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11-0802_MUNICIPAL WATER DISTRICT OC_Agreement Christy Jakl From: Justin Kirk Sent: Wednesday, August 01, 2012 5:04 PM To: Christy Jakl Cc: Maria Morris Subject: FW:Agreement Between MWDOC and Its Member Agencies on Budget, Activities, Charges, and Other Issues Attachments: Member Agency Agreement with Signatory Pages.pdf FYI... ,�Tus�irl ��k Senior Management Analyst Utilities Department City of San Juan Capistrano From: Karl Seckel fmailto:kseckel@mwdoc.com] Sent: Wednesday, August 01, 2012 5:02 PM To: Justin Kirk Cc: Keith Van Der Maaten; West Curry; Pat Meszaros; Maribeth Goldsby Subject: RE: Agreement Between MWDOC and Its Member Agencies on Budget, Activities, Charges, and Other Issues Justin, et al—I cannot explain why we did not get you to sign the agreement other than there seemed to be much confusion as to which form of agreement you were supposed to sign. We had you noted as approving the agreement. The implication at this time is not of any consequence. You can put this email into your records with the attached agreement. As you mentioned,we met the minimum threshold and MWDOC also executed the Agreement to put it into effect. At this time I do not see any need to get your signature. There is no consequence of not having you sign, because once the agreement was activated, it covers all of the agencies. Let me know if you need further information. Listed below are the signatories and the non-signatories. Attached is the form of the agreement with the 22 signatures. Thanks for following up. Karl Approval of the MWDOC Settlement Agreement 1. Irvine Ranch Water District 2. Santa Margarita Water District 3. EI Toro Water District 4. Emerald Bay Service District 5. Moulton Niguel Water District 6. South Coast Water District 7. City of Garden Grove 8. San Clemente 1 9. EOCWD 10. Serrano Water District 11. Huntington Beach. 12. Seal Beach 13. Tustin 14. Laguna Beach CWD 15. Mesa Consolidated WD 16. City of La Palma 17. City of Orange 18. City of Westminster 19. City of Buena Park 20. City of Fountain Valley 21. City of Brea 22. City of Newport Beach Not signing 23. Trabuco Canyon WD 24. City of San Juan Capistrano 25. La Habra 26. OCWD 27. YLWD 28. Golden State Water Company From: Justin Kirk FinaiIto:]Kirk@sanjuancapistrano.org] Sent: Wednesday, August 01, 2012 2:07 PM To: Karl Seckel Cc: Keith Van Der Maaten; West Curry Subject: Agreement Between MWDOC and Its Member Agencies on Budget, Activities, Charges, and Other Issues Good Afternoon Karl, I am in the process of completing a series of outstanding follow up items relating to Council actions. One of the pending items is obtaining the signature of the Mayor on the Agreement Between MWDOC and Its Member Agencies on Budget,Activities, Charges, and Other Issues.The Utilities Department had presented to the City Council the amended agreement (dated 12-14-10) on April 19, 2011 and the City Council took action to approve the agreement. My understanding was upon approval of the agreement by a specific percentage of the member agencies (75% 1 believe), the MWDOC board was to take action on the agreement. Subsequent to their action the final agreement was to be routed to the member agencies to obtain the signature of the authorized Council or Board member. I do not recall receiving the final agreement, and in discussion with the Clerk's office they have not received it either. Could you please forward the final agreement or let me know of the more appropriate contact person to obtain the document from? Thank you as always for your continued help. Regards, Jug(& A-xk Senior Management Analyst Utilities Department City of San Juan Capistrano 2 Amended 12- 1410 AGREEMENT BETWEEN MWDOC AND ITS MEMBER AGENCIES ON BUDGET, ACTIVITIES , CHARGES , AND OTHER ISSUES This Agreement is made by and between the Municipal Water District of Orange County (" MWDOC") and those of its 28 Member Agencies that have signed below ( referred to collectively as " Member Agency Parties" and individually as " Member Agency Party") . Signatories to this Agreement are also referred to herein collectively as " Parties" and individually as " Party . " This Agreement is effective as of the Effective Date established pursuant to Section 12 . 1 below . RECITALS WHEREAS , MWDOC is a wholesale water provider to 28 Member Agencies in Orange County , California ; and WHEREAS , MWDOC is a member agency of the Metropolitan Water District of Southern California (" MET") and appoints four (4) directors to MET's Board of Directors , and Whereas , MWDOC was formed in 1951 by Orange County voters to provide imported water from MET into Orange County ; and Whereas , MWDOC has been performing this function and many other functions since its formation in support of Member Agencies within its service area ; and Whereas , MWDOC was formed and operates pursuant to the Municipal Water District Law of 1911 (Water Code Section 71000 et seq . ) and is governed by a seven - member publicly elected Board of Directors ; and , Whereas , an essential area of MWDOC's authority includes the setting of rates for water commodities and services , and while rates may be different for different classes or conditions of service , they shall be uniform for like classes and conditions of service (Water Code § 71614) ; and , Whereas , an essential area of MWDOC's authority includes representing the Member Agencies at MET to ensure that the approximately $ 140 million paid to MET each year by MWDOC is used effectively and efficiently ; and , Whereas , in addition to its role at MET , MWDOC's regional services to its Member Agencies currently include water use efficiency programs , water supply planning activities to improve reliability and emergency preparedness , the Water Emergency Response Organization of Orange County ("WEROC") , the school education program , and numerous other programs ; and 1 Amended 12 - 14- 10 Whereas , in support of these services to its Member Agencies , MWDOC seeks grant funding for its programs , engages lobbyists on the Federal , State and local levels , and operates a public affairs department that serves its Member Agencies and their customers ; and Whereas , MWDOC's budget and rates have been the subject of discussion between MWDOC and some of its Member Agencies over the past several years , and these Member Agencies have raised concerns over whether the rate structure is equitable and whether a Member Agency should be able to opt out of certain services if it provides those services ; and Whereas , in conjunction with the preparation by the Orange County Local Agency Formation Commission ("OCLAFCO") of its 2007 Municipal Services Review and Sphere of Influence for MWDOC , MWDOC and several of its Member Agencies from southern Orange County participated in a series of "stakeholder" discussions facilitated by OCLAFCO in an attempt to resolve these and other concerns ; and Whereas , following approval by Orange County LAFCO of the 2007 Municipal Services Review and Sphere of Influence for MWDOC , OCLAFCO retained a consultant to conduct a study of "governance options" for MWDOC ("Governance Study") , which Study was funded 50% by MWDOC and 50 % by six of its Member Agencies from southern Orange County ; and Whereas , the same six Member Agencies , namely EI Toro Water District , Trabuco Canyon Water District , Santa Margarita Water District, Irvine Ranch Water District, Moulton Niguel Water District and South Coast Water District , have issued a "White Paper" regarding the formation of a "South Orange County Water Authority" that discusses issues associated with formation of such an agency if certain changes in MWDOC's operations are not made ; and Whereas , the Governance Study recommended the addition of three Member Agencies into the Study effort -- the City of San Clemente , the City of San Juan Capistrano and Laguna Beach County Water District, thereby bringing the total number of " South County Agencies" to nine ; and Whereas , the other Member Agencies of MWDOC are the City of Brea , City of Buena Park , City of Fountain Valley , City of Garden Grove , City of Huntington Beach , City of La Habra , City of La Palma , City of Newport Beach , City of Orange , City of Seal Beach , City of Tustin , City of Westminster, East Orange County Water District , Emerald Bay Services District , Golden State Water Company (" GSWC") , Mesa Consolidated Water District , Orange County Water District , Serrano Water District, and Yorba Linda Water District . Whereas , Emerald Bay Services District boundaries are located in the southern Orange County area and has requested to be included as a South County Agency , as hereinafter defined for purposes of this agreement ; and Whereas , the Parties signing below have reached a comprehensive agreement , memorialized herein ("Agreement") , that accommodates the interests of all 2 Amended 12- 14- 10 Parties , maintains MWDOC as the wholesale regional planning agency and promotes a cooperative and collaborative partnership between MWDOC and its Member Agencies ; NOW, THEREFORE , THE PARTIES ACKNOWLEDGE AND AGREE AS FOLLOWS : 1 . DEFINITIONS 1 .1 "South County Agencies , " as referenced in the recitals above , refers collectively to City of San Clemente , City of San Juan Capistrano , EI Toro Water District , Irvine Ranch Water District, Laguna Beach County Water District, Moulton Niguel Water District, Santa Margarita Water District, South Coast Water District , Trabuco Canyon Water District and Emerald Bay Services District. 1 .2 " Member Agencies" refers to any . and all entities , public or private , that purchase water from MWDOC . " Member Agency Parties" refers to Member Agencies who have signed this Agreement . 1 .3 " North County Agencies" as referenced in the Recitals above refer collectively to Member Agencies (other than the South County Agencies) , including the City of Brea , City of Buena Park, City of Fountain Valley , City of Garden Grove , City of Huntington Beach , City of La Habra , City of La Palma , City of Newport Beach , City of Orange , City of Seal Beach , City of Tustin , City of Westminster, East Orange County Water District, District, Golden State Water Company, Mesa Consolidated Water District , Orange County Water District, Serrano Water District, and Yorba Linda Water District . 2. MWDOC BUDGET 2 . 1 Core and Choice Services . Commencing in Fiscal Year 2011 - 2012 , MWDOC will organize its budget according to "Core" services and "Choice" services . (See Section 4 below regarding designation of specific services as Core and Choice . ) 2 . 1 . 1 The Core services budget shall include services identified by MWDOC as services that are both essential to its mission and carried out on behalf of the entire MWDOC service area for all 28 Member Agencies . The Core services also include services that MWDOC determines cannot practicably or efficiently be budgeted and charged to individual Member Agencies on an agency-by-agency basis . 3 L '4 Amended UmU1 10 2 . 1 .2 Choice services shall be budgeted , described , and priced in a manner that is intended to allow individual Member Agencies to decide whether to receive such services from MWDOC . MWDOC 's costs for Choice services provided , including related Overhead costs , will be recovered only from the MWDOC Member Agencies electing to receive the service . 2 . 1 . 3 Once Core and Choice services are established for the purpose of the Fiscal Year 2011 -2012 budget , those designations and their associated cost allocations shall thereinafter be presumed reasonable and appropriate ; and such designations and cost allocations will be used by MWDOC in its budgeting in subsequent years , subject to Paragraph 5 . 3 below . The designation of any new or different services to be offered by MWDOC as Core or Choice will be made at the time the services are considered for approval by the MWDOC Board and will be subject to input from the Member Agencies during the review process described below . 2 . 2 Review of Budget. MWDOC will continue its practice of soliciting and considering review and input on its budget from all MWDOC Member Agencies commencing in December and developing a conceptual draft budget for Member Agency review the following January . On or before March 1St of each calendar year, MWDOC shall publish its draft budget and shall solicit comments from Member Agencies . Each Member Agency shall indicate to MWDOC in writing by March 15th of each year if any changes in the Choice Services they will be participating in are being considered or are to be deleted as a Choice Service (some services , such as the South Orange Coastal Ocean Desalination Project, have existing contractual commitments that differ from fiscal year commitments) . In the absence of such timely notification of changes by the Member Agencies , the Member Agencies will be deemed to be participating without change in those Choice services in the following budget year to the same extent that the Member Agencies are participating in such Choice Services as of March 15 , Member Agencies desiring to submit formal comments on the budget shall deliver such formal comments to MWDOC before April 15th . (See Section 6 . 1 below , " Elected Officials ' Meeting . ") These comments will be considered in preparation of the final Budget and will be presented to the MWDOC Board in May . The Parties acknowledge that the MWDOC Board is solely responsible for final approval and establishment of the MWDOC Budget and all rates and charges . 4 Amended VmU1 10 r 3. MWDOC'S RESERVES 3 . 1 Purpose . MWDOC's Reserves allow it to meet operating and emergency financial requirements for operation of the District , including cash flow for managing grants and such expenses as future building improvements , Other Post Employment Benefits (OPEB) , unforeseen emergencies , potential litigation , and MWDOC elections . 3 .2 Reserve Line Items . MWDOC adopted a Reserve Policy on June 16 , 2010 , as outlined in the chart below. MWDOC will segregate its reserves into these categories and will report on the levels each year during the budget preparation process : MWDOC Proposed Reserves as of June 30, 2010 Reserve Category Proposed Amount General Reserves $ 1 , 850 , 000 ( Unrestricted Reserve ) Grant/WUE Cash flow $ 1 , 000 , 000 ( Designated Reserve) Election Expense ( Designated $ 500 , 000 Reserve) Building Repair/Replacement $ 350 . 000 ( Designated Reserve) Total Designated or $ 3 , 700 , 000 Unrestricted OPEB Reserve $ 500 , 000 ( irrevocable Trust -- Restricted) 5 Amended UA4- 10 4. MWDOC CHOICE SERVICES MWDOC shall institute a budgeting process in accordance with Section 2 above based on a designation of certain MWDOC services as Core services and other MWDOC services as Choice services . For the purposes of this Agreement and the MWDOC 2011 -2012 Budget, the designation of Core and Choice services and Overhead costs are identified in Table A, attached . (See 5 . 3 below . ) Input to any proposed changes in the designations shall be solicited from the Member Agencies in the annual budget preparation process in accordance with Section 2 . 2 above . 4. 1 Designation of Choice Services , The Choice categories identified at this time are described below . During the first half of fiscal year 2010- 11 , MWDOC Staff and the Member Agencies will work together to develop the concept , structure , budget and participation terms for the following services and any others identified for implementation beginning July 1 , 2011 These will be developed in such a way as to be offered to the Member Agencies for participation and will be incorporated into the proposed budget for 2011 - 12 . 4. 1 . 1 Project Participation Committees 4. 1 . 1 . 1 South Orange Coastal Ocean Desalination Proiect will continue to be organized in a Project Participation format with five agencies participating on an equal cost-sharing basis . The participating agencies will ultimately determine all institutional , financing and delivery issues for the project . 4 . 1 . 1 .2 Poseidon Huntington Beach Ocean Desalination Project is currently organized in a Project Participation format with 23 agencies participating on an equal cost-sharing basis . The costs to date for outside consulting have been paid for by Poseidon , so no local costs have been paid by the agencies . 4 . 1 . 2 MWDOC Member Agency Agreements 4 . 1 . 2 . 1 School Program will be organized with each Member Agency participating and paying its share of costs on a per student basis , and this Program also includes as participants the non-Member Agency cities of Anaheim , Fullerton , and Santa Ana . 6 Amended 12- 14- 10 4 . 1 . 2 . 2 Water Use Efficiency Program will be developed as a pay-as-you-go or a pay-for-participation basis instead of a "choice" basis . Functionally, however, there will be "choice" programs offered to all Member Agencies by agreement or through direct participation by retail consumers or others in the water service area . The Parties anticipate that the terms for the agreements between MWDOC and the Member Agencies will range between 3 and 5 years . The eight programs currently in operation include : Residential clothes washers • Sprinkler nozzles • SmarTimers • CII Plumbing Fixtures Synthetic Turf • Hotel Program Industrial Program Landscape Certification Program 4. 2 Right to Submit Proposal . If a Member Agency Party does not participate in a MWDOC Choice Service pursuant to the provisions of this Agreement, including Section 2 above , and desires to participate in a substantially similar Service from another Member Agency Party , as set forth in a written proposal , such Member Agency Party shall deliver to MWDOC , no later than March 15th of each year, a copy of the written proposal to receive such Service . MWDOC shall have thirty (30) days from receipt of such proposal to submit a scope and cost to provide the Service , for the Member Agency Party's consideration . 4. 3 Core Programs shall be those listed in Table A . Any funding brought in via MWDOC efforts from its State or Federal advocacy efforts , except for those specifically being funded through a Project Participation Agreement , shall be available to all MWDOC Member Agencies via Core or Choice Programs , e . g . , such as the Water Use Efficiency Program . 4.4 Overhead Costs shall be those listed in Table A. The Overhead costs are allocated over all Core and Choice services . Subject to Paragraph 5 . 3 , if activities are ever added to or removed from the 7 Amended 12- 1410 list of Core or Choice services , the commensurate proportion of Overhead costs will also be allocated accordingly . The determination of the Overhead cost percentage applicable to each Core and Choice service for any particular year shall be made during the budget preparation process and fixed for the entire budget year. 5. REVENUE COLLECTION The Parties agree that -MWDOC should transition its current rate structure , which includes both a per retail connection charge and a per acre-foot charge , to a structure that includes only a per retail connection charge . Currently , MWDOC's revenue from water rate charges is approximately 65% on the per retail connection charge and 35% on the per acre-foot charge . As described below , MWDOC shall increase the percentage on the per retail connection charge gradually , reaching 100 % in fiscal year 2015- 16 . 