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2001-371AN ORDINANCE OF THE CITY OF DENTON, TEXAS APPROVING A WHOLESALE WASTEWATER TREATMENT SERVICES CONTRACT BETWEEN THE CITY OF DENTON, TEXAS AND THE LAKE CITIES MUNICIPAL UTILITY AUTI':[ORITY ("LCMUA"), WHEREIN DENTON AGREES TO PROVIDE WHOLESALE WASTEWATER TREATMENT SERVICES TO LCMUA, AUTHORIZING THE CITY MANAGER TO EXECUTE SAID CONTRACT, AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR, AND PROVIDING AN EFFECTIVE DATE THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION 1 That the City Manager ~s hereby authorized to execute on behalf of the C~ty, a Wholesale Wastewater Treatment Serwces Contract between the C~ty of Denton, Texas and the Lake C~t~es Municipal Utlhty Authority ("LCMUA") for wholesale wastewater treatment serwces to LCMUA, substantially tn accordance w~th the Contract which ~s attached hereto and incorporated by reference hereto SECTION 2 That the expenditure of funds as set forth m the Contract Agreement is hereby authorized SECTION 3 That tfus or&nance shall become effecttve tmmedtately upon tts passage and approval PASSED PROVEDth sthe Vday°f ,2001 EULINE BROCK, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY fT.,r ...... APi~OVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY S \Our Documents\Ordmances\Ol\Wholesale Wastewater Treatment Contract LCMUA doc STATE OF TEXAS § COUNTYiOFDENTON § WHOLESALE WASTEWATER TREATMENT SERVICES CONTRACT BETWEEN THE CITY OF DENTON AND THE LAKE CITIES MUNICIPAL UTILITY AUTHORITY City of Denton, Texas, a mumcipal corporation, and Home-Rule City, acting herein by and through its City Manager, hereinafter referred to as Denton, and the Lake Cities Mumclpal Utility Authority, a Texas ._, acting herein by and through its General Manager, hereinafter referred to as "LCMUA" and WHEREAS, Denton owns and operates a wastewater collectaon, treatment, and disposal system an Denton County, Texas, and of their respective systems, both the C~ty of Denton and the LCMUA desire to avoid duplication of services through coordination for the collection, treatment, and reclamation of the wastewater, and WHEREAS, Denton and LCMUA desire to enter into a Contract for Denton to treat wastewater on a wholesale basis for LCMUA for the proposed sixty-seven (67) single-family homes m the Orchards Addition development m the City of Shady Shores, and also in adjacent properties thereto, not to exceed one.hundred total single-family residences, and WHEREAS, the public health, welfare, and safety of the residents of Denton and LCMUA reqmre the development of adequate systems of sewage collection and disposal, the chromatron of water pollution, and the preservation of the water resources of the area, and WHEREAS, Denton and LCMUA are required to comply with standards and treatment methods for wastewater as set forth in federal, state and local, laws and regulatmns and permits, and, WHEREAS, Denton and LCMUA have an :merest in mamtmmng and restonng the ehermcal, physical, and biological integrity of waters and water resources, espemally those being used by Denton and LCMUA, and lnsunng the reductton of pollution in smd waters and water resources, and plarmmg the use, development, restoratton, preservation and enhancement of smd waters and water resources, and WHEREAS, LCMUA desires to contract for wastewater treatment service on behalf of Customers of LCMUA, and Denton desires to provtde wastewater treatment service on a wholesale basis to LCMUA, and WHEREAS, the LCMUA is duly.authorized to enter into thts Contract wqth Denton, and NOW, THERFORE, Denton and LCMUA, in consideratton of the terms, covenants, and condtttons hereto contmned, hereby AGREE as follows ~ All matters stated m the preamble of this Contract are true and correct and are hereby incorporated tnto the body of thts Contract as though fully set forth m their ent~retyherem 1 0 ~ When used m tins Contract, these terms shall be defined as follows 1 01 ~ The Federal Water Pollution Control Act, also known as the Clean Water Act ("CWA"), as amended (33 U S C 1251, et seq ) 1 02 1Biochemical Oxygen Demand (BODI The quantity of oxygen utfltzed m the btochermcal oxidatton of orgamc matter spacffied by procedure tn Standard Methods, and results expressed tn terms of wetght and eoncentratton [mflhgrams per liter (mg/l)] 1 03 ~ Verification of meter accuracy utthzmg standard primary devtce procedures and eahbraUon stgnals and/or a separate flow measurement instalment 2 1 04 C#pita! Imnroventent~. Any of the following faedlties which provide utility services and benefits common to all wholesale and retail Customers, and that have a life expectancy of one or more years located vathm the junsdmtional limits of Denton or the LCMUA wastewater treatment facilities, mctenng and samphng facilities, control systems and appurtenances, all major collectors and Interceptors that are twelve inches (12") and greater in diameter and lift stations associated therewtth, ~ 05 C~teaorieai Industrial User (CIU), An industrial user that is subject to Categorical Pretreatmant Standards aceorchng to 40 CFR Section 403 6 and 40 CFR Chapter I, subchapter N, which are technology-based standards developed by EPA se~ng industry-specific effluent limits 1 06 ~ Depending on the context, may refer to the LCMUA or to LCMUA's Customer or other Customers of LCMUA being provided service pursuant to this Contract 1 07 ~ The facthties of LCMUA used for the treatment, collectaon, and transportation of wastewater to City of Denton from the Orchards Addition and adjacent area 3 08 D~iiverv Facilities. All facilities necessary for the transmission of wastewater from LCMUA System to the Denton System that are on the LCMUA's side of the Point of Entry that are constructed specifically to allow Denton to serve LCMUA 1 09 ire~. The Denton Water/Wastewater Ut~hties Director or the designee Cost. Costs directly assignable to the wholesale customer q q ~ ~ Single family and residential duplex dwellings served by one water meter This defimtlon is used only in the context of determining billing on a per- connection basis 3 12 ~ Expenses incurred by Denton related to wholesale wastewater service, such expenses to be allocated as a System Cost in future cost-of-servme studies 3 1 13 ~ Denton's wastewater collection and treatment system, including the Point of Egtry provided for herein 1 14 Li~MUA Renresentative. General Manager of the LCMUA or designee. 1 15 ~ The expansion of the capacity of an existing facility that serves the same fimctlon as an othervase necessary new Capital Improvement, in order that the existing facility ray serve new or expanded devalopmem The term does not include the repmr, mmntemmce, modermzataon, or an expansion of an existing facxhty to better serve existing development 1 16 ~en~ral Benefit Camtal Facilities. Wastewater facditles that provide utthty services and benefits common to both Denton retml and Denton wholesale Customers, meludlng wastewater treatment facthties, metenng and sampling facthtles, control systems and appurtenances, and all collectors and interceptors that are twelve inches (12") and greater in diameter 1 17 ~ The chscharge or the introduction of mdustnal wastes from any source regulated under Secuon 307(b) or (c) of the Act (33 U S C 1317), ~nto the Denton System (including holding tank waste discharged into the system) 1 18 ~ A source of Indirect Discharge, which does not constitute a "discharge of pollutants" under regulatxons, issued pursuant to Section 402, of the Act (33 U S C 1342) 1 19 ~[]~l:~],-~ All water-borne solids, hqmds or gaseous substances resulting from industrial, mahufacturmg or food processing operations, or from the development of a natural r resource, or any mixture of these vath ware or domestic sewage 1 20 Infiltration, Water that has migrated from the ground into the wastewater system 1 21 ~ Water, other than wastewater that enters a sewerage system (including sewer service connections) from sources such as, but not