of this Agreement are severable, and if for any reason any one or more of the provisions contained In this Agreement shall be held to be invalid, illegal, or unenforceable In any respect, the invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement and this Agreement shall remain in effect and be construed as if the invalid, illegal, or unenforceable provision had never been contained In the Agreement. 25. ASSIGNMENT. This Agreement may be assigned by Purchaser only with the written consent of Authority, which consent shall not be unreasonably withheld or delayed. Only assignment of this entire Agreement will be approved. Releases of lesser obligations must be authorized under Section 18., Water Surplus to Purchaser's Needs, above. 26. TERMS OF AGREEMENT. The term of this Agreement shall begin on the Effective Date, Section 3., and shall end on the fifty (50) year anniversary of the Effective Date. If Authority is able to extend or renew its LCRA Contract, Authority and Purchaser agree to negotiate in good faith regarding teams for extension or renewal of this Agreement. 09/06/2002 FRI 15:50 [TX /RI NO 95701 0015 If Purchaser is current on all payments due Authority under this Agreement, Purchaser may terminate this contract, in whole or in part, on February 15 of any year following the expiration of ten (10) years measured from the Effective Date by providing six (6) months prior written notice to Authority, that is by August 15 of the year preceding the February 15 termination date. This Agreement shall be null and void in the event that the interbasin transfer permit referenced in Section 3, above, is not issued by the TNRCC with the two (2) years of the date of filling of the application for said interbasin transfer permit. CITY OF ROUND ROCK BRAZOS RIVER AUTHORITY By: By: G1 EU. Phillip 3. Ford Title: Iq' /O' _ General Manager /CEO ATTEST: ATTEST: Assistant Secretary SEP- 06-2002 15:57 FROM: If Purchaser is current on MI payments due Authority under this Agreement, Purchaser may terminate this contract, in whole or in part, on February 15 of any year following the expiration of ten (10) years measured from the Effective Date by providing six (6) months prior written notice to Authority, that is by August 15 of the year preceding the February 15 termination date. This Agreement shall be null and void in the event that the interbasin transfer permit referenced in Section 3, above, Is not issued by the TNRCC with the two (2) years of the data of filling of the application for said interbasin transfer permti. CITY OF ROUND ROCK BRAZOS RIVER AUTHORITY Phillip J. Ford General Manager /CEO Title: e: "L c /Y14 1.4 LL ATTEST: ATTEST: TO:5122185563 P.016 09/06/2002 FRI 15:50 ETX /RX NO 95701 Q016 RESOLUTION NO. R- 02- 09 -26- 11D9 WHEREAS, the City of Round Rock desires to enter into an agreement with Brazos River Authority ( "BRA ") to purchase water from the Colorado River Basin, and WHEREAS the City of Round Rock and Brazos River Authority have heretofore entered into certain raw water contracts, and WHEREAS,BRA has acquired the right to divert and use 25,000 acre - feet of water per year from the Colorado River Basin made available from the Lower Colorado River Authority (LCRA) under the "Water Sale Contract by and between Lower Colorado River Authority and Brazos River Authority Purchaser ", and WHEREAS, the City Council wishes to enter into a System Water Availability Agreement for Colorado River Basin Water between Brazos River Authority and City of Round Rock for the purchase of an additional 4,500 acre -feet of water per fiscal year from the Colorado River Basin, Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Mayor is hereby authorized and directed to execute on behalf of the City a System Water Availability Agreement for Colorado River Basin Water between Brazos River Authority and City of Round Rock for the purchase of an additional 4,500 acre -feet of water per fiscal year from the Colorado River Basin, a copy of said contract being attached hereto as Exhibit "A" and incorporated herein for all purposes. 0 : \wdox \RESOLUTI \R20926O9.WPD /rmc The City Council hereby finds and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code, as amended RESOLVED this 26th day of September, 2002. ATTEST: CHRISTINE R. MARTINEZ, City Secretary 2 WELL, Mayor y of Round Rock, Texas SEP -06 -2002 15:58 FROM: SYSTEM WATER AVAILABILITY AGREEMENT FOR COLORADO RIVER BASIN WATER BETWEEN BRAZOS RIVER AUTHORITY AND CITY OF ROUND ROCK T0;512215563 P.003 AGREEMENT made and entered into this the day of 2002, by and between BRAZOS RIVER AUTHORITY ( "Authority "), a river authority of the State of Texas, and CITY OE ROUND ROCK ( "Purchaser ") of Williamson County, Texas. 1. RECITALS. Authority owns and operates various lakes in the Brazos River Basin. Authority also has entered Into contracts with the United States of America by virtue of which it has obtained the right to utilize for water supply purposes a portion of the usable storage space in various lakes owned and operated by the United States Army Corps of Engineers. Authority is authorized by the State of Texas to store State waters in the lakes owned by Authority and various lakes owned and operated by the United States Army Corps of Engineers in the Brazos River Basin, hereinafter collectively called the "System ", and to make such stored waters available for beneficial use. Authority is authorized to operate the System as a hydrologic unit pursuant to an order of the Texas Water Commission (now Texas Natural Resource Conservation Commission "TNRCC ") issued on July 23, 1964 ( "System Operation Order "). The Final Determination of All Claims of Water Rights in the Brazos River Basin and the San Jacinto - Brazos Coastal Basin Maintained by the Brazos River