5. 1 Fixed Charges . Commencing in fiscal year 2011 -20121 MWDOC will begin transitioning to a 100% fixed charge . In the first year of this process , 80% of MWDOC's water rate charges for its operating budget will be fixed , and 20 % will be water charges . Each year for the next four years , MWDOC will increase the amount on fixed charges by 5 % . 5.2 Method of Fixed Charges . MWDOC will continue to use the methodology in effect as of the Effective Date to define retail service connections independent of size as the method of passing charges to the Member Agencies on a fixed charge basis . 5.3 Designation of Core , Choice , and Overhead Services . The designations of services and activities set forth in ( i) Section 2 . 1 and Table A for Core and Choice Service , in ( ii) Paragraph 4 .4 and Table A for Overhead Costs , and in ( iii) Paragraph 5 . 2 for Method of Fixed Charges , shall carry a presumption of reasonableness and , therefore , shall remain unchanged for the term of this Agreement, unless changed by amendment in accordance with the provisions of Section 15 . 8 1 Amended 12- 1410 6 . INTERACTION OF ELECTED OFFICIALS 6 . 1 Elected Officials' Meeting . MWDOC will hold a semi-annual meeting for elected representatives of the Member Agencies and a GSWC officer or the officer's designee in October and April (" Elected Officials' Meeting ") in addition to any other meetings , workshops , or assemblies open to those officials . The meetings shall be chaired by the President of the MWDOC Board and it is the intent of the Parties that the primary attendees shall be members of their respective governing bodies . The forum will be used to discuss : MWDOC activities , policies , and budget (including reserves) MET activities and policies Statewide water resource issues Strategies to increase Orange County's water supply reliability and to minimize Orange County water costs Other topics of significant interest to the Orange County water community Beginning in March 2011 and each year thereafter, upon completion of the first DRAFT of the MWDOC Budget for the upcoming year, MWDOC will formally request comments on the budget from all 28 Member Agencies , as described in Section 2 . 2 above . MWDOC will report on the budget comments received from the Member Agencies at the Elected Officials' Meeting described herein . 6 . 2 Public Meetings , The Elected Officials' Meetings shall be noticed public meetings of MWDOC 's Board . Each Member Agency participating in these meetings shall be responsible for compliance with the Brown Act by its own legislative body . (Government Code § 54950 etseq . ) 7 . SELECTION OF MET DIRECTORS 7 . 1 Recommended Appointments by MWDOC Member Agency Parties . Commencing with the first vacant MWDOC MET Director position following the Effective Date , the MWDOC Board will institute and follow the procedure set forth in this Section 7 for appointing MET Directors . 9 Amended 12- 14- 10 751 91 The MWDOC Administrative Code provides that the Board President shall nominate and the Board shall approve MET Directors . j 7 . 1 . 2 Under the conditions and procedures established in this Agreement , the MWDOC Board will delegate limited nominating power to the MWDOC Member Agencies for two of MWDOC 's MET Director positions . 7 . 1 . 3 When the first MET Director vacancy occurs following the Effective Date , the South County Agencies that are Member Agency Parties ("South County Parties") may nominate a candidate of their choosing (" MET Candidate") through a process to which they all agree , directly to the MWDOC President and Board . In the absence of agreement among the South County Parties , the nomination(s) shall be determined by a "one agency , one vote" process among the South County Parties . Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the South County Parties . Once filled , that seat will be designated , pursuant to this Agreement, as the "South County Seat" . 7 . 1 . 4 When the second MET Director vacancy occurs following the Effective Date , the North County Agencies that are Member Agency Parties (" North County Parties") may nominate a MET Candidate of their choosing , through a process to which they all agree , directly to the MWDOC President and Board . In the absence of agreement among the North County Parties , the nomination (s) shall be determined by a "one agency , one vote" process among the North County Parties. Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the North County Parties . Once filled , that seat will be designated , pursuant to this Agreement, as the " North County Seat" . 7 . 2 The MWDOC Board shall consider each nominated MET Candidate seriously , in good faith and in the spirit of this Agreement and can only reject said MET Candidate for cause . The remaining MET Director seats shall continue to be filled pursuant to MWDOC's Administrative Code . MWDOC shall continue its practice of advising the Member Agencies when a vacancy occurs and soliciting potential candidates and input from all Member Agencies for filling these seats . 7 . 3 All MWDOC MET Directors shall serve for an indefinite term pursuant to the MWDOC Administrative Code ; provided , however, a MWDOC MET Director holding the North County Seat or the South County Seat may be removed by MWDOC only after MWDOC has convened an ad hoc committee to review that MWDOC MET Director's performance and the ad hoc committee has solicited and considered the input of the respective nominating area as provided below . If a vacancy occurs in the North County Seat or the South County Seat, the North or South County Parties , as established herein , may make subsequent nominations to fill the vacancy in accordance with Sections 7 . 1 . 3 and 7 . 1 . 4 , as applicable . The MWDOC Board President shall 10 Amended 12- 14- 10 consider appointment of an ad hoc committee to review the performance of MWDOC 's MET Directors upon request of any MWDOC Board Member or Member Agency , or upon the MWDOC President's own determination . Such review , if any , may be conducted no more than once annually . If appointed , the ad hoc committee shall solicit input from the respective nominating areas on the performance of the North County and South County I nominated MET Directors . Should the North County Parties or South County Parties deem it appropriate to remove their selected MET Director, they can make their request for removal to the MWDOC Board . The MWDOC Board will not unreasonably withhold action on such request(s) . 8 . COMPLIANCE WITH MWDOC ADMINISTRATIVE CODE Any MET Candidate nominated and appointed as provided herein must be familiar with MWDOC's Administrative Code and express a willingness to comply with it. This includes , without limitation , meeting the criteria for a MWDOC MET Director established in Section 1500 of the MWDOC Administrative Code . 9. COMPLIANCE WITH LAW i The nomination and appointment of any MET Candidate , as provided herein , must comply with applicable statutory and case law . 10. MET DIRECTOR ORANGE COUNTY CAUCUS MWDOC will schedule and conduct at its offices regular meetings of the MET Directors representing MET Member Agencies in Orange County . Meetings will be scheduled at least three (3) times per year to be determined by the Orange County MET Directors at the first meeting each year. The purpose of the meetings is to provide special access by all Member Agencies to the MET Directors representing Orange County . 11 . REMEDIES AND ENFORCEMENT 11 . 1 Remedies in General . Except as set forth below , each Party shall have all remedies otherwise available to enforce the terms of the Agreement and to seek remedies for any breach hereof, including but not limited to the remedies set forth in Sections 11 . 2 . 3 , 11 . 5 and 11 . 6 of this Agreement . 11 .2 Breach of the Agreement. 11 1 Amended 12- 14- 10 11 .2. 1 Any material breach or material violation of the Agreement shall be deemed a default under this Agreement. 11 .2 . 2 In the event of an alleged material breach or material violation of the Agreement , the Parties agree to work together in good faith to resolve any disagreement using the following dispute resolution process : 11 .2 .2 . 1 The Party alleging a breach shall notify the other Parties of the basis for the allegation and the requested cure for the breach . 11 .2 . 2 . 2 The alleged breaching Party receiving notice of breach shall have 15 calendar days to respond . If the response acknowledges that a breach has occurred , the breaching Party shall have 30 days to cure such breach , provided that if such breach cannot be reasonably capable of being cured within said 30-day period , then the breaching Party shall not be in default of this Agreement provided that the breaching Party is diligently continuing to cure such default . 11 . 2 . 2 . 3 If the Party alleging a breach and the alleged breaching Party disagree with respect to whether a breach has occurred , they shall meet and confer in good faith toward a mutually satisfactory solution . The meet and confer shall be open to all Parties . 11 . 2 . 2 .4 If the dispute cannot be resolved through the meet and confer process within 60 calendar days after the first meeting , the Party alleging a breach and the alleged breaching Party , along with any other Party that wishes to participate , shall engage in third party mediation , with the participating Parties to equally share mediation costs . Said mediation shall end no later than 90 calendar days after the completion of the original meet and confer process . No Party may file a lawsuit concerning the alleged breach until the mediation has ended . 11 . 2 . 2 . 5 In the event a lawsuit is filed after completion of the mediation concerning the alleged breach , the Parties' rights and obligations under this Agreement shall continue until one of three actions occurs . ( 1 ) the agreement continues as drafted ; (2) the agreement is terminated ; or (3) an amendment to the agreement is entered into pursuant to Section 15 . 11 . 2 . 3 Any Party to this Agreement may , in addition to any other remedy, seek an order from a court specifically enforcing the 12 1 Amended 12- 1410 obligations of the Parties to the Agreement to comply with this Section 11 . 2 . I 11 . 3 Material Breach in the Event of Certain Activities . The Parties to this Agreement have mutual interests in avoiding the time , expense , and uncertainty of either (a) legislative measures that would affect MWDOC's organizational form or (b) filing an application with the OCLAFCO for secession of a Party or detachment of a Party's territory from MWDOC . Consequently, the Parties to this Agreement agree that " material breach , " within the meaning of Section II . (a) shall include (but not be limited to) the following activities that any Party hereto may undertake during the term of this Agreement : 11 .3. 1 The submission of an application with OCLAFCO to reorganize or undertake an action that would result in a Party's secession or the detachment of all or a portion of a Party's territory, from MWDOC , or would result in any other material change in governance or structure affecting MWDOC . 11 .3 .2 The filing of any written letters or testimony with , or providing verbal testimony to , any committee or other body of the State Legislature in support of legislative measures that would (A) materially affect MWDOC's organizational form or change the governance of MWDOC , and (B) would result in secession or detachment of territory from MWDOC by any Member Agency . 11 .4 An action constituting a material breach under Sections 2 . 2 , 4 , 5 , 69 71 10 , or 11 . 3 shall be subject to the dispute resolution provisions of Section 11 . 2 . 2 . 11 .5 Enforcement. Any Party may enforce compliance by a defaulting Party with the terms of this Agreement by , among other available remedies : 11 .5. 1 Filing a complaint for specific performance ; 11 m502 Filing an action to recover actual damages to which the notifying Party may be entitled for violation by the defaulting Party of the terms of this Agreement ; 11 .5 .3 Filing an action to enjoin the violation , on an ex parte basis if necessary , by temporary or permanent injunction , without the necessity of proving either actual damages or the inadequacy of otherwise available legal remedies , or for other equitable relief, 13 o Amended 12- 14- 10 11 .5 .4 Petitioning for a writ of ordinary or administrative mandate ordering the defaulting Party to cure , and/or 11 .5 . 5 Petitioning for a writ of ordinary or administrative mandate ordering OCLAFCO not to process an application filed in contravention of this Agreement . 111A Injunctive and Temporary Relief Appropriate. The Parties acknowledge that breach of this Agreement may not be adequately remedied by monetary damages and could result in irreparable harm to the aggrieved Parties . Therefore , injunctive and temporary relief may be appropriate to ensure compliance with the terms of this Agreement . 12. TERM OF AGREEMENT 12.1 Effective Date , This Agreement shall be effective upon the date of execution by MWDOC , which shall execute the Agreement upon express approval of its Board (" Effective Date") . MWDOC shall inform all Parties by e-mail when that event occurs . 12.2 Subsequent Execution , Any Member Agency that executes this Agreement after the Effective Date shall , upon execution , become a full Party to the Agreement , with all the rights and obligations set forth herein . 12 . 3 Termination Date, This Agreement shall run for a term of five (5) years from the Effective Date , unless terminated as provided herein. This agreement may be extended by mutual agreement of all of the Parties hereto for subsequent term(s) five (5) years , or other period as mutually agreed to at the time of the extension . 13 . OBLIGATIONS OF MEMBER AGENCIES 13.1 No OCLAFCO Application . During the term of this Agreement, none of the Member Agency Parties shall prepare , hire a consultant to prepare , or submit an application to OCLAFCO requesting reorganization or any action that would result in detachment of any territory from MWDOC or any other change affecting the governance , structure , or finances of MWDOC , unless agreed to in writing by MWDOC . In the event that the OCLAFCO undertakes proceedings , whether in response to an application or pursuant to its own discretionary powers , that reduces the territory within the boundaries or affects or changes the governance , structure or finances of MWDOC , these proceedings shall be considered a material breach of this Agreement by the Party or 14 Amended 12- 14- 10 Parties filing , supporting or in any way furthering the application except to the extent their actions are required by law. 13.2 No Legislative Activities . During the term of this Agreement, none of the Member Agency Parties shall pursue , support , or further any legislative measures that would affect MWDOC 's organizational form , board or staff members , finances , exercise of powers , or governance or result in detachment of any territory from MWDOC , unless agreed to in writing by MWDOC . 13.3 Participation in Agreement. During the term of this Agreement , the Member Agency Parties , and each of them , shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement . 14. OBLIGATIONS OF MWDOC 14. 1 No OCLAFCO Application . During the term of this Agreement , MWDOC shall not prepare , hire a consultant to prepare , or submit an application to OCLAFCO as described in Paragraph 13 . 1 relating to the governance , structure , or finances of MWDOC or any equivalent OCLAFCO application relating to the governance , structure , or finances of any of its Member Agencies , unless agreed to in writing by the affected Member Agency , 14. 2 No Legislative Activities . During the term of this Agreement, MWDOC shall not pursue , support, or further any legislative measures that would affect any Member Agency's organizational form , board or staff members , finances , exercise of powers , or governance or result in detachment of any territory from the Member Agency, unless agreed to in writing by the Member Agency . 14. 3 Participation in Agreement. During the term of this Agreement, MWDOC shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement . 15. AMENDMENT OF AGREEMENT 15.1 Any amendment, alteration , or variation of any provision of this Agreement ("Amendment") will not be valid unless made in writing and approved as provided in this Section . 15.2 The Parties acknowledge that the process of obtaining initial approvals and execution of this Agreement has required a substantial investment of public resources and time and that the same process should not be required for subsequent Amendments to the Agreement that are proposed without objection . For this reason , Amendments to the Agreement may be made as provided in this section . 15 .2. 1 An Amendment to the Agreement proposed by MWDOC shall be distributed by MWDOC to all Parties signing this 15 Amended 12- 14- 10 Agreement for a 60-day review period . 15 .2 .2 Any and all comments and objections to the Amendment shall be provided by the Parties to MWDOC and the remaining Member Agency Parties before the conclusion of the 60-day review period . 15 . 2 . 3 If no objections are received by the conclusion of the 60-day review period , the Amendment shall be valid and binding on the Parties . Upon this occurrence , MWDOC will provide a copy of the Amendment to all Parties . 15 . 2 .4 If any objections are received within the review period , MWDOC may submit the proposed Amendment to the Parties for signatures , and if the proposed Amendment is executed by MWDOC and all of the Member Agency Parties , the Amendment shall be valid and binding on the Parties . Upon this occurrence , MWDOC will provide a copy of the Amendment to all Parties . 15:3 An Amendment to the Agreement proposed by a Party other than MWDOC shall be submitted in writing to MWDOC . Upon receipt of the proposed Amendment , MWDOC shall then follow the procedures set forth in section 15 . 2 above . 16 . NO ADMISSION BY ANY PARTY The Parties acknowledge that statements made by the Parties during negotiation of this Agreement, statements made in this Agreement, and all rights and obligations that arise from this Agreement were and are in furtherance of the goal of resolving issues between the Parties without the need for administrative or judicial proceedings , including possible OCLAFCO proceedings and litigation . Neither any statement made during negotiation of this Agreement nor any provision of the Agreement itself shall constitute an admission by a Party or be offered as evidence or included in any record of proceedings in any future administrative or judicial proceeding . 