hm~ted to, roof drams, cellar drains, yard drmns, area drmns, drmns from spnngs and swampy areas, manhole covers, cross connections between storm sewers and samtary catoh bas~ns, coohng towers, storm waters, surface runoff, street wash waters or drainage Inflow does not include, and is d~stmgmshed from tnfiltratmn water 1 22 ~ The water-Dome sohds, hqmds, and gaseous substances derived from eertmn sources including, but not hm~ted to, a grease trap, septic tank, chemical todet waste and sand trap waste 1 23 ~/[9terin~ and Samoiin~ Facility The meter, meter vault, and all metenng and telemetry eqtnpment reqmred to measure and/or sample wastewater flows of LCMUA at Potnt of Entry(s) or mto Denton's System 1 24 Non.domestic Account. Commercml, industrial, multtfamdy or other accounts that are not considered Domestle Accounts This defimtlon ~s used only ~n the context of determmtng bllhng on a per-connection bas~s 1 25 ~ Areas w~tlun LCMUA's certificated boundaries that generate wastewater that do not drmn into a part of the LCMUA system for whmh wastewater flow ~s measured by an approved metenng and samphng facthty 1 26 l~lon-Cate~orieal Industrial User (IlYl. Any non-domestic Industrial User, other than a CIU, wluch tntroduces Wastewater into a pubhcly owned treatment works (POTW) 1 27 ~ The point of connectton to the Denton System 1 28 ~ The reduction of the amount of pollutants, the ehm~nation of pollutants, or the alteratton of the nature of pollutant properties m wastewater to a less harmful state prior to or tn heu of dtschargtng or othorwtse mtroductng such pollutants ~nto a Pubhcly Owned Treatment Works Physical, chermcal or biological processes can obtmn the reduction or alteratton, or process changes by other means, except as prolub~ted by 40 CFR Section 403 6(d) 5 1 29 pr~tre_a~tment Reauiremen~. Pollutant concentratton discharge hmitat~on and reporting reqmremants stipulated m Danton's Sewer Use Ordxnance No 93-112 and any amendments thereto, LCMUA's ordinance or other document, and Federal Pretreatment Standards promulgated by the U S Enxaronmental Protection Agency 1 30 Sionll~l~-nt Industrial User (Sll.r}. Any ~ndustry, wtuch discharges ~ndustnal wastes, d~rectly or indirectly into the LCMUA's System and/or Denton's System · Discharges 25,000 gallons per day or more of regulated industrial wastewater · Is subject to the NarWhal Pretreatment Standards or Categorical Standards of the U S Enwronmental Protection Agency, or, · Has a reasonable potentaal, m the opmmn of the D~reetor, to adversely affect the Denton System due to dtscharge of wastewater with abnormally h~gh strength or contammg hmlted or prohtb~ted substances 1 31 ~ Those testing or analysts procedures as prescribed m the current editaon of "Standard Methods for Examination of Water and Wastewater," pubhshed by the American Pubhc Health Assucmt~on and/or the U S Env~romnental Protection Agency "Manual of Methodologtas for the Exanunatwn of Water and Wastewater," or uall otherwise comply w~th procedures specffied m state and federal d~scharge permits held by Denton 1 32 ~ Operating expenses and capital related costs recurred by Denton in the proxasxon of wastewatar collection and treatment service to the wholesale class of wastewater customers Such costs are to be specifically ~dentlfied by Denton as a component of the annual cost of proxading wholesale wastewater treatment servme 1 33 !0tai Susvended Sohds {TSS~. Sohds, measured in mg/l, that e~ther float on the surface of, or are m suspenswn m, water, wastewater or other hqmds, and whaeh are largely removable by a laboratory filtratmn dewce 1 34 ~ All hqmd or water-camed waste products from whatever source derived, whether treated or untreated, which are d~scherged into or permitted to enter mto the Denton Systent The words "wastewater" and "sewage" are interchangeable 6 1 35 W~tewater System lmnaet Fee, A capital contribution or recouping of the costs of General Benefit facthties, capital improvements or Facility Expansion necessitated by and attributable to new growth and development, and/or expanded growth and development of ex, sUng Customers 2 0 C0nnee_-_'on to the Denton System 2 1 Denton hereby grants to LCMUA, upon compliance w~th the terms and con&t~ons contained herein, permismon to connect the proposed sixty-seven (67) single-family homes ~n the Orchards Addtt~on sub&ws~on, and in the adlacent area for a total, not to exceed one-hundred (100) single-family homes to the Denton System LCMUA shall dehver and &scharge wastewater into the Denton System, and, Denton shall transport, treat, and dispose of the wastewater received from the LCMUA, m accordance w~th tins Contract, unless the Part, es otherwise agree in writing The LCMUA shall provide all lines, metenng station(s), hft statmns, and assoemted facthttes and shall aeqmre all property, ~nterests, licenses, and permits that are necessary to collect and transport Wastewater from the LCMUA to the Denton System 2 2 It shall be the sole responslbthty of LCMUA to convey and deliver the Wastewater to the Point of Entry approved by Denton and designated m Exbablt I Denton agrees to accept all Wastewatar from LCMUA at the Point of Entry as designated on Exhibit I, attached hereto and incorporated hereto A Point of Entry may be changed, or addmonal Points of Entry added upon mutual agreement, s~gned by an authorized representative of each Party LCMUA shall pay for Denton's capital operational and admlmstrat~ve costs incurred due to any change m the location of a Point of Entry, if the change was requested by LCMUA, or necessitated by the LCMUA discharge characteristics Prowded however, that ff such change ~s necessitated by LCMUA's discharge characteristics, Denton shall notify LCMUA of such need by providing written notxce to LCMUA at least sixty- (60) days prior to taking any action on such relocation The nottce shall spemfy the total cost for wtuch LCMUA shall be responsible 2 3 The cost of all Delivery Facilities necessary to convey Wastewater to the designated Points of Entry, whether shown on Exhlbat I, or mutually agreed upon at a later date, together 7 w~th the cost of connection of the LCMUA System to the Denton System including metenng and sampling faefimes, shall be borne by LCMUA m accordance wtth the provasaons ofthas Contract 2 4 Unless mutually agreed to mwnttng by Denton and LCMUA, LCMUA shall be responsable for the design, contractang, constmctaon and financing of Dehvery Facthtaes and acqmsatton of any necessary rights-of-way and easements for such facdmes All dasagns, materials and specfficataons w~tlun the corporate hrmts of the C~ty of Denton, shall conform to Denton's reqmrements as a rmnmaum standard Plans and speclficattons for Delivery FaclhtleS, which are w~ttun the Denton System, shall be submitted to the Darector for written approval No constmctaon shall begin until such approval has been given Approval by Denton shall not be unreasonably w~thheld, ~f the plans and specfficat~ons satasfy or exceed Denton's mammum standards LCMUA agrees that Denton has the right to make periodic ~nspecUons dunng the constructton phase of the Dehvery Facthtaes Final acceptance of such factht~es wathm the Denton System and the sampling and metering facalat~es as subject to the inspection and written approval of the Ctty of Denton Wastewater D~rector, or h~s das~gnee 2 5 ~ At such t~me m the future, should serwce reqmrements become an ~ssue, then Denton and LCMUA shall mamedmtely chscuss, and tf resolutaon of the problem ~s not suscepttble to remedmtaon, then to medmtlon on a good froth basas 3 0 Maintenance of Denton and Customer Systems 3 1 LCMUA agrees to matntam ~ts wastewater system(s) ~n good cond~taon and to make repmrs an a ttmely manner and to reqmre ars customers to ma~ntmn and repmr thear respective systems Denton shall have the night to refuse to accept Wastewater for treatment ~f LCMUA's System(s) is not being maintained to those generally accepted standards set forth m TNRCC rules and regulations, Chapter 