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Ordinance No. 9,552ORDINANCE NO. 9552
® AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,
APPROVING THE WATER SUPPLY CONTRACT — TREATED WATER BETWEEN
THE BAYTOWN AREA WATER AUTHORITY AND COUNTRY TERRACE
WATER CO., INC.; AND PROVIDING FOR THE EFFECTIVE DATE THEREOF.
****************************************************** * * * * * * * * * * * * * * * * * * * * * * * * * * * * * **
WHEREAS, Country Terrace is located on Wallisville Road between Thompson Road and Wade
Road and has a population of approximately 1,800 and 323 connections; and
WHEREAS, on September 19, 2001, the Board of Directors of the Baytown Area Watei
Authority ( "BAWA ") approved the Water Supply Contract — Treated Water (the "Contract ") with
Country Terrace contingent upon a capital buy -in fee of $88,748 and approval from the City of Houston;
and
WHEREAS, on April 12, 2002, BAWA received a majority of the capital buy -in fee, namely
$79,873; and
WHEREAS, on November 25, 2002, the City of Houston approved the Contract; and
WHEREAS, on December 18, 2002, the BAWA Board of Directors approved a payment
arrangement for the balance of the capital buy -in fee of $8,875 over a one -year term; and
WHEREAS, pursuant to Chapter 600, Acts of the 63`' Legislature, Regular Session, 1973, the
City Council of the City of Baytown must approve the Contract; NOW THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section l: That the City Council of the City of Baytown, Texas, hereby approves the Water
Supply Contract — Treated Water between the Baytown Area Water Authority and the Country Terrace
Water Co., Inc. A copy of such contract is attached hereto as Exhibit "A," and incorporated herein for all
intents and purposes.
Section 2: This ordinance shall take effect immediately from and after its passage by the
City Council of the City of Baytown.
INTRODUCED, READ and PASSED by the affirmative vote of the City Council of the City of
Baytown this the 10`h day of April, 2003.
PETE C. ALFARO, M` yor
ATTEST:
Z W /A
G :Y W. SMITE, City Clerk
• APPROVED AS TO FORM:
Gj
pre
4KNACI0 RAMIREZ, SR. .ty Attorney
F:\Karen\Files \City Council\ Ordinances\ ApproveBAWAContractWCountryTerrace.doc
I
Water Supply Contract -- Treated Water
Country Terrace Water Co.
STATE OF TEXAS
COUNTY OF HARRIS
This Water Supply Contract -- Treated Water, hereinafter referred to as the "Contract," is
made and entered into on the date herein after last specified by and between the Baytown Area Water
Authority, a governmental agency and a body politic and corporate of the State of Texas, created
pursuant to Chapter 600, Acts of the 63rd Legislature, Regular Session, 1973, hereinafter referred to
as `BAWA," and the Country Terrace Water Co., Inc., a Texas corporation having a mailing address
of P.O. Box 24433, Houston, Texas 77229, hereinafter referred to as "CTW."
WHEREAS, BAWA has the right under a contract with the City of Houston to buy untreated
water from the City of Houston; and
WHEREAS, BAWA has constructed and will continue to repair, construct and modify
certain facilities to treat and deliver water to its customers at several points of delivery; and
WHEREAS, CTW has constructed or contracted with BAWA to construct certain facilities to
enable CTW to receive treated water from BAWA; and
WHEREAS, BAWA desires to sell quantities of treated water to CTW; and
WHEREAS, CTW, subject to the terms and conditions contained herein, desires to purchase
from BAWA its treated water; and
WHEREAS, BAWA and CTW have found, and do hereby find, that BAWA and CTW are
authorized by the laws of the State of Texas to enter into a contract for the sale of water upon such
terms and for the period of time hereinafter set forth; and
WHEREAS, CTW is authorized to enter into a contract for the purchase of treated water
from BAWA pursuant to Section 54.218 of the Texas Water Code;
NOW THEREFORE, for and in consideration of the premises and the mutual covenants and
agreements herein contained, the parties hereto do hereby mutually agree as follows:
ARTICLE I
DEFINITIONS
Unless a different meaning or intent clearly appears from the context, the following words
• and terms shall have the meanings specified in this Article, respectively:
EMU A
1.01 "Act" means Chapter 600, Acts of the 63rd Legislature, Regular Session, 1973.
