1985-1231122L
NO 25 :f:Z'3
AN ORDINANCE OF THE CITY OF DENTON, TEXAS, APPROVING AN AGREEMENT
FOR THE PURCHASE OF UNTREATED WATER FROM THE CITY OF DALLAS,
AUTHORIZING THE MAYOR TO EXECUTE THE AGREEMENT, AND PROVIDING FOR
AN EFFECTIVE DATE
WHEREAS, Denton is desirous of purchasing untreated water from
Dallas and Dallas desires to sell untreated water to Denton
pursuant to the terms and conditions contained in the attached
agreement, and
WHEREAS, the Public Utility Board for the City of Denton has
recommended approval of the attached agreement,
NOW, THEREFORE, THE COUNCIL OF THE CITY OF DENTON, TEXAS, HEREBY
ORDAINS
SECTION I
That the City Council of the City of Denton, Texas, approves
the attached agreement for the purchase of untreated water from
the City of Dallas
SECTION II
That the Mayor and the City Secretary, respectively, are
authorized to execute and attest the attached agreement
SECTION III
That this ordinance shall become effective immediately upon
its passage and approval
T
PASSED AND APPROVED this the -/pL~ day of ( 1985
CITY OF DENTON, TEXAS
ATTEST
I'M
-on . P
C IOTTE ALLEN, CITY SECRETARY
CITY OF DENTON, TEXAS
APPROVED AS TO LEGAL FORM
DEBRA ADAMI DRAYOVITCH, CITY ATTORNEY
CITY OF DENTON, TEXAS
BY ^ & 7
THE STATE OF TEXAS )
COUNTY OF DALLAS )
UNTREATED WATER PURCHASE CONTRACT
?'4-
THI CONTRACT made and entered into this the day
lee
, 1985, by and between the City of Dallas, Texas,
of _
herei after called Dallas, and the City of Denton, hereinafter
called Denton
WHEREAS, Dallas and Denton presently own certain water rights in
an existing water reservoir, Lewisville Lake, and
WHEREAS, Dallas and Denton have agreed to jointly construct Ray
Roberts Lake, and
WHEREAS, Ray Roberts Lake, when constructed, will be integrally
operated in conjunction with Lewisville Lake, and
WHEREAS, Dallas and Denton desire to agree on operation and
respective yields of Dallas and Denton from Lewisville Lake and Ray
Roberts Lake during and after the filling of Ray Roberts Lake, and,
WHEREAS, Denton s share of the yield in Lewisville Lake and Ray
Roberts Lake may not be adequate to satisfy Denton s requirements
for untreated water, and
WHEREAS, Denton is desirous of purchasing untreated water from
Dallas, and Dallas desires to sell untreated water to Denton as set
forth herein under the terms and conditions herein stated,
NOW, THEREFORE, Dallas and Denton in consideration of the terms,
covenants, and conditions herein contained, hereby agree as follows
W I T N E S S E T H
1 0 WATER SALES
1 1 Dallas agrees to sell to Denton untreated water to meet
requirements of Denton subject to the terms and conditions herein
provided
1 2 The sale of untreated water to meet the requirements of
Denton may be subject to and limited by available system supply
The determination of availability rests with the Director of Dallas
Water Utilities However, such sale shall not be unreasonably
1
withheld and such limitation shall consider only untreated water
supply availability
2 0 GLOSSARY
2 1 Annual Average Draft Total annual withdrawal averaged
over the year Withdrawal limitations refer to annual averages, not
to instantaneous rate
2 2 Conservation Pool Storage Capacity The water storage
capacity between certain lake levels which is designated for water
supply
2 3 Conservation Withdrawals Water released or pumped for
water supply from a surface water reservoir
2 4 Critical Drought The most severe period of water
shortage experienced by Dallas and Denton during the historical
record of hydrologic measurements The Critical Drought of record
as of the signing of this contract occurred from 1950 to 1957
2 5 Existing Lewisville Lake Lewisville Lake prior to the
construction and gate closure of the Ray Roberts Incremental
Project The top of the conservation storage pool is 515 feet mean
sea level (msl)
2 6 Dependable Yield The maximum annual demand that could be
supplied continually every year without shortage from a surface or
ground water resource
2 7 Filling Period The time from completion and gate closure
of the Ray Roberts Incremental Project to when impoundment of water
is sufficient to fill the Project Storage capacity
2 8 MGD million gallons per day
2 9 Overdrafting Withdrawing water at a rate greater than
the dependable yield of the lake
2 10 Project Storage Capacity
defined to be the total storage
conservation pool 632 5 feet msl
799,600 acre feet) and the storage
522 feet msl (estimated initial c
total storage of 977,200 acre feet
The project storage capacity is
in Ray Roberts Lake (top of
- estimated initial capacity
in Lewisville Lake from 515 to
apacity 177,600 acre feet) for
2 11 Ray Roberts Incremental Project A project constructing
Ray Roberts Lake (previously known as Lake Aubrey) in the watershed
of Lewisville Lake The yield of the Ray Roberts Incremental
Project is 76 MGD greater than the existing Lewisville Lake The
2
project provides conservation storage capacity in Ray Roberts Lake
and increases conservation storage capacity in Lewisville Lake
2 12 Sedimentation The gradual settling of soil particles
washed into the lake Over time, this process may reduce the
conservation pool storage
2 13 Water Budget Method A conservation of mass equation
which can be solved for lake inflow For the purpose of this
contract, the equation is
Change in Storage = Inflow + (Precipitation - Evaporation)
x (Lake Surface Area) - Withdrawals - Spills
3 0 DEPENDABLE YIELD SHARES
3 1 Dallas and Denton hold water rights in Lewisville Lake
premised on annual rights to impound and divert water from
Lewisville Lake Water rights have not affixed the diversion
authority based on the dependable yield of Lewisville Lake Dallas
and Denton agree that Dallas' share of the dependable yield of
Lewisville Lake is 95 1835 percent and Denton s share is 4 8165
percent Dallas and Denton agree that these yield shares are
predicated on Denton not withdrawing, as Denton s yield share, more
than 1584 10 million gallons per 365 day year, or 1588 44 million
gallons per 366 day year, exclusive of effluent return consideration,
from the existing Lewisville Lake Provided, however, that if yield
shares are recalculated in accordance with Section 3 4, Denton s
maximum annual withdrawals would be subject to revision based on
such recalculation Denton's share of the dependable yield in terms
of MGD is calculated and listed in Exhibit A, attached to and made a
part of this Contract It is agreed that as of year 1980, the
dependable yield of Lewisville Lake is 90 2 MGD Dependable yield