317 Denton shall not have any respons~bdaty or habfiaty now or ever for the operation of the LCMUA's System(s), except as agreed to m wrmng by the part~es hereto 3 2 Denton agrees to mmntmn ars system m good condmon and to make mpmrs ~n a tamely manner LCMUA shall not have any respons~bal~ty or habthty now or ever for the operaUon of the Denton System, except as specifically provided here~n, or under separate written modification or Agreement 4 0 Meterin~ and S~mnhn~ Facilities 4 1 Beginning on the effective date of tins Contract, Denton shall have the exclusive right to operate and mmntam LCMUA metering and samphng famlmes at all Points of Entry, and Denton shall become solely responsible for the operauon and maintenance associated w~th these facflxties LCMUA shall have access to the metenng facdmes for mspectlon purposes only LCMUA shall not adjust or calibrate the meter and will continuously provide a route of xngress and egress to said metenng and sampling facilities for Denton Denton shall have the discretion to construct improvements, expansions, and replacements to said facthties as a System Cost, subject to review and approval by LCMUA of all proposed constmctaon, expansion, and replacement plans and costs Approval by LCMUA shall not be unreasonably delayed or w~thheld LCMUA will also grant and provide to Denton such permats or easements as are necessary for the continuous operation and mmntenance of all metenng and sampling facilities All such costs incurred by Denton for operation, maintenance, constmcuon, expansion, and replacement of LCMUA metenng and sampling facthtles shall be considered System Costs Such System Costs shall be specifically identified by Denton as a component of the annual cost of providing wholesale wastewater treatment service 4 2 Expenses recurred by Denton for the operation and mmntenance of LCMUAe metering and sampling facilities shall be System Costs and shall include, but not necessarily be hm~ted to, the foll0wmg A Cost of electricity at the facility B Cost of the installation of the telemetry service at the facility and t° the c°ntr°l center and cost of monthly lease charge for the telephone line C Cost ofmeter calibrau°n' including c°st °f insert meter' twine per year D Cost of parts, materials and supplies reqmred for repairs, calibrations and upgrading of the facilities, E Normal labor cost plus fnnge benefits and indirect costs for repairs, calibrations and upgrading of the facilities F Maintenance of ingress and egress and meter facility site G Meter reading costs 4 3 Replacement of Metenng and Sampling Facilities or components thereof as may be occasioned by obsolescence due to age, excessive maintenance, growth or other reasons as determined by the D~rector shall be a System Cost 4 4 Upon expiration or termination of tins Contract, Denton shall transfer to LCMUA the ownership of any property easements, metenng and sampling facthtles and rights-of-way conveyad to Denton pursuant to the terms of tlus Sectl°n in the event tbe contract Is transferred to another entaty and Denton continues to treat wastewater from LCMUA, ownership of the aforementaonad items shall remmn with Denton 5 0 Meterm~ and Samnlina 5 1 All flow d~scharged into the Denton System by LCMUA shall be metered, unless specffically agreed to by both part, es m writing Should both pames agree m writing that metenng Is not possible, the agreed upon method for detenmmng the volume shall include an adjustment for infiltration and inflow 5 2 LCMUA shall have access to the metenng and sampling facilities at all reasonable times, provided however, that any reading, ealthrat~on, or adjustment to such metenng equipment shall be done by employees or agents of Denton, or by other mutually approved third party Cahbratlon agent, m the presence of representattves of LCMUA and Denton, if so requested by LCMUA Notfficat~on of any proposed tests shall be provided to LCMUA at least seventy-two (72) hours prior to such test being conducted 5 3 All readings of meters will be entered m ink upon bound journals mmntalned by Denton LCMUA shall have access to such records dunng reasonable business hours and shall be furnished with monthly "totahzer" readings for each Point of Entry metenng and sampling facility l0 5 4 Denton shall calibrate and routinely service the meters at least once during each six- (6) month period Copies of the results of such Calibration and all related information shall be promptly proxuded to LCMUA Denton shall notify the LCMUA at least seventy-two (72) hours in advance of the date and tune for any Callbrataon, and LCMUA may observe if so desired 5 5 Upon any Cahbmt~on, if it is determined that the accuracy envelope of such meter is found to be lower than mnety-five percent (95%), or higher than one hundred five percent (105%) expressed, as a percentage of the full scale of the meter, the registration of the flow (and bllhngs related thereto) as determined by such defective meter shall be corrected for a period extending back to the time such inaccuracy began If such time is ascertmnable, or, if such time is not ascertmnable, then for a period extending back one-half (1/2) of the time elapsed since the date of the last calibration, but m no event further back than a period of s~x (6) months 5 6 If additional meter Calibrations are requested by LCMUA over the normal Calibration frequency, then the following payment procedure will be used Corrections to meter Calibrations that are reside the plus or minus 5% range will be prod for by LCMUA and will be added to the LCMUA's next monthly bill for receipt of payment Corrections outside the plus or minus 5% range w~ll be paid to LCMUA by Denton 5 7 If any meter used to detemune volume from LCMUA is out of service or out of repair so that the amount of Wastewater delivered through the period cannot be ascertained or computed, w~thm five percent (5%) accuracy, Wastewater volume shall be estimated and agreed upon by the parttas hereto upon the basis of the best data avmlable Ifa meter is determined to be reading inaccurately by more than five percent (5%), a correction to the billing shall be made as follows (a) Take the number of gallons measured by the meter for a period extending back Va of the tune elapsed since the date of the last cahbrataon of the meter, (b) Multiply that amount by the percentage of ~naccuracy to obtmn the total number of gallons not properly registered, (c) Multiply the gallons by the apphcable rate dunng the time of the inaccuracy to get the amount to be debited or credited, as appropriate If a meter completely fails, a correction shall be made by using the average of the gallons of wastewater billed for the prior three months, or some other mutually agreeable method, to obtmn a dmly average, wtuch shall be applied to the days for which the meter was not working In the event that the parUes hereto cannot agree on the estimate of Wastewater volume dehvered, agreement on the flow volume vail be deterrmued by a committee composed of the Director (or his designee) the LCMUA Representattve (or his designee) and a third person to be mutually agreed upon and the cost of the reconclhataon process will be equally shared Any adjustments in bflhng prowded m this Section, whether a credit or debit, may be satisfied immediately, or may be made m equal installments over the tame equal to the tame for which the failure or inaccuracy was calculated 5 8 Denton shall obtain samples three (3) times per year to determine the quality of the wastewater for bdlmg for the extra strength of the wastewater Each set of samples will apply to a four-month period for bdhng purposes These samples shall be obtmned at the designated metenng and sampling facd~taes or other mutually agreed upon sampling points for the purposes of bdhng for the strength of the wastewater To determme the quahty of the wastewater for each of the three (3) sampling periods, Denton shall collect twenty-four (24) hour flow-weighted composite samples for five (5) consecutive