1.02 "BAWA Contract" means the Water Supply Contract between the City of Houston
and Baytown Area Water Authority, dated October 24,1994, between BAWA, as buyer,-and
the City of Houston, Texas, as seller, a copy of which is attached hereto and incorporated
herein for all intents and purposes.
1.03 `Beginning Date" shall mean the date that CTW begins receiving treated water from
BAWA under this Contract or the effective date hereof, whichever is later. Such date may
occur after the effective date of this Contract as defined in Article IX. Provided, however,
that if CTW does not begin receiving treated water within one year of the effective date
hereof, BAWA shall be under no further obligation to supply CTW with treated water.
1.04 "CTW's Facilities" shall mean facilities constructed by CTW to enable CTW to
receive treated water.
1.05 "Contract Quantity" shall mean the maximum quantity of treated water that BAWA
agrees to reserve and sell to CTW pursuant to Section 2.01 herein.
1.06 "Contract Term" is defined in Article IX.
1.07 "General Manager" shall mean the General Manager of the Baytown Area Water
Authority or any successor agency and all persons designated by the General Manager to
administer the sale and delivery of water to CTW.
1.08 "MGD" is an abbreviation for million gallons of water per day. As used in this
contract, "MGD" refers to a quantity of water during a period of time expressed for
convenience in terms of an average daily quantity during a calendar month (unless a different
period of time is specified). The volume of two MGD for a calendar month, for example, is
calculated as follows: Two million gallons multiplied by the number of days in such
calendar month.
1.09 "Point of Delivery" shall mean those delivery points as indicated on Exhibit "A,"
which is attached hereto and incorporated herein for all intents and purposes, to which
BAWA agrees to deliver treated water to CTW.
1.10 "Point of Measurement" shall mean the location of the meter at which CTW's
consumption of water is measured, more particularly described in Exhibit "A."
1.11 "Prof ect" means the property, works, facilities and improvements, whether previously
existing or to be made, constructed or acquired, within or without the boundaries of BAWA,
necessary
(a) to acquire surface water supplies from sources both within and without the
boundaries of BAWA, including particularly the sources provided by
BAWA's Contract (herein defined),
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(b) to conserve, store, transport, treat and purify untreated water purchased by
BAWA pursuant to BAWA's Contract, and
(c) to distribute, sell and deliver treated water to CTW pursuant to the terms of
the Contract.
1.12 "Service Area" shall mean the area within the boundaries more particularly described
in Exhibit "B," which is attached hereto and incorporated herein for all intents and purposes.
1.18 "TNRCC" shall mean the Texas Natural Resource Conservation Commission or its
successor.
1.13 "Water" shall mean potable water meeting the minimum drinking water standards
prescribed by Texas Department of Health Resources and Texas Natural Resource
Conservation Commission, and their successor agencies.
ARTICLE H
SALE AND DELIVERY OF WATER
2.01 Subject to the terms and conditions of this Contract, during the Contract Tenn,
BAWA agrees to sell and deliver (or cause to be delivered) to CTW, all of CTW's water
requirements of treated water at the Points of Delivery at daily rates of delivery; and CTW agrees to
purchase from BAWA, all of CTW's treated water requirements for resale at the Points of Delivery
during the term of this Contract. It is expressly agreed to and understood that BAWA shall not be
obligated to deliver to CTW treated water in excess of the Contract Quantity which shall be the
monthly average per day of 0.110 MGD.
2.02 The Points of Delivery for treated water sold under this-contract shall be designated in
writing by CTW; provided, however, BAWA reserves the right to reject any Point of Delivery
designated by CTW which would affect, interfere with or increase the cost of any other facilities or
operations which BAWA might wish to construct or implement, or plan to construct or implement,
or which would adversely affect BAWA's ability to provide treated water to any of its customers.
Both BAWA and CTW agree that the Points of Delivery shall be those indicated on Exhibit "A,"
which is attached hereto and incorporated herein for all intents and purposes. Additionally, CTW
may give BAWA notice in writing of any additional or change in Point(s) of Delivery designated by
CTW, and BAWA agrees to accept or reject such Point(s) of Delivery by a response in writing within
thirty (30) days after BAWA's receipt of the notice.
2.03 Treated water may be delivered to CTW from any source or combination of sources
available to BAWA.