does not include consideration of effluent return Denton s
authority to withdraw additional untreated water from Lewisville
Lake in consideration of effluent returns is provided by Section
16 2 and Exhibit A of this Contract
3 2 Denton agrees that although Denton has a permit to impound
and divert an additional 255,320 acre feet per annum from Lewisville
Lake and Ray Roberts Lake after Ray Roberts Lake is completed, the
year 2000 incremental dependable yield derived from constructing the
Ray Roberts Incremental Project shall be 76 MGD, and that this yield
shall be divided 26% to Denton (19 76 MGD) and 74% to Dallas (56 24
MGD)
3 3 For purposes of determining the annual amounts of water
for which Denton will make payment to Dallas under this Contract, it
is agreed that Denton's share of the dependable yield of Lewisville
Lake and Ray Roberts Lake and Denton s annual share of the effluent
3
return shall be calculated by rounding dependable yield on a daily
or annual basis to two decimal places
3 4 Recalculation of lake yields shall be accomplished when
A a more severe drought than the Critical Drought of
record occurs in the Lewisville Lake watershed
B either Dallas or Denton believes that changes in the
watershed or lake capacities have resulted in
significantly different lake yields In this event, the
party contending that a change in yield has occurred may,
at its own expense, employ a mutually agreeable consulting
firm to update inflows or lake capacities for yield
recalculations Provided, however, that Denton and Dallas
may agree that Dallas will perform yield recalculations
All lake dependable yield recalculations shall be
determined by the following method
i The dependable yield of Lewisville Lake with top
of conservation level 515 0 feet will be recalculated
as though Ray Roberts Lake did not exist This
calculation establishes the base dependable yield for
the original allocation of water rights in Lewisville
Lake
ii The incremental dependable yield of Ray Roberts
Lake will be recalculated by applying the principles
and methods used to derive initial incremental
dependable yield incorporated into this Contract
The criteria utilized in the initial Ray Roberts Lake
incremental dependable yield determination is
attached as Exhibit G
3 5 During the Ray Roberts Incremental Project Filling Period
Denton and Dallas shall share in the available dependable yield of
the Ray Roberts Incremental Project on the basis of Denton s 26% and
Dallas' 74% The available dependable yield shall be based on the
full project dependable yield of 76 MGD and the highest storage
level previously attained in the project storage The project
storage shall be calculated using year 2000 lake capacities as
follows
A Determine elevation of Lewisville Lake and calculate
storage in Lewisville Lake
B Determine the elevation of Ray Roberts Lake and
calculate storage in Ray Roberts Lake
C The project storage is the sum of A above and B above
less the Lewisville Lake capacity at elevation 515, but in
no case shall the project storage be less than zero
3 6 The largest value of project storage previously attained
shall be used to calculate the available yield as follows
Y = X - 8 44
11,481
Y - the incremental yield in MGD
X the largest project storage volume previously
attained in acre feet
For values of X less than 96,880 acre feet, the value of Y = 0
For values of X greater than 969,500 acre feet, the value of Y =
76
The equation is valid for values of X greater than 96,880 acre
feet and values of X less than 969,500 acre feet
The above relationships are derived based on project storage
being proportional between Ray Roberts Lake and Lewisville Lake
Exhibit B is a graphical representation of the above equation The
current project storage volume shall be determined on the first work
day of each month
4 0 OVERDRAFTING
4 1 Denton acknowledges that overdrafting of the Elm Fork by
Dallas is premised on Dallas having a multiple reservoir system and
that when Dallas overdrafts a reservoir, there is a commensurate
underdraft of other reservoirs
4 2 During the Ray Roberts Incremental Project filling period,
Dallas shall not overdraft on an annual basis from Lewisville Lake
or Ray Roberts Lake in amounts greater than it would have if Ray
Roberts Lake had not been constructed
4 3 Dallas shall not overdraft the Ray Roberts Incremental
Project and Lewisville Lake to the extent that Denton s dependable
yield is diminished
4 4 Denton does not, at the effective date of this contract,
have a multiple system of reservoirs However, Denton does own and
operate water wells of sufficient yield which can be used as an
alternate source of water supply in the event of a Critical Drought
and may in the future acquire other surface water resources which
5
can be utilized as alternative sources for purposes of overdrafting
Dallas and Denton agree that Denton may overdraft the Ray
Roberts Incremental Project when the incremental Ray Roberts storage
is more than half full The incremental Ray Roberts storage is
calculated by determining the storage that would have been in the
existing Lewisville Lake and subtracting this amount from the
current total two lake (Lewisville and Ray Roberts) storage The
methodology for calculating the storage that would have been in
existing Lewisville Lake is outlined in Exhibit H
Denton shall underdraft when the Ray Roberts Incremental Project
is less than half full The amount of the Denton draft when the Ray
Roberts Incremental Project is below half full is to be determined
by calculating the average amount of Denton draft from the time the
storage was full until it reaches half empty, (excluding previous
periods when below half full) and entering the graph contained in
Exhibit H with this amount and reading the Denton draft below half
full on the axis
Provided, however, that Denton will have an independent
consultant provide a study to validate the dependable yield of
Denton's alternative water resources including surface supplies and
the water wells that are to be drafted, in lieu of the Ray Roberts
Incremental Project, when the Ray Roberts Incremental Project is
below half full Dallas will be provided with a copy of studies
validating the dependable yield The initial study findings shall
be validated at ten year intervals
In no event shall Dallas be obligated to supply Denton with
additional untreated water where Denton s additional requirements
arise from inadequate planning of Denton s overdraft or failure of
Denton s water wells to produce adequate volume to compensate for