days In case of a malfunction of the sampling eqmpmant for whatever reason for one or more days, additional days shall be added to obtain five (5) samples The five (5) samples vail be averaged to determine the wastewater strength for bflhng purposes Unless the BOD or TSS exceeds 250 rog/l, no fee for extra strength shall be applicable or charged Denton vail provide LCMUA vath a mimmum of seven (7) day advance notaficatlon of intent to sample If, at the request of LCMUA or at the request of the Director, more extensive momtonng is desired, such addttaonal momtonng shall be prod for by the party making the request and shall be done In compliance and in accordance vath Sectaon 6 5 If LCMUA requests such additional momtonng, Denton shall mvome LCMUA for the operational and adrmmstrattve costs and payment shall be made vattun (30) thirty days after receipt of invoice The notification required in tl~s section shall include the planned dates, times, and locataons(s) of sampling Denton shall analyze the samples collected ui accordance with Standard Methods LCMUA may be present dunng the lmtaal set-up of sampling equipment and at the tame of pick up for each twenty-four (24) hour composite sample Denton agrees, if requested, to spht said wastewater samples with LCMUA for independent analyses If, m the optmon of the Dtrector, eomphanee momtonng ~s required, the Dtrector may order that adfl~ttonal momtonng be performed wath or wathout prior noUce to LCMUA Smd comphance momtonng ts to be m addttton to the penodtc samphng set forth tn SecUon 5 8 All mformatton obtmned because of such comphance momtonng shall be provtded to LCMUA Denton wall provtde not,ce of the results of such comphance momtormg to LCMUA wathm a reasonable me thereafter Denton shall pay all costs for addtttonal momtonng ordered at the Director's d~screUon, pursuant to thts paragraph 5 10 Costs mcurred by Denton under thts Seetxon 5 wall be constdered a System Cost 60 6 1 Wholesale wastewater rates wall be based upon generally accepted cost-of-serwce rate methodologies developed by independent utility rate consultants as described heretn The Dtrector shall select the independent utility rate consultant The cost of such studtes will be a Dtrect System Cost All eost-of-serwce studies shall be conducted utilizing the unhty cost basts of determlmng revenue reqmrements apphcable to the wholesale Wastewater class The last rate study was completed dunng 1999 by an tndependent consultant Rate smdtes by an tndependent utility rate consultant wall be conducted at least every s~x (6) years Internal rate reviews wall be conducted annually, based upon consultant rate study methodology, to revtew rates and charges, to recover allocated costs LCMUA shall have access to all data used to calculate the proposed rate to be charged, and LCMUA wall be prowded at least stxty- (60) days advance not, ce wath opportumty to revtew and comment on any proposed rate changes 6 2 The eost-of-servtce for the wholesale class shall xnclude allocated reasonable and necessary operatton and maintenance expense, deprectatton expenses, admmtstrattve expenses, a faxr and reasonable remm on allocated capttal famhttes, and a street rental fee To determine the allocation, mcluchng inflow and mfiltratxon of costs to LCMUA, the followang factors shall be constricted total volume, rate of flow, wastewater quahty, metenng, and LCMUA related costs (such as accounting, bflhng, momtonng and LCMUA service) "Capital-related costs" consists of depreciation expenses and return on the original cost rate base "Depreciation expense" will be based upon the ongiual cost of all capital facilities, both invested and contributed capital, wluch facilities are expected to be replaced by Denton at a future date in order to mmntmn sermce Costs to transport the wastewater will be based on interceptor lines twelve roches (12") in diameter and greater A street rental fee equal to four percent (4%) of total wastewater operation and maintenance costs will also be charged by Denton On a penodm basis as determined by the Director, the depreciation rates on all General Benefit Capital Facilities shall be studied, and new salvage values, useful lives, and annual rates of depreciation shall be developed from such studies The "net-book" rate base shall consist of all allocated capital facthties (net of accumulated depreciation and less contributions to the Denton System), and shall include construction work m progress, a reasonable allowance for working capital, and a reasonable inventory of materials and supplies necessary for the efficient operation of the Denton System Working capital shall be based on one-eighth (forty-five days) of annual wastewater operation and mmnteuance costs Records of the original cost, the accumulated depreciation on all capital facilities, and contributions to the Denton System shall be mmntmned in the Denton fixed asset-tracking system These records shall be avmlable for inspection at the Denton Utilities Financial Department dunng reasonable business hours upon request by LCMUA 6 3 Denton shall be allowed an adequate opportunity to earn a reasonable return on its investment The rate of return shall be sufficient to assure confidence m the financial soundness of the utility, adequate to mamtmn and support its credit, enable it to raise the money necessary for the proper discharge of its public duties, and shall be equal to the weighted average imbedded rate of interest on all outstanding wastewater system revenue bonds plus one-and-one-half percent (1 5%) 6 4 Not more frequently than every sm (6) years, a detailed wholesale revenue reqmrement shall be developed on an actual historical cost, test-year basis, allowing for reasonable and necessary expenses of providing such wastewater service, and allowing for known and measurable changes in costs Such changes shall allow the spreading of non-recumng expenses over an appropriate benefit period The first test year occurred October 1, 1997, through September 30, 1998 On a not more frequently than every six (6) year basis thereafter, a complete, detmled rate study will be performed with the same methodology used in the previous 14 rate study by an mdapendent utthty rate consultant Thereafter, changes an the methodology wall be allowed ff recommended by the independent consultant In the antenm between complete detmled rate studaes, wholesale wastewater rates shall be adjusted by Denton using the same methodology adopted at the same tame, of the last complete detmled rate study utlhzmg the actual operating data for the twelve month period endmg September 30th Of the prior year, adjusted for known and measurable changes an cost data whmh may have occurred s~nce the last auchted statement 6 5 The lmtaal rates for thts Contract shall be those adopted by the Denton City Council an Or&nance No 2000-295, finalized m September 2000, effecuve October 1, 2000, as follows Volume Charge BOD Strangth Charges TSS Strength Charges Facthty Charges Sampling Charge Analysas Charge $2 00 per 1,000 gallons $0 004228 mg/l of BOD above 250 mg/l $0 002317 mg/l of TSS above 250 mg/l $180 00/30 days $35 00 $15 00 6 6 Amendment of Rate The rate charged LCMUA shall increase or decrease m accordance wath any amendment to the Rate Schedule applicable to LCMUA, as approved by Ordinance of the CaW Council of Denton, and normal and reasonable increases m cost of servace At least smty- (60) days prior to the effective date of any proposed amendment of the rate charged to LCMUA, Denton shall send wnttan notxce of the proposed rate amendment to LCMUA if Denton finis to gxve written notace at least sixty- (60) days prior to the effective date of the amended rate, the amended rate shall become effective, as at applies to LCMUA, on the sxxty - first (61st) day after the written notace as sent 6 7 Denton shall render bills for Wastewater treatment and &sposal servace to LCMUA All such bills shall be due and payable by LCMUA not more than thirty- (30) days from the balhng date