17. GENERAL PROVISIONS 17 . 1 All Parties are deemed to have participated in the drafting of this Agreement, and any rule of law (including , but not limited to , Civil Code Section 1654) or legal principle that would require interpretation of this Agreement against the drafter hereto shall not apply and is waived by the Parties . This Agreement may be signed in multiple counterparts for convenience of the Parties . 17.2 This Agreement will inure to the benefit of and be binding upon all Parties and their respective successors and assigns . 17 . 3 This Agreement will be deemed a contract made under the laws of 16 Amended 12- 14- 10 the State of California and for all purposes will be interpreted in accordance with such laws . The Parties hereby agree and consent to the exclusive jurisdiction of the courts of the State of California . 17 .4 This Agreement constitutes the entire agreement among the I Parties . This Agreement supersedes any and all other understandings or agreements , either oral or in writing , among the Parties with respect to the subject matter hereof and contains all of the covenants and agreements among them with respect to said matters ; and each Party acknowledges that no representation , inducement, promise of agreement , oral or otherwise , has been made by any other Party or anyone acting on behalf of any other Party that is not embodied herein . 17 . 5 If any action at law or equity , including any action for writ of mandate or injunctive relief, is brought to enforce or interpret the provisions of this Agreement , the prevailing Party( ies) shall be entitled to its or their reasonable attorney's fees and costs as against the Party(ies) that did not prevail in that action or proceeding . 17 . 6 All activities undertaken pursuant to this Agreement must be in compliance with all applicable state and federal laws and regulations . I 17 . 7 In the event one or more of the provisions contained in this Agreement is held invalid , illegal or unenforceable by any court of competent jurisdiction , such portion shall be deemed severed from this Agreement and the remaining parts of this Agreement shall remain in full force and effect as though such invalid , illegal , or unenforceable portion had never been a part of this Agreement . 17 .8 All communications set forth in this Agreement shall be in writing and transmitted to and among the Parties in a manner that is consistent with the custom and practice of MWDOC and its Member Agencies then in effect. Any computations of time shall start from 5 : 00 PM on the day of receipt . i IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the respective dates shown below. Mayor, City of San Clemente Date 17 Amended 12- 14- 10 Mayor, City of San Juan Capistrano Date Ted F . Martin , President Date EI Toro Water District 18 n Amended 12 - 14- 10 fA ; President, Irvine Ranch Water District Date President, Laguna Beach County Water District Date President, Municipal Water District of Date Orange County President, Moulton Niguel Water District Date President, Santa Margarita Water District Date President, South Coast Water District Date 19 Amended 12- 14- 10 President, Irvine Ranch Water District Date I President, Laguna Beach County Water District Date 3 i President, Municipal Water District of Date Orange County I i President, Moulton Niguel Water District Date I President, Santa Margarita Water District Date i i President, South Coast Water District Date i i i 19 Amended 12- 14 - 10 President , Irvine Ranch Water District Date President , Laguna Beach County Water District Date P sident , Municipal Waterdhistrici of Date Orange County I President, Moulton Niguel Water District Date President , Santa Margarita Water District Date President, South Coast Water District Date 19 Amended 12- 14- 10 President, Irvine Ranch Water District Date President, Laguna Beach County Water District Date President , Municipal Water District of Date Orange County I President M Ito uela t r Dist ict Date President, Santa Margarita Water District Date President, South Coast Water District Date i I i w J i 19 Amended 12A4- 10 President, Irvine Ranch Water District Date I President, Laguna Beach County Water District Date President, Municipal Water District of Date Orange County President, Moulton Niguel Water District Date 0y � � sident , Santa Mgarita Water District Date President, South Coast Water District Date i 19 Amended 12 - 14- 10 President, Irvine Ranch Water District Date President, Laguna Beach County Water District Date President, Municipal Water District of Date Orange County President , Moulton Niguel Water District Date President, Santa Margarita Water District Date President , Sou oast Water D' ict Date 19 Y FINAL - 9 - 17 - 10 President , Trabuco Canyon Water District Date f 4 J ayo , City of Brea Date Mayor , City of Buena Park Date I I Mayor , City of Fountain Valley Date Mayor , City of Garden Grove Date Mayor , City of Huntington Beach Date 20 Amended 12- 14- 10 President, Trabuco Canyon Water District Date Mayor, City of Brea Date ayo , it uena Par Date Mayor, City of Fountain Valley Date Mayor, City of Garden Grove Date i Mayor, City of Huntington Beach Date i { 20 Amended 12- 14- 10 17 . 7 In the event one or more of the provisions contained in this Agreement is held invalid , illegal or unenforceable by any court of competent jurisdiction , such portion shall be deemed severed from this Agreement and the remaining parts of this Agreement shall remain in full force and effect ' as though such invalid , illegal , or unenforceable portion had never been a part of this Agreement . 17 . 8 All communications set forth 1n this Agreement shall be in writing and transmitted to and among the Parties in a manner that is consistent with the custom and practice of MWDOC and its Member Agencies then in effect. Any computations of time shall start from 5 : 00 PM on the day of receipt . IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on . the respective dates shown below . ATTEST : CITY OF FOUNTAIN VALLEY City Jerk Mayor APPROVED AS TO FORM : MUNICIPAL WATER DISTRICT OF ORANGE COUNTY City Attorney Toan C . Finnegan , President ZAUsers Data\ggoodreau\MWDOC\3381afcoissues\agmts\MWDOCAgreement markup 11 ~11 ~ 10finaI docx121410rgb .docx 19 f 1 Amended 12- 14- 10 President, Trabuco Canyon Water District Date Mayor, City of Brea Date Mayor, City of Buena Park Date Mayor, City of Fountain Valley Date Mayor, City of Garden Grove Date ITOi Attest : Kathy Bailor , City Clerk Mayor, City of Huntington Beach Date 20 Amended 12 - 14- 10 President, Trabuco Canyon Water District Date E P Mayor, City of Brea Date Mayor, City of Buena Park Date Mayor, City of Fountain Valley Date Mayor, City of Garden Grove Date Joe Carc io Mayor ntington ch Date March 8 , 2011 APPROVED TO FORM JENNIFER cGRATH, City Attorney B D'Alessandro Z/a sistant City Attorney 20 Amended 12- 14- 10 Mayor, City of La Habra Date f 04 / 05 / 11 Mayop,FCity of La Palma Date Ralph D . Rodriguez Mayor, City of Newport Beach Date i Mayor, City of Orange Date Mayor, City of Seal Beach Date Mayor, City of Tustin Date 21 Amended 12 -14- 10 Mayor, City of La Habra Date Ii f I Mayor, City of La Palma Date Mayor, City of Newport Beach Date Mayor, City of Orange Date I Mayor, City of Seal Beach Date Mayor, City of Tustin Date NSW O� m ATTEST : City Attorney LVO 21 A( BY : Leilani Brown ` City Clerk Amended 12- 14- 10 Mayor, City of La Habra Date I I Mayor, City of La Palma Date Mayor, City of Newport Beach Date WC:' ge Date Mayor , City of Seal Beach Date Mayor , City of Tustin Date APPROVED A3 TO FORM: DA ; �Yt 21 � .. cm► aTro �r Amended 12A4- 10 Mayor, City of La Habra Date Mayor, City of La Palma Date Mayor, City of Newport Beach Date Mayor, City of Orange Date 6$40& Michael P . Levitt March 14 , 2011 Mayor, City of Seal Beach Date Mayor, City of Tustin Date 21 Amended 12- 14- 10 as though such invalid , illegal , or unenforceable portion had never been a part of this Agreement . 17 . 8 All communications set forth in this Agreement shall be in writing and transmitted to and among the Parties in a manner that is consistent with the custom and practice of MWDOC and its Member Agencies then_ in effect. Any computations of time shall start from 5 : 00 PM on the day of receipt . IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the respective dates shown below. " CITY" C TUSTIN erry e , Mayor ATTEST : ( SEAL) Pamela Stoker, Ci y derk APPROVED AS TO FORM . Dougl s C . Hol and , City Atto ney 19 I . Amended 12A4- 10 I / r� Mayor, City of Westminster Date �— President, East Orange County Water District Date I President, Emerald Bay Service District Date Officer, Golden State Water Company Date President, Mesa Consolidated Water District Date President, Orange County Water District Date 22 Amended 12- 14- 10 Mayor, City of Westminster Date A?,wevra as President, East Orange County Water District Date 7 / 1 i President, Emerald Bay Service District Date I Officer, Golden State Water Company Date President, Mesa Consolidated Water District Date i i I I I President, Orange County Water District Date 22 a Amended 12- 14- 10 Mayor, City of Westminster Date President, East Orange County Water District Date 11 Pr id t , Emerald a Service District Date Officer Golden State Water Company Date p Y President, Mesa Consolidated Water District Date President, Orange County Water District Date 22 Amended 12A4- 10 Mayor, City of Westminster Date President , East Orange County Water District Date I I I I President, Emerald Bay Service District Date i a ' Officer, Golden State Water Company Date t resident, Mesa Consolidated Water District Date President , Orange County Water District Date 22 Amended 12- 14- 10 Pre 'd , Serr Water District Date President, Yorba Linda. Water District Date i ZAUsers Data\ggoodreau\MWDOC\3381afcoissues\agmts\MWDOCAgreement markup11 � 11 ~ 10final docx121410rgb . docx 23 FINAL - 9 .17.10 Table A - MWDOC Breakdown of Services/Activities/Costs Gor`eServi°cdl 09146 Services. Overlie. ad_=Costs Board Compensation & Benefit Water Use Efficiency Salary charged to overhead Retiree Costs • Residential clothes washers function (vacation, sick leave Legal Costs • Sprinkler nozzles and holidays) Board ElectionsPersonnel development SmarTimers Legal costs charged to Accounting and General Admin CII Plumbing Fixtures overhead function MET Representation • Synthetic Turf Employee benefits • MET Director Support • Hotel Program Personnel/staff development • MET policy analysis, programs and special • Industrial Program Information technology projects • Landscape Certification Conference employee • MET operations, water rates and accounting program Travel & Accommodations Staff time for MWDOC ' s Water Use Efficiency Includes marketing materials for employee Programs Manager WUE activities, staff time, Governmental Affairs overhead and grant funds (MET Office mite ante ' /Toll and other Office maintenance • In-house staff for legislative info ) Governmental Relations Rents & Leases • WACO, ISDOC and other support Office supplies • Federal lobbyist for countywide funding Any project or program legislative or grant support Insurance expenses • State lobbyist for countywide legislative, grant on choice activities — Utilities — telephone funding and policy access Townsend Public Affairs Miscellaneous expenses • Local lobbyist for Board of Supervisors Specific Programs P g Professional fees for overhead Public Affairs • School program activities • Coordination with MET, other regional and local . South Orange Coastal Software support retailers Ocean Desal Project Computers/software • Basic communications functions-media outreach o • Federal lobbying and inquiries, water information and messaging, for SOCODP — MWDOC website Barker i • MWDOC newsletter (e-currents) o Federal lobbying • Countywide surveys as appropriate for SOCODP — • Countywide water awareness in coordination with Townsend retail agencies • Support for Poseidon Desal Research — support for Center for Demographic Project I Research Other Project specific Water Supply Planning studies • Coordination among agencies Non-countywide issue • Water use tracking and projections studies • Water supply analysis • Regulatory compliance issues • Water trends analysis i • Countywide studies j Water Emergency Response Organization of Orange County (WEROC) — MWDOC contribution 24 8/2/2011 AGENDA REPORT D9 TO: Karen P. Brust, City Manager ` FROM: William Curry, Assistant Utilities Department Director SUBJECT: Consideration of Participation in the Municipal Water District of Orange County's (MWDOC) School Education Program. RECOMMENDATION: By motion, elect to participate in MWDOC's School Program. SITUATION: During the April 19, 2011, City Council meeting, the City Council voted to approve an agreement between the Municipal Water District of Orange County and its member agencies regarding budget, activities, charges, as well as other issues. As part of this action the City Council elected to participate in several of the "choice" programs (South Orange county desalination and water use efficiency program), except for the MWDOC school program (see attachment 1, adopted agreement). This action anticipated that this program would be handled by existing staff at a cost savings. Since the inception of this program in 1973, the Capistrano Valley Water District and subsequently the City of San Juan Capistrano has participated in the school program. Other than minimal support, this program has been fully supported and conducted by MWDOC. Based upon current staffing levels this program would not be able to be continued without the continued support and management by MWDOC. This program has served the community as an educational tool to help in the conservation of water resources, and has been identified on the City's Best Management Practices for the California Urban Water Conservation Council. This resource is provided at shared cost with other MWDOC members (Moulton Niguel, City of San Clemente, and South Coast Water District) to a majority of primary education level children throughout the Capistrano Unified School District. The program is an instructional aid that provides grade specific educational programs that address the importance and scarcity of water, the water cycle, the three sources of water and the importance of water conservation. Through this partnership with MWDOC approximately nineteen hundred (1,900) elementary school children are able to participate in this program each year, within the City's water service area. The previously adopted agreement does not need to be amended as the agreement allows for member agencies to determine which choice programs they elect to participate in. Based upon the nominal associated costs and the significant value Agenda Report Page 2 August 2, 2011 achieved through this program, staff recommends that the City Council elect to participate in this program. COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: The Utilities Commission during their March 22, 2011, regular meeting by motion unanimously recommended approval of the proposed agreement and participation in all the elected choice programs including the School Education Program. No further review has occurred since Council action. FINANCIAL CONSIDERATIONS: The total cost of the elected School Program would cost $3,364.00 for fiscal year 11/12 and was included in the 11112 fiscal year budget. NOTIFICATION: Municipal Water District of Orange County (MWDOC) RECOMMENDATION: By motion, elect to participate in MWDOC's School Program. Respectfully s omitted, jJu p red b William Curry, in Kirk,Assistant Utilities Department Director for Mana ent Analyst Attachments: 1. Adopted Agreement Amended 12-14-10 AGREEMENT BETWEEN MWDOC AND ITS MEMBER AGENCIES ON BUDGET,ACTIVITIES, CHARGES,AND OTHER ISSUES This Agreement is made by and between the Municipal Water District of Orange County("MWDOC")and those of its 28 Member Agencies that have signed below (referred to collectively as "Member Agency Parties" and individually as "Member Agency Party"). Signatories to this Agreement are also referred to herein collectively as "Parties" and individually as "Party." This Agreement is effective as of the Effective Date established pursuant to Section 12.1 below. RECITALS WHEREAS, MWDOC is a wholesale water provider to 28 Member Agencies in Orange County, California; and WHEREAS, MWDOC is a member agency of the Metropolitan Water District of Southern California ("MET") and appoints four(4) directors to MET's Board of Directors, and Whereas, MWDOC was formed in 1951 by Orange County voters to provide imported water from MET into Orange County; and Whereas, MWDOC has been performing this function and many other functions since its formation in support of Member Agencies within its service area; and Whereas, MWDOC was formed and operates pursuant to the Municipal Water District Law of 1911 (Water Code Section 71000 et seq.) and is governed by a seven-member publicly elected Board of Directors; and, Whereas, an essential area of MWDOC's authority includes the setting of rates for water commodities and services, and while rates may be different for different classes or conditions of service, they shall be uniform for like classes and conditions of service (Water Code § 71614); and, Whereas, an essential area of MWDOC's authority includes representing the Member Agencies at MET to ensure that the approximately$140 million paid to MET each year by MWDOC is used effectively and efficiently; and, Whereas, in addition to its role at MET, MWDOC's regional services to its Member Agencies currently include water use efficiency programs, water supply planning activities to improve reliability and emergency preparedness, the Water Emergency Response Organization of Orange County ("WEROC"), the school education program, and numerous other programs; and 1 ATTACHMENT I Amended 12-14-10 Whereas, in support of these services to its Member Agencies, MWDOC seeks grant funding for its programs, engages lobbyists on the Federal, State and local levels, and operates a public affairs department that serves its Member Agencies and their customers; and Whereas, MWDOC's budget and rates have been the subject of discussion between MWDOC and some of its Member Agencies over the past several years, and these Member Agencies have raised concerns over whether the rate structure is equitable and whether a Member Agency should be able to opt out of certain services if it provides those services; and Whereas, in conjunction with the preparation by the Orange County Local Agency Formation Commission ("OCLAFCO") of its 2007 Municipal Services Review and Sphere of Influence for MWDOC, MWDOC and several of its Member Agencies from southern Orange County participated in a series of "stakeholder" discussions facilitated by OCLAFCO in an attempt to resolve these and other concerns; and Whereas, following approval by Orange County LAFCO of the 2007 Municipal Services Review and Sphere of Influence for MWDOC, OCLAFCO retained a consultant to conduct a study of "governance options"for MWDOC ("Governance Study"), which Study was funded 50% by MWDOC and 50% by six of its Member Agencies from southern Orange County; and Whereas, the same six Member Agencies, namely EI Toro Water District, Trabuco Canyon Water District, Santa Margarita Water District, Irvine Ranch Water District, Moulton Niguel Water District and South Coast Water District, have issued a "White Paper" regarding the formation of a "South Orange County Water Authority"that discusses issues associated with formation of such an agency if certain changes in MWDOC's operations are not made; and Whereas, the Governance Study recommended the addition of three Member Agencies into the Study effort--the City of San Clemente, the City of San Juan Capistrano and Laguna Beach County Water District, thereby bringing the total number of "South County Agencies" to nine; and Whereas, the other Member Agencies of MWDOC are the City of Brea, City of Buena Park, City of Fountain Valley, City of Garden Grove, City of Huntington Beach, City of La Habra, City of La Palma, City of Newport Beach, City of Orange, City of Seal Beach, City of Tustin, City of Westminster, East Orange County Water District, Emerald Bay Services District, Golden State Water Company ("GSWC"), Mesa Consolidated Water District, Orange County Water District, Serrano Water District, and Yorba Linda Water District. Whereas, Emerald Bay Services District boundaries are located in the southern Orange County area and has requested to be included as a South County Agency, as hereinafter defined for purposes of this agreement; and Whereas, the Parties signing below have reached a comprehensive agreement, memorialized herein ("Agreement"), that accommodates the interests of all 2 Amended 12-14-10 Parties, maintains MWDOC as the wholesale regional planning agency and promotes a cooperative and collaborative partnership between MWDOC and its Member Agencies; NOW,THEREFORE, THE PARTIES ACKNOWLEDGE AND AGREE AS FOLLOWS: 1. DEFINITIONS 1.1 "South County Agencies,"as referenced in the recitals above, refers collectively to City of San Clemente, City of San Juan Capistrano, EI Toro Water District, Irvine Ranch Water District, Laguna Beach County Water District, Moulton Niguel Water District, Santa Margarita Water District, South Coast Water District, Trabuco Canyon Water District and Emerald Bay Services District. 