•
2.04 The treated water to be delivered shall meet minimum standards prescribed by the
State of Texas for municipal purposes (as such term is defined by the TNRCC in its rules) and shall
be only used by CTW within the Service Area.
2.05 If CTW wishes to reserve for itself additional monthly quantities of treated water,
CTW must notify BAWA in writing of CTW's desire to do so. The General Manager may, at his
discretion after considering the treated water requirements of CTW and BAWA's obligations and
commitments, increase the quantity of treated water supplied to CTW; provided, however, that
BAWA shall be under no obligation to deliver treated water in excess of Contract Quantity. BAWA
may, at its discretion, discontinue delivery of such additional monthly requirements of treated water
by giving CTW thirty (3 0) days' written notice.
2.06 CTW shall own and be responsible for all lines connected to BAWA's transmission
line, beginning at the point where the metering device is installed to meter sales to CTW.
ARTICLE III
CONSTRUCTION OF THE PROJECT
3.01 CTW agrees to proceed promptly with the acquisition and construction of the Project
with monies lawfully available for such purpose after obtaining written approval of the plans and
specifications from BAWA. However, such approval shall not be deemed to be for the benefit of
CTW, bur rather just for the protection of BAWA's system.
3.02 If CTW desires to materially revise the scope of or the plans and specifications for the
Project, such proposed revisions shall be submitted to BAWA for approval. If BAWA approves
such revisions, the Project shall be modified.
ARTICLE IV
RATES AND PRICES
4.01 As a contribution to the capital investment of BAWA and in consideration for
connection of CTW's work system, CTW shall. pay EIGHTY -EIGHT THOUSAND SEVEN
HUNDRED FORTY -EIGHT AND N01100 DOLLARS ($88,748.00), within thirty (30) days ofthe
funding of the first issue of capital improvement bonds by CTW. Notwithstanding the above,
however, CTW is obligated and hereby promises to pay or cause to be paid to BAWA said amount
no later than one year from the date of this contract. Additionally in order to further secure CTW's
assurance of the availability of such funds, CTW will provide or cause to be provided to BAWA an
irrevocable letter of credit, payable to BAWA, in a form acceptable to BAWA in the amount of
EIGHTY -EIGHT THOUSAND SEVEN HUNDRED FORTY -EIGHT AND NO /100 DOLLARS
($88,748.00), so that, should BAWA be required to enlarge or expand its water treatment facilities to
provide treated water to CTW in the amounts set forth herein prior to the payment to BAWA, by
CTW of EIGHTY -EIGHT THOUSAND SEVEN HUNDRED FORTY -EIGHT AND N0 1100
DOLLARS ($88,748.00), described above, then, in such event, the Letter of Credit can be drawn
4
W
upon by BAWA in such amounts and installments necessary in order to provide funds for such
enlargement or expansion of water treatment facilities in the amount of CTW's pro rata share of any
such capital expansion costs. BAWA shall also be entitled to draw upon the full amount of such
letter of credit of the full amount of the capital investment contribution has not been paid within one
year of the date of this Contract.
4.02 Whenever CTW's consumption shall exceed Contract Quantity by ten percent (10 %),
a five percent (5%) surcharge shall be charged against that portion of the consumption that exceeds
the Contract Quantity. Provided, however, this surcharge shall not apply to any increase in the
quantity of treated water granted by the General Manager pursuant to Section 2.05 hereof.
4.03 All water sold and delivered by BAWA to CTW for which CTW is obligated to pay
hereunder shall be sold to CTW at the rate of $1.29 per one thousand gallons.
4.04 The amount of water delivered to CTW shall be measured by the metering equipment
located at the point of delivery.
4.05 Additionally, CTW understands and agrees that BAWA may at anytime, by' order
duly enacted, increase or change the price or prices for treated' water as set forth in this article;
provided, however that except where an independent rate analysis conducted by a qualified concern
indicates that certain rate increase is required, the price or prices for treated water shall not be
increased percentagewise to CTW during any twelve (12) month period of this contract in excess of
the percentage rate increase in BAWA's water rates to other purchasers of treated water during the
same period.
ARTICLE V
REPORTS
5.01 Within fifteen (I S) days after the end of each quarterly period during the tern of this
Contract, CTW shall furnish BAWA with a statement under oath showing the quantities and sources
of all water for use or resale by CTW.