diminished yield resulting from Denton being required to underdraft
the Ray Roberts Incremental Project when less than half full
5 0 DEMAND CHANGES IN DEMAND
5 1 'Demand' means the maximum average annual amount of
untreated water, expressed in MGD, to be withdrawn by Denton from
Dallas' rights within a Water Year Water Year means the year
beginning June 1 and ending May 31 Exhibit C is Denton s projected
water usage and demand for untreated water on which this Contract is
based
5 2 Denton shall give annual notice in writing to Dallas of
Denton's demand for untreated water for the coming water year by
submitting a revised Exhibit C Such notice shall be given at least
ninety days in advance The Director of Water Utilities of Dallas
may waive the ninety day notice requirement for good cause shown
6
5 3 In the event Denton withdraws more than the agreed demand
for untreated water from Dallas' rights in a water year as listed on
the annually revised Exhibit C, Denton agrees to pay for such
additional water at the same rate per 1000 gallons as established in
provision 10 of this contract
5 4 During the term of this Contract, Denton s demand from
Dallas in any water year shall not be less than the highest demand
in any previous water year, effective at the beginning of the Water
Year, following the availability to Denton of at least 10 3 MGD of
water for its withdrawal from the Ray Roberts Incremental Project
Provided, however, that when Denton exercises its options with the
U S Government for the additional increments of their right from
the Ray Roberts Incremental Project, it shall be recognized that
Denton s demand for water purchased from Dallas under this Contract
will potentially drop to zero In that event, the condition
providing that Denton s demand shall not be less than the highest
demand in any previous water year shall not be effective as to the
additional increments until Denton's water purchases under this
Contract exceed 1 0 MGD Denton shall notify Dallas in writing when
it decides to exercise its option for any additional increments
5 5 Denton agrees that Dallas' capability to provide increases
in demand is subject to available supply of untreated water The
determination of availability rests with the Director of Dallas
Water Utilities However, providing additional supply shall not be
unreasonably withheld
6 0 DIVERSION POINT, METERING, ETC
6 1 Dallas agrees to sell untreated water contracted for by
Denton at diversion point(s) as delineated in Exhibit D attached
hereto and at such additional points as may be mutually agreed upon
by both parties Dallas acknowledges the acceptability of the
current Denton metering facility at Lewisville Lake The cost of
all maintenance or reconditioning of the existing metering facilty
and all future metering facilities, whether delineated in Exhibit D
hereof or mutually agreed upon at a later date, shall be borne by
Denton Unless otherwise mutually agreed to by Dallas and Denton,
Denton shall be responsible for the design, contracting,
construction and financing of metering facilities All designs,
materials and specifications shall be mutually agreed to by Dallas
and Denton Plans shall be submitted to Dallas for review and
comment All metering and diversion facilities shall be designed,
constructed and operated in accordance with standard industry
practices Meters shall conform to American Waterworks Association
Standards, where such standards exist Denton agrees that Dallas
has the right to make periodic inspections during the construction
7
phase of the metering facilities Final approval of completed
metering facilities is subject to the mutual agreement of Denton and
Dallas
6 2 Denton agrees to provide ingress and egress for Dallas
employees and agents to inspect and test metering facilities owned
by Denton
6 3 Denton will be responsible to insure each meter will be
operated and maintained so as to record with commercial accuracy
Denton shall employ a professional meter testing firm, acceptable to
Dallas, to test such meters annually and shall invite
representatives of Dallas to observe such tests Dallas has the
right to request a meter to be tested The cost of such requested
test shall be borne by Dallas if the test reveals the meter was
operating within manufacturer s specifications for accuracy
7 0 BOOKS AND RECORDS
7 1 Dallas agrees that Denton or its agent may have access to
the books and records of Dallas Water Utilities at reasonable
times Denton agrees that Dallas or its agent may have access to
the books and records applicable to Denton s Water Utilities at
reasonable times
8 0 ADDITIONAL SURFACE WATER SUPPLIES
8 1 If Denton develops or acquires additional surface water
supplies other than Ray Roberts Lake and Lewisville Lake from any
source other than Dallas, resulting in reduced demand from Dallas,
then Dallas is released from the obligation to supply the demand
amount determined according to provision 5 0 In such event Dallas
may adjust its supply obligation to levels commensurate with
Denton s reduced demand
8 2 If within the term of this Contract Denton ceases to take
water from Dallas because such other surface water supplies have
been developed or acquired, Denton may, at the option of Dallas, for
five years from date of notification by Denton of intent to reduce
or cease taking water, or the balance of this Contract, whichever is
less, remain liable for charges at the most recent annual billing
level in effect at such cessation Dallas shall consider whether a
direct or indirect liability has been incurred on Denton s behalf in
determining whether to hold Denton liable for charges
9 0 RESALE
9 1 Denton agrees not to sell water purchased from Dallas to
8
any person or entity outside Denton s current water service area or
areas for which the State of Texas Public Utilities Commission has
issued Denton a "Certificate of Convenience and Necessity , as may
be adjusted from time to time, unless Denton has received prior
written approval from the Director of Water Utilities of Dallas At
the effective date of this Contract, Denton's water service area
includes Denton, Argyle, Corinth, Hickory Creek, and Shady Shores
In granting such authorization, Dallas may establish the terms
and conditions of the conveyance of such water including, but not
restricted to, the setting of monetary rates for sale of such
water Such control over terms, conditions and rates by Dallas
shall not be unreasonable and shall relate primarily to the
untreated water component of such sales Convey means sell,
