Ordinance No.485 AN ORDINANCE AUTHORIZING THE SALE OF WATER TO THE LUCKIAMUTE DOMESTIC WATER COOPERATIVE, AND DECLARING AN EMERGENCY

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1 Ordinance No.485 AN ORDINANCE AUTHORIZING THE SALE OF WATER TO THE LUCKIAMUTE DOMESTIC WATER COOPERATIVE, AND DECLARING AN EMERGENCY Whereas, the City of Falls City (City) owns and operates a water supply distribution system with a capacity currently capable of serving the citizens of the City together with water users to be served by the Luckiamute Domestic Water Cooperative (Coop), an Oregon cooperative corporation; and Whereas, the City and Coop have negotiated an agreement for the City to supply a limited amount of water to the Coop, while retaining the right of the City's users to priority; and Whereas, the City Council has found the sale of water to the Coop to be in the best interests of the City and that the water sold to the Coop will not be needed by the City during the period of the agreement; The city of Falls City does ordain as follows: Section 1. Authorization for Sale of Water. The sale of water by the City of Falls City to the Luckiamute Domestic Water Cooperate is authorized, under the terms and conditions as set forth in the Water Purchase Agreement attached hereto and incorporated herein by reference. Section 2. Effective Date. The City Recorder/Administrator is authorized and directed to execute the above-referenced Water Purchase Agreement on behalf of the City. The effective date of the Agreement shall be the effective date of this ordinance or the corresponding resolution by the Coop's Board of Directors, whichever takes effect later. Section 3. Severability. Should any provision(s) of this ordinance or the Water Purchase Agreement be determined to be invalid, all other provisions shall remain in full force and effect. Section 4. Emergency. Inasmuch as the provisions of this ordinance are necessary for the immediate preservation of the peace, health and safety of the citizens of Falls City, Oregon, an emergency is hereby declared to exist, and this ordinance shall be in full force and effect immediately upon its passage by the City Council. Read for the first time the 10th day of July, Read for the second time the 10th day of July, Passed by the Falls City Council at its regular meeting on the 10th day of July, Approved: Virginia C. Lindekugel, Mayor Rick A. Hohnbaum, City Recorder/Administrator

2 WATER PURCHASE AGREEMENT This Agreement is for the sale and purchase of water and is entered into on July, 2000 between the City of Falls City, a municipal corporation as SELLER, and Luckiamute Domestic Water Cooperative, an Oregon cooperative corporation as PURCHASER. WHEREAS, PURCHASER is organized and established under the provisions of Oregon statute for the purpose of constructing and operating a water supply distribution system serving water users within the area described in plans now on file in the office of the PURCHASER, and to accomplish its purpose, PURCHASER requires an ongoing supply of treated water; and WHEREAS, SELLER owns and operates a water supply distribution system with a capacity currently capable of serving the citizens of the City of Falls City together with water users to be served by PURCHASER; and WHEREAS, by ordinance No. enacted on the day of July, 2000 by SELLER, the sale of water to PURCHASER in accordance with the terms set forth therein, and the execution of this contract was duly authorized; and WHEREAS, by resolution of the Board of Directors of PURCHASER enacted on the day of July 2000, the purchaser of water from SELLER in accordance with the terms set forth therein and the execution of this contract was duly authorized; NOW THEREFORE, in consideration of the foregoing and the mutual agreements set forth below, the parties agree as follows: 1. SELLER shall furnish PUR CHASER at the point of delivery specified below, during the term of this contract or any renewal thereof, potable treated water meeting applicable purity standards of the Oregon Health Division in such quantity as may be required by PURCHASER, but not to exceed 3.000,000 gallons per month. 2. SELLER will, at all times, operate and maintain its water system in an efficient manner and will take such action as may be necessary to furnish PURCHASER with quantities of water required by PURCHASER. Temporary or partial failures to deliver water shall be remedied with all possible dispatch. In the event of an extended shortage of water, the supply of water to PURCHASER shall be reduced so that SELLER'S users receive water as a priority during the period of water shortage. 1