The bills wll show current charges, as well as past-due charges Current charges shall be the amount due for Wastewater collactmn, treatment and &sposal servace provaded sance the prior billing period Past-due charges shall be the total amount unpmd from all prior bdhngs as of the current billing date Payments received shall first be applied to the past due charges, if any, and thereafter to the current charges For late payments, a finance charge of ten percent (10%) per annum may be calculated from the date when the payment was due until prod 6 8 If LCMUA disputes a bill and is unable to resolve the &fference informally, LCMUA shall notify the Director in writing Dispute of a bill is not grounds for nonpayment If LCMUA at any time chsputes the mount to be prod to Denton, LCMUA should nonetheless promptly make such payment, but, if it is subsequently determined by agreement or court decision that such disputed payment should have been tess, or more, Denton shall promptly correct the charges All such amounts due and owang to Denton by LCMUA, or due and owang to LCMUA by Denton, shall be paid plus ten (10%) percent per annum from the date when due until paid 6 9 The parties agree that services obtmned pursuant to tlus Contract are essential and necessary to the operation of LCMIJA's wastewater facdmes, and that all payments made by LCMUA shall constitute reasonable and necessary operating expenses of wastewater systems wattun the meaiung of Article 1113, Vemon's Annotated Texas Statutes, wath the effect that the obligation to make such payments shall have priority over any obligation to make any payments from such revenue, wath respect to all bonds or other debt obhgations heretofore or hereafter issued by LCMUA 6 10 LCMUA agrees, throughout the term of this Contract, to fix and collect such rates and charges for wastewater service in its system as wall produce revenues in an amount equal to at least (I) All of the operation and maintenance expenses of such system, including specifically, its payments under tlus Conlxaet (II) All other amounts as reqmred by law and the provisions of the ordinances or resolutions authorizing ars revenue bonds or other obhgatlons now or hereafter outstandtng, including the amounts required to pay all pnnmpal of, and interest on such bonds and other obligations 7 0 LCMIJA Concerns and Dianutes 7 1 LCMUA shall notify the Director regarding any concern or dispute related to the wholesale Customer volumes btlled and/or wholesale rates charged Denton shall provide explanations and/or documentation which outlines the processes used by Denton in order for LCMUA to fully understand how the monthly volumes and billings were determined and/or wholesale rates were calculated 7 2 If LCMUA disputes the monthly billing and/or rates, LCMUA must continue to make prompt monthly payments as required by this Contract If, after a thorough rewew, LCMUA's concern or dispute ~s determined to have merit and justification, the area of concern or dispute shall be promptly adjusted and corrected Unless otherwise specified in this Contract, the determmataon or settlement m areas of dispute, wall generally be judged in accordance with standard practices used m the wastewater treatment and collection industry, while consldenng fmmess to both pames 8 0 Industrial Connectnon and Monitorinl 8 1 LCMUA agrees that it wall not permit any Significant Industrial User watlun its junschchon to connect directly or indirectly, either to its system, wathout at least thirty- (30) days prior written notfficatlon to the Director of such intent to connect LCMUA shall prowde the Director wath such information pertaining to volume and composition of expected flow as may be requested After a review of the submitted data, the Director has the right to refuse the permit only if such SIU would cause Wastewater dascharged by LCMUA at the Point of Entry to be m violation of this Contract 8 2 LCMUA agrees to conduct any and all momtonng, sampling and inspection of LCMUA System and Industnal Users as necessary to msure that ~ndustnal waste introduced into the LCMUA System meets the quahty standards set out in Section 9 2 hereof Upon request to LCMUA, a representative of Denton wall be permitted to observe LCMUA's collection of samples from Industrial Users, and LCMUA agrees to furnish Denton separate duplicate samples for independent testing, and, upon request, to provide the Director sample analysis results and Pretreatment records 17 8 3 LCMUA agrees that Denton shall have the right to sample wastewater at all Points of Entry and at such other locations as may be mutually agreed to m writing by both parues, for the purpose of detemumng the volume and quality of wastewater entenng the Denton System LCMUA agrees to disconnect from its system any Industrial User found to be m violation of allowable discharges or who refuses access to its facfl~ties for the purpose of sampling wastewater being discharged into the LCMUA System, provided, however, that smd disconnected Industrial User shall be afforded the same rights and pnwleges of appeal as Industrial Users operating w~ttun Denton's jurisdiction Provided, however, Denton may not require such Industrial User to disconnect from LCMUA's System, if the quality of the wastewat~r dehvered to the Pmnt of Enmy is m comphance with this Contract 8 4 Follovang reasonable not, ce to LCMUA by Denton, Denton may enter LCMUA's jurisdiction if Denton determines that questionable discharges or prohibited discharges are entenng the Denton System through the Point of Entry LCMUA agrees to assist Denton and to coordinate with its Customers in locating and ehmmatmg such prohibited discharges wltlun the LCMUA System 85 The Darector shall send written notace to the LCMUA if it is determined that a Customer is fmlmg to provide a satisfactory Pretreatment program, or a d~scharge by the LCMUA is in violation of the SUO or this Contract The notme shall contmn the following (a) (h) (c) (d) the nature and description of the violation, the provision of the SUO or of this Contract being violated, the correct, ye actaon that must be taken, and the time in which the corrective action must be taken Denton and LCMUA shall cooperate to determine the source of any wastewater discharge violation and agree to cooperate in remed3nng the violation, but, LCMUA shall be responsible for lnsunng that the molataon is properly and timely corrected LCMUA's fmlure to take reasonable efforts to have the violat~on corrected m the time specified shall be a breach of this Contract for which Denton may tenmnate service to the particular Customer whereto the offending violation is tal, ang place 9o 9 1 LCMUA agrees that it shall enact operating pohcles and enforce an ordinance govermng industrial waste that are at least as stringent as the prowsions of the current Denton Sewer Use Ordinance No 93-112 (SUO) 9 2 The parties recogmze that federal and state laws and regulations concerning Wastewater treatment and discharges may periodically change dunng the term of this Contract, requmng revisions in the SUO It is the intent of this Contract that the SUO be rewewed periodically by Denton and revised m accordance wath the latest laws and regulations of federal and state agencies having jurisdiction over wastewater treatment and d~scharges LCMUA agrees, upon reasonable notice, to enact and enforce ordmancas or any amendments to the SUO, or any future ordinances relating to industrial d~scharges, prohibited or controlled wastes, or Pretreatment Reqmrements 9 3 Denton shall give written not,ce to LCMUA at least ninety- (90) days prior to consideration by the Denton C~ty Council of any amendment of the SUO that amends a prows~on of the SUO that applies to tbas Contract, or that adds a new prows~on to the SUO that Denton ~s reqmred to apply to wastewater received by Denton under this Contract 9 4 LCMUA shall be responsible for glwng notice of the proposed amendment to any of its Customers affected by the amendment Upon the effective