1.2 "Member Agencies" refers to any and all entities, public or private, that purchase water from MWDOC. "Member Agency Parties" refers to Member Agencies who have signed this Agreement. 1.3 "North County Agencies"as referenced in the Recitals above refer collectively to Member Agencies (other than the South County Agencies), including the City of Brea, City of Buena Park, City of Fountain Valley, City of Garden Grove, City of Huntington Beach, City of La Habra, City of La Palma, City of Newport Beach, City of Orange, City of Seal Beach, City of Tustin, City of Westminster, East Orange County Water District, District, Golden State Water Company, Mesa Consolidated Water District, Orange County Water District, Serrano Water District, and Yorba Linda Water District. 2. MWDOC BUDGET 2.1 Core and Choice Services. Commencing in Fiscal Year 2011- 2012, MWDOC will organize Its budget according to "Core" services and "Choice" services. (See Section 4 below regarding designation of specific services as Core and Choice.) 2.1.1 The Core services budget shall include services identified by MWDOC as services that are both essential to its mission and carried out on behalf of the entire MWDOC service area for all 28 Member Agencies. The Core services also include services that MWDOC determines cannot practicably or efficiently be budgeted and charged to individual Member Agencies on an agency-by-agency basis. 3 Amended 12-14-10 2.1.2 Choice services shall be budgeted, described, and priced in a manner that is intended to allow individual Member Agencies to decide whether to receive such services from MWDOC. MWDOC's costs for Choice services provided, including related Overhead costs, will be recovered only from the MWDOC Member Agencies electing to receive the service. 2.1.3 Once Core and Choice services are established for the purpose of the Fiscal Year 2011-2012 budget, those designations and their associated cost allocations shall thereinafter be presumed reasonable and appropriate; and such designations and cost allocations will be used by MWDOC in its budgeting in subsequent years, subject to Paragraph 5.3 below. The designation of any new or different services to be offered by MWDOC as Core or Choice will be made at the time the services are considered for approval by the MWDOC Board and will be subject to input from the Member Agencies during the review process described below. 2.2 Review of Budget. MWDOC will continue its practice of soliciting and considering review and input on its budget.from all MWDOC Member Agencies commencing in December and developing a conceptual draft budget for Member Agency review the following January. On or before March V"of each calendar year, MWDOC shall publish its draft budget and shall solicit comments from Member Agencies. Each Member Agency shall indicate to MWDOC in writing by March 15th of each year if any changes in the Choice Services they will be participating in are being considered or are to be deleted as a Choice Service (some services, such as the South Orange Coastal Ocean Desalination Project, have existing contractual commitments that differ from fiscal year commitments). In the absence of such timely notification of changes by the Member Agencies, the Member Agencies will be deemed to be participating without change in those Choice services in the following budget year to the same extent that the Member Agencies are participating in such Choice Services as of March 15. Member Agencies desiring to submit formal comments on the budget shall deliver such formal comments to MWDOC before April 15�"'. (See Section 6.1 below, "Elected Officials 'Meeting.")These comments will be considered in preparation of the final Budget and will be presented to the MWDOC Board in May. The Parties acknowledge that the MWDOC Board is solely responsible for final approval and establishment of the MWDOC Budget and all rates and charges. 4 Amended 12-14-10 3. MWDOC"S RESERVES 3.1 Purpose. MWDOC's Reserves allow it to meet operating and emergency financial requirements for operation of the District, including cash flow for managing grants and such expenses as future building improvements, Other Post Employment Benefits (OPER), unforeseen emergencies, potential litigation, and MWDOC elections. 3.2 Reserve Line Items. MWDOC adopter[ a Reserve Policy on June 16, 2010, as outlined in the chart below. MWDOC will segregate its reserves into these categories and will report on the levels each year during the budget preparation process: MWDOC Proposed Reserves as of June 30, 2010 Reserve Category Proposed Amount General Reserves $1,050,000 (Unrestricted Reserve) Grant/WUE Cash flow $1,000,000 (Designated Reserve) Election Expense (Designated $ 500,000 Reserve) Building Repair/Replacement $ 350.000 (Designated Reserve) Total Designated or $3,700,000 Unrestricted OPER Reserve $500,000 (irrevocable Trust -- Restricted) . 5 Amended 12-14-10 4. MWDOC CHOICE SERVICES MWDOC shall institute a budgeting process in accordance with.Section 2 above based on a designation of certain MWDOC services as Core services and other MWDOC services as Choice services. For the purposes of this Agreement and the MWDOC 2011-2012 Budget, the designation of Core and Choice services and Overhead costs are identified in Table A, attached. (See 5.3 below.) Input to any proposed changes in the designations shall be solicited from the Member Agencies in the annual budget preparation process in accordance with Section 2.2 above. 4.1 Designation of Choice Services. The Choice categories identified at this time are described below. During the first half of fiscal year 2010-11, MWDOC Staff and the Member Agencies will work together to develop the concept, structure, budget and participation terms for the following services and any others identified for implementation beginning July 1, 2011 These will be developed in such a way as to be offered to the Member Agencies for participation and will be incorporated into the proposed budget for 2011-12. 4.1.1 Proiect Participation Committees 4.1.1.1 South Orange Coastal Ocean Desalination Proiect will continue to be organized in a Project Participation format with five agencies participating on an equal cost-sharing basis. The participating agencies will ultimately determine all institutional, financing and delivery issues for the project. 4.1.1.2 Poseidon Huntington Beach Ocean Desalination Project is currently organized in a Project Participation format with 23 agencies participating on an equal cost-sharing basis. The costs to date for outside consulting have been paid for by Poseidon, so no local costs have been paid by the agencies. 4.1.2 MWDOC - Member Agency Agreements 4.1.2.1 School Program will be organized with each Member Agency participating and paying its share of costs on a per student basis, and this Program also includes as participants the non-Member Agency cities of Anaheim, Fullerton, and Santa Ana. 6 Amended 12-14-10 4.1.2.2 Water Use Efficiency Program will be developed as a pay-as-you-go or a pay-for-participation basis instead of a "choice" basis. Functionally, however, there will be "choice" programs offered to all Member Agencies by agreement or through direct participation by retail consumers or others in the water service area. The Parties anticipate that the terms for the agreements between MWDOC and the Member Agencies will range between 3 and 5 years. The eight programs currently in operation include: Residential clothes washers • Sprinkler nozzles SmarTimers o CII Plumbing Fixtures • Synthetic Turf Hotel Program • Industrial Program Landscape Certification Program 4.2 Right to Submit Proposal. If a Member Agency Party does not participate in a MWDOC Choice Service pursuant to the provisions of this Agreement, including Section 2 above, and desires to participate in a substantially similar Service from another Member Agency Party, as set forth in a written proposal, such Member Agency Party shall deliver to MWDOC, no later than March 15th of each year, a copy of the written proposal to receive such Service. MWDOC shall have thirty(30)days from receipt of such proposal to submit a scope and cost to provide the Service, for the Member Agency Party's consideration. „ 4.3 Core Programs shall be those listed in Table A. Any funding brought in via MWDOC efforts from its State or Federal advocacy efforts, except for those specifically being funded through a Project Participation Agreement, shall be available to all MWDOC Member Agencies via Core or Choice Programs, e.g., such as the Water Use Efficiency Program. 4.4 Overhead Costs shall be those listed in Table A. The Overhead costs are allocated over all Core and Choice services. Subject to Paragraph 5.3, if activities are ever added to or removed from the 7 Amended 12-14-10 list of Core or Choice services, the commensurate proportion of Overhead costs will also be allocated accordingly. The determination of the Overhead cost percentage applicable to each Core and Choice service for any particular year shall be made during the budget preparation process and fixed for the entire budget year. 5. REVENUE COLLECTION The Parties agree that MWDOC should transition its current rate structure,which includes both a per retail connection charge and a per acre-foot charge, to a structure that includes only a per retail connection charge. Currently, MWDOC's revenue from water rate charges is approximately 65% on the per retail connection charge and 35% on the per acre-foot charge. As described below, MWDOC shall increase the percentage on the per retail connection charge gradually, reaching 100% in fiscal year 2015-16. 5.1 Fixed Charges. Commencing in fiscal year 2011 -2012, MWDOC will begin transitioning to a 100%fixed charge. In the first year of this process, 80% of MWDOC's water rate charges for its operating budget will be fixed, and 20% will be water charges. Each year for the next four years, MWDOC will increase the amount on fixed charges by 5%. 5.2 Method of Fixed Charges. MWDOC will continue to use the methodology in effect as of the Effective Date to define retail service connections independent of size as the method of passing charges to the Member Agencies on a fixed charge basis. 5.3 Designation of Core, Choice, and Overhead Services. The designations of services and activities set forth in (i) Section 2.1 and Table A for Core and Choice Service, in (ii) Paragraph 4.4 and Table A for Overhead Costs, and in (iii) Paragraph 5.2 for Method of Fixed Charges, shall carry a presumption of reasonableness and, therefore, shall remain unchanged for the term of this Agreement, unless changed by amendment in accordance with the provisions of Section 15. 8 Amended 12-14.10 6. INTERACTION OF ELECTED OFFICIALS 61 Elected Officials' Meeting. MWDOC will hold a semi-annual meeting for elected representatives of the Member Agencies and a GSWC officer or the officer's designee in October and April ("Elected Officials' Meeting") in addition to any other meetings, workshops, or assemblies open to those officials. The meetings shall be chaired by the President of the MWDOC Board and it is the intent of the Parties that the primary attendees shall be members of their respective governing bodies. The forum will be used to discuss: • MWDOC activities, policies, and budget(including reserves) • MET activities and policies Statewide water resource issues • Strategies to increase Orange County's water supply reliability and to minimize Orange County water costs • Other topics of significant interest to the Orange County water community Beginning in March 2011 and each year thereafter, upon completion of the first DRAFT of the MWDOC Budget for the upcoming year, MWDOC will formally request comments on the budget from all 28 Member Agencies, as described in Section 2.2 above. MWDOC will report on the budget comments received from the Member Agencies at the Elected Officials' Meeting described herein. 6.2 Public Meetings. The Elected Officials' Meetings shall be noticed public meetings of MWDOC's Board. Each Member Agency participating in these meetings shall be responsible for compliance with the Brown Act by its own legislative body. (Government Code § 54950 etseq.) 7. SELECTION OF MET DIRECTORS 7.1 Recommended Appointments by MWDOC Member Agency Parties. Commencing with the first vacant MWDOC MET Director position following the Effective Date, the MWDOC Board will institute and follow the procedure set forth in this Section 7 for appointing MET Directors. 9 Amended 12-14-10 7.1.1 The MWDOC Administrative Code provides that the Board President shall nominate and the Board shall approve MET Directors. 7.1.2 Under the conditions and procedures established in this Agreement, the MWDOC Board will delegate limited nominating power to the MWDOC Member Agencies for two of MWDOC's MET Director positions. 7.1.3 When the first MET Director vacancy occurs following the Effective Date, the South County Agencies that are Member Agency Parties ("South County Parties") may nominate a candidate of their choosing("MET Candidate")through a process to which they all agree, directly to the MWDOC President and Board. In the absence of agreement among the South County Parties, the nomination(s) shall be determined by a "one agency, one vote" process among the South County Parties. Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the South County Parties. Once filled, that seat will be designated, pursuant to this Agreement, as the "South County Seat". 7.1.4 When the second MET Director vacancy occurs following the Effective Date, the North County Agencies that are Member Agency Parties ("North County Parties") may nominate a MET Candidate of their choosing, through a process to which they all agree, directly to the MWDOC President and Board. In the absence of agreement among the North County Parties, the nomination(s)shall be determined by a "one agency, one vote" process among the North County Parties. Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the North County Parties. Once filled, that seat will be designated, pursuant to this Agreement, as the "North County Seat". 7.2 The MWDOC Board shall consider each nominated MET Candidate seriously, in good faith and in the spirit of this Agreement and can only reject said MET Candidate for cause. The remaining MET Director seats shall continue to be filled pursuant to MWDOC's Administrative Code. MWDOC shall continue its practice of advising the Member Agencies when a vacancy occurs and soliciting potential candidates and input from all Member Agencies for filling these seats. 7.3 All MWDOC MET Directors shall serve for an indefinite term pursuant to the MWDOC Administrative Code; provided, however, a MWDOC MET Director holding the North County Seat or the South County Seat may be removed by MWDOC only after MWDOC has convened an ad hoc committee to review that MWDOC MET Director's performance and the ad hoc committee has solicited and considered the input of the respective nominating area as provided below. If a vacancy occurs in the North County Seat or the South County Seat, the North or South County Parties, as established herein, may make subsequent nominations to fill the vacancy in accordance with Sections 7.1.3 and 7.1.4, as applicable. The MWDOC Board President shall 10 Amended 12-14-10 consider appointment of an ad hoc committee to review the performance of MWDOC's MET Directors upon request of any MWDOC Board Member or Member Agency, or upon the MWDOC President's own determination. Such review, if any, may be conducted no more than once annually. If appointed, the ad hoc committee shall solicit input from the respective nominating areas on the performance of the North County and South County nominated MET Directors. Should the North County Parties or South County Parties deem it appropriate to remove their selected MET Director, they can make their request for removal to the MWDOC Board. The MWDOC Board will not unreasonably withhold action on such request(s). 