ARTICLE VI
MEASURING EQUIPMENT
6.01 At its own cost and expense, CTW shall furnish and install at the Point of Delivery
hereunder, measuring equipment properly equipped with meters, totalizers and devices of standards
type for measuring and recoding accurately the quantity of water delivered under this Contract. The
meters shall have a capacity for measuring the quantity of water delivered within an accuracy
tolerance of two per cent (2 %) plus or minus for a given rate of flow. CTW shall also install, operate
and maintain as required by BAWA, pressure regulating devices and equipment. Such measuring
equipment shall be approved by BAWA and after BAWA's approval of the installation, same shall
become property of BAWA. All measuring equipment shall be owned by BAWA, even when
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M
purchased by CTW, and all measuring equipment shall be located at the Point of Delivery as shown
on Exhibit "A."
6.02 During all reasonable hours as determined by the General Manager in his sole
discretion, BAWA, the City of Houston, and the Coastal Water Authority of Texas shall have access
to the measuring equipment. CTW may have access to all records pertinent to determining the
measurement and quantity of treated water actually delivered hereunder, but the reading of the
measuring equipment for purposes of billing shall be done by BAWA.
6.03 After approved installation thereof, BAWA shall maintain the measuring equipment
within the accuracy tolerance specified in Section 6.04 by periodic tests. BAWA shall conduct such
tests at least once every twelve (12) months and shall notify CTW at least forty-eight (48) hours in
advance of the time and location at which tests are to be made. BAWA agrees to properly test said
measuring equipment at BAWA's cost when requested to do so by CTW once every twelve (12)
months. If CTW requests an additional test within twelve (12) months, BAWA shall charge CTW an
amount equal to BAWA's costs to perform such test unless the test reveals that the equipment
registers one hundred two percent (102 %) or more for a given flow rate. In addition, CTW shall
have the right to independently check, at its own cost, said measuring equipment at any time upon
forty-eight (48) hours' notification to the General Manager and opportunity for the General Manager
to witness such tests.
6.04 Should any test of the measuring equipment in question show that the equipment
registers either more than one hundred two percent (102 %) or less than ninety-five percent (95 %) of
the water delivered for a given flow rate, the total quantity of water delivered to CTW will be
deemed to be the average daily consumption as measured by the measuring equipment when in
working order, and the meter shall be calibrated to the manufacturer's specifications (in the case of
Venturi meters) or the AWWA specifications (for all other types of meters) for the given rate of
flow, or replaced by BAWA with accurate measuring equipment that is tested before it is placed in
service. The adjustment shall be for a period extending back to the time when the inaccuracy began,
if such time is ascertainable; and if such time is not ascertainable, for a period extending back to the
last test of the measuring equipment or one hundred twenty (120) days, whichever is shorter. If, for
any reason, the measuring equipment is out of service or out of repair and the amount of treated
water delivered cannot be ascertained or computed from the reading thereof, water delivered during
the period shall be estimated and agreed upon by the parties hereto on the basis of the best data
available.
As used in this section, the expression "given rate of flow" means one of the following
selected by the General Manager:
(a) the total quantity of water delivered during the preceding period (usually a calendar
month) as reflected by the totalizer, converted to gallons per minute;
(b) high, low and intermediate rates of flow in the flow rate, as reflected by the flow
40 recording devices;
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9 (c) the applicable Contract Quantity for the current period, usually a calendar month,
converted to gallons per minute; or
•
(d) AWWA- specified test flow rates for that size and type of meter.
6.05 In the event of a dispute between BAWA and CTW as to the accuracy of the testing
equipment used by BAWA to conduct the accuracy test, an independent check may be mutually
agreed upon between CTW and BAWA and shall be conducted by an independent measuring
equipment company suitable to both CTW and BAWA. The cost of such test shall be at CTW's sole
expense.
6.06 CTW may install, at its own cost and expense, such check meters in CTW's pipeline
or canal as may be deemed appropriate, but BAWA shall have the right of ingress and egress to such
check meters during all reasonable hours; provided, however, that billing computations shall be on
the basis of the results of the measuring equipment set forth above.