trade, donate, exchange, transfer title, or contract therefor
Dallas agrees not to sell treated or untreated water to customers in
Denton s service area without approval from Denton
10 0 RATES AND PAYMENT
10 1 Rates charged Denton shall be established by ordinance of
Dallas
10 2 Denton understands that Dallas City Council has the right
by ordinance to revise the rates charged, from time to time as
needed, to cover all reasonable, actual and expected costs The
Director of Water Utilities of Dallas will furnish Denton a draft
copy of the Cost of Service Study for proposed rates thirty (30)
days prior to submitting a rate increase request to the City Council
of Dallas Any revision of rates shall be pursuant to principles
set forth in Exhibit E, attached hereto and made a part of this
Contract Any revision of Exhibit E, according to its terms and not
in conflict herewith, shall automatically be incorporated and become
a part of the contract Dallas shall give Denton a minimum of six
months notice of intent to revise rates
10 3 Denton agrees to provide Dallas with comments, if any, in
regard to the cost of service study within twenty (20) days after
receipt
10 4 Denton agrees to give Dallas a minimum of thirty (30) days
notice of intent to protest rates or any other condition of
service Provided, however, that Denton is not required to give 30
day notice of intent to appear before Dallas City Council to protest
cost of service studies
10 5 Denton shall pay Dallas for water withdrawals in excess of
the sum of Denton's
(A) dependable yield share of Lewisville Lake and the Ray
Roberts Incremental Project,
9
(B) share of effluent returns to Lewisville (4 8165%) and
Ray Roberts Lakes (26%), but see Exhibit A pertaining
to calculation of Gainesville effluent returns, and
(C) overdraft of Lake Ray Roberts
10 6 Dallas agrees to render a statement of charges monthly
Payment is due upon receipt of statement Denton agrees to pay
within fifteen (15) days of receipt of statement
10 7 In the event a meter is discovered malfunctioning, then
the amount of water that has passed through the meter will be
estimated for each day the meter has not functioned correctly The
last correctly measured monthly consumption will be used as a basis
for mutually calculating the amount of water delivered to Denton
during the time the meter has not been functioning correctly
11 0 READINESS TO SERVE
11 1 When the Ray Roberts Incremental Project has filled
sufficiently for Denton to begin withdrawals from their share of the
Incremental Project, Denton's purchases of untreated water from
Dallas are expected to gradually diminish These withdrawals are
anticipated to occur in 1987, but the actual date will vary,
depending upon construction schedules and weather conditions
11 2 In 1990, it is anticipated Denton will have sufficient
untreated water available from their combined rights in Lake
Lewisville and Lake Ray Roberts to meet Denton s normal water
requirements If so, Denton may not need to purchase any untreated
water from Dallas in those years when Denton s demand can be
satisfied from Denton s own untreated water rights
However, due to unusual weather, ultimate population growth or
other unanticipated conditions, Denton may need to purchase from
time to time supplemental untreated water from Dallas Due to this
potential need, Denton desires for Dallas to maintain sufficient
reservoir capacity so as to be ready to meet Denton s demands for
untreated water in the years that Denton s untreated water rights
are not adequate to meet Denton s needs
11 3 In consideration of Dallas agreement to obligate
reservoir capacity to meet Denton s potential, varying demands for
untreated water, Denton agrees to compensate Dallas for its cost in
providing capacity on a readiness to serve basis, as provided in
Paragraph 11 4
11 4 The charge for readiness to serve shall be based on
Denton s expressed average annual demand for untreated water
purchases from Dallas, as established by provision 5 0, its actual
purchases from Dallas, or 5 MGD, whichever is greater Provided,
10
however, that Dallas shall not be obligated to supply more than 2
times the amount of water which Denton has purchased from Dallas in
the first of the five years preceding
11 4 1 The readiness to serve charge shall become effective
at the beginning of the water year following Denton's initial
withdrawal from the Ray Roberts Incremental Project
11 5 The annual readiness to serve charge shall be prorated
over 12 months and billed monthly
11 6 In the event Denton is required to pay for a greater
quantity of water than is actually withdrawn from Dallas rights,
the difference between the quantity actually withdrawn and the
quantity that Denton is obligated to pay for under provision 11 0
shall be billed at the prevailing ordinance rate minus a year-end
credit that excludes the variable costs included in the prevailing
ordinance rate
12 0 CURTAILMENT
12 1 Denton agrees that if water supplies are curtailed within
Dallas, Dallas may impose a like curtailment on deliveries of water
under this contract to Denton Such curtailments shall be limited
to the extent that such supplies and service are curtailed due to
untreated water supply availability and giving recognition to the
fact that Denton diverts water from Lewisville Lake and Ray Roberts
Lake and supplies and provides all of its own untreated water
transportation Denton will cooperate by imposing conservation
measures upon its sales
12 2 Dallas and Denton agree to develop water conservation
plans which incorporate loss reduction measures and demand
management practices designed to insure that the available supply is
used in an economically efficient and environmentally sensitive
manner Upon request, Dallas or Denton will furnish a copy of its
conservation plan to each other
12 3 To the extent Dallas imposes restrictions or grants
privileges of general applicability to itself and customer cities,
including rules relating to the curtailment of water delivery and
availability, Dallas agrees to impose such restrictions and grant
such privileges equitably and in a non-discriminatory fashion Such
restrictions or privileges shall take into consideration Denton s
ownership of water rights and untreated water diversion and
transmission facilities
13 0 OPERATIONAL AGREEMENT
13 1 An Operational Agreement between Dallas and Denton for
operation of Ray Roberts Lake and Lewisville Lake, attached hereto
11
and marked Exhibit F, is made a part of this Contract Any revision
