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HomeMy WebLinkAbout2004-11-03 Packet CITY OF UKIAH CITY COUNCIL AGENDA Regular Meeting CIVIC CENTER COUNCIL CHAMBERS 300 Seminary Avenue Ukiah, CA 95482 November 3, 2004 6:30 p.m. 1. ROLL CALL 2. PLEDGE OF ALLEGIANCE 3. INTRODUCTIONS/PROCLAMATION/PRESENTATION a. Proclamation: National Hospice Month 4. APPROVAL OF MINUTES a. Budget Hearings of June 29-30, 2004 b. Regular Meeting of the City Council of October 6, 2004 5, RIGHT TO APPEAL DECISION Persons who are dissatisfied with a decision of the City Council may have the right to a review of that decision by a court. The City has adopted Section 1094.6 of the California Code of Civil Procedure, which generally limits to ninety days (90) the time within which the decision of the City Boards and Agencies may be judicially challenged. 6. CONSENT CALENDAR The following items listed are considered routine and will be enacted by a single motion and roll call vote by the City Council. Items may be removed from the Consent Calendar upon request of a Councilmember or a citizen in which event the item will be considered at the completion of all other items on the agenda. The motion by the City Council on the Consent Calendar will approve and make findings in accordance with Administrative Staff and/or Planning Commission recommendations a. Rejection of Claim for Damages Received from Seizer Realty and Referral to Joint Powers Authority, Redwood Empire Municipal Insurance Fund b. Notification to Council Regarding Purchase of 4,500 ft. of 4/0 AWG Aluminum, 15 KV, EPR Insulated, Jacketed, Concentric Neutral, Single Conductor Cable to the Okonite Company in the Amount of $6,692.66 c. Award of Bid to Discovery Office Systems for a Five Year Lease of Two Copiers Machines in the Amount of $625.02 Per Month d. Authorization For City Manager To Execute A Professional Services Agreement In An Amount Not To Exceed $35,000 To Mead & Hunt For The Update Of The Ukiah Regional Airport's Airport Layout Plan 1 AUDIENCE COMMENTS ON NON-AGENDA ITEMS The City Council welcomes input from the audience. If there is a matter of business on the agenda that you are interested in, you may address the Council when this matter is considered. If you wish to speak on a matter that is not on this agenda, you may do so at this time. In order for everyone to be heard, please limit your comments to three (3) minutes per person and not more than ten (10) minutes per subject. The Brown Act regulations do not allow action to be taken on audience comments in which the subject is not listed on the agenda. 8. PUBLIC HEARINGS (6:45 P.M.) a. Adoption of Resolution Adjusting User Fees at the Ukiah Regional Airport b. Adoption of Resolution Approving the Proposed Mitigated Negative Declaration for the ~astewater Treatment Plant Improvement project 1 UNFINISHED BUSINESS a. Public Information Regarding Street Sweeping in Residential Areas b. Restrictions on Appointment of City Council Member to Fill Vacancy 10. NEW BUSINESS a. Regulation of Grown Marijuana and Marijuana Dispensaries Under Compassionate Use Act b. Adoption Of Resolution Finding Negative Declaration Certified On March 3, 2004 Adequate For Final Design Of Water Treatment Plant Upgrade Project And Approving The Final Design c. Adoption Of Resolution Approving Single Member Services Agreement And Master Confirmation Agreement, Authorizing City Manager To Sign Same And Authorizing City Manager/Public Utilities Director To Approve Various Transactions To Purchase Energy As Needed d. Adoption Of Resolutions Approving Applications For State Of California Department Of Parks And Recreation Grants For Various Park Improvement Projects 11. COUNCIL REPORTS 12. CITY MANAGER/CITY CLERK REPORTS 13. CLOSED SESSION a. G.C. ~54957.6-Conference with Labor Negotiator Employee Negotiations: Directors & City Manager Labor Negotiator: Candace Horsley 14. ADJOURNMENT TO SPECIAL MEETING OF NOVEMBER 107 2004 COMMENCING AT 5:00 P.M. The City of Ukiah complies with ADA requirements and will attempt to reasonably accommodate individuals with disabilities upon request. PROCLAMATION dignity of every person, regardless of age, health, or social status, and that evenJ stage q~ human life deserves to be treated with the utmost respect and care. 29~F~' NOW, THEREFORE, I, Eric Larson, Mayor of the City of Ukiah, on behalf of rr~ fellow City Councitmembers Phil Baldwin, Roy Smith, Paul Andersen, and Marl Rodin, c~lp~ hereby proclaim November 2004 as ~ NATIONAL HOSPICE MONTH and encourage citizens to increase their awareness of the importance and availability hospice services and to observe this month with a~p,prot~te activities Dated:November3,2004 ~~.~ ~ ~"~c Larson, Magor and programs. MINUTES OF THE UKIAH CITY COUNCIL Regular Adjourned Meeting of Tuesday, June 29, 2004 Through Wednesday, June 30, 2004 The Ukiah City Council met at a Regular Adjourned Meeting on June 29, 2004, the notice for which had been legally noticed and posted, at 8'05 a.m. in the Civic Center Council Chambers, 300 Seminary Avenue, Ukiah, California. Roll was taken and the following Councilmembers were present: Rodin, Andersen., Smith, Baldwin, and Mayor Larson. Staff present: Customer Service Supervi,, Services Director DeKnoblough, Police Captain Dewey, Elton, Wastewater Treatment Plant Supervisor Gall Greco, Personnel Officer Harris, Risk Mana¢ Supervisor Horger, City Manager Horsley, Ukiah C~ Water Treatment Plant Operator Johnson, Latipow, Accounting Manager McCann, Assi~, Assistant Riley, Community Services Super Ferri, Deputy Public Works Director Steele, Planning Director Stump, Police Whitaker, Police Chief Williams, Fire Battalior Ziemianek, and Deputy City Clerk Others ibald, Community Director/City Clerk !ities/Sports Coordinator Harris, Purchasing Manager Jenney, Ibeil, Fire Chief jrt Mana¢ ~ey; Executive ~acomo, :ector Smith- Public 'ks Engineer Public Works~'' Supervisor ates, Public Utilities Director :: Consultant Kennedy. 2. PLEDGE OF ALLEGIANCE Budget Officer/Risk Mana er 3. RIGHT TO Mayor Larson appeal 4. AUDIENCE CO No one cai Publ ~.m. ITEMS 5. P A. City Manag budget and increased HEARING BUDGET OF PROi AND ADOPTION OF FISCAL YEAR ~ED BUDGET BY CITY MANAGER ,sented the City of Ukiah's Fiscal Year 2004-2005 draft h the initial General Fund deficit was $1.2 million, some 'or reductions in non-public safety expenditures were made to decrease the deficit to $635,000. In an attempt to stabilize the State budget and local government revenues, Governor Schwarzenegger has reached an agreement with cities and counties for a two-year reduction in City funding to support State budget deficit recovery. The City Council has approved the inclusion of a public safety sales tax measure on the November 2004 ballot for a half-cent sales tax increase to exclusively fund police and fire services. She discussed the General Fund Summary and a review of all of the funds for each department. In summary, she stated that this year's budget contains the basic service elements the City is still able to provide with reduced staffing and expenditures exceeding revenues. The pending sales tax measure in November, if passed, will protect the public safety functions and ensure Regular Adjourned Meeting June 29-30, 2004 Page 1 of 16 continued essential services for the community through a stable funding source. She concluded by discussing important events that will take place in the next four months that will determine the fiscal stability of the City. B. REVIEW OF GENERAL BUDGET FIGURES i. Summary by Activity or Function and Fund Summary ii. Schedule of Transfers iii. Debt Summary iv. Authorized Personnel v. General Fund and Ex Finance Director Elton advised that this budget is considered due to the State experiencing financial away from local government. The available rever budget proposal recommends a reduction of rese He explained that reserves are available to sE deficits. He went on to discuss the above n~ Fund and Reserves in more detail. more City through ~ctions of the Bud¢ others the Council has to take money that usual. The f a million dollars. three years of the General A general discussion followed with regard to required revenue, Vehicle License~ , and would require a four-fifth's vote of t Jncil. It VLF had increased significantly nue departmental expenditures have decr~ City's reserves, bonds and ~se of money from fund 115 that that the total amount of has increased, while C. Review of Gener il a. Fi Accoul No specific Fin~ ;d that only one employee staffs this department. Fin~ :ctor Elton the usiness Ii( the Downtowi the business conveyed to the accomplish the g District ,lained that the fund accounts for the monies received from ise fee imposed upon themselves by the businesses within Parking Improvement District. The funds received through less a charge for the City's collection of the fees, are Main Street Program for expenditure administration to this kind. d. Purchasin_cl Purchasing Agent Horger discussed the accomplishments and objectives for the Purchasing Department. e. Billing and Collection Finance Director Elton discussed the Billing and Collection Division's staff and their duties, and noted that some staff members are cross trained to improve efficiency in the division. Regular Adjourned Meeting June 29-30, 2004 Page 2 of 16 ii. PLANNING a. Community Plannin_q b. Buildin~ Inspection Planning Director Stump discussed personnel and services in the Community Planning and Building Inspection divisions. He noted that the Code Compliance Coordinator position is frozen for next year. Tape lb He continued to discuss alternations to the budget and reco the stipend paid to the Planning Commissioners (as r, Commission), a minimal amount for consultant assist~ and conferences. He noted the Director's salary i: Housing. the elimination of ;nded by the Planning no allocation for travel rom Redevelopment There was discussion .concerning the ;e of hiring a Compliance Coordinator and whether that position funded f~ me or part ti the next fiscal year. Since the structure for a change in January 2005, concern was expressed .mmissioners receive training. Discussion ensued related to howe, s time is for the work they do for ~~:~'~ d lSCU the Redevelopment Agency. The'~~o ' concerning initiating a more · .. ~'...=,,~ .~..-,.:~.~. , aggressive penalty schedule for cod~?.~'~i~,=:~ iii. PUBLIC WORKS a. En ineerin, Public Works Di objectives for that the final in 5. S · . sugg of the P n~ the City res ~n inquiry County ~st expenditure,, attempt a collal ~neering ion ineer discussed the accomplishments and ;ion of ublic Works Department. She explained Circulation Study should be completed amount allocated to Conference and ,'es. She on to discuss Capital Expenditures and invest in the GIS system, noting its affects on the Public Utility, and Planning Departments. She also map and other information with the County. In Andersen with regard to partnering with the the GIS system, she explained that one of the major updated aerial photo, and she felt this is a good time to b. Street Maintenai Public Works Director/City Engineer Steele discussed personnel in this department and the City Manager's recommendation that two vacant positions be frozen. There is also a decrease in expenses for training. She noted that the major item this year is the purchase of a new street sweeper. Discussion followed with regard to educating the public regarding the street sweeping schedule so that cars could be moved off the street to accommodate the sweeper. Concern was expressed with regard to the amount of dust generated by a street sweeper and the degree of debris that enters the storm drains. It was the consensus Regular Adjourned Meeting June 29-30, 2004 Page 3 of 16 of Council that the street sweeping schedule should be prepared to educate the public. There was discussion concerning the issuance of fines to those leaving their vehicles on the street on scheduled sweeping days. It was also suggested that flyers identifying the street sweeping schedule could be sent with the utility bills and that the schedule be posted on the City's web page. c. Corporation Yard Public Works Director/City Engineer Steele advised that two significant items in this budget concern Taxes & Fees and Contractual Services th; ~cludes $90,000 for a portion of continued hydrogeology investigation and site the remainder of funding for the project is budgeted in Fund 699. Discussion followed with regard to the remediat concerns of the plume advancing toward other drilling and pumping of ground water to can be further quantified. It was noted th~ some refunding of the remediation costs. and ground water for contamination. There of the project and that an additional $90,000 matter of how much money will be.~ :he Corp Yard and Th discussion of far the Ioing so that it .... City can apply thrche State for :ontinuel tesl the wells cussion concer~ing the cost in Fund 699. It's not a , but rath ming issue. d. Signalization Fund Deputy Director of Public Works design of the Orchard covered by a from funds and others, project been funding. Services for the The project funding will be pori[~tion Improvement Plan (STIP) fed on two occasions due to the lack of e. De de,, for bids in ti Works Sea r discussed Contractual Services for the Orchard Avenue Bridge. Staff estimates they will Tape 2a There County and overriding ing a timeframe for reaching an agreement with Mendocino the final EIR by the City Council, as well as the issue of mitigations. f. Gas Tax and Projects Deputy Director of Public Works Seanor advised that Contractual Services in Account No. 300-9632 regarding the design and construction of curb, gutter, and sidewalk improvements, was re-budgeted from 2003/2004. He also discussed Contractual Services in Account No. 301-9805 regarding the design and construction of railroad crossings rehabilitation, and discussed STIP funding. He went on to discuss the SB 325 Fund and speed zone studies. He discussed the Gas Tax Funds with regard to the Surface Transportation Project and the traffic signal detector loop replacement and pavement projects. Regular Adjourned Meeting June 29-30, 2004 Page 4 of 16 Deputy Director of Public Works Seanor advised that the City was awarded a grant in the amount of $22,000 from the Office of Traffic Safety and the money is tied to federal funding. The grant will cover the cost of four electronic speed display signs, of which, two are solar powered. Staff will work with the Traffic Engineering Committee to finalize locations where they will be placed. He also discussed the Committee's review of crosswalk issues and options available to rectify problem areas. Staff discussed the STIP project which has been funded to construct the realignment of Babcock Lane with Oak Manor Drive and Gobbi constructed, the temporary footbridge across Gibson longer be required. Staff has had initial discussions regarding the purchase of this bridge to serve as a re bridge which connects the Oak Manor School gro Gibson Cree. STIP funding was discussed as result of development. Improvements mad intersection of Talmage Road and Airport into the Park, as well as funding for the concerning the Orr Creek retaining wall, impn the Waugh Lane bridge improvemeq:~ (20 foot this project is this location, will no :hool District personnel !or the existing wooden ;destrian path along impact mitigations as a he Airport ani widening the iulevard to allow forturn lanes ;ct were project on Smith Street and projects were discussed. g. Municipal Gara_cle Deputy Director of Public Works Garage with regard to salaries and possible. h. Solid Waste Public Works to review the period of Landfill towa~ if doesn't p~ to the work al Site Steele )lained Service Fund for the is operating as lean as le City is waiting for the Regional Board idfill. In the meantime, there will be a She discussed the remoteness of the fith people ~1 onto the property. Staff is working Discussion followed relative to the funding formula and "s work plan, the City is unsure if it will have funding )wn. Recessed !3 a.m. iv. PUBLIC UTILr a. Electric Public Utilities Director Ziemianek advised that Contractual Services is for the service contract for the annual circuit breaker and re-closer maintenance, transformer disposal, 4 KV substation change (Phase 1) engineering service, and re-conductoring Perkins Street/Orchard Avenue to underground. There was a brief discussion with regard to how the underground and overhead accounts are set up. Tape 2b He further discussed "Distribution-Meters" in the Electric Enterprise Fund and discussed electronic metering. There are significant changes to the "Purchased Power" accounts Regular Adjourned Meeting June 29-30, 2004 Page 5 of 16 under Operations & Maintenance and he noted options available to the City. He advised that there is an increase in Contractual Services and explained the increase of $75,000 for the replacement of a diesel truck. He discussed "Departmental Expense" and noted an increase to Conference and Training so as to take a more vital role in Northern California Power Authority (NCPA) and Western Area Power Authority (WAPA). He discussed Contractual Services that is allocated for a rate and power study. He also discussed "Interdepartmental Expense" with regard to accounts Rental of Land & Buildings, and Fuels & Lubricants. With regard to "Lake Mendocino Hydro", he discussed increases to Contractual Services due to the A~'...~,~.. Corps of Engineers' requests, various repairs, and also lubricants needed for t~i~ting pumps. He went on to discuss the City's relationship with the Army Corp~,,ii~hgineers of restarting the plant and stressed the importance of working with th~ii' ~, understand where the City is at in the process. There was a brief discus~i~?C~'?°nc~'~ reducing the City's debt and also refinancing hydro bonds ..... b. Street Liqhtin_cl .... Public Utilities Director Ziemianek d :he Stre~ Fund:ii~:noted that the expenditures remain fairly flat. Councilmember Rodin d' noted that many City residents are regarding street lighting and ~tness of street lights. Consultant Kennedy explained the' making adjustments a to building. Staff is revi lense from the public by the light away from a c. Electric ~nefit Finance Director programs budget~ el amount of Benefits Fund and the City's existing utility bills. He explained that the received. Service Prog nd noted th~ ret 'e has been discount m throu¢ interest in buildings. Archibald discussed the Energy Conservation install double pane windows receive significant increase in the senior discount program and the monthly C.A.R.E.S. She noted that there has not been much program, other than by the City for the Civic Center Finance Director noted that some of the new programs, such as the window replacement program, have expanded. Staff will continue to monitor the programs and will advise Council when the programs are nearing their ceiling. d. Traffic Signals No specific comments. e. Water Public Utilities Director Ziemianek discussed salary and employee benefits and operation and maintenance expenses in the Water Fund. He discussed Conference Regular Adjourned Meeting June 29-30, 2004 Page 6 of 16 and Training expenses related to securing a water permit extension/revision, the City's share of the Inland Water and Power Commission's (IWPC) environmental services, the City's share of the Russian River Watershed Association, and environmental services (CEQA) for water right permit extension and revisions. Consultant Kennedy discussed evaluating the proposals for the CEQA document and also the contribution to the Russian River Watershed Association. City Manager Horsley advised that the City expects particip~ water agency and is waiting for the bids to open before the the budget. Consultant Kennedy discussed the change in occurs. He also discussed the City's new wells water mains were not implemented and since Due to the lack of engineering personnel, fiscal year. by at least one other amount is included in ...... :"%?~iii~, ~ se":~"~,~.changes if diversion consider~~erflows. Several me material c~!~'''~¢~i~ ave .... increased. ,rojects were not coq d in the last Public Utilities Director Ziemianek disc Storage Fund and noted that ~n accoun He advised that funds for the re 1990 He went on to discuss Capital Pro Funi Water Treatment Plan cost in chemicals an~ Jami is in the Water Production and are in need of being replaced. are included in account 800. has been an increased !ing their cost. Consultant plant for pumping e service for e! parts needed for the water treatment electrical and instrumentation, six chemical feed pumps. Fina~ Meter Reading Expenses as related to Salaries. Ta Consu Kennedy Projects ~nd noted year. He we .to Contractual Services in the Water Utility Capital in account #800 are carried over from the previous fiscal Phase I of the reservoirs project. v. COMMUNITY a. General Gover~ Buildings City Manager Horsley explained that City Hall is now opening at 7:30 a.m. and that both citizens and staff appreciate the new hours. b. Parks Community Development Supervisor Sangiacomo advised that the Park Lead Worker position is frozen in the Parks Division and he discussed the animal control position. He explained that the Community Development Department has completed development of Orchard and Observatory Parks and he discussed the restoration of some of the historical buildings on site. Regular Adjourned Meeting June 29-30, 2004 Page 7 of 16 City Manager Horsley explained that Staff is looking at an alternative fuel vehicle for the animal control position since the City has had great success with the meter reading vehicles and would like to have more electric vehicles in its fleet. Community Services Director DeKnoblough advised that Nisson would like to continue supplying the City with electric vehicles. In fact, the City will be receiving two more electric vehicles soon. c. Park Development Fund Community Development Supervisor Sangiacomo d!~d the Park Development Fund and the replacement of playground equipment in~~~rks. The City expects reimbursement by the 2000 State Park Bond Fund:~.?~'e im~ments are slated to be conducted this year. He advised that two park~ers receiv~~ining from REMIF with regard to the selection of playground e~'~ent and are I~g at equipment made from recycled materials ..... ~::¢~ City Manager Horsley explained that the cut its traini~=~:~'' budget by utilizing Redwood Empire Municipal Insurance d. Recreation~ Administration Community Development Su and objectives for the Recr. eation the increased cost of ~d W o~ offset it by the significant up! ie broclhas ol has been seekim ~mo ~sed the accomplishments get was hardest hit with Staff has been able to sponso p of fees. He noted that a · red with the recreation classes and Staff brochures to offset those costs. It was the brochure looks great. Com with devei ;nt. able to explained does have discussed expa Inn~ Staff ay camp · Sangiacomo advised that Staff has been ey have begun computer modules for facility on-line registration for email users and will be to those inquiring about recreation programs. He based on socio-economic profiles. However, the camp of the community participating in its program. He for those five years of age and under. e. :reation, :s and rams f. Aquatics Community Development Supervisor Sangiacomo advised that Staff has been proactive in maintaining lifeguards for pool participants and is also proactive with training lifeguards. There is a new water safety program and all of the employees will be updated this week. The little pool was filled and with temperatures increasing, it should be open soon after being shut down for painting. He explained that there are problems with the plumbing under the decking of the pool and noted that Staff will be looking for grant funding to make necessary repairs. He briefly discussed Anton Stadium. Regular Adjourned Meeting June 29-30, 2004 Page 8 of 16 Community Development Director DeKnoblough discussed the situation at the pool needing a new liner or paint every two years. There is the chance that some of the Park Bond Funds may be used for the new liner. He went on to discuss a fund raising campaign to construct an aquatic center within the next three to five years. He explained that full restoration of the pools may not be able to occur without matching funds. He discussed Riverside Park and explained that the State has been selecting projects that can be put into use right away. He also discussed park development fees. Sun House Museum .~ii~i~ ..... gMuseum- Director Smith-Ferri advised that, with the=~,~ "ption of PERS and ' ' ' ' "~'®~®~'"'?' ' r Workman s Compensation, there are no increases ~r~~~nd~tures for the G ace and Sun House for the next fiscal y~~iScussed the possibility Hudson Museum of cutting the Museum Curator position, which .::,~:~":"discd~ during pre-budget discussions. $o as not to jeopardize the Sun Hou~ ild has increased the amount of funding for next year. ::~'::~iiiiiii!iii!~i~%.:::,~ City Manager Horsley explained that it on the '~~f the Sun House Guild to keep the museum operating . The Cit~::'~ppreciates their efforts. Museum Director Smith-Ferri Museum yearly, both locals and vi~ California Gold television rogram d Museum was included College and an program. The Guild the brochures lendars are currently he contr Ihey number of visitors at the of She explained that the a visit in Ukiah and the programs with Mendocino Inn for coming to Ukiah for that a significant amount of money towards a significant impact on visitors. They than an admission fee. City M; for a er. Council ~ber Public Fund coul ~ed the sign~ between charging a fee and asking 'ector Smith-Ferri to find out what the law is concerning scussed utility costs at the Museum and suggested that the for the Museum to install a photovoltaic system. Community Di installing photovol Director DeKnoblough explained that the City will be all of the City's buildings. Recessed: 12:13 Reconvened: 12:45 Tape 3b h. Municipal Golf Course Community Development Director DeKnoblough discussed the Golf Fund balance and explained that it is difficult to predict the Golf Course revenue and participation. Currently, there is disparity in how the rates are paid. Staff will report back to Council regarding restructuring the fee schedule and possibly increasing the greens fees. He Regular Adjourned Meeting June 29-30, 2004 Page 9 of 16 went on to discuss the impact of the fees on revenue for the Golf Course. He briefly discussed concessions at the Golf Pro Shop, noting that the contract with the Golf Pro will be expiring soon and staff will be looking at options. i. Parking District Customer Service Supervisor Archibald explained that one significant objective for the Parking District is to work with W-Trans for completion of the downtown parking study. City Manager Horsley explained that Staff did not know th( thus no allocation was listed in the budget. However, $31 extent of the study, is available. Councilmember Andersen was of the opinion the City will discontinue the use of parking meter revenue in violations or penalties than with pa~ j. Ukiah Valley Conference Center Community Services Director DeKnoblou¢ held at the Conference Center. Staff is also I: and there is a lot of revenue 'he revenue than expenditures. He replacement and he discussed the (HVAC) and carpet replacement. Conference Center positions. He went ~.the Plaza. at $75 coordin; study, he hopes ght there is more romoting com~'~nity events weddings and private parties Center still operates with less has been allocated for roof , and Air Conditioning of personnel at the of restructuring the g events at the Alex Thomas Community Servii are not o an, advised that the cameras in the Plaza Fina~ Fire in money ou session. is in a money is ~mplete pro trust ed the money from the sale of the North State Street ng resolution of how the money should be used. A lease payments for the skate park. He noted that accounting of the trust fund, there is a need to move the He will provide Council with a list at tomorrow's budget Councilmember that it should be use( stated that he does not want to see money absorbed and specific purposes by putting it into the 699 account. Mayor Larson was of the opinion that nothing should be done with the money until after the November election due to a possible change in the composition of the City Council. vi. PUBLIC SAFETY a. Police Police Chief Williams provided a summary of the Police Department's $3.4 million budget. He noted the budget is very thin and in order to maintain this budget, the City may have to dip into reserve funds, which will carry the Police Department so far without Regular Adjourned Meeting June 29-30, 2004 Page 10 of 16 the passage of the public safety tax measure scheduled for the November election. He noted that the majority of increases to the budget are salaries. Staff recently received authorization to fill one frozen police officer position and the Department will be one person short in the front office due to the Administrative Secretary position being frozen. There is a change to account #250 for psychological services due to the increase cost of exams. He explained that Staff would like to keep a minimal amount of money in the account for a new burglar alarm. He went on to explain how the Department has been involved promote and recruit potential police officer applicants. bilingual persons very interested in applying with the Dc the extended academy. The Department is in the all segments of the community to become skills. City Manager Horsley noted that job preferred. ......... ~utreach program to are four Hispanic two of whom are in ,eloping a program for ide them with some ~cements. indicate '~~h~-- speaking b. Major Crimes Task Force No specific comments. Tape 4a Councilmember Baldwin inquired and its affect on the Po rtment.' rowing in the City limits Police Chief Wil explair~ that about people marijua~ their b the smell, public the Department received many calls and they expressed concern with by individuals stealing from gardens. Counci s of the o only ~nes. that it is a zoning issue and that it should Poi Willi~ the City's the Major Crimes Task Force could provide Dep~rtment on this matter. c. Police Police Chief are active. The program which may dets ised that the Department has five cadets but only one or two ient is attempting to focus attention on the cadet and volunteer used as a supplement to Police Department staffing. d. Supplemental and Local Law Enforcement Police Chief Williams explained that it appears that about $100,000 in grants will be funded again this year. There are three part-time positions paid out of this grant. The grant that was used to pay the Police transcriptionist will not be renewed this year. e. Dispatch Police Chief Williams advised that Dispatch provides services to the Police and Fire Departments as well as other departments of the City, such as Public Works. There is Regular Adjourned Meeting June 29-30, 2004 Page 11 of 16 not much of a change from last year's budget. Upon questioning by Councilmember Baldwin, Chief Williams briefly discussed the process for calling for helicopter assistance and coordinating it with the Highway Patrol. He commended REACH C^LSTAR and noted that when they heard about Police Officer ¥oung's incident at Wal-Mart, they turned around and came back to assist. f. Fire g. Fire Volunteers/Explorers Fire Chief Latipow advised that during the past fiscal developed a complete inventory and replacement schedul They also established an OSHA compliant Respiratory a medical exam component. He noted that reg November passes or fails, the Fire Department's is in the process of reviewing all of the services to explore a two-tiered fee structure for resid have occurred because of the increase in PI line items due to tracking methods. Staff anticipating filling another vacancy before the .... :: ..... the Fire Department all capital equipment. Program inclusive of or not the sales tax in be revisited. Staff trtment would like changes ,ts within the two ~ies and is He discussed fire season and we~ the driest Spring in many years. Department will be charging for recovery program for false alarms Department has not (FEMA) grant and need to it WOL budgeted. the .,,d that the City has experienced ue to lack of abatement, the He iscussed initiating a cost He explained that the Emergency Mangement Act for th~'"~grant; the Department would · e valley. The defilibrator may need to be vii. MU! Al and older flight Contractual implementation' mailing, and consultant will in acc ~n has are in nee, Iding, an( lichey advi~ that this budget is similar to past budgets ~1 on income from fuel sales. He discussed Grounds Maintenance and noted that the Airport this budget. He explained that some of the rehabilitation, as well as the administrative building and the heating system needs to be updated soon. He discussed amount of $719,901 for consultant services for Improvement grant, such as engineering, bid documents, The Airport has received a grant from the FAA and the engineering of the grant. It was noted that there is a large amount of infrastructure repairs needed. Upon an inquiry by Council, he discussed security at the Airport and explained that there is not 24-hour security available at the Airport but there is security fencing and a locked gate for the fuel trucks. viii. ELECTED AND APPOINTED OFFICIALS a. City Council City Manager Horsley discussed the City Council's budget and noted that the cost of utilities, as shown in account #210, have decreased with the closure of City Hall every other Friday. Supplies have also been reduced. Regular Adjourned Meeting June 29-30, 2004 Page 12 of 16 Risk Manager/Budget Officer Harris advised that the rental of the building has also decreased and this will be the last year of that debt for paying off the Civic Center building. City Manager Horsley explained that the City is looking at a new system for maintenance and Staff will be going out to bid for a new phone system at no additional cost. .~: Councilmember Baldwin was of the opinion that there the Mayor than Councilmembers because the Mayor has a different stipend for responsibility. Mayor Larson was of the opinion that rather than want to allot an expense account to each Council Council may b. City Clerk/Elections Deputy City Clerk Ulvila explained that strides in scanning documents into the Las makes research much easier and uicker for reduced this fiscal year. She ~at $15,1 November 2004 election. Clerk great I imaging systi 'n and this ;rence and Training has been ts been allocated towards the c. City Treasurer No specific comments. d. Attorne, City Manager $8,000. She discus the Cil rate. "s budget has been decreased by IX. nager Hors Trair her and concerr City Mai Redevelo Agency Assistant po~ ADMINIST ~N hat there is a reduction in account Conference & ]er positions. There was some discussion er's salary and how it is shared with her work for the housing. She noted that a portion of the Executive in this account. Councilmember budget is devoted to expressed concern that the Redevelopment Agency purposes when it could go to housing. b. Personnel/Risk Management No specific comments. c. Administrative Support No specific comments. d. Community Outreach/Public Information Regular Adjourned Meeting June 29-30, 2004 Page 13 of 16 City Manager Horsley discussed youth scholarships, having the City Council meetings televised, equipment for televising the Council meetings, and the City's newsletter. Councilmember Andersen advised that he would like to see a CD burner on the computer used for televising meetings. City Manager Horsley explained that another piece of equipment is required to make televising meetings operational. Staff has been working with the County offices and will purchase equipment with a major equipment purchase by t~,~County to save some e. Misc. General Government Ris~-'~'~-n~Harris explained th~ ~::~'~cc~~overs miscellaneous general government expenses, such as the Leagu~!~,.~ California Cities membership dues. X. OTHER FUNDS .... a. Equipment Reserve b. Civic Center Bond Interest and Redem c. Special Revenue d. Federal G e. Community Development Blocl f. Economic Develo Block g. :ommi Risk Manager/B, of computers as the Civic Center project. the Nat~ Fun~ :ment Block durin< !rris ex $21,591 is budgeted for replacement year. 250 is for future maintenance costs for as the Riverside Park Implementation will receive funding assistance from He continued with a review of the Grants Shelter Grant (FESG), and reviewed the Community with regard to Contractual Services. h. E~ Risk Mar Fixed Assets Harris explained the replacement of equipment and i. S Pro serve Risk Manager/Bud Officer Harris explained the Special Projects Reserve Fund and described the projects. He discussed grant matching funds. There was discussion regarding the use of funds from the sale of the North State Street property (former Fire Station). Discussion also focused on the Smith Street repairs, the Skate Park property lease, Grant Matching Funds: Jobs Housing Balance Grant- Economic Development Coordinator, and Public Works Projects. j. Worker's Compensation Insurance Regular Adjourned Meeting June 29-30, 2004 Page 14 of 16 Risk Manager/Budget Officer Harris noted that the fund balance has been decreasing as Worker's Compensation costs have increased. He continued with a brief discussion of Worker's Compensation claims submitted by employees. Finance Director Elton explained that the City is still reducing the fund balance significantly and noted there will be a $200,000 decrease in this next fiscal year. k. Liability Insurance Risk Manager/Budget Officer Harris explained that the Liab the City includes premiums, deductibles, and ;urance activities of 3:05 p.m.: It was the consensus of the City Cou budget on June 30, 2004 at 3:00 p.m .......... discussion of the June 307 2004 RECONVENED: 3:24 p.m. Present: Councilmembers Rodin, Andersen, , and Mayor Larson. City Manager Horsley noted that the selection of commission membe~ It was the consensus the Resolution. )uncil )uncil a Resolution with regard to :!'Planning Commission" from D. )N YEAR City Man; City ~ssion. CITY OF UKIAH FISCAL es to the budget as discussed by the enda items any ~le franchise accounl e racks, an Other top discussi services, chi enforcement po', uest to investigate the lawsuit for PEG channels and :ussion of the 699 account and different capital )n in July concerning the undergrounding of utilities. included fines for violations, appropriate fees for City ;nditures and revenues and whether to fund a code Planning Department. It was the consensus of Council to fund a Code Enforcement Officer position in the Community Planning Department and provide the Planning Commission with a stipend amounting to $6,000 per year. City Manager Horsley advised that in talks between Planning Director Stump and the Planning Commission, it was noted that some Commissioners are willing to forgo their stipend. It was also the consensus of Council to approve Training and Conference for the Planning Department in the amount of $4,000 per year, Contractual Services for the hydroelectric plant in the amount of $25,000, and Contractual Services for capital projects in the amount of $25,000, with miscellaneous projects in the Special Projects Department totaling $617,113. Regular Adjourned Meeting June 29-30, 2004 Page 15 of 16 M/S Smith/Andersen adopting Resolution 2004-31, approving the 2004-2005 fiscal year budget for the City of Ukiah as modified to include changes recommended by the City Council, carried by the following roll call vote: AYES: Councilmember Rodin, Andersen, Smith, and Mayor Larson. NOES: Baldwin. ABSTAIN: None. ABSENT: None. There being no further business, the Ukiah City Council meeting was adjourned at 5:05 p.m. Marie Ulvila, Deputy City Clerk Regular Adjourned Meeting June 29-30, 2004 Page 16 of 16 MINUTES OF THE UKIAH CITY COUNCIL REGULAR MEETING WEDNESDAY, OCTOBER 6, 2004 The Ukiah City Council met at a Regular Meeting on October 6, 2004, the notice for which had been legally noticed and posted, at 6:30 p.m. in the Civic Center Council Chambers, 300 Seminary Avenue, Ukiah, California. Roll was taken and the following Councilmembers were present: Rodin, Andersen, Smith, Baldwin, and Mayor Larson. Staff present: Public Utilities Project Manager Burck, Services Director DeKnoblough, Finance Director Elton, Wastewater Tn City Manager Horsley, Water Treatment Plant Man; Lohse, Accounting Manager McCann, City Attorne, Director Seanor, Public Works Director/City En!' Public Utilities Director Ziemianek, and Deputy C Supervisor Gall, 'son, Planning Associate Deputy Public Works ing Director Stump, UIvila. 2. PLEDGE OF ALLEGIANCE Community Services Director DeKn~ ;d the P of Alleg 3. PRESENTATIONS 3a. Presentation from Mendo~ Phil Dow, Executive Director of provided Council with a 2005 u Plan (RTP). A summary of issues an on include: 1)Interag issues, 3) Private s, ~ent, Designation of s Level school bus trans :IOn as a about $5 million to~ if Caltrans to of tran~ of Go' I of Governments (MCOG) Regional Transportation this update will focus 2)Tribal government ~f finan~ ly unconstrained projects, 5) highways, and 6) Discussion regarding explained that MCOG agreed to fund ect once funds became available and nding. 3. PI frol C ission Dan H Chairm support, an City Council current project" Council and Paths~ Open Space~ and Creeks of the POSC, expressed appreciation to staff for their of the POSC's responsibilities as designated by the meetings and workshops have included field trips, ~ittee's focus for April 2005. He requested the City help with their projects. Bill Randolph discussed the POSC recommended improvements for the Brush Street Triangle as it relates to the Open Space Element of the General Plan. POSC has discussed separating the Committee into teams with regard to the members items of interest. His particular interest is with stream habitat restorations and would like to use the University of California (UC) extension programs in Ukiah and Hopland to develop ways in which habitat and development can coexist. Howie Hawkes outlined the POSC Commission's Western Hills Conservation and Development Recommendations, as contained in the Staff Report. He went on to Regular City Council Meeting October 6, 2004 Page 1 of 8 discuss obtaining public access to City-owned parcels and the fish hatchery for hiking and educational purposes. Jamie Connerton discussed providing open space around paths along creeks and that the POSC would be working on developing a trail from Pomolita School, near Orr Creek on Bush Street, and extending it to the east near the Oak Street bridge to create a better urban creek environment. Tape lb Fred Koeppel discussed creeks, streams and restoration the Committee's goal is to restore the Gibson Creek area Ukiah. POSC is also interested in the area near the rail working with the Skate Park Committee to establis. the creek. The POSC is researching funding opti this proj, and explained that through the center of on Perkins Street and and pathway along Discussion followed with regard to a barri; Leslie Street and with stream restorati~ California Department of Farm Land Con,, Proposition 44 for preservation of agricultural out the benefits of having a r the continue to work on that project. ibson Creek on th side of ,uncilme Rodin a. that the _~ million avail through ~uncilmember Smith pointed rse and suggested the POSC 3. PRESENTATIONS 3c. Presentation from Concernim Bob Wagner, re management Russian River and valley's the & Bon o water rig iivil 'neere ner& Bonsignore, a water resource to Council on hydrology of the studies are needed to understand the presentation concerning the issues that the Ukiah valley. 4. OF 4a. of Portie Me~ M/S Smil lin and carried from the Se 17 2004 City Council the portions of the Minutes from the September 1, 2004, nsent. 4. APPROVAL 4b. Re_clular Meetim 5, 2004 Councilmember Rodin noted a correction to page 3, last paragraph, second sentence should read, "He and the NCPA hydro engineering staff will begin consulting with NOAA Fisheries." M/S Smith/Andersen approving the Regular Meeting Minutes of September 15, 2004, as corrected and carried by unanimous consent. 4. APPROVAL OF MINUTES 4c. Joint Meeting of the City Council & Planning Commission of September 29, Regular City Council Meeting October 6, 2004 Page 2 of 8 2004 M/S Rodin/Smith approving the Joint Meeting Minutes of the City Council and Planning Commission for September 29, 2004, as presented, and carried by unanimous consent, with Councilmember Andersen abstaining. 5. RIGHT TO APPEAL Mayor Larson read the appeal process. 6. CONSENT CALENDAR Councilmember Andersen requested item "6c" be and scheduled for discussion at the next council m, regarding his concerns. Consent Calendar will confer with Staff M/S Smith/Andersen approving items "a" Calendar as follows: a. Received Notification of Purchase of from JBI Water & Wastewater Equ~ b. Received Notification to Council R~ Aluminum, 15 KV, EPR Insulated Single C~ "d" 'T' of the Consent Marlow Feed Pump $5,829.04; of 4,500 ft. #2 AWG Jacketed Concentric Neutral, Underground Cable to Americ .... Group in of $8,735.51; ~. ~V~l~l ~ v l,~l i I Vl~v ~ll iv VlV~l Il l~ ~l l~ , I VV I I Il I II I~ ~ I ~I IVey ~VV~IVl IV ~/;t~;~ +~e o;~, ~, Uk;ah +~ ~t~.+~+ a.~.;.+~ ~nc ;n a~ a~,,~ ~Ot +~ i i i i iii , ~ii Vl$~ Vl i i i ~v i I v~$vv~i i il ~Vl lVlVIi i i i i i i ii i iV~l i~ I ~v ~.~,.~,~' (Gontinuod to 10/20/04) d. Authorized AIIowam of W Manager to e. Authorized thi Card Lock Servi f. Authori: C~ g. Rec~ No. 96 Ukiah. Claims to Notification :-00110 B to to Become a Member Netwod (WARN) and Directed City Iwood Oil o. 4 to the Service Agreement for Fuel 4 to the Service Agreement for Fuel ~any; ~n of Surplus Used Equipment; from Michael Center and Christopher Scott Redwood Empire Municipal Insurance Fund; Council Regarding Execution of Exhibit C of Contract Western Area Power Administration and the City of Motion carried 'llowing roll call vote: AYES: Councilmembers Rodin, Andersen, Smith, Baldwin, and ayor Larson. NOES' None. ABSTAIN: None. 7. AUDIENCE COMMENTS ON NON-AGENDA ITEMS No one came forward to address Council. 8. PUBLIC HEARING (6:45 P.M.) 8a. Continuance of Major Subdivision Map Application No. 03-57 Planning Director Stump advised that the Planning Department, with the consent of the applicants for this project, requests that the City Council continue this item to October 20, 2004. This continuance is requested to allow the full passage of the 30-day Regular City Council Meeting October 6, 2004 Page 3 of 8 period required for the adoption of Ordinance No. 1058, which was approved by the Council on September 15th. Public Hearing Opened: 8:12 p.m. No comments received. Public hearing Closed: 8:12 M/S Andersen/Smith to continue the Public Hearing regarding Major Subdivision Map Application #03-57 to October 20, 2004, carried by the folk roll call vote: AYES: Council members Rodin, Andersen, Smith, Baldwin, and NOES: None. ABSTAIN: None. Recessed at 8:15 pm Reconvened at 8: pm 9. UNFINISHED BUSINESS 9a. Discussion and Direction to St~ SuDDly Contract City Attorney Rapport explained that the M Control and Water Conservatit September 17, 2004, and has nc must be signed by anyone wanting The letter accompanying the final con' to submit a signed foot as the fee for th the Gary Weath~ rigl in the Staff Re le also di pro bring these corn City does much Control Water County Russian River Flood (District) proposed, and on a stan~ Supply Contract which strict's water rights permit. until November 4, 2004, established $25 per acret City had the contract reviewed by ~d he discussed the concerns, as outlined created by the contract and efforts to ns the contract, whatever water the and the City would be allocated that Dis~ followed watei le, the City'~ when ,'s water expressed ;erns with Supervisors been expresse, reporting practices to the State concerning its water from the District, and allowing for dry years is Iow. The Mendocino County Water Agency has also standard contract and the Mendocino County Board of the District outlining those concerns. Concern has also Fetzer, and other users. The District's public hearing process regardincj was questioned. It was Staff's opinion that the District has not made a se ous effort to work through the contract language with its water users. Tape 2b Discussion continued regarding the District's view that the City should use the District's water allotment first, then its own water source. Other issues, such as consumptive use, protecting the rights of Ukiah's citizens, and having the District bill the City for the amount of water it consumes. The issue of lack of conservation methods in the valley was noted. Regular City Council Meeting October 6, 2004 Page 4 of 8 It was the consensus of Council that Staff should compile firm historical data on its water use and continue to negotiate contract changes with the Dist. Hal Wagenet, Chairman of the Mendocino County Board of Supervisors, referred to the Board's letter to the District, as contained in the Staff Report, and discussed the Board's concern with possible Brown Act violations when the District met without taking public comment. Lee Howard discussed the City not requiring Conflict of consultants and he encouraged Council to set a policy to financial interests with the City. statements from them to disclose their Tape 3a Discussion continued with regard to the pumpin, of C Council requested Staff find out the history discuss conservation with the District, conta~ some changes in the contract, contact clients, and see if other agencies are inte Members of the Council also expressed concer the District. 