8. COMPLIANCE WITH MWDOC ADMINISTRATIVE CODE Any MET Candidate nominated and appointed as provided herein must be familiar with MWDOC`s Administrative Code and express a willingness to comply with it. This includes, without limitation, meeting the criteria for a MWDOC MET Director established in Section 1600 of the MWDOC Administrative Code. 9. COMPLIANCE WITH LAW The nomination and appointment of any MET Candidate, as provided herein, must comply with applicable statutory and case law. 10. MET DIRECTOR ORANGE COUNTY CAUCUS MWDOC will schedule and conduct at its offices regular meetings of the MET Directors representing MET Member Agencies in Orange County. Meetings will be scheduled at least three (3) times per year to be determined by the Orange County MET Directors at the first meeting each year. The purpose of the meetings is to provide special access by all Member Agencies to the MET Directors representing Orange County. 11. REMEDIES AND ENFORCEMENT 11.1 Remedies in General. Except as set forth below, each Party shall have all remedies otherwise available to enforce the terms of the Agreement and to seek remedies for any breach hereof, including but not limited to the remedies set forth in Sections 11.2.3,11.5 and 11.6 of this Agreement. 11.2 Breach of the Agreement. 11 Amended 12-14-10 112.1 Any material breach or material violation of the Agreement shall be deemed a default under this Agreement. 11.2.2 In the event of an alleged material breach or material violation of the Agreement, the Parties agree to work together in good faith to resolve any disagreement using the following dispute resolution process: 11.2.2.1 The Party alleging a breach shall notify the other Parties of the basis for the allegation and the requested cure for the breach. 11.2.2.2 The alleged breaching Party receiving notice of breach shall have 15 calendar days to respond. If the response acknowledges that a breach has occurred, the breaching Party shall have 30 days to cure such breach, provided that if such breach cannot be reasonably capable of being cured within said 30-day period, then the breaching Party shall not be in default of this Agreement provided that the breaching Party is diligently continuing to cure such default. 11.2.2.3 If the Party alleging a breach and the alleged breaching Party disagree with respect to whether a breach has occurred, they shall meet and confer in good faith toward a mutually satisfactory solution. The meet and confer shall be open to all Parties. 11.2.2.4 If the dispute cannot be.resolved through the meet and confer process within 60 calendar days after the first meeting, the Party alleging a breach and the alleged breaching Party, along with any other Party that wishes to participate, shall engage in third party mediation, with the participating Parties to equally share mediation costs. Said mediation shall end no later than 90 calendar days after the completion of the original meet and confer process. No Party may file a lawsuit concerning the alleged breach until the mediation has ended. 11.2.2.5 In the event a lawsuit is filed after completion of the mediation concerning the alleged breach, the Parties` rights and obligations under this Agreement shall continue until one of three actions occurs: (1) the agreement continues as drafted; (2)the agreement is terminated; or(3)an amendment to the agreement is entered into pursuant to Section 15. 11.2.3 Any Party to this Agreement may, in addition to any other remedy, seek an order from a court specifically enforcing the 12 Amended 12-14-10 obligations of the Parties to the Agreement to comply with this Section 11.2. 11.3 Material Breach in the Event of Certain Activities. The Parties to this Agreement have mutual interests in avoiding the time, expense, and uncertainty of either(a) legislative measures that would affect MWDOC's organizational form or(b)filing an application with the OCLAFCO for secession of a Parry or detachment of a Party's territory from MWDOC. Consequently, the Parties to this Agreement agree that"material breach,"within the meaning of Section IL(a) shall include (but not be limited to) the following activities that any Party hereto may undertake during the term of this Agreement: 11.3.1 The submission of an application with OCLAFCO to reorganize or undertake an action that would result in a Party's secession or the detachment of all or a portion of a Party's territory, from MWDOC, or would result in any other material change in governance or structure affecting MWDOC. 11.3.2 The filing of any written letters or testimony with, or providing verbal testimony to, any committee or other body of the State Legislature in support of legislative measures that would (A) materially affect MWDOC's organizational form or change the governance of MWDOC, and (B)would result in secession or detachment of territory from MWDOC by any Member Agency. 11.4 An action constituting a material breach under Sections 2.2, 4, 5, 6, 7, 10, or 11.3 shall be subject to the dispute resolution provisions of Section 11.2.2. 11.5 Enforcement. Any Party may enforce compliance by a defaulting Party with the terms of this Agreement by, among other available remedies: 11.5.1 Filing a complaint for specific performance; 11.5.2 Filing an action to recover actual damages to which the notifying Party may be entitled for violation by the defaulting Party of the terms of this Agreement; 11.5.3 Filing an action to enjoin the violation, on an ex parte basis if necessary, by temporary or permanent injunction, without the necessity of proving either actual damages or the inadequacy of otherwise available legal remedies, or for other equitable relief; 13 Amended 12-14-10 11.5.4 Petitioning for a writ of ordinary or administrative mandate ordering the defaulting Party to cure; and/or 11.5.5 Petitioning for a writ of ordinary or administrative mandate ordering OCLAFCO not to process an application filed in contravention of this Agreement. 11.6 Injunctive and Temporary Relief Appropriate. The Parties acknowledge that breach of this Agreement may not be adequately remedied by monetary damages and could result in irreparable harm to the aggrieved Parties. Therefore, injunctive and temporary relief may be appropriate to ensure compliance with the terms of this Agreement. 12. TERM OF AGREEMENT 12.1 Effective Date. This Agreement shall be effective upon the date of execution by MWDOC, which shall execute the Agreement upon express approval of its Board ("Effective Date"). MWDOC shall inform all Parties by e-mail when that event occurs. 12.2 Subsequent Execution. Any Member Agency that executes this Agreement after the Effective Date shall, upon execution, become a full Party to the Agreement, with all the rights and obligations set forth herein. 12.3 Termination Date. This Agreement shall run for a term of five (5) years from the Effective Date, unless terminated as provided herein. This agreement may be extended by mutual agreement of all of the Parties hereto for subsequent term(s)five (5) years, or other period as mutually agreed to at the time of the extension. 13. OBLIGATIONS OF MEMBER AGENCIES 13.1 No OCLAFCO Application. During the term of this Agreement, none of the Member Agency Parties shall prepare, hire a consultant to prepare, or submit an application to OCLAFCO requesting reorganization or any action that would result in detachment of any territory from MWDOC or any other change affecting the governance, structure, or finances of MWDOC, unless agreed to in writing by MWDOC. In the event that the OCLAFCO undertakes proceedings, whether in response to an application or pursuant to its own discretionary powers, that reduces the territory within the boundaries or affects or changes the governance, structure or finances of MWDOC, these proceedings shall be considered a material breach of this Agreement by the Party or 14 Amended 12-14-10 Parties filing, supporting or in any way furthering the application except to the extent their actions are required by law. 13.2 No Legislative Activities. During the term of this Agreement, none of the Member Agency Parties shall pursue, support, or further any legislative measures that would affect MWDOC's organizational form, board or staff members, finances, exercise of powers, or governance or result in detachment of any territory from MWDOC, unless agreed to in writing by MWDOC. 13.3 Participation in Agreement. During the term of this Agreement, the Member Agency Parties, and each of them, shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement. 14. OBLIGATIONS OF MWDOC 14.1 No OCLAFCO Application. During the term of this Agreement, MWDOC shall not prepare, hire a consultant to prepare, or submit an application to OCLAFCO as described in Paragraph 13.1 relating to the governance, structure, or finances of MWDOC or any equivalent OCLAFCO application relating to the governance, structure, or finances of any of its Member Agencies, unless agreed to in writing by the affected Member Agency. 14.2 No Legislative Activities. During the term of this Agreement, MWDOC shall not pursue, support, or further any legislative measures that would affect any Member Agency's organizational form, board or staff members, finances, exercise of powers, or governance or result in detachment of any territory from the Member Agency, unless agreed to in writing by the Member Agency. 14.3 Participation in Agreement. During the term of this Agreement, MWDOC shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement. 15. AMENDMENT OF AGREEMENT 15.1 Any amendment, alteration, or variation of any provision of this Agreement("Amendment")will not be valid unless made in writing and approved as provided in this Section. 15.2 The Parties acknowledge that the process of obtaining initial approvals and execution of this Agreement has required a substantial investment of public resources and time and that the same process should not be required for subsequent Amendments to the Agreement that are proposed without objection. For this reason, Amendments to the Agreement may be made as provided in this section. 15.2.1 An Amendment to the Agreement proposed by MWDOC shall be distributed by MWDOC to all Parties signing this 15 Amended 12-14-10 Agreement for a 60-day review period. 16.2.2 Any and all comments and objections to the Amendment shall be provided by the Parties to MWDOC and the remaining Member Agency Parties before the conclusion of the 60-day review period. 15.2.3 If no objections are received by the conclusion of the 60-day review period, the Amendment shall be valid and binding on the Parties. Upon this occurrence, MWDOC will provide a copy of the Amendment to all Parties. 15.2.4 If any objections are received within the review period, MWDOC may submit the proposed Amendment to the Parties for signatures, and if the proposed Amendment is executed by MWDOC and all of the Member Agency Parties, the Amendment shall be valid and binding on the Parties. Upon this occurrence, MWDOC will provide a copy of the Amendment to all Parties. 15.3 An Amendment to the Agreement proposed by a Party other than MWDOC shall be submitted in writing to MWDOC. Upon receipt of the proposed Amendment, MWDOC shall then follow the procedures set forth in section 15.2 above. 16. NO ADMISSION BY ANY PARTY The Parties acknowledge that statements made by the Parties during negotiation of this Agreement, statements made in this Agreement, and all rights and obligations that arise from this Agreement were and are in furtherance of the goal of resolving issues between the Parties without the need for administrative or judicial proceedings, including possible OCLAFCO proceedings and litigation. Neither any statement made during negotiation of this Agreement nor any provision of the Agreement itself shall constitute an admission by a Party or be offered as evidence or included in any record of proceedings in any future administrative or judicial proceeding. 17. GENERAL PROVISIONS 17.1 All Parties are deemed to have participated in the drafting of this Agreement, and any rule of law(including, but not limited to, Civil Code Section 1654)or legal principle that would require interpretation of this Agreement against the drafter hereto shall not apply and is waived by the Parties. This Agreement may be signed in multiple counterparts for convenience of the Parties. 17.2 This Agreement will inure to the benefit of and be binding upon all Parties and their respective successors and assigns. 17.3 This Agreement will be deemed a contract made under the laws of 16 Amended 12-1410 the State of California and for all purposes will be interpreted in accordance with such laws. The Parties hereby agree and consent to the exclusive jurisdiction of the courts of the State of California. 17.4 This Agreement constitutes the entire agreement among the Parties. This Agreement supersedes any and all other understandings or agreements, either oral or in writing, among the Parties with respect to the subject matter hereof and contains all of the covenants and agreements among them with respect to said matters; and each Party acknowledges that no representation, inducement, promise of agreement, oral or otherwise, has been made by any other Party or anyone acting on behalf of any other Party that is not embodied herein. 17.5 If any action at law or equity, including any action for writ of mandate or injunctive relief, is brought to enforce or interpret the provisions of this Agreement, the prevailing Party(ies) shall be entitled to its or their reasonable attorney's fees and costs as against the Party(ies)that dict not prevail in that action or proceeding. 17.6 All activities undertaken pursuant to this Agreement must be in compliance with all applicable state and federal laws and regulations. 17.7 In the event one or more of the provisions contained in this Agreement is held invalid, illegal or unenforceable by any court of competent jurisdiction, such portion shall be deemed severed from this Agreement and the remaining parts of this Agreement shall remain in full force and effect as though such invalid, illegal, or unenforceable portion had never been a part of this Agreement. 17.8 All communications set forth in this Agreement shall be in writing and transmitted to and among the Parties in a manner that is consistent with the custom and practice of MWDOC and its Member Agencies then in effect. Any computations of time shall start from 5:00 PM on the day of receipt. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the respective dates shown below. Mayor, City of San Clemente Date, 17 Amended 12-14-10 Mayor, City of San Juan Capistrano Date President, EI Toro Water District Date 18 Amended 12-14-10 President, Irvine Ranch Water District Date President, Laguna Beach County Water District Date President, Municipal Water District of Date ©range County President, Moulton Niguel Water District Date President, Santa Margarita Water District Date President, South Coast Water District Date 19 Amended 12-14-10 President, Trabuco Canyon Water District Date Mayor, City of Brea Date Mayor, City of Buena Park Date Mayor, City of f=ountain Valley Date Mayor, City of Garden Grove Date Mayor, City of Huntington Beach Date 20 Amended 12-14-10 Mayor, City of La Habra Date Mayor, City of La Paima Date Mayor, City of Newport Beach Date Mayor, City of Orange Date Mayor, City of Sea[ Beach Date Mayor, City of Tustin Date 21 Amended 12-14-10 Mayor, City of Westminster Date President, East Orange County Water District Date President, Emerald Bay Service District Date Officer, Golden State Water Company Date President, Mesa Consolidated Water District Date President, Orange County Water District Date 22 Amended 12-14-10 President, Serrano Water District Date President,Yorba Linda Water District Date Z:IUsers DatalggoodreaulMWDOC13381afcoissueslagmtslMWDOCAgreement markupll-11-10fina[ dncxl21410rgb.docx 23 FINAL—9-17-19 Table A - MWDOC Breakdown of Services/Activities/Costs Core: Sit vxce CMo : tce.somees v Uverhead;Costs Board Compensation&Benefit Water Use Efficiency Salary charged to overhead Retiree Costs • Residential clothes washers function(vacation,sick leave and holidays) Legal Costs • Sprinkler nozzles Personnel development Board Elections • SmarTimers Accounting and General Admin • CII Plumbin 6=Fixtures Legal costs charged to overhead function MET Representation • Synthetic Turf Employee benefits • MET Director Support • I Iotel Program Personnel/staff development • MET policy analysis,programs and special • Industrial Program Information technology projects • Landscape Certification Conference employee • MET operations,water rates and accounting Program Travel&Accommodations Staff time for MWDOC's Water Use Efficiency Includes marketing materials for employee Prograins Manager WUE activities,staff time, Automotive/Mileage/"I'ol I overnmental AMiri overhead and grant funds(ME'r Office maintenance • In-house staff for legislative info and other) • WACO,ISDOC and other support Governmental Relations Rents&Leases Office supplies 3 • Federal lobbyist for countywide funding ° Any project or program legislative or grant support Insurance expenses • State lobbyist for countywide legislative,grant on choice activities— Utilities—telephone funding and policy access Townsend Public Affairs Miscellaneous expenses • Local lobbyist for Board of Supervisors S eoific Pro rams Professional fees for overhead Public Affairs • School program activities • Coordination with MET,other regional and local • South Orange Coastal Software support retailers Ocean Desal Project computers/software • Basic communications functions-media outreach o. Federal lobbying and inquiries,water information and messaging, for SOCODP- MWDOC website Barker • MWDOC newsletter(e-currents) o Federal lobbying • Countywide surveys as appropriate for SOCODP— • Countywide water awareness in coordination with Townsend retail agencies • Support for Poseidon Desal Research---support for Center for Demographic Project Research • Other Project specific Water Supply Planning studies • Coordination among agencies • Non-countywide issue • Water use tracking and projections studies • Water supply analysis • Regulatory compliance issues • Water trends analysis • Countywide studies Water Emergency Response Organization of Orange County(WEROC)—MWDOC contribution 24 41'1912011 AGENDA REPORT 5a TO: Dave Adams, Interim City Manager ` FROM: William Curry, Assistant Utilities Department Director SUBJECT: Consideration of an Agreement Between Municipal Water District of Orange County (MWDOC) and its Member Agencies on Budget, Activities, Charges, and Other Issues. RECOMMENDATION: By motion adopt the attached agreement and elect to participate in the South Orange Coastal Ocean Desalination Project, MWDOC's School Program and MWDOC's Water Use Efficiency Programs. SITUATION: Due to concerns raised by member agencies the Municipal Water District of Orange County (MWDOC) has proposed the attached agreement between MWDOC and its member agencies. This agreement proposes a `Choice" program that allows individual member agencies to elect to participate in certain programs, that they are currently required to participate in currently. Beginning in fiscal year 2011-12, MWDOC will adopt a new business