Authority. Fort Beryl County W.C.I.D. No. 1 and Galveston County Water Authority ( "Final Determination ") issued on June 26, 1985, by TNRCC clarified and amplified the System Operation Order. Under the System Operation Order as adjudicated by the Final Determination, Authority is authorized to operate the System as a hydrologic unit to more efficiently utilize the reservoirs that make up the System to make water available to meet the needs of Authority's customers. Authority and Purchaser have entered into certain raw water contracts (System Water Availability Agreement Between Brazos River Authority And City of Round Rock - Lake Georgetown And System Water Availability Agreement Between Brazos River Authority And City of Round Rock - Lake Stilihouse Hollow). Authority has also acquired the right to divert and use 25,000 acre -feet of water per year from the Colorado River Basin made available from the Lower Colorado River Authority (LCRA) under the "Water Sale Contract by and between Lower Colorado River Authority and Brazos River Authority Purchaser ", dated October 2000 (LCRA Contract) pursuant to the terms of House Bill 1437 of the 76"' Texas Legislative Session and codified under Section 27 of the LCRA Enabling Act. It is from the 25,000 acre -foot of a EXHIBIT IIA 0 [TX /RX NO 9570] 0003 SEP -06 -2002 15:50 FROM: TO :5122185563 P.004 water per year from the Colorado River Basin (the "LCRA Water ") that Purchaser now wishes to contract for Authority to make available 4,500 acre -feet of water per Calendar Year under the terms and conditions herein provided. 2. DEFINITIONS. a) The Term "Agreement" means this agreement. b) The Term "Agreement Rates" means the "Agreement Water Rate ", the "Agreement Reserved Water Charge ", and the "Agreement Inverted Block Rate" for water purchased pursuant to this Agreement as more fully described in Section 5, PRICING STRUCTURE, and in Section 7, UNCONDITIONAL NATURE OF PAYMENT OBLIGATION; PRICE, below. c) The term "Area of Use" means that certain area in Williamson County that lies outside of the watershed of the Colorado River, but excludes those munkipalities which were customers of the Lower Colorado River Authority as of May 20, 1997, and who are located in watersheds of both the Colorado and Brazos Rivers. d) The term "Authority" shall mean Brazos River Authority. e) The term "Board" shall mean the Board of Directors of Brazos River Authority. f) The term "Credit for System Rate Recovery" of "CSRR" means the credit described in Section 7. (c) of this Agreement. g) The term "Cost Recovery Fee" or "CRP means the fee described in Section 7. (b) (3) of this Agreement h) The Term "Federal Contracts" shall mean those contracts with the United Sates of America whereby Authority has acquired, is acquiring, or may acquire conservation storage capacity in Federal Reservoirs. 1) The term "Federal Reservoirs" shall include the following: Aquilla Dam and Reservoir Belton Dam and Reservoir Georgetown Dam and Reservoir Granger Dam and Reservoir Proctor Dam and Reservoir Somerville Dam and Reservoir Stillhouse Hollow Dam and Reservoir Whitney Dam and Reservoir j) The term "Fiscal Year" shall mean Authority's fiscal year from September 1 through August 31, or such other annual fiscal year period as Authority may later determine. k) The term "Highest Lawful Rate" shall mean the maximum rate which Authority may charge on obligations payable under this Agreement without violation of any applicable law or any applicable lawful regulation of any agency of the State of Texas or of the United States having jurisdiction of the matter. 1) The term "Industrial Use" shall mean the use of water in processes designed to convert materials of a lower order of value into forms having greater usability and commercial value, Including commerdal feddlot operations, commercial flsh production, and the development of power by means other than hydroelectric. m) The term "Irrigation Use" shall mean the use of water for the irrigation of crops, trees, and pastureland, induding, but not limited to, golf courses and parks which do not receive water through a municipal distribution system. 09/06/2002 FRI 15:50 [T% /R% NO 9570] 0004 SEP -06 -2002 15:51 FROM: TO:5122185563 P.005 n) The term "LCRA" means Lower Colorado River Authority. o) The term "LCRA Contract" means the "Water Sale Contract by and between Lower Colorado River Authority and Brazos River Authority, Purchaser" dated October 2000. p) The term "LCRA Rates" means the LCRA rates and charges for sale of water for municipal purposes as delineated in Section II. B. of the LCRA Contract. q) The term "LCRA Water" means the 25,000 acre -feet of water per year purchased by Brazos River Authority from LCRA pursuant to House Bill 1437 of the 76 Texas Legislative Session. r) The term "Mining Use" shall mean the use of water for mining processes including hydraulic use, drilling, washing sand and gravel, and oil field repressuring. s) The term "Municipal Use" shall mean the use of potable water within a community or municipality and its environs for domestic, recreational, commercial, or Industrial purposes or for the watering of golf courses, parks and parkways. t) The term "Purchaser" shall mean City of Round Rock. u) The term "System" shall mean Authority's Water Supply System and shall include certain of Authority's facilities and properties insofar as they are related to making water available from the System, to wit, as follows: Morris Sheppard Dam and Possum Kingdom Reservoir, DeCordova Bend Dam and Lake Granbury, Sterling C Robertson Dam and Lake Limestone, Authority's conservation storage In the Federal Reservoirs, and LCRA Waterobtained pursuant to the LCRA Contract, together with all future extensions, improvements, enlargements, and additions to and