of the Operational Agreement, according to its terms and not in
conflict herewith, shall automatically be incorporated and become a
part of this Contract
13 2 Denton agrees to be bound by any amendment to the
Operational Agreement if it is a signatory to such amendment
14 0 FORCE MAJEURE INDEMNITY REMEDIES, NO WARRANTIES
14 1 If, for any reason, not reasonably within the control of
the party so claiming, either party hereto shall be rendered in
whole or in part unable to carry out its obligations under this
Contract, then that party's obligation shall be suspended during the
continuance of the inability then claimed, but for no longer
period Such party shall endeavor to remove or overcome such
inability with all reasonable dispatch
14 2 Dallas makes no representation or warranty, express or
implied, as to the character, quality or availability of the water
to be taken and Purchaser agrees to assume all such risks, accepting
said water, if available, in the same state as it is pumped from the
designated diversion points, nor does Dallas make any representation
that such water will be suitable for the purposes for which
Purchaser desires to use it Dallas shall not be liable in any
event for the nonavailability of water hereunder, the unsuitability
of such water or its quality, or the inability of Dallas to perform
any obligation under this Contract for reasons beyond its control,
including rules or regulations of other governmental agencies
14 3 Denton agrees to defend, indemnify and hold Dallas whole
and harmless from any act or omission of any representative, agent,
customer, employee, and/or invitee of Denton, and to defend and hold
Dallas whole and harmless against any and all claims for damages,
costs, and expenses that may arise out of, or be occasioned by this
Contract to any of its activities unless said damages result from
the negligence of Dallas Except for those things described and
disclaimed in Paragraph 14 2, which are expressly excluded from this
indemnity, Dallas agrees to defend, indemnify and hold Denton whole
and harmless from any and all claims for damages, costs and expenses
occasioned by any negligent act or omission of any representative,
agent or employee of Dallas arising solely out of the operation of
any facilities owned by Dallas and used under this Contract, unless
said damages result from the negligence of Denton
14 4 Recognizing that Dallas and Denton's undertaking as
provided in this Contract are obligations, the failure in the
performance of which cannot be adequately compensated in money
damages, Dallas and Denton agree that, in the event of any default,
12
the other party shall have available to it the equitable remedy of
specific performance in addition to other legal or equitable
remedies which may be available to such party
15 0 WATER WELLS
15 1 Nothing in this Contract shall be construed to impair or
affect Denton s right to use its existing water wells or any water
wells it may drill in the future
16 0 SEWAGE TREATMENT FACILITIES
16 1 Denton agrees to maintain adequate sewage treatment
facilities to meet its needs and provide for any increased quantity
of wastewater flow
17 0 EFFLUENT RETURNS
17 1 Treated effluent returns to Lewisville Lake and Ray
Roberts Lake are not considered in determining the dependable yield
of Lewisville Lake or Ray Roberts Lake Dallas, however, recognizes
the existence of effluent returns and acknowledges Denton s right to
share in increased untreated water availability attributable to
effluent returns, provided Federal, State or other governmental
agencies do not appropriate or otherwise restrict the use of
effluent returns As of year 1980 until the beginning of the first
water year following the effective date of this Contract, Denton may
include 2 MGD as their share of untreated water available as a
result of effluent returns to Lewisville Lake Shares of effluent
returns following the beginning of the first water year after the
effective date of this contract shall be determined or redetermined
under conditions specified in Exhibit A
18 0 SALE OF SHARES IN PROJECT
18 1 Denton and Dallas agree that neither party shall sell
their percentage share, or any part thereof, in the Ray Roberts
Incremental Project to any other municipality, corporation public or
private, partnership, association, person or other entity, without
first giving the other party the right to purchase such conservation
storage in said reservoir at the original offered price, provided
that the offer presented to Denton is a firm offer to purchase in
writing
13
19 0 SPECIAL PROVISIONS
19 1 Special provisions applicable to this Contract are
attached hereto and styled Exhibits A through H These Exhibits are
incorporated herein, as if copied word for word
Exhibit A delineates Denton's yield and effluent return from
Lewisville Lake as of 1980
Exhibit B delineates the available yield of the Ray Roberts
Incremental Project during the filling period
Exhibit C is Denton s Projected Untreated Water Usage on which
the sales portion of this contract is based
Exhibit D delineates Denton's diversion point
Exhibit E is the Wholesale Untreated Water Rate Principles
Exhibit F is the Operational Agreement Between Dallas and
Denton for Lewisville Lake and Ray Roberts Lake
Exhibit G is the Reservoir Yield Criteria used in the Ray
Roberts Lake incremental yield determination which
will also be used in yield recalculations
Exhibit H is the graph and calculation procedures which
determine Denton's draft of the Ray Roberts
Incremental Project when half empty
20 0 TERM
20 1 This Contract shall remain in force and effect for a
period of 30 years from the date of execution of the Contract
Provided, however, Denton may terminate this Contract if Denton
develops additional surface water supplies and ceases to take water
from Dallas subject to provision 8 0, in which event Denton may be
liable to Dallas in accordance with provision 8 0
21 0 VENUE
21 1 The parties herein agree that this Contract shall be
enforceable in Dallas, Texas, and if legal action is necessary to
enforce it, exclusive venue shall lie in Dallas County, Texas
14
22 0 NO VERBAL AGREEMENT
22 1 This Contract contains all commitments and agreements of
the parties hereto and no verbal or written commitments shall have
any force or effect if not contained herein
23 0 APPLICABLE LAWS
23 1 This Contract is made subject to all applicable laws of
the State of Texas and the United States
24 0 CONTRACT INTERPRETATION