3 3. SELLER shall furnish water to PUR CHASER at a reasonably constant pressure calculated at 60 pounds per square inch from an existing 6-inch main supply at a point located at the Falls City Cemetery. If a greater pressure is required by PURCHASER, the cost of providing such greater pressure shall be borne by PURCHASER. Emergency failures of pressure or supply due to main supply line breaks, power failure, flood, fire, earthquake or other catastrophe shall excuse SELLER from this provision for such reasonable period of time as may be necessary to restore service. 4. PURCHASER shall furnish, install, operate and maintain at its own expense all necessary metering equipment, backflow device, pressure gauge and water lines from the point of delivery and shall calibrate such metering equipment when requested by SELLER, but no more frequently than once every twelve months, PURCHASER shall be responsible for obtaining all permits and fulfilling all other legal requirements necessary for the installation and operation of the water delivery system. 5. The water meter shall be read by SELLER on or about the 25th day of each subsequent month and SELLER shall furnish PURCHASER on or about the first day of each month with an itemized statement of the amount of water furnished PURCHASER during the preceding month. 6. PURCHASER shall pay SELLER, not later than the 20th day of each subsequent month for water delivered during the previous month, at the rate of $1.30 per 1000 gallons. 7. On or before the 15th of June of each year during the term of this agreement, the parties shall review the water rate referred to in paragraph 6. Any increase in the water rate shall not exceed 75% of the then existing rate which SELLER charges to its bulk users. In no event shall the rate increase by more than 15% in any one year. 8. This contract shall extend for a term of 10 years from the date hereof and thereafter, may be renew ed or extended for such term or terms as may be agreed upon by the parties. 2

4 9. Five days prior to the estimated date of completion of construction of PURCHASER'S water supply distribution system, PURCHASER shall notify SELLER in writing of the date for initial delivery of water. SELLER shall have the right of final inspection upon connection to SELLER'S water supply to verify compliance with APWA standards. PURCHASER shall be responsible for any expense incurred by SELLER in obtaining an independent inspection. 10. When requested by PURCHASER, SELLER will make available to PURCHASER at the point of delivery, water sufficient for testing, flushing and trench filling PURCHASER'S system during construction. 11. This contract is subject to the rules, regulations and laws of the State of Oregon and the parties shall cooperate in obtaining the permits, certificates and board licenses as may be required to comply therewith. Each party shall notify the other in writing of any notice received by either party of a violation of Oregon Health Division standards or other legal requirements. All notices shall be delivered by certified mail addressed as follows: SELLER: PURCHASER: City of Falls City Luckiamute Domestic Water Coop. Attn: City Administrator Attn: Manager PO Box Suver Road Falls City OR Monmouth OR Phone No Phone No In the event that SELLER elects to sell SELLER'S water to other entities operating a water supply distribution system, PURCHASER shall have the right of first refusal to purchase said water on the same terms and conditions under which SELLER elects to sell said water to said user. SELLER shall notify PURCHASER in writing of SELLER'S election to sell, and the terms of said sale, and PURCHASER shall have twenty days thereafter to notify SELLER in writing that it accepts the terms thereof. 1. Each party shall indemnify the other from all claims for which the indemnitor is solely liable under this agreement. This mutual right of indemnity is in addition to and not in lieu of any other rights of contribution or indemnity that may exist under Oregon law. The right of indemnity extends to officers. employees and agents of the indemnitee party. Indemnify" as used herein means to indemnify, defend and hold harmless. 3

5 IN WITNESS WHEREOF, the parties hereto, acting under authority of their respective governing bodies, have caused this agreement to be duly executed in duplicate, each of which shall constitute an original. DATE: SELLER: CITY OF FALLS CITY BY: Title: DATE: PURCHASER: LUCKIAMUTE DOMESTIC WATER COOPERATIVE BY: Title: Water Purchase Agreement 4