3ity's water ui r interested parties r & Bon: ore concert regardin! In summary, the District, if they want their other matter. ;sible Brown Act violations by 9. UNFINISHED BUSINESS 9b. Discussion of Selection of R~ and Bim Community Servi~ trash receptacles in Staff Agency funds. examples of bike racks and )ort to be paid for from Redevelopment Members racks Ana Araiz~ g new trash receptacles and bike ic Crane, and Douglas Crane. 10. 10a. Consulta background requests to discuss various [W BU~ of Fifl to the nnedy d and Determination of Findings with strial Park Ca Improvement Fee Account ssed his Staff Report to Council and provided historical reported that no interested parties had submitted written rice as required by the Mitigation Fee Act. He went on to gineering reports that were prepared for this project. Tape 3b Consultant Kennedy explained the four Findings staff is recommending the City Council make in accordance with the Mitigation Fee, as contained in the Staff Report. He continued with a discussion of the mitigations for the Talmage Road/Airport Park Boulevard improvements. The exceptions to the fees, and fee projections as noted in Finding #4, were explained to Council. Regular City Council Meeting October 6, 2004 Page 5 of 8 M/S Baldwin/Smith to receive the Fifth Fiscal Year Report as required by the Mitigation Fee Act and making the recommended findings presented in Staff's Agenda Summary Report A brief discussion followed related to the cost of widening Talmage Road and the state not assisting the City with project costs. It was noted by Staff that the City plans to apply for CDBG and other types of grant funding. Motion carried by the following roll call vote: AYES: lcil members Rodin, Andersen, Smith, Baldwin, and Mayor Larson. NOES: ~. ABSTAIN: None. ABSENT: None. 10. NEW BUSINESS 10b. of Member Services the City's Northern California Power Investigate Details to Restart the Director of Public Utilities Ziemianek Army Corp of Engineers, Federal Energy R agencies indicate the facility can be started procedures and mechanical up! le recomm the Member Services Agreement and requested the City Manager b, Ukiah. He explained the Councilme NCPA and it unanimou,, usi .000 From Reserve to endocino H, that site ~s and with the ission and other changes to plant operational of $200,000 through ~rnia Power Agency (NCPA), it on behalf of the City of Service Agreement to M/S Smith/Rodi from the City's investigate details Manager membe ABS' M~ Cai ~ia Smith, Ba ,ne. s Agreement authorizing use of $200,000 (NCPA) Operating Reserve to Hydro Facility and authorize the City following roll call vote: AYES: Council f~n, and Mayor Larson. NOES: None. 10. 10c. Co~ City Manag~ be vacating hi determine the BUSlNES~ · and ~sible Action a Vacancy on the City that Councilmember Andersen announced that he will of October 31, 2004 and the City Council must now for filling the vacant Council seat created by this change in position. She dis~ the two options available for filling a vacant Council seat within 30 days from the commencement of the vacancy. She explained that the Council must either fill the vacancy by appointment or take action to participate in an election by November 30, 2004. Discussion ensued relative to the options available to the Council as well as the estimated cost to hold a Special Election. Suggestions included allowing Councilmembers and citizens to be eligible to apply for the vacancy and not limiting the pool of applicants to just those on the November ballot. Regular City Council Meeting October 6, 2004 Page 6 of 8 Members of the audience that spoke to the issue included' Jim Mulheren, John McCowen, Eric Crane, and Mark Ashiku. City Attorney Rapport stated the vacancy needs to be filled by appointment no later than November 30th (30 days from the date of the vacancy- October 31st). Councilmember Andersen stated he was elected by a certain group of people in the City and he would like the current Council to select his replacement. Tape 4a It was the consensus of the Council to solicit a general public for appointment to the vacancy with the candidates and the November 10th. 11. COUNCIL REPORTS Councilmember Rodin reported attending a Commerce and it formally endorsed M~ Mulheren announced at the meeting that MCA were to fold there is a possibility the Ch~ of the Gre; ah Chamber of N in the Novemb Jim A has resic~ that if over its duti James Mulheren advised that the MCA ha= extended to Nov 21,2004. Councilmember Rodin also re and there was an interesting the Russian River with is a severe decline lunch at the Dem( headq~ for an Economi~ Point Arena were bree¢ strea ers for mmissior a Ru also N. River Watershed meeting working on a project in the habitat and noted there )rted attending a brown bag Today she went to Point Arena and community issues related to Col most its funds. Comm~ rted he the NCPA annual conference and the ~ge of a resolution to allow the City of Ukiah to use he attended the 90th birthday of the Greater Ukiah Count Baldwi advised that the Army Corps of Engineers stated, in response to claim that the issue of raising the dame was fruitless, that it would nc project unless it thought the feasibility study could conclude that raising the )uld be successful. He requested a future agenda item to consider having Ra ngineering conduct some studies regarding the amount of water that may be garnered from Akerstrom Creek and Bush Creek in Potter Valley. Mayor Larson reported that MCOG and LAFCO meetings were held on Monday. attended the Greater Ukiah Chamber of Commerce's 90th anniversary. He 12. CITY MANGER/CITY CLERK REPORTS City Manager Horsley reported that staff discussed holding a joint meeting of the City Council with the Ukiah Valley Sanitation District (District) and they suggested October 20, 2004, from 4:00 to 6:00 p.m. Their regular meeting begins at 2:30 p.m. on that day. Regular City Council Meeting October 6, 2004 Page 7 of 8 Councilmember Baldwin discussed the needed votes in order to begin the financing process. He explained that Supervisor Delbar wanted to invite engineers from the Sonoma County Water Agency to inform the District how to obtain more connections before the new plant goes on line; however, the District saw no need for it. Deputy City Clerk advised that the City is soliciting applications for the City Clerk position. Councilmember Baldwin noted that both Planning Bob Wallen are resigning from the Planning Commission er Jennifer Puser and 2OO4. City Manager Horsley advised that the Plannin~ three members for two months until the members in January 2005. prefer to have appo Commission Councilmember Baldwin disagreed with rel Adjourned to Closed Session at 11:44 p.m. 13. CLOSED SESSION a. CONFERENCE WITH LE Significant exposure to litk 54956.9(b) ( No action taken. IPATED LITIGATION Code Section 14..ADJOURNN There being no furt meeting was adjourned at 12:42 p.m. Mari~ Regular City Council Meeting October 6, 2004 Page 8 of 8 ITEM NO. DATE: NOVEMBER 3, 2004 AGENDA SUMMARY REPORT SUBJECT: REJECTION Of CLAIM FOr DAMAGES RECEIVED FROM SELZER REALTY AND REFERRAL TO JOINT POWERS AUTHORITY, REDWOOD EMPIRE MUNICIPAL INSURANCE FUND The claim from Seizer Realty was received by the City of Ukiah on September 20, 2004 and alleges damages due to electricity fluctuations at 139 Cresta between May and July 2004. Pursuant to City policy, it is recommended the City Council reject the claim as stated and refer it to the Redwood Empire Municipal Insurance Fund (REMIF). RECOMMENDED ACTION' Reject Claim For Damages Received From Seizer Realty And Refer It To The Joint Powers Authority, Redwood Empire Municipal Insurance Fund. ALTERNATIVE COUNCIL POLICY OPTIONS: Alternative action not advised by the City's Risk Manager. Citizen Advised: Requested by: Prepared by: Coordinated with: Attachments: Yes Claimant Michael F. Harris, Risk Manager/Budget Officer Candace Horsley, City Manager 1. Claim of Seizer Realty, pages 1-8. APPROVED:~ ~~x'~ Candace Horsley, City~nager mfh:asrcc04 1103CLAIM /~'~r~[: [':': .... Oity OlerWg Offi City of Ukiah 8EP 2 semina THE iT' Ukiah, CA 954~ C~,~F UKIAH CI~ CLcr~,, ~ DEPARTMENT MONEY OR AGAINST OF UKIAH RESERVE FOR FILING STAMP' U C.J ~ -o 2004 CITYOF UKIAH CITf CLERK'S DEPARTMENT A claim must be presented, as prescribed by the Government Code of the State of California, by the claimant or a person acting on his/her behalf and shall show the following: If additional space is needed to provide your information, please attach sheets, identifying the Paragraph(s) being answered. 1. Name and address of the Claimant: Affochrnenf II Name of Claimant: Address: Address to which the person presenting the claim desires notices to be sent: Name of Addressee:~~,O,,,' O', f' ;~Of ~1 ~,,(,.~. ~..~-¢,..¢ Telephone:~..,~-0~r~J t.~,~,~ - O~"'L I Address' . The date. place and other circumstances of the occurrence or transaction which gave rise to the claim asserted. Date of Occurrence: //~_~_ ~C:)O~,,i¢ --- :Tr.- ~ '"O~--' Time of Occurrence: ~%~ ~,' ~e Location: ~ C~~~ ~ ~ ~ ~~,.~ ~~ Circumstances giving risetothis claim: ~~~~~ ~ ~~~. L~~ ~ ~, ~ ~ ~ - _ _ - O- ' ) .... ~ ~ ~ -' ~ .... ( General description of the indebtedness, obligation, injury, damage or loss incurred so far as it may be known at the time of the presentation of the claim. The name or names of the public employee or employees causing the injury, damage, or loss, if known. ---l' Page I o! 3 . If amount claimed totals less than $10,000: The amount claimed, if it totals less than ten thousand dollars ($10,000) as of the date of presentation of the claim, including the estimated amount of any prospective injury, damage, or loss, insofar as it may be known at the time of the presentation of the claim, together with the basis of computation of the amount claimed. Amount Claimed and basis forco,~ut~L~. ~ ~ ~:.~. ~:L-'~O.~,...tt~ ~'~, 0J,..~ -~.-- If amount claimed exceeds $10,000: If the amount claimed exceeds ten thousand dollars ($10,000), no dollar amount shall be included in the claim. However, it shall indicate whether the claim would be a limited civil case. A limited civil case is one where the recovery sought, exclusive of attorney fees, interest and court costs does not exceed $25,000. An unlimited civil case is one in which the recovery sought is more than $25,000. (SeeCCPC::5, 86.) [___j Limited Civil Case ~-] Unlimited Civil Case You are required to provide the information requested above in order to comply with Government Code] §91o. Claimant(s) Social Security Number(s): (optional) 8 Claimant(s) Date(s) of Birth: 10 Name, address and telephone number of any witnesses to the occurrence or transaction which gave rise to the claim asserted~ If the claim involves medical treatment for a claimed injury, please provide the name, address and telephone number of any doctors or hospitals providing treatment: If apphcable, please attach any medical bills or reports or similar documents supporhng your claim tf tile cta~m relates to an automobile accident Cla~nant(s)Auto Ins Co Telephone Address Insurance Po}~cy No.' Insurance Broker/Agent Address Telephone Cla,mant'sVeh L~c No Vehicle Make/Year Cla~mant's Drivers Lic. No.: Expiration: If apphcable, please attach any repair bills, estimates or similar documents supporhng your claim. Page 2 of 3 READ CAREFULLY For all accident claims, place on the following diagram the name of streets, including North, East, South, and West; indicate place of accident by "X" and by showing house numbers or distances to street corners. If City of Ukiah vehicle was involved, designate by letter "A" location of City of Ukiah vehicle when you first saw it, and by "B" location of yourself or your vehicle when you first saw City of Ukiah vehicle; location of City of Ukiah vehicle at time of accident by "A-l" and location of yourself or your vehicle at the time of the accident by "B-l" and the point of impact by "X." NOTE: If diagrams below do not fit the_ situation, attach hereto a proper diagram signed by claimant. CURB SIDEWALK PARKWAY SIDEWALK z' CURB Warning' Presentation of a false claim is a felony (Penal Code §72). Pursuant to California Civil Prodecures §1038, the City/Agency may seek to recover all costs of defense in the event an action is filed whictfi is later determined not to have been brought in good faith and with reasonable cause. Page 3 of 3 Ukiah Electric 676 S. Orchard Avenue Ukiah, CA 95482 707-462-1660 License: 713241 Invoice Invoic_.e~: UE 1646 Date: 06/14/2004 Billed To: Project: Seizer Realty 350 E. Gobbi Street Ukiah CA 95482 Due Date: 06/24/2004 Terms: 10DY Order8 Amount / 139 Crestaj / Lights get very bright then dim. Traced circuit to dryer/washer. Checked wiring. Isolated to subpanel behind main panel. Found lights dim at 13 amp. Saw it on both legs. Called City. Replaced 30 amp two pole to pool. 30 amp was the wrong breaker to electric dryer plug. Replaced 30 amp tandem with a full size 30 amp. Replaced 20 amp tandem with two full sized 20 amp s.p Labor: 6 hours Materials lll CEIYEB JUN 1 ,5 004 270.00 46.80 A service charge of 18. O0 % per annum wfti be charged on ali amounts overdue on regular statement dates. Thank you for your prompt payment! Non-Taxable Amount: Taxable Amount: Sales Tax: 316.80 0.00 0.00 Amount Due 316.80 SOlD TO 4055 SANTA ROSA AVE.. SANTA ROSA, CA 95407 . 707/588-76(X) 1360 BROADWAY'. SONOMA, CA 95476 · 707/938-0~67 1255 AIRPORT PARK BLVD. · UKIAH, CA 95482 · 707/4~8-8020 SHIP TO SELZER REALTY 350 E GOBBI SELZER REALTY 350 E GOBBI UKIAH, CA 95482 I IIIIII! I!11 IIIII IIIII IIIII IIIII IIIII IIiil II!11 IIII IIII * I 3 0 9 " 1 1 6 8 * 139 CRESTA 10th SHIPPED /' 1 UKIAH, CA 95482 ORDER # ! ORDER DATE I 30972225 06/07/04 DESCRiPHON Shipment ~: 1 77037 10 "CONTEMPO 10000797 EA /~ QT$O BATHFAN QUIET 6692 MEDALLION WH SLSMN j INVOICE # I INVOICE DATE YYR i 30931188 06/07/04 PRICE 8.150 2.850 AMOUNT 8.15. 2.'85. 95.080 85.08, I~ F1L/.EO eYi CHK'D 8Y : DRIVER ;SHIP VIA * IN~'OICE IMPORTAN'I~-~r:~i-~Ilii~I~.~I~.!~iI~MS & CONDITIONS OF SALE. Purchaser agrees to pay all attorneys fees, court costs and interest in the event any charges are incurrecl by seller in collecting the amounts represented by th~V~i~.e, w~,th %~itho~ut litigation or suit... ' .... ~ ..-,." UI' ~. James Ut ]rich RECEIVED THE ABOVE ,, GOOD CONDITION: X i MERCHANDISE =OTHER ~ - 7.259% FREIGHT TOTAL 9E,. 08 ,: ~._~.0_ 103.05 ,/ Repair Numbert 35645 1 Problem: PICK UP DRYER AND WASHER FROM PROPERTY, PUT DRYER IN Tenant Code:I 139 1 STORAGE, TAKE WASHER TO DUMP. I D~t~ Worked II Worker II Work Performed II Billing Hours II Amo..t 2/1'3/2004 JOHN PICKED UP WASHER AND DRYER ON 0.50 16,00 BACK DECK. 2/13/2004 MIKE PICKED UP WASHER AND DRYER 0.50 16.00 Repair Total: 32.00 Repair Numbert 35769 ! Problem' MOVE OUT MAKE READY. Tenant Code:l" 141 I Date Worked II Worker II Work Performed II Billing Hours I1,:,, Amount 4/5/2004 DAN REKEYED UNIT. 1.00 32.00 4/14/2004 DAN REKEYED BOTH DEADBOLTS TO ENTRY 1.20 38.40 LOCKS, DRILLED AND INSTALLED ONE ON BACK DOOR, STILL NEED TO INSTALL ONE ON FRONT DOOR. 4/14/2004 MIKE SWEPT, MOPPED FLOORS. CLEAN, WIPE , 1.80 45.00 DOWN KITCHEN APPLIANCES, VACUUM, CHANGE LIGHT BULB, CLEAN LIGHT FIXTURE, FAN IN BATHROOM. 4/15/2004 DAN 'INSTALLED DEADBOLT ON FRONT DOOR. 0.80 25.60 Repair Total: 141.00 Repair Number;[ 35948 I Problem: ELECTRICAL ISSUES, FAN, POWER SPIKES, CEILING FAN. Tenant Code:i 139 I I Date Worked II Worker I!, Work Performed Ii' _Billing Hours II Amount 6/4/2004 DAN PULLED FAN MOTOR AND TAKE TO 1.00 32.00 MARTINS ELECTRIC. 6/7/2004 JAMES TRACED PROBLEM WITH CEILING FAN TO 6.00 192.00 TRIPPED CFI OUTLET IN BACKYARD. REPLACED FAN WITH NEW UNIT, REPLACED FLOURESCENT TUBES. TRIED TO TRACK DOWN VOLTAGE SPIKE WHEN OPERATING CERTAIN APPLIANCES-COULD NOT LOCATE. 7/26/2004 -DAN REPLACED VENT FAN MOTOR DAMAGED 0.60 19.20 ~BY POWER SURGES Repair Total: 243.20 Repair Grand Total: 755.40 Page 2 of 2 SOLD TO 4055 SANTA ROSA AVE. · SANTA ROSA, CA 95407 · 707/584-7811 1360 BROADWAY · SONOMA, CA 95476 * 707/939-8811 1255 AIRPORT PARK'BLVD.. UKIAH, CA 95482 · 707/468-7811 SHIP TO SELZER REALTY 350 E GOBBI SELZER REALTY 350 E GOBBI URIAH, CA 95482 I IIIIIII Iill IIIII IIIII Iltll IIIII II!11 IIIII III!1 IIII i111 * I ~' 0 9 8 9 4 2 ':' ~ACCOUNT # CUSTOMER P.O. # 'II::RMS 1902 i 139 CRESTA ORDERED SHIPPED Net 10th t U~M UKIAH, CA 95482 ORDER# 0329 DESCRIPTION EA QT90 BATHFAN QUIET 1736692 ORDER DATE 07/26/04 Shipment #: 1 SLSMNI INVOICE # I INVOICE DATE YYR i 3098942;-' PRICE 85.080 AMOUNT ~= 08~ "if we don't have it you don't need it" lu i v 26, FILLED BY~ CHK'D BY : DRIVER ' / Ii iMERCHANDISE --'9~]* 14: 41: 27 OT :"/YR " 0 ,, SHIP VIA !OTHER IMPORTANT: ~EE ~EV~SE SJD~ ~0~ Tc~MS & CONDITIONS OF SALE. Purchaser ~grees ~o pay all ~orn~s fees, cou~ costs ~nd m~er~s~ ~n ~he event any charges are ~ncurred Dy seller ~n collecting the amounts represented by th~s~w,~ o~Pou1,~,,ga,o~ o, ~u,~. i RECEIVED THE ABOVE IN GOOD CONDITION: ~ .. .1~ CTOTAL . 7. 250% AGENDA SUMMARY Item No 6b Date: November 3, 2004 REPORT SUBJECT: NOTIFICATION TO COUNCIL REGARDING PURCHASE OF 4,500 FT. OF 4/0 AWG ALUMINUM, 15KV, EPR INSULATED, JACKETED, CONCENTRIC NEUTRAL, SINGLE CONDUCTOR CABLE TO THE OKONITE COMPANY IN THE AMOUNT Of $6,592.66 In compliance with Section 1522 of the City of Ukiah Municipal Code, this report is being submitted to the City Council for the purpose of reporting the acquisition of material costing more than $5,000 but less than $10,000. A Request for Quotation (R.F.Q.) through the informal bid process was sent to seven suppliers for aluminum conductor wire. Four bids were received and opened by the Electric Department on October 5, 2004. The Okonite Company, Iow bidder, was issued a purchase order in the amount of $6,592.66 including tax and freight. The bid results were: The Okonite Company Perilli Cable & Systems, LLC Western State Electric American Wire Group $ 6,592.66 $11,483.16 $13,272.19 $15,347.48 This cable will be placed in warehouse stock for planned future projects and has been budgeted in the 2004/2005 Fiscal Year in Account Number 800.3646.690.000. Sufficient funds are available for this purchase. RECOMMENDED ACTION: Receive and file report regarding the award of bid to The Okonite Company for the sum of $6,592.66. ALTERNATIVE COUNCIL POLICY OPTIONS: N/A Citizen Advised: N/A Requested by: Stan Bartolomei, Electrical Supervisor Prepared by: Judy Jenney, Purchasing & Warehouse Assistant Coordinated with: Candace Horsley, City Manager Attachment: None APPROVED: ¢~~__~ ~~,,,_ Candace Horsley, City ~l~nager ITEM NO. 6¢ DATE: NOVEMBER 3 2004 AGENDA SUMMARY REPORT SUBJECT: AWARD OF BID TO DISCOVERY OFFICE SYSTEMS FOR A FIVE YEAR LEASE OF TWO COPIER MACHINES, IN THE AMOUNT OF $625.02 PER MONTH The Police and Fire Departments have recently completed a five year lease of two copier machines. At the end of this leasing period, the departments submitted a Request For Proposals for new copier machines to eight suppliers. Four vendors, IKON Office Solutions, Discovery Office Systems, Advance Xerographics, and The Systems Network, submitted proposals. The proposals ranged from a high bid of $1,815.56 per month to a Iow bid of $625.02 per month for the 60 month term of the lease. A portion of one bid did not meet specifications. Staff reviewed each of the proposals from the vendors and found that the Iow bidder, Discovery Office Systems, met all of the specifications in the proposal. This is a substantial savings over the previous lease which was $1,245.18 per month. Staff recommends that Discovery Office Systems be awarded a lease contract for a five year term for two office copier machines, using currently budgeted funds in accounts 100.2001.255.000 (Police), 100.2101.255.005 (Fire), 678.2040.255.000 (Dispatch), and 220.4601.255.000 (Parking). RECOMMENDED ACTION: Award Five Year Lease To Discovery Office Systems For Two Copier Machines In The Amount Of $625.02 Per Month. ALTERNATIVE COUNCIL POLICY OPTION: Reject bids and provide staff with alternative action. Citizen Advised: N/A Requested by: Ukiah Police Department Prepared by: Chris Dewey, Police Captain Coordinated with: Candace Horsley, City Manager and John Williams, Police Chief Attachments: None APPROVED: Candace Horsley, City~ /lanager ITEM NO. 6d DATE: November 3, 2004 AGENDA SUMMARY REPORT SUBJECT: AUTHORIZATION FOR CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT IN AN AMOUNT NOT TO EXCEED $35,000 TO MEAD & HUNT FOR THE UPDATE OF THE UKIAH REGIONAL AIRPORT'S AIRPORT LAYOUT PLAN The City of Ukiah received a grant from Federal Aviation Administration (FAA) in September 2002 in the amount of $715,500. These funds are to be used to replace portions of failed underground storm drain, build a freight operations area, install culverts and cover an open drainage ditch, pave the service road around the north end of the field, and add several sections of security fencing. In December of 2003, when design documents were submitted to the FAA for review, FAA advised staff that the City must update our Airport Layout Plan (ALP) as a condition of grant approval. Public Works Engineering staff updated the information included in the previous ALP submittal and forwarded it for review. FAA staff indicated that the review would take several months to process, however responded cooperatively to a request for that review to be expedited. The response came in the form of a seven-page detailed checklist of requirements in strict compliance with FAA Advisory Circular for preparing ALPs. The City's previously approved ALP does not include the level of detail outlined in the Circular. Due to budget and staff resource contstraints at the FAA, it has become a new policy to require that updates to ALPs be accompanied by the recently developed checklist certified by the preparer. Because of the technical nature of the information that the FAA now requires to be included in an ALP, the task is beyond the expertise of Airport or Engineering staff, and it is Continued on Page 2 RECOMMENDED ACTION: Authorize City Manager to execute a Professional Services Agreement in the amount not to exceed $35,000 to Mead & Hunt for the update of the Ukiah Regional Airport's Airport Layout Plan. ALTERNATIVE COUNCIL POLICY OPTION: Determine agreement is not appropriate and N/A Paul Richey, Airport Manager Paul Richey, Airport Manager and Diana Steele, Director of Public Works/City Engineer COORDINATED WITH: Candace Horsley, City Manager ATTACHMENTS: 1. Airport Budget Sheet 2. FAA grant letter 3. Mead & Hunt proposal Candace Horsley, City bPkanager provide direction to staff. CITIZEN ADVISED: REQUESTED BY: PREPARED BY: AUTHORIZATION FOR CITY MANAGER TO EXECUTE A PROFESSIONAL SERVICES AGREEMENT IN AN AMOUNT NOT TO EXCEED $35,000 TO MEAD & HUNT FOR THE UPDATE OF THE UKIAH REGIONAL AIRPORT'S AIRPORT LAYOUT PLAN November 3, 2004 Page 2 of 2 necessary to obtain outside assistance. It is important that the update to the ALP be completed as soon as possible, so that the grant-funded work may progress. Under the terms of this type of grant, funding authorization could be withdrawn at the end of four years from the time the grant offer was made if funds are not used by then. Staff contacted five airports in Northern California, and all have used the aviation engineering firm of Mead & Hunt of Santa Rosa California, to update their ALPs. This firm designed the City's existing ALP in 1996/1997, and has this data and other pertinent local data on file. Due to the time constraints, recommendations of other airports, our past experience with this firm, and data already in possession of Mead & Hunt, staff is recommending Council approval to engage this firm for updating our ALP on a time and materials basis for an amount not to exceed $35,000. Under the City's procurement requirements a professional services contract can be awarded without soliciting multiple bids, when it is feasible to do so. Moreover, the contract is awarded to the best qualified firm with price being only one factor to consider. Given the time constraints and Mead & Hunt's unique familiarity with the Ukiah Airport ALP and its experience providing ALPs for airports in the area, Staff believes this award is permitted by the Ukiah City Code. In a meeting held on September 29, 2004, FAA has agreed that this work is reimbursable at 90% of the cost of this update, and suggested that one of the two grants be amended to facilitate this reimbursement. Staff is working with FAA staff to process this amendment. Approximately $31,500 in reimbursement can be expected if the ALP update requires the entire $35,000 estimated. The Fiscal Year 2004/2005 Budget included $719,901 for contractual services related to the Airport Improvement Grant (Fund 315). Invoices for consultant and contractor work anticipated to be completed this year plus funding the ALP update will not exceed the budgeted amount. o~ 0'~ ~~o Attachment I--, z LIJ ./ U.S. Department of I ransportation Federal Aviation Administration Attachment # San Francisco Airports District Office 831 Mitten Road, Room 210 Burlingame, California 94010-1303 Septe~Joer '4, '"'" "" FEDERAL EXPRESS Ms. Candace Horsley City Manager City of Ukiah 300 Seminary Avenue Ukiah, California 95482 Dear Ms. Hors!ey: .Airport Ukiah Municipal, CA; A_iP Project No. 3-06-0268-06; Contract No. DTFA08-02-C_313~ ~ ~,-; Grant Offer Enclosed are the original and three copies of the approved Grant Offer for the above project. Acceptance of the Grant Offer will obligate the Sponsor to accomplish the described development. The United States commits itself to participate in the allowable cost of the project not to exceed the amount s~own on Page 2 of the Grant Offer. The Offer must be acce~te~ on or ~fore September 30, 2002, mS specified in Condition 6, P~e 2 of Basic ~ -~ '~ ~' ~ c~n=~a=r=~on= are that members of the Sponsor's governing body know the full content of the Grant Offer and that the method of acceptance conforms to local law. The official of the Sponsor authorized to accept the enclosed Grant Offer shall accept same by signing said offer and inserting the date in the space provided under Part II - Acceptance. The Sponsor's attorney shall certify that the acceptance complies with all applicable laws and constitutes a legal and binding obligation of the Sponsor by executing the "CERTIFICATE OF SPONSOR'S ATTORNEY". The date of said certificate shall be the 'same as, o~ later than the ~te of execution. When the document is ful!v executed,.., certified, attested and appropriate seals are impressed, ~lea~e returner he stamp, ed ORIGINAL and two co~ies of tho executed Grant Agreennent to this office. Manager, Airports District Office Enclosures Scope of Services for Mead & Hunt Attachment Airport Layout Plan Update for Ukiah Municipal Airport October 10, 2004 Services Mead & Hunt will revise the Airport Layout Plan of the Ukiah Municipal Airport for the City of Ukiah to bring it into conformance with Federal Aviation Administration (FAA) guidance contained in Advisory Circular 150/5300-13, Change 7 and the San Francisco Airports District Office Airport Layout Plan checklist dated September 14, 2004. Mead & Hunt will meet with City and FAA staff as necessary to accomplish the revision. Following FAA review, if additional changes are required Mead & Hunt will provide a second revised version of the Airport Layout Plan for resubmission. The Airport Layout Plan will be updated to show construction that has occurred since the last update. A limited planning effort will be undertaken to address: Projects in the Airport Capital Improvement Program The substandard Runway Object Free Area near the threshold for Runway 33 due to the bend in the alignment of the parallel taxiway. City Responsibilities The City will provide: > An AutoCAD drawing file of the current version of the Airport Layout Plan > Topographic contour data for the airport property Deliverables Mead & Hunt will provide the following materials as a part of this contract: > Three copies of an administrative draft of the Airport Layout plan > Sufficient copies of the revised draft Airport Layout Plan to meet FAA's submission requirements > A completed San Francisco Airports District Office Airport Layout Plan checklist > One copy of the final Airport Layout Plan on Mylar > An AutoCAD file of the final Airport Layout Plan C:\Documents and Settings\PRICHEY~Local Settings\Temporary Internet Fites\OLKAA\UKI ALP scope rev.doc 1 Mead & H Scope of Services Airport Layout Plan Update Ukiah Municipal Airport Schedule Mead & Hunt will provide a complete draft of the Airport Layout Plan within 90 days of receipt of the topographic contour data. Following receipt of City comments, Mead & Hunt will provide a revised version for submission to the FAA, along with a completed Airport Layout Plan checklist within 2l days. If necessary following FAA review, a second revised version will be produced within 30 days. Fee This project will be undertaken on a time-and-expense basis for a not-to-exceed fee of Thirty Five Thousand Dollars ($35,000.00). A budget for any additional services will be negotiated, if necessary. C \Documents and Settings\PRICHEY~Local Settings\Temporary Intemet Files\OLKAA~UKI ALP scope.rev doc 2 Mead & H . Mead & Hunt, General Terms and Conditions For Engineering, Mead & Hunt, Inc. will begin services upon written 5. authorization to proceed. Receipt of a signed contract (the "Contract") will be considered written authorization, which shall be incorporated herein by reference. If the terms or conditions of this agreement conflict with those in the Contract or any other agreement, this agreement shall control. For projects requiring phased services a written authorization of approval of the prior phase and notice to proceed on the subsequent phase must be received prior to commencement of services. Phases, 6. when applicable, shall be divided into study and report phase, preliminary design phase, final design phase, bidding or negotiating phase, and construction phase, as set forth in the Contract. Mead & Hunt, Inc. will bill the Owner monthly, according to the payment method set forth in the Contract, with net payment due in thirty (30) days. Past due balances shall be subject to an interest charge at a rate of 1-1/2% per month. In addition, Mead & Hunt, Inc. may, after giving seven (7) days' written notice, suspend service under any agreement until the Owner has paid in full all amounts due for services rendered and expenses incurred, including the interest charge on past due invoices. . The quoted fees and scope of services constitute the best estimate of the fees and tasks required to perform the services as defined. This agreement, upon execution by both parties hereto, may be amended only by written instrument signed by both parties. For those projects involving conceptual or process development service, activities often cannot be fully defined during initial planning. As the project progresses, facts uncovered may reveal a change in direction which may alter the scope. Mead & Hunt, Inc. will promptly inform the Owner in writing of such situations so that changes in this agreement may be made as required. In addition, if the Owner requests significant modifications or changes in the scope of the project, the time of performance of Mead & Hunt, Inc.'s services and rates of compensation shall be adjusted. The Owner shall be liable for all costs and damages incurred by Mead & Hunt, Inc. for delays caused in whole or in part by the Owner's interference with Mead & Hunt's ability to provide services, including, but not limited to, the Owner's failure to provide specified facilities or information, or if Mead & Hunt, Inc.'s services are extended by Owner's actions or inactions for more than ninety (90) days. The Owner agrees to indemnify and hold Mead & Hunt, Inc. harmless for any delays caused by the Owner. If delays are caused by unpredictable occurrences including, without limitation, terrorism, fires, floods, riots, strikes, unavailability of labor or materials, delays or defaults by suppliers of materials or services, process shutdowns, acts of God or the public enemy, or acts or regulations of any governmental agency, the costs for services and schedule commitments shall be subject to change. . Inc. Architectural, or Consulting Services Mead & Hunt, Inc. will maintain insurance coverage for: Worker's Compensation, General Liability, Automobile Liability, Aviation Liability, and Professional Liability. Mead & Hunt, Inc. will provide information as to specific limits upon written request. If the Owner requires coverages or limits in addition to those in effect as of the date of the agreement, premiums for additional insurance shall be paid by the Owner. The liability of Mead & Hunt, Inc. to the owner for any indemnity commitments or for any damages arising in any way out of performance of this agreement is limited to a period of twelve months from the date of the last bill from Mead & Hunt, Inc. to the OWNER, whether paid or not paid by the OWNER; such liability is limited to the amount of the fees paid by the OWNER to Mead & Hunt, Inc. for performance under this agreement. Mead & Hunt, Inc. and the Owner agree that the ultimate liability for mold or mildew regardless of its source, and for the actual, alleged, or threatened discharge, dispersal, release, or escape of pollutants, mycotoxins, spores, smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, buildings, the atmosphere, or body of water shall remain with Owner; and the responsibility and/or liability for any of the foregoing, and for the ownership and maintenance of any toxic, hazardous, or asbestos materials relating to the project, shall remain with the Owner. Mead & Hunt, Inc. and the Owner acknowledges that Mead & Hunt, Inc.'s, professional liability and general liability policies do not apply to claims arising out of the a foregoing. Therefore, the Owner agrees not to bring a claim against Mead & Hunt, Inc. relating to the uninsured liability referenced above. Furthermore, the Owner agrees to indemnify and hold harmless Mead & Hunt, Inc. for all claims against Mead & Hunt, Inc. arising out of or related in any way to the above stated liability and/or responsibility of the Owner whether or not such claims arise out of and/or have been caused in whole or in part by negligence on the part of Mead & Hunt, Inc. and in the event Mead & Hunt, Inc. shall be made a party to any suit or litigation on account of an injury or damage to person, life, or property arising out of or related in any way to the above stated liability and/or responsibility of the Owner, the Owner shall, at Owner's sole expense, defend such action on behalf of Mead & Hunt, Inc. including claims and causes of action at common law, arising under any statute, or arising out of any governmental demand or request, and if judgment shall be obtained or claim allowed in any proceedings against Mead & Hunt, Inc. the Owner shall pay and satisfy such judgment or claim in full. The Owner agrees to clarify and define project requirements and to provide such legal, accounting and insurance counseling services as may be required for the project. CA General Terms and Conclitions/lO-03 Page 1 of 2 Mead & Hunt, Inc. General Terms and Conditions For Engineering, Architectural, or Consulting Services . Termination of this agreement by the Owner or Mead & Hunt, Inc. shall be effective upon seven (7) days' written notice to the other party. The written notice shall include the reasons and details for termination. Mead & Hunt, Inc. will prepare a final invoice showing all charges incurred through the date of termination; payment is due as stated in paragraph 2. If the Owner breaches the Contract or any other agreements entered into between Mead & Hunt, Inc. and the Owner or if the Owner fails to carry out any of the duties contained in these terms and conditions, Mead & Hunt, Inc. may, upon seven (7) days' written notice, suspend services without further obligation or liability to the Owner unless, within such seven (7) day period, the Owner remedies such breach to the reasonable satisfaction of Mead & Hunt, Inc. 10. Use of any documents and/or services pertaining to this project by the Owner or extensions of this project or on any other project shall be at the Owner's sole risk. The Owner agrees to defend, indemnify, and hold harmless Mead & Hunt, Inc. from all claims, damages, liabilities, losses, and expenses including attorneys' fees and costs arising out of such use of the documents and/or services by the Owner or by others acting with the consent of the Owner whether or not such claim arises out of and/or have been caused in whole or in part by the negligence on the part of Mead & Hunt, Inc. 11. Mead & Hunt, Inc. will provide services in accordance with generally accepted professional practices. Mead & Hunt, Inc. disclaims all warranties and guarantees, express or implied. The parties agree that this is a contract for services and is not subject to any Uniform Commercial Code. Similarly, Mead & Hunt, Inc. will not accept those terms and conditions offered by the Owner in its purchase order, requisition, or notice of authorization to proceed, except as set forth herein or expressly agreed to in writing. Written acknowledgment of receipt, or the actual performance of services subsequent to receipt of such purchase order, requisition, or notice of authorization to proceed is specifically deemed not to constitute acceptance of any terms or conditions contrary to those set forth herein. 12. Mead & Hunt, Inc. intends to serve as the Owner's professional representative for those services as defined in this agreement, and to provide advice and consultation to the Owner as a professional. Any opinions of probable project costs, reviews and observations, and other decisions made by Mead & Hunt, Inc. for the Owner are rendered on the basis of experience and qualifications and represents the professional judgment of Mead & Hunt, Inc. However, Mead & Hunt, Inc. cannot and does not guarantee that proposals, bids or actual project or construction costs will not vary from the opinion of probable cost prepared by it. Owner agrees to hold Mead & Hunt, Inc. harmless for any claim arising out of or related in any way to project or construction costs even if such claims arise out of and/or have been caused in whole or in part by negligence on the part of Mead & Hunt, Inc. 13. If the Owner is a municipality or state authority, the Owner agrees to indemnify and hold harmless Mead & Hunt, Inc. for all claims arising out of or related in any way to acts done by Mead & Hunt, Inc. in the exercise of legislative or quasi-legislative functions. In the event Mead & Hunt, Inc. shall be made a party to any suit or litigation on account of an injury or damage to person, life, or property as a result of such acts done by Mead & Hunt, Inc. in the exercise of legislative or quasi- legislative functions, the Owner shall, at Owner's sole expense, defend such actions on behalf of Mead & Hunt, Inc. including claims and causes of action at common law, arising under any statute, or arising out of any governmental demand or request, and if judgment shall be obtained or claim allowed in any proceedings against Mead & Hunt, Inc. the Owner shall pay and satisfy such judgment or claim in full. 14. This agreement shall not be construed as giving Mead & Hunt, Inc. the responsibility or authority to direct or supervise construction means, methods, techniques, sequence, or procedures of construction selected by the contractors or subcontractors or the safety precautions and programs incident to the work of the contractors or subcontractors. 15. Mead & Hunt is not liable, in contract or tort or otherwise, for any special, indirect, consequential, or liquidated damages including specifically, but without limitation, loss of profit or revenue, loss of capital, delay damages, loss of goodwill, claim of third parties, or similar damages. 16. This agreement shall be construed and interpreted in accordance with the laws of the state of California. No action maybe brought except in the state of California. 17. This agreement cannot be changed or terminated orally. No waiver of compliance with any provision or condition hereof should be effective unless agreed in writing duly executed by the waiving party. 18. This agreement contains the entire understanding between the parties on the subject matter hereof and no representations, inducements, promises or agreements not embodied herein (unless agreed in writing duly executed) shall be of any force or effect, and this agreement supersedes any other prior understanding entered into between the parties on the subject matter hereof. CA General Terms and Conditions/lO-03 Page 2 of 2 Standard Billing Rate Schedule Effective January 1, 2004 Standard Billing Rates Clerical ................................................................................................................................. $47.00 / hour Arch. Tech. I, Engineering Tech. I, Technical Writer, Administrative Assistant, Accounting ........................................................................................................................... $56.00 / hour Architectural Tech. II, Engineering Tech. II, Surveyor- Instrument Person ........................ $68.00/hour Interior Designer, Technical Editor, Biologist ...................................................................... $68.00 / hour Engineer I, Scientist I, Architect I, Planner I ........................................................................ $72.00 / hour Engineering Technician III, Architectural Technician III ...................................................... $80.00 / hour Engineer II, Scientist II, Architect II, Planner II .................................................................... $84.00 / hour Registered Land Surveyor ................................................................................................... $84.00 / hour Senior Engineering Technician, Senior Architectural Technician ....................................... $91.00 / hour Senior Engineer, Senior Scientist, Senior Architect, Senior Planner, Senior Economist, Senior Editor .................................................................................................................... $100.00 / hour Project Engineer, Project Scientist, Project Architect, Project Planner ............................. $115.00 / hour Senior Project Engineer, Senior Project Scientist, Senior Project Architect, Senior Project Planner ....................................................................................................... $130.00 / hour Senior Associate ................................................................................................................ $145.00 / hour Principal ............................................................................................................................. $156.00 / hour Senior Client/Project Manager ........................................................................................... $156.00 / hour Expenses Geographic Information Systems ........................................................................................ $32.00 / hour Computer Aided Drafting System ........................................................................................ $16.00 / hour Engineering Computers Analysis ......................................................................................................................... $10.50 / hour Report Writing ................................................................................................................. $5.50 / hour Total Station Survey Equipment ................................................................................... $16.00 / hour Electronic Distance Measuring Equipment ...................................... (minimum charge) $37.00 / day Charges for other equipment may appear in a proposal Out-Of-Pocket Direct Job Expenses ............................................................................ cost plus 15% Such as reproductions, sub-consultants / contractors, etc. Travel Expense Company or Personal Car Mileage ....................................................................................... $0.47 / mile Air and Surface Transportation ........................................................................................... cost plus 15% Lodging and Subsistence ................................................................................................... cost plus 15% Billing & Payment Travel time is charged for work required to be performed out-of-office. A minimum of two hours will be billed for any work out-of-office. Invoicing is on a monthly basis for work performed. Payment for services is due within 30 days from the date of the invoice. An interest charge of 1.5% per month is made on the unpaid balance starting 30 days after the date of invoice. This schedule of billing rates is effective January 1, 2004, and will remain in effect until December 31, 2004, unless unforeseen increases in operational costs are encountered. We reserve the right to change rates to reflect such increases. ITEM NO. 8a DATE: NOVEMBER 3, 2004 AGENDA SUMMARY REPORT SUBJECT: ADOPTION OF RESOLUTION ADJUSTING USER FEES AT THE UKIAH REGIONAL AIRPORT At its September 7, 2004 meeting the Ukiah Airport Commission unanimously recommended that User Fees at the Ukiah Regional Airport be increased an average of 16 percent. Staff concurs with this action and recommends adoption of the proposed resolution to implement this fee adjustment. Airport fees have remained unchanged since 1996. Staff and the Airport Commission believe it is appropriate to adjust the fees at this time. This conclusion has been reached after reviewing rates at other airports, considering the condition of the facilities being rented, and past policy. Airport tenants were advised of this issue in the September 2004 quarterly airport newsletter. Of the 110 airport clients only one has expressed concern regarding the increase and that related to building maintenance. In June 2004, the City Council approved a Pavement Maintenance Program in the budget for the first time. If these proposed fees are adopted, staff intends to begin a Building Maintenance Program with the next fiscal year. RECOMMENDED ACTION:Adopt Resolution Adjusting User Fees At The Ukiah Regional Airport. ALTERNATIVE COUNCIL POLICY OPTIONS: 1. Determine fees are to modified, identify changes, and adopt revised resolution. 