24 1 In interpreting the various provisions of this Contract in
a Court of Law, any said court having jurisdiction shall apply the
laws of the State of Texas to interpret the terms and provisions of
this Contract
25 0 CAPTIONS
25 1 The captions to the various clauses of this Contract are
for informational purposes only and shall not alter the substance of
the terms and conditions of this Contract
26 0 NOTICES
26 1 Any notice required under this Contract shall be given to
the respective parties at the following addresses by Certified Mail,
postage prepaid
Denton
City of Denton, Texas
Attn City Manager
215 E McKinney
Denton, Texas 76201
Dallas
City of Dallas, Texas
Attn City Manager
City Hall, 1500 Marilla
Dallas, Texas 75201
EXECUTED as of the day of , 1985, on
behalf of the City of Dallas by its City Manager, duly authorized by
City Council Resolution No 85- , adopted on
1985, and countersigned by its City Controller, attested by its City
15
Secretary, and approved as to form by its City Attorney, and on
behalf of the City of Denton, by its duly authorized officials
APPROVED AS TO FORM CITY OF DALLAS
ANALESLIE MUNCY, City Attorney CHARLES S ANDERSON, City Manager
By By
Assistant City Attorney
Submitted to City Attorgay
Assistant City Manager
CITY OF DENTON
ATTEST
City Secretary
APPROVED AS TO FORM
By 9? " 6
Assistant City Attorney
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By
16
EXHIBIT A
Calculation of Denton's Share of Effluent Returns
A Formula
Percentage Share of Dependable Yield
X Effluent Returns to Lewisville or Ray Roberts Lake (MGD) (2)
= MGD Share of Effluent Return in Lewisville or Ray Roberts Lake
(')Percentage shares of dependable yield are delineated in
conditions 3 1 for Lewisville Lake (4 8165%) and 3 2 for Ray
Roberts Lake (26%)
(')Effluent returns at the effective date of this contract
shall be returns of the cities of Denton and Gainesville
Shares of the Gainesville effluent return shall be based on
1 the average annual level of Gainesville contribution for
the three most recent years (October thru September)
effective at the end of September in the first year of gate
closure of Ray Roberts Lake shall be multiplied by the
Lewisville Lake yield share This number, once
established, shall be a constant for the calculation
2 the level of Gainesville contribution during the October
through September period of years following Ray Roberts
Lake gate closure minus the constant calculated in 1 above
times the Ray Roberts Lake yield share shall be added to 1
to determine the total of Denton s share of Gainesville
effluent return
In the future other cities having a wastewater discharge in
excess of 5 MGD will be included for the purpose of this
calculation provided the discharge can be validated as
contributing to water availability from Lewisville Lake or Ray
Roberts Lake commensurate with the recorded discharge
B Conditions of Calculation
All effluent returns shall be considered to be to Lewisville
Lake until the beginning of the water year following Denton s
commencement of withdrawal of its share of available yield from
the Ray Roberts Incremental Project
If wastewater discharges for cities other than Denton and
Gainesville are included in the effluent consideration, they
shall be calculated as being in consideration for return to
either Lake Ray Roberts or Lake Lewisville based on the
watershed areas for the appropriate reservoir
A-1
Effluent return data shall be obtained from reports submitted by
the cities to the Texas Department of Water Resources
Calculation of the annual consideration shall be based on the
October thru September reports
048165 X *4 7 = 23 MGD
2 Lewisville Lake + Ray Roberts Lake
Constant = 07 MGD
048165 X **l 7 08 MGD
26 X ***l 2 31 MGD
46 MGD
(*Denton and Gainesville Discharge to Lewisville Lake)
(**Denton Discharge to Lewisville Lake)
(***Gainesville Incremental Discharge after Ray Roberts Gate Closure)
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A-2
1 Lewisville Lake (Prior to Ray Roberts Gate Closure)
EXHIBIT B
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EXHIBIT C
DENTON'S PROJECTED WATER USE AND DEMAND
DENTON
RA
Y
LEWIS-
EFFLUENT
SUPPLY
TOTAL
YEAR
ROBERTS
VILLE
RETURN
TOTAL
DALLAS
REQMT
YEAR
1985
0
4
3
5
4
8
5
5
10
3
1985
1986
0
4
3
5
4
8
6
0
10
8
1985
1987
0
4
3
5
4
8
6
5
11
3
1987
1988
5
0
4
3
6
9
9
1
9
11
8
1988
1989
10
3
4
3
6
15
2
0
12
3
1989
1990
10
3
4
3
6
15
2
0
12
9
1990
1991
10
3
4
3
6
15
2
0
13
5
1991
1992
10
3
4
3
6
15
2
0
14
1
1992
1993
10
3
4
3
7
15
3
0
14
8
1993
1994
10
4
4
3
7
15
3
0
15
4
1994
1995
11
1
4
3
7
15
3
0
16
1
1995
1996
11
8
4
3
8
15
4
0
16
9
1996
1997
12
6
4
3
8
15
4
0
17
7
1997
1998
19
8
4
3
8
24
9
0
18
5
1998
1999
19
8
4
3
9
25
0
0
19
3
1999
2000
19
8
4
3
9
25
0
0
20
2
2000
2001
19
8
4
3
1
0
25
1
0
21
2
2001
2002
19
8
4
3
1
0
25
1
0
22
1
2002
2003
19
8
4
3
1
1
25
2
0
23
1
2003
2004
19
8
4
3
1
1
25
2
0
24
2
2004
2005
19
8
4
3
1
2
25
3
0
25
3
2005
2006
19
8
4
3
1
2
25
3
1
2
26
5
2006
2007
19
8
4
3
1
3
25
4
2
3
27
7
2007
2008
19
8
4
3
1
3
25
4
3
6
29
0
2008
2009
19
8
4
3
1
4
25
5
4
8
30
3
2009
2010
19
8
4
3
1
5
25
6
6
1
31
7
2010
2011
19
8
4
3
1
6
25
7
7
5
33
2
2011
2012
19
8
4
3
1
7
25
8
8
9
34
7
2012
2013
19
8
4
3
1
7
25
8
10
5
36
3
2013
2014
19
8
4
3
1
8
25
9
12
1
38
0
2014
2015
19
8
4
3
1
8
26
0
13
7
39
7
2015
YEAR 1985
(To be revised each water year in accordance with provision 5 2)
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EXHIBIT 8
1, Viciaitf Mp of Diversion. Point
2 Denton anticipates at some time in the future locating a diversion point on
Ray Roberts Lake At such time as the actual location of the proposed diversion
point is known, this Exhibit C shall be modified
EXHIBIT E
WHOLESALE UNTREATED WATER RATE PRINCIPLES
1 Key Rate Setting Principles
a Revenue requirements are to be determined on the utility
basis, at original cost
b Rate of Return - Embedded rate of interest on water
obligations plus 1 5%
c Reservoirs - All existing and future reservoirs in a common
rate base with untreated water customers as a class paying their
proportionate share of costs for reservoir storage, including a
portion held for future use Costs allocated to untreated water
customers shall be adjusted from time to time according to
changes in actual usage
d Untreated Water Transmission - Allocation of costs between
untreated water customers and treated water customers based on
test period usage
e Other Administration - Allocated on the basis of the above
allocations
f Rate Design - One-part rate (volume)
2 Cost-of-Service Studies