date of the amendment to the SUO, it shall be consadered an amendment to th~s Contract and shall be attached hereto, showing the amendment made LCMUA shall adopt and enfome such proposed ordinances or amendments as soon as reasonably practicable after the effective date of the Denton ordinance or amendment, prowded that LCMUA ~s properly notffied of the ordinance or amendment reqmred herein 9 5 LCMUA agrees that the quality of the wastewater discharged into the Denton System shall be equal to or better than the qnahty standards estabhshed by Denton Ordinance No 93- 112, or to any amendment thereto adopted pursuant to Section 9 1 9 6 LCMUA shall reqmre all Significant Industrial Users within its jurisdiction that ultimately discharge into the Denton System to apply for and obtmn a permit from LCMUA allovang such discharge Such permit shall require Industrial Users to abate prolubited substances from their discharge as a condition to discharging wastewater into the LCMUA System The penmt application shall eontmn, as a munmum, the following 1 Name and address of discharger 2 Agent for discharger 3 Type of industry 4 Products produced or services rendered 5 Chemicals being stored and/or used 6 Antmipated da~ly wastewater flow rates LCMUA shall provide Denton a copy of such apphcat~on and permit, if issued, wathin fourteen (14) days after issuance 10 0 Title lo and Liability for D~_mn~es and Responsibility for Treatment and Disnosal of Wastew~ter Liability for damages arising from the transportation, delivery, reception, treatment, and/or disposal of all wastewater discharged into the Denton System hereunder shall remain with LCMUA to the Point of Entry, and upon passing through Point of Entry, title to such wastewater and liability for such damages shall pass to Denton As between Denton and LCMUA, each party agrees to mdemmfy the other to the extent permitted by law and to save and hold the other party harmless from any and all clmms, demands, causes of action, damages, losses, costs, fines, and expenses, including reasonable attorney's fees, which may arise or be asserted by anyone at any time on account of the transportation, delivery, reception, treatment, and/or disposal while title to the wastewater is in such party, or on account of a prohibited discharge by the LCMUA Denton has the responsibility for the proper reception, transportation, treatment and disposal of all wastewater discharged into the Denton System, but not for prohibited discharges by any party at any Point of Entry Denton may, after treatment of such wastewater, reclaim, use or sell the water, sludge or any other product for reuse Wastewater entenng the Denton system becomes the property of Denton 20 LCMUA agrees that it has an obligation to prevent infiltration and inflow into its system and then into the Denton System LCMUA further agrees that all sewer connections watinn its junsdleUon, winch ultimately enter the Denton System, will be constructed in accordance with apphcable specifications and standards at least equal to those of the Denton System Further, LCMUA covenants and agrees to mmntmn strict supervision and mamtenance of xts system to reasonably prevent eonneetmns through winch surface drainage can enter the Denton System LCMUA shall not make, nor shall it penmt to be made, any connection, wluch will contribute storm water run-off from rmnwater, spouts, drmnage areas, streets, gutter drmn or other source of ' m rmnwater into LCMUA s Syste 12 0 Assistance 12 1 In the event, LCMUA requests assistance with the LCMUA System, Denton may, at ~ts option, assist LCMUA LCMUA agrees to pay Denton its actual costs incurred, including, but not limited to, admimstratlon, labor and material expended, as documented by Denton Nothing herem shall be construed to require Denton to assist LCMUA Such costs will be mvomed to LCMUA and payment made wathm tbarty- (30) days after receipt of mvome Should the LCMUA request a long term Operations and Mmntenance Contract for the LCMUA system, then, m that event, a separate contract can be prepared 12 2 In the event, Denton requests assistance with the Denton system, LCMUA may, at its option, assist Denton Denton agrees to pay LCMUA ~ts actual costs incurred, including, but not limited to, admunstratton, labor and material expended, as documented by LCMUA Nothing herein shall be construed to require LCMUA to assist Denton Such costs wall be invoiced to Denton and payment made wttinn tinrty- (30) days after receipt of invoice 130 If requested by the D~rector, LCMUA, shall provide the followang data on an annual basis A Actual number of Customer accounts dischargmg ~nto the Denton pmnt of entry B C Classification of Domestac and Non-Domestm Accounts vathm ats servxce area by number and pementage of accounts dtschargang mto the LCMUA System Addtt~onal data wluch may assist Denton and/or LCMUA ~n developing methodology for cost of service studies, planning smdtes for analyzing federal grants, and wholesale system Impact Fees, prowded, however that Denton shall not request data that will reqmre LCMUA to ~ncur unreasonable expenses m providing such data 14 0 Any nouce, commumcat~on, request, reply or advice herein prowded or penmtted to be gxven, made or accepted by eather party to the other party must be ~n writing to C~ty of Denton Cay Manager C~ty of Demon, Texas 215 East McKmney Denton, Texas 76201 LCMUA General Manager Lake C~t~es Munmapal Utthty Authority P O Box 355 Lake Dallas, Texas 75065 The parttes hereto shall pmwde not~ce ~n writing of any change that may occur m thear respective addresses from t~me to t~me 15o Complete records and accounts reqmred by each party hereto shall be kept for a period of five (5) years Each party shall at all t~mes, upon notme, have the right at reasonable tames to examine and ~nspect smd records and accounts during normal busaness hours, and further, ff reqmred by any law, nde or regulatton, make smd records and accounts available to federal and/or state auditors Whenever, under the terms of this agreement, Denton ~s permitted to gave its written consent or approval, Demon may g~ve or may refuse such written consent or approval and, af g~ven, may restrict, hmat or eondmon such consent or approval in any manner at shall deem admsable, however, consent vall not be unreasonably w~thheld 22 1~ 0 Wgwer~ Remed,Y~ Severnbfiit¥ 16 1 No waiver by exther party hereto of any term or condition of th~s Contract shall be deemed or construed to be a wmver of any other term, or condition, or subsequent waiver of the same term or conchtlon 16 2 In addition to any other remedy as may be provided by law, this Contract shall be specifically enforceable by the part, es hereto Venue for any action shall be in Denton County, Texas This Contract shall be governed by the laws of the State of Texas 16 3 It is agreed that, in the event any term or provision herein contmned xs held to be invalid by any court of competent junsdletlon, the mvahdlty of such term or provision shall in no way affect any other term or provision contmned herein, further, flus Contract shall then continue in full force and effect as if such invalid term or provision had not been contmned herein 17 0 Ownershin and Liability 17 1 Except as expressly provided herein, tins Contract shall not be construed to create any type of joint or cqmty ownership of any property, any partnership or joint venture, nor create any other property rights or habdmes LCMUA payments (whether past, present, or future) will not be construed as granting to LCMUA any partial ownership of, prepmd capacity in, or equity in the Denton System Provided however, LCMUA shall have the continuing right to receive the services proxaded for herein under the terms of tins Contract 17 2 Contracts made and entered into by either LCMUA or Denton for the construction, reconstruction or repmr of any Dehvery Facility shall ~nclude the reqmrement that the independent contractor(s) must provide adequate insurance protecting both the LCMUA and Denton as