replacements of the System, and all replacements thereof whether from surface water supplies, groundwater, or a combination thereof, specifically added to the System by resolution of the Board; provided that, notwithstanding the foregoing, the term System shall not indude (i) any of Authority's facilities and properties not specifically included in the System by the terms of this Agreement or not added by the subsequent resolution of the board, and (ii) any water supply, wastewater or other fadlities which have been or are declared not to be a part of the system and which may be acquired or constructed by Authority with the proceeds from the issuance of "Special Fadlities Bonds," which are hereby defined as being special revenue obligations of Authority which are not secured by or payable from the revenues of the System but which are secured by and payable solely from special contract revenues or payments received from any persons or other legal entity or entities in connection with such special facilities. v) The term "System Agreements" means those certain raw water contracts titled "System Water Availability Agreement Between Brazos River Authority and City of Round Rock - Lake Georgetown" and "System Water Availability Agreement Between Brazos River Authority and City of Round Rock - Lake Stillhouse Hollow ", dated contemporaneously with this Agreement herewith. ' w) The term "System Operation Order" shall mean that certain order of TNRCC or its predecessor dated July 23, 1964, as adjudicated by order of the TNRCC or Its predecessor on June 26, 19135, in the Final Determination of all Claims of Water Rights in the Brazos River Basin and the San Jacinto - Brazos Coastal Basin Maintained by the Brazos River Authority. Fort Bend County W.CLD. No. 1 and Galveston Cowry water Authority, 09/06/2002 FRI 15:50 [TX /RX NO 9570] lJ 005 SEP -06 -2002 15:51 FROM: T0:5122185563 x) The term "System Rate" or "SR" shall mean the rate per acre -foot of water established by Authority from time to time under its system -wide pricing methodology. y) The term "Total Annual Budgeted System Costs" shall mean the amounts approved by Authority as estimated costs of the System in the annual budgets adopted by Authority for a given Fiscal Year including, without limitation, amounts budgeted to meet Annual System Operation and Maintenance Expenses and Annual Capital Related Costs. z) The term 'Total System Billing Units" shall mean the total amount of water (expressed in acre-feet) determined by Authority under accepted engineering practice as necessary to be reserved from firm yield produced by storage in the System to fulfill its commitments for which Authority receives payment under long term (in excess of five years) water sales contracts with Purchaser and Authority's other customers; provided, however, such term shall not Include amounts of water required by appropriate governmental authority to be reserved in the System for us for bay and estuary purposes, in- stream uses, or for other similar environmental, public, or other beneficial uses to the extent Authority is not adequately compensated for any such requirement. 3. EFFECTIVE DATE. The effective date of this Agreement is September 1, 2002. 4. AVAILABILITY OF WATER. While this Agreement remains in force, Authority agrees to make available to Purchaser an amount of water not to exceed 4,500 acre -feet of water per Calendar Year under the following conditions: a) Notwithstanding anything herein to the contrary, Authority's obligation to make water available to Purchaser under this Agreement is subject to, and limited by, the rights of Authority to obtain the LCRA Water pursuant to the LCRA Contract. Purchaser acknowledges that Purchaser has received a copy of the LCRA Contract and is familiar with the rights of Authority thereunder, and the limitations on Authority's rights thereunder to obtain the LCRA Water. b) Authority may interrupt or curtail the water supplied to Purchaser under this Agreement to the extent Authority experiences interruption or curtailment of water supplied to it under the LCRA Contract for any reason. c) Water supplied under this Agreement shall only be used within the Area of Use. d) Purchaser acquires no property rights in the water made available to it under this Agreement beyond the right to have the water made available to It for diversion and use under the terms of this Agreement. This right of use extends to direct reuse (flange to flange) of the water made available under this Agreement. Purchaser represents, and Authority relies on such representation, that all water to be made available by Authority under this Agreement to Purchaser shall be used solely for municipal purposes. P.006'016 09/06/2002 FRI 15:50 [TX /RX NO 9570] IJ006 SEP -06 -2002 15:52 FROM: TO:512218.5563 P.007'016 5. PRICING STRUCTURE a) The pricing structure for water rates under this Agreement is dependent upon the pricing structure of water made available to the Authority under the LCRA Contract unless or until the Authority's System Rate exceeds the price derived from the formula provided for price calculation in Section 7, below. At such time, the price under this Agreement shall be the Authority's System Rate. b) The LCRA Water is provided to Authority under the LCRA Contract pursuant to the following pricing structure: (1) The "Water Rate" for LCRA Water is charged for water diverted and used during a calendar year. The current Water Rate is $105.00 per acre-foot of water per year. (2) The "Reserved Water Charge" for LCRA Water is charged for water under contract but not diverted and used during a calendar year. The Reserved Water Charge is 50% of the Water Rate, or currently $52.50 per acre-foot of water per year. (3) The "Inverted Block Rate" for LCRA Water is charged