ARTICLE VII
BILLING AND PAYMENT
7.01 As used in this Article VII, the term "day" shall mean a period of twenty-four (24)
consecutive hours beginning at a mutually agreed -upon time on one calendar day and ending at the
same time on the next succeeding calendar day, and the term "month" shall mean a period beginning
at a mutually agreed -upon time on the first day of a calendar month and ending at the same time on
the first day on the next succeeding calendar month.
7.02 The measuring equipment shall be read on the day at the end of each month (or at
such period of frequency arranged between the parties) and at a mutually agreed upon time, or as
near thereto as practicable.
7.03 The quantities of treated water for which payment is due by CTW hereunder in any
month shall be the total quantity of treated water delivered to CTW in such month determined by the
measuring equipment described in Article VI hereof.
7.04 BAWA shall bill CTW at CTW's address within ten (10) days after the read date by a
statement showing the quantity of water used during the preceding month. Payment shall be due and
payable to BAWA at its offices in Baytown, Harris County, Texas, on or before the twentieth day
after receipt of such statement.
7.05 Should CTW fail to tender payment of any amount when due, interest thereon shall
accrue at the rate of ten percent per annum from the date when due until paid and CTW shall be
deemed to be in default.
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•
ARTICLE VIII
TITLE TO AND RESPONSIBILITY FOR WATER
8.01 As between BAWA and CTW, BAWA shall be in exclusive control and possession
of, and solely responsible for, all treated water deliverable hereunder and solely responsible for any
damage or injury caused thereby until the same shall pass through the Point of Delivery and
thereafter, CTW shall be in exclusive control and possession thereof and solely responsible for any
injury or damage caused thereby.
8.02 BAWA MAKES NO WARRANTY, EXPRESS OR IMPLIED, REGARDING THE
QUALITY OR DELIVERY PRESSURE OF TREATED WATER, INCLUDING THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
8.03 With respect to all water handling facilities located between the Point of Delivery and
the Point of Measurement, BAWA and CTW specifically agree:
(a) that all such facilities, other than the measurement equipment itself, shall be and
remain the property of CTW subject to the terms of this Contract;
(b) that CTW shall take all reasonable steps to maintain such facilities and to prevent
leaks or discharges from such facilities;
(c) that CTW shall repair any such leak or discharge at once upon receiving notice
thereof and pay BAWA the price of any water lost by reason of such a leak or
discharge;
(d) that CTW shall correct or repair any damage caused by any such leak or discharge
and shall hold BAWA harmless from and against any such damage and claims
therefore;
(e) that CTW shall alter or relocate, at its sole cost, any such facilities whenever BAWA
shall reasonably request in writing that the same be done; and
(f) that CTW shall promptly remove such facilities and restore their locations to their
pre- existing conditions whenever this Contract is no longer in effect and BAWA so
requests in writing.
ARTICLE IX
TERM
This Contract shall be in force and effect beginning on the date of execution by BAWA until
December 31, 2021, at 8:00 a.m.
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• I♦
ARTICLE X
PERFORMANCE BY BAWA AND CTW
10.01 BAWA covenants and agrees that it will not contract for the sale of water to other
users to such an extent or for such quantities as to impair BAWA's ability to perform fully and
punctually its obligations to CTW under this Contract. In case of temporary shortage of water,
notwithstanding BAWA's compliance with the portions of this Article X, BAWA shall distribute the
available supply as provided by the laws of the State of Texas, particularly Section 11.039(a) of the
Texas Water Code, as amended.
10.02 Pursuant to the Amendatory Contract entered into by the City of Houston and the San
Jacinto River Authority, which is incorporated herein by this reference, CTW covenants and agrees
that it shall take treated water for the purpose of distribution through its system, and such water shall
be used for municipal purposes (as such term is defined by TNRCC Rules, currently in effect or as
hereinafter amended) and for no other purposes. CTW covenants and agrees that such treated water
shall be sold, distributed or used and ultimately consumed only for residential household or other
strictly municipal purposes exclusively within the Service Area. No extension of these boundaries
may be made by CTW without written consent of BAWA as well as the written consent of the San
Jacinto River Authority and City of Houston, when required pursuant to the Water Supply Contract
between the City of Houston and BAWA, dated October 24, 1994. CTW agrees to include
covenants similar to those contained in this Section 10.02 in any sales or contracts for sale of water
by CTW to any other entity. CTW agrees to submit the wording of such covenants to BAWA for the
written approval of BAWA and all other required entities prior to entering into such contracts.