model in which individual Member Agencies will have a choice as to whether they participate in certain MWDOC programs. The "choice" programs will include: South Orange Coastal Ocean Desalination Project • Poseidon Huntington Beach Ocean Desalination • MWDOC's School Program • MWDOC's Water Use Efficiency Programs Each year, MWDOC will develop a budget for these "choice" programs in collaboration with the Member Agencies and only the Member Agencies that elect to participate will be charged directly for these services. Going forward, MWDOC will have the opportunity to develop additional programs or modify programs through this new service model. Under the agreement, MWDOC will also realign its rate structure to reflect the regional nature of MWDOC's services. MWDOC's current rate structure includes both a fixed retail connection charge and a per acre-foot charge. Approximately 65% of MWDOC's revenues are captured from the per-retail connection charge, and 35% are captured through the per acre-foot charge. Beginning in fiscal year 2011-12, MWDOC will transition over a five year period to recovering all of its revenue from the fixed retail connection charge. Agenda Report Page 2 April 19, 2011 Signatories to the agreement will be given the opportunity to nominate candidates to be appointed by MWDOC to the MET Board of Directors when vacancies occur among MWDOC's delegation of four directors appointed to the MET Board. F=ollowing the first vacancy from the MWDOC's MET delegation, signatories from South County will nominate one candidate. Signatories from North County will nominate a candidate following the second vacancy. The MWDOC Board will give serious consideration to each candidate and can only reject nominated candidates for "cause". After the MET directors are appointed, they serve in an "at will" capacity at the pleasure of the MWDOC Board with input from the respective North and South County agencies and from the other MWDOC agencies. Under the agreement, MWDOC will begin holding additional meetings to increase Member Agency involvement in MWDOC's activities, and in developing water resource goals and objectives for the region. MWDOC will hold semi-annual meetings specifically for elected representatives from Orange County water entities to attend and participate. MWDOC will conduct additional MET director meetings each year in coordination with the MET Member Agency cities of Anaheim, Fullerton, and Santa Ana that will be open to all entities in the County. Summary and Recommendation. Without modification to the program the City would incur a cost of approximately $102,000, and is based upon the information provided by MWDOC (see attachment 2, MWDOC Proposed Choice Budget and Increased Meter Charge). Based upon the proposed change to the Choice Budget and without any modification to the existing services provided, the City would incur a cost of approximately $132,000, resulting in an increase cost of approximately $30,000. The cost of the "Choice" program would be $46,244.00, broken down as follows: Pro ram: Cost. South Orange Coastal Ocean Desalination Project $19,688.00 MWDOC's School Program $3,364.00 MWDOC's Water Use Efficiency Programs _ $23,212.00 Total: $46,244.00 The South Orange Coastal Ocean Desalination Project (SOCOD) was previously donated by MWDOC, and now would be a separate cost. The Water Use Efficiency program provides significant benefits to the Community in the form of residential and commercial programs, which have provided an estimated 404 acre foot of water savings over the lifetime of the program. Background. The Municipal Water District of Orange (MWDOC) provides wholesale imported water to the City of San Juan Capistrano, and 27 other Member Agencies throughout Orange Agenda Report Page 3 April 19, 2011 County. MWDOC receives imported water from the Colorado River Aqueduct and State Water Project through the Metropolitan Water District of Southern California (MET) and also provides the following services- ® MWDOC is a member agency of MET o Appoints four member to the MET Board of Directors o Represents 28 Member Agencies' interest at MET (collectively we pay about $140 million dollars to MET each year) ® MWDOC also provides regional services for Orange County o Water use efficiency programs o Water supply planning activities o Public affairs o Governmental affairs o School education programs o Emergency preparedness programs through the Water Emergency Response Organization of Orange County (WEROC) o Seeks and secures grants each year ranging from about $3 million to about $7 million to help offset local costs or expand services available in Orange County MWDOC's operating budget to cover staff time and other expenses runs about $5.5 million per year. Often, grant funding brought into Orange County by MWDOC ranges between $3 million and $7 million per year. The grant funds are used to help implement various water programs in the County. Including water purchases and debt service, MWDOC's total budget is about $154 million per year. MWDOC also provides considerable assistance to the Orange County Water District in seeking and securing imported replenishment water and other conjunctive use accounts and in managing this water supply in Orange County. Politically, MWDOC is active in looking out for the best interests of the residents within Orange County and in assisting MET in pursuing solutions to the State Water Project and Colorado River supply problems. MWDOC works with its Member Agencies in a cooperative and collaborative manner in many different forums that are convened on a monthly basis and open to all agencies. These include: ® Public Affairs Workgroup e Water Use Efficiency Workgroup • Member Agency Manager's Meetings ® Joint Meetings with the MWDOC Directors and MET Directors ® Joint Planning Committee meeting between MWDOC and OCWD • Poseidon Huntington Beach Ocean Desalination Workgroup ® South Orange Coastal Ocean Desalination (Dana Point) Workgroup ® Other forums as necessary Over the past several years, MWDOC's activities, budget and service model were questioned by several of its Member Agencies. These agencies raised concerns over whether MWDOC should be more responsible to the public who elected the directors of Agenda Report Page 4 April 19, 2011 MWDOC or to the Member Agencies (another "public"). MWDOC's position has always been that both sets of "public" are important to our business and together MWDOC and its Member Agencies service the good of the general public. Several of the Member Agencies requested the ability to opt out of certain services. Questions were also raised about the equity of MWDOC's rate structure and whether MWDOC's governance structure is appropriate for the types of services it provides. These concerns were discussed over several years in a number of forums and are now being resolved via the attached "settlement agreement" being entered into by MWDOC and its 28 Member Agencies. The attached agreement addresses the concerns raised and provides for new policies and opportunities to increase the amount of input and choice in MWDOC's services, while maintaining MWDOC's role as a wholesale water provider and regional water planning agency. During the term of this agreement, MWDOC's Member Agencies will agree not to pursue changes to MWDOC's governance structure, finances, or a detachment from MWDOC, either through legislation, or through an application to the Orange County Local Agency Formation Commission (OCLAFCO) while MWDOC will agree to a number of changes as outlined below. The new framework set forth in this agreement was developed through an extensive negotiating process. MWDOC is looking to.have all 28 of its Member Agencies consider and approve the document. The agreement will be considered by MWDOC Board for action after approximately two-thirds of the Member Agencies (19) have approved the agreement. As of March 22, 2011 fourteen member organizations have approved the MWDOC agreement they are: • Irvine Ranch Water District • Santa Margarita Water District • Trabuco Canyon Water District • El Toro Water District • Emerald Bay Service District • Moulton Niguel Water District • South Coast Water District • City of Garden Grove • City of San Clemente • EOCW D • Serrano Water District • City of Huntington Beach • City of Seal Beach • City of Tustin Agenda Report Page 5 April 19, 2011 COMMISSION/BOARD REVIEW AND RECOMMENDATIONS: The Utilities Commission during their March 22, 2011 regular meeting by motion unanimously recommended approval of the proposed agreement. FINANCIAL CONSIDERATIONS: The Utilities Department currently budgets in the general operating budget the costs associated with MWDOC membership. The City's estimated cost without modification to the current agreement would be approximately $102,000.00. The proposed cost with the modified agreement would be approximately $132,000. Of this $132,000, approximately $26,000.00 can be funded out of the Water Conservation fund. The 106,000 would thea be funded out of the operational budget (Enterprise Fund). NOTIFICATION: Municipal Water District of Orange County (MWDOC) RECOMMENDATION: By motion adopt the attached agreement and elect to participate in the South Orange Coastal Ocean Desalination Project; MWDOC's School Program and MWDOC's Water Use Efficiency Programs. Respectjblly subTt�ed, Prpp red by: lzlile William Curry, J stin it , Assistant Utilities Department Director '... enior Management Analyst Attachment(s): 1. Proposed Agreement 2. MWDOC Proposed Choice Budget and Increased Meter Charge u Srru°!AddressJanuary 6, 2011 000 Watd strut Via email Fountain'Valley,California 92708 r tvrt;ry�rtdr°ss: Dear Board and Council Members, F0.Box 20695 Fountain Valley,ca 92728-0695 Subject: Approval of Agreement between Municipal Water District of h (714)963,3058 Grange County(MWDOC) and its Member Agencies Fax (714)964 9369 MWDOC has been working with its Member Agencies on changes to its business model which will enable us to better meet our agencies'needs and resolve long standing Joan C.Finnegan causes of disagreement with several of our Member Agencies. We thank all the City president Jetrery€ .Tncn,as Council, Board.members, water managers and staff for their assistance and patience Vice Presider,l with the process. On September 17, 2010, we distributed an Agreement to achieve new C3 PO Bartrre goals. Subsequently, several relatively minor changes were necessary for clarity and ease of implementation. The changes include, Wayne R.Clark fNrecior ' � Moving Emerald Bay Service District from a North county agency to a South Larry D.Dick IJA�clor county agency Susan f finnan Reducing the term of the agr cement to five years Director Clarifying that rights and objectives specified only apply to signatory agencies Incl Royce.sr. I Clarifying provisions on restrictions of Actions by all paries with regard to EJirectnr Kevin P.Hunt,p 1 A CS General Manager Specifying that amendments will only be implemented with unanimous consent ffi Changing several.minor points for clarity and consistency W,RE R1 h ;E ,"j'.".. Attached please find the Settlement Agreement between MWDOC and its Member City of Brea Agencies on Budget, Activities,Changes and other Issues. Also attached, MWDOC city of suena Pail has drafted a sample staff report for your use or modification in presenting the EAOrango County Water Distticl Settlement Agreement to your Board or Council, The Agreement is now ready for your F1 Toro Wa€er 17isiricl consideration and action. I am asking for your agency's/city's approval. Upon approval Fmetald Bay service District by MWDOC's Member.Agencies, the Agreement will go to MWDUC for action_ City of Fountain Valley City of Garden Grove please note that we are available anytime to explain any aspect of the agreement and its Golden Slate Vl+aler Co, potential impacts on your agency/city. Please refer all questions to our General City orHuntington Baacb Manager,Kevin P. Hunt,at 714/593-5026 or email khunt(a)mwdoc.com. Mr- Hunt will Irvine Ranch Water District Laguna Beach Courtly taster District be glad to meet with you at your convenience. Meetings with your elected officials will Cliy of La Labra include our MWDOC Director representative. City of La Palma Mesa consolidated Water District Thank you again for all of the hours you have spent over the past few months and years Moulton NigualWaterDistrict in negotiating this agreement. We loop forward to working together.to assure the future City of Newport Beach water supply reliability in Orange County at the lowest cost for all of our citizens. Lily of Orange Orange ComlyWolerDistrirl Sincerely, Giry of San Clemente City at San Juan Capistrano l-� Sana margarita Water t?islrinl City of Seal Beach Serrano Water oistdcl Joan C. Finnegan South Coast Water District President Trabuc°Canyon Water District City of Tustin City of Westminster Yorba Linda Water District ATTACHMENT 1 Amended 12-14-10 AGREEMENT BETWEEN MWDOC AND ITS MEMBER AGENCIES ON BUDGET, ACTIVITIES, CHARGES, AND OTHER ISSUES This Agreement is made by and between the Municipal Water District of Orange County("MWDOC")and those of its 28 Member Agencies that have signed below (referred to collectively as "Member Agency Parties" and individually as "Member Agency Party"). Signatories to this Agreement are also referred to herein collectively as "Parties"and individually as "Party." This Agreement is effective as of the Effective Date established pursuant to Section 12.1 below. RECITALS WHEREAS, MWDOC is a wholesale water provider to 28 Member Agencies in Orange County, California; and WHEREAS, MWDOC is a member agency of the Metropolitan Water District of Southern California ("MET") and appoints four(4) directors to MET's Board of Directors, and Whereas, MWDOC was formed in 1951 by Orange County voters to provide imported water from MET into Orange County; and Whereas, MWDOC has been performing this function and many other functions since its formation in support of Member Agencies within its service area; and Whereas, MWDOC was formed and operates pursuant to the Municipal Water District Law of 1911 (Water Code Section 71000 et seq.) and is governed by a seven-member publicly elected Board of Directors; and, Whereas, an essential area of MWDOC's authority includes the setting of rates for water commodities and services, and while rates may be different for different classes or conditions of service, they shall be uniform for like classes and conditions of service (Water Code § 71614); and, Whereas, an essential area of MWDOC's authority includes representing the Member Agencies at MET to ensure that the approximately$140 million paid to MET each year by MWDOC is used effectively and efficiently; and, Whereas, in addition to its role at MET, MWDOC's regional services to its Member Agencies currently include water use efficiency programs, water supply planning activities to improve reliability and emergency preparedness, the Water Emergency Response Organization of Orange County("WEROC"), the school education program, and numerous other programs; and 1 Amended 12-14-10 Whereas, in support of these services to its Member Agencies, MWDOC seeks grant funding for its programs, engages lobbyists on the Federal, State and local levels, and operates a public affairs department that serves its Member Agencies and their customers; and Whereas, MWDOC's budget and rates have been the subject of discussion between MWDOC and some of its Member Agencies over the past several years, and these Member Agencies have raised concerns over whether the rate structure is equitable and whether a Member Agency should be able to opt out of certain services if it provides those services; and Whereas, in conjunction with the preparation by the Orange County Local Agency Formation Commission ("OCLAFCO") of its 2007 Municipal Services Review and Sphere of Influence for MWDOC, MWDOC and several of its Member Agencies from southern Orange County participated in a series of "stakeholder" discussions facilitated by OCLAI=CO in an attempt to resolve these and other concerns; and Whereas, following approval by Orange County LAFCO of the 2007 Municipal Services Review and Sphere of Influence for MWDOC, OCLAFCO retained a consultant to conduct a study of"governance options"for MWDOC ("Governance Study"), which Study was funded 50% by MWDOC and 50% by six of its Member Agencies from southern Orange County; and Whereas, the same six Member Agencies, namely El Toro Water District, Trabuco Canyon Water District, Santa Margarita Water District, Irvine Ranch Water District, Moulton Niguel Water District and South Coast Water District, have issued a "White Paper" regarding the formation of a "South Orange County Water Authority"that discusses issues associated with formation of such an agency if certain changes in MWDOC's operations are not made; and Whereas, the Governance Study recommended the addition of three Member Agencies into the Study effort-- the City of San Clemente, the City of San Juan Capistrano and Laguna Beach County Water District, thereby bringing the total number of"South County Agencies" to nine; and Whereas, the other Member Agencies of MWDOC are the City of Brea, City of Buena Park, City of Fountain Valley, City of Garden Grove, City of Huntington Beach, City of La Habra, City of La Palma, City of Newport Beach, City of Orange, City of Seal Beach, City of Tustin, City of Westminster, East Orange County Water District, Emerald Bay Services District, Golden State Water Company ("GSWC"), Mesa Consolidated Water District, Orange County Water District, Serrano Water District, and Yorba Linda Water District. Whereas, Emerald Bay Services District boundaries are located in the southern Orange County area and has requested to be included as a South County Agency, as hereinafter defined for purposes of this agreement; and Whereas, the Parties signing below have reached a comprehensive agreement, memorialized herein ("Agreement"), that accommodates the interests of all 2 Amended 12-14-10 Parties, maintains MWDOC as the wholesale regional planning agency and promotes a cooperative and collaborative partnership between MWDOC and its Member Agencies; NOW,THEREFORE, THE PARTIES ACKNOWLEDGE AND AGREE AS FOLLOWS: 1. DEFINITIONS 1.1 "South County Agencies,"as referenced in the recitals above, refers collectively to City of San Clemente, City of San Juan Capistrano, EI Toro Water District, Irvine Ranch Water District, Laguna Beach County Water District, Moulton Niguel Water District, Santa Margarita Water District, South Coast Water District, Trabuco Canyon Wafter District and Emerald Bay Services District. 1.2 "Member Agencies" refers to any and all entities, public or private, that purchase water from MWDOC. "Member Agency Parties" refers to Member Agencies who have signed this Agreement. 