for all water used in excess of the total contractual amount and is currently $200.00 per acre -foot of water per year. (4) The "Conservation Charge" for LCRA Water is currently 25% of the Water Rate, the Reserved Water Charge, or the Inverted Block Rate, as applicable. (5) The current "Total LCRA Rates" for LCRA Water are as follows: (a) The 'Total LCRA Water Rate" is the Water Rate + the Conservation Charge, currently $131.25 an acre-foot. (b) The 'Total LCRA Reserved Water Charge" Is the Reserved Water Charge 4- the Conservation Charge, currently $65.63 an acre -foot. (c) The "Total LCRA Inverted Block Rate" is the Inverted Block Rate + the Conservation Charge, currently $250.00 an acre-foot. (d) The Authority makes water available to Purchaser under this Agreement pursuant to the following pricing structure: (1) The "Agreement Reserved Water Charge" for all water agreed to be made available under this Agreement whether or not it is diverted an used during a calendar year. The current Agreement Reserved Water Charge is $4922 per acre -foot of water per year, the calculation for which is set out in Section 7.c., below. (2) The "Agreement Water Rate" for only water that Is diverted and used during a calendar year. The Agreement Water Rate equals the Agreement Reserved Water Charge and is in addition to the Agreement Reserved Water Charge. (3) The "Agreement Inverted Block Rate" for water used In excess of the amount agreed to be made available under this Agreement. The Agreement Inverted Block Rate Equals the Total LCRA Inverted Block Rate. 6. DATE AND PLACE OF PAYMENTS a) Payments to be made hereunder shall be made at Authority's office in Waco, McLennan County, Texas. Authority contemplates that by September 1 of each Fiscal Year it will have adopted budgets for Authority for said Fiscal Year and established the System Rate and the Agreement Rates for said Fiscal Year. Payments for each Fiscal Year may be made under one of three payment options from which 09/06/2002 FRI 15:50 [TX /RX NO 9570] Q007 SEP -06 -2002 15:52 FROM: TO:5122185563 P.008'216 Purchaser will select at the beginning of each Fiscal Year. The payment due at the beginning of each Fiscal Year will be for the water agreed to be provided during the next calendar year, and shall be based on the Agreement Reserved Water Charge. Annual payments for water provided at the Agreement Reserved Water Charge shall be made on or before September 15 each Fiscal Year Quarterly payments shall be made on or before September 15, December 15, March 15, and June 15 each 9scal Year. Monthy payments shall be made on or before the fifteenth of each month each Fiscal Year. Quarterly payments or monthly payments shall include a multiplier to be applied to the annual payment to allow Authority to recover interest lost on any unpaid balance plus a service charge for administrative costs, inducing but not limited to costs involving the billing, accounting, and collecting for the quarterly or monthly payments. The multiplier to recover lost interest revenue and the service charge for administrative costs shall be determined on an annual basis and , shall be just and reasonable. If the effective date of this Agreement is other than January 1, the amount of water available to Purchaser and the payment owed by Purchaser will be prorated for the remaining monthly of the Calendar Year, 2002. b) The charge for any water actually diverted and used during the next calendar year will be billed to Purchaser an a monthly basis based on the actual diversion and usage for the previous month at the Agreement Water Rate. c) Purchaser may elect to defer payment of its obligations for water purchased pursuant to Agreement Reserved Water Charges by providing Authority notice of such election in writing within 60 days from the date of execution of this Agreement. In no instance shall the deferral terms extend beyond the initial ten years of this Agreement. If Purchaser selects deferred payment, the following structure will be used (1) Years 1 -2: Purchaser will receive a credit of 50% of the Agreement Reserved Water Charge. (2) Years 3-4: Purchaser will receive a credit of 25% of the Agreement Reserved Water Charge. (3) Years 5 -6: Purchaser will receive no deferral of the Agreement Reserved Water Charge. (4) Year 7: Purchaser will pay 125% of the Agreement Reserved Water Charge. (5) Year 8-9: Purchaser will pay 150% of the Agreement Reserved Water Charge. (6) Year 10: Purchaser will pay the remaining outstanding deferred balance plus 100% of the current year's Agreement Reserved Water Charge. Notwithstanding anything herein to the contrary, in the event the differed payments calculation yields a rate that is less than the then current Authority System Rate, the full System Rate will be the rate charged for the Fiscal Year's payment. Unpaid balances will accumulate interest based on actual Authority interest rates eamed on the Authority's Investments. The Authority's interest rate will be the Authority's average annual portfolio yield plus 0.5 percent per annum for administrative costs. Interest charges will be assessed on an annual basis using simple interest, compounded annually. 09/06/2002 FRI 15:50 [TX /R% NO 9570] Q008 SEP - 06 -2002 15:53 FROM: TO:5122185563 P.009 7. UNCONDITIONAL NATURE OF PAYMENT OBLIGATION: PRICE. a) Purchaser unconditionally agree to pay Authority in accordance with the terms of this Agreement for the water agreed to be made available to Purchaser from the LCRA Water pursuant to this Agreement. b) The Agreement Rates are derived using the following components: (1) The Authority's System Rate (currently $29.90 per acre - foot of water per year). (2) The Total LCRA Water Rate, Total LCRA Reserved Water Charge, or Total LCRA Inverted Block Rate (as defined in Section S.b.