CTW understands and agrees that BAWA, the City of Houston and/or the San Jacinto River
Authority may enforce the covenants contained in Section 10.02 herein by an action brought directly
against CTW. In the event that BAWA and/or the City of Houston maintains any legal proceeding to
enforce such covenants, CTW agrees to indemnify BAWA and/or the City ofHouston in the amount
of all expenses relating to the legal proceeding, including, but not limited to, costs of court and
reasonable attorneys' fees.
10.03 CTW acknowledges that according to the terms of the contract between BAWA and
the City of Houston, BAWA may be liable to the City of Houston and/or the San Jacinto River
Authority for monetary damages in the event that CTW (or any purchaser of water from or through
CTW) fails to comply with the restrictions and limitations on the sale of water set out in Section
10.02 herein. CTW acknowledges that such monetary damages would amount to seventy-five
percent (75 %) of the consideration or revenue received by BAWA for the estimated amount of water
distributed, sold or used in violation of such restrictions or limitations, plus all litigation expenses,
reasonable attorney's fees, and all other remedies available to the City of Houston and/or the San
Jacinto River Authority. CTW hereby agrees to totally indemnify, defend, and save BAWA harmless
from and against any such expenses and liability which BAWA might incur or any loss BAWA
might suffer, as a result of any failure by CTW, or any purchaser of water from or through CTW, to
comply with such restriction and limitation. CTW agrees that in the event that CTW furnishes or
sells water or water services to a third party that in turn will furnish water to the ultimate consumer,
CTW shall include covenants in any such sales or contracts for sale of water to such third party(ies)
E
to ensure that said other entity(ies) will likewise indemnify, hold harmless, and, defend BAWA.
CTW agrees to submit the wording of such covenants for the approval of BAWA prior to entering
into such contracts.
CTW acknowledges that according to the terms of the contract between the City of Houston
and the San Jacinto River Authority, the City of Houston may be liable to the San Jacinto River
Authority for monetary damages in the event that CTW (or any purchaser of water from or through
CTW) fails to comply with the restrictions and limitations on the sale of water set out in Section
10.02 herein. CTW acknowledges that such monetary damages would amount to seventy-five
percent (75 %) of the consideration or revenue received by the City of Houston for the estimated
amount of water distributed, sold or used in violation of such restrictions or limitations, plus all
litigation expenses, reasonable attorney's fees, and all other remedies available to the San Jacinto
River Authority. CTW hereby agrees to fully indemnify, defend, and save the City of Houston
harmless from and against any such expenses and liability which the City of Houston might incur or
any loss the City of Houston might suffer, as a result of any failure by CTW, or any purchaser of
water from or through CTW, to comply with such restrictions and limitations. CTW agrees that in
the event that CTW furnishes or sells water or water services to a third party that in turn will furnish
water to the ultimate consumer, CTW shall include covenants in any such sales or contracts for sale
of water to such third party(ies) to ensure that said other entity(ies) will likewise indemnify, hold
harmless, and defend the City of Houston. CTW agrees to submit the wording of such covenants for
the approval of BAWA and the City of Houston prior to entering into such contracts.
10.04 CTW agrees to maintain, at its sole expense, its water wells, if any, in good repair and
working order to facilitate the use of such water wells as an emergency source of supply, if required,
should BAWA be unable to deliver the Contract Quantity of water for any reason. CTW shall bear
all costs of maintaining and supplying such emergency sources of supply.
ARTICLE XI
ENVIRONMENTAL CONSIDERATIONS
11.01 On or before the first anniversary of the effective date of this contract; CTW shall
approve, implement and throughout the term hereof remain in full compliance with a water
conservation program, including, but not limited to, a drought contingency plan, in accordance with
the requirements of the TNRCC. Such plan (and any amendments thereto) shall be submitted to the
appropriate authority as required by state law for review and approval. In the event that the TNRCC
adopts new requirements, CTW shall adopt an amended plan and submit the same to the appropriate
authority for review and approval.
11.02 CTW agrees that in the event that CTW furnishes or sells water or water services to a
third party that in turn will furnish water to the ultimate consumer, the requirements of this Contract
relative to water conservation shall be met through contractual agreements between CTW and the
third party, providing for the implementation and continued compliance with a water conservation
• program consistent with the requirements of the TNRCC.