insured Such contract must also provide that the independent contractor(s) covenant to indemnify, hold harmless and defend both the LCMUA and Denton agmnst any and all suits or elanns for damages of any nature arising out of the performance of such contract 23 18 0 Comnhance with Permit Condittons LCMUA acknowledges that Denton is the holder of discharge permits issued by the Umted States of America and the State of Texas LCMUA agrees that it will comply with all permit conditions m any way relating to ~ts collection system and any discharge tnto the Denton System LCMUA agrees that m the event, a fine ~s assessed against Denton for any violation of any permit condmon, and the molatlon is attributable to any act of omission or commission by LCMUA, LCMUA will pay to Denton the mount of such fine If such fine is not attributable to LCMUA, such f'me shall be paid by Denton 19 0 Tgrpa of Contract/Effective Date The initial term of t!ms Contract shall be for twenty (20) years, and it shall be thereafter extended m ten (10) year increments LCMUA may elect to terminate flus Contract by provlchng Denton with a sm (6) month advance written notice, prowded that such terminaUon shall not be effective until the end of Denton's fiscal year Denton may elect to terminate this Contract by providing LCMUA w~th a six (6) month advance written not,ce, provided that LCMUA has extended its sewerage colleeUon system to the Orchards Addition and is able to transport the wastewater to the Upper Tnmty Regional ReclamaUon Facthty 20 0 Force Majeure No party hereto shall be considered to be m default m the performance of any of the obhgat~ons hereunder (other than obhgaUons of e~ther party to pay costs and expenses), if such fatlure of performance shall be due to an uncontrollable force beyond the control of the part,es, including but not hmlted to fmlure of facfl~ttes, flood, earthquake, tornado, storm, fire, hghtmng, ep~demm, war, not, civil d~sturbance or d~sobed~ence, labor dispute, and action or non-actaon by a failure to obtain the necessary authonzataons and approvals from any governmental agency or authority or the electorate, labor or material shortage, sabotage, or restraint by a court order or pubhc authority, which by the exercise of due dthgence and foresight such party could not have reasonably been expected to avoid and which by exercise of due diligence ~t shall be unable to 24 ovemome Either party rendered unable to fulfill any such obligation shall exercise due dfltgence to remove such inability wath all reasonable daspatch In the event the proper operation of the Denton System, as a result of the above, reqmres Denton to temporarily interrupt all or part of the serwces to LCMUA, no clmms for damage shall be made by LCMUA against Denton Denton will exercise its best efforts to insure that such interruptions will not adversely affect the health and welfare of the LCMUA's residents In the event the proper operation of the LCMUA System, as a result of the above, requires LCMUA to temporarily interrupt, reduce or increase flow to the Denton System, no claims shall be made by Denton agmnst LCMUA 21 0 Wastewater Imuaet Fees The Denton City Council has adopted "Impact Fees" by amending Chapter 26 "Utilities" of the Code of Orrhnances, Ordinance No 98-301, providing for the Assessment of Such "Impact 21 1 On a quarterly basis, LCMUA agrees to pay to Denton a Wastewater System Impact Fee for each new or enlarged connectton for Wastewater service made wtthln LCMUA's service area served by the General Benefit Capital Facflit~as of the Denton System LCMUA agrees to place quarterly tmpact fees received m an lnterest-beanng account and renut to Denton on a quarterly basis the nnpact fees plus interest earned The Wastewater System Impact Fee to LCMUA for each such connection shall be based upon the size of water meter and shall be equal to the Wastewater System Impact Fee collected for the same s~ze water meter made w~tlun the retml service area of Denton, except as provided m subparagraph 21 6 of this Section Water meters installed solely for lrngat~on purposes shall not be assessed a wastewater Impact Fee The calculation of the Wastewater System Impact Fee shall be consistent with all applicable state and federal regulations, including Chapter 395, Texas Local Government Code, or any amendment or successor statute It shall include only those costs associated with wastewater system capital expansions and capital maprovements identified by Ordinance No 98-301 or amendments of smd Ordinance, necessary to provide serwce to new growth and development, and/or expanded growth and development of existing Customers Nothing w~thln this Contract shall be deemed to prevent eather Denton or LCMUA from charging thear own retml Customers an ~mpact fee m excess of the wastewater system Impact Fee provaded for hereto 21 2 Denton agrees that all momes for Impact Fees rematted to ~t pursuant to thas section will be placed m a separate anterest-beanng account to pay only for the cost of constmcung capital ~mprovements or facthty expansions for the wastewater system as permitted by Chapter 395, Texas Local Government Code, or any amendment thereto, or by any successor statute thereto, and wall not be used for operaUon and maintenance expenses Once expended on capital projects, such funds and all anterest earned thereon wall be considered a "contnbutaon" for rate setting purposes and shall not be included m the rate base for wholesale service or return on anvestment calculation purposes Deprecmtaon expense will be based on the original cost of all capital facthtaes both invested and contributed capatal, whtch factht~es are expected to be replaced by Denton at a future date m order to mmntam servme 21 3 LCMUA shall provade to Denton such information that relates to the making of new and~or ups~zed connections wathm ats 3unsdactaon as may be requested by the D~reetor, including but not lmuted to bmkhng permits, wath each quarterly payment reqmred an th~s SecUon 21 4 Should Denton or LCMUA wmve any ~mpact fee due from a retml Customer for a new or upsazed conneeUon to ats respectave system wattun ats junsdmUon, Denton or LCMUA shall pay such ~mpact fee from other sources ~nto the fund mqmred for paying for the capatal ~mprovements 21 5 Denton agrees that only those capital improvements related to the wastewater system ldentffied m Ordinance 98-301 or amendments of smd ordinance, shall be ~ncluded m the capaal amprovements plan for the purpose of detenmmng Wastewater System Impact Fee, provided, however, Denton may include other capatal ~mprovements for the purpose of determlmng impact fees to tts own retail Customers 21 6 Prior to the adopUon of any land use assumpUons, capital ~mprovements, or Impact Fees, the LCMUA shall be fumashed a copy of the proposed land use assumptions, capital ~mprovement plan or proposed Impact Fee at least thirty- (30) days prior to any scheduled heal'lng thereon Any revised Impact Fee adopted pursuant to such updated capital improvements plan shall not take effect for a period of at least ninety- (90) days after adoption by Denton 22 0 Termination 22 1 This Contract is not intended to specify an exclusive remedy for any default, but all such other remechas (other than terun~tion) existing at law or in equity may be availed of by either party and shall be cumulative Recogmzmg, however, that the fmlure of either party to perform cannot be adequately compensated in money damages alone, both parties agree that in the event of any default on its part, the other shall have available to it the eqmtable remedy of mandamus and specific performance, in addition to any other legal or eqmtable remedies (other than termination) which may be avmlable The remedy of termination for default precluded by this paragraph does not prohibit either Party from terminating tlus Agreemem for default In accordance w~th the terms of this Agreement, or as otherwise specifically provided herein 22 2 Also this Contract may be terrmnated in whole