(5), above). (3) The "Cost Recovery Fee" (the applicable Total LCRA Rate minus the Authority's System Rate minus the Credit for System Rate Recovery). c) The "Credit for System Rate Recovery" (a 25% discount from the Total LCRA Water Rate or the Total LCRA Reserved Water Rate, but not from the Total LCRA Inverted Block Rate). The Agreement Reserved Water Charge (ARWC) Is the System Rate plus the Cost Recovery Fee. Using current components, the Agreement Reserved Water Charge is derived as follows: ARWC= SR + CRF ARWC= $26.00 + (Total LCRA Reserved Water Charge - SR -CSRR) ARWC= $26.00 + ($65.63 - $26.00 - $16.41) ARWC= $26.00 + $23.22 ARWC= $49.22 d) The Agreement Water Rate is equal to the Agreement Reserved Water Charge, currently $49.22, and is In addition to the Agreement Reserved Water Charge. e) The Agreement Inverted Block Rate is equal to the Total LCRA Inverted Block Rate, currently $250.00. f) Authority may, and it specifically reserves the right to, revise the Agreement Rates from time to time (usually prior to the start of each Fiscal Year) to reflect changes in the System Rate and the LCRA Rates. Authority shall not increase the Agreement Rates other than on a Fiscal Year basis except for unforeseeable reasons of a serious and substantial nature. Such reasons include Force Majeure, government legislation or regulation, permit requirements, or changes in the LCRA Rates. g) Notwithstanding anything herein to the contrary, In the event the Agreement Rates calculation yields a rate that is less than the then current Authority System Rate, the System Rate will be the Agreement Rates. 8. SOURCE OF PAYMENTS. The payments to be made hereunder by Purchaser shall constitute operating expenses of Purchaser's water works system or Purchaser's combined water works and sewer system. Purchaser shall charge rates for services of its water works system or its combined water works and sewer systems that will be sufficient to pay the operating and maintenance expenses thereof, including the payments provided for hereunder, and the interest on and principal of, as the same come due and mature, obligations issued by Purchaser now or hereafter payable from the revenues of said system or systems. 09/06/2002 FRI 15:50 [TX /RX NO 9570] 0009 SEP -06 -2002 15:54 FROM: T0;5122185563 P.010 9. INTEREST ON PAST DUE PAYMENT: COLLECTION. In the event of failure of Purchaser to make any payment to authority provided to be made in this Agreement at the time when same shall be due, the past due payment shall bear Interest at the lesser of the highest rate allowed by applicable law or 18 percent per year. Regardless of any other provision contained in this Agreement, Authority shall never be entitled to receive, collect, or apply as interest under this Agreement any amount of money determined at a rate which exceeds the Highest Lawful Rate, If Authority ever charges, receives, collects, or applies as interest an amount in excess of that permitted by application of the Highest Lawful Rate, then any such amount which would be excessive interest shall be deemed a partial prepayment of amounts payable under this Agreement which do no constitute interest and shall be treated hereunder as such; and if all other obligations payable under this Agreement shall have been paid in full, then Authority shall refund the amount of such excessive Interest. 10. REMEDIES FOR NONPAYMENT OR DEFAULT. Should Purchaser fail to make any payment to Authority when due hereunder or otherwise be In default under this Agreement, Authority at its sole option and In addition to and without impairing any other remedy available to it on account of the default, may elect to either (i) suspend its duty to make available water to Purchaser under this Agreement or (8) terminate this Agreement, by providing written notice of such suspension or termination delivered to Purchaser on or before 30 days before the date specified in said notice of suspension or termination, provided that the nonpayment or other default with respect to which notice of suspension or termination of this Agreement has been given, shall not be cured by the date spedfled in such notice. Nothing in this Agreement shall be construed in any manner so as to abridge, limit, or deprive either party hereunto or any means which it would otherwise have of enforcing any right or remedy either in law or in equity for breach of any of the provisions hereof. 11. REMEDIES OF OVERUSE. Purchaser recognizes that any diversion of water in excess of its contractual amount may impact Authority's ability to make available water to Authority's other raw water customers. Purchaser agrees that If for any reason it needs to exceed the contractual annual amount of water to be made available to It under MIS Agreement, Purchaser will give written notice to Authority 30 days in advance of the need for such additional water and in such notice will state the reason for the additional need, the amount of water needed to be made available, and the duration of the need. Authority, in its sole discretion, may make all or a portion of the requested water available. Should Authority determine that It can make all or a portion of the requested water available without adversely Impacting its ability to make water available to its other customers, Purchaser agrees to pay for such water to be made available in advance at a rate that is equal to the then current Agreement Invested Block Rate. Should Purchaser fail to notify Authority of Its need for additional water to be made available, and exceed the contractual annual amount of water to be made available to it, or should Purchaser, after notification of Authority and Authority's 09/06/2002 FRI 15:50 [TX /RX NO 95701 11010 SEP -06 -2002 15:54 FROM: T0:5122185563 P.011 determination that additional water is not available for Purchaser's use, nonetheless exceed the contractual amount of water to be made available to it Authority may cancel this Agreement by providing written notice of such cancellation delivered to Purchaser on or before thirty (30) days before the date specified in said notice of cancellation. Nothing in this Agreement shall be construed in any manner so as to abridge, limit, or deprive either party hereunto of any means which it would otherwise have of enforcing any right or remedy either in law or in equity for breach of any of the provisions hereof. 