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ARTICLE XII
REMEDIES UPON DEFAULT
12.01 In the event of any default by CTW in the performance of any of CTW's obligations
hereunder which shall continue for a period of thirty (30) days or more, BAWA shall give written
notice to CTW specifying the matter with respect to which CTW is in default and requesting that the
same be remedied with promptness and dispatch. In the event CTW, within forty-five (45) days after
the mailing of such notice by BAWA, has failed to remedy the matter in default, BAWA may
suspend further delivery of treated water to CTW hereunder; and in the event such default on the part
of CTW continues for an-additional thirty (30) days, BAWA may, by an additional written notice to
CTW, cancel and terminate this contract, whereupon all rights of CTW and all obligations ofBAWA
hereunder shall terminate and be at an end. The exercise of such rights shall be in addition to any
other remedies available to BAWA under the laws of the State of Texas.
12.02 During any monthly period in which BAWA is unable to deliver to CTW, CTW's
daily requirements of water, whether as a result of temporary curtailments resulting from temporary
shortages as provided in Section 10.01 hereof or of force majeure as provided in Article XM hereof,
CTW shall be obligated to pay BAWA only for the quantities of treated water actually delivered to
CTW under this contract during such month. During any such period, CTW shall be free to obtain
treated water from other sources.
12.03 The failure of either party to insist in anyone or more instance upon performance of
any of the terms, covenants or conditions of this Contract, shall not be construed as a waiver or
relinquishment of the future performance of any such term, covenant, or condition by the other party
hereto, but the obligation of such other party with respect to future performance shall continue in full
force and effect.
ARTICLE XIII
FORCE MAJEURE
13.01 In the event either party is rendered unable, wholly or in part, by force majeure to
carry out any of its obligations under this Contract other than the payment of money, or in the event
CTW is rendered unable, wholly or in part, by force majeure to operate CTW's facilities, it is agreed
that on such party's giving notice and full particulars of such force majeure in writing or by telefax or
telegraph to the other party as soon as possible after the occurrence of the cause relied upon, then the
obligations of the party given such notice, to the extent it is affected by force majeure and to the
extent that due diligence is being used to resume performance at the earliest practicable time, shall be
suspended during the continuance of any inability so caused as to the extent provided but for no
longer period. Such cause shall as far as possible be remedied with all reasonable dispatch.
13.02 The term "force majeure" as used herein, shall include, but not be limited to, acts of
God, strikes, lockouts, or other industrial disturbances, acts of the public enemy, war, blockades,
insurrections, riots, epidemics, landslides, lighting, earthquakes, fires, storms, floods, washouts,
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droughts, tornadoes, hurricanes, arrests and restraints of government and people, explosions,
breakage or damage to machinery, equipment, pipelines or canals, and any other inabilities of either
party whether similar to those enumerated or otherwise and not within the control of the party
claiming such inability which by the exercise of due diligence and care such party could not have
avoided.
13.03 It is understood and agreed that the settlement of strikes or lockouts shall be entirely
within the discretion of the party having the difficulty and the above requirement that any force
majeure be remedied with all reasonable dispatch shall not require the settlement of strikes or
lockouts by acceding to demands of the opposing party when such course is inadvisable in the
discretion of the party having the difficulty.
13.04 CTW shall not be guaranteed any specific quantity or pressure of water whenever
BAWA's treated water supply is limited or when BAWA's equipment may become inoperative due
to unforeseen breakdown or scheduled maintenance and repairs, and BAWA is in no case to be held
to any liability for failure to furnish any specific amount or pressure of water. BAWA agrees that it
will attempt to make any necessary repairs or adjustments to its equipment within reasonable times
mutually agreeable to both parties. It is further agreed that BAWA may, without liability of default,
interrupt its services hereunder to make necessary alterations to or repairs in its facilities, but only if
such interruption cannot otherwise reasonably be avoided. BAWA shall schedule interruptions in
advance after consultation with CTW.
ARTICLE XIV
ADDRESS AND NOTICES
14.01 Until CTW is otherwise notified in writing by BAWA, the address of BAWA is and
shall remain as follows:
Baytown Area Water Authority
Attn: General Manager
2401 Market Street
Baytown, Texas 77520
Until BAWA is otherwise notified in writing by CTW, the address of CTW is and shall
remain as follows:
Country Terrace Water Co, Inc.