1.3 "North County Agencies"as referenced in the Recitals above refer collectively to Member Agencies(other than the South County Agencies), including the City of Brea, City of Buena Park, City of Fountain Valley, City of Garden Grove, City of Huntington Beach, City of La Habra, City of La Palma, City of Newport Beach, City of Orange, City of Seal Beach, City of Tustin, City of Westminster, East Orange County Water District, District, Golden State Water Company, Mesa Consolidated Water District, Orange County Water District, Serrano Water District, and Yorba Linda Water District. 2. MWQ0C BUDGET 2.1 Core and Choice Services. Commencing in Fiscal Year 2011- 2012, MWDOC will organize its budget according to "Core" services and "Choice" services. (See Section 4 below regarding designation of specific services as Core and Choice.) 2.1.1 The Core services budget shall include services identified by MWDOC as services that are both essential to its mission and carried out on behalf of the entire MWDOC service area for all 28 Member Agencies. The Core services also include services that MWDOC determines cannot practicably or efficiently be budgeted and charged to individual Member Agencies on an agency-by-agency basis. 3 Amended 12-14-10 2.1.2 Choice services shall be budgeted, described, and priced in a manner that is intended to allow individual Member Agencies to decide whether to receive such services from MWDOC. MWDOC's costs for Choice services provided, including related Overhead costs, will be recovered only from the MWDOC Member Agencies electing to receive the service. 2.1.3 Once Core and Choice services are established for the purpose of the Fiscal Year 2011-2012 budget, those designations and their associated cost allocations shall thereinafter be presumed reasonable and appropriate; and such designations and cost allocations will be used by MWDOC in its budgeting in subsequent years, subject to Paragraph 5.3 below. The designation of any new or different services to be offered by MWDOC as Core or Choice will be made at the time the services are considered for approval by the MWDOC Board and will be subject to input from the Member Agencies during the review process described below. 2.2 Review of Budget. MWDOC will continue its practice of soliciting and considering review and input on its budget from all MWDOC Member Agencies commencing in December and developing a conceptual draft budget for Member Agency review the following January. On or before March 1 Sti of each calendar year, MWDOC shall publish its draft budget and shall solicit comments from Member Agencies. Each Member Agency shall indicate to MWDOC in writing by March 15th of each year if any changes in the Choice Services they will be participating in are being considered or are to be deleted as a Choice Service (some services, such as the South Orange Coastal Ocean Desalination Project, have existing contractual commitments that differ from fiscal year commitments). In the absence of such timely notification of changes by the Member Agencies, the Member Agencies will be deemed to be participating without change in those Choice services in the following budget year to the same extent that the Member Agencies are participating in such Choice Services as of March 15. Member Agencies desiring to submit formal comments on the budget shall deliver such formal comments to MWDOC before April 15th. (See Section 6.1 below, "Elected Officials 'Meeting.") These comments will be considered in preparation of the final Budget and will be presented to the MWDOC Board in May. The Parties acknowledge that the MWDOC Board is solely responsible for final approval and establishment of the MWDOC Budget and all rates and charges. 4 Amended 12-14-10 3. MWDOC"S RESERVES 3.1 Purpose. MWDOC's Reserves allow it to meet operating and emergency financial requirements for operation of the District, including cash flow for managing grants and such expenses as future building improvements, Other Past Employment Benefits (OPER), unforeseen emergencies, potential litigation, and MWDOC elections. 3.2 Reserve Line Items. MWDOC adopted a Reserve Policy on June 16, 2010, as outlined in the chart below. MWDOC will segregate its reserves into these categories and will report on the levels each year during the budget preparation process: MWDOC Proposed Reserves as of June 30, 2010 Reserve Category Proposed Amount General Reserves $1,060,000 (Unrestricted Reserve) Grant/WUE Cash flow $1,000,000 (Designated Reserve) Election Expense (Designated $ 500,000 Reserve) Building Repair/Replacement $ 350.000 (Designated Reserve) Total Designated or $3,700,000 Unrestricted OPEB Reserve $500,000 (Irrevocable Trust -- Restricted) s Amended 12-14-10 4. MWDOC CHOICE SERVICES MWDOC shall institute a budgeting process in accordance with Section 2 above based on a designation of certain MWDOC services as Core services and other MWDOC services as Choice services. For the purposes of this Agreement and the MWDOC 2011-2012 Budget, the designation of Core and Chace services and Overhead costs are identified in Table A, attached. (See 5.3 below.) Input to any proposed changes in the designations shall be solicited from the Member Agencies in the annual budget preparation process in accordance with Section 2.2 above. 4.1 Designation of Choice Services. The Choice categories identified at this time are described below. During the first half of fiscal year 2010-11, MWDOC Staff and the Member Agencies will work together to develop the concept, structure, budget and participation terms for the following services and any others identified for implementation beginning July 1, 2011 These will be developed in such a way as to be offered to the Member Agencies for participation and will be incorporated into the proposed budget for 2011-12. 4.1.1 Proiect Participation Committees 4.1.1.1 South Orange Coastal Ocean Desalination Pro'ect will continue to be organized in a Project Participation format with five agencies participating on an equal cost-sharing basis. The participating agencies will ultimately determine all institutional, financing and delivery issues for the,project. 4.1.1.2 Poseidon Huntington Beach Ocean Desalination Project is currently organized in a Project Participation format with 23 agencies participating on an equal cost-sharing basis. The costs to date for outside consulting have been paid for by Poseidon, so no local costs have been paid by the agencies. 4.1.2 MWDOC - Member Agency Agreements 4.1.2.1 School Program will be organized with each Member Agency participating and paying its share of costs on a per student basis, and this Program also includes as participants the non-Member Agency cities of Anaheim, Fullerton, and Santa Ana. 6 Amended 12-14-10 4.1.2.2 Water Use Efficiency Program will be developed as a pay-as-you-go or a pay-for-participation basis instead of a "choice" basis. Functionally, however, there will be "choice" programs offered to all Member Agencies by agreement or through direct participation by retail consumers or others in the water service area. The Parties anticipate that the terms for the agreements between MWDOC and the Member Agencies will range between 3 and 5 years. The eight programs currently in operation include: Residential clothes washers d Sprinkler nozzles a SmarTimers a CIl Plumbing Fixtures Synthetic Turf • Hotel Program • Industrial Program Landscape Certification Program 4,2 Right to Submit Proposal. If a Member Agency Party does not participate in a MWDOC Choice Service pursuant to the provisions of this Agreement, including Section 2 above, and desires to participate in a substantially similar Service from another Member Agency Party, as set forth in a written proposal, such Member Agency Party shall deliver to MWDOC, no later than March W'of each year, a copy of the written proposal to receive such Service. MWDOC shall have thirty(30) days from receipt of such proposal to submit a scope and cost to provide the Service, for the Member Agency Party's consideration. 4.3 Core Programs shall be those listed in Table A. Any funding brought in via MWDOC efforts from its State or Federal advocacy efforts, except for those specifically being funded through a Project Participation Agreement, shall be available to all MWDOC Member Agencies via Core or Choice Programs, e.g., such as the Water Use Efficiency Program. 4.4 Overhead Costs shall be those listed in Table A. The Overhead costs are allocated over all Core and Choice services. Subject to Paragraph 5.3, if activities are ever added to or removed from the Amended 12-14-10 list of Core or Choice services, the commensurate proportion of Overhead costs will also be allocated accordingly. The determination of the Overhead cost percentage applicable to each Core and Choice service for any particular year shall be made during the budget preparation process and fixed for the entire budget year. 5. REVENUE COLLECTION The Parties agree that MWDOC should transition its current rate structure, which includes both a per retail connection charge and a per acre-foot charge, to a structure that includes only a per retail connection charge. Currently, MWDOC's revenue from water rate charges is approximately 65% on the per retail connection charge and 35% on the per acre-foot charge. As described below, MWDOC shall increase the percentage on the per retail connection charge gradually, reaching 100% in fiscal year 2015-16. 5.1 Fixed Charges. Commencing in fiscal year 2011 -2012, MWDOC will begin transitioning to a 100% fixed charge. In the first year of this process, 80% of MWDOC's water rate charges for its operating budget will be fixed, and 20%will be water charges. Each year for the next four years, MWDOC will increase the amount on fixed charges by 5%. 5.2 Method of Fixed Charges. MWDOC will continue to use the methodology in effect as of the Effective Date to define retail service connections independent of size as the method of passing charges to the Member Agencies on a fixed charge basis. 5.3 Designation of Core, Choice, and Overhead Services. The designations of services and activities set forth in (i) Section 2.1 and Table A for Core and Choice Service, in (ii) Paragraph 4.4 and Table A for Overhead Costs, and in (iii) Paragraph 5.2 for Method of Fixed Charges, shall carry a presumption of reasonableness and, therefore, shall remain unchanged for the term of this Agreement, unless changed by amendment in accordance with the provisions of Section 15. s Amended 12-14-10 6. INTERACTION OF ELECTED OFFICIALS 6.1 Elected Officials' Meeting. MWDOC will hold a semi-annual meeting for elected representatives of the Member Agencies and a GSWC officer or the officer's designee in October and April ("Elected Officials' Meeting") in addition to any other meetings, workshops, or assemblies open to those officials. The meetings shall be chaired by the President of the MWDOC Board and it is the intent of the Parties that the primary attendees.shall be members of their respective governing bodies. The forum will be used to discuss: ® MWDOC activities, policies, and budget(including reserves) ® MET activities and policies Statewide water resource issues 6 Strategies to increase Orange County's water supply reliability and to minimize Orange County water costs • Other topics of significant interest to the Orange County water community Beginning in March 2011 and each year thereafter, upon completion of the first DRAFT of the MWDOC Budget for the upcoming year, MWDOC will formally request comments on the budget from all 28 Member Agencies, as described in Section 2.2 above. MWDOC will report on the budget comments received from the Member Agencies at the Elected Officials' Meeting described herein. 6.2 Public Meetings. The Elected Officials' Meetings shall be noticed public meetings of MWDOC's Board. Each Member Agency participating in these meetings shall be responsible for compliance with the Brown Act by its own legislative body. (Government Code § 54950 etseq.) 7. SELECTION OF MET DIRECTORS 7.1 Recommended Appointments by MWDOC Member Agency Parties. Commencing with the first vacant MWDOC MET Director position following the Effective Date, the MWDOC Board will institute and follow the procedure set forth in this Section 7 for appointing MET Directors. 9 Amended 12-14-10 7.1.1 The MWDOC Administrative Code provides that the Board President shall nominate and the Board shall approve MET Directors. 7.1.2 Under the conditions and procedures established in this Agreement, the MWDOC Board will delegate limited nominating power to the MWDOC Member Agencies for two of MWDOC's MET Director positions. 7.1.3 When the first MET Director vacancy occurs following the Effective Date, the South County Agencies that are Member Agency Parties("South County Parties") may nominate a candidate of their choosing("MET Candidate")through a process to which they all agree, directly to the MWDOC President and Board. In the absence of agreement among the South County Parties, the nomination(s)shall be determined by a "one agency, one vote" process among the South County Parties. Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the South County Parties. Once filled, that seat will be designated, pursuant to this Agreement, as the "South County Seat" 7.1.4 When the second MET Director vacancy occurs following the Effective Date, the North County Agencies that are Member Agency Parties ("North County Parties") may nominate a MET Candidate of their choosing, through a process to which they all agree, directly to the MWDOC President and Board. In the absence of agreement among the North County Parties,the nomination(s) shall be determined by a "one agency, one vote" process among the North County Parties. Nominations shall be stated in a letter to the MWDOC Board President signed by authorized elected representatives of the North County Parties. Once filled, that seat will be designated, pursuant to this Agreement, as the "North County Seat". 7.2 The MWDOC Board shall consider each nominated MET Candidate seriously, in good faith and in the spirit of this Agreement and can only reject said MET Candidate for cause. The remaining MET Director seats shall continue to be filled pursuant to MWDOC's Administrative Code. MWDOC shall continue its practice of advising the Member Agencies when a vacancy occurs and soliciting potential candidates and input from ail Member Agencies for filling these seats. 7.3 All MWDOC MET Directors shall serve for an indefinite term pursuant to the MWDOC Administrative Code; provided, however, a MWDOC MET Director holding the North County Seat or the South County Seat may be removed by MWDOC only after MWDOC has convened an ad hoc committee to review that MWDOC MET Director's performance and the ad hoc committee has solicited and considered the input of the respective nominating area as provided below. If a vacancy occurs in the North County Seat or the South County Seat, the North or South County Parties, as established herein, may mare subsequent nominations to fill the vacancy in accordance with Sections 7.1.3 and 7.1.4, as applicable. The MWDOC Board President shall 10 Amended 12-14-10 consider appointment of an ad hoc committee to review the performance of MWDOC's MET Directors upon request of any MWDOC Board Member or Member Agency, or upon the MWDOC President's own determination. Such review, if any, may be conducted no more than once annually. If appointed, the ad hoc committee shall solicit input from the respective nominating areas on the performance of the North County and South County nominated MET Directors. Should the North County Parties or South County Parties deem it appropriate to remove their selected MET Director, they can make their request for removal to the MWDOC Board. The MWDOC Board will not unreasonably withhold action on such request(s). 8. COMPLIANCE WITH MWDOC ADMINISTRATIVE CODE Any MET Candidate nominated and appointed as provided herein must be familiar with MWDOC's Administrative Code and.express a willingness to comply with it. This includes, without limitation, meeting the criteria for a MWDOC MET Director established in Section 1500 of the MWDOC Administrative Code. 9. COMPLIANCE WITH LAW The nomination and appointment of any MET Candidate, as provided herein, must comply with applicable statutory and case law. 10. MET DIRECTOR ORANGE COUNTY CAUCUS MWDOC will schedule and conduct at its offices regular meetings of the MET Directors representing MET Member Agencies in Orange County. Meetings will be scheduled at least three (3) times per year to be determined by the Orange County MET Directors at the first meeting each year. The purpose of the meetings is to provide special access by all Member Agencies to the MET Directors representing Orange County. 11. REMEDIES AND ENFORCEMENT 11.1 Remedies in General. Except as set forth below, each Party shall have all remedies otherwise available to enforce the terms of the Agreement and to seek remedies for any breach hereof, including but not limited to the remedies set forth in Sections 11.2.3,11.5 and 11.6 of this Agreement. 11.2 Breach of the Agreement. 11 Amended 12-14-10 11.2.1 Any material breach or material violation of the Agreement shall be deemed a default under this Agreement. 11.2.2 In the event of an alleged material breach or material violation of the Agreement, the Parties agree to work together in good faith to resolve any disagreement using the following dispute resolution process: 11.2.2.1 The Party alleging a breach shall notify the other Parties of the basis for the allegation and the requested cure for the breach. 11.2.2.2 The alleged breaching Parry receiving notice of breach shall have 15 calendar days to respond. If the response acknowledges that a breach has occurred, the breaching Party shall have 30 days to cure such breach, provided that if such breach cannot be reasonably capable of being cured within said 30-day period, then the breaching Party shall not be in default of this Agreement provided that the breaching Party is diligently continuing to cure such default. 11.2.2.3 If the Party alleging a breach and the alleged breaching Party disagree with respect to whether a breach has occurred, they shall meet and confer in good faith toward a mutually satisfactory solution. The meet and confer shall be open to all Parties. 11.2.2.4 If the dispute cannot be resolved through the meet and confer process within 60 calendar days after the first meeting, the Party alleging a breach and the alleged breaching Party, along with any other Party that wishes to participate, shall engage in third party mediation, with the participating Parties to equally share mediation costs. Said mediation shall end no later than 90 calendar days after the completion of the original meet and confer process. No Party may file a lawsuit concerning the alleged breach until the mediation has ended. 11.2.2.5 In the event a lawsuit is filed after completion of the mediation concerning the alleged breach, the Parties' rights and obligations under this Agreement shall continue until one of three actions occurs: (1) the agreement continues as drafted, (2)the agreement is terminated; or(3)an amendment to the agreement is entered into pursuant to Section 15. 