2. Determine fees are to remain the same and do not adopt resolution. Citizen Advised: Requested by: Prepared by: Coordinated with: Airport tenants and publicly noticed in Ukiah Daily Journal Airport Commission Paul Richey, Airport Manager Candace Horsley, City Manager Attachments: , . Resolution for adoption, page 1; Proposed fee schedule, page 2; Excerpt of the September 7, 2004 Airport Commission meeting minutes, pages 3-4; Airport Newsletter, page 5; Resolution No. 96-40, pages 6-7. APPROVED: '~~::~' Candace H~rsley, City~anager mfh:asrcc04 1103airport AI-I'ACH~ENT__~ RESOLUTION NO. 2005- RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH MODIFYING THE RENTAL RATES AND USER FEES AT THE CITY OF UKIAH REGIONAL AIRPORT WHEREAS, the City Council of the City of Ukiah desires to modify the rental rates for various building and user fees at the Ukiah Regional Airport; and WHEREAS, the City of Ukiah Airport Commission and City Staff have recommended rental rates for various buildings and fees for various operations; and WHEREAS, according to analysis and study the following are reasonable rental rates and fees for the types of buildings and operations at the airport; and WHEREAS, the increased rates and fees are necessary to meet current and projected costs associated with the operation of the Airport. NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Ukiah hereby adopts the following rates and fees for the Ukiah Regional Airport: ACTIVITY RATE Open Hangar rental - per month Port-a-Port hangar rental - per month Pasco Hangar (small) rental - per month Pasco Hangar (large) rental- per month Twin Hangar rental - per month Old Redwood Hangar rental - per month Shop Building #2 rental - per month Hangar Office rental - per month Office Space rental - per month Vehicle parking fee - per month Rental Vehicle parking fee - per month Individual Fuel Truck parking fee - per month Tie Down fee - per night Tie Down fee - per month Operations fee Landing fee $60.00 $1oo.oo $i25.00 $137.00 $165.00 $243.00 $337.00 $32.00 $0.87 per square foot $25.00 $6.00 $35.00 $5.00 $32.00 $128.00 $1.75 per 1,000 lbs. Rental agreements negotiated at these rates may be executed by the Airport Manager on behalf of the City of Ukiah. PASSED AND ADOPTED this 3rd day of November 2004 by the following roll call vote: AYES: NOES: ABSENT: ABSTAIN: Eric Larson, Mayor ATTEST: Marie Ulvila, Deputy City Clerk Resolution No. 2005- Page I of 1 Ukiah Regional Airport Proposed User fees Sept. 2004 Attachment # ~: illlll ii i i Description Existing Fees Proposed Fees Open hangar $ 52.00 $ 60.00 Port-a-Port (756 sq. fi.) $ 86.00 $100.00 Pasco Hangar (900 sq. fi.) $ 108.00 $ 125.00 Pasco Hangar (1000 sq, ft.) $118.00 $137.00 Twin Hangar (1102 sq. ft.) *$163.00 $165.00 Hangar Office $ 28.00 $ 32.00 Office Space $ .75 per sq. fi. $ .87 per sq. fi. Tie Down - per night *$ 4.00 $ 5.00 Tie Down - per month $ 28.00 $ 32.00 Vehicle Parking - per month * $ 20.00 $ 25.00 Rental Car Parking - per month *$ 4.00 $ 6.00 Operations Fees $110.00 $128.00 Landing Fees $ 1.75 per 1,000 lb. $ no change Fuel Truck Parking - per month Old Redwood Hangar *$ 28.00 $ 35.00 $ 209.00 $ 243.00 Shop Building # 2 $ 290.00 $ 337.00 The proposed fees indicate a 16% increase except where shown by asterisk If the proposed fee increase is adopted, it will increase airport revenues approximately $15,000 per yr. This equates to a 2% increase in airport revenues per yr. since 1996. Attachment the Airport Terminal grant being submitted in conjunction with a County grant concerning the Brush Street Triangle project to Economic Development Administration (EDA), He anticipates receiving an update on the grant application within 60 to 90 days. 5C. Airport Newsletter Mr. Richey referred to a copy of "Ukiah Plane Talk" for September as m~ example of the Airport newsletter sent to all'Airport tenants with their hanger billing. Chair Ashiku commented he noticed the newsletter contains information regarding the new fee schedule and inquired whether staff received any inquirie:~ in this regard, Mr. Richey responded "no." SD. Communication Ra.dio Installation Mr. Ric. hey reported the City Public Works Department recently installed an aviation communication radio with external speaker in the avgas truck, and the jet fuel truck will also have one installed at a later date. Mr. Richey addressed the issue of airpor~ security and reported hidden shut-off switches have been installed in both fuel trucks as part of the security precautionary measures taken. 6. DISCUSSION/ACTION 6A. Discussion of Airport User Fees. Continued Mr. Richey reported the Airport Commission discuss-~d the proposed new User Fee ,Schedule at the last regular meetinG. The user rates have remained static since 1996, when staff proposed a ~6 percent increase be applied across tl~e board, equating to roughly a two percent increase per year. The modest increase can assist with offsetting some of the repair/in~provement co,ts for the existing, old pavements and buildings at the Airport. The fee increase would Generate approximately $~ 5,000 in revenue annually. Additionally, staff intends to begin a Building Maintenance Program with these fees for the next budget year. The Commission supported the concept of increasin§ the user fees, notin§ this item was a§endized for further discussion because Commissioners questioned the rental rate of the Port-A-Port Twin hangar on the issue of price per square feel Accordingly, staff revised the schedule to include the square foota§e and pric~ per ~quare foot for each hangar group, as follows: Port-A-Port (756) sq, ft, $100 Pascoe (900) sq. ft, $125 Pascoe (1000) sq, f. $137 Port-A-Port Twin (1102 sq. ft,) $165 13.2 cents per sq, ft. 13.8 cents per sq, ft. 13.7 cenls per sq. ft, 14,7 cents per sq. fl. Minutes of the Airport Commission Page 3 Seplember 7, 200,~ Mr. Richey reported staff is recommending a rate of $165 for the I:'ort-A-Po~t Twin hangar. Mr. Richey stated the City raised rates for the Old Redwood hangar and Shop Building No. 2 by City Council resolution instead of by Individual lease agreement with Council approval. Staff proposed the rates be included in the ~ee schedule rather than incorporated into individual Jease agreements. He referred to the~ proposed User Fee Schedule dated Septembe~ 4, 2004, to demonstrate the existing fees and the proposed new fees. It was the consensus of the Commissioners present to support staff's proposal that the fee increases for the Old Redwood hangar and Shop Building No. 2 be incorporated by Council resolution as opposed to separately negotiated contracts. Chair Ashiku requested clarification from staff that 'the proposed new fees adequately represent and are consistent with the guideline fee standards established by like regional airports. Mr. Richey replied affirmatively. Additionally, the revised fee schedule reflects consideration given to factors such as the condition of the buildings, the necessary maintenance/repairs, arid past fee increase practices at the Ukish Municipal Airport. ON A MOTION by Commissioner Beard, seconded by Vice-Chair Whetzel, it was carried by an ali AYE voice vote of the Commissioners present to recommend approval of the revised User Fee Schedule and that the percentage increase is consistent with other like airports surveyed as part of the user fee analysis and past practices. 6B. . Discussion of Pavement Maintenance Pr~.am - .~ontinued Mr. R~chey reported Commissioners Dee~v-~r an~'~3 '--~,~.~-~ ~"~o~np~ted a waJk around of the Airport facility for the purpose of cataloging and prioritizing the pavement areas requiring repair, ' ' Vice-Chair Whetzel referred to an Airport Layout Plan, and recommended the Commission discuss and prioritize pavement areas requiring rehabilitation. -['he element of use was also taken into consideration when prioritizing the necessary repair areas. A general discussion followed regarding the level (slurry seal or more intense repair), materials, and cost factors in terms of the respective square footage involved with repairing the Airport aprons, taxiways, tie down, a¢~d run-up areas. Vice-Chair Whetzel and Commissioner Deerwester recommended [he following: Minutes of the Airport Commission Page 4 September 7. 2004 City of Ukiah Regional Airport Attachment UKIAH PLANE TALK N EWSLETTERNEWSLETTERNEWSLETTERNEWSLETTERNEWSLETTERNEWS September 2004 MANAGERS MESSAGE On August 1, 2004, The City Manager appointed me to the position of Airport Manager permanently, so for better or worse folks, here I am. Also, Personnel Department is recruiting for the Airport Assistant position at this time, and we should have this recruitment completed within a month or so. Gordon Gore continues to fill the Airport Assistant position on an interim basis until the recruitment is completed, he will then go back to his Airport Maintenance position on a part time basis. We will continue to keep you informed as personnel issues change. I also want to thank everyone who supported my efforts to gain this position. Paul Richey AIRPORT HAPPENINGS Since the City Council adopted our budget, included is a line item for a Pavement Maintenance Program. We are reviewing all of our pavement and prioritizing for repair/rehabilitation. This process is being coordinated with the Airport Commission. Each year we will repair a portion of our pavement until the entire facility is done and then we start over again. As some of you may have noticed, we have begun the process already with repaying of the south access road by the nursery, and the large sink holes just north of the old Ace Duster hangar. The time has come that everyone hates to hear BUT, the Airport Commission is reviewing all Airport rental rates. Our rates have been static since 1996 and it is time to increase fees. Staff is recommending a across the board 16% increase in fees which reflects a 2% per year cost of living increase. Because we have old pavement, old buildings, old everything, staff feels a modest increase is in order. If these fees are increased as proposed, it will result in an increase in Airport revenue of approximately $15,000.00 annually. It is staff's intention to begin a Building Maintenance Program with these fees with the next budget year. Attached is a copy of the proposed fees. This issue will be discussed at the Airport Commission meeting on September 7, 2004. If approved, this proposal must be adopted by City Council. Page 1 Attachment 1 3 RESOLUTI~ NO. ..... ~0 RESOL~ON OF THE CITi/' COUNCIL OF THE CITY OF UKIAH MODIFYING THE RENTAL -RA~ AND USER FEES AT THE CITY OF UK[AH RE~, IONAL AIRPORT 5 WHEREAS, the City Council of the City of Uldah desires to modify the rental rates 6 for various buildings and user fees at thc Ukiah Regional Airport; and 7 WHEREAS, the City of Ukiah Airport Commission and City Staff have recommended 8 rental rates for various buildings; and I0 WHERt~AS, it appears from studY"that the following ar~ rea,tonablc rental rates for ! ! the various types of buildings in question, and 12 WHEREAS, the increased rates are neces~ to meet current and projected, costs 11] associated with the operation of the Airport. It NOW, THEREFORE, BE IT RESOLVED the City Council of the City of Ukiah d~s 15 hereby resolve that the following rates shall b~ used: 16 18 Open Ha. nEar $ 52.00 Per Month 19 Pon-a-Pon, Single Hangar ~0 Pa.w~ Hangar (Small) 21 Pasco Ha~gar ~ Tw~ 24 ~$~ Offi~ Offi Aircra/t Tie Down $ 86.00 Per Month $108.00 Per Month $118,00 Per Month $163.00 Per Month $ 28.00 Per Month $ 0.75 Per Square Foot $ 28,00 Rental Car Park Operations F~ By Permit $20.00 Per Month or any pa. ~er~of exceeding one week $ 4.00 Per Mon~ $110.00 Per Month $ 7 8 9 10 11 Landing Fees $1.75 Per 1000 pounds, Exceeding 12,500 pounds (aircraft weigh0 Fuel Truck Fee. '$ 28.00 Per Month Rental agreements negotiated at these rates may be executed by the Airport Manager on behalf of the City of Ukiah. PASSED AND ADOPTED this roil ~ vote: 7th,_j day of.. Febnmry., 1996, by the following NOES: Councilm~rs Mastin, Malone, Watt~m~!~urger, Shoemaker and Mayor Schn~ None 16 17 18 ABS~: None ABSTAIN: 19¸ 20 · . ~ayor 9.1 ATTEST:/~, : / ........ AGENDA SUMMARY ITEM NO: 8b DATE: November 3, 2004 REPORT SUB.1ECT: ADOPTION OF RESOLUTION APPROVING THE PROPOSED MITIGATED NEGATIVE DECLARATION FOR THE WASTEWATER TREATMENT PLANT IMPROVEMENT PROJECT SUMMARY: The City Public Utilities Department has designed improvements to the existing wastewater treatment plant to improve the liquid treatment, solids treatment, and advanced water treatment processes to meet current and potential future regulatory requirements. In addition, the improvements are intended to restore and increase capacity to accommodate the growth within the City as established in the General Plan, and in the Ukiah Valley Sanitation District per the draft Ukiah Valley Area Plan. A detailed Project Description is included in the Initial Study/Mitigated Negative Declaration distributed to the City Council under separate cover last week. This Agenda Item seeks City Council adoption of a Resolution approving the recommended Mitigated Negative Declaration for the project. BACKGROUND: In order to comply with the requirements of the California Environmental Quality Act (CEQA), the City, with the assistance of professional consultants Scheidegger & Associates, prepared an Initial Environmental Study to determine if the project would have potentially significant adverse impacts on the environment. With the guidance of Mr. Scheidegger, City Staff incorporated a number of"Control Measures" (page 2-8 of Initial Study), which are procedures known to further reduce the potential impacts based on regulatory agency requirements, standards in the industry, and operating experience. These Control Measures addressed aesthetics, agriculture, air quality, biological resources, geology and soils, hazards and hazardous materials, hydrology and water quality, noise, and transportation/traffic. (continued on page 2) RECOMMENDED Ac'ri:ON: After the conduct of a public hearing, adopt the proposed Resolution approving the Mitigated Negative Declaration for the Wastewater Treatment Plant improvement project. ALTERNATIVE COUNCIL POLICY OPTION: Do not adopt the proposed Resolution approving the Mitigated Negative Declaration and provide direction to Staff. Citizen Advised: Noticed according to the requirements of the Ukiah Municipal Code Requested by: Department of Public Utilities Prepared by: Charley Stump, Director of Planning and Community Development Coordinated with: Candace Horsley, City Manager and David Rapport, City Attorney Attachments: 1. Resolution 2. Proposed Mitigated Negative Declaration (distributed to Council on October 27, 2004) 3. Comments and Response to Comments (distributed to Council on October 27, 2004) Candace Horsley, Cit3XManager 1 ANALYSI'S METHODOLOGY: After identifying standard control measures, the consulting team completed an environmental checklist (page 3-1 of the ]:nitial Study), which identifies the environmental topics CEQA requires an agency to analyze. An :Impact Analysis discussion is provided for each environmental topic. The discussion lists any control measures incorporated into the project, and analyzes the potential impact to determine how severe it might be. Conclusions were then made as to whether no impact, a less than significant impact, a less than significant impact with mitigation incorporated, or a potentially significant impact would result from the project. POTENT]:ALLY STGNI'FTCANT ADVERSE IMPACTS: Even with the Contro/Measures, Scheidegger & Associates found that the proposed wastewater treatment plant improvements would result in potentially significant adverse impacts to biological and cultural resources (Summary of F/nd/ng~. page 2-10 of the Tnitial Study). The consulting team, which included biological and cultural resources specialists, clearly defined the potential impacts and explored possible alternative ways to mitigate them. Potential ]:mpacts to Bioloqical Resources 1. Construction activities could disrupt nesting activities during the nesting season (March I through August 31). 2. Project development may directly impact 0.2 to 0.5 acres of potentially jurisdictional man-made drainage ditches and seasonal wetlands. Potential Impacts to Cultural Resources 3. Ground disturbance and excavation activities could unearth significant cultural resources or human remains. RECOMMENDED MZI'~GA'r]:ON MEASURES: As detailed on page 2-11 of the ]:nitial Study, the consulting team identified six (6) mitigation measures to successfully offset impacts to biological resources, and two (2) mitigation measures to offset impacts to cultural resources. Accordingly, it was concluded that a Mitigated Negative Declaration for the project would comply with the requirements of CEQA. A Mitigation Monitoring and Reporting Program is also included in the Mitigated Negative Declaration. PUBL]:C REVZEW AND COMMENTS: The proposed Mitigated Negative Declaration was widely distributed for the mandatory 30-day public review period last summer. Public notices regarding the availability of the document for review were similarly distributed to interested agencies, citizens, groups and organizations. Written responses to the document were received from the State Department of Fish and Game, State Department of Transportation - Division of Aeronautics, Mendocino County Department of Planning and Building Services, U.S. Army Corps of Engineers, the Ukiah Airport Manager, adjoining property owners Richard and Donna IVlattern, and from the law offices of Steven Belzer, representing the Matterns. A wide variety of specific comments were made by these responders, which CEQA requires the lead agency to respond to before formally determining the adequacy of the recommended Mitigated Negative Declaration. RESPONSE TO COMMENTS: Scheidegger & Associates, with the assistance of City Staff and the City Attorney, prepared responses to the comments made by reviewers of the document (comment letters and response to comments distributed with Initial Study and Mitigated Negative Declaration). It was the conclusion of Scheidegger & Associates, Staff and the City Attorney that the comments could be successfully responded to, and that the proposed Mitigated Negative Declaration was still appropriate for the project and met the requirements of CEQA. CONCLUS~[ON: Based on the analysis, findings, and conclusions contained in the Initial Environmental Study, Scheidegger & Associates and Staff are recommending that the City Council approve the Mitigated Negative Declaration for the project. RECOI~II~IENDED AC11:ON: After the conduct of a public hearing, adopt the proposed Resolution approving the Mitigated Negative Declaration for the Wastewater Treatment Plant improvement project. RESOLUTION NO. ATTACH~IEN-[.,~ RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING A MITIGATED NEGATIVE DECLARATION FOR THE CITY WASTEWATER TREATMENT PLANT IMPROVEMENT PROJECT WHEREAS: 1. The City of Ukiah has designed improvements to the existing wastewater treatment plant to improve the liquid treatment, solids treatment, and advanced water treatment processes to meet current and potential future regulatory requirements. 2. The City of Ukiah, as Lead Agency, has prepared an Initial Environmental Study for the Ukiah Wastewater Treatment Plant Improvement project; and 3. The Initial Environmental Study revealed that the project could have significant adverse environmental impacts on biological and cultural resources; and 4. The Initial Environmental Study identified reasonable and feasible mitigation measures to successfully offset the potentially significant biological and cultural resource impacts to insignificant levels; and 5. CEQA Guidelines Section 15074 requires the City to consider the proposed Mitigated Negative Declaration together with all comments received during the public review process prior to approving the project; and NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Ukiah finds as follows: 1. The Mitigated Negative Declaration was prepared and made available for public review and comment in full compliance with the procedures set forth in CEQA and the CEQA Guidelines. 2. The Mitigated Negative Declaration, public comments, and responses to comments were considered by the City Council at a noticed public hearing on November 3, 2004, which was conducted in full compliance with all legal requirements. 3. The City Council has considered all documents submitted for consideration prior to or during the hearings it conducted and all testimony presented during the hearings as well as the Mitigated Negative Declaration, public comments, response to comments, the Agenda Summary Staff Report, dated November 3, 2004, and all other documents comprising the administrative record of this decision, including the complete file in the City's Planning and Community Development Department and all studies and reports conducted, prepared or submitted in connection with the preparation of the Initial Environmental Study and Mitigated Negative Declaration. The Staff Report is incorporated herein by reference. The City Council has also independently reviewed and considered this Resolution. 4. Measures designed to avoid or substantially lessen significant effects of the wastewater improvement plant project will be imposed on the project. In this way, full mitigation will be achieved. 5. The following lists the identified significant adverse impacts and corresponding mitigation measures: 1 of 3 Impact 1. Construction activities could disrupt nesting activities during the nesting season (March I through August 31). 2. Project development may directly impact 0.2 to 0.5 acres of potentially jurisdictional man-made drainage ditches and seasonal wetlands. Recommended mitigation measures · If construction takes place outside of the nesting season (March :1 to August 31), then no mitigation is required. Tf construction takes place between March :1 and August 3:1, a preconstruction nesting bird survey shall be conducted by a qualified biologist 30 days prior to the start of any construction activities to determine the presence of nesting raptors within 300 feet of construction activity and nesting songbirds within 50 feet of construction activity. If no nesting birds are located, then no further mitigation is required. ]f construction activities are delayed or suspended during the nesting season for more than 30 days after the preconstruction survey, the site shall be re- surveyed. · :If nests are located, then a qualified biologist will establish an avoidance area around each raptor nest site a minimum of 500 feet from the nearest construction activity and around each songbird nest site of a distance to be determined by a qualified biologist based upon the species. Tf the establishment of an avoidance area for a nest is not possible, then the City shall defer construction until a qualified biologist has determined that the young have fledged. Tn addition, a consultation with CDFG shall be conducted to determine appropriate avoidance measures. Prior to the start of construction, the City shall retain a qualified biologist to identify and flag for avoidance all potential Waters of the U.S. including wetlands falling within 50 feet of the impact area. · The City shall obtain the appropriate Clean Water Act, Section 404 permit from the Corps, if necessary, for the fill of the seasonal wetlands that occur on the site. The City shall fulfill any mitigation measures required by the Corps. · The City shall obtain a Section 401 Water Quality Certification, if necessary, from the RWQCB. · If impacts are proposed for the drainage ditches located on the Project site, and they are determined to be CDFG jurisdictional, then the City shall obtain a Streambed Alteration Agreement from CDFG for work done in the drainage ditches and comply with permit conditions. 2of3 9. A Mitigation Monitoring and Reporting Plan (Exhibit A) has been prepared in accordance with CEQA, and found adequate by the City Council. 10. On September 2, 2004, the Mendocino County Airport Land Use Commission conducted a public hearing and found that the Ukiah wastewater treatment plant improvement project would not cause or create safety hazards or noise problems for persons using the airport or for persons residing or working in the project area, and that the project was consistent with the Mendocino County Airport Comprehensive Land Use Plan. 11. Conclusions: The City Council is able to conclude that based on the v,.hole of the record, there is no substantial evidence that the project, as mitigated, may have a significant effect on the environment, and that the Mitigated Negative Declaration reflects the City Council's independent judgment and analysis. 12. All documents constituting the record upon which the City Council's decision is based can be reviewed at the City of Ukiah Department of Planning and Community Development, 300 Seminary Avenue, Ukiah, CA 95482. Custodian of the documents: Director of Planning and Community Development. PASSED AND ADOPTED this 3rd day of November 2004, by the following roll call vote: AYES: NOES: ABSENT: ABSTAIN: Eric Larson, Mayor ATTEST: Marie Ulvila, Deputy City Clerk 3of3 0 AGENDA SUMMARY ITEM NO. 9a DATE: November 3, 2004 REPORT SUBJECT: PUBLIC INFORMATION REGARDING STREET SWEEPING IN RESIDENTIAL AREAS Staff has been working to prepare public information regarding routine sweeping in the residential areas. It is thought that armed with additional information the public could help make the sweeping effort more effective by moving vehicles on sweeping days. Attachment 1 is comprised of two sheets that contain the information-that is proposed to be included on the City's website. This information would also be reformatted to fit a flyer that could be handed out at the counter or sent out with a utility billing. The information will be presented in both English and Spanish flyers. Examples of both are included as Attachment 2. Attachment 3 is a map of the City of Ukiah, prepared in GIS, where each route is color coded. The colors correspond to the table in the website and in the English and Spanish flyers, that indicate the planned sweeping dates through the end of 2005. The website would be updated periodically to roll the schedule ahead in time or to reflect any changes that are made to the routes. The street sweeping schedule is affected by the availability of staff, and must be coordinated with the curbside waste collection schedule. Staff recommends the City Council review the information and provide staff with appropriate comments. After recommendations of Council are received and incorporated, a final proofreading will be coordinated with David Martinez, who provided the initial translation to Spanish. RECOMMENDED ACTION' Provide comments to Staff regarding the content and format of the public information literature. ALTERNATIVE COUNCIL POLICY OPTIONS: N/A Citizen Advised' N/A Requested by: Diana Steele, Director of Public Works/City Engineer Prepared by: Diana Steele, Director of Public Works/City Engineer Coordinated with: Candace Horsley, City Manager Attachments: 1. Website Information - 2 sheets 2. Residential Street Sweeping Information brochures 3. Street Swe.._.,eping Route Map AP P ROVE D :~~,',-~,~~_ ~ Candace Horsl0ky, City Manager CITY OF UKIAH Resident. iai Street Sweeping Information Typically street sweeping is performed every other week in residential areas and weekly in downtown commercial areas. Sweeping helps keep our communities attractive and also reduces the amount of sediment, organics and trash that enter the storm drains and creeks. Frequency of sweeping is increased as needed during leaf season. Affachment # t The residential areas of the City are divided into five routes, one for each day of the week. Areas served are highlighted on the enclosed map to show which day of the week sweeping takes place. Click on this link to view the Street Sweeping Route Map. The dates during each month when sweeping is planned to take place on your route are listed in the color coded table enclosed. Click on this link to view the Sweeping Route Dates. To be effective, the street sweeping machine must be able to get the face of the curb with the brooms. Cars parked along the curb, and garbage toters left on the street prevent this from happening. You can help make the City street sweeping efforts more effective by moving your car to an off-street parking space on sweeping day and removing your garbage containers from the street in a timely manner. If you have questions regarding the schedule, please call the Street Department at 707-467-2814. Thank ttou ['or ~lour help ! ! CITY OF UKIAH Informaci n acerca de Barrer de Calle en Areas Residenciales Tipicamente barrer de calle se realize cada dos semanas en las ,~reas residenciales y semanal en el centre ,~reas comerciales. General ayudan a mantener nuestras comunidades atractivas y reduce tambi~n la cantidad de sedimento, org,~nico y la basura que entra los desaguaderos de la tempestad y riachuelos. La frecuencia de barrer se aumenta como necesitada durante la temporada de hoja. Las ~reas residenciales de la Ciudad se dividen en cinco rutas, uno por cada dfa de la semana. Las ~reas sirvieron son destacados en el mapa dentro de mostrar cu~l dfa del barrer de la semana sucede. Las fechas durante cada mes al barrer es planeado suceder en su ruta son listados en la mesa en la espalda de este folleto. Ser efectivo, la calle que barre m,~quina debe ser capaz de obtener la cara del limita con las escobas. Los coches estacionados por el limita, y recept,~culos de basura que no se quitan de la calle previenen esto de acontecimiento. Usted puede ayudar la marca la calle de la Ciudad que barre los esfuerzos m,~s efectivos moviendo su coche a un espacio fuera de la vfa pt~blica del estacionamiento en el dfay quitar generales sus contenedores de basura de la calle en una manera oportuna. Si usted tiene las preguntas acerca del horario general visitan per favor la City of Ukiah Civic Center en 300 Seminary Avenue. iGracias para su a~luda.~ SWEEPING ROUTE DATES 2004 '"' '":"'9 11- H 12 Nov ~!ii:i. ii,ii~ ::' i: i:' 25 26 Dec 9 10 23- H 24- H 2005 ~ 4 ~ 6 7 Jan 20 21 Feb . i ~ 2 3 4 i6 17 18 Mar "'" ':'!'iii 3 4 17 18 Apr 'i :'"::"!12 14 1 29 : ::2~ 26 27 Jun :' 9 10 Aug ~iii~ii ~ii!i 4 5 18 19 29 30 oct "' ':H ?,'r,'i ~i 13 ~4 27 2~ Nov ~ !'i ' 10 11-H ~ii ~i! 24- H 25- H ~'??! ~?i~i! 20 ,':~; ';r"~ 22 23 ~~ ~ 30 I 9 20 2 3 Feb ~?~~ ? ;" 16 17 2 3 30 31 Color coding and day of week corresponds to the map inside. Dates in the table above that are printed in Bold and followed by - H are City-recognized holidays. Sweeping will be performed as soon as practical in the days that follow. Colore la codificacidn y el d£a de corresponder de semana al mapa adentro. Las fechas en la mesa encima de que son impresos en Bravo y seguidos por - FI es las vacaciones del la ciudad. Barrer se realizarA tan pronto como prActico en los dias que siguen. MALAGA DR. TOI~y AVE. CH ABLtS; DR:. KUKI RD: Affachment # FORD RD. H ST. GIORNQAVE. Legend Monday Tuesday Wednesday Thumday Friday Sweeping Route Map AGENDA SUMMARY ITEM NO. 9b DATE: November 3, 2004 REPORT SUBJECT: RESTRICTIONS ON APPOINTMENT OF CITY COUNCIL MEMBER TO FILL VACANCY At the last City Council meeting, Councilmember Smith asked a hypothetical question concerning the appointment to fill the existing vacancy on the City Council. In the hypothetical, Councilmember Rodin and Mayor Larson are not reelected on November 2, but apply for the vacancy. Councilmember Smith wanted to know what legal restrictions would apply to Councilmember Rodin and Mayor Larson, since they would still be in office when this appointment is made. At that meeting, the City Council scheduled a special or continued regular meeting for November 10, 2004, to consider the appointment. Upon reflection, I believe the answer to Councilmember Smith's question should await the outcome of the election. Depending on the outcome, it may not be necessary to answer the question at all, or only one of the two incumbents might not be reelected. Since these different outcomes may make the answer quite simple or quite complex, I believe it is better to address this issue after the election based on actual facts rather than hypothetical situations. I will make an oral report at the meeting, if necessary. RECOMMENDED ACTION: Receive City Attorney's oral report at the meeting. ALTERNATIVE COUNCIL POLICY OPTIONS: N/A Citizen Advised' Requested by: Prepared by: Coordinated with: Attachments: N/A City Council David J. Rapport, City Attorney Candace Horsley, City Manager None APPROVED:'~~ · Cahdace H°rsley, City M~nager AGENDA SUMMARY ITEM NO. DATE: REPORT lOa November 3, 2004 SUBJECT: REGULATION OF GROWING MARIJUANA AND MARIJUANA DISPENSARIES UNDER COMPASSIONATE USE ACT SUMMARY: Recent events have focused attention on City residents who are growing marijuana in their backyards. There have been publicized complaints about the odor of mature marijuana gardens that has created a nuisance for neighbors and persons in the neighborhood. A resident was recently shot in the hand by a man who had allegedly climbed the fence into his backyard for the purpose of stealing marijuana plants he was growing there. There are also two medical marijuana dispensaries operating within the City limits that we know of. The purpose of this Agenda Summary Report is to describe the law, the City Council's options, if it chooses to regulate this activity, and report what some other cities are doing. THE LAW Proposition 215 or the Compassionate Use Act (Health and Safety Code ("H & S Code") {}11362.5, declares that: "seriously ill Californians have the right to obtain and use marijuana for medical purposes where that medical use is deemed appropriate and has been recommended by a physician who has determined that the person's health would benefit from the use of marijuana in the treatment of cancer, anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis, migraine, or any other illness for which marijuana provides relief." The Act provides that H & S Code §11357, making it a crime to be in possession of marijuana, and §11358, making it a crime to cultivate marijuana, "... shall not apply to a patient, or to a patient's primary caregiver, who possesses or cultivates marijuana for the personal medical purposes of the patient upon the written or oral recommendation or approval of a physician." [Continued on page 2] RECOMMENDED ACTION: Review alternatives and provide direction to Staff. ALTERNATIVE COUNCIL POLICY OPTIONS: N/A Citizen Advised: Requested by: Prepared by: Coordinated with' Attachments: N/A City Council David J. Rapport, City Attorney Candace Horsley, City Manager; John Williams, Police Chief Marijuana Dispensary Ordinance, City of Citrus Heights APPROVED: ~ ~,~~"~, Candace Horsley, ~ty Manager The Act defines "primary care giver" as "... the individual designated by the person exempted under this section who has consistently assumed responsibility for the housing, health, or safety of that person." The Act also states that: "Nothing in this section shall be construed to supersede legislation prohibiting persons from engaging in conduct that endangers others, nor [sic] to condone the diversion of marijuana for non-medical purposes." The Compassionate Use Act legalized the cultivation, possession and use of marijuana by patients and caregivers for medical purposes. It did not legalize the sale of marijuana which is a crime under H & S Code §11360. (See People ex reL Lungren v. Peron (1997) 59 CaI.App.4th 1383. But also see _People v. Konow (2004) 32 Cal. 4th 995, 1003, which suggests that a primary caregiver might be entitled to recover from his patient the actual cost of growing marijuana.) Because of the uncertainty in Proposition 215 as to how much marijuana a patient or a primary caregiver can possess for the medical use of the patient, the state legislature has weighed in with a program requiring county health departments to issue medical marijuana identification cards to patients and caregivers. The patients and caregivers are not required to use the ID cards and their failure to have one doesn't mean they are not protected by the Compassionate Use Act. Moreover, local jurisdictions aren't prohibited from establishing their own programs and from using more generous standards than the state legislation uses. For purposes of this discussion, the important provision of this recent legislation is Health & Safety Code §11362.77 which establishes a base number of plants a patient or primary caregiver can possess as follows: "... no more than six mature or 12 immature marijuana plants per qualified patient." In addition, if a"... qualified patient or primary caregiver has a doctor's recommendation that this quantity does not meet the qualified patient's medical needs, the qualified patient or primary caregiver may possess an amount of marijuana consistent with the patient's needs." The possession and cultivation of marijuana still violates the federal Controlled Substances Act (21 U.S.C. § 801 et seq.) and the interplay between the federal law and the Compassionate Use Act has been the subject of several recent court decisions.~ Other than to note this conflict, I will not discuss the issue further in this report. OPTIONS The City's options with respect to backyard marijuana gardens and marijuana dispensaries range from doing nothing to the outright banning of the cultivation of marijuana and/or the operation of marijuana dispensaries within the City. ~ See, e.g. Raich v. Ashcrofl, 352 F.3d 1222 (9th Cir. 2004), cert. granted 124 S. Ct. 2909 (June 28, 2004) [Court of Appeal ruled that Controlled Substances Act is unconstitutional as applied to possession or cultivation of marijuana for personal use under the Compassionate Use Act, because this purely intra-state activity in compliance with state law is beyond reach of Congress under the Interstate Commerce Clause. The activity has no connection with interstate commerce, since the possession, growing and use all takes place exclusively within California. The U.S. Supreme Court has agreed to hear this case which is pending before the high court.] 2 In between those two extremes, the City could enact zoning regulations which allow either or both activities subject to regulation. 1. Regulation of backyard marijuana gardens With respect to backyard marijuana gardens, the regulations could take any or all of the following forms: 1. Limit to specific zoninq districts. The City might designate the zoning districts in which marijuana can be grown under the Compassionate Use Act. For example, it could limit such activity to agricultural and/or residential districts and prohibit it in all other zoning districts; 2. Limit to areas within zoninq districts. The City could permit it in residential districts but not within 500 feet of schools or parks or in areas with higher crime rates, for example; 3. Establish requlations for the use. The City could make the activity an allowed use in certain zoning districts but only in compliance with certain requirements, such as limiting the number of plants to six mature plants and 12 immature plants per patient, requiring the plants to be located so they are not visible from neighboring properties or public property or streets, and/or requiring the plants to be enclosed and secure from unauthorized entry; 4. Require a use permit. The City could make the growing of marijuana a permitted activity in designated zoning districts, requiring a use permit. Through the process of applying for and being granted a use permit, the City could verify that the marijuana is being grown in compliance with the Compassionate Use Act and the City's zoning regulations. In addition, the permit could be revoked, if the user violates the conditions in the permit. Example of how a use permit miqht work. One possibility for the use permit could work as follows. The zoning ordinance could be amended to provide that growing marijuana in the City requires a minor use permit which may be issued by the zoning Administrator, subject to conditions set forth in the ordinance. An applicant would have to submit an ID card or a doctor's recommendation with his or her application for the use permit. If claiming to be a primary caregiver, the applicant would have to submit this information for each patient as well as a statement by each patient under penalty of perjury that: (1) the patient lives in an apartment or in housing where marijuana cannot be grown for his or her personal use, and (2) the caregiver has consistently assumed responsibility for the housing, health, or safety of that person. As one means of limiting the number of properties where more than 12 immature plants and six mature plants can be grown, the ordinance could require that marijuana be grown at the patient's residence whenever possible. A primary caregiver could plant and tend the plants on the patient's property rather than grow marijuana on one lot for multiple patients. The application could be required to include a diagram of the property showing the location where the marijuana will be grown and that the area is fully enclosed and secure from unauthorized entry. The permit would be personal to the person in lawful possession of the property and would terminate, if that person no longer retained that possession. The permit could specify the number of plants authorized based on the standards in H & S Code §! 1362.77. 2. Marijuana dispensaries Similarly, with respect to dispensaries, the City could limit the zoning districts in which the dispensaries are allowed and impose requirements with or without a use permit. (See, for example, the ordinance adopted by the City of Citrus Heights, attached as Attachment 1.) 3. Problem with outright ban of backyard marijuana gardens An outright ban on backyard marijuana gardens might conflict with the declaration in the Compassionate Use Act that "seriously ill Californians have the right to obtain and use marijuana for medical purposes." Since backyard gardens are normally an accepted use associated with a single family residence and marijuana growing by a patient or his or her primary caregiver is allowed under state law and, in fact, a patient has a right under state law to obtain marijuana for medical purposes, it could be argued that an outright ban conflicts with controlling state law and is preempted by state law. At the same time, the City clearly has the police power authority to adopt zoning regulations which determine where certain otherwise lawful uses are allowed or permitted within the City in order to avoid incompatible or conflicting land uses. It may also regulate to avoid public nuisances and activities that create public safety concerns. The recent events concerning backyard marijuana gardens indicate that both public nuisance and public safety concerns are associated with this activity. The Compassionate Use Act itself states that it is not intended to "... supersede legislation prohibiting persons from engaging in conduct that endangers others, nor [sic] to condone the diversion of marijuana for non-medical purposes." The proposed City zoning legislation would be intended to prevent conduct that endangers others and the diversion of marijuana for non- medical purposes. Moreover, there are certain practical considerations in deciding whether to ban the activity or to allow it subject to regulation. While banning the activity will require patients and primary caregivers to obtain marijuana by growing it somewhere other than in their backyards, regulating the backyard growing of marijuana is problematic. If the City requires permits, it could create an accessible public record of the location where marijuana is being grown in the City which could be useful to potential thieves. If the City begins issuing use permits, the processing of those applications and the enforcement of permit conditions could tax limited resources in the City's planning department. The City might defend a decision to ban backyard marijuana gardens on the grounds that they create public nuisance and public safety problems which might be reduced by regulation but because of the practical problems with regulation, the City has elected to ban marijuana gardens as the more feasible method of addressing those problems. The issue of state law preemption could be avoided entirely by reasonable regulation of marijuana growing in residential districts rather than imposing an outright ban. 4. Ban or moratorium on marijuana dispensaries An outright ban or moratorium on dispensaries poses a lower risk of conflict with state law, since the sale of marijuana is still illegal and the definition of primary caregiver appears to require that the caregiver have consistently assumed responsibility for the patient's housing, health, or safety; something an operator of a dispensary would have difficulty establishing for every customer. OTHER JURISDICTIONS I have not been able to identify any other city or county that has attempted to regulate backyard marijuana gardens. I know that the City of Willits will be considering either a ban or regulation. A number of other jurisdictions have either banned or adopted ordinances regulating marijuana dispensaries. As an example of an ordinance regulating dispensaries, attached as Attachment 1 is the ordinance from Citrus Heights which requires a "medical cannabis dispensary" to apply for and receive a permit jointly issued by the City Manager and the Police Chief. It is a one year permit. Other cities which are regulating marijuana dispensaries with similar ordinances or under their zoning ordinances include Elk Grove, Berkeley, Oakland, Sacramento, Redding, Roseville, Plymouth, Dixon, and Woodland. Cities which have banned or imposed a moratorium on marijuana dispensaries include Rocklin, San Rafael, Fremont, and Temecula. It is recommended the City Council discuss these issues and provide direction to Staff. AGENDA SUMMARY ITEM NO. ].ob DATE: November 3, 2004 REPORT SUBJECT: ADOPTION OF RESOLUTION FINDING NEGATIVE DECLARATION CERTIFIED ON MARCH 3, 2004, ADEQUATE FOR FINAL DESIGN OF WATER TREATMENT PLANT UPGRADE PROJECT AND APPROVING THE FINAL DESIGN SUMMARY: On March 3, 2004, the City Council adopted a mitigated negative declaration, mitigation monitoring program, approved SPH Associates' design recommendation for the water system improvement project, and authorized proceeding with final design of the project. As originally proposed, the treatment plant improvements consisted of installing two additional treatment modules in the City's water treatment plant (WTP), each module having a nominal treatment capacity of 3 million gallons per day (mgd), installing additional and rebuilding pumps, and other associated improvements as required by the California Department of Health Services (DHS) municipal water system regulations. On April 7, 2004, the City Council withdrew its approval for the final design of the water treatment plant upgrade project involving the installation of the two additional treatment units. At that time, it was determined the additional treatment capacity had the potential to be growth inducing and any associated increase in underflow diversion could negatively impact the Russian River. The details of the City Council's determination are given in the attached resolution. (Continued on page 2) RECOMMENDED ACTION: Adopt Resolution Finding Negative Declaration Certified on March 3, 2004 Adequate for Final Design of Water Treatment Plant Upgrade Project and Approving the Final Design for Said Plant. ALTERNATIVE COUNCIL POLICY OPTIONS: Adopt a modified version of the resolution or not adopt a resolution. Citizen Advised: Requested by: Prepared by: Coordinated with: Attachments: N/A Bernie Ziemianek, Public Utilities Director Ann Burck, Project Engineer/Manager and Bernie Ziemianek, Public Utilities Director Candace Horsley, City Manager 1. Resolution for adoption 2. 22 California Code of Regulations §64659, paragraphs (a) and (b). APPROVED:' Candace Horsley, City ~anager Adoption of Resolution Finding Negative Declaration Certified On MARCH 3, 2004, Adequate For Final Design of Water Treatment Plant Upgrade Project And Approving the Final Design November 3, 2004 Page 2 When it withdrew approval, the City Council indicated that it would reconsider the treatment plant upgrades when pending environmental documents relating to development within the Brush Street Triangle and an amendment to the City's water permit were completed. To date, neither of these environmental documents has been approved. The Brush Street Triangle environmental report won't be presented to the City Council for approval until December or possibly January 2005. Staff believes it will be the end of the second quarter of 2005 before the environmental document for the amendment to the City's water permit is completed. In recent design meetings with SPH Associates, it was brought to staff's attention that DHS regulations now require the City water treatment plant to include, among others," . . the following reliability features: standby replacement equipment available to assure continuous operation and control of unit processes for coagulation, filtration and disinfection ... [and] multiple filter units which provide redundant capacity when filters are out of service for backwash or maintenance." (22 California Code of Regulations ("CCR") §64659). The nameplate (nominal) capacity of each existing treatment unit is 3 mgd or 6 mgd for both. Alan Jamison, Water Treatment Plant Supervisor, has estimated the actual capacity for both units between 5.1 to 5.5 mgd, subtracting for filter backwash and clarifier flushing. As the turbidity of the raw water increases, the backwash and flush frequency increases which reduces the actual capacity. The only source of raw water to the treatment units is from the Ranney collector. As shown below in Figure 1, Ranney raw water peak production since 1998 has been at or close to the filtration capacity of the existing two treatment units. Both of the existing treatment units are needed to treat the normal production amount of raw water from the Ranney collector. Th_ge two existinq treatment units alone do not meet the minimum requirements of 22 CCR §64659. A third treatment unit is needed to meet the redundancy regulation. STAFF RECOMMENDATION To bring the treatment plant into compliance with DHS regulations as soon as possible, staff is recommending a reduction in the scope of the original water treatment plant upgrade project from two new treatment units to one. One additional treatment unit will not increase the amount of water available for new development within the City's sphere of influence because as shown in Figure 1, since 1998 the peak Ranney production has not exceeded the filtration capacity. This additional treatment unit is needed to provide redundant capacity when one of the two existing treatment units is out of service, as required by DHS regulations. Adoption of Resolution Finding Negative Declaration Certified On MARCH 3, 2004, Adequate For Final Design of Water Treatment Plant Upgrade Project And Approving the Final Design November 3, 2004 Page 3 Figure 1 - Peak Ranney Production ¢. 