12. FACILITIES. All new fadlities that are located in the Area of Use that are used to transport raw water that is purchased pursuant to this Agreement exclusively may be owned and operated by LCRA, at Its sole option. All new facilities or all substantial expansions to facilities that are located In the Area of Use that treat water or transport treated water that Is purchased pursuant to this Agreement and that are constructed by BRA or LCRA shall be Brazos - Colorado Alliance projects. The LCRA may own, at its sole option, a portion of any such facilities that is commensurate with the percentage that LCRA water (Le., water supplied under the LCRA Contract) bears to the total amount of water supplied by BRA and LCRA for treatment or transportation by such facilities. For example, if twenty-five percent (25 %) of the wat used at an Alliance facility is supplied by LCRA under the LCRA Contract, the LCRA may own twenty -five percent (25 %) of that facility. All such facilities in the Area of Use, however, shall be operated by BRA. All new facilities and all substantial expansions to facilities that are located in the Area of Use that treat or transport treated water purchased pursuant to this Agreement that are constructed by Purchaser may be owned and /or operated by Purchaser if such ownership and/or operation is desired by Purchaser. Purchaser acknowledges that the economics of scale and efflciendes of use made pos by regionalization of water treatment facilities are highly desirable. Purchaser, therefore, agrees to negotiate In good faith with BRA and LCRA to maximize the potential for regionalization of water treatment and transportation fadlities, either new fadlities or substantial expansion of facilities, located In the Area of Use used to treat or transport water that is purchased pursuant to this Agreement. 13. METERING. Purchaser agrees that, at its sole cost and expense, It shall install, operate and maintain meters for the accurate measuring of all water diverted by Purchaser under this Agreement in order to aid Authority In accurately reporting actual water usage to the TNRCC as required by applicable law or regulation. Such meter or meters shall be tested and calibrated for accuracy by and at the expense of Purchaser once each fiscal year at intervals of approximately 12 months, and a report of such test and calibration shall be fumished to Authority. Authority shall be given at least two prior days notice of the time of any test and calibration of Purchaser's meters, or any of them, and Authority shall have the right to have a representative present at each test to observe the test and any adjustments found thereby to be necessary. Authority shall have the right to inspect and check the accuracy of Purchaser's meter or meters at any 09/06/2002 FRI 15:50 IT% /RI NO 9570] U011 SEP -06 -2002 15:55 FROM: TO:51221B5563 P.012'R16 time during usual business hours after not less than one nor more than five (5) days notice. In the event any question arises at any time as to the accuracy of any such meter, such meter shall be tested promptly upon demand of Authority, the expense of such test to be borne by Authority if the meter is found to be correct and by Purchaser if it is found to be incorrect. Readings within 2% of accuracy, plus or minus, shall be considered correct. If, as a result of any test, any meter if found to be registering inaccurately (i.e., in excess of 2% of accuracy, plus or minus), the readings of such meter shall be corrected at the rate of its inaccuracy for any period which is definitely known and agreed upon, but in case the period is not definitely known and agreed upon, then the shorter of the following periods shall be used as the basis for correction; a) a period extending back either 60 days from the date of demand for the test or, if no demand for the test was made, 60 days from the date of the test; or b) a period extending back half of the time elapsed since the last previous test; and the records of readings shall be adjusted accordingly. Following each test of a meter, Purchaser shall cause the same to be calibrated to register accurately. 14. REPORTING. Purchaser agrees that it will keep accurate records of the daily readings from the meter or meters installed pursuant to Section 13., Metering, above. These records shall be subject to inspection by Authority at reasonable times and places. Purchaser shall submit reports to Authority by the 10 day of each month showing the amount of water diverted under this Agreement each day during the prececing month. 15. SYSTEM AGREEMENT. This Agreement does not affect the rights and obligations of Authority and Purchaser under the System Agreements. 