Cost-of-Service studies to establish wholesale untreated water
rates shall be conducted by Dallas Such studies will be conducted
in conformity with standard utility rate-making practices and
subject to review, but not approval of, a rate subcommittee composed
of designated members from the wholesale water customers of the City
of Dallas At least one member of the subcommittee shall be from an
untreated water customer city
EXHIBIT F
OPERATIONAL AGREEMENT BETWEEN DALLAS AND DENTON
FOR LEWISVILLE LAKE AND RAY ROBERTS LAKE
1 Purpose
The purpose of this agreement is to provide a basis for the
joint operation by Dallas and Denton of Lewisville Lake and Ray
Roberts Lake
2 Water Supply Releases
Dallas and Denton agree that Dallas shall act as spokesman for
Dallas and Denton to the Corps of Engineers, in behalf of both
Dallas and Denton, in requesting all water supply releases from
Ray Roberts Lake and Lewisville Lake Ten days after written
notice to Dallas and the Corps of Engineers, Denton may assume
the role of spokesman for Denton s share of water supply
releases and management of its storage in Ray Roberts and
Lewisville Lake
Releases made from Ray Roberts Lake in accordance with the
minimum release schedule in the Memorandum of Agreement between
Dallas, Denton and the United States of America shall be shared
proportionately between Dallas (74%) and Denton (26%)
When Dallas is operating the reservoir and acting as spokesman
to the Corps of Engineers in behalf of Denton, Denton shall
advise Dallas weekly of water releases to be made in Denton s
behalf
Dallas recognizes that Denton plans to install hydroelectric
generating units on Lewisville Lake and Ray Roberts Lake and
agrees to give consideration in making water releases from the
reservoirs for beneficial use of the hydroelectric units
Dallas and Denton shall formulate conditions for water releases
from the reservoirs that accommodate Denton s need for water for
hydroelectric generation and conditions pertaining to
compensation for any value realized in utilizing water flows
from Lewisville and Ray Roberts Lakes for the purpose of
generating electric power by a separate document However,
primary consideration in operating the reservoirs and scheduling
water releases from the reservoirs shall be maximization of
dependable yield, conservation of water and efficient operation
of the reservoirs
F - 1
3
Withdrawals
Denton agrees to withdraw from Lewisville Lake on an annual
average basis, an amount at least equal to Denton s dependable
yield share of the existing Lewisville Lake plus 18% of Denton s
dependable yield share of the Ray Roberts Incremental Project,
providing Denton's requirements for water are sufficient to
require such withdrawals Dallas and Denton agree that they
shall operate Lewisville Lake and Ray Roberts Lake as a
reservoir system and, during the filling period of the Ray
Roberts Incremental Project, Dallas withdrawals from this system
shall be limited to the withdrawals Dallas would have made if
the Ray Roberts project had not been built The Dallas schedule
for withdrawals from existing Lewisville Lake is specified in
the Dallas Reservoir Operations Guidelines During the filling
period of the Ray Roberts Incremental Project, Dallas' maximum
release will be based on what the level of Lewisville Lake would
have been if Ray Roberts Lake had not been built This level
will be determined by hydrologic study
After the filling period of the Ray Roberts Incremental Project,
Dallas shall be allowed to overdraft Lewisville Lake and Ray
Roberts Lake Dallas agrees that Lewisville Lake and Ray
Roberts Lake shall be operated such that Denton will be able to
withdraw its share of the dependable yield of Lewisville Lake
and Ray Roberts Lake and its water demand from Dallas,
estabished according to provision 5 0, throughout a Critical
Drought period
4
Water Quality
Each city agrees to strive to prevent a degradation in water
quality in Lewisville Lake and Ray Roberts Lake resulting from
that city s actions
Dallas and Denton agree that they will not divert water from
other sources into Lewisville Lake or Ray Roberts unless Dallas
and Denton mutually agree to the proposed diversion Such
agreement shall not be unreasonably withheld
5
Joint Operating Committee
A joint operating committee consisting of representatives from
Dallas, Denton and Lewisville shall be organized for the purpose
of periodically meeting to discuss and, if necessary, formulate
conditions of operation for the Lewisville and Ray Roberts
reservoirs
F - 2
Meetings shall normally be convened semi-annually during the
months of March and September
Denton shall be represented by its City Manager and/or Director
of Utilities
Dallas shall be represented by its Director of Water Utilities
or his designated representative
Lewisville shall be represented by its City Manager and/or
Superintendent of Water Production and Wastewater
6 Approved Changes
Changes in this Operational Agreement may be made by mutual
agreement in writing of Dallas and Denton at any time
F - 3
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FOR CALCULATING THE INCREMENTAL RAY ROBERTS LAKE YIELD
This Exhibit G provides the initial methodology for calculating a
yield approximating 76 MGD to be used as a starting point for any
future recalculations of yield due to a drought more severe than the
Critical Drought of record or due to changing conditions within the
lakes or watershed The following methodology calculates a yield of
75 7 MGD, which is considered close enough for recalculation
purposes Any future recalculated yield will be multiplied by the
factor 1 00396 to correct for the discrepancy
Guidelines for Yield Calculations
I Calculations involve determining the additional yield derived
from the existing Lewisville Lake (Lewisville with conservation
top at 515 feet) by adding the incremental storage of the Ray
Roberts Lake Project These calculations will involve only
Lewisville and Ray Roberts Lake without regard to the Dallas
system
II The initial part of the calculation is a routing of the existing
Lewisville Lake throughout the Critical Drought of record
(October 1950 to April 1957) as outlined below
A The hydrological data for year 2000 conditions which were
used as a basis for the Financial Feasibility Study for
Aubrey Reservoir' routings will be used These data are
published in the Long Range Water Supply Study for the City
of Dallasz, except that (1) inflows will be modified to
represent year 2000 conditions by averaging the year 1980