Attn: President
P.O. Box 24433
Houston, Texas 77229 -4433
14.02 All written notices, statements, and payments required or permitted to be given under
. this Contract from one party to the other shall be deemed given by telefax or the deposit in a United
States Postal Service mailbox or receptacle of certified or registered mail, with proper postage
12
affixed thereto, addressed to the respective other party at the address set forth above or at such other
address as the parties respectively shall designate by written notice.
ARTICLE XV
MISCELLANEOUS PROVISIONS
15.01 This contract shall bind and benefit the respective parties and their legal successors,
but shall not otherwise be assignable, in whole or in part, by either party without first obtaining the
written consent of the other; provided, however, that CTW shall have the right, without any consent
of BAWA to pledge or otherwise assign CTW's rights hereunder to the extent required by any
mortgage, deed of trust or other similar agreement to which CTW may be, or hereafter become a
party; provided that, CTW's successor or assignee, as the case may be, is a responsible person or
entity and shall (by operation of law or otherwise) expressly assume CTW's obligations hereunder;
and provided, further, however, that no successor or assignee of CTW shall be entitled to receive
water or sell water to a third party under this Contract unless and until the City of Houston and the
San Jacinto River Authority give their written consent to such assignment.
15.02 This Contract shall be for the sole and exclusive benefit of BAWA and CTW and
shall not be construed to confer any rights upon any third party, except as expressly provided in
Article X. BAWA shall never be subject to any liability in damages to any customer of CTW for any
failure to perform under this Contract.
15.03 This Contract shall be subject to all present and future valid laws, orders, rules and
regulations of the United States of America and the State of Texas and of any regulatory body having
j urisdiction.
15.04 This instrument contains all the agreements made between the parties concerning the
sale and delivery of water by BAWA to CTW at the Point of Delivery set out in this Contract.
15.05 The construction, interpretation and performance of this Contract shall be governed
by the laws of the State of Texas, and venue shall lie in Harris County, Texas.
15.06 All parties agree that should any provision of this Contract be determined to be
invalid or unenforceable, such determination shall not affect any other term of this Contract, which
shall continue in full force and effect. The parties agree that this Agreement shall not be construed in
favor of or against any party on the basis that the party did or did not author this Agreement.
15.07 Each party has the full power and authority to enter into and- perform this Contract,
and the person signing this Contract on behalf of each party has been properly authorized and
empowered to enter into this Contract. The persons executing this Contract hereby represent that
they have authorization to sign on behalf of their respective entities.
15.08 The parties acknowledge that they have read, understand and intend to be bound by
the terms and conditions of this Contract.
13
•
n
IN WITNESS WHEREOF, the parties hereto have executed this contract as of the,�day of
September, 2001, in multiple copies each of which shall be deemed to be an original, but all of which
shall constitute but one and the same contract.
BAYTOWN AREA WATER AUTHORITY
1
n
ROBERT L. GILLETTE, President
ATTEST:
PETER R. BUENZ, Sec ary
COUNTRY TERRACE WATER CO., INC.
4S ature
j ePr`9 ljow
Printed Name
Title
STATE OF TEXAS
COUNTY OF HARRIS
Before me, _0&=, M EK"L4- the undersigned notary public, on this day
personally appeared E,2 Kv in his/her capacity as oW nleiZ of Country
Terrace Water Co., Inc.
(4 one)
known to me
proved to me on the oath of
proved to me through his current
description of identification card or
or
"-7S9Z ► X -bL
other document issued by the federal
goverment or any state government that contains the photograph and signature of
the acknowledging person)
14
•
to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me that
he executed that instrument for the purposes and consideration therein expressed.
t
Given under my hand and seal of office thi day of September, 2001.
— pa"��
Notary Public in and for the State of Texas
PATTI MERRELL
* * Notary Public, State of Tp"S
Canmissim Expires Nov. 27, 2004
cAdh274\13AWA \country Terrace WateAWaterSuppKontract082001
15
My commission expires: // %a 7lo y
APPROVED TO CONFORMING TO
REQUIREMENTS OF CONTRACT
NO. 34739, SECTIONS 9.2 AND ":
ANTHONY-HALL, City A
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