16. CONSERVATION OF WATER. It is the intent of the parties to this Agreement to provide to the maximum extent practicable for the conservation of water, and Purchaser agrees that it is a condition of this Agreement that It shall maintain and operate its facilities in a manner that well prevent unnecessary waste of water. Authority, in accordance with applicable law or regulation, may from time to time adopt reasonable rules and regulations relating to water conservation. Purchaser agrees to abide by the "Brazos River Authority Drought Contingency Policy` adopted by the Board on )anuary 16, 1989, or any subsequent Drought Contingency Policy duly adopted by the Board and any Drought Contingency Plans developed under the Drought Contingency Policy. If required by applicable law or regulation or by Authority, Purchaser agrees to implement a water conservation and drought management program in accordance with a water conservation plan and that the water made available and diverted by Purchaser pursuant to this Agreement will be used in accordance with such conservation plan, and with the regulations of the Texas Natural Resource Conservation Commission (or other appropriate regulating authority) applicable to retail public utilities. Purchaser further agrees to make available its water conservation and drought contingency programs to Authority and LCRA for review. If required by applicable law or 09/06/2002 FRI 15:50 [TX /RX NO 9570] U012 SEP -06 -2002 15:55 FROM: TO:5122185563 P.013' 16 regulation Purchaser agrees that, in the event Purchaser furnished water or water services to a third party that in turn will furnish the water or services to the ultimate consumer, the requirements relative to water conservation shall be met through contractual agreements between Purchaser and the third party providing for the established and implementation of a water conservation program in compliance with such applicable law or regulation. 1f Purchaser fails to comply with its water conservation plan, Authority may, at its sole option terminate this Agreement without recourse unless such default is cured within thirty (30) or, if the nature of such default is not susceptible to being cured within such thirty (30) day period, such longer period of time during which Purchaser diligently prosecutes the cure of such default, not to exceed ninety (90) days of Purchaser's receipt of written notice of such default. 17. WATER QUALITY. As a further condition of this Agreement, Purchaser also agrees that it will comply with applicable water quality standards of the State in the diversion, use, reuse, or discharge of water made available hereunder. Should Purchaser be determined by any competent legal authority to have degraded the quality of water of the State or to have violated any water quality standard established by law or lawfully adopted regulation, and subsequently fail to take action with reasonable diligence to correct such deficiency as directed by competent legal authority, such failure shall constitute an event of default under this Agreement. Authority, in accordance with applicable law or regulation may from time to time adopt reasonable rules and regulations relating to water quality protection. If required by applicable law or regulation or by Authority, Purchaser agrees to implement appropriate water quality protection measures including, without limitation, a non -point source water pollution abatement program in accordance with a non -point source water pollution abatement plan. 18. WATER SURPLUS TO PURCHASERS NEEDS. Purchaser may not unilaterally cancel this Agreement or reduce the amounts of water agreed to be made available to it and for which availability it is obligated to pay under the terms of Sections 4. And 7., above, except as provided in Section 26, below. Purchaser may not sell or make available to others the water agreed to be made available to it under this Agreement, except in the case of municipal uses, as potable treated water. However, should Purchaser determine that it has water surplus to its anticipated needs from the water to be made available by Authority under this Agreement, Purchaser may notify Authority as to the amount of water no longer needed to be made available to it. Authority will use reasonable efforts to find a third party who is able and willing to pay for such availability for a period to the end of thls Agreement. If Authority is successful in finding such a third party suitable to it to acquire Purchaser's interest in its available surplus for a period of time to the end of this Agreement, this Agreement will be amended to reduce the amount of water to be made available to Purchaser by the amount of availability paid for by such third party, and Purchaser will be relieved of the obligation to make payments for such availability of water. 09/06/2002 FRI 15:50 [T% /RX NO 9570] 2h013 SEP -06 -2002 15:56 FROM: TO :5122185563 P.014/016 19. SHORTAGES. Authority makes no guarantee that any lakes or other sources of supply in the Colorado River Basin will be maintained at any specific level at any particular time. Purchaser bears all transportation losses prior to final diversion. It is fully understood by the parties hereto that the level of lakes or other sources of supply in the Colorado River Basin will vary as a result of weather conditions beyond the control of Authority, and that this instrument is merely an agreement to require Authority to make available water when and if water is available to Authority under this Authority's LCRA Contract, and to allow Purchaser to make withdrawals of the water subject to the general law on distribution and allocation of water during shortages of supply. Authority covenants that it will use its best reasonable efforts to maintain and preserve its rights under the LCRA Contract. If for any reason the availability of water to Authority under the LCRA Contract is restricted, impaired, or otherwise limited, Authority agrees, and Purchaser covenants, that Authority may fairly and equitably apportion and ration the available water supply from the LCRA Contract among all its several customers receiving water from Authority as a result of the LCRA Contract, including Purchaser. 