1 6r RECOMMENDED PROJECT The water treatment plant improvements required to bring the treatment plant into compliance with State of California Public Health Standards and provide a safe and reliable water supply to residents of Ukiah have been defined in detail in the Predesign Report submitted by SPH Associates. These improvements are regarded to be the minimum to achieve the stated goals. The recommended project will consist of the following new facilities: 1. Treatment Plant · One, 2,800 gpm raw water pump · Rebuild two existing raw water pumps · One, 3 mgd capacity Trident modular treatment unit · New filtered water transfer pumps · Chlorine gas containment system improvements · Building addition with laboratory · SCADA based control and instrumentation improvements Adoption of Resolution Finding Negative Declaration Certified On MARCH 3, 2004, Adequate For Final Design of Water Treatment Plant Upgrade Project And Approving the Final Design November 3, 2004 Page 4 · Potassium permanganate raw water feed system · New clarified backwash water return pump · Numerous plant chemical and electrical facility improvements 2. High Service Pump Station · Three 350 Hp, 2,800 gpm finished water pumps · Pre-engineered 1,950 square foot building · 1,200 kw standby generator · Supporting mechanical, electrical and control features PROJECTED PROJECT COSTS The expected total project cost of upgrading the treatment facilities and constructing the high service pump station is $5,013,000. The project cost estimate presumes the additional facilities and improvements will be constructed under one, 12-month project contract. IMPLEMENTATION SCHEDULE Complete Design Documents Request for Bids Award Construction Contract Complete Construction December 13, 2004 January 3, 2005 February 16, 2005 March 1, 2006 RESOLUTION NO. 2005- Affachrnenf RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH FINDING NEGATIVE DECLARATION CERTIFIED ON MARCH 3, 2004 ADEQUATE FOR FINAL DESIGN OF WATER TREATMENT PLANT UPGRADE PROJECT AND APPROVING THE FINAL DESIGN FOR SAID PLANT WHEREAS' 1. On March 3, 2004, the City Council adopted a mitigated negative declaration ("Mitigated Negative Declaration"), mitigation monitoring program, approved SPH Associates' design recommendation for the water system improvement project (the "Project") and authorized proceeding with final design of the Project; and 2. As originally proposed, the Project consisted of constructing additional water storage tanks to increase the City's water storage capacity by 3.3 million gallons, installing two additional treatment modules in the City's water treatment plant, each module capable of treating up to 3 million gallons per day (MGD), installing additional and rebuilding pumps, and other associated improvements (the "Project"), all as more particularly described in the Agenda Summary Reports, which description is incorporated herein by reference; and 3. On March 17, 2004, the City Council adopted findings to support and explain its certification of the Negative Declaration; and 4. In its March 17, 2004 resolution the City Council found that the City could approve the final design without consideration of the growth inducing impacts in the City's sphere of influence of additional treatment capacity in its water treatment plant, because the changes to the plant were required to meet Department of Health Services ("DHS") regulations for the existing plant and because additional treatment capacity could have growth inducing effects only if the City developed additional water source capacity and its ability to do that was speculative at the time of that decision; and 5. Between March 17, 2004 and April 7, 2004, the City Council was presented with additional information concerning possible sources for additional water, which provided more detail as to the possible sources of new water, which made those details somewhat less speculative. In addition, the City was required by the Local Agency Formation Commission ("LAFCO") to indicate that the City had sufficient water supply and treatment capacity to serve a Iow income housing project located outside the City limits within its sphere of influence; and 6. Based on this additional information, on April 7, 2004, the City Council withdrew its approval for the final design of the portion of the water treatment plant upgrade project involving the installation of the two additional treatment modules and additional pumps, and other associated improvements; and 7. When it withdrew that approval, the City Council indicated that it would reconsider the full Project when pending environmental documents relating to development within the Brush Street Triangle and increased pumping from the Russian River were completed; and 8. Subsequent to the above-described events, the City has learned that DHS regulations require the City water treatment plant to include, among others, "... the following reliability features' · standby replacement equipment available to assure continuous operation and control of unit processes for coagulation, filtration and disinfection... [and] multiple filter units which provide redundant capacity when filters are out of service for backwash or maintenance." (22 California Code of Regulations ("CCR") §64659. Emphasis added.); and Resolution No. 2005- Page 1 of 2 9. The City's maximum day demand, which has occurred during the peak water demand period in the summer, is currently 7.8 MGD and the maximum treatment capacity of the two existing treatment modules at its water treatment plant is less than 6 MGD; and 10. The two treatment modules do not meet the minimum requirements of 22 CCR §64659; and 11. In order to bring the treatment plant into compliance with DHS regulations the City has determined to reduce the water treatment plant upgrade project from two additional treatment modules to one additional treatment module which would increase the maximum treatment capacity to less than 9 MGD; and 12. The addition of one additional treatment module will not make additional water available for new development within the City's sphere of influence, because one module will provide the redundant capacity when filters are out of service, as required by DHS regulations, will provide the ability to treat water during the brief periods when the City achieves maximum day demand, and will not make significant additional water available for new development. NOW, THEREFORE, BE IT RESOLVED as follows: 1. The City Council finds that the Mitigated Negative Declaration certified on March 3, 2004, is adequate and complete and fairly evaluates the environmental impacts of the revised final design for the water treatment plant upgrade project which includes one rather than two additional water treatment modules. 2. Based on the above recitals, the City Council finds that the revised final design, reducing the number of additional treatment modules from two to one does not represent a change in the Project that warrants or requires any subsequent or supplemental environmental review. The revised project eliminates any possible growth inducing impact. 3. The City Council reaffirms its commitment to and readopts the mitigations and the Mitigation Monitoring Plan adopted on March 3, 2004. 4. The City Council hereby approves the revised final design for the water treatment plant upgrade project and authorizes City staff to procure final bid documents and to solicit bids for said project. PASSED AND ADOPTED on November 3, 2004, by the following roll call vote' AYES: NOES: ABSENT: ABSTAIN: ATTEST: Eric Larson, Mayor Marie Ulvila, Deputy City Clerk Resolution No. 2005- Page 2 of 2 64659 Attachment BARCLAYS CALIFORNIA CODE OF REGULATIONS Title 22 § 64659. Reliability. (a) The following reliabilily features shall be included in the design and construction of all new, and existin~surface water trt~atment plants: (1') Alarm devices to provide warning of coagulation, filtration, and disinfection failures. All devices shall warn a person designated by the supplier as responsible for taking corrective action, or have provisions shul lhe planl down until corrective action can be taken. (2) Slandby replacement equipment available to assure coniJnuous op- eration and control of trail processes for coagulation, filtration and disin- fection. (3) A contJlluous turbidity monitoring and recording unil on the com- bined fiber effluent prior Io clcarwell stora,ze. (4) Multiple filter units which provide red~undanl capacity when filters arc out of service for backwash or maintenance. (b) Alternatives to the requirements specified in section 64659(a) shhl~ bc accepted provided the water supplier demonstrates lo the satisfaction of the Department that Ihe proposed alternative will assure an equal de- gree of reliability. NOTE: '. Authority c~tcd: Sections 208 and 4023.3. Health and Safety Code. Refer- ence: Sections 4010. 401 t). 1.4011.4012.4013, 4014.4016.4023.1. 4023.3.4024. 4025. 4026.4. 4031 and 4039, Health and Safety Code. HISTORY I. New section filed 5-6-91' operative (~-5-91 (Rcgisler 91, No. 25). Article 5. Operation § 64660. Operating Criteria. (a) All treatment plants utilizing an approved surface water shall be operated by operators certified bv the Department in accordance with Health and Safely Code section 106885. (b) Filtration facilities shall be operated in accordance with the follow- lng requirements ( I ) Conventional and direct filtration plants shall be operated at flow rates not to exceed 3.0 gallons per minute per square fool (gpm/sq. ft.) for simple media filters and 6.0 gpm/sq, ft. for deep bed, dual or mixed media filters under gravity flow conditions. For pressure filters, filtration rates shall not exceed 2.0 gprn/sq, ft. for simple media filters and 3.0 gpm/ sq. ft. for dual. mixed media, or deep bed filters. (2) Slow sand filters shall be operated at filtration rates not to exceed 0.10 gallon per rhinute per square Ibm. The filter bed shall not be dewa- tered except for cleaning and maintenance purposes. (3) Diatomaceous earth filters shall be operated at filtration rates not to exceed 1.0 gallon per minute per square foot. (4) In order to obtain approval for filtration rates higher than, but not more than twice, those specified in section 64660(b)(1), (b)(2), and (b)(3), a water supplier shall demonstrate to the Department that the fil- ters can comply with the performance requirements of section 64653. (5) In order to obtain approval for filtration rates greater than twice those specified in paragraphs (b)(1), (b)(2L and (b)(3), a water supplier shall demonstrate to the Department that the filters do the following: (A) Provide a minimum of 99 percent Giardia cyst removal and 90 percent virus removal: and (B) Meet the turbidity performance standards established in section 64653(c). (6) Filtration rates shall be increased gradually when placing filters back into service following backwashing or any other interruption in the operation of the filter. (7) When any individual filter in a conventional or direct filtration plant is placed back into service following backwashing or other inter- ruption event, the filtered water turbidity of the effluent from that filter shall not exceed any of the following: (A) 2.0 NTU at any time during the first four hours of filter operation following all interruption events. (B) 1.0 NTU at any time during the first four hours of filter operation following al least 90 percent of the interruption events durino any consec- utive 12 month period. ' ~ (C) 0.5 NTU at the time that the filter has been in operation for 4 hours. (8) Pressure filters shall be physically inspected and evaluated annual- ly for such factors as media condition, mudball formation, and shorl cir- cuiting. A written record of the inspection shall be maintained at the treat- merit plant. (9) Coagulation and llocculation unit processes shall bc in use at all limes durino which conventional and direct filtration treatment plants are iii operation. The effectiveness of these processes shall be demonstrated by eilhcr at least an 80 percent reduction through lhe Iiltcrs ol'thc inonthly avera{,e raw water turbidity or jar testing, pilol leslin~ or other means It) demonstrate that optimurn coagulation is being achieved. (10) The filtered water turbidity level from each filter unil shall be monitored with a continuous lurbidily meter and recorder, or with a grab sarnpling program designed to identify compliance with the requireme- cnts of paragraph (b)(7) and approved by the Department. If this monitor- lng indicates that any filter unit in a conventional or direct filtration plant is not performing as required in paragraph (b)(7), the filter shall bc taken out of service and inspected to determine the cause of its inadequate per- formance. The filter unit shall not be returned to service until deficiencies have been corrected and operations lests demonstrate that the filter unit is meeting the requirements of paragraph (b)(7). (c) Disinfection facilities shall be operated in accordance with the fol- lowing requirelnents: ( l ) A supply of chemicals necessary to provide continuous operation of disinfection facilities shall be maintained as a reserve or demonstrated to be available. (2) An emergency plan shall be developed prior to initiating operation of the disinfection facilities. The plan shall be implemented in the event of disinfection failure to prevent delivery to the distribution system of any undisinfected or inadequately disinfected water. The plan shall be posted in the treatment plant or other place readily accessible to the plant operator. NOTE: Authority cited: Sections 100275 and 116375. Health and Safety Code. Reference: Sections 116270, 116275. 116365. 116375.116385.116390. 1164(X). ! 16460. 116525, 116530. 116535. 116540. 116550. 116555. 116625. 116735 and 106885, Health and Safety Code. HISTORY I. New section filed 5-6-91; operative 6-5-91 (Register 91. No. 25). · 2. Amendment of section and NOTE filed 6-8-98: operative 7-8-98 (Re~ister 98. No. 24). § 64661. Operations Plan. (a) With a permit application for a new treatment plant, suppliers shall submit for Department review and approval an operations plan for each treatment plant that treats an approved surface water. The Department shall review the operations plan to determine if it includes those items re- quired in subsection (b). The operations plan shall be designed to produce the optimal water quality from the treatment process. The supplier shall operate its treatment plant in accordance with the approved plan. (b) The operations plan shall consist of a description of the utility's treatment plant performance monitoring program, unit process equip- ment maintenance program, operating personnel, including numbers of staff, certification levels and responsibilities: how and when each unit process is operated: laboratory procedures: procedures used to determine chemical dose rates; records: response to plant and watershed ernergen- cies; and reliability features. NOTE: Authority cited: Sections 100275 and 116375. Health and Safety Code. Reference: Secti})ns 116270, 116275. 116365. 116375j 116385. 116390. 116400. 116450. 116460, 116525.116530. 116535. 116540. 116550, 116555.116625 and 116735, Health and Safety Code. HISTORY 1. New section filed 5-6-91- operative 6-5-91 (Register 91. No. 25). 2. Amend~nent of subsection (a) and NOTE filed 6-8-98: operative 7-8-98 (Re~,is- ter 98, No. 24). ~ · Page 622.6 Register 98, No. 24; 6-12-98 I I I I (pI~LU) UO !],onpoJd Ja),eM t'o0g ~00~ ~00~ tO0g 000~ ~66t }ocument View Frame Page Page 1 of California Code of Regulations TIlL_E_22. So_cial Se__cH_ri_ty Division 4. Environmental Health Chapter 17. Surface Water Treatment Article 4. Desigp_Sta nda rds §64659. Reliability~. {}64659. Reliability. ~ · _N. ple · Hi.story (a) The following reliability features shall be included in the design and construction of all new and existing surface water treatment plants: (1) Alarm devices to provide warning of coagulation, filtration, and disinfection failures. All devices shall warn a person designated by the supplier as responsible for taking corrective action, or have provisions to shut the plant down until corrective action can be taken. (2) Standby replacement equipment available to assure continuous operation and control of unit processes for coagulation, filtration and disinfection. (3) A continuous turbidity monitoring and recording unit on the combined filter effluent prior to clearwell storage. (4) Multiple filter units which provide redundant capacity when filters are out of service for backwash or maintenance. (b) Alternatives to the requirements specified in section 64659(a) shall be accepted provided the water supplier demonstrates to the satisfaction of the D~l~a~ment-~h~tt the proposed alternative will assure an equal degree of reliability. N ()'1't'i Authority cited: Sections 208 and 4023.3, Health and Safety Code. Reference: Sections 4010, 4010.1, 4011, 4012, 4013, 4014, 4016, 4023.1, 4023.3, 4024, 4025, 4026.4, 4031 and 4039, Health and Safety Code. l{lx I'()RY 1. New section filed 5-6-91; operative 6-5-91 (Register 91, No. 25). Article 5. Operation §64660. Operating Criteria. ~ · No;re · History (a) All treatment plants utilizing an approved surface water shall be operated by operators certified by the .... r" Rank this query? I1. q~r~h ~,.~,~.-;F~.,~W II Records: ~ ~1~1,,1~1 I1' Search Recent ttp://ccr.~a~.ca.g~v/cgi-bin/~m-isapi.d~~?c~ientID=84988&E22=&E23=64659&E24=&inf~base=ccr&queryt... 10/28/0 AGENDA SUMMARY REPORT ITEM NO: loc DATE' November 3, 2004 SUBJECT: ADOPTION OF RESOLUTION APPROVING SINGLE MEMBER SERVICES AGREEMENT AND MASTER CONFIRMATION AGREEMENT, AUTHORIZING CITY MANAGER TO SIGN SAME AND AUTHORIZING CITY MANAGER/PUBLIC UTILITIES DIRECTOR TO APPROVE VARIOUS TRANSACTIONS TO PURCHASE ENERGY AS NEEDED At the City Council meeting of October 20, 2004, approval was given to the City Manager and the Public Utilities Director to purchase the necessary energy requirement for the City as a result of the loss of the Western energy contract on December 31, 2004. In order to go forward with the purchase(s), City Council must approve a Member Services Agreement and Master Confirmation Agreement with Northern California Power Agency (NCPA). The approval is in the form of a Resolution directing the future energy purchase transactions. Staff recommends approval of the Resolution as written. RECOMMENDED ACTION' Adopt Resolution Approving Single Member Services Agreement And Master Confirmation Agreement, Authorizing City Manager To Sign Same And Authorizing City Manager/Public Utilities Director To Approve Various Transactions To Purchase Energy As Needed ALTERNATIVE COUNCIL POLICY OPTIONS' Provide Other Direction to Staff. Citizens Advised' Requested by: Prepared by: Coordinated with: Attachments: N/A Bernie Ziemianek, Public Utilities Director Bernie Ziemianek, Public Utilities Director Candace Horsley, City Manager & David Rapport, City Attorney Resolution for Adoption Approved' Candace Horsley, City rv~.ager RESOLUTION NO. 2005- RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING SINGLE MEMBER SERVICES AGREEMENT AND MASTER CONFIRMATION AGREEMENT, AUTHORIZING CITY MANAGER TO SIGN SAME AND AUTHORIZING CITY MANAGER/PUBLIC UTILITIES DIRECTOR TO APPROVE VARIOUS TRANSACTIONS TO PURCHASE ENERGY AS NEEDED WHEREAS: 1. The City of Ukiah's right to purchase from the Western Area Power Administration (WAPA) a certain portion of the electricity required by its Electric Utility has terminated; and 2. The City must purchase electricity from other sources to make up for the loss of the electricity formerly purchased from WAPA; and 3. The City lacks the personnel and resources to negotiate, purchase and administer contracts for this replacement electricity; and 4. The City belongs to the Northern California Power Agency (NCPA), which is a joint exercise of powers agency that operates various electrical power generating facilities for its member agencies, including the City; and 5. NCPA has the staff and resources to negotiate, purchase and administer contracts for the purchase of electricity on the City's behalf and performs this service for other individual member agencies of NCPA; and 6. NCPA is willing to provide these services provided that it has no separate liability for these transactions and it has the same liability as would be the case, if NCPA were performing these services as employees of the City; and 7. Currently, the price for electrical energy and capacity is fluctuating significantly over very short time periods due to dramatic and frequent changes in the cost of oil and natural gas; and 8. During the next one year period, the City must make multiple purchasing decisions on a very short time frame in order to keep its electrical energy costs as Iow as possible in this volatile market; and 9. NCPA has developed modifications to the standard Master Confirmation Agreement used by sellers of electricity which it believes better protects its members in the event a seller files for bankruptcy and NCPA recommends the use of these modifications, whenever possible; and Resolution No. 2005- Page 1 of 2 10. The risks associated with contracting with NCPA, entering Master Confirmation Agreements, modified or unmodified, delegating authority to the City Manager/Director of Public Utilities as authorized by this Resolution, and purchasing electricity in a volatile market have been explained to and considered by the City Council; and 11. To purchase the replacement electricity required by its Electric Utility under the circumstances described in these recitals, the City Council of the City of Ukiah determines that it is in the best interest of the City and its residents to approve the Single Member Services Agreement, attached hereto as Exhibit A, the Master Confirmation Agreement (Western Systems Power Pool Agreement), attached hereto as Exhibit B, to authorize the City Manager to sign the Single Member Services Agreement, and to authorize the City Manager and the Director of Public Utilities to approve electrical purchase transactions pursuant to the agreements contained in Exhibits A, B, and C and to take any other actions and sign other documents which shall become binding on the City, as necessary, to purchase additional electricity. NOW, THEREFORE, BE IT RESOLVED as follows: 1. The agreements attached hereto as Exhibits A, B, and C are hereby approved and the City Manager is authorized to sign them on behalf of the City. 2. The City Manager and the Director of Public Utilities are hereby authorized to approve the purchase of electricity by NCPA on the City's behalf pursuant to Exhibit A and to approve Master Confirmation Agreements with counter-parties, using the Master Confirmation Agreement modifications attached hereto as Exhibit B as modified by Exhibit C, whenever possible and without said modifications, where necessary in the judgment of the City Manager and Director of Public Utilities upon the advice of NCPA. 3. The City Manager and the Director of Public Utilities are authorized to take such further action and sign such additional documents as may be necessary to consummate the purchase of electricity as provided herein and such actions shall be binding on the City without further action by the City Council. 4. The Director of Public Utilities shall provide the City Council with periodic reports, not less often than every three months, detailing the transactions undertaken pursuant to this resolution and shall agendize this resolution for periodic review by the City Council not less often than every six months. PASSED AND ADOPTED on November 3, 2004, by the following roll call vote. AYES: NOES: ABSENT: ABSTAIN: Eric Larson, Mayor ATTEST: Marie Ulvila, City Clerk Resolution No. 2005- Page 2 of 2 EXHIBIT A SINGLE MEMBER SERVICES AGREEMENT FOR SPECIAL TRANSACTIONS BY AND BETWEEN THE CITY OF UKIAH AND THE NORTHERN CALIFORNIA POWER AGENCY This Single Member Services Agreement for Special Transactions (the Agreement) is entered into as of the 3RO day of November, 2004 (Effective Date), by and between the Northern California Power Agency, a California joint powers and public entity having its central office at 180 Cirby Way, Roseville, California 95678 (NCPA), and the City of Ukiah, California, a general law California municipal corporation, having its central office at Ukiah Civic Center, 300 Seminary Ave., Ukiah, California 95482. NCPA and the Member are occasionally herein referred to individually as a "Party" or collectively the "Parties." This Agreement is premised on the following RECITALS: WHEREAS, NCPA provides, among other services to its membership: electric generation facility development and power resource pooling services to the majority of its member public entities and an associate nonprofit member, SMSA 10/28/03 and technical, operational, and maintenance services on behalf of the majority of member and associate member entities, for the operation and maintenance of NCPA electric generating projects in which they are invested, as well as dispatch, scheduling coordination, trading and risk management services, so that the members of NCPA on the whole, exercising their common powers pursuant to the Joint Exercise of Powers Act, may supply electrical power and energy for their residential, commercial, and industrial customers on a reliable, cost- effective, and environmentally sensitive basis, with the advantages of the economy of scale, which may, under some circumstances, benefit all of NCPA's members; and WHEREAS, the Member, as a member of NCPA, while it looks to NCPA in part for the services described above, it nevertheless wishes to request that NCPA provide special services, in the nature of an advisor or agent, by which the Member may advantage its customers by avoiding the cost of the embedded expertise that it would have to employ in the absence of NCPA, and the risks associated therewith, so that the Member may, at its sole risk, and without hazard to NCPA and its other members, deliver local benefits to the Member's customers, when other NCPA members may not share interests in this Member's particular effort; and WHEREAS, this Agreement has been drawn to first protect NCPA and its members from any exposure to liability of any kind that might result from any DWD V. 1 SMSA 12/3/03 act or omission in the performance of this Agreement, to the fullest extent permitted by law, due to the fact that NCPA will be acting for the Member and not for any other member in its performance of this Agreement and due to the further fact that the benefit of this Agreement to the other members is limited to the extent to which the challenges of this Agreement develop in NCPA further skill and expertise, but not to any economic or financial benefit for which those members should be liable; and WHEREAS, the Member desires to utilize the benefits of the investment in, and expertise available through the auspices of NCPA, and NCPA having weighed the consideration herein, and the protection the Member intends to provide NCPA and its other members in this Agreement, wishes to assist the Member; NOW, THEREFORE, in consideration of the premises and the mutual covenants and conditions set forth herein, the Parties have entered into this AGREEMENT: ARTICLE 1 - SCOPE OF SERVICES Upon mutual agreement, and subject to the General Conditions described below, NCPA will provide to the Member Advisory Services, Agency Services, and Pooled Subscription Services (Services), for Power Transactions (collectively Transactions). DWD V. 1 SMSA 12/3/03 1.1 1.2 General Conditions. NCPA shall not be obligated under this Agreement to provide any Services to, or undertake any Transactions for, the Member, notwithstanding that fact that the Member may have completely and faithfully complied with each and every term, condition, and covenant of this Agreement. NCPA may decline to furnish any Service or Transaction requested by the Member in the sole and absolute discretion of NCPA, acting by and through its Commission without the vote of the Member, and such discretion of the Commission shall not be subject to review or to the dispute resolution provisions of this Agreement or of other agreements between the Member and NCPA; provided, however, that should NCPA have agreed in a written Confirmation to provide any Service to or undertake any Transaction for the Member; provided that the Member is then at the time of the Confirmation not in default of, and has completely and faithfully complied with each and every term, condition, and covenant of this Agreement, then NCPA shall provide such Service or undertake such Transaction. Power Transactions. Power Transactions mean electrical power, and electrical capacity, energy, exchange, and ancillary services, or high voltage electric transmission transactions, with parties that are not members of NCPA for the purpose of serving the Member and its consumers. Power Transactions would benefit and affect the Member, and DWD V. 1 SMSA 12/3/03 not be of interest to, or practicably capable of execution through the NCPA Pooling Agreement or the NCPA Facilities Agreement, and are not subject to a right of refusal. 1.3 Advisory Services. Advisory Services mean technical, economic, financial, legal, risk and credit analysis, and other advice of a professional nature, related to the potential or ongoing Services that NCPA may provide the Member under this Agreement, on a fiat monthly retainer basis, for the costs directly associated with this Agreement, shown initially on Attachment A to this Agreement. Advisory Services also include such services provided by NCPA on an hourly fee basis for potential and ongoing Transactions and Agency Services, that will recover for NCPA all of its costs to protect the other NCPA members. NCPA may adjust the monthly retainer and hourly fees as it determines may be required, in its sole discretion, during the preparation and adoption of the NCPA Annual Budget. 1.4 Agency Services. Agency Service mean services that NCPA may provide in the capacity of the exclusive agent of the Member, as principal, subject to the General Conditions of this Agreement, to execute and perform Transactions, on an hourly fee basis, that will recover for NCPA all of its costs to protect the other NCPA members. DWD V. 1 SMSA 12/3/03 1.5 Pooled Subscription Services. Pooled Subscription Services mean services that NCPA may provide the Member and other members of NCPA as an Advisory Service and an Agency Service, where the Member and at least another member of NCPA (Cooperating Member) has executed a duplicate of this Agreement. Pooled Subscription Services include Power Transactions, Gas Transactions, or Financial Transactions that would benefit and affect the Member and the Cooperating Member or Members, and not be of interest to other NCPA members, or practicably capable of execution through the NCPA Pooling Agreement or the Third Phase Agreements for other NCPA projects, and that are not subject to a right of refusal. ARTICLE 2 - REQUEST FOR SERVICES 2.1 Member Request. After the Effective Date, NCPA shall provide the Member with Advisory Services in consideration of the payment of the monthly retainer. Upon receipt of a written request for Advisory Services with respect to potential Transactions and Agency Services, NCPA will respond to the Member, subject to the General Conditions, with a proposal for fee-based Advisory Services related to the requested potential Transactions or Agency Services, including the number and identity of NCPA personnel, by job classifications, the man-hour estimates, all special programs and services, such as national price DWD V. 1 SMSA 12/3/03 reporting services, all materials and equipment, all other pertinent information, such as required outside support, a schedule and an estimate of costs, that would be components of the fee for the fee-based Advisory Services. 2.2 NCPA Costs of Response. Before responding, NCPA shall estimate and provide to the Member the estimate, of NCPA's expected costs for responding to the Member Request, and the Member shall advance such estimated costs, before NCPA provides its response subject to the General Conditions. NCPA will not respond if it does not receive the advance within twenty days of the date of NCPA's estimate. NCPA will not be liable to the Member if NCPA, after consuming all or a part of the advance of estimated costs, declines to respond to, or suggests alternatives to the Member Request, in NCPA's discretion, exercised under the General Conditions. 2.3 Mutual Agreement on Scope of Services. If after the payment or tender of payment for all of the actual costs to NCPA of responding to the Member Request, the Member and NCPA agree to the Services that NCPA should provide, NCPA and the Member shall execute and deliver a Confirmation of the Transactions and Services, including Advisory and DWD V. 1 SMSA 12/3/03 Agency Services, that NCPA will provide, if and as requested by the Member. 2.4 Authentication of Delegation. Before responding to any Member Request, and again prior to confirming any Services or Transactions, NCPA is entitled to require an authentication of the delegation of any authority of the governing body of the Member to a manager of the Member, by legal opinion, to confirm that the delegation is appropriate in all respects given the then current documents and the proposed Transactions and Services to be effected thereon. In addition, NCPA may require, as part of the General Conditions, that the Member delegate authority to NCPA before it undertakes to perform any Services or execute any Transaction on behalf of the Member, in form and substance acceptable to NCPA, in its sole discretion, as provided in the General Conditions. Any delegation of authority shall require at a minimum a resolution of the governing body of the Member acknowledging receipt and understanding of a Disclosure Statement and affirmatively delegating to the manager of the Member or to NCPA the authority required for the Transactions or Services. 2.5 Confirmations. No obligation as might be imposed by law on NCPA or its other members shall arise unless a written Confirmation accepting that obligation in respect to a Transaction or Service, described in detail in the DWD V. 1 SMSA 12/3/03 Confirmation, shall have been accepted by the Member without qualification, and approved by the NCPA Commission. A failure of a Disclosure Statement to describe a risk or effect of a Transaction or Service shall not excuse the Member from its liability therefor, given that the Member shall in all situations be wholly responsible for the Disclosure Statement. ARTICLE 3 - DUE DILIGENCE ARTICLE 4- REPRESENTATIONS AND WARRANTIES 4.1 Initial Representations and Warranties. On the Effective Date and the date of entering into each Transaction, the Member represents and warrants to NCPA that: (i) it is duly organized, validly exiting and in good standing under the laws of California and of the United States; (ii) it has all regulatory authorizations necessary for it to legally perform its obligations under this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement); (iii) the execution, delivery and performance of this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement) are within its powers, have been duly authorized by all necessary action and do not violate any of DWD V. 1 SMSA 12/3/03 the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it; (iv) this Agreement, each Transaction (including any Confirmation accepted in accordance with this Agreement), and each other document executed and delivered in accordance with this Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; subject to any Equitable Defenses. (v) it is not Bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming Bankrupt; (vi) there is not pending or, to its knowledge, threatened against it or any legal proceedings or investigations that could materially adversely affect its ability to perform its obligations under this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement); (vii) no Event of Default or Potential Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its 10 DWD V. 1 SMSA 12/3/03 obligations under this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement); (viii) it is acting for its own account, has made its own independent decision to enter into this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement) and as to whether this Agreement and each such Transaction (including any Confirmation accepted in accordance with this Agreement) is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of NCPA in providing Advisory Services, and the Member is capable of assessing the merits of and understanding, and understands and accepts, the terms, conditions and risks of this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement); (ix) it has entered into this Agreement and each Transaction (including any Confirmation accepted in accordance with this Agreement) in connection with the conduct of its public service utility enterprise and it has the capacity or ability to make or take delivery of all products referred to in any Transaction to which it is a party; 11 DWD V. 1 SMSA 12/3/03 4.2 Further Representations and Warranties. On the Effective Date and the date of entering into each Transaction, the Member further represents and warrants to NCPA that: (i) all acts necessary to the valid execution, delivery and performance of this Agreement, including without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures has or will be taken and performed as required under the laws of the State of California and the charter, ordinances, bylaws or other regulations, (ii) all persons making up the governing body of the Member are the duly elected or appointed incumbents in their positions and hold such positions in good standing in accordance with the state and local, and other applicable law, (iii) entry into and performance of this Agreement and each Transaction by the Member are for a proper public purpose within the meaning of all relevant constitutional, organic or other governing documents and applicable law, and (iv) the term of this Agreement does not extend beyond any applicable limitation imposed by the relevant constitutional, organic or other governing documents and applicable law, (v) the Member's obligations to make payments hereunder are 4.3 Primacy of NCPA Projects. Notwithstanding the availability of NCPA personnel and equipment the Member acknowledges and agrees that the first priority for NCPA personnel are the other NCPA projects in which 12 DWD V. 1 SMSA 12/3/03 more than one member participates, and that the Services and Transactions that NCPA provides under this Agreement are subordinate to NCPA's duties to serve the other members. ARTICLE 5 - APPROVED TRANSACTIONS 5.1 Preparation of Contract Form Risk Disclosure Statements. NCPA shall prepare a Risk Disclosure Statement to inform the Member's governing body of the risks involved in Contract Forms for which the Member requests approval. 5.2 Governing Body Adoption of Contract Damages Risk Limitations. Transactions shall be entered only after the Member's governing body has approved by a particular Transaction or category or class of Transactions after presentation of the Contract Damages Risk Assessment ARTICLE 6- PAYMENTS AND DEFAULTS 6.1 Billing and Payment. Monthly billing statements prepared by NCPA shall be sent to the Member showing the Member's unpaid balance for Transactions and Services and other expenses relating to this Agreement incurred by NCPA for the previous month. This information may be provided on monthly billing statements prepared by NCPA pursuant to other Project Agreements. NCPA will provide the monthly billing statements electronically if requested by the Member; otherwise NCPA. shall mail the statements First Class, U.S. Postal Service. 13 DWD V. 1 SMSA 12/3/03 6.2 Late Payments. Amounts shown on each billing statement are due and payable at the time noted on the invoice, but not later than thirty (30) days after the date of the invoice, except that any amount due on a Friday, holiday or weekend may be paid on the following working day. Any amount due and not paid by the Member shall bear interest imposed on NCPA by any Couterparty from whom NCPA has performed a Transacton on behalf of Member pursuant to this Agreement. 6.3 Settlement Data. NCPA will make settlement data, including underlying data received from a Counterparty, available to the Member. 6.4 Audit Rights. The Member shall have the right to audit at its expense any data created or maintained by NCPA pursuant to this Agreement or pursuant to a Transaction on thirty (30) days written notice, unless otherwise agreed by the Member and NCPA. 6.5 6.6 6.7 6.8 Failure To Pay. If the Member fails to pay any amount due to NCPA within thirty (30) days of the date of the estimated or final invoice enumerating such amounts, the Member is in default and material breach under this Agreement. Cure Period. Upon written notice by NCPA, the Member shall cure any default within five (5) working days. Cure of Defaults. A default shall be cured by the payment of any monies due NCPA, including any late payment charges. Remedies in the Event of a Material Default. NCPA may suspend the provision of any Agency Service or Advisory Service to the Member with 14 DWD V. 1 SMSA 12/3/03 6.9 a default which has not been cured within the Cure Period, demanding further assurances, and taking any other legal or equitable action after the Cure Period to compel the correction of the default, as for example, to mandate the collection of a surcharge to produce Revenues to secure the cure of the default, (and the selection of one remedy shall not preclude the use of other remedies), on behalf of NCPA and other Members (in which event the defaulting Member shall not have the right to vote while such defaulting Member is in material default as determined by the NCPA Commission). Obligations in the Event of Default. A defaulting Member shall cooperate in good faith with NCPA and shall cure the default as rapidly as possible, on an emergency basis, taking all such action as is necessary, including, but not limited to, raising, drawing on its cash-on-hand and lines of credit, obtaining further assurances by way of credit support and letters of credit, repairing its Electric System, and taking all such other action as will cure the default quickly; and provided, however, that neither NCPA nor any other member shall be liable under this Agreement for the obligations of the defaulting Member, and the Member shall be solely responsible and liable for performance of its obligations under this Agreement and each Transaction. 7.1 ARTICLE 7- TERM OF THIS AGREEMENT Term of This Agreement. The term of this Agreement will be ten (10) years from its Effective Date. Six (6) months prior to the fifth-year anniversary date, the Parties will meet to review the Agreement. During 15 DWD V. 1 SMSA 12/3/03 the review period and following good-faith negotiations to resolve outstanding issues, either Party may terminate the Agreement. Notwithstanding the foregoing, either Party may, at any time during the term of the Agreement, terminate this Agreement on a date ninety (90) days after delivery of a written notice of termination to the other Party. No termination shall become effective until the termination of all Transactions. ARTICLE 8 - NO IMMUNITY CLAIM 8.1 No Immunity Claim. The Member warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (i) suit, (ii) jurisdiction of a court (including a court located outside the jurisdiction of its organization), (iii) relief by way of injunction, order for specific performance or recovery of property, (iv) attachment of assets, or (v) execution or enforcement of any judgment. ARTICLE 9- MEMBER COVENANTS The definitions in this Article 9 apply to the covenants in section 10.3 and elsewhere in this Agreement. 9.1 Electric System. Electric System means, with respect to the Member, all properties and assets, real and personal, tangible and intangible, of the 16 DWD V. 1 SMSA 12/3/03 Member now or hereafter existing, used or pertaining to the generation, transmission, transformation, distribution and sale of electric capacity and energy, including all additions, extensions, expansions, improvements and betterments thereto and equipment thereof; provided, however, that to the extent the Member is not the sole owner of an asset or property or to the extent that an asset or property is used in part for the above described purposes, only the Member's ownership interest in such asset or property or only the part of the asset or property used for electric purposes shall be considered to be part of its Electric System. 9.2 Revenues. Revenues means, with respect to the Member, all income, rents, rates, fees, charges, and other moneys derived by the Member from the ownership or operation of its Electric System, including, without limiting the generality of the foregoing, (i) all income, rents, rates, fees, charges or other moneys derived from the sale, furnishing and supplying of electric capacity and energy and other services, facilities, and commodities sold, furnished, or supplied through the facilities of its Electric System, (ii) the earnings on and income derived from the investment of such income, rents, rates, fees, charges or other moneys to the extent that the use of such earnings and income is limited by or pursuant to law to its Electric System, and (iii) the proceeds derived by the Member directly or indirectly from the sale, lease or other disposition of 17 DWD V. 1 SMSA 12/3/03 all or a part of the Electric System, but the term Revenues shall not include (a) customers' deposits or any other deposits subject to refund until such deposits have become the property of the Member or (b) contributions from customers for the payment of costs of construction of facilities to serve them. 9.3 Member Covenants. The Member covenants and agrees to (i) establish and collect rates and charges for the services and commodities provided by its Electric System sufficient to provide Revenues adequate to meet its obligations under this Agreement and all Transactions combined and to pay all other amounts payable from, and all lawful charges against or liens upon, the Revenues; (ii) make payments under this Agreement from the Revenues of, and as an operating expense of, its Electric System; (iii) make payments under this Agreement whether or not there is an interruption in, interference with, or reduction or suspension of services provided under this Agreement and any transaction (such payments are not subject to any reduction, whether by offset or otherwise, and regardless of whether any dispute exists); and (iv) operate its Electric System and the business in connection therewith in an efficient manner and at reasonable cost and to maintain its Electric System in good repair, working order, and condition. 18 DWD V. 1 SMSA 12/3/03 ARTICLE 10 - DELEGATION OF MEMBER AUTHORITY 10.1. Delegation to Member Agent. The Member hereby designates as its authorized agent, the Member manager, to whom by resolution the Member has delegated its authority to execute on its behalf such forms of contracts as have been adopted by the Member pursuant to this Agreement for the use in Transactions subject to the Contract Damages Risk Limitation adopted by the Member's Governing Body. 10.2. Delegation to NCPA. The Member will delegate to NCPA all of the Member's governing body's authority to enter into a Transaction with the Member's resolution confirming an Agency Service for such Transaction. The Member shall not revoke such agency during the term of the Transaction. ARTICLE 11 - TRANSACTION LITIGATION 11.1 Transaction Litigation. In the event of litigation, dispute resolution, governmental inquiry, including investigations or legislative inquiries, relating to any matter involving this Agreement or any Service or Transaction, NCPA may select Counsel of its choice to advise and represent NCPA and the Member, and the Member shall pay NCPA for such expenses, as billed pursuant to this Agreement. 