and year 2050 inflows, and (2) lake capacity tables will be
modified to represent year 2000 conditions by interpolating
between 1980 and 2050 capacities The computer program
data used in the Financial Feasibility Study for Aubrey
Reservoir has been provided to Denton and is permanently
filed by Dallas with the feasibility study
B Return flows and lowest usable lake levels will be the same
as those used in the Financial Feasibility Study for Aubrey
Reservoir
C Lewisville will be drafted at the overdraft rates specified
in the preliminary 1983 DWU reservoir operation guidelines,
attached hereto, except that the top level of overdraft
(178 8 MGD for Dallas plus 14 6 MGD for Denton and
Lewisville) will be continued until the storage is 25%
depleted (509 6 feet) and the second level of overdraft
(118 0 MGD for Dallas plus 14 6 MGD for Denton and
Lewisville) will be continued from 25% depleted
to 50% depleted (502 3 feet) Below 50% depleted, the lake will
be drafted at its remaining dependable yield (the maximum rate
which can be sustained by the remaining Lewisville Lake pool
until the end of the drought) Annual drafts will be
distributed to months by the monthly demand factors used in the
Financial Feasibility Study for Aubrey Reservoir routings
III The second part of the calculation will be a Critical Drought
(October 1950 to April 1957) routing of enlarged Lewisville Lake and
Ray Roberts Lake The year 2000 hydrologic data used in the
Financial Feasibility Study for Aubrey Reservoir routings will also
be used for this routing The specifics are outlined below
A Ray Roberts Lake will be drafted at an annual average rate
of 85 MGD until the conservation storage becomes two-thirds
depleted Thereafter, it will be drafted at its remaining
dependable yield
B The Ray Roberts Lake draft will be added to the inflow to
the new Lewisville Lake
C The drafts taken from the existing Lewisville Lake in the
routing described under II above will be taken from the new
Lewisville Lake in this routing
D The additional yield which can be supplied throughout the
drought by the new Lewisville Lake will be calculated as part of
this routing and will represent the incremental yield of the
incremental Ray Roberts Lake Project
'Final Report - Financial Feasibility Study for Aubrey Reservoir -
For the Cities of Dallas and Denton, Texas, LWFW, Inc January 1980
2Report on Long Range Water Supply Study to Meet Anticipated
Requirements to the Year 2050 for the City of Dallas, Texas,
URS/Forrest and Cotton, Inc , March 1975
Attachment 1
EXHIBIT G
PRELIMINARY 1983
DALLAS WATER UTILITIES - RESERVOIR OPERATION GUIDELINES
Based on current reservoir conditions and keeping in mind that these
guidelines are flexible and that emergency, water quality, or
maintenance requirements may dictate other operations, the reservoir
system will be operated at least cost within the following general
guidelines
ELM FORK FLOOD WATER
Whenever flood water is available in the Elm Fork, use to the
maximum extent possible
FRAZIER DAM
Water loss over Frazier dam should be minimized The
operational target elevation should be one foot below the weer
crest at 407 0 feet
LAKE GRAPEVINE
Above elevation 531 5 - Considering external restraints, use as
required, up to annual average of 22 MGD for Dallas
Between elevation 531 5 and 528 - While between these limits
restrict to annual average of 14 MGD for Dallas, external
restraints allowing
Below elevation 528 - Restrict to annual average of 7 MGD for
Dallas, external restraints allowing
LAKE LEWISVILLE
Above 512 - Considering external restraints, use as required, up
to annual average of 179 MGD for Dallas
Between elevation 512 and 509 - While between these limits,
restrict withdrawal to 118 MGD annual average for Dallas,
external restraints allowing
Below elevation 509 - Restrict withdrawal to a MGD annual
average necessary to supply system demands, after maximum
utilization of East Side Water, external restraints allowing
LAKE HUBBARD
Above elevation 433 5 - Considering external restraints,
maximize usage up to annual average of 80 MGD
Between elevation 433 5 and 432 0 - Take East Complex system
needs as required from Hubbard up to 80 MGD, after taking at
least 80 MGD from Tawakoni
Below elevation 432 0 - Draft as required to supply the needs of
the East Side Complex after Lake Tawakoni has been drafted at
annual average of 135 MGD
LAKE TAWAKONI
Use as required, up to a maximum annual average of 164 8 MGD
These guidelines are based on a projected annual average water
demand of 264 MGD and a hydrological sequence from 1920-76 The
above incorporates the Dallas City Council Action of May 15,
1979
These guidelines will be revised and superseded as conditions
warrant
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F
EXHIBIT H
DENTON OVERDRAFT OF RAY ROBERTS INCREMENTAL PROJECT
60
50
40
m
z
30
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6 3v.
G7
oZ
F
W
c 20
%
10
C 1
0
5 10 15 20 25
DENTON DRAFT IN BOTTOM HALF
(MGD)
CRAfK `OLTR0D0L06a
L Study 2 (Aubrey Feasibility
3 The remaining yield after the
Study) LawtsvtLls and Ray
storage is Lees than half full
Roberts simulations were used
is calculated
2 An additional draft was im-
4 The reduction to yield during
posed on Lewisville and Ray
the critical drought is sub-
Roberts while the Ray Roberts
reacted from Denton's yield
incremeatal storage was above
half full (Incremental stor-
3 The remaining amount is the
age is the total $corals in
maximum draft Denton is an-
the two lakes minus the star-
titled when incremental stor-
age that would have been in
age is less than half full
Lewisville if Ray Roberts
had not been built )
10
(Exhibit H - Page 2 of 2)
1 Using the Water Budget Method, calculate the inflows into Ray
Roberts Lake and Lewisville Lake for each month since the two
lakes were simultaneously full
2 Starting with the simultaneously full month, begin monthly
simulations of the existing Lewisville Lake storage without Ray
Roberts Lake with the following reservoir gains and losses
A Inflows will be the sum of Lewisville and Ray Roberts
inflows calculated in 1 above
B Withdrawals will be the Dallas withdrawals plus (i) Dallas
untreated water sales and (ii) Denton s yield for
Lewisville Lake as determined under guidelines in exhibit A
C Precipitation will be the best available precipitation for
the lake surface
D Evaporation will be estimated from the Grapevine Dam
evaporation pan
3 Continue calculations in 2 above until the month in question is
reached
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