20. FORCE MAJEURE. Notwithstanding anything herein to the contrary, neither party hereto shall be under any liability or be deemed in default with respect to its obligations under this Agreement for any failure to perform or for delay In performing such party's obligations hereunder (except for the obligation to pay money) where such failure or delay is due to force majeure, while and to the extent that such performance Is prevented by such cause. The term force majeure means acts of God, flre, storm, flood, war, riots, sabotage, drought, lack of availability of water due to sedimentation, low inflows of water to, or lack of water supply in the System or from the Colorado River basin to be made available under the LCRA Contract, strikes or other differences with labor (whether or not within the power of the parties to settle same), dear or orders of the courts or other governmental authority, or other similar or dissimilar causes not within the reasonable control of such party and not due to negligence of such party. Each party shall use due diligence to resume performance of any obligation suspended by force majeure at the earliest practicable time. 21. WAIVER. Any waiver at any time by any party of Its rights with respect to default under this Agreement shall not be deemed a waiver of such rights with respect to any subsequent default or matter. 22. NOTICES AND CERTIFICATIONS. Notices and certifications provided for in this Agreement shall be in writing. The same shall be delivered by mailing certified mail, postage paid, retum receipt requested, to the respective parties at the following addresses; 09/06/2002 FRI 15:50 [T% /R% NO 95701 lj014 SEP -06 -2002 15:57 FROM: Authority: Brazos River Authority 4600 Cobbs Drive P.O. Box 7555 Waco, Texas 76714 -7555 Telephone: (254) 761 -3100 Fax: (254) 761 -3207 T0:51221 95563 P.015 -'016 Purchaser: City of Round Rock 221 East Main Street Round Rock, Texas 78664 Telephone: (512) 218 -5400 Fax: (512) 218-7097 Either party may change Its address as shown above by written notice to the other party. Notices shall be deemed to have been delivered on the business day following their deposit in the United States mail, postage paid, and properly addressed and certified. 23. OTHER REQUIREMENT. This Agreement is subject to all conditions, provisions, and limitations induded in Authority's water rights from the TNRCC and the System Order and the LCRA Contract. Further, this Agreement Is subject to all applicable Federal, State and local laws, and any applicable ordinances, rules, orders and regulations of any local, State or Federal governmental authority having jurisdiction. However, nothing contained in this Agreement shall be construed as a waiver of any right to question or contest any law, ordinance, order, rule, or regulation of any govemmentai authority. 24. SEVERABIUTY. The provisions of this Agreement are severable, and If for any reason any one or more of the provisions contained in this Agreement shalt be held to be invalid, illegal, or unenforceable in any respect, the invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement and this Agreement shall remain in effect and be construed as if the Invalid, illegal, or unenforceable provision had never been contained In the Agreement. 25. ASSIGNMENT. This Agreement may be assigned by Purchaser only with the written consent of Authority, which consent shall not be unreasonably withheld or delayed. Only assignment of this entire Agreement will be approved. Releases of lesser obligations must be authorized under Section 18., Water Surplus to Purchaser's Needs, above. 26. TERMS OF AGREEMENT. The term of this Agreement shall begin on the Effective Date, Section 3., and shall end on the fifty (50) year anniversary of the Effective Date. If Authority is able to extend or renew its LCRA Contract, Authority and Purchaser agree to negotiate In good faith regarding terms for extension or renewal of this Agreement. 09/06/2002 FRI 15:50 [T% /R% NO 95701 01015 SEP- 06-2002 15:57 FROM: TO:5122185563 P.016/016 If Purchaser is current on all payments due Authority under this Agreement, Purchaser may terminate this contract, In whole or in part, on February 15 of any year following the expiration of ten (10) years measured from the Effective Date by providing six (6) months prior written notice to Authority, that is by August 15 of the year preceding the February 15 termination date. This Agreement shall be null and void in the event that the interbasin transfer permit referenced in Section 3, above, is not issued by the TNRCC with the two (2) years of the date of filling of the application for said interbasin transfer permit CITY OF ROUND ROCK BRAZOS RIVER AUTHORITY By: By: Name Phillip 3. Ford Title: General Manager /CEO ATTEST: ATTEST: Assistant Secretary 09/06/2002 FRI 15:50 iT % /RY NO 95701 IJ016 DATE: September 20, 2002 SUBJECT: City Council Meeting — September 26, 2002 ITEM: 11.D.9. Consider a resolution authorizing the Mayor to execute a System Water Availability Agreement for Colorado River Basin Water with the Brazos River Authority for the purchase of water. Resource: Jim Nuse, Chief of Operations/Assistant City Manager Tom Clark, Director of Utilities History: The City is requesting a total of 4,500 acre -feet of water per Fiscal Year from the System. The Texas Legislative allowed 25,000 acre -feet of water to be transferred from the Colorado Basin to the Brazos Basin. The City has an agreement for 6,944 acre-feet and this agreement will allow Round Rock to access an additional 4,500 acre -feet of that water. Funding: Cost: Reserve charge is $49.22/acre -foot. Source of funds: Utility Fund - Operating Budget Outside Resources: Brazos River Authority Impact: This will guarantee a water supply beyond 2050. Benefit: This is a reliable low cost source of water. Public Comment: N/A Sponsor: N/A