19 DWD V. 1 SMSA 12/3/03 ARTICLE 12- UNCONTROLLABLE CIRCUMSTANCES- SUSPENSION OF PERFORMANCE 12.1 Definition. In this Agreement "Uncontrollable Circumstances" shall mean acts, events or conditions not reasonably foreseeable by a Party which prevent the affected Party from performing its obligations under this Agreement, except the obligation for the payment of money, if and only if such acts, events or conditions and their effects (i) are beyond the reasonable control of such Party (or any third Party over whom such Party has control), (ii) are not reasonably avoidable, (iii) cannot be mitigated or eliminated through reasonably available alternative actions, and (iv) are not a result of the willful or negligent action or inaction of such Party or of any third Party over whom such Party has control: Examples of Uncontrollable Circumstances include, but are not limited to, the following: 12.1.1 An act of God, landslide, lightning, earthquake, fire, explosion, storm, flood, weather conditions precluding construction activity from progressing; 12.1.2 Acts of a public enemy, war, blockade, insurrection, strike, riot or civil disturbance, sabotage or similar occurrence or a mandate, directive, order, or restraint of any governmental, regulatory or judicial body or agency, or the exercise of the power of eminent 20 DWD V. 1 SMSA 12/3/03 domain, police power, inverse condemnation or other taking by or on behalf of any public, quasi-public or private entity; or 12.1.3 A Change in Law. In this Agreement, a Change in Law shall mean a material change in the requirements of the Scope of Services or the operation or maintenance of the Project, made by a governmental authority, that becomes effective on or after the date of this Agreement. 12.2 Suspension of Performance. The suspension of performance due to Uncontrollable Circumstances shall be no longer than reasonably required, and the Party suffering the Uncontrollable Circumstances shall use its best reasonable efforts to overcome such circumstances and partially or fully remedy its inability to perform. The Party suffering the Uncontrollable Circumstance shall give the other Party notice that is reasonable under such circumstances, including written notice as soon as practicable. ARTICLE 13- INDEMNIFICATION, DEFENSE, RELEASE, AND COVENANT NOT TO SUE 13.1 Indemnity Obligation of Member. The Member hereby assumes all responsibility and liability for the Transactions and Services provided under the Agreement as if they were performed by the Member's employees and accordingly intends to protect NCPA, its member entities, 21 DWD V. 1 SMSA 12/3/03 governing officials, officers, agents, and employees against claims or losses of any kind whatsoever resulting from Transactions and Services provided pursuant to this Agreement. The Member is willing to take on such complete responsibility as an inducement to NCPA to enter into this Agreement. NCPA would not enter into this Agreement absent such inducement for NCPA's sole source of revenue comes from its members, which cannot be exposed to the risks of loss or damage due to Transactions, Services, or this Agreement. Thus, the Member (the "Indemnifying Party") agrees to indemnify, defend and hold harmless NCPA and its members, including their respective governing officials, officers, agents, and employees ("Indenmified Party or Parties"), from and against any and all claims, suits, losses, damages, expenses and liability of any kind or nature, including, without limitation, reasonable attorneys' fees ("Claim" or collectively "Claims") to the extent caused by any breach of contract, negligence, active or passive, gross negligence or willful misconduct of the Indemnifying Party, its officers, employees, subcontractors or agents, to the maximum extent permitted by law, but only as to Claims related to this Agreement. 13.2 Notice and Defense. Promptly after receipt by an Indemnified Party of any Claim or notice of a Claim or the commencement of any action or administrative or legal proceeding or investigation as to which the 22 DWD V. 1 SMSA 12/3/03 indemnity provided for in section 14.1 may apply, the Indemnified Party shall notify the Indemnifying Party of such fact. The Indemnifying Party shall have the right to assume the defense thereof with counsel designated by the Indemnifying Party and satisfactory to the Indemnified Party; provided, however, that if the defendants in any such action include both the Indenmified Party and the Indemnifying Party, and the Indemnified Party shall have reasonably concluded that there may be legal defenses available to it and/or other Indemnified Parties which are different from or additional to those available to the Indemnifying Party, the Indemnified Party or Parties shall, at the expense of the Indenmifying Party, have the right to select separate counsel to assert such legal defenses and to otherwise participate in the defense of such action on behalf of such Indemnified Party or Parties. 13.3 Failure to Assume Defense. Should any of the Indemnified Parties be entitled to indemnification under section 14.1 as a result of a Claim by a third Party, and should the Indemnifying Party fail to assume the defense of such Claim after reviewing notification thereof as provided in section 14.2, then such Indemnified Party may, at the expense of the Indemnifying Party, contest or settle such Claim. To the extent that any of the Indemnified Parties is required to initiate and prevails in legal proceedings against the Indemnifying Party to enforce rights under this 23 DWD V. 1 SMSA 12/3/03 Article, the Indemnifying Party shall pay all costs and attorneys' fees incurred by the Indemnified Party in enforcing its rights. 13.4 Release and Covenant Not to Sue. The Member hereby FOREVER RELEASES and DISCHARGES NCPA, its members, governing officials, officers, agents, employees, and subcontractors (Released Parties) from any and all liabilities, claims, demands or causes of action that the Member may hereafter have for injuries, damages, or losses of any kind whatsoever arising out of the Transactions, Services or this Agreement performed or not performed, or inadequately performed by NCPA, including, but not limited to, losses caused by the PASSIVE OR ACTIVE NEGLIGENCE of the Released Parties or hidden, latent, or obvious defects in equipment or materials used, but excluding gross negligence or willfully wrongful acts or omissions. The Member understands and acknowledges that the Project and the Services have inherent dangers that no amount of care, caution, instruction or expertise can eliminate and the Member expressly and voluntarily ASSUMES ALL RISK of death, personal injury, damages or losses of any kind whatsoever sustained in connection with the Project and the Services, including the risk of passive or active negligence of the Released Parties, or hidden, latent, or obvious defects in the materials used. 24 DWD V. 1 SMSA 12/3/03 The Member acknowledges the enforceability of the foregoing release under Paralift, Inc. v. Superior Court (1993) 23 Cal. App.4th 748 (Paralift Case). The Member hereby FOREVER COVENANTS NOT TO SUE the Released Parties for any injuries, damages, or losses, or liabilities, claims, demands or causes of action related thereto, to which the foregoing release applies, even if the Paralift Case is overruled or affected by a judicial decision or legislation, state or federal, or by an international treaty. ARTICLE 14- GENERAL PROVISIONS 14.1 Independent Contractor. NCPA shall be an independent contractor with respect to the Services to be performed hereunder. Neither NCPA nor its subcontractors, nor their agents or employees, shall be deemed to be the servants, employees, or agents of the Member, notwithstanding Article 14. 14.2 Occupational Safety and Health Act. The Member shall design, equip, and maintain and operate its Election System in accordance with all applicable rules, regulations, orders, standards and interpretations promulgated under the Occupational Safety and Health Act (1970) (OSHA), as amended and in effect as of the day of execution of this Agreement or such similar act as adopted by the State of California, if applicable. 25 DWD V. 1 SMSA 12/3/03 14.3 Proprietary Information. To the extent permitted by law, in particular the California Public Records Act, the Parties shall maintain the confidentiality of proprietary information. 14.4 Patents. The Member shall defend, indemnify and hold harmless NCPA from any suit or action brought against NCPA based on a claim that any item of the Project, or materials and equipment procured therefor, or any part thereof, furnished or specified by NCPA or the Member hereunder or any use thereof for purposes of the Project, constitutes an infringement of any claim of patent, unless NCPA recommended such item, materials or equipment with prior knowledge of the patent infringement and failed to disclose such information to the Member. 14.5 Binding Effect: Successors and Assigns. 14.5.1 This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assignees. 14.5.2 Neither Party hereto shall assign or convey any of its rights, titles or interests under this Agreement without the prior written consent of the other Party hereto. 14.6 Not for Benefit of Third Parties. This Agreement and each and every provision thereof is for the exclusive benefit of the Parties hereto and not for the benefit of any other party except that the other member entities are 26 DWD V. 1 SMSA 12/3/03 intended to benefit from the protections provided them in this Agreement in Article 13. 14.7 Choice of Law. This Agreement is made and is to be performed in California and any dispute arising therefrom shall be governed and interpreted in accordance with California laws. 14.8 Article Headings and Subheadings. All article headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement. 14.9 No Waiver. No waiver by a Party of any breach or default by the other Party of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach of default in the performance by such other Party of the same or any other obligations of such other Party hereunder. The giving of a waiver by a Party in any one instance shall not limit or waive the necessity to obtain such Party's waiver in any future instance. No waiver of any rights under this Agreement shall be binding unless it is in writing signed by the Party waiving such rights. 14.10 Good Faith and Fair Dealing. The Parties agree to deal fairly and to act in good faith in the performance or enforcement of this Agreement. Wherever this Agreement requires a consent or approval of a Party hereto, such consent or approval shall not be unreasonably withheld or delayed except as otherwise specifically provided herein. 27 DWD V. 1 SMSA 12/3/03 14.11 Severability. In the event that any of the provisions of this Agreement, or portions or applications thereof, are held to be unenforceable or invalid by any court of competent jurisdiction, the Member and NCPA shall negotiate an equitable adjustment in the provisions of this Agreement with a view toward effecting the purposes of this Agreement, and the validity and enforceability of the remaining provisions, or portions or applications thereof, shall not be affected thereby. 14.12 Legal Capacity. Each Party represents and warrants that it has the legal capacity to enter into this Agreement and to perform all obligations undertaken herein. 14.13 No Counterparts. This Agreement and any amendments will not be executed in counterparts but in one or more duplicate originals which shall constitute but one and the same instrument. 14.14 Further Assurances. If either Party reasonably determines that any further instruments, representation of assurance of payment, or performance, or any other things are necessary or desirable to carry out the terms of this Agreement, the other Party will execute and deliver all such instruments and assurances and do all such things as the first Party reasonably deems necessary or desirable to carry out the terms of this Agreement. 28 DWD V. 1 SMSA 12/3/03 14.15 Hazardous Waste. Although it is not presently contemplated that any Service or Transaction will involve "Hazardous Waste," if on the contrary they do, then this section 15.15 shall apply. "Hazardous Waste" means (A) any product, substance, chemical, element, compound, mixture, solution, material, pollutant, contaminant or waste whose presence, nature, quantity or intensity of use, manufacture, processing, treatment, storage, disposal, transportation, spillage, release, or effect, either by itself or in combination with other materials, is regulated, monitored, or subject to reporting by any federal, state or local government entity; (B) those terms that are included within the definitions of "hazardous substances", "hazardous materials", "hazardous waste", "extremely hazardous substances", "toxic substances", or "oil and hazardous substances", as defined in one or more of the following environmental laws: the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Sec. 9601 et seq. (" CERCLA" ), as amended by the Superfund Amendments and Reauthorization Act of 1986 ("SARA"); the Emergency Planning and Community Right-to-Know Act, 42 U.S.C. Sec. 11001 et seq. ("EPCRTKA"); the Resource Conservation and Recovery Act, 42 U.S.C. Sec. 6901 et seq. ("RCRA'); the Toxic Substances Control Act, 15 U.S.C. Sec. 2601 et seq. ("TSCA"); the Federal Water Pollution Control Act, 33 U.S.C. Sec. 1251 et seq. (the "Clean Water Act"); the Clean Air Act, 42 29 DWD V. 1 SMSA 12/3/03 U.S.C. Sec. 7401 et seq. ("CAA"); the Hazardous Materials Transportation Act, 49 U.S.C. Sec. 5101 et seq. ("HMTA"); the Safe Drinking Water Act, 42 U.S.C. Sec. 300f et seq. ("SDWA"), or comparable state cleanup statutes, and in the regulations promulgated pursuant to said laws, all as amended from time to time; or (C) any material, pollutant, substance or waste that comprises, in whole or in part, includes, or is a by-product or constituent of (i) petroleum (including crude oil or any fraction thereof that is not specifically listed or designated as a hazardous substance, and natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel), (ii) asbestos, (iii) polychlorinated biphenyls, (iv) flammables or explosives, (v) biochemical agents, or (vi) radioactive materials. If, during the course of performing the Services or Transactions, either Party becomes aware of any Hazardous Waste that exists on or under the location of the Service or Transaction, whether or not created or brought on the location by a Party, the Party that so became aware shall report such condition to the Member in writing immediately and before disturbing (or further disturbing) the Hazardous Waste. NCPA shall not be liable for any Hazardous Waste on or under the location notwithstanding the fact that NCPA may have created, brought on, or released the Hazardous Waste into, over, on, or under the location. The 30 DWD V. 1 SMSA 12/3/03 Member shall be solely liable for any Hazardous Waste at the location because of NCPA or any of its employees or subcontractors, and the Member shall perform all cleanup, removal, remediation and disposition services with respect thereto. In the event NCPA encounters Hazardous Waste at the location, NCPA shall take reasonable actions necessary to mitigate costs to the Member or liability of the Member due to such Hazardous Waste. The cost of actions taken by NCPA pursuant to this section shall be fully reimbursed by the Member to NCPA. 14.16 Status of Parties and Regulatory Compliance. The Parties acknowledge that this Agreement is formed between two public agencies. Neither Party shall have any claim against the members, governing officials, officers, employees or agents of either Party. The Member is subject to the regulatory compliance requirements of several agencies. The Member shall be solely responsible for, and shall reimburse NCPA for any costs of compliance with any permits or license conditions, including any fines or penalties, to the maximum extent permitted by law. 14.17 NCPA's Organization. The Member is responsible for assuring for itself that NCPA's personnel are appropriately trained, educated, and skilled to competently perform the Services. The Member acknowledges 31 DWD V. 1 SMSA 12/3/03 and agrees that NCPA makes no warranties or representations regarding the qualifications of its employees, agents, and subcontractors. 14.18 Acknowledgments and Interpretation. The Parties acknowledge and agree that the terms and conditions of this Agreement have been freely and fairly negotiated. The Parties acknowledge that in executing this Agreement they rely solely on their own judgment, belief, and knowledge, and such advice as they may have received from their own counsel, and they have not been influenced by any representation or statements made by any other Party or its counsel. No provision in this Agreement is to be interpreted for or against any Party because that Party or its counsel drafted such provisions. 14.19 Default Termination. Upon the occurrence of a material default, the non- breaching Party shall notify in writing the breaching Party of its intent to terminate this Agreement if the breach is not cured within thirty (30) days. If the breaching Party does not cure the event of default within such thirty (30) day period, the non-breaching Party may immediately terminate this Agreement for Default. Written notice of termination shall be delivered to the breaching Party at the address shown on page 2 of this Agreement or as changed, as provided therein. 14.20 Default Termination Remedies. In the event of a default termination for material breach or abandonment by the Member, NCPA may by 32 DWD V. 1 SMSA 12/3/03 appropriate court action or actions, either at law or in equity, preserve its position to recover damages and expenses associated with the breach; and/or pursue, concurrently or separately, other remedies available in law, in equity or in bankruptcy in anticipation of pursuing its remedies pursuant to Article 16 of this Agreement. 14.21 Survival. The terms of this Agreement shall survive any termination or cancellation hereof to the extent necessary to allow a Party to enforce any remedy granted hereunder in connection with such termination or cancellation. The terms of Article 14 of this Agreement, entitled "Indemnification, Defense, Release, and Covenant Not to Sue" shall survive any termination or cancellation, in perpetuity as to the Release, and otherwise for ten (10) years and one day after the effective date of termination or cancellation. ARTICLE 15- DISPUTE RESOLUTION 15.1 Negotiations. The Parties will attempt in good faith to resolve through negotiation any dispute, arising out of or relating to this Agreement. Either Party may initiate negotiations by providing written notice in letter form to the other Party, setting forth the subject of the dispute and the relief requested. The recipient of such notice will respond in writing within five (5) days with a detailed statement of its position on, and recommended solution to, the dispute. If the dispute is not resolved by 33 DWD V. 1 SMSA 12/3/03 this exchange of correspondence, then representatives of each Party with full settlement authority will meet at a mutually agreeable time and place within ten (10) days of the date of the initial notice in order to exchange relevant information and perspectives, and to attempt to resolve the dispute. If the Parties are unable to resolve the dispute at the meeting by negotiations, they shall consider mediation. During any dispute and negotiation the Member shall continue to timely pay NCPA for Services rendered and Transactions for which obligations remain unsatisfied, even though such dispute may concern those Services or Transactions. NCPA agrees to continue performing the Services, provided that no payment due from the Member is overdue. 15.2 Mediation. The Parties agree that any and all disputes arising out of or relating to this Agreement that are not resolved by their mutual agreement after negotiations pursuant to section 16.1, should be submitted to mediation before JAMS, or its successor or similar alternative dispute resolution (ADR) organization of respected, retired judges, or to a private judge, as the Member may determine, in its reasonable discretion, and with the written consent of NCPA, provided that the Member will be responsible for all of the expenses of mediation. Either Party may commence the mediation process called for in this Agreement by filing a written request for mediation with JAMS, its 34 DWD V. 1 SMSA 12/3/03 successor, or another ADR organization or private judge with a copy to the other Party. The Parties agree that they will participate in the mediation in good faith when and if the Member determines to invoke mediation as a dispute resolution remedy, at its expense. 15.3 Waiver of Certain Judicial Rights. If the Parties fail to either negotiate or mediate a mutually satisfactory resolution of any dispute, then upon written notice given twenty (20) days in advance, either Party may terminate this Agreement, subject to any unpaid or unreimbursed compensation or costs payable by the Member to NCPA, and without affecting the survival of Article 14, entitled "Indemnification, Defense, Release, and Covenant Not to Sue" for its full term, notwithstanding any default hereunder by NCPA. The Parties agree not to, and covenant not to sue, and waive their respective rights thereto. ARTICLE 16 - LIMITATION OF LIABILITY 16.1 Limitation of Liability. To the extent the law allows, NCPA, its members, governing officials, officers, employees, and agents shall have no liability to the Member under this Agreement with respect to all claims however caused, arising out of the performance or non-performance of the Services and obligations under this Agreement, whether based in contract, warranty, tort (including negligence), strict liability, or otherwise, including without limitation, liability for consequential damages pursuant 35 DWD V. 1 SMSA 12/3/03 to Article 17, NCPA shall not be required to carry any insurance, and even if insurance is carried by NCPA, such insurance shall not be available to the Member for any claim, death, damages, injuries, losses of any kind whatsoever, unless, and solely to the extent, that the Member procures such insurance of its own accounts, and pays, and is solely responsible for any and all premiums and costs related to such coverage. If notwithstanding the foregoing limitations of this Section 16.1, liability is imposed, then such total liability shall be limited to the net present value of the expertise NCPA gained through this Agreement that is of value to its other members. ARTICLE 17- CONSEQUENTIAL DAMAGES 17.1 Consequential Damages. NCPA, its members, governing officials, officers, employees, and agents (excluding counterparties) and Member, its officers, employees and agents (excluding counterparties and NCPA) shall not be liable to each other, for incidental, indirect, punitive, exemplary, special or consequential loss or damage arising out of or relating to this Agreement, including, but not limited to, loss of use, customer claims and damages, loss of revenue, loss of power sales, loss of electric system reliability, outages and cascading disturbances, principal office expenses, delay, loss by reason of plant shutdown or inability to operate, increased cost of operating and maintaining the Project, debt 36 DWD V. 1 SMSA 12/3/03 service, rental payments or contractual damages incurred by the Member or NCPA to others. IN WITNESS WHEREOF, the Parties hereto have entered into this Agreement on the Effective Date, having acknowledged and accepted the terms, conditions, promises, and covenants of this Agreement, as evidenced by the following signatures of the representatives of the Parties, who are represented and warranted to be fully and lawfully authorized, by all necessary official action, to execute and deliver this Agreement. MEMBER: NCPA: CITY OF UKIAH NORTHERN CALIFORNIA POWER AGENCY By: By: Name: Candace Horsley Name: Title: City Manger Title: 37 DWD V. 1 SMSA 12/3/03 APPROVED AS TO FORM: APPROVED AS TO FORM: DENNIS W. DE CUIR A Law Corporation By: David J. Rapport City Attorney City of Ukiah By: Dennis W. De Cuir General Counsel ATTEST: By: Clerk 38 DWD V. 1 SMSA 12/3/03 Western Systems Power Pool. Rate Schedule FERC No. 6 EXHIBIT B Western Systems Power Pool Agreement © Western Systems Power Pool, Inc. 2003 All rights reserved Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 1 Superseding Original Sheet No. 1 TABLE OF CONTENTS PAGE 1. PARTIES ............................................................................................................................. 4 2. RECITALS .......................................................................................................................... 4 3. AGREEMENT ..................................................................................................................... 5 4. DEFINITIONS ..................................................................................................................... 5 5. TERM AND TERMINATION .......................................................................................... 11 6. SERVICE SCHEDULES AND WSPP DEFAULT TRANSMISSION TARIFF ............. 12 7. ADMINISTRATION ......................................................................................................... 13 8. EXECUTIVE AND OPERATING COMMITTEES ......................................................... 16 9. PAYMENTS ................................................................................................................... 20B 10. UNCONTROLLABLE FORCES ...................................................................................... 22 11. WAIVERS ......................................................................................................................... 24 12. NOTICES ........................................................................................................................... 24 13. APPROVALS .................................................................................................................... 25 14. TRANSFER OF INTEREST IN AGREEMENT .............................................................. 27 15. SEVERABILITY ............................................................................................................... 28 16. MEMBERSHIP .................................................................................................................. 28 17. RELATIONSHIP OF PARTIES ..................................................................................... 29A 18. NO DEDICATION OF FACILITIES ................................................................................ 30 Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 2 Superseding First Revised Sheet No. 2 TABLE OF CONTENTS PAGE 19. NO RETAIL SERVICES ................................................................................................... 30 20. THIRD PARTY BENEFICIARIES ................................................................................... 30 21. LIABILITY AND DAMAGES ......................................................................................... 30 22. DEFAULT OF TRANSACTIONS UNDER THIS AGREEMENT AND CONFIRMATION AGREEMENTS ................................................................................. 34 22A. DEFAULT IN PAYMENT OF WSPP OPERATING COSTS ......................................... 41 23. OTHER AGREEMENTS .................................................................................................. 43 24. GOVERNING LAW .......................................................................................................... 43 25. JUDGMENTS AND DETERMINATIONS ...................................................................... 43 26. COMPLETE AGREEMENT ............................................................................................. 44 27. CREDITWORTHINESS ................................................................................................... 44 28. NETTING .......................................................................................................................... 46 29. TAXES ............................................................................................................................ 47A 30. CONFIDENTIALITY ........................................................................................................ 48 31. TRANSMISSION TARIFF ............................................................................................... 49 32. TRANSACTION SPECIFIC TERMS AND ORAL AGREEMENTS ............................. 49 33. PERFORMANCE, TITLE, AND WARRANTIES FOR TRANSACTIONS UNDER SERVICE SCHEDULES ................................................................................. 52A 34. DISPUTE RESOLUTION ................................................................................................. 53 35. FORWARD CONTRACTS ............................................................................................... 56 Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Fourth Revised Sheet No. 3 Superseding Third Revised Sheet No. 3 TABLE OF CONTENTS PAGE 36. TRADE OPTION EXCEPTION ....................................................................................... 56 37. ADDITIONAL REPRESENTATIONS AND WARRANTIES ........................................ 57 38. FLOATING PRICES ......................................................................................................... 58 39. AMENDMENT ............................................................................................................... 58B 40. EXECUTION BY COUNTERPARTS ........................................................................... 58C 41. WITNESS .......................................................................................................................... 59 EXHIBIT A: NETTING EXHIBIT B: FORM OF COUNTERPARTY GUARANTEE AGREEMENT EXHIBIT C: SAMPLE FORM FOR CONFIRMATION EXHIBIT D' WSPP MEDIATION AND ARBITRATION PROCEDURES SERVICE SCHEDULES A. ECONOMY ENERGY SERVICE B. UNIT COMMITMENT SERVICE C. FIRM CAPACITY/ENERGY SALE OR EXCHANGE SERVICE LIST OF MEMBERS Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 4 . PARTIES: The Parties to this Western Systems Power Pool Agreement (hereinafter referred to as "Agreement") are those entities that have executed this Agreement, hereinafter sometimes referred to individually as "Party" and collectively as "Parties," but excluding any such entity that withdraws its participation in the Agreement. RECITALS: 2.1 The WSPP experiment has been successfully concluded. Its main purpose was to determine the feasibility of a marketing arrangement which would increase the efficiency of interconnected power system operations above that already being accomplished with existing agreements through increased market knowledge and market pricing of commodities. 2.2 The Parties now desire to proceed with a similar marketing arrangement on a long term basis for prescheduled and real-time coordinated power transactions, such as economy energy transactions, unit commitment service, firm system capacity/energy sales or exchanges. Accordingly, this Agreement, together with any applicable Confirmation Agreement, sets forth the terms and conditions to implement these services within any applicable rate ceilings set forth in the Service Schedules in conformance with FERC orders where applicable. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 5 Superseding First Revised Sheet No. 5 2.3 Each Party meets the membership requirements set out in Section 16. 2.4 The Parties are willing to utilize their respective electric generation and transmission systems or contractual rights thereto to the extent of their respective obligations which are set forth in this Agreement. 3. AGREEMENT: In consideration of the mutual covenants and promises herein set forth, the Parties agree as follows: 4. DEFINITIONS: The following terms, when used herein with initial capitalization, whether in the singular or in the plural, shall have the meanings specified: 4.1 Agreement: This Western Systems Power Pool Agreement, including the Service Schedules and Exhibits attached hereto, as amended; provided, however, that Confirmation Agreements are not included within this definition. 4.la Administrative Committee: A sub-committee of the Executive Committee in accordance with Section 8.1.2. 4.1 aa Broker: An entity or person that arranges trades or brings together Purchasers and Sellers without taking title to the power. 4. lb Business Day(s): Any day other than a Saturday or Sunday or a national (United States or Canadian, whichever is applicable) holiday. United States holidays shall be holidays observed by Federal Reserve member banks in New York City. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 5A Where both the Seller and the Purchaser have their principal place of business in the United States, Canadian holidays shall not apply. Similarly, where both the Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Third Revised Sheet No. 6 Superseding Second Revised Sheet No. 6 Seller and the Purchaser have their principal place of business in Canada, UnitedStates holidays shall not apply. In situations where one Party has its principal place of business within the United States and the other Party's principal place of business is within Canada, both United States and Canadian holidays shall be observed. 4.1 c California ISO: The California Independent System Operator Corporation or any successor organization. 4. ld Confirmation Agreement(s): Any oral agreement or written documentation for transactions under the Service Schedules which sets forth terms and conditions for transactions that are in addition to, substitute, or modify those set forth in the Agreement. A sample written confirmation document is included as Exhibit C. Section 32 of this Agreement provides for such Confirmation Agreements. The Parties may agree to modify terms of this Agreement for more than one transaction pursuant to a separate written agreement. The changes to the Agreement agreed to through such written agreements shall be considered part of the Confirmation Agreement and shall apply to all transactions entered into between the two Parties under the Agreement unless the Parties specifically agree to override such changes for a particular transaction consistent with § 32 of this Agreement. 4.1e Contract Price: The price agreed to between the Seller and the Purchaser for a transaction under the Agreement and any Confirmation Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 6A Superseding First Revised Sheet No. 6A 4.1f 4.2 4.2a 4.2b 4.2c 4.2d 4.3 Contract Quantity: The amount of electric energy and/or capacity to be supplied for a transaction under a Service Schedule as agreed to through any Confirmation Agreement. Control Area: Shall mean an electric system capable of regulating its generation in order to maintain its interchange schedule with other electric systems and to contribute its frequency bias obligation to the interconnection as specified in the North American Electric Reliability Council (NERC) Operating Guidelines. Costs: As defined in Section 22.3 of this Agreement. Dealer: An entity or person that buys or sells power and takes title to the power at some point. Defaulting Party: As defined in Section 22.1 of this Agreement. Determination Period: As defined in Section 38.2 of this Agreement. Economy Energy Service: Non-firm energy transaction whereby the Seller has agreed to sell or exchange and the Purchaser has agreed to buy or exchange energy that is subject to immediate interruption upon notification, in accordance with the Agreement, including Service Schedule A, and any applicable Confirmation Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 7 Superseding First Revised Sheet No. 7 4.4 4.4a 4.4b 4.5 4.6 4.7 Electric Utility: An entity or lawful association which (i) is a public utility, Independent Power Producer, or Power Marketer regulated under applicable state law or the Federal Power Act, or (ii) is exempted from such regulation under the Federal Power Act because it is the United States, a State or any political subdivision thereof or an agency of any of the foregoing, or a Rural Utilities Service cooperative, or (iii) is a public utility, Independent Power Producer, or Power Marketer located in Canada or Mexico that is similarly regulated. ERCOT: Electric Reliability Council of Texas, Inc., the corporation that administers Texas's power grid and is a regional reliability council. Event of Default: As defined in Section 22.1 of this Agreement. Executive Committee: That committee established pursuant to Section 8 of this Agreement. FERC: The Federal Energy Regulatory Commission or its regulatory successor. Firm Capacity/Energy Sale or Exchange Service: Firm capacity and/or energy transaction whereby the Seller has agreed to sell or exchange and the Purchaser has agreed to buy or exchange for a specified period available capacity with or without associated energy which may include a Physically-Settled Option and a capacity transaction in accordance with the Agreement, including Service Schedule C, and any applicable Confirmation Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 7A 4.7a 4.7b 4.7c 4.7d 4.7e First Party: As defined in Section 27 of this Agreement. Floating Price: As defined in Section 38.1 of this Agreement. Gains: As defined in Section 22.3 of this Agreement. Guarantee Agreement: An agreement providing a guarantee issued by a parent company or another entity guaranteeing responsibility for specific obligations for transactions under this Agreement and Confirmation Agreements. A sample form of guarantee is provided in Exhibit B. Guarantor: The entity providing a guarantee pursuant to a Guarantee Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 8 Superseding First Revised Sheet No. 8 4.8 4.9 4.10 4.11 4.1la 4.1lb 4.11c 4.11d 4.11e 4.11f Hub: An electronic communication center that functions as a central point to electronically receive and assemble data for offers to buy or sell power or transmission service from each Party and make that data electronically available concurrently to all Parties. Incremental Cost: The forecasted expense incurred by the Seller in providing an additional increment of energy or capacity during a given hour. Independent Power Producer: An entity which is a non-traditional public utility that produces and sells electricity but which does not have a retail service franchise. Interconnected Transmission System: The total of all transmission facilities owned or operated by the Parties, including transmission facilities over which Parties have scheduling rights. Letter of Credit: An irrevocable, transferable, standby letter of credit, issued by an issuer acceptable to the Party requiring the Letter of Credit. Losses: As defined in Section 22.3 of this Agreement. Market Disruption Event: As defined in Section 38.2 of this Agreement. NERC: North American Electric Reliability Council or any successor organization. Non-Defaulting Party: As defined in Section 22.1 (a) of this Agreement. Non-Performing Party: As defined in Section 21.3(a) of this Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 8A Superseding Original Sheet No. 8A 4.11g Non-Standard Confirmation Provisions: Agreement. 4.11h 4.12 4.13 4.13a 4.13b As defined in Section 32.5 of this NYMEX: New York Mercantile Exchange, the physical commodity futures exchange and a trading forum for energy and precious metals. Operating Agent: An agent of the WSPP as may be designated to the Executive Committee from time to time. Operating Committee: That committee established pursuant to Section 8 of this Agreement. Party or Parties: As defined in Section 1 of this Agreement. Performing Party: As defined in Section 21.3(a) of this Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 9 Superseding Original Sheet No. 9 4.14 4.14a 4.14b 4.14c 4.15 4.16 Power Marketer: An entity which buys, sells, and takes title to electric energy, transmission and/or other services from traditional utilities and other suppliers. Physically-Settled Option: Includes (i) a call option which is the right, but not the obligation, to buy an underlying power product as defined under Service Schedules B or C according to the price and exercise terms set forth in the Confirmation Agreement; and (ii) a put option which is the right, but not the obligation, to sell an underlying power product as defined under Service Schedules B or C according to the price and exercise terms set forth in the Confirmation Agreement. Premium: The amount paid by the Purchaser of a Physically-Settled Option to the Seller of such Option by the date agreed to by the Parties in the Confirmation Agreement. Present Value Rate: As defined in Section 22.3(b) of this Agreement. Purchaser: Any Party which agrees to buy or receive from one or more of the other Parties any service pursuant to the Agreement under any Service Schedule and any applicable Confirmation Agreement. Qualifying Facility: A facility which is a qualifying small power production facility or a qualifying cogeneration facility as these terms are defined in Federal Power Act Sections 3(17)(A), 3(17)(C), 3(18)(A), and 3(18)(B); which meets the requirements set forth in 18 C.F.R. §§ 292.203-292.209; or a facility in Canada or Mexico that complies with similar requirements. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 10 Superseding First Revised Sheet No. 10 4.16a 4.16b 4.16c 4.16d 4.17 4.18 Replacement Price: The price at which the Purchaser, acting in a commercially reasonable manner, effects a purchase of substitute electric energy in place of the electric energy not delivered by the Seller or, absent such a purchase, the market price for such quantity of electric energy, as determined by the Purchaser in a commercially reasonable manner, at the delivery point (agreed upon by the Seller and the Purchaser for the transaction). Retail Entity: A retail aggregator or supplier or retail customer; provided, however, only those Retail Entities eligible for transmission service under the FERC's pro forma open access transmission tariff are eligible to become members of the WSPP. Sales Price: The price at which the Seller, acting in a commercially reasonable manner, effects a resale of the electric energy not received by the Purchaser or, absent such a resale, the market price for such quantity of electric energy at the delivery point (agreed upon by the Seller and the Purchaser), as determined by the Seller in a commercially reasonable manner. Second Party: As defined in Section 27 of this Agreement. Seller: Any Party which agrees to sell or provide to one or more of the other Parties any service pursuant to the Agreement under any Service Schedule and any applicable Confirmation Agreement. Service Schedule: A schedule of services established pursuant to Section 6 of this Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 10A Superseding Original Sheet No. 10A 4.18a Successor in Operation: The successor entity which takes over the wholesale electric trading operations of the first entity either through a merger or restructuring. A Successor in Operation shall not include an entity which merely acquires power sales contracts from the first entity either through a purchase or other means without taking over the wholesale electric trading operations of the first entity. 4.18b Terminated Transaction: As defined in Section 22.2 of this Agreement. 4.18c Termination Payment: As defined in Section 22.2 of this Agreement. 4.18d Trading Day: As defined in Section 38.2 of this Agreement. 4.19 Uncontrollable Forces: As defined in Section 10 of this Agreement or in a Confirmation Agreement. 4.20 Unit Commitment Service: A capacity and associated scheduled energy transaction or a Physically-Settled Option which the Seller has agreed to sell and the Purchaser has agreed to buy from a specified unit(s) for a specified period, in Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 11 Superseding First Revised Sheet No. 11 accordance with the Agreement, including Service Schedule B, and any applicable Confirmation Agreement. 4.20a WSPP: The Western Systems Power Pool, Inc. a corporation organized in 1995 and duly existing under the Utah Revised Nonprofit Corporation Act. 4.20b WSPP Default Transmission Tariff: The transmission tariff filed on behalf of WSPP Members with FERC as it may be amended from time to time. 4.20c WSPP Homepage: WSPP's internet web site, www.wspp.org. 5. TERM AND TERMINATION: 5.1 This Agreement shall become effective as of July 27, 1991 when acceptance or approvals required under Section 13.2 of this Agreement with respect to those Parties that are subject to FERC jurisdiction have been obtained; provided, however, that this Agreement shall not become effective as to any Party in the event the pre-grant of termination requested under Section 13.3 is not allowed by FERC, absent that Party's consent; and provided, further, that this Agreement shall not become effective as to any Party if any terms, conditions or requirements imposed by FERC are found unacceptable by that Party. This Agreement shall continue in effect for a period of ten (10) years from said effective date and thereafter on a year to year basis until terminated by the Parties; provided, however, that any Party may withdraw its participation at any time after the effective date of this Agreement on thirty (30) days prior written notice to all other Parties. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 11A 5.2 As of the effective date of any withdrawal, the withdrawing Party shall have no further rights or obligations under this Agreement except the right to collect Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 12 Superseding Original Sheet No. 12 money or receive service owed to it for transactions under any Service Schedule and the obligation to pay such amounts due to another Party and to complete any transactions agreed to under any Service Schedule as of said date. No Party shall oppose, before any court or regulatory agencies having jurisdiction, any other Party's withdrawal as provided in this Section. 5.3 Except as provided for in Section 5.2, after termination, or withdrawal with respect to the withdrawing Party, all rights to services provided under this Agreement or any tariff or rate schedule which results from or incorporates this Agreement shall cease, and no Party shall claim or assert any continuing right to such services under this Agreement. Except as provided for in Section 5.2, no Party shall be required to provide services based in whole or in part on the existence of this Agreement or on the provision of services under this Agreement beyond the termination date, or date of withdrawal with respect to the withdrawing Party. 6. SERVICE SCHEDULES AND WSPP DEFAULT TRANSMISSION TARIFF: 6.1 The Parties contemplate that they may, from time to time, add or remove Service Schedules under this Agreement. The attached Service Schedules A through C for Economy Energy Service, Unit Commitment Service, and Firm Capacity/Energy Sale or Exchange Service are hereby approved and made a part of this Agreement. Nothing contained herein shall be construed as affecting in any way the right of the Parties to jointly make application to FERC for a change Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 13 Superseding Original Sheet No. 13 o in the rates and charges, classification, service, terms, or conditions affecting WSPP transactions under Section 205 of the Federal Power Act and pursuant to FERC rules and regulations promulgated thereunder. Subject to the provisions of Section 13, future Service Schedules, if any, shall be adopted only by amendment of this Agreement and shall be attached hereto and become a part of this Agreement. 6.2 [RESERVED] 6.3 When the WSPP Default Transmission Tariff applies as specified in the preamble to such Default Transmission Tariff, Transmission Service under it shall be available both to Parties and nonParties under this Agreement; provided, however, each Party or nonParty must be an eligible customer under the WSPP Default Transmission Tariff in order to receive service. ADMINISTRATION: 7.1 The WSPP shall perform the administrative tasks necessary and appropriate to implement this Agreement. All authority to direct, manage and administer the WSPP shall reside in the Executive Committee. All duties assigned under this Agreement, or otherwise, to the Operating Committee, sub-committees, officers, Administrative Committee, or Operating Agent, are delegated powers of the Executive Committee and are Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 13A 7.2 subject to the Executive Committee's direction and control. The WSPP may engage the services of an Operating Agent, from time to time, to perform tasks in furtherance of this Agreement. At least sixty (60) days prior to each calendar year that this Agreement is in effect, the Administrative Committee shall submit a budget for said year of operation to the Operating Committee for review. The proposed budget shall then be submitted, with the Operating Committee's recommendations, to the Executive Committee. The Executive Committee may approve the budget as submitted or with revisions. The Administrative Committee, Operating Committee, and Executive Committee shall address any appropriate revisions of the budget in the same manner. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 14 Superseding Original Sheet No. 14 7.3 The WSPP shall, as necessary, bill the Parties for costs incurred under this Agreement on an estimated basis reasonably in advance of when due, and such billings shall be paid by the Parties when due. Such billings shall be adjusted in the following month(s) to reflect recorded costs. Billing and payment of WSPP costs shall otherwise be implemented in accordance with the provisions of Section o 7.4 The WSPP shall maintain the WSPP Homepage and, as it deems appropriate, may engage a contractor for this purpose. 7.5 Each Party shall maintain a link to the WSPP Homepage and shall be responsible for expenses related thereto. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 15 Superseding Original Sheet No. 15 7.6 7.7 The WSPP, at reasonable times and places, shall make available its books of account, and records and documentation supporting expenditures under this Agreement, for the inspection of any Party for a period of time not to exceed two (2) years from the time such expenditures were incurred. A Party requesting review of the WSPP's records shall give the WSPP sufficient notice of its intent, but in no event less than thirty (30) days. The requesting Party may perform this review using personnel from its own staff or designate a certified public accounting firm for the purpose of this review. All costs incurred to perform this review shall be at the requesting Party's own expense. The Party performing the review shall not voluntarily release the WSPP's records or disclose any information contained therein to any third party unless the written consent of the WSPP and the Executive Committee has been obtained, except as required by law. Upon the termination of this Agreement, in accordance with applicable law, the WSPP shall dispose of any and all of its assets and wind up its affairs as the Executive Committee may direct. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 16 Superseding Original Sheet No. 16 o EXECUTIVE AND OPERATING COMMITTEES: As a means of securing effective and timely cooperation within the activities hereunder and as a means of dealing on a prompt and orderly basis with various problems which may arise in connection with system coordination and operation under changing conditions, the Parties hereby establish an Executive Committee and an Operating Committee. 8.1 Executive Committee: The Executive Committee shall consist of one representative and an alternate from each Party designated pursuant to Section 8.5 herein. The responsibilities of the Executive Committee are as follows: 8.1.1 To establish and amend bylaws of the WSPP consistent with this Agreement and to serve as the Board of Directors of the WSPP in accordance with applicable law. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 16A 8.1.2 To establish sub-committees as it may from time to time deem necessary or appropriate. Such sub-committees shall include an Administrative Committee to administer the affairs of the WSPP as the Executive Committee may direct or approve, which sub-committee shall be comprised of the Chairman, Vice-Chairman, and Secretary/Treasurer of the WSPP and the Chairman and Vice-Chairman of the Operating Committee. 8.1.3 To review at least annually the service activities hereunder to ensure that 8.1.4 such activities are consistent with the spirit and intent of this Agreement. To review any unresolved issues which may arise hereunder and endeavor to resolve the issues. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 17 Superseding Original Sheet No. 17 8.1.5 8.1.6 8.1.7 8.1.8 To review and approve the WSPP's annual budget under this Agreement, and any revision thereto, in accordance with Section 7.2 of this Agreement or otherwise as the Executive Committee deems necessary or appropriate. To amend this Agreement, from time to time, provided that no such amendment or restatement shall be effective unless approved by the FERC and subject to terms and conditions of such approval. To review and act on the application of an entity to become a Party to this Agreement, or to delegate such authority as the Executive Committee deems appropriate.. To do such other things and carry out such duties as specifically required or authorized by this Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 17A 8.1.9 To notify any Party of the rescission of its interest in this Agreement due to its failure to continue to meet the requirements of Section 16.1, or to delegate such authority to the Chairman of the Executive Committee, the Chairman of the Operating Committee, or the Administrative Committee. 8.1.10 To arrange for legal representation of the WSPP. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 18 Superseding Original Sheet No. 18 8.2 Operating Committee: The Operating Committee shall consist of one representative and an alternate from each Party designated pursuant to Section 8.5. The responsibilities of the Operating Committee are as follows: 8.2.1 To establish, review, approve, or modify procedures and standard practices, consistent with the provisions hereof, for the guidance of operating employees in the Parties' electric systems as to matters affecting transactions under this Agreement. 8.2.2 To submit to the Executive Committee any proposed revisions to the Service Schedules or proposed additional Service Schedules. 8.2.3 To submit to the Executive Committee proposed amendments to this Agreement, provided that the Operating Committee shall have no authority to amend this Agreement, and further provided that the Executive Committee may amend this Agreement under Section 8.1.6 without having first received recommendations from the Operating Committee. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 18A 8.2.4 8.2.5 8.2.6 8.2.7 To establish, review, approve, or modify any scheduling or operating procedures required in connection with transactions under this Agreement. To review and make recommendations to the Executive Committee for approval of the annual budget of the WSPP under this Agreement, including any proposed revisions thereto. To review and recommend as necessary the types and arrangement of equipment for intersystem communication facilities to enhance transactions and benefits under this Agreement. To monitor the administration and costs of the WSPP Homepage. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 19 Superseding Original Sheet No. 19 8.3 8.4 8.2.8 If the Executive Committee so directs, to review new member applications for membership in the WSPP under this Agreement and make recommendations on said applications to the Executive Committee, or to delegate such authority as the Operating Committee deems appropriate. 8.2.9 To do such other things and carry out such duties as specifically required or authorized by this Agreement or as directed by the Executive Committee; provided, however, that the Operating Committee shall have no authority to amend this Agreement. All matters which require Operating Committee or Executive Committee approval as provided in this Agreement shall be by no less than ninety percent (90%) affirmative agreement of the committee members present or voting by proxy. Unless otherwise agreed by all committee members of the applicable committee, the Chairman of the Executive Committee and the Chairman of the Operating Committee shall cause all members of the applicable committee to receive notice of a committee meeting at least ten (10) Business Days prior to the date of the meeting. Such notice shall include an agenda of matters to be discussed and voted on at the meeting. All material issues to be submitted to a vote of the committee shall appear on the agenda. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 19A 8.5 In accordance with Section 15.5.2, each Party shall give notice to the other Parties and the WSPP of the name of its designated representative and alternate representative (to act in the absence of the designated representative) on the Executive Committee and Operating Committee, and of any changes thereto. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 20 Superseding First Revised Sheet No. 20 8.6 8.7 Each Party's designated representatives shall be authorized to act on its behalf with respect to votes taken of committee members and other activities of the committee. The Executive Committee shall meet no less than once annually and otherwise as determined by the Chairman in his discretion. The Operating Committee shall meet as necessary, as determined by the Chairman in his discretion. The Chairman shall call a meeting of a committee upon the written request of not less than ten (10) members of the applicable committee. The Executive Committee shall elect a Chairman, Vice-Chairman, and Secretary/Treasurer. The Operating Committee shall elect a Chairman, Vice- Chairman, and Secretary. These officers shall serve terms of two-years duration, which terms shall commence on January 1 of the year following the election and expire on December 31 of the subsequent year, provided, that despite the expiration of an officer's term, the officer shall continue to serve until the officer's successor is elected and commences to serve, and further provided that with or without cause, the Executive Committee or Operating Committee, as applicable, may elect a substitute officer prior to the expiration of a term. 8.7.1 The Chairman of the Executive Committee shall be the Chairman of the Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 20A Superseding Original Sheet No. 20A 8.7.2 8.7.3 8.7.4. WSPP. The Chairman shall preside over meetings of the Executive Committee and, when the Executive Committee is not in session, exercise day to day management and control of the business and affairs of the WSPP, subject at all times to this Agreement and the direction of the Executive Committee. The Vice-Chairman of the Executive Committee shall be the Vice-Chairman of the WSPP. The Vice-Chairman, in the absence or disability of the Chairman, shall exercise the powers and perform the duties of the Chairman and such other duties as the Executive Committee or the Chairman may prescribe, subject at all times to this Agreement and the direction of the Executive Committee. The Secretary/Treasurer shall be the Secretary/Treasurer of the WSPP. The Secretary/Treasurer, or his designee, shall record minutes of meetings and actions of the Executive Committee, perform the customary duties of a secretary and treasurer of a non-profit corporation, and attend to the giving and serving of all notices required by law or under this Agreement. The Chairman of the Operating Committee shall preside over Operating Committee meetings. The Vice Chairman of the Operating Committee shall serve in the absence of the Chairman and perform such other duties as the Operating Committee may assign. The Secretary of the Operating Committee, or his designee, shall record minutes of meetings and actions of the Operating Committee, and shall give Notice of meetings. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 20B . PAYMENTS: 9.1 The accounting and billing period for transactions under this Agreement shall be one (1) calendar month, unless otherwise specified in a Confirmation Agreement. Bills sent to any Party shall be sent to the appropriate billing address as set forth on the WSPP homepage or as otherwise specified by such Party. 9.2 Unless otherwise specified, payments for amounts billed under this Agreement shall be paid so that such payments are received by the Party to be paid on the 20th day of the invoicing month or the tenth (10) day after receipt of the bill, whichever is later. Notwithstanding the foregoing, Premiums shall be paid within three (3) Business Days of receipt of the invoice therefor. Payment shall be made at the location designated by the Party to which payment is due. Payment shall be considered received when payment is received by the Party to which Payment is due at the location designated by that Party. If ~the due date falls on a non- Business Day of either Party, then the payment shall be due on the next following Business Day. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 20C 9.3 Amounts not paid on or before the due date shall be payable with interest calculated daily, at a rate equal to 200 basis points above the per annum Prime Rate reported daily in the Wall Street Journal for the period beginning on the day after the due date and ending on the day of payment, provided that such interest shall not exceed the amount permitted by law. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 21 Superseding First Revised Sheet No. 21 9.4 9.5 9.6 In case any portion of any bill is in dispute, the entire bill shall be paid when due. Any excess amount of bills which, through inadvertent errors or as a result of a dispute, may have been overpaid shall be returned by the owing Party upon determination of the correct amount, with interest calculated in the manner set forth in Section 9.3. The Parties shall have no rights to dispute the accuracy of any bill or payment after a period of two (2) years from the date on which the bill was initially delivered. If a Party's records reveal that a bill was not delivered, then the Party may deliver to the appropriate Party a bill within two (2) years from the date on which the bill would have been delivered under Section 9.1 of this Agreement. The right to payment is waived with respect to any amounts not billed within such two (2) year period. Each Party, or any third party representative of a Party, shall keep complete and accurate records, and shall maintain such data as may be necessary for the purpose of ascertaining the accuracy of all relevant data, estimates, or statements Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 21A Superseding Original Sheet No. 2 lA of charges submitted hereunder for a period of two (2) years from the date the bill was delivered under this Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Third Revised Sheet No. 22 Superseding Second Revised Sheet No. 22 Within a two (2) year period from the date on which the bill was initially delivered, any Party to the applicable transaction may request in writing copies of the records of the other Party for that transaction to the extent reasonably necessary to verify the accuracy of any statement or charge. The Party from which documents or data has been requested shall cooperate in providing the documents and data within a reasonable time period. 10. UNCONTROLLABLE FORCES: No Party shall be considered to be in breach of this Agreement or any applicable Confirmation Agreement to the extent that a failure to perform its obligations under this Agreement or any such Confirmation Agreement shall be due to an Uncontrollable Force. The term "Uncontrollable Force" means an event or circumstance which prevents one Party from performing its obligations under one or more transactions, which event or circumstance is not within the reasonable control of, or the result of the negligence of the claiming Party, and which by the exercise of due diligence, the claiming Party is unable to avoid, cause to be avoided, or overcome. So long as the requirements of the preceding sentence are met, "Uncontrollable Forces" may include and are not restricted to flood, drought, earthquake, storm, fire, lightning, epidemic, war, riot, civil disturbance or disobedience, labor dispute, labor or material shortage, sabotage, restraint by court order or public authority, and action or nonaction by, or failure to obtain the necessary authorizations or approvals from, any governmental agency or authority. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 22A The following shall not be considered "Uncontrollable Forces": (i) the price of electricity faced by Seller; or (ii) Purchaser's inability due to price to use or resell the power purchased hereunder. No Party shall, however, be relieved of liability for failure of performance to the extent that such failure is due to causes arising out of its own negligence or due to removable or remediable causes which it fails to remove or remedy within a reasonable time period. Nothing contained herein shall be construed to require a Issued by: Michael E. Small, General Counsel to Effective: February 1, 2001 Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 23 Superseding Original Sheet No. 23 Party to settle any strike or labor dispute in which it may be involved. Any Party rendered unable to fulfill any of its obligations by reason of an Uncontrollable Force shall give prompt notice of such fact and shall exercise due diligence, as provided above, to remove such inability within a reasonable time period. If oral notice is provided, it shall be promptly followed by written notice. Notwithstanding the "due diligence" obligations or obligations to remove or remedy the causes set forth in the foregoing paragraph (which do not apply to this paragraph except as specified below), where the entity providing transmission services for transactions under any Service Schedule interrupts such transmission service, the interruption in transmission service shall be considered an Uncontrollable Force under this Section 10 only in the following two sets of circumstances: (1) An interruption in transmission service shall be considered an Uncontrollable Force if (a) the Parties agreed on a transmission path for that transaction at the time the transaction under this Agreement was entered into by the Parties' thereto, (b) firm transmission involving that transmission path was obtained pursuant to a transmission tariff or contract to effectuate the transaction under the applicable Service Schedule, and (c) the entity providing transmission service curtailed or interrupted such firm transmission pursuant to the applicable transmission tariff or contract; (2) if the Parties did not agree on the transmission path for a transaction at the time the transaction was entered into, an interruption in transmission service shall be Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 24 considered an Uncontrollable Force only if (a) the Party contracting for transmission services shall have made arrangements with the entity providing transmission service for firm transmission to effectuate the transaction under the applicable Service Schedule, (b) the entity providing transmission service curtailed or interrupted such transmission service due to an event of Uncontrollable Forces or provision of like effect, and (c) the Party which contracted for such firm transmission services could not obtain alternate energy at the delivery point, alternate transmission services, or alternate means of delivering energy after exercising due diligence. No Party shall be relieved by operation of this Section 10 of any liability to pay for power delivered to the Purchaser or to make payments then due or which the Party is obligated to make with respect to performance which occurred prior to the Uncontrollable Force. 11. WAIVERS: Any waiver at any time by any Party of its rights with respect to a default under this Agreement or any Confirmation Agreements, or any other matter under this Agreement, shall not be deemed a waiver with respect to any subsequent default of the same or any other matter. 12. NOTICES: 12.1 Except for the oral notice provided for in Section 10 of this Agreement, any formal notice, demand or request provided for in this Agreement shall be in Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 25 Superseding Original Sheet No. 25 13. writing and shall be deemed properly served, given or made if delivered in person, or sent by either registered or certified mail (postage prepaid), prepaid telegram, fax, overnight delivery (with record of receipt), or other means agreed to by the Parties. 12.2 RESERVED 12.3 Notices and requests of a routine nature applicable to delivery or receipt of power or energy or operation of facilities shall be given in such manner as the committees from time to time or the Parties to a transaction shall prescribe. APPROVALS: 13.1 This Agreement is subject to valid laws, orders, rules and regulations of duly constituted authorities having jurisdiction. Nothing contained in this Agreement shall give FERC jurisdiction over those Parties not otherwise subject to such jurisdiction or be construed as a grant of jurisdiction over any Party by any state or federal agency not otherwise having jurisdiction by law. 13.2 This Agreement, including any Service Schedule hereto, shall become effective as to any Party when it is accepted for filing by FERC, without changes or conditions unacceptable to such Party, for application to the Parties subject to FERC jurisdiction under the Federal Power Act; provided, however, that nothing in this Agreement is intended to restrict the authority of the Bonneville Power Administration (BPA) pursuant to applicable statutory authority to use its existing Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 25A wholesale power and transmission rates or to adopt new rates, rate schedules, or general rate schedule provisions for application under this Agreement and obtain Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 26 interim or final approval of those rates from FERC pursuant to Section 7 of the Pacific Northwest Electric Power Planning and Conservation Act, 16 U.S.C. Sec. 839e, provided such rates do not exceed the maximum rates in the applicable Service Schedule and are consistent with the terms and conditions of said Service Schedule. If, upon filing of this Agreement by Parties subject to FERC jurisdiction under the Federal Power Act, FERC orders a hearing to determine whether this Agreement or a Service Schedule under this Agreement is just and reasonable under the Federal Power Act, the Agreement or Service Schedule shall not become effective until the date when an order issued by FERC, determining this Agreement or the Service Schedule to be just and reasonable without changes or new conditions unacceptable to the Parties, is no longer subject to judicial review. Any changes or conditions imposed by any agency or court, including FERC ordering a hearing, shall be cause for immediate withdrawal by any nonconsenting Party. 13.3 The Parties subject to FERC jurisdiction under the Federal Power Act shall have the right to terminate their participation in this Agreement, and any rate schedule or services included herein, pursuant to the terms of Section 5 of this Agreement and without the necessity of further filing with or approval by FERC. 13.4 Any amendment or change in maximum rates specified in the Service Schedules shall not become effective with regard to any Party that is subject to FERC jurisdiction under the Federal Power Act until it is accepted for filing or Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 27 Superseding Original Sheet No. 27 confirmed and approved by FERC as specified in and subject to the conditions of Section 13.2. 13.5 Nothing contained in this Agreement shall be construed to establish any precedent for any other agreement or to grant any rights to or impose any obligations on any Party beyond the scope and term of this Agreement. 14. TRANSFER OF INTEREST IN AGREEMENT: No Party shall voluntarily transfer its membership under this Agreement without the written consent and approval of all other Parties except to a Successor in Operation of such Party. With regard to the transfer of the rights and obligations of any Party associated with transactions under the Service Schedules, neither Party may assign such rights or obligations unless (a) the other Party provides its prior written consent which shall not be unreasonably withheld; or (b) the assignment is to a Successor in Operation which provides reasonable creditworthiness assurances (see Section 27 for examples of such assurances) if required by the non-assigning Party based upon its reasonably exercised discretion. Any successor or assignee of the rights of any Party, whether by voluntary transfer, judicial or foreclosure sale or otherwise, shall be subject to all the provisions and conditions of this Agreement and Confirmation Agreements (where applicable) to the same extent as though such successor or assignee were the original Party under this Agreement or the Confirmation Agreements, and no assignment or transfer of any rights under this Agreement or any Confirmation Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 27A Agreement shall be effective unless and until the assignee or transferee agrees in writing to assume all of the obligations of the assignor or transferor and to be bound by all of the provisions and Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 28 Superseding Original Sheet No. 28 conditions of this Agreement and any Confirmation Agreement (where applicable). The execution of a mortgage or trust deed or a judicial or foreclosure sale made thereunder shall not be deemed a voluntary transfer within the meaning of this Section 14. 15. SEVERABILITY: In the event that any of the terms, covenants or conditions of this Agreement or any Confirmation Agreement, or the application of any such term, covenant or condition, shall be held invalid as to any person or circumstance by any court, regulatory agency, or other regulatory body having jurisdiction, all other terms, covenants or conditions of this Agreement and the Confirmation Agreement and their application shall not be affected thereby, but shall remain in force and effect unless a court, regulatory agency, or other regulatory body holds that the provisions are not separable from all other provisions of this Agreement or such Confirmation Agreement. 16. MEMBERSHIP: 16.1 Any Electric Utility, Retail Entity or Qualifying Facility may become a Party to this Agreement. The Executive Committee shall notify such Electric Utility, Retail Entity or Qualifying Facility of its decision within sixty (60) days of a request to become a Party to this Agreement, and any acceptable entity shall become a Party hereto by the execution of this Agreement or a counterpart hereof, payment of costs pursuant to Section 16.4, and concluding any necessary acceptance or approval referred to in Section 13. Any such Party, if it is subject to the ratemaking jurisdiction of FERC, Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: May 2, 2001 Effective: July 1, 2001 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 29 Superseding Original Sheet No. 29 shall be responsible for any FERC filing necessary for it to implement its performance under this Agreement. 16.2 Each Party shall continue to meet the requirements of Section 16.1 in order to remain a Party to this Agreement 16.3 Being a Party to this Agreement shall not serve as a substitute for contractual arrangements that may be needed between any Party which operates a Control Area and any other Party which operates within that Control Area. 16.4 Any entity that becomes a Party to this Agreement which was not a party to the experimental Western Systems Power Pool Agreement shall pay a one time fee of $25,000 under this Agreement in recognition of prior efforts and costs incurred by the parties to the experimental Western Systems Power Pool Agreement, which efforts greatly facilitated development of this Agreement. Such fee shall be credited to future costs of the WSPP incurred hereunder. 16.5 In addition to requirements set forth elsewhere in this Agreement imposed on Parties as part of their membership in the WSPP, each Party shall abide by the following requirements: 16.5.1 Each Party shall maintain updated information regarding its Executive Committee and Operating Committee representatives on the WSPP Homepage and shall submit changes within a reasonable time period. 16.5.2 With regard to disputes involving transactions under this Agreement or other agreements, no Party shall seek to conduct discovery of the WSPP or Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 29A compel the testimony of WSPP officers acting in their capacities as officers of the WSPP or of the WSPP's attorneys or consultants with regard to their work for the WSPP, provided that the foregoing prohibition shall not apply in proceedings brought against the WSPP. In the event a Party seeks to compel discovery or testimony in violation of this Section, that Party shall be deemed to have consented to the quashing of the subpoena or other process providing therefor. Notwithstanding any other provision in this Agreement, a Party that seeks to conduct discovery or take testimony in breach of this provision shall compensate the WSPP and its officers, attorneys, and consultants, as applicable, for all out-of-pocket costs incurred. 17. RELATIONSHIP OF PARTIES: 17.1 Nothing contained herein or in any Confirmation Agreement shall be construed to create an association, joint venture, trust, or partnership, or impose a trust or partnership covenant, obligation, or liability on or with regard to any one or more of the Parties. Each Party shall be individually responsible for its own covenants, obligations, and liabilities under this Agreement and under any applicable Confirmation Agreement. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 30 Superseding First Revised Sheet No. 30 18. 19. 20. 21. 17.2 All rights of the Parties are several, not joint. No Party shall be under the control of or shall be deemed to control another Party. Except as expressly provided in this Agreement, no Party shall have a right or power to bind another Party without its express written consent. NO DEDICATION OF FACILITIES: Any undertaking by one Party to another Party under any provision of this Agreement shall not constitute the dedication of the electric system or any portion thereof of the undertaking Party to the public or to the other Party, and it is understood and agreed that any such undertaking under any provision of this Agreement by a Party shall cease upon the termination of such Party's obligations under this Agreement. NO RETAIL SERVICES: Nothing contained in this Agreement shall grant any rights to or obligate any Party to provide any services hereunder directly to or for retail customers of any Party. THIRD PARTY BENEFICIARIES: This Agreement shall not be construed to create rights, in, or to grant remedies to, any third party as a beneficiary of this Agreement or of any duty, obligation or undertaking established herein except as provided for in Section 14. LIABILITY AND DAMAGES: 21.la This Agreement contains express remedies or measures of damages in Sections 21.3 and 22 for non-performance or default. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 30A Superseding Original Sheet No. 30A ALL OTHER DAMAGES OR REMEDIES ARE HEREBY WAIVED. Therefore, except as provided in Sections 21.3 and 22, no Party or its directors, members of its governing bodies, officers or employees shall be liable to any other Party or Parties for any loss or damage to property, loss of earnings, or revenues, personal injury, or any other direct, indirect, or consequential damages or injury, or punitive damages, which may occur or result from the performance or non-performance of this Agreement (including any applicable Confirmation Agreement), including any negligence arising hereunder. Any liability or damages faced by an officer or employee of a Federal agency or by that agency that would result from the operation of this provision shall not be inconsistent with Federal law. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 31 Superseding Original Sheet No. 31 21.2 Notwithstanding any other provision in this Agreement, any Party due monies under this Agreement, the amounts of which are not in dispute or if disputed have been the subject of a decision awarding such amounts, (i) shall have the right to seek payment of such monies in any forum having competent jurisdiction and (ii) shall possess the right to seek relief directly from that forum without first utilizing the mediation or arbitration provisions of this Agreement and without exercising termination and liquidation rights under Section 22. 21.3 The following damages provision shall apply to transactions under Service Schedules B and C. For transactions under Service Schedule A, this damages provision or some other damages provision will apply only if such a damages provision is agreed to through a Confirmation Agreement. The damages under this Section 21.3 apply to a Party's failure to deliver or receive electric power or energy in violation of the terms of the Agreement and any Confirmation Agreement. The Contract Quantity and Contract Price referred to in this Section Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 3 lA 21.3 are part of the agreement between the Parties for which damages are being calculated under this Section. (a) If either Party fails to deliver or receive, as the case may be, the quantities of electric power or energy due under the Agreement and any Confirmation Agreement (thereby becoming a "Non-Performing Party" for the purposes of this Section 21.3), the other party (the "Performing Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 32 Party") shall be entitled to receive from the Non-Performing Party an amount calculated as follows (unless performance is excused by Uncontrollable Forces as provided in Section 10, the applicable Service Schedule, or by the Performing Party): (1) If the amount the Purchaser scheduled or received in any hour is less than the applicable hourly Contract Quantity, then the Purchaser shall be liable for (a) the product of the amount (whether positive or negative), if any, by which the Contract Price differed from the Sales Price (Contract Price - Sales Price) and the amount by which the quantity received by the Purchaser was less than the hourly Contract Quantity; plus (b) the amount of transmission charge(s), if any, for firm transmission service upstream of the delivery point, which the Seller incurred to achieve the Sales Price, less the reduction, if any, in transmission charge(s) achieved as a result of the reduction in the Purchaser's schedule or receipt of electric energy (based on Seller's reasonable commercial efforts to achieve such reduction). If the total amounts for all hours calculated under this paragraph (1) are negative, then neither the Purchaser nor the Seller shall pay any amount under this Section 21.3(a)(1). Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 33 Superseding Original Sheet No. 33 (2) If the amount the Seller scheduled or delivered in any hour is less than the applicable hourly Contract Quantity, then the Seller shall be liable for (a) the product of the amount (whether positive or negative), if any, by which the Replacement Price differed from the Contract Price (Replacement Price - Contract Price) and the amount by which the quantity delivered by the Seller was less than the hourly Contract Quantity; plus (b) the amount of transmission charge(s), if any, for firm transmission service downstream of the delivery point, which the Purchaser incurred to achieve the Replacement Price, less the reduction, if any, in transmission charge(s) achieved as a result of the reduction in the Seller's schedule or delivery (based on Purchaser's reasonable commercial effort to achieve such reduction). If the total amounts for all hours calculated under this paragraph (2) are negative, then neither the Purchaser nor the Seller shall pay any amount under this Section 21.3(a)(2). (3) The Non-Performing Party also shall reimburse the Performing Party for any charges imposed on the Performing Party under open access transmission tariffs due to the non-performance. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 33A Superseding Original Sheet No. 33A (4) The Non-Performing Party shall pay any amount due from it under this section within the billing period as specified in Section 9 of this Agreement or agreed to in the applicable Confirmation Agreement if the Parties agreed to revise the billing period in Section 9. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 34 (b) The Parties agree that the amounts recoverable under this Section 21.3 are a reasonable estimate of loss and not a penalty, and represent the sole and exclusive remedy for the Performing Party. Such amounts are payable for the loss of bargain and the loss of protection against future risks. (c) Each Party agrees that it has a duty to mitigate damages in a commercially reasonable manner to minimize any damages it may incur as a result of the other Party's performance or non-performance of this Agreement. (d) In the event the Non-Performing Party disputes the calculation of the damages under this Section 21.3, the Non-Performing Party shall pay the full amount of the damages as required by Section 9 of this Agreement to the Performing Party. After informal dispute resolution as required by Section 34.1, any remaining dispute involving the calculation of the damages shall be referred to binding dispute resolution as provided by Section 34.2 of this Agreement. If resolution or agreement results in refunds or the need for refunds to the Non-Performing Party, such refunds shall be calculated in accordance with Section 9.4 of this Agreement. 22. DEFAULT OF TRANSACTIONS UNDER THIS AGREEMENT AND CONFIRMATION AGREEMENTS: 22.1 EVENTS OF DEFAULT An "Event of Default" shall mean with respect to a Party ("Defaulting Party"): Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 35 Superseding Original Sheet No. 35 (a) the failure by the Defaulting Party to make, when due, any payment required pursuant to this Agreement or Confirmation Agreement if such failure is not remedied within two (2) Business Days after written notice of such failure is given to the Defaulting Party by the other Party ("the Non-Defaulting Party"). The Non-Defaulting Party shall provide the notice by facsimile to the designated contact person for the Defaulting Party and also shall send the notice by overnight delivery to such contact person; or (b) the failure by the Defaulting Party to provide clear and good title as required by Section 33.3, or to have made accurate representations and warranties as required by Section 37 and such failure is not cured within five (5) Business Days after written notice thereof to the Defaulting Party; or (c) The institution, with respect to the Defaulting Party, by the Defaulting Party or by another person or entity of a bankruptcy, reorganization, moratorium, liquidation or similar insolvency proceeding or other relief under any bankruptcy or insolvency law affecting creditor's rights or a petition is presented or instituted for its winding-up or liquidation; or (d) The failure by the Defaulting Party to provide adequate assurances of its ability to perform all of its outstanding material obligations to the Non- Defaulting Party under the Agreement or Confirmation Agreement Issued by: Michael E. Small, General Counsel to Effective: February 1, 2001 Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 36 Superseding First Revised Sheet No. 36 pursuant to Section 27 of this Agreement or any substitute or modified provision in the Confirmation Agreement. (e) With respect to its Guarantor, if any: (i) if a material representation or warranty made by a Guarantor in connection with this Agreement, or any transaction entered into hereunder, is false or misleading in any material respect when made or when deemed made or repeated; or (ii) the failure of a Guarantor to make any payment required or to perform any other material covenant or obligation in any guarantee made in connection with this Agreement, including any transaction entered into hereunder, and such failure shall not be remedied within three (3) Business Days after written notice; or .(iii) the institution, with respect to the Guarantor, by the Guarantor or by another person or entity of a bankruptcy, reorganization, moratorium, liquidation or similar insolvency proceeding or other relief under any bankruptcy or insolvency law affecting creditor's rights or a petition is presented or instituted for its winding-up or liquidation; or (iv) the failure, without written consent of the other Party, of a Guarantor's guarantee to be in full force and effect for purposes of this Agreement (other than in accordance with its terms) prior to Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 36A Superseding First Revised Sheet No. 36A the satisfaction of all obligations of such Party under each transaction to which such guarantee shall relate; or (v) a Guarantor shall repudiate, disaffirm, disclaim, or reject, in whole or in part, or challenge the validity of, any guarantee. 22.2 REMEDIES FOR EVENTS OF DEFAULT If an Event of Default occurs, the Non-Defaulting Party shall possess the right to terminate all transactions between the Parties under this Agreement upon written notice (by facsimile or other reasonable means) to the Defaulting Party, such notice of termination to be effective immediately upon receipt. If the Non- Defaulting Party fails to exercise this right of termination within thirty (30) days following the time when the Event of Default becomes known (or more than thirty days if the Non-Defaulting and Defaulting Parties agree to an extension), then such right of termination shall no longer be available to the Non-Defaulting Party as a remedy for the Event(s) of Default; provided, however, this thirty day requirement for exercising termination rights shall not apply to defaults pursuant to Sections 22.1(c) and 22.1(e)(iii). The Non-Defaulting Party terminating transaction(s) under this Section 22.2 may do so without making a filing at FERC. Upon termination, the Non-Defaulting Party shall liquidate all transactions as soon as practicable, provided that in no event will the Non-Defaulting Party be allowed to liquidate Service Schedule A transactions. The payment associated with termination ("Termination Payment") shall be calculated in accordance with Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 FirSt Revised Sheet No. 36B Superseding Original Sheet No. 36B this Section 22.2 and Section 22.3. The Termination Payment shall be the sole and exclusive remedy for the Non-Defaulting Party for each terminated transaction ("Terminated Transaction") for the time period beginning at the time notice of termination under this Section 22 is received. Prior to receipt Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 37 of such notice of termination by the Defaulting Party, the Non-Defaulting Party may exercise any remedies available to it under Section 21.3 of this Agreement or Confirmation Agreement(s), and any other remedies available to it at law or otherwise. Upon termination, the Non-Defaulting Party may withhold any payments it owes the Defaulting Party for any obligations incurred prior to termination under this Agreement or Confirmation Agreement(s) until the Defaulting Party pays the Termination Payment to the Non-Defaulting Party. The Non-Defaulting Party shall possess the right to set-off the amount due it under this Section 22 by any such payments due the Defaulting Party as provided in Section 22.3(d). 22.3 LIQUIDATION CALCULATION OPTIONS The Non-Defaulting Party shall calculate the Termination Payment as follows: (a) The Gains and Losses shall be determined by comparing the value of the remaining term, transaction quantities, and transaction prices under each Terminated Transaction had it not been terminated to the equivalent quantities and relevant market prices for the remaining term either quoted by a bona fide third-party offer or which are reasonably expected to be available in the market under a replacement contract for each Terminated Transaction. To ascertain the market prices of a replacement contract, the Non-Defaulting Party may consider, among other valuations, quotations Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 38 Superseding Original Sheet No. 38 (b) (c) from Dealers in energy contracts, any or all of the settlement prices of the NYMEX power futures contracts (or NYMEX power options contracts in the case of Physically-Settled Options) and other bona fide third party offers, all adjusted for the length of the remaining term and differences in transmission. It is expressly agreed that the Non-Defaulting Party shall not be required to enter into replacement transactions in order to determine the Termination Payment. The Gains and Losses calculated under paragraph (a) shall be discounted to present value using the Present Value Rate as of the time of termination (to take account to the period between the time notice of termination was effective and when such amount would have otherwise been due pursuant to the relevant transaction). The "Present Value Rate" shall mean the sum of 0.50% plus the yield reported on page "USD" of the Bloomberg Financial Markets Services Screen (or, if not available, any other nationally recognized trading screen reporting on-line intraday trading in United States government securities) at 11:00 a.m. (New York City, New York time) for the United States government securities having a maturity that matches the average remaining term of the Terminated Transactions; and The Non-Defaulting Party shall set off or aggregate, as appropriate, the Gains and Losses (as calculated in Section 22.3(a)) and Costs and notify Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 39 Superseding Original Sheet No. 39 the Defaulting Party. If the Non-Defaulting Party's aggregate Losses and Costs exceed its aggregate Gains, the Defaulting Party shall, within three (3) Business Days of receipt of such notice, pay the Termination Payment to the Non-Defaulting Party, which amount shall bear interest at the Present Value rate from the time notice of termination was received until paid. If the Non-Defaulting Party's aggregate Gains exceed its aggregate Losses and Costs, the Non-Defaulting Party, after any set-off as provided in paragraph (d), shall pay the remaining amount to the Defaulting Party within three (3) Business Days of the date notice of termination was received including interest at the Present Value from the time notice of termination was received until the Defaulting Party receives payment. (d) The Non-Defaulting Party shall aggregate or set off, as appropriate, at its election, any or all other amounts owing between the Parties (discounted at the Present Value Rate) under this Agreement and any Confirmation Agreements against the Termination Payment so that all such amounts are aggregated and/or netted to a single liquidated amount. The net amount due from any such liquidation shall be paid within three (3) Business Days following the date notice of termination is received. (e) (i) If the Non-Defaulting Party owes the Defaulting Party monies under this Section 22.3, then notwithstanding the three Business Day payment requirement detailed above, the Non-Defaulting Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 39A Superseding Original Sheet No. 39A Party may elect to pay the Defaulting Party the monies owed under this Section 22.3 over the remaining life of the contract(s) being terminated. The Non-Defaulting Party may make this election by providing written notice to the Defaulting Party within three Business Days of the notice being provided to terminate and liquidate under this Section 22.3. The Non-Defaulting Party shall provide the Defaulting Party with the details on the method for recovering the monies owed over the remaining life of the contract(s). That method shall ensure that the Defaulting Party receives a payment each month through the end of the term of each contract which allows it to receive the monies which would have been due it under Sections 22.3(c) and (d) in total (to be recovered over the term of the contract(s) to replicate as closely as possible the payment streams under such contract(s)) provided that the discounting using the Present Value Rate referenced in Section 22.3 (b) shall not be reflected in determining the amounts to be recovered under this provision. Any disputes as to the methodology shall be resolved pursuant to the dispute resolution procedures in Section 34, with binding arbitration pursuant to Section 34.2 required for disputes as to the methodology if mediation is unsuccessful. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 39B Superseding Original Sheet No. 39B (ii) This Section 22.3(e) and the rights and obligations under it shall survive termination of any applicable transactions or agreements. (iii) The Party owed monies under this Section 22.3(e) shall have the right to request credit assurances consistent with Section 27 even after termination of any contract or transaction. (iv) If the Party owing money defaults on its payment obligations consistent with Section 22.1 (a) or defaults with regard to providing credit assurances consistent with Section 22.1(d), then the other Party shall have the right (by written notice) at any time after the Party owing money defaults to require that Party to pay all monies owed under all of the contracts subject to this Section 22.3(e) within three Business Days of receipt of the written notice. The monies to be paid under this accelerated payment provision shall be the remaining amounts to be paid under the contract(s) reflecting a discount using the Present Value Rate from the date of the written notice. If the Defaulting Party disagrees with the calculation of the Termination Payment and the Parties cannot otherwise resolve their differences, the calculation issue shall be submitted to informal dispute resolution as provided in Section 34.1 Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 40 Superseding Original Sheet No. 40 of this Agreement and thereafter binding dispute resolution pursuant to Section 34.2 if the informal dispute resolution does not succeed in resolving the dispute. Pending resolution of the dispute, the Defaulting Party shall pay the full amount of the Termination Payment calculated by the Non-Defaulting Party within three (3) Business Days of receipt of notice as set forth in Sections 22.3(c) and (d) subject to the Non-Defaulting Party refunding, with interest, pursuant to Section 9.4, any amounts determined to have been overpaid. For purposes of this Section 22.3: (i) "Gains" means the economic benefit (exclusive of Costs), if any, resulting from the termination of the Terminated Transactions, determined in a commercially reasonable manner as calculated in accordance with this Section 22.3; (ii) "Losses" means the economic loss (exclusive of Costs), if any, resulting from the termination of the Terminated Transactions, determined in a commercially reasonable manner as calculated in accordance with this Section 22.3; (iii) "Costs" means brokerage fees, commissions and other similar transaction costs and expenses reasonably incurred in terminating any specifically related arrangements which replace a Terminated Transaction, transmission and ancillary service costs associated with Terminated Transactions, and reasonable attorneys' fees, if any, incurred in connection Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 41 22A. with the Non-Defaulting Party enforcing its rights with regard to the Terminated Transactions. The Non-Defaulting Party shall use reasonable efforts to mitigate or eliminate these Costs. (iv) In no event, however, shall a Party's Gains, Losses or Costs include any penalties or similar charges imposed by the Non-Defaulting Party. DEFAULT IN PAYMENT OF WSPP OPERATING COSTS: 22A. 1 A Party shall be deemed to be in default in payment of its share of WSPP operating costs pursuant to Section 7 of this Agreement, if any, when payment is not received within ten (10) days after receipt of written notice. A default by any Party in such payment obligations shall be cured by payment of all overdue amounts together with interest accrued at the rate of one percent (1%) per month, or the maximum interest rate permitted by law, if any, whichever is less, prorated by days from the due date to the date the payment curing the default is made unless and until the Executive Committee shall determine another rate. 22A.2 A defaulting Party, which is in default under Section 22.A1, shall be liable for all costs, including costs of collection and reasonable attorney fees, plus interest as provided in Section 22.A1 hereof. 22A.3 The rights under this Agreement of a Party which is in default of its obligation to pay operating costs under this Agreement for a period of three (3) months or more may be revoked by a vote of the non-defaulting Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 42 Parties' representatives on the Executive Committee consistent with Section 8.3. The defaulting Party's rights shall not be revoked, however, unless said Party has received at least thirty (30) days written notice of the non-defaulting Parties' intent to revoke such rights. Said notice shall state the date on which the revocation of rights shall become effective if the default is not cured and shall state all actions which must be taken or amounts which must be paid to cure the default. This provision allowing the non-defaulting Parties to revoke such rights is in addition to any other remedies provided in this Agreement or at law and shall in no way limit the non-defaulting Parties' ability to seek judicial enforcement of the defaulting Party's obligations to pay its share of the operating costs under this Agreement. Upon the effective date of such revocation of rights, the defaulting party shall not be allowed to enter into any new transactions under this Agreement. The defaulting party under the Agreement or any Confirmation Agreements shall be required to carry out all obligations that existed prior to the effective date of such revocation. If a defaulting Party's rights under this Agreement have been revoked, the Executive Committee may restore that Party's rights upon the defaulting Party paying all amounts due and owing under this Agreement. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 42A 22A.4 Upon revocation of the rights of a defaulting Party under this Agreement, costs of the WSPP hereunder shall be equally shared among the Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 43 Superseding Original Sheet No. 43 remaining Parties. Cost allocation adjustments shall be retroactive to the date of the default. 23. OTHER AGREEMENTS: No provision of this Agreement shall preclude any Party from entering into other agreements or conducting transactions under existing agreements with other Parties or third parties. This Agreement shall not be deemed to modify or change any rights or obligations under any prior contracts or agreements between or among any of the Parties. 24. GOVERNING LAW: This Agreement and any Confirmation Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without regard to the conflicts of laws rules thereof. The foregoing notwithstanding, (1) if both the Seller and Purchaser are organized under the laws of Canada, then the laws of the province of the Seller shall govern, or (2) if the Seller or Purchaser is an agency of or part of the United States Government, then the laws of the United States of America shall govern. 25. JUDGMENTS AND DETERMINATIONS: Whenever it is provided in this Agreement that a Party shall be the sole judge of whether, to what extent, or under what conditions it will provide a given service, its exercise of its judgment shall be final and not subject to challenge. Whenever it is provided that (i) a service under a given transaction may be curtailed under certain conditions or circumstances, the existence of which are determined by or in the judgment of a Party, or (ii) the existence of qualifications for membership shall be determined by Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 44 Superseding Original Sheet No. 44 26. 27. the Executive Committee pursuant to Section 16, that Party's or the Executive Committee's determination or exercise of judgment shall be final and not subject to challenge if it is made in good faith and not made arbitrarily or capriciously. COMPLETE AGREEMENT: This Agreement and any subsequent amendments, including the Service Schedules and Exhibits incorporated herein, and any Confirmation Agreement, shall constitute the full and complete agreement of the Parties with respect to the subject matter hereof, and all prior or contemporaneous representations, statements, negotiations, understandings and inducements are fully merged and incorporated in this Agreement. CREDITWORTHINESS: Should a Party's creditworthiness, financial responsibility, or performance viability become unsatisfactory to the other Party in such other Party's reasonably exercised discretion with regard to any transaction pursuant to this Agreement or any Confirmation Agreement, the dissatisfied Party (the "First Party") may require the other Party (the "Second Party") to provide, at the Second Party's option (but subject to the First Party's acceptance based upon reasonably exercised discretion), either (1) the posting of a Letter of Credit, (2) a cash prepayment, (3) the posting of other acceptable collateral or security by the Second Party, (4) a Guarantee Agreement executed by a creditworthy entity; or (5) some other mutually agreeable method of satisfying the First Party. The Second Party's obligations under this Section 27 shall be limited to a reasonable estimate of the damages to the First Party Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 45 Superseding Original Sheet No. 45 (consistent with Section 22.3 of this Agreement) if the Second Party were to fail to perform its obligations. Events which may trigger the First Party questioning the Second Party's creditworthiness, financial responsibility, or performance viability include, but are not limited to, the following: (1) The First Party has knowledge that the Second Party (or its Guarantor if (2) applicable) are failing to perform or defaulting under other contracts. The Second Party has exceeded any credit or trading limit set out in the Confirmation Agreement or other agreement between the Parties. (3) The Second Party or its Guarantor has debt which is rated as investment grade and that debt falls below the investment grade rating by at least one rating agency or is below investment grade and the rating of that debt is downgraded further by at least one rating agency. (4) Other material adverse changes in the Second Party's financial condition occur. (5) Substantial changes in market prices which materially and adversely impact the Second Party's ability to perform under this Agreement or any Confirmation Agreement occur. If the Second Party fails to provide such reasonably satisfactory assurances of its ability to perform a transaction hereunder within three (3) Business Days of demand therefore, that will be considered an Event of Default under Section 22 of this Agreement and the First Party shall have the right to exercise any of the remedies provided for under Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: August 1, 2003 Effective: October 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 46 Superseding Original Sheet No. 46 that Section 22. Nothing contained in this Section 27 shall affect any credit agreement or arrangement, if any, between the Parties. 28. NETTING: 28.1 If the Purchaser and the Seller are each required to pay an amount to each other in the same calendar month for transactions under this Agreement, then such amounts with respect to each Party may be aggregated and the Parties may discharge their obligations to pay through netting of the respective amounts due, in which case the Party, if any, owing the greater aggregate amount may pay to the other Party the difference between the amounts owed. Each Party reserves to itself all rights, set-offs, counterclaims, and other remedies and defenses (to the extent not expressly herein waived or denied) which such Party has or may be entitled to arising from or out of this Agreement and any applicable Confirmation Agreements. 28.2 Parties shall net payments (associated with transactions under this Agreement and Confirmation Agreement) in accordance with Exhibit A, if such Parties have executed the form attached as Exhibit A. The Parties obligation to net shall include the netting of all payments received by the Parties in the same calendar month. Parties that have executed Exhibit A shall provide a signed copy of Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 47 Superseding Original Sheet No. 47 Exhibit A to a representative of the WSPP and to any Party that requests a copy and indicate on the WSPP Homepage that they have so executed Exhibit A (once the WSPP Homepage possesses the necessary capability). If a Party indicated its election to net payments on the WSPP Homepage and that Party desires to withdraw its agreement to net, that Party shall provide at least 30 days notice on the WSPP Homepage of the change in its election to net and also shall provide, concurrent with its withdrawal notice, written notice to all Parties with which it has ongoing transactions or with which it has committed to future transactions under the Agreement at the time of the notice. Any such changes in netting status shall apply beginning at least 30 days after notice required by this Section 28.2 is provided and only shall apply to transactions agreed to beginning on or after the date the change in netting status becomes effective. 28.3 The Parties may by separate agreement either through a Confirmation Agreement or some other agreement set out specific terms relating to the implementation of the netting in addition to or in lieu of Exhibit A. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 47A 29. TAXES: The Contract Price for all transactions under the Service Schedules shall include full reimbursement for, and the Seller is liable for and shall pay, or cause to be paid, or reimburse the Purchaser for if the Purchaser has paid, all taxes applicable to a transaction that arise prior to the delivery point. If the Purchaser is required to remit such tax, the amount shall be deducted from any sums due to the Seller. The Seller shall indemnify, Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 48 Superseding Original Sheet No. 48 defend, and hold harmless the Purchaser from any claims for such taxes. The Contract Price does not include reimbursement for, and the Purchaser is liable for and shall pay, cause to be paid, or reimburse the Seller for if the Seller has paid, all taxes applicable to a transaction arising at and from the delivery point, including any taxes imposed or collected by a taxing authority with jurisdiction over the Purchaser. The Purchaser shall indemnify, defend, and hold harmless the Seller from any claims for such taxes. Either Party, upon written request of the other Party, shall provide a certificate of exemption or other reasonably satisfactory evidence of exemption if either Party is exempt from taxes, and shall use reasonable efforts to obtain and cooperate with the other Party in obtaining any exemption from or reduction of any tax. Taxes are any amounts imposed by a taxing authority associated with the transaction. 30. CONFIDENTIALITY: 30.1 The terms of any transaction under this Agreement or any other information exchanged by the Purchaser and Seller relating to the transaction shall not be disclosed to any person not employed or retained by the Purchaser or the Seller or their affiliates, except to the extent disclosure is (1) required by law, (2) reasonably deemed by the disclosing Party to be required to be disclosed in connection with a dispute between or among the Parties, or the defense of any litigation or dispute, (3) otherwise permitted by consent of the other Party, which consent shall not be unreasonably withheld, (4) required to be Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 48A made in connection with regulatory proceedings (including proceedings relating to FERC, the United States Securities and Exchange Commission or any other Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 49 Superseding Original Sheet No. 49 federal, state or provincial regulatory agency); (5) required to comply with North American Electric Reliability Organization, regional reliability council, or successor organization requirements; (6) necessary to obtain transmission service; or (7) to a developer of an index of electric power prices in accordance with Section 30.2. In the event disclosure is made pursuant to this provision, the Parties shall use reasonable efforts to minimize the scope of any disclosure and have the recipients maintain the confidentiality of any documents or confidential information covered by this provision, including, if appropriate, seeking a protective order or similar mechanism in connection with any disclosure. This provision shall not apply to any information that was or is hereafter in the public domain (except as a result of a breach of this provision). 30.2 A Party may disclose the terms of transactions under this Agreement, excluding the identities of parties, to any developer of any index of electric power prices without violation of the confidentiality obligations under Section 30.1 if: (1) the disclosing Party and the index developer have entered into a written agreement, prior to the disclosure, under which the developer has agreed to use the information solely for the development of an index of electric power prices for publication and not for any other purpose; and (2) the index with respect to which disclosure is made is an aggregation of terms of transactions and does not identify terms of single transactions or the identities of parties to transactions. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 49A 31. TRANSMISSION TARIFF: Pursuant to FERC Order No. 888, issued on April 24, 1996, and FERC orders where applicable, the WSPP Default Transmission Tariff has been filed and has become effective. The Parties agree to be bound by the terms of that Tariff for so long as they are Western Systems Power Pool members. 32. TRANSACTION SPECIFIC TERMS AND ORAL AGREEMENTS: 32.1 The Parties' agreement to transaction specific terms which constitute the Confirmation Agreement shall be made by one of the following methods: (1) provision of pertinent information through written Confirmation Agreements (see Exhibit C for a sample); or (2) oral conversation, provided that such oral conversation is recorded electronically. By mutual agreement and consistent with and pursuant to the provisions of this Section 32, the Parties to a transaction under Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 Third Revised Sheet No. 50 Superseding Second Revised Sheet No. 50 this Agreement may agree to modify any term of this Agreement which applies to such transaction (but not to provisions regarding the operation of the WSPP as an organization including Sections 7 and 8), such agreement to be reflected in a Confirmation Agreement. Written confirmation shall be required for all transactions of one week or more. Upon request of the Purchaser or at the election of the Seller, the Seller shall provide written confirmation which must be received by the Purchaser within five Business Days of the date of the agreement or request. The Purchaser shall have five Business Days from date of receipt to respond to the confirmation. If the Purchaser does not respond within that time period, the Seller's written confirmation shall be considered as accepted and final except as provided in Section 32.5. If the Seller fails to provide any required written confirmation within five Business Days, as described above, then the Purchaser may submit a written confirmation to the Seller. The Purchaser shall submit such written confirmation within five Business Days after the deadline for submitting a written confirmation applicable to the Seller as set forth above has expired. If the Seller fails to respond to Purchaser's confirmation within five Business Days, then the Purchaser's written confirmation shall be considered as accepted and final except as provided in Section 32.5. Notwithstanding the foregoing, any failure of the Seller or the Purchaser to provide written confirmation of the transaction shall not invalidate any oral agreement of the Parties except for oral agreements prohibited by Section 32.5. Nor shall any oral agreement of the Parties be considered invalidated Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 50A Superseding First Revised Sheet No. 50A before and during the time period the confirmation process is ongoing and no final Confirmation Agreement under these procedures or through mutual agreement has been reached. For transactions of less than one week in duration (as agreed in an electronically recorded conversation) and that commence within one week of that conversation, a written confirmation will have no effect unless it is signed by both parties. The foregoing sentence does not apply to Non-Standard Confirmation Provisions of such a transaction (to which Section 32.5 applies). Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: November 19, 2003 Effective: February 1, 2004 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 51 32.2 The Parties agree not to contest, or assert any defense with respect to, the validity or enforceability of any agreement to the terms concerning a specific transaction(s), on the basis that documentation of such terms fails to comply with the requirements of any statute that agreements be written or signed. Each Party consents to the recording by the other Party, without any further notice, of telephone conversations between representatives of the Parties, which contain agreements to or discussion concerning the terms of a specific transaction(s). All such recordings may be introduced and admitted into evidence for the purpose of proving agreements to terms, and any objection to such introduction or admission for such purpose is hereby expressly waived. The terms documented hereunder, whether stated in a written document or a recording, are intended by the Parties as a final expression of their agreement with respect to such terms as are included therein and may not be contradicted by evidence of any prior agreement, but may be supplemented by course of dealing, performance, usage of trade and evidence of consistent additional mutually agreed-upon terms. 32.3 For individual transactions under the Service Schedules, the Agreement as it may be modified or supplemented by a Confirmation Agreement shall bind the Parties and govern the transactions; provided, however, if the Parties to a transaction do not reach agreement on such modification or change to a term of the Agreement, or the Confirmation Agreement is not considered accepted and final pursuant to Section 32.1, then the term or terms of the Agreement, which the Parties could not Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 52 Superseding First Revised Sheet No. 52 reach agreement to modify or change or which are not considered modified pursuant to Section 32.1, shall apply to that transaction. In the event of a conflict between a binding and effective Confirmation Agreement and this Agreement, the Confirmation Agreement shall govern. 32.4 The Seller shall not be required to file written confirmations with FERC except as provided in the Service Schedules. 32.5 When a Confirmation Agreement contains Non-Standard Confirmation Provisions which are provisions other than those set forth in paragraphs (a) - (1) of Exhibit C, those Non-Standard Confirmation Provisions shall not be deemed to be accepted pursuant to Section 32.1 unless agreed to: (i) orally, with that oral agreement recorded (provided that such oral agreement option only shall be available for transactions of less than one week); or (ii) in a writing executed by both Parties. 32.6 Other Products and Service Levels: The Parties may agree to use a product/service level defined by a different agreement (e.g., the California ISO tariff, the ERCOT agreement or the EEI agreement) for a particular transaction under this Agreement. Unless the Parties expressly state and agree that all the terms and conditions of such other agreement will apply to any such transaction, the transaction shall be subject to all the terms of this Agreement, except that (1) all service level/product definitions, (2) force majeure/uncontrollable force definitions, and (3) other terms as mutually agreed shall have the meaning Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: July 2, 2002 Effective: September 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 52A ascribed to them in the different agreement or in the applicable confirmation 32.7 notice or agreement. Written confirmation pursuant to this Section 32 may be provided in electronic format so long as the Parties to the affected transaction or transactions have 33. agreed on the procedures and format for doing so. PERFORMANCE, TITLE, AND WARRANTIES FOR TRANSACTIONS UNDER SERVICE SCHEDULES: 33.1 Performance 33.1.1 The Seller shall deliver to the delivery point(s) as agreed to in the applicable Confirmation Agreement and sell to the Purchaser in accordance with the terms of the Agreement and such Confirmation Agreement. 33.1.2 The Purchaser shall receive and purchase the Contract Quantity, as agreed to by the Parties in the applicable Confirmation Agreement, at the delivery point(s) and purchase from the Seller in accordance with the terms of the Agreement and such Confirmation Agreement. 33.2 Title and Risk of Loss Title to and risk of loss of the electric energy shall pass from the Seller to the Purchaser at the delivery point agreed to in the Confirmation Agreement; provided, however, with regard to federal agencies or parts of the United States Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 53 Government, title to and risk of loss shall pass to Purchaser to the extent permitted by and consistent with applicable law. 33.3 Warranties The Seller warrants that it will transfer to the Purchaser good title to the electric energy sold under the Agreement and any Confirmation Agreement, free and clear of all liens, claims, and encumbrances arising or attaching prior to the delivery point and that Seller's sale is in compliance with all applicable laws and regulations. THE SELLER HEREBY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 34. DISPUTE RESOLUTION: 34.1 INFORMAL DISPUTE RESOLUTION Before binding dispute resolution or any other form of litigation may proceed, any dispute between the Parties to a transaction under this Agreement first shall be referred to nonbinding mediation. The Parties shall attempt to agree upon a mediator from a list of ten (10) candidates provided by the Chairman of the WSPP Operating Committee or his or her designee. If the Parties are unable to agree, then the Chairman or the designee shall appoint a mediator for the dispute. Neither the mediator nor the person involved on behalf of the WSPP in developing a list of mediators for the Parties to choose from or in selecting the Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 54 mediator (if the Parties are unable to do so) shall possess a direct or indirect interest in either Party or the subject matter of the mediation. The WSPP shall establish procedures for the appointment of mediators and the conduct of mediation and those procedures shall apply to the mediation. 34.2 BINDING DISPUTE RESOLUTION The Parties to a dispute may elect binding dispute resolution using the following process unless binding arbitration of certain disputes is required under this Agreement in which event the Parties shall use the process set forth in this Section 34.2 to resolve such disputes, unless the Parties otherwise agree: (a) WSPP Dispute Resolution: A Party .to a dispute (if binding dispute resolution is required) or all Parties to a dispute (if agreement of the Parties is required for binding dispute resolution) may initiate binding dispute resolution under WSPP procedures by notifying the Chairman of the WSPP Operating Committee or his or her designee. The Chairman or his or her designee shall provide the Parties with a list of ten (10) eligible arbitrators. Within ten (10) days of receiving the list, the Parties shall agree on a single arbitrator from the list to conduct the arbitration, or notify the Chairman of the Operating Committee or the designee of their inability to reach agreement. If notified of the Parties inability to reach agreement, then the Chairman or the designee shall choose the arbitrator from the list within five (5) days. Neither the arbitrator nor the person Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 55 involved on behalf of the WSPP in developing a list of arbitrators for the Parties to choose from or in selecting the arbitrator (if the Parties are unable to do so) shall possess a direct or indirect interest in either Party or the subject matter of the arbitration. The Procedures to be used for this arbitration shall follow the arbitration procedures which shall be developed and maintained by the WSPP and the procedures will be generally consistent with the commercial arbitration rules of the American Arbitration Association though not involving the Association. If the Parties agree to binding dispute resolution under this Section 34.2, each Party understands that it will not be able to bring a lawsuit concerning any dispute that may arise which is covered by this arbitration provision. Notwithstanding the foregoing, nothing herein is intended to waive any provision of the Federal Arbitration Act, 9 U.S.C. § 1, et. seq., or any right under state statute or common law to challenge an arbitration award or to prevent any action to enforce any arbitration award. A Party's liability and damages under any arbitration award resulting from the process set forth in this Section 34.2 shall be limited as provided in this Agreement or in any Confirmation Agreement. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 56 34.3 COSTS Each Party shall be responsible for its own costs and those of its counsel and representatives. The Parties shall equally divide the costs of the arbitrator or mediator and the hearing. 34.4 CONFIDENTIALITY Any arbitration or mediation under this Section 34 shall be conducted on a confidential basis and not disclosed, including any documents or results which shall be considered confidential, unless the Parties otherwise agree or such disclosure is required by law. 35. FORWARD CONTRACTS: The Parties acknowledge and agree that all transactions under the Agreement and Confirmation Agreement(s) are forward contracts and that the Parties are forward contract merchants, as those terms are used in the United States Bankruptcy Code. The Parties acknowledge and agree that all of their transactions, together with this Agreement and the related Confirmation Agreement(s) form a single, integrated agreement, and agreements and transactions are entered into in reliance on the fact that the agreements and each transaction form a single agreement between the Parties. 36. TRADE OPTION EXCEPTION The Parties intend that any Physically Settled Option under this Agreement shall qualify under the trade option exception, 17 C.F.R. § 32.4. Accordingly, each Party buying or selling a Physically Settled Option agrees and warrants that any such option Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 57 shall be offered only to a provider, user, or merchant and that the entities entering into the options are doing so solely for purposes related to their business. 37. ADDITIONAL REPRESENTATIONS AND WARRANTIES: Each Party warrants and represents to the other(s) that it possesses the necessary corporate, governmental and legal authority, right and power to enter into and agree to the applicable Confirmation Agreement for a transaction or transactions and to perform each and every duty imposed, and that the Parties' agreement to buy and sell power under this Agreement and the Confirmation Agreement represents a contract. Each Party also warrants and represents to the other(s) that each of its representatives executing or agreeing through a Confirmation Agreement to a transaction under this Agreement is authorized to act on its behalf. Each Party further warrants and represents that entering into and performing this Agreement and any applicable Confirmation Agreement does not violate or conflict with its Charter, By-laws or comparable constituent document, any law applicable to it, any order or judgment of any court or other agency of government applicable to it or any agreement to which it is a party and that this Agreement and applicable Confirmation Agreement(s), constitute a legal, valid and binding obligation enforceable against such Party in accordance with the terms of such agreements. Each Party also represents that it is solvent and that on each delivery this representation shall be deemed renewed unless notice to the contrary is given in writing by the Purchaser to the Seller before delivery. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 58 Superseding Original Sheet No. 58 38. FLOATING PRICES: 38.1 In the event the Parties intend that the price for a transaction is to be based on an index, exchange or any other kind of variable reference price (such price being a "Floating Price"), the Parties shall specify the "Floating Price" to be used to calculate the amounts in a Confirmation Agreement due Seller for that transaction. 38.2 Market Disruption. If a Market Disruption Event has occurred and is continuing during the Determination Period, the Floating Price for the affected Trading Day shall be determined as follows. The Parties shall negotiate in good faith to agree on a Floating Price (or a method for determining a Floating Price) for the affected Trading Day. If the Parties have not so agreed on or before the twelfth Business Day following the first Trading Day on which the Market Disruption Event occurred or existed, then the Floating Price shall be determined in good faith by the Parties based upon (1) quotes from Dealers in energy contracts; and/or (2) quotes from Brokers in energy contracts. Each Party may obtain up to a maximum of four quotes which must be provided to the other Party no later than twenty-two Business Days following the first Business Day on which the Market Disruption Event occurred or existed. These quotes shall reflect transacted prices. The Floating Price for the affected Trading Day shall equal a simple average of the quotes obtained and provided by the Parties consistent with the provisions of this Section 38. Each Party providing quote(s) to the other Party also shall Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 58A 38.3 identify to that other Party the Dealer(s) and/or the Broker(s) who provided each of the quotes to allow verification. "Determination Period" means each calendar month during the term of the relevant transaction; provided that if the term of the transaction is less than one calendar month the Determination Period shall be the term of the transaction. "Market Disruption Event" means, with respect to an index, any of the following events (the existence of which shall be determined in good faith by the Parties): (a) the failure of the index to announce or publish information necessary for determining the Floating Price; (b) the failure of trading to commence or the permanent discontinuation or material suspension of trading in the relevant options contract or commodity on the exchange or market acting as the index; (c) the temporary or permanent discontinuance or unavailability of the index; (d) the temporary or permanent closing of any exchange acting as the index; or (e) a material change in the formula for or the method of determining the Floating Price. "Trading Day" means a day in respect of which the relevant price source published the relevant price or would have published the relevant price but for the Market Disruption Event. Calculation of Floating Price. For the purposes of the calculation of a Floating Price, all numbers shall be rounded to three (3) decimal places. If the fourth (4th) decimal number is five (5) or greater, then the third (3rd) decimal number shall be Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 58B Superseding Original Sheet No. 58B 39. Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 increased by one (1), and if the fourth (4th) decimal number is less than five (5), then the third (3rd) decimal number shall remain unchanged. 38.4 Corrections. For the purposes of determining the relevant prices for any day, if the price published or announced on a given day and used or to be used to determine the relevant price is subsequently corrected and the correction is published or announced by the person responsible for that publication or announcement, either Party may notify the other Party of (i) that correction and (ii) the amount (if any) that is payable as a result of that correction. If a Party gives notice that an amount is so payable, the Party that originally either received or retained such amount will pay such amount consistent with the provisions of this Section 38.4. The amount that is payable as a result of the correction shall be included in the billing cycle in which the notice of the correction is provided. AMENDMENT: 39.1 This Agreement may be amended upon the submission to FERC and acceptance by FERC of that amendment. The Parties through the Executive Committee shall direct the filing of any amendments. The Parties to this Agreement agree to bound by this Agreement as it may be amended, provided that the Parties possess the right to challenge any amendments at FERC and to exercise any applicable withdrawal rights under this Agreement. 39.2 Unless otherwise stated in the amendment, all amendments shall apply only to new transactions entered into or agreed to on or after the effective date of the amendment. Preexisting agreements and transactions shall operate under the Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 58C version of the WSPP Agreement effective at the time of the agreement for the transaction unless the Parties to a transaction or transactions mutually agree otherwise. 39.3 An agreement modifying this Agreement or a Confirmation Agreement for a transaction needs no consideration to be binding. 40. EXECUTION BY COUNTERPARTS: This Agreement may be executed in any number of counterparts, and upon execution by all Parties, each executed counterpart shall have the same force and effect as Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 3, 2002 Effective: February 1, 2003 Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 59 Superseding Original Sheet No. 59 an original instrument and as if all Parties had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages. 41. WITNESS: IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representative as of the 27th day of July, 1991 (or as of the date of execution of this Agreement by each Party's duly authorized representation, in the case of any Party that becomes a signatory to this Agreement subsequent to July 27, 1991). By: Name: Title: wspp\WSPP Agreement June 03 Revisions to 2-1-03.doc Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 60 EXHIBIT A NETTING Each Party that executes this Exhibit A to the Agreement agrees to net payments for transactions under WSPP Service Schedule A, B, and C with any other Party or Parties which also have agreed to net payments by executing a copy of this Exhibit A. The Party executing this Exhibit A shall indicate below when it desires that its agreement to net becomes effective. A Party agreeing to net under this Exhibit A shall comply with the provisions of Section 28.2 of the Agreement. Defined terms used herein are as defined in the WSPP Agreement. Netting shall be done in accordance with the following provision: If the Purchaser and Seller are each required to pay an amount on the payment due date in the same month for transactions under the Agreement or Confirmation Agreement, then such amounts with respect to each Party will be aggregated and the Parties will discharge their obligations to pay through netting, in which case the Party owing the greater aggregate amount will pay to the other party the difference between the amounts owed consistent with the payment times in Section 9.2 of the Agreement, unless the Parties have otherwise agreed to a different payment time as allowed by the Agreement. Each Party reserves to itself all rights, set-offs, counterclaims and other remedies and/or defenses to which it is or may be entitled, arising from or out of the Agreement. All outstanding payments between the Parties which are to be netted pursuant to this Exhibit A for transactions under WSPP Service Schedule A, B, and C shall be offset against each other or set off or recouped therefrom. Name of Authorized Representative Effective Date for Netting Name of WSPP Member Signature of Authorized Representative Date of Execution Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 61 [WSPP SAMPLE FORM- PARTIES ARE FREE TO USE THIS OR DISREGARD lT.] EXHIBIT B FORM OF COUNTERPARTY GUARANTEE AGREEMENT This Guarantee Agreement (this "Guarantee"), dated, as of [ ], 199[__], is made and entered into by [ ], a [ ] corporation ("Guarantor"). WITNESSETH: WHEREAS, [ ] (the "Company") may enter into transactions involving power sales under the Western Systems Power Pool ("WSPP Agreement") and related confirmation agreements~ (collectively "Agreements") with [Company Name] ("Guaranteed Party"); and WHEREAS, Guarantor will directly or indirectly benefit from the Agreements. NOW THEREFORE, in consideration of the Guaranteed Party agreeing to conduct business with Company, Guarantor hereby covenants and agrees as follows: 1. GUARANTY. Subject to the provisions hereof, Guarantor hereby irrevocably and unconditionally guarantees the timely payment when due of the obligations of Company (the "Obligations") to the Guaranteed Party in accordance with the Agreements. If Company fails to pay any Obligations, Guarantor shall promptly pay to the Guaranteed Party no later than the next Business Day (as defined in the WSPP Agreement), after notification, the amount due in the same currency and manner provided for in the Agreements. This Guarantee shall constitute a guarantee of payment and not of collection. Guarantor shall have no right of subrogation with respect to any payments it makes under this Guarantee until all of the Obligations of Company to the Guaranteed Party are paid in full. The liability of Guarantor under the Guarantee shall be subject to the following: (a) Guarantor's liability hereunder shall be and is specifically limited to payments expressly required to be made in accordance with the Agreements (even if such payments are deemed to be damages) and, except to the extent specifically provided in the Agreements, in no event shall Guarantor be subject hereunder to consequential, exemplary, equitable, loss of profits, punitive, tort, or any other even if such fees together with the payments Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 62 exceed the cap in Section 1 (b), damages, costs, except that Guarantor shall be required to pay reasonable attorney fees. (b) The aggregate liability of the Guarantor shall not exceed [.~] Million U.S. Dollars [ ]. 2. DEMANDS AND NOTICE. If Company fails or refuses to pay any Obligations, the Guaranteed Party may make a demand upon Guarantor (hereinafter referred to as a "Payment Demand"). A Payment Demand shall be in writing and shall reasonably and briefly specify in what manner and what amount Company has failed to pay and an explanation of why such payment is due, with a specific statement that the Guaranteed Party is calling upon Guarantor to pay under this Guarantee. A Payment Demand satisfying the foregoing requirements shall be deemed sufficient notice to Guarantor that it must pay the Obligations. A single written Payment Demand shall be effective as to any specific default during the continuance of such default, until Company or Guarantor has cured such default, and additional Payment Demands concerning such default shall not be required until such default is cured. o that: REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants (a) it is a corporation duly organized and validly existing under the laws of the State of [. .] and has the corporate power and authority to execute, deliver and carry out the terms and provisions of this Guarantee; (b) no authorization, approval, consent or order of, or registration or filing with, any court or other governmental body having jurisdiction over Guarantor is required on the part of Guarantor for the execution and delivery of this Guarantee; and (c) this Guarantee constitutes a valid and legally binding agreement of Guarantor enforceable against Guarantor in accordance with its terms, except as the enforceability of this Guarantee may be limited by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors' rights generally and by general principles of equity. 4. EFFECT OF BANKRUPTCY BY COMPANY. The Guarantor's obligation to pay under this Guarantee shall not be affected in any way by the institution with respect to the Company of a bankruptcy, reorganization, moratorium or similar insolvency proceeding or other relief under any bankruptcy or insolvency law affecting creditor's rights or a petition for the Company's winding-up or liquidation. 5. AMENDMENT. No term or provision of this Guarantee shall be amended, modified, altered, waived, or supplemented except in a writing signed by the Guarantor and Guaranteed Party hereto. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 63 6. WAIVERS. Guarantor hereby waives (a) notice of acceptance of this Guarantee; (b) presentment and demand concerning the liabilities of Guarantor, except as expressly hereinabove set forth; and (c) any right to require that any action or proceeding be brought against Company or any other person, or except as expressly hereinabove set forth, to require that the Guaranteed Party seek enforcement of any performance against Company or any other person, prior to any action against Guarantor under the terms hereof. Except as to applicable statutes of limitation, no delay of the Guaranteed Party in the exercise of, or failure to exercise, any rights hereunder shall operate as a waiver of such rights, a waiver of any other rights or a release of Guarantor from any obligations hereunder. Guarantor consents to the renewal, compromise, extension, acceleration or other changes in the time of payment of or other changes in the terms of the Obligations, or any part thereof or any changes or modifications to the terms of the Agreements. Guarantor may terminate this Guarantee by providing written notice of such termination to the Guaranteed Party and upon the effectiveness of such termination, Guarantor shall have no further liability hereunder, except as provided in the last sentence of this paragraph. No such termination shall be effective until fifteen (15) Business Days after receipt by the Guaranteed Party of such termination notice. No such termination shall affect Guarantor's liability with respect to any obligations arising under any transaction entered into prior to the time the termination is effective, which transaction shall remain guaranteed pursuant to the terms of this Guarantee. 7. ASSIGNMENT. The Guarantor shall not assign this Guarantee without the express written consent of the Guaranteed Party. The Guaranteed Party shall be entitled to assign its rights under this Agreement in its sole discretion. 8. NOTICE. Any Payment Demand, to the Guaranteed Party or the Guarantor notice, request, instruction, correspondence or other document to be given hereunder by any party to another (herein collectively called "Notice") shall be in writing and delivered personally or mailed by certified mail, postage prepaid and return receipt requested, or by telegram or telecopier, as follows: Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 To [Name of Guaranteed Party] Original Sheet No. 64 To Guarantor: Attn: Fax No.: ( ) Attn: Fax No.: ( ) Notice given by personal delivery or mail shall be effective upon actual receipt. Notice given by telegram or telecopier shall be effective upon actual receipt if received during the recipient's normal business hours, or at the beginning of the recipient's next business day after receipt if not received during the recipient's normal business hours. All Notices by telegram or telecopier shall be confirmed promptly after transmission in writing by certified mail or personal delivery. Any party may change any address to which Notice is to be given to it by giving notice as provided above of such change of address. 