or in part by the mutual consent of the govermng bodies of LCMUA and the City of Denton Notwithstanding anything contmned herein to the contrary, any material breach, as defined hereto, by either party hereto shall be cause for temunatlon of tins Contract by the other Party in the manner set forth mttus Section 22 3 For fmlure to pay for undisputed costs for services rendered in accordance w~th this Contract, Denton may terminate tins Contract sixty- (60) days following the date notice of nonpayment is received by LCMUA, unless full payment is made by LCMUA vathm that nme 22 4 The terms and procedures set forth in Sections 22 2 and 22 3, while referring primarily to Denton, shall be equally applicable to LCMUA Denton shall deliver to LCMUA mnety- (90) days prior written notice of its mtentaon to so terminate this Contract if LCMUA finis to cure or adjust such material breach, ~ncludmg m such notice a reasonable description of the breach In the event LCMUA does not agree that a is in such breach, default or failure, LCMUA may respond m writing for Danton's further rewew, or, m the alternative LCMUA may respond with a plan of action for Denton's approval, wluch approval will not be unreasonably demed Denton 27 shall advise LCMUA in writing anmedmtely upon acceptance of the cure of any such breach If wlthm smd mnety- (90) days LCMUA shall fro1 or refuse to cure such breach to the reasonable satisfactaon of Denton, then and in such event, Denton shall have the right with six months advance written additional not, ce to LCMUA, to declare flus Contract terminated In the event of tcnmmmon of this Contract, all rights, powers, and privileges of LCMUA hereunder shall cease and terminate The following breach, default or failure to perform a duty or obligation shall be considered a material breach a Failure to adopt and enforce any ordinance reqmred to be adopted and enforced herein, if LCMUA has received notice as reqmred in Section 10 of flus Agreement, or if by a Customer of LCMUA, the failure of LCMUA to take reasonable steps to obtmn such action by Customer b Makang any connection to the Denton system at any point except as provided xn Section 2 2 hereof c Fmlure to provide Denton ingress and egress for purposes of sampling and operation and mamtanance of any metenng or any sampling facthty d Fmlure to pemut any sampling of Wastewater as provided for herein e, Foalure to mamtmn the quality of discharge as required in this Contract f Foalure of LCMUA to comply with Section 10 hereof g Fmlure of LCMUA to comply with Sectaon 21 hereof h Failure of Denton to provide the services reqmrcd by this Contract or to carry out its duties and responsibilities under flus Contract 22 5 In case of any other breach, default, or fmlure to perform duties under this Contract, not addressed by Sections 22 3 or 22 4, Denton shall deliver to LCMUA s~xty- (60) day's advance written not~ee of such breach In the event LCMUA does not agree that it is m such breach, default or failure, LCMUA may respond in wmmg for Denton's further rewew, or in the alternative LCMUA may respond with a plan of action for Denton's approval, winch approval will not be nnreasonably demed LCMUA may tamely appeal Denton's determination of breach or Denton's fmlure to approve its plan cure the alleged breach to the Utthty Account Review Committee of the City of Denton, Texas, as provided for in the Denton Code of Ordinances, Chapter 26 28 22 6 Any failure by Denton to terminate this Contract or the acceptance by Denton of any benefits under flus Contract for any period of tune after such material breach, default, or failure by LCMUA, shall not be detarmmed to be a wmver by Denton of any rights to terminate this Contract for any subsequent material breach, default, or fmlure 22 7 Any fmlure by LCMUA to so ternunate this Contract, or the acceptance by LCMUA of any benefits under ttus Contract, for any period of time after such material breach, default, or fmlure by Denton, shall not be determined to be a wmver by LCMUA of any rights to terminate this Contract for any subsequent material breach, default or failure 230 ~ 23 1 Tlus Contract ~s subject to all applicable federal and state laws and any apphcable permits, ordinances, or amendments adopted pursuant to Section 10 0 and any rules, orders, or regulatmns of any state or federal governmental authority having or asserting jurisdiction Notlung contained hereto shall be construed as a wmver of any right by either party to question or contest any such law, ordmance, order, rule or regulation m any forum having jurisdiction 23 2 The parties hereto agree to make any changes m tlus Contract made necessary by any amendment or revlmon to state or federal regulations 23 3 Upon prior notice by Denton, any duly authorized employee of Denton beanng proper credentials and ldentfficatlon shall notify LCMUA of need for access to any premises located vathln the LCMUA's boundary lumts or wlttun an area served by Argyle for the purpose of inspections and observation, measurement, sampling and testing and/or audmng, in accordance w~th the proxasmns of flus Contract LCMUA may elect to accompany the Denton representative To the extent pemutted by law, Denton agrees to ~ndemmfy LCMUA and hold LCMUA harmless for any damage or any mjury to person or property caused by the negligence of such duly authorized employee while such employee ~s in the course and scope of h~s employment 23 4 In each instance herein where reference is made to a federal or state regulaUon, it is the intention of the pames that, at any given time the current federal or state regulation shall apply If a publication or reference work referred to herein is discontinued or ceases to be the generally accepted work in its field, or if conditlons change, or new methods or processes are implemented by Denton, new standards shall be adopted which are in compliance with state and federal laws and any vahd rules and regulaUons pursuant thereto 23 5 Section heachngs m thts Contract are for convenience only and do not accurately or completely describe the contents of any Section Such headings are not to be construed as a part of this Contract, or in any way defimng, hunting or amplifying the provisions hereof 23 6 Whenever any disputed matter hereto is to be specifically determined by the use of a mediator, the following procedure is to be followed The party requesting that the dispute be settled by medlatton shall serve on the other party a request in writing that such matter be handled by med~ation LCMUA Representative and Director shall mutually agree in wnttng on the selection of an lmpartxal mediator Such agreement shall be made within ten (10) days from the date that the request for mediat~on ~s received If agreement is not reached on the selection of the ~mpamal medmtor on or before the tenth (10th) day after the date that notice is received, the Director shall munedmtely request a hst of seven qualified neutral mediators on the list If they do not agree wtttun five (5) working days after the receipt of the list, LCMUA Representative and Director shall alternate stoking a name from the list and the name remmmng shall be the impartial mediator LCMUA Representative and Director shall mutually agree on a date for the mediaUon The decision of the mediator shall not be final Mediation shall not in any event toll any default period under the Contract, unless approved mutually in writing by Denton and LCMUA IN WITNESS WHEREOF, the Pames hereto have caused this Contract to be executed in duphcate original counterparts, by their respective officers and officials, thereunto duly authorized 30 By CITY OF DENTON, TEXAS MICHAEL A CO~''~- - '~' '~D/~ty Manager ATTESTED JENNIFER WALTERS, CITY SECRETARY APPROVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY ATTESTED LAKE CITIES MUNICIPAL UTILITY AUTHORITY ~/~O~N~/ HAndS, General Manager By APPROVED AS TO LEGAL FORM JAMES E SHEPHERD, ATTORNEY L \CLI~TS\4 5999x5410\Wholesale Wastewatcr Treatment Contract LCMUA do 31