11.2.3 Any Party to this Agreement may, in addition to any other remedy, seek an order from a court specifically enforcing the 12 Amended 12-14-10 obligations of the Parties to the Agreement to comply with this Section 11.2. 11.3 Materia[ Breach in the Event of Certain Activities. The Parties to this Agreement have mutual interests in avoiding the time, expense, and uncertainty of either(a) legislative measures that would affect MWDOC's organizational form or(b)filing an application with the OCLAFCO for secession of a Party or detachment of a Party's territory from MWDOC. Consequently, the Parties to this Agreement agree that "material breach,"within the meaning of Section IL(a) shall include (but not be limited to) the following activities that any Party hereto may undertake during the term of this Agreement: 11.3.1 The submission of an application with OCLAFCO to reorganize or undertake an action that would result in a Party's secession or the detachment of all or a portion of a Party's territory, from MWDOC, or would result in any other material change in governance or structure affecting MWDOC. 11.3.2 The filing of any written letters or testimony with, or providing verbal testimony to, any committee or other body of the State Legislature in support of legislative measures that would (A) materially affect MWDOC's organizational form or change the governance of MWDOC, and (B)would result in secession or detachment of territory from MWDOC by any Member Agency. 11.4 An action constituting a material breach under Sections 2.2, 4, 5, 5, 7, 10, or 11.3 shall be subject to the dispute resolution provisions of Section 11.2.2. 11.5 Enforcement. Any Party may enforce compliance by a defaulting Party with the terms of this Agreement by, among other available remedies: 11.5.1 Filing a complaint for specific performance; 11.5.2 Filing an action to recover actual damages to which the notifying Party may be entitled for violation by the defaulting Party of the terms of this Agreement; 11.53 Filing an action to enjoin the violation, on an ex parte basis if necessary, by temporary or permanent injunction, without the necessity of proving either actual damages or the inadequacy of otherwise available legal remedies, or for other equitable relief; 13 Amended 12-14.10 11.5.4 Petitioning for a writ of ordinary or administrative mandate ordering the defaulting Party to cure; and/or 11.5.5 Petitioning for a writ of ordinary or administrative mandate ordering OCLAFCO not to process an application filed in contravention of this Agreement. 11.6 Injunctive and Temporary Relief Appropriate. The Parties acknowledge that breach of this Agreement may not be adequately remedied by monetary damages and could result in irreparable harm to the aggrieved Parties. Therefore, injunctive and temporary relief may be appropriate to ensure compliance with the terms of this Agreement. 12. TERM OF AGREEMENT 12.1 Effective Date. This Agreement shall be effective upon the date of execution by MWDOC, which shall execute the Agreement upon express approval of its Board ("Effective Date"). MWDOC shall inform all Parties by e-mail when that event occurs. 12.2 Subsequent Execution. Any Member Agency that executes this Agreement after the Effective Date shall, upon execution, become a full Party to the Agreement, with all the rights and obligations set forth herein. 12.3 Termination Date. This Agreement shall run for a term of five (5) years from the Effective Date, unless terminated as provided herein. This agreement may be extended by mutual agreement of all of the Parties hereto for subsequent term(s)five (5) years, or other period as mutually agreed to at the time of the extension. 13. OBLIGATIONS OF MEMBER AGENCIES 13.1 No OCLAFCO Application. During the term of this Agreement, none of the Member Agency Parties shall prepare, hire a consultant to prepare, or submit an application to OCLAFCO requesting reorganization or any action that would result in detachment of any territory from MWDOC or any other change affecting the governance, structure, or finances of MWDOC, unless agreed to in writing by MWDOC. In the event that the OCLAFCO undertakes proceedings, whether in response to an application or pursuant to its own discretionary powers, that reduces the territory within the boundaries or affects or changes the governance, structure or finances of MWDOC, these proceedings shall be considered a material breach of this Agreement by the Party or 14 Amended 12-14-10 Parties filing, supporting or in any way furthering the application except to the extent their actions are required by law. 13.2 No Legislative Activities. During the term of this Agreement, none of the Member Agency Parties shall pursue, support, or further any legislative measures that would affect MWDOCs organizational form, board or staff members, finances, exercise of powers, or governance or result in detachment of any territory from MWDOC, unless agreed to in writing by MWDOC. 13.3 Participation in Agreement. During the term of this Agreement, the Member Agency Parties, and each of them, shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement. 14. OBLIGATIONS OF MWDOC 14.1 No OCLAFCO Application. During the term of this Agreement, MWDOC shall not prepare, hire a consultant to prepare, or submit an application to OCLAFCO as described in Paragraph 13.1 relating to the governance, structure, or finances of MWDOC or any equivalent OCLAFCO application relating to the governance, structure, or finances of any of its Member Agencies, unless agreed to in writing by the affected Member Agency. 14.2 No Legislative Activities. During the term of this Agreement, MWDOC shall not pursue, support, or further any legislative measures that would affect any Member Agency's organizational form, board or staff members, finances, exercise of powers, or governance or result in detachment of any territory from the Member Agency, unless agreed to in writing by the Member Agency, 14.3 Participation in Agreement. During the term of this Agreement, MWDOC shall contribute staff time and resources as required to participate and contribute in good faith to the activities and changes discussed in this Agreement. 15, AMENDMENT OF AGREEMENT 15.1 Any amendment, alteration, or variation of any provision of this Agreement("Amendment")will not be valid unless made in writing and approved as provided in this Section. 15.2 The Parties acknowledge that the process of obtaining initial approvals and execution of this Agreement has required a substantial investment of public resources and time and that the same process should not be required for subsequent Amendments to the Agreement that are proposed without objection. For this reason, Amendments to the Agreement may be made as provided in this section. 15.2.1 An Amendment to the Agreement proposed by MWDOC shall be distributed by MWDOC to all Parties signing this 15 Amended 12-14-10 Agreement for a 60-day review period. 15.2.2 Any and all comments and objections to the Amendment shall be provided by the Parties to MWDOC and the remaining Member Agency Parties before the conclusion of the 60-day review period. 15.2.3 If no objections are received by the conclusion of the 60-day review period, the Amendment shall be valid and binding on the Parties. Upon this occurrence, MWDOC will provide a copy of the Amendment to all Parties. 15.2.4 If any objections are received within the review period, MWDOC may submit the proposed Amendment to the Parties for signatures, and if the proposed Amendment is executed by MWDOC and all of the Member Agency Parties, the Amendment shall be valid and binding on the Parties. Upon this occurrence, MWDOC will provide a copy of the Amendment to all Parties. 15.3 An Amendment to the Agreement proposed by a Party other than MWDOC shall be submitted in writing to MWDOC. Upon receipt of the proposed Amendment, MWDOC shall then follow the procedures set forth in section 15.2 above. 16. NO ADMISSION BY ANY PARTY The Parties acknowledge that statements made by the Parties during negotiation of this Agreement, statements made in this Agreement, and all rights and obligations that arise from this Agreement were and are in furtherance of the goal of resolving issues between the Parties without the need for administrative or judicial proceedings, including possible OCLAI=CO proceedings and litigation. Neither any statement made during negotiation of this Agreement nor any provision of the Agreement itself shall constitute an admission by a Party or be offered as evidence or included in any record of proceedings in any future administrative or judicial proceeding. 17. GENERAL PROVISIONS 17.1 All Parties are deemed to have participated in the drafting of this Agreement, and any rule of law(including, but not limited to, Civil Code Section 1654)or legal principle that would require interpretation of this Agreement against the drafter hereto shall not apply and is waived by the Parties. This Agreement may be signed in multiple counterparts for convenience of the Parties. 17.2 This Agreement will inure to the benefit of and be binding upon all Parties and their respective successors and assigns. 17.3 This Agreement will be deemed a contract made under the laws of 16 Amended 12-14-10 the State of California and for all purposes will be interpreted in accordance with such laws. The Parties hereby agree and consent to the exclusive jurisdiction of the courts of the State of California. 17.4 This Agreement constitutes the entire agreement among the Parties. This Agreement supersedes any and all other understandings or agreements, either oral or in writing, among the Parties with respect to the subject matter hereof and contains all of the covenants and agreements among them with respect to said matters; and each Party acknowledges that no representation, inducement, promise of agreement, oral or otherwise, has been made by any other Party or anyone acting on behalf of any other Party that is not embodied herein. 17.5 If any action at law or equity, including any action for writ of mandate or injunctive relief, is brought to enforce or interpret the provisions of this Agreement, the prevailing Party(ies) shall be entitled to its or their reasonable attorney's fees and costs as against the Party(ies)that did not prevail in that action or proceeding. 17.6 All activities undertaken pursuant to this Agreement must be in compliance with all applicable state and federal laws and regulations. 17.7 In the event one or more of the provisions contained in this Agreement is held invalid, illegal or unenforceable by any court of competent jurisdiction, such portion shall be deemed severed from this Agreement and the remaining parts of this Agreement shall remain in full force and effect as though such invalid, illegal, or unenforceable portion had never been a part of this Agreement. 17.8 All communications set forth in this Agreement shall be in writing and transmitted to and among the Parties in a manner that is consistent with the custom and practice of MWDOC and its Member Agencies then in effect. Any computations of time shall start from 5:00 PM on the day of receipt. IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the respective dates shown below. Mayor, City of San Clemente Date 17 Amended 12-14-10 Mayor, City of San Juan Capistrano Date President, EI Toro Water District Date 18 Amended 12-14-10 President, Irvine Ranch Water District Date President, Laguna Beach County Water District Date President, Municipal Water District of Date Orange County President, Moulton Niguel Water District Date President, Santa Margarita Water District Date President, South Coast Water District Date 19 Amended 12-1410 President, Trabuco Canyon Water District Date Mayor, City of Brea Date Mayor, City of Buena Park Date Mayor, City of Fountain Valley Date Mayor, City of Carden Grove Date Mayor, City of Huntington Beach Date 20 Amended 12-14-10 Mayor, City of La Hamra Date Mayor, City of La Palma Date Mayor, City of Newport Beach Date Mayor, City of Orange Date Mayor, City of Seal Beach Date Mayor, City of Tustin Date 21 Amended 12-14-10 Mayor, City of Westminster Date President, East Orange County Water District Date President, Emerald Bay Service District Date Officer, Golden State Water Company Date President, Mesa Consolidated Water District Date President, Orange County Water District Date 22 Amended 12-14-10 President, Serrano Water District Date President, Yorba Linda Water District Date Z1Wsers DatalggoodreaulMWDOC13381afcoissueslagmtslMWDOCAgreement markupl l-11—IOfinal docxl21410rgb.docx 23 FINAL-9-17-10 Table A - MWDOC Breakdown of Services/ActivitlesCCosts �. C©re''Servic s �a z �.. .. o1c�.Sergices , Owbead:.Costs . Board Compensation&Benefit Water Use Efficiency Salary charged to overhead Retiree Costs • Residential clothes washers function(vacation,sick leave Legal Costs • Sprinkler nozzles and holidays) Board Elections • Personnel development SmarTimers Legal costs charged to Accounting and General Admin s CII Plumbing Fixtures overhead function MET Representation • Synthetic Turf Employee benefits • MET Director Support • Hotel Program Personnel/staff development • MET policy analysis,programs and special s Industrial Program Information technology projects . Landscape Certification Conference employee s MET operations,water rates and accounting Program Travel&Accommodations Staff time for MWDOC"s Water Use Efficiency Includes marketing materials for employee Programs Manager WUE activities,staff time, Automotive/Mileage/"Toll � Governmental Affairs overhead and grant funds(MET Office maintenance • In-house staff for legislative info and other) • WACO,ISDOC and other support Governmental Relations Rents&Leases Office supplies • Federal lobbyist for countywide funding • Any project or program legislative or grant support Insurance expenses • State lobbyist for countywide legislative,grant on choice activities— Utilities--telephone funding and policy access Townsend Public Affairs • Local lobbyist for Board of Supervisors Miscellaneous expenses i Y p Specific Programs Professional fees for overhead Public Affairs • School program activities � i • Coordination with MET,other regional and local • South Orange Coastal Software support retailers Ocean Desal Project Computers/software ! • Basic communications functions-media outreach o, Federal lobbying and inquiries,water information and messaging, for SOCODP- MWDOC website Barker • MWDOC newsletter(e-currents) o Federal lobbying • Countywide surveys as appropriate far SOCODP— • Countywide water awareness in coordination with Townsend retail agencies • Support for Poseidon Desal Research.._support for Center for Demographic Project Research • Other Project specific Water Surinlv Planning studies • Coordination among agencies • Non-countywide issue • Water use tracking and projections studies • Water supply analysis • Regulatory compliance issues • Water trends analysis • Countywide studies Water Emergency Response Organization of Orange County(WE ROC)--MWDOC contribution 24 DRAFT MWDOC Proposed Choice Budget and Increased Meter Charge San Juan Capistrano Fiscal Year 2011-12 Certified Meters 11,034 Projected Acre-Foot Sales 4,070 Water Use Efficiency Choice $ 23,212 School Program Choice $ 3,364 South Coastal Desal Choice $ 19,668 Poseidon Beach Desal Choice $ - Choice Budget $ 46,244 Proposed . ......... ... .�Iacre� MWDOC Meter Charge $ 6,50 $6.25 $6.75 $7.25 $7,50 $7.75 MWDOC Increment Rate $ 7.50 $4,25 $3.00 $2.00 $1,00 $0.00 Retail Meter Charge $ 71,721 $ 68,963 $ 74,480 $ 79,997 $ 82,755 $ 85,514 Water Increment Charge $ 30,525 $ 17,298 $ 12,210 $ 8,140 $ 4,070 $ - Choice Budget $ - $ 46,244 $ 46,244 $ 46,244 $ 46,244 $ 46,244 Total $ 102,246 $ 132,504 $ 132,934 $ 134,381 $ 133,069 $ 131,758 Difference $ - $ 30,258 $ 30,688 $ 32,135 $ 30,823 $ 29,512 Municipal Water District of Orange County ATTACHMENT 2 Christy Jakl From: Justin Kirk Sent: Tuesday, September 13, 2011 11:03 AM To: Christy Jakl Cc: West Curry Subject: RE: Status? MWDOC School Education Program Christy, The last that I heard is that MWDOC was to forward the City the final approved agreement for the choice programs after the City had adopted.To date I have not been provided with a copy of the final agreement. I copied West on this email to see if has any information. Based upon his response I will follow up with MWDOC on this item. Senior Management Analyst Utilities Department City of San Juan Capistrano From: Christy Jakl Sent:Tuesday, September 13, 20118:47 AM To:Justin Kirk Subject: RE: Status? MWDOC School Education Program Importance: High Hey Justin, May I have a status update on this please! Christi Jakl Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949)443-6310 1 (949)493-1053 fax From: Christy Jakl Sent: Thursday, September 08, 201112:54 PM To: Justin Kirk Subject: Status? MWDOC School Education Program Hi Justin, What is the status of the City Council approved MWDOC School-Education Program? I need to final version for the Mayor's signature. Thank you!! Chi-isN RAI Deputy City Clerk 1 u 'u City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949)443-6310 (949)493-1053 fax 2 Christy JAI From: Christy Jakl Sent: Thursday, September 08, 2011 12:54 PM To: Justin Kirk Subject: Status? MWDOC School Education Program Hi Justin, What is the status of the City Council approved MWDOC School Education Program? I need to final version for the Mayor's signature. Thank you!! Christ? Jaki Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949)443-6310 1 (949)493-1053 fax 1 Christy Jakl From: Justin Kirk Sent: Thursday,April 21, 2011 10:54 AM To: Christy Jakl Subject: RE: MWDOC Agreement Christy, I am waiting for the final approved agreement from MWDOC. It was reviewed and approved yesterday by the MWDOC board, and emailed MWDOC but have yet to receive confirmation of when it will be transmitted,once it is I will forward the document to the Clerk's office. Senior Management Analyst Utilities Department City of San Juan Capistrano From: Christy Jakl Sent:Thursday,April 21, 201110:53 AM To:Justin Kirk Subject: MWDOC Agreement Hi Justin, Your agreement with MWDOC was approved the other night with mentioned changes. Please forward the necessary copies to our office for signature. Thanks! Christi J.-Al Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949) 443-6310 1 (949)493-1053 fax Christy JAI From: Christy Jakl Sent: Thursday,April 21, 2011 10:53 AM To: Justin Kirk Subject: MWDOC Agreement Hi Justin, Your agreement with MWDOC was approved the other night with mentioned changes. Please forward the necessary copies to our office for signature. Thanks! Christ? JAI Deputy City Clerk City of San Juan Capistrano 32400 Paseo Adelanto San Juan Capistrano, CA 92675 (949) 443-6310 1 (949)493-1053 fax 1