8. MISCELLANEOUS. THIS GUARANTEE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF [State], WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. This Guarantee shall be binding upon Guarantor, its successors and assigns and inure to the benefit of and be enforceable by the Guaranteed Party, its successors and assigns. The Guarantee embodies the entire agreement and understanding between Guarantor and the Guaranteed Party and supersedes all prior agreements and understandings relating to the subject matter hereof. The headings in this Guarantee are for purposes of reference only, and shall not affect the meaning hereof. This Guarantee may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. EXECUTED as of the day and year first above written. [ ] By: Name: Title: Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Second Revised Sheet No. 65 Superseding First Revised Sheet No. 65 EXHIBIT C SAMPLE FORM FOR CONFIRMATION 1. Transaction Specific Agreements The undersigned Parties agree to sell and purchase electric energy, or a Physically-Settled Option, pursuant to the WSPP Agreement as it is supplemented and modified below: (a) (b) (c) (d) (e) (f) (g) (h) (i) (J) (k) (1) (m) Seller: Purchaser: Period of Delivery: From \ \ To \ \ Schedule (Days and Hours): Delivery Rate: Delivery Point(s): Type of Service (Check as Applicable) Service Schedule A Service Schedule B Service Schedule C Physically-Settled Option Service Schedule B __ Physically-Settled Option Service Schedule C __ Other products per Section 32.6 Contract Quantity: Total MWhrs. Contract or Strike Price: Transmission Path for the Transaction (If Applicable): Date of Agreement if different: Additional Information for Physically-Settled Options (i) Option Type: Put Call (ii) Option Style: (iii) Exercise Date or Period: (iv) Premium: (v) Premium Payment Date: (vi) Method for providing notice of exercise Special Terms and Exceptions: See Attachment A [Describe Product] [Special Terms and Exceptions shall be shown on an Attachment to this Confirmation.] Name of Trader for Purchaser Name of Trader for Seller Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 66 Authorized Signature for Purchaser Authorized Signature for Seller Date Date Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 67 EXHIBIT D WSPP MEDIATION AND ARBITRATION PROCEDURES I. MEDIATION A. Informal Mediation. WSPP members with a dispute or a potential dispute involving transactions under the WSPP Agreement may request non-binding, informal mediation by contacting the WSPP's General Counsel and by providing a brief explanation in writing of the dispute and the remedy being sought. All parties to the dispute must request this Informal Mediation for it to become effective. After this contact, a telephonic conference call will be arranged among the affected WSPP members and the WSPP's General Counsel, the Chairman of the Operating Committee, and/or some other independent and knowledgeable person requested by the Chairman of the Operating Committee to participate. The purpose of the conference call will be to discuss the issues and to have an independent person or persons state their views. Best efforts will be made to set up this conference call within five Business Days after the WSPP's General Counsel is contacted subject to accommodating the schedules of all involved. This Informal Mediation shall be considered as satisfying the Mediation requirements of Section 34.1 of the WSPP Agreement. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 68 B. Initiating Formal Mediation. A WSPP member which believes that it possesses a claim against another WSPP member relating to a WSPP transaction, which is unable to resolve the dispute through agreement with the other member to the transaction, and which desires to pursue that claim shall initiate non-binding formal mediation pursuant to Section 34.1 of the WSPP Agreement. The member initiating such mediation shall do so by Serving written notice to the Chairman of the WSPP Operating Committee, the WSPP's General Counsel, and the other members against which the claim is directed. Such notice shall state the nature of the dispute, the remedy sought, and support the claim. C. Response to Document Initiating Formal Mediation. Within eight days, the member or members against which the claim is directed may provide a response to the notice which shall be Served on the member which initiated the Mediation, the Chairman of the WSPP's Operating Committee, and the WSPP's General Counsel. D. Choosing the Mediator. The Mediator shall be chosen in accordance with the procedures set forth in Section 34.1 of the WSPP Agreement. Each Party may suggest persons to be included on the list of Mediators to be presented to the Parties provided that these suggested persons shall be provided to the WSPP Representative together with relevant personal histories within two Business Days Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 69 of the date by which time the list of Mediators is to be sent out. The WSPP Representative shall allow at least one person suggested by each Party to be added to the list of Mediators. A brief personal history of each person on the list of potential mediators shall be provided to the Parties, with that history showing the person's employment over the last five years and any other relevant facts. The WSPP Representative shall provide the Parties with the list of Mediators within five days of receipt of notice of the dispute. The Parties then shall have five days in which to reach agreement on a Mediator or inform the WSPP Representative that they were unable to reach agreement in which event the WSPP Representative shall appoint the Mediator consistent with Section 34.1 of the WSPP Agreement. Upon request of the Parties for expedition, the WSPP Representative shall use best efforts to expedite this process. E. Location for the Formal Mediation. The Parties shall agree on a location for the Mediation. If the Parties fail to reach agreement, then the WSPP Representative shall set the location which shall be convenient for the Parties and the Mediator. F. Time for the Formal Mediation. The Parties shall agree on the time for the Mediation after consultation with the Mediator if one has been appointed. If the Parties fail to reach agreement, then the WSPP Representative shall set the time Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 70 which shall not be more than twenty-one days after the notice initiating the Mediation is received after consultation with the Parties and any Mediator. G. Conduct of the Formal Mediation. The Mediator shall have the ability to conduct the Mediation in any manner which the Mediator believes is appropriate to facilitate resolution of the dispute. Each Party shall have at least one representative with the authority to settle the dispute present at the Mediation. The Mediation shall be private and confidential and the Mediator shall have the authority to exclude any person not directly involved unless the Parties agree otherwise in writing. At the Mediation, each Party shall have the right to make a brief presentation of its case and to question the other Party. Each Party also may be represented by counsel. H. Replacement of the Mediator. If the Mediator resigns, withdraws or is no longer able to serve, then the Parties shall have two Business Days in which to agree on a new Mediator. If the Parties are unable to agree within such time, the WSPP Representative shall appoint a replacement Mediator from the list used to select the first Mediator within two Business Days after being notified that the Parties are unable to agree. The dates and deadlines in this section may require modification if the mediator is replaced. Any extensions shall be as limited as possible. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 71 II. ARBITRATION A. Initiating Arbitration. A WSPP member which initiates Arbitration pursuant to Section 34.2 of the WSPP Agreement shall do so by Serving the Chairman of the WSPP Operating Committee, the WSPP General Counsel and the members against which the claim is directed with written notice of its demand for arbitration. Such notice shall state the nature of the dispute, the remedy sought, and support the claim. B. Response. Within ten days of receipt of the notice, any member or members against which the claim is directed may provide a response to the notice. Such response must include any counterclaims which the member believes are appropriate. If a counterclaim is submitted, then the member which submitted the notice may respond to the counterclaim within ten days of receipt. All such responses shall be Served on the Parties, the Chairman of the WSPP Operating Committee, and the WSPP General Counsel. C. Choosing the Arbitrator. The Arbitrator shall be chosen in accordance with the procedures set forth in Section 34.2 of the WSPP Agreement. Each Party may suggest persons to be included on the list of Arbitrators to be presented to the Parties provided that these suggested persons are provided to the WSPP Representative together with relevant personal histories within two business days Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 72 of the date by which time the list of Arbitrators is to be sent out. The WSPP Representative shall allow at least one person suggested by each Party to be added to the list of potential Arbitrators. A brief personal history of each person on the list of potential Arbitrators shall be provided to the Parties, with that history showing the person's employment over the last five years and any other relevant facts. The WSPP Representative shall provide the Parties with the list of Arbitrators within seven days of receipt of notice of the request for Arbitration. The Parties then shall have ten days in which to reach agreement on the Arbitrator or to inform the WSPP Representative that they were unable to reach agreement in which event the WSPP Representative shall appoint the Arbitrator consistent with Section 34.2 of the Agreement. Upon request of the Parties for expedition, the WSPP Representative shall use best efforts to cause this process to be expedited. D. Location for the Arbitration. The Parties shall agree on a location for the Arbitration. If the Parties fail to reach agreement, then the WSPP Representative shall set the location which shall be convenient for the Parties and the Arbitrator. E. Time for the Arbitration. The Parties shall agree on the time for the Arbitration and coordinate that time with the Arbitrator if one has been agreed to or appointed. If the Parties fail to reach agreement, then the WSPP Representative Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 73 shall set the time which shall not be more than 60 days after the notice is received. The WSPP Representative shall set a time after consultation with the Parties and the Arbitrator to check their schedules. F. Discovery. After appointment of the Arbitrator, each Party shall be entitled to obtain relevant documents from the other Parties and to take depositions. Each Party shall respond to such a document request within seven days of receipt of the request and make its employees or consultants available for depositions to the extent that the employee or consultant possesses knowledge and information relevant to the dispute. Each Party shall disclose documents that are confidential or commercially sensitive subject to a reasonable protective order. Any disputes concerning discovery shall be promptly referred to the Arbitrator who shall have authority to resolve such disputes, including the authority to require attendance of witnesses at depositions. The Federal Rules of Civil Procedure shall apply to discovery under these procedures. G. Conduct of Arbitration if the Parties Agree to Waive an Oral Hearing. If the Parties agree to waive an oral hearing, then the Parties shall Serve Initial Briefs no later than 35 days after the notice is received or notify the Arbitrator that they do not wish to submit any additional documents. Parties shall Serve any Reply Briefs no later than ten days after the date for Service of Initial Briefs. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 74 H. Conduct of the Arbitration Hearing. No later than fifteen days before any hearing, any Party may Serve an Initial Brief or notify the Arbitrator that they do not wish to submit any additional documents. A Party shall Serve any Reply Brief no later than five Business Days before any hearing. The Arbitrator shall preside over any hearing and rule on all objections including objections as to the admissibility of evidence or whether the questioning is proper. All testimony shall be submitted under oath. The Arbitrator is not bound to follow any particular rules governing the conduct of the proceeding. The Arbitrator may rely on legal advice provided through the WSPP. The Arbitrator may require any person employed by a Party to attend and testify at the hearing. Each Party shall possess the right to present evidence, including witnesses, and to cross-examine other Parties' witnesses. The Arbitration shall be private and the Arbitrator shall have the authority to exclude any person not directly involved unless the Parties otherwise agree. Each Party may be represented by counsel. A stenographic record of the Arbitration shall be kept. I. Decision. Within ten Business Days after the end of the Arbitration hearing, the Arbitrator shall issue his award in writing. If the Parties waived the right to an oral hearing, then the Arbitrator shall issue the award within ten Business Days of the last date Briefs were to be submitted. The Arbitrator is not limited in the Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 75 remedies he may order so long as any arbitration award is consistent with the provisions and limitations of the WSPP Agreement and any applicable Confirmation Agreement with respect to the liability and damages of any Party; provided, however, upon agreement of the Parties to the dispute, the Arbitrator's choice of remedies may be limited. J. Replacement of the Arbitrator. If the Arbitrator resigns, withdraws, or is no longer able to serve then the Parties shall have two Business Days in which to agree on a new Arbitrator. If the Parties are unable to agree within such time, the WSPP Representative shall appoint a replacement Arbitrator from the list used to select the first Arbitrator within two Business Days after being notified that the Parties are unable to agree. The dates and deadlines in this section may require modification if the mediator is replaced. Any extensions shall be as limited as possible. III. MISCELLANEOUS A. Confidentiality. Any Arbitration or Mediation shall be confidential as provided in Section 34.4 of the WSPP Agreement. B. Costs. Costs shall be borne by Parties as provided in Section 34.3 of the WSPP Agreement. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 76 C. Restrictions on Lawsuits. Each Party shall be subject to the restrictions provided in Section 34.2 of the WSPP Agreement. D. Attorney-Client/Attorney Workproduct. The Arbitrator or Mediator shall not take any action which would result in disclosure of information in violation of the attorney-client privilege or attorney workproduct doctrine. IV. DEFINITIONS A. Arbitrator or Arbitration. The Arbitrator appointed pursuant to these procedures and Section 34.2 of the WSPP Agreement and the Arbitration pursuant to these procedures and the WSPP Agreement. Bo Initial or Reply Briefs. Written documents submitted by the Parties to support their positions and respond to each others positions. Such documents shall be limited to 25 pages. C. Business Days. Defined as in the WSPP Agreement. D. Mediator or Mediation. The Mediator appointed pursuant to these procedures and Section 34.1 of the WSPP Agreement and the Mediation pursuant to these procedures and the WSPP Agreement. E. Parties. The WSPP members involved in the Mediation or Arbitration which have a direct interest in the dispute. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 77 F. Service, Serving, or Served. The method of service shall be by fax, unless impracticable because of the size of the document. In all events, the document should be delivered to the Party by overnight mail. Parties also should attempt to send the document out by email if possible. Service will be accomplished to a Party if sent to the Party's contact person for the disputed transaction. If there are multiple contact persons for one Party, service to one such person shall suffice. Service shall be to those individuals or entities specified in this procedures, but must include service to the Parties, the Mediator or Arbitrator (if either has been appointed), and to the WSPP General Counsel. G. WSPP Representative. The Chairman of the WSPP Operating Committee or his or her designee for the purposes of the Arbitration or Mediation. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 78 SERVICE SCHEDULE A ECONOMY ENERGY SERVICE A-1 PARTIES: This Service Schedule is agreed upon as a part of this Agreement by the Parties. A-2 PURPOSE: The purpose of this Service Schedule is to define additional specific procedures, terms and conditions for requesting and providing Economy Energy Service. A-3 TERMS: A-3.1 A Party may schedule Economy Energy Service from another Party by mutual agreement; provided, however, that each Party shall be the sole judge as to the extent to and the conditions under which it is willing to provide or receive such service hereunder consistent with statutory requirements and contractual commitments including the Agreement and any applicable Confirmation Agreement. A-3.2 Scheduling of Economy Energy Service hereunder shall be a responsibility of the Parties involved. A-3.3 Each Seller/Purchaser may prepare a daily estimate of the amount of Economy Energy Service that it is willing and able to sell/buy each hour and the associated hourly sale/purchase price for the next Business Day, plus the weekend and Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 79 holidays, and communicate this information to all other Parties via the Hub. A-3.4 Purchasers shall arrange purchases directly with Sellers, and shall be responsible for transmission arrangements. A-3.5 Unless otherwise mutually agreed between the Purchaser and the Seller, all Economy Energy Service transactions shall be pre-scheduled, and billings shall be based on amounts and prices agreed to in advance by schedulers, subject to Paragraphs A-3.6 and 3.7 and subject to change by mutual agreement between dispatchers or schedulers due to system changes. A-3.6 The price for Economy Energy Service shall be mutually agreed to in advance between Seller and Purchaser and shall not be subject to the rate caps specified in Section A-3.7 in either of the following two circumstances: (1) where the Seller is a FERC regulated public utility and that Seller has been authorized to sell power like that provided for under this Service Schedule at market-based rates; or (2) where the Seller is not a FERC regulated public utility. A Party is a FERC regulated public utility if it is a "public utility" as defined in Section 201 (e) of the Federal Power Act, 16 U.S.C. § 824(e). A-3.7 Except as provided for in Section A-3.6, the price shall not exceed the Seller's forecasted Incremental Cost plus up to: $7.32/kW/ month; $1.68/kW/week; Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 80 33.78C/kW/day; 14.07 mills/kWh; or 21.11 mills/kWh for service of sixteen (16) hours or less per day. The hourly rate is capped at the Seller's forecasted Incremental Cost plus 33.78¢/kW/day. The total demand charge revenues in any consecutive seven-day period shall not exceed the product of the weekly rate and the highest demand experienced on any day in the seven-day period. In lieu of payment, such Parties may mutually agree to exchange economy energy at a ratio not to exceed that ratio provided for in Section C-3.7 of Service Schedule C. The Seller's forecasted Incremental Cost discussed above also may include any transmission and/or ancillary service costs associated with the sale, including the cost of any transmission and/or ancillary services that the Seller must take on its own system. Any such transmission and/or ancillary services charges shall be separately identified by the Seller to the Purchaser for transactions under this Schedule including the exchange of economy energy. The transmission and ancillary service rate ceilings shall be available through the WSPP's Hub or homepage. Any such transmission services (and ancillary service provided in conjunction with such transmission service) by Seller shall be provided pursuant to any applicable transmission tariff or agreement, and the rates therefore shall be consistent with such tariff or agreement. A-3.8 Unless otherwise agreed, the Purchaser shall be responsible for maintaining Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 81 operating reserve requirements as back-up for Economy Energy Service purchased and the Seller shall not be required to maintain such operating reserve. A-3.9 Each Party that is a FERC regulated public utility as defined in A-3.6 shall file the Confirmation Agreement with FERC for each transaction under this Service Schedule with a term in excess of one year no later than 30 days after service begins if that Party would have been required to file such Confirmation Agreements or similar agreements with FERC under an applicable FERC accepted market based rate schedule. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 B- 1 PARTIES: B-2 SERVICE SCHEDULE B Original Sheet No. 82 UNIT COMMITMENT SERVICE This Service Schedule is agreed upon as part of this Agreement by the Parties. PURPOSE: The purpose of this Service Schedule is to define additional specific procedures, terms, and conditions for requesting and providing Unit Commitment Service. A Party may schedule Unit Commitment Service from another Party by mutual agreement; provided, however, that each Party shall be the sole judge as to the extent to and the conditions under which it is willing to provide or receive such B-3 TERMS: service hereunder consistent with statutory requirements and contractual B-3.1 commitments including the Agreement and any applicable Confirmation Agreement. Once an agreement is reached, then the obligation for Unit Commitment Service becomes a firm commitment, for both Parties, for the agreed capacity and terms. Unless otherwise mutually agreed by the Parties involved in a Unit Commitment Service transaction, the terms set forth in this Service Schedule B shall govern such transaction. B-3.2 Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 83 B-3.3 Unless otherwise agreed between the Purchaser and the Seller, all transactions shall be prescheduled, subject to any conditions agreed to by schedulers, for a specified unit for a specified period of time. B-3.4 Purchasers shall arrange purchases directly with Sellers. B-3.5 The price for Unit Commitment Service shall be mutually agreed to in advance between Seller and Purchaser and shall not be subject to the rate caps specified in Section B-3.6 in either of the following two circumstances: (1) where the Seller is a FERC regulated public utility and that Seller has been authorized to sell power like that provided for under this Service Schedule at market-based rates; or (2) where the Seller is not a FERC regulated public utility. A Party is a FERC regulated public utility if it is a "public utility" as defined in Section 201 (e) of the Federal Power Act, 16 U.S.C. § 824(e). B-3.6 Except as provided for in Section B-3.5, the price shall not exceed the Seller's forecasted Incremental Cost plus up to: $7.32/kW/month; $1.68/kW/week; 33.78C/kW/day; 14.07 mills/kWh; or 21.11 mills/kWh for service of sixteen (16) hours or less per day. The hourly rate is capped at the Seller's forecasted Incremental Cost plus 33.78C/kW/day. The total demand charge revenues in any consecutive seven-day period shall not exceed the product of the weekly rate and the Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 84 highest demand experienced on any day in the seven-day period. The Seller's forecasted Incremental Cost discussed above also may include any transmission and/or ancillary service costs associated with the sale, including the cost of any transmission and/or ancillary services that the Seller must take on its own system. Any such transmission and/or ancillary service charges shall be separately identified by the Seller to the Purchaser. The transmission and ancillary service rate ceilings shall be available through the WSPP's Hub or homepage. B-3.7 Start-up costs and no-load costs if included by the Seller shall be stated separately in the price. B-3.8 Energy schedules for the Purchaser's share of a unit may be modified by the Purchaser with not less than a thirty (30) minute notice before the hour in which the change is to take place, unless otherwise mutually agreed or unforeseen system operating conditions occur. B-3.9 Unit Commitment Service is intended to have assured availability; however, scheduled energy deliveries may be interrupted or curtailed as follows: (a) By the Seller by giving proper recall notice to the Purchaser if the Seller and the Purchaser have mutually agreed to recall provisions, (b) By the Seller when all or a portion of the output of the unit is unavailable, by an amount in proportion to the amount of the reduction in the output of the Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 85 unit, unless otherwise agreed by the schedulers, (c) By the Seller to prevent system separation during an emergency, provided the Seller has exercised all prudent operating altematives prior to the interruption or curtailment, (d) Where applicable, by the Seller to meet its public utility or statutory obligations to its customers, or (e) By either the Seller or the Purchaser due to the unavailability of transmission capacity necessary for the delivery of scheduled energy. B-3.10 Each Party that is a FERC regulated public utility as defined above in B-3.5 shall file the Confirmation Agreement with FERC for each transaction under this Service Schedule with a term in excess of one year no later than 30 days after service begins if that Party would have been required to file such Confirmation Agreements or similar agreements with FERC under an applicable FERC accepted market based rate schedule. B-4 BILLING AND PAYMENT PROVISIONS: B-4.1 Except as provided in Sections B-4.2 and B-5, billing for Unit Commitment Service shall be computed based upon the agreed upon prices. B-4.2 In the event the Seller requests recall of Unit Commitment Service in a shorter time frame than was mutually agreed pursuant to Section B-3.9(a) and the Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 86 Purchaser agrees to allow such recall, the Purchaser shall be relieved of any obligation to pay start-up costs. B-5 TERMINATION PROVISION: In the event Unit Commitment Service is curtailed or interrupted except as provided in Section B-3.9(a), the Purchaser shall have the option to cancel the Unit Commitment Service at any time by paying the Seller for (i) all energy deliveries scheduled up to the notice of termination and (ii) all separately stated start-up and no-load costs. Issued by: Michael E. Small, General Counsel to Effective: July 1, 2000 Western Systems Power Pool Issued on: September 29, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 C-1 C-2 C-3 C-3.2 First Revised Sheet No. 87 Superseding Original Sheet No. 87 SERVICE SCHEDULE C FIRM CAPACITY/ENERGY SALE OR EXCHANGE SERVICE C-3.3 Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 1, 2000 PARTIES: This Service Schedule is agreed upon as a part of this Agreement by the Parties. PURPOSE: The purpose of this Service Schedule is to define additional specific procedures, terms, and conditions for requesting and providing Firm Capacity/Energy Sale or Exchange Service. TERMS: C-3.1 A Party may schedule Firm Capacity/Energy Sale or Exchange Service from another Party by mutual agreement; provided, however, that each Party shall be the sole judge as to the extent to and the conditions under which it is willing to provide or receive such service hereunder consistent with statutory requirements and contractual commitments including the Agreement and any applicable Confirmation Agreement. Once an agreement is reached, then the obligation for Firm Capacity/Energy Sale or Exchange Service becomes a firm commitment, for both Parties, for the agreed service and terms. Unless otherwise agreed between the Purchaser and the Seller, all transactions shall be prescheduled, subject to any conditions agreed to by schedulers. Firm capacity transactions shall include buying, selling, or exchanging capacity between Parties with or without associated energy. Firm capacity is deemed a capacity sale from the Seller's resources and backed by the Seller's Effective: February 1, 2001 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 C-3.4 C-3.5 C-3.6 C-3.7 First Revised Sheet No. 88 Superseding Original Sheet No. 88 capacity reserves. Firm energy transactions shall include buying, selling, or exchanging firm energy between Parties. Subject to mutual agreement, firm energy is deemed a quantity of energy the Seller has agreed to sell and deliver and the Purchaser has agreed to buy within a specified time period. Purchaser shall arrange purchases directly with Sellers. The price for Firm Capacity/Energy Sale or Exchange Service shall be mutually agreed to in advance between Seller and Purchaser and shall not be subject to the rate caps specified in Section C-3.7 in either of the following two circumstances: (1) where the Seller is a FERC regulated public utility and that Seller has been authorized to sell power like that provided for under this Service Schedule at market-based rates; or (2) where the Seller is not a FERC regulated public utility. A Party is a FERC regulated public utility if it is a "public utility" as defined in Section 201 (e) of the Federal Power Act, 16 U.S.C. § 824(e). Except as provided for in Section C-3.6, the price shall not exceed the Seller's forecasted Incremental Cost plus up to: $7.32/kW/month; $1.68/kW/week; 33.78C/kW/day; 14.07 mills/kWh; or 21.11 mills/kWh for service of sixteen (16) hours or less per day. The hourly rate is capped at the Seller's forecasted Incremental Cost plus 33.78C/kW/day. The total demand charge revenues in any consecutive seven-day period shall not exceed the product of the weekly rate and the Issued by: Michael E. Small, General Counsel to Effective: February 1, 2001 Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool First Revised Sheet No. 89 Rate Schedule FERC No. 6 Superseding Original Sheet No. 89 highest demand experienced on any day in the seven-day period. Exchange ratios among such Parties shall be as mutually agreed between the Purchaser and the Seller, but shall not exceed the ratio of 1.5 to 1.0. The Seller's forecasted Incremental Cost discussed above also may include any transmission and/or ancillary service costs associated with the sale, including the cost of any transmission and/or ancillary services that the Seller must take on its own system. Any such transmission and/or ancillary service charges shall be separately identified by the Seller to the Purchaser for transactions under this Schedule including exchanges. The transmission and ancillary service rate ceiling shall be available through the WSPP's Hub or homepage. Any such transmission service (and ancillary services provided in conjunction with such transmission service) by Seller shall be provided pursuant to any applicable transmission tariff or agreement, and the rates therefore shall be consistent with such tariff or agreement. C-3.8 Firm Capacity/Energy Sale or Exchange Service shall be intermptible only if the interruption is: (a) within the recall time or allowed by other applicable provisions governing interruptions of service under this Service Schedule mutually agreed to by the Seller and the Purchaser, (b) due to an Uncontrollable Force as provided in Section 10 of this Agreement; or (c) where applicable, to meet Seller's public utility or statutory obligations to its customers. If service under this Service Schedule is interrupted under Section C-3.8(a) or (b), neither Seller nor Purchaser shall be obligated to pay any damages under this Agreement or Confirmation Agreement. If service under this Service Schedule is interrupted for any reason Effective: February 1,2001 Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 Original Sheet No. 89A other than pursuant to Section C-3.8(a) or (b), the Non-Performing Party shall be responsible for payment of damages as provided in Section 21.3 of this Agreement or in any Confirmation. Issued by: Michael E. Small, General Counsel to Effective: February 1,2001 Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Westem Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 90 Superseding Original Sheet No. 90 C-3.9 Each Party that is a FERC regulated public utility as defined in Section C-3.6 shall file the Confirmation Agreement with FERC for each transaction under this Service Schedule with a term in excess of one year no later than 30 days after service begins if that Party would have been required to file such Confirmation Agreements or similar agreements with FERC under an applicable FERC accepted market based rate schedule. C-3.10 Seller shall be responsible for ensuring that Service Schedule C transactions are scheduled as firm power consistent with the most recent rules adopted by the applicable NERC regional reliability council. Wspp/Feb 04 Effective Amendments Non-Redlined Issued by: Michael E. Small, General Counsel to Effective: February 1,2001 Western Systems Power Pool Issued on: December 1, 2000 Filed to comply with order of the Federal Energy Regulatory Commission, Docket Nos. ER00-3338, et al., issued September 15, 2000. Western Systems Power Pool Rate Schedule FERC No. 6 First Revised Sheet No. 91 Superseding Original Sheet No. 91 LIST OF MEMBERS ACN Power, Inc. AES NewEnergy, Inc. Allegheny Energy Supply Co., LLC Amerada Hess Corporation Ameren Energy Generating Company American Electric Power Service Corporation as agent for Ohio Power Company, Public Service Company of Oklahoma and Southwestern Electric Power Company APS Energy Services Company, Inc. Aquila Energy Marketing Corporation Arizona Electric Power Co. Arizona Public Service Co. Arkansas Electric Coop. Corp. Associated Electric Cooperative, Inc. Astra Oil Company, Inc. Avista Corporation Avista Energy, Inc. Basin Electric Power Cooperative Benton Public Utility District No. 1 of Benton County Blackhills Power & Light Company Bonneville Power Adm. BP Energy Company Burbank, City of Calif. Dept. of Water Resources Calpine Energy Services, L.P. Candela Energy Corporation Cargill-Alliant, LLC Carolina Power & Light Company Cheyenne Light, Fuel and Power Co. Cinergy Capital & Trading, Inc. Cinergy Operating Companies City of Anaheim, Public Utilities Dept. City of Azusa City of Banning City of Glendale Water & Power Dept. City of Independence City of Klamath Falls City of Palo Alto City of Riverside, California City of Santa Clara Electric Department Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 City of Sikeston, Board of Municipal Utilities City Utilities of Springfield, Missouri City Water & Light (Jonesboro, AR) Clatskanie PUD Cleco Marketing & Trading LLC Cleco Power LLC CMS Marketing, Services and Trading Company CNG Power Services Corp. Colorado River Commission of Nevada Colorado Springs Utilities Colton, City of Columbia Energy Power Marketing Columbia Power Corporation Cominco, Ltd. Commonwealth Energy Corporation ConAgra Energy Services, Inc. Conectiv Energy Supply, Inc. Conoco Gas & Power Marketing - a division of Conoco Inc. Constellation Power Source Cook Inlet Energy Supply Coral Power, L.L.C. Deseret G&T DTE Energy Trading, Inc. Duke Energy Trading & Marketing, LLC Duke Power Duke Solutions, Inc. Duke/Louis Dreyfuss, LLC Dynegy Power Marketing, Inc. Dynegy Power Services, Inc. E prime Edison Mission Marketing & Trading, Inc. Edison Source Edmonton Power Authority, Alberta E1 Paso Electric E1 Paso Merchant Energy, L.P. Empire District Electric Co. Energy Transfer Group, LLC EnerZ Corporation Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Engage Energy America LLC Engelhard Power Marketing, Inc. ENMAX Energy Corporation ENMAX Energy Marketing Inc. Enron Power Marketing, Inc. Enserco Energy Inc. Entergy Arkansas, Inc. Entergy Gulf States, Inc. Entergy Louisiana, Inc. Entergy Mississippi, Inc. Entergy New Orleans, Inc. Entergy Power, Inc. Entergy Services, Inc. as agent for the Entergy Operating Companies Entergy-Koch Trading, LP Equitable Power Services Co. Eugene Water & Electric Board Exelon Generation Company, LLC Farmington, City of Federal Energy Sales, Inc. FPL Energy Power Marketing Inc. Golden Spread Electric Cooperative Grand River Dam Authority Hafslund Energy Trading, LLC Hetch-Hetchy Water & Power Hinson Power Co., LLC Howard Energy Co., Inc. IDACORP Energy L.P. Idaho Power Company IGI Resources, Inc. Illinova Energy Partners, Inc. Imperial Irrigation District Industrial Energy Applications, Inc. InterCoast Power Marketing J. Aron & Company KAMO Electric Cooperative, Inc. Kansas City Board of Public Utilities Kansas City Power & Light KN Energy Marketing Lafayette Utilities System LG&E Energy Marketing Inc. Lincoln Electric System Los Alamos County Los Angeles Dept. of Water & Power Louisiana Generating LLC Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 First Revised Sheet No. 92 Superseding Original Sheet No. 92 Louisville Gas & Electric Company Maclaren Energy Inc. Mason County PUD No. 3 McMinnville Water & Light Merchant Energy Group of the Americas, Inc. Merrill Lynch Capital Services, Inc. Metropolitan Water District MidAmerican Energy Company MidCon Power Services Corp. MIECO, Inc. Minnesota Power, Inc. Mirant Americas Energy Marketing, LP Missouri Joint Municipal Electric Utility Comm. Modesto Irrigation District Morgan Stanley Capital Group, Inc. M-S-R Public Power Agency Municipal Energy Agency of Mississippi Municipal Energy Agency of Nebraska Nebraska Public Power District Nevada Power Co. New West Energy NorthPoint Energy Solutions Inc. Northern California Power Agency Northern States Power Company NP Energy Inc. NRG Power Marketing Inc. OGE Energy Resources, Inc. Oklahoma Gas & Electric Oklahoma Municipal Power Authority Omaha Public Power District ONEOK Power Marketing Company Otter Tail Power Company Pacific Gas & Electric Co. Pacific Northwest Generating Coop. PacifiCorp PacifiCorp Power Marketing, Inc. PanCanadian Energy Services Pasadena, City of PG&E Energy Services PG&E Energy Trading - Power, L.P. PG&E Power Services Company Effective: March 1, 2002 Western Systems Power Pool Rate Schedule FERC No. 6 Phibro Inc. Pinnacle West Capital Corporation Plains Elec. Gen. & Trans. Coop. Inc. Platte River Power Authority Portland General Electric Co. Power Exchange Corporation Powerex PPL Electric Utilities Corporation PPL EnergyPlus, LLC PPL Montana, LLC Public Service Co. of NM Public Service Co. of Colorado Public Util. Dist. No. 1 of Douglas Cty. Public Util. Dist. No. 1 of Franklin Cty. PUD No. 1 of Chelan County PUD No. 1 of Grays Harbor County PUD No. 1 of Snohomish County PUD No. 2 of Grant County Puget Sound Energy QST Energy Trading Inc. Questar Energy Trading Rainbow Energy Marketing Corporation Redding, City of Reliant Energy Services, Inc. Rocky Mountain Generation Coop., Inc. Roseville Electric Sacramento Municipal Utility District Salt River Project San Diego Gas & Electric Co. Seattle City Light Sempra Energy Resources Sempra Energy Solutions Sempra Energy Trading Corp. Sierra Pacific Power Co. Southern Calif. Edison Co. Southern California Water Company Southern Company Services, Inc. Southern Illinois Power Cooperative Southwest Power Administration Southwestern Public Service Split Rock Energy LLC Statoil Energy Trading, Inc. Strategic Energy LLC Sunflower Electric Power Corp. Tacoma Power Issued by: Michael E. Small, General Counsel to Western Systems Power Pool Issued on: December 21, 2001 Sixth Revised Sheet No. 93 Superseding Fifth Sheet No. 93 Tenaska Power Services Co. Tennessee Valley Authority Texaco Energy Services Texas-New Mexico Power Company The Detroit Edison Co. The Energy Authority The Montana Power Company The Power Company of America, LP Tractebel Energy Marketing, Inc. TransAlta Energy Marketing (US) Inc. TransCanada Power, div. of TransCanada Energy Ltd. Tri-State Generation and Transmission Assoc. Tucson Electric Power Turlock Irrigation District TXU Energy Trading Company Union Electric Company Utah Associated Municipal Power Systems UtiliCorp United Vastar Power Marketing, Inc. Vernon, City of VIASYN, Inc. Virginia Electric and Power Company Vitol Gas & Electric LLC WAPA-Colorado River Storage Project Management Center WAPA-Desert Southwest Region WAPA-Rocky Mountain Region WAPA-Upper Great Plains Region WAPA-Sierra Nevada Region West Kootenay Power Ltd. Western Farmers Electric Co-op Western Power Services, Inc. Western Resources, Inc. Williams Energy Marketing & Trading Co. WPS Energy Services, Inc. XCEL Energy Services, Inc. Effective: March 1, 2002 EXHIBIT C MASTER CONFIRMATION AGREEMENT UNDER THE WESTERN SYSTEMS POWER POOL AGREEMENT BETWEEN AND NORTHERN CALIFORNIA POWER AGENCY This Master Confirmation Agreement under the Western Systems Power Pool ("WSPP") Agreement (the "Master Confirmation") sets forth the agreement between ("Counterparty") and Northern California Power Agency ("NCPA") effective as of the __ day of ,2004. WHEREAS, this Master Confirmation is being provided pursuant to and in accordance with WSPP Agreement, as amended periodically with FERC approval, and as modified hereby, to which Counterparty and NCPA are Parties; NOW THEREFORE, in consideration of the mutual consents and agreements contained herein and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, Counterparty and NCPA agree to the following terms and conditions. GENERAL This Master Confirmation shall govern all transactions between the Parties under the WSPP Agreement. By entering into this Master Confirmation, Counterparty and NCPA intend to have these provisions modify, supplement and amend the WSPP Agreement and to have these provisions apply to all Confirmation Agreements and transactions between Counterparty and NCPA. The WSPP Agreement, as modified, supplemented and amended by this Master Confirmation, shall be referred to as the "Agreement". Terms used but not defined herein shall have the meanings ascribed to them in the WSPP Agreement. In the event of any conflict between the terms of this Master Confirmation and the WSPP Agreement, the terms of this Master Confirmation shall control. (a) (b) SECTION 4 DEFINITIONS Section 4.1c of the WSPP Agreement is modified by including "CAISO" as an equivalent abbreviated form of the defined term "California ISO" such that the definition now reads: "4.1 c California ISO (or CAISO) ..." A new Section 4.1g shall be added in Section 4 as follows: "4.1g CAISO Firm Transaction: a transaction under Service Schedule C in which the Seller shall sell and the Purchaser shall purchase a quantity of electric energy equal to the hourly quantity, without Ancillary Services (as defined in the CAISO Tariff) that is or will be scheduled as a schedule coordinator to schedule coordinator transaction pursuant to the CAISO Tariff, for which the only excuse for failure to deliver or receive is an "Uncontrollable Force" (as defined in the CAISO Tariff) called by the CAISO in accordance with the CAISO Tariff. (c) A new Section 4.1h shall be added in Section 4 as follows: "4.1h CAISO Tariff: the FERC approved tariff of CAISO, including all CAISO protocols, as the same may be amended from time to time." SECTION 10 UNCONTROLLABLE FORCES Section 10 of the WSPP Agreement is modified by adding at the beginning of the section, the words "Except in connection with scheduling, delivery or receipt under a CAISO Firm Transaction,". (a) (b) (c) (d) SECTION 21 LIABILITY AND DAMAGES The second sentence of Section 21.1(a) of the WSPP Agreement shall be modified to read as follows: "THE LIABILITY OF THE NON-PERFORMING OR DEFAULTING PARTY SHALL BE LIMITED AS SET FORTH IN SUCH PROVISIONS, AND ALL OTHER DAMAGES ARE HEREBY WAIVED." The third sentence of Section 21.1 of the WSPP Agreement shall be modified by adding "21.2," before the text "21.3". Section 21.3(a)(4) of the WSPP Agreement shall be modified by replacing the language beginning with "within the billing period" through the end of the sentence, with the following: "within three (3) Business Days from the date that an invoice for such amount is received. The Performing Party may invoice the Non-Performing Party at any time following the Performing Party having incurred an amount under this Section, subject to the two-year limitation as specified in Section 9.4." Section 21.3(d) of the WSPP Agreement shall be modified by deleting the phrase "as required by Section 9 of this Agreement" and by deleting the second and third sentences of the Section in their entirety and replacing them with "Upon resolution of the dispute, any excess amount of bills which may have been overpaid shall be returned by the owing Party upon determination of the correct amount, with interest accrued at the rate set forth in Section 9.4, prorated by days from the date of overpayment to the date of refund." (a) (b) SECTION 22 DEFAULT A new Section 22.1(0 is added to Section 22 of the WSPP Agreement as follows: "An Event of Default shall also include the failure by the Defaulting Party to schedule, deliver, or receive electric capacity, energy, Ancillary Services or other products sold and purchased under a specified Confirmation Agreement for three (3) consecutive calendar days and such failure is not excused pursuant to the product definition, this Agreement or under the terms of the specified Confirmation Agreement." A new Section 22.2a is added to Section 22 of the WSPP Agreement as follows: (c) (d) "22.2a Upon any Event of Default or Potential Event of Default, the Non-Defaulting Party may, in addition to any other remedies available hereunder, suspend performance under this Agreement and under any Confirmation Agreement, l~rovided, however, in no event shall any such suspension continue for longer than ten (10) Business Days with respect to any single Confirmation Agreement unless a termination date shall have been declared and notice thereof pursuant to Section 22.2 given. "Potential Event of Default" means an event which, with notice or passage of time or both, would constitute an Event of Default, provided that the failure to comply with any requirement of this Agreement, including the requirements of Section 27, or a Confirmation Agreement, before the expiration of the time period expressly specified for such compliance in this Agreement or the Confirmation Agreement (but not including any period that is provided as a cure-period for what would otherwise constitute an Event of Default), if any, shall not be considered a Potential Event of Default unless and until the applicable time period has expired without compliance." Section 22.3(c) of the WSPP Agreement shall be modified by deleting, in the third sentence, the language beginning with "shall pay the remaining amount" through the end of that sentence and inserting in its place the words "shall make no payment to the other Party, and notwithstanding anything in this Agreement to the contrary, the amount by which such Gain exceeds the Losses and Costs for the purpose of this Agreement shall be deemed to be zero (0)." Section 22.3(e) of the WSPP Agreement shall be modified by deleting subsections 22.3(e)(i), 22.3(e)(ii), and 22.3(e)(iii) in their entirety and by deleting the first paragraph of subsection 22.3(e)(iv) such that the subsection begins with the language: "If the Defaulting Party disagrees with the calculation .... "and ends with the language "...or similar charges imposed by the Non-Defaulting Party." SECTION 24 GOVERNING LAW Section 24 of the WSPP Agreement is deleted and replaced with the following: "This Agreement and any Confirmation Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflicts of laws rules thereof. EACH PARTY WAIVES ITS RESPECTIVE RIGHT TO ANY JURY TRIAL WITH RESPECT TO ANY LITIGATION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT." NCPA and Party agree that the standard of review for any proposed changes to the rates, terms, and/or conditions of service of this Master Confirmation or any Confirmation Agreement or transaction entered into hereunder, whether proposed by a Party, a non-party or FERC acting sua sponte, shall be the "public interest" standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956). Each Party hereby reserves all of its rights under the Federal Power Act and any other applicable federal or state statutory or common law to bring a complaint or other action against the other Party regarding this Master Confirmation or any Confirmation Agreement or transaction entered into thereunder on the basis of fraud or market manipulation on the part of either Party that is demonstrated to have a direct nexus to the formation and tainted such formation of the Confirmation Agreement or transaction itself. The Parties intend that any action brought pursuant to this section shall be governed by the "just and reasonable" standard specified in the Federal Power Act or such other standard of proof as may be specified by applicable federal or state law, and not the more onerous "public interest" standard specified above. SECTION 35 FORWARD CONTRACTS AND OTHER REPRESENTATIONS Section 35 of the WSPP Agreement is modified by (i) inserting, after the words "the Parties are" and before the phrase "forward contract merchants", the phrase ", or shall be deemed to be," and (ii) by inserting the following new sentences in between the first and second sentences: "The parties acknowledge and agree that each Party's ability to liquidate and accelerate payment under transactions entered into pursuant to any Confirmation Agreements hereunder (as provided in Section 22.3) as forward contract under Section 556 of the United States Bankruptcy Code is a material inducement supporting such party's entry into this Agreement and such transactions. The Parties agree further that each Party's business consists in whole or in part of entering into forward contracts as or with merchants in electric energy, capacity, and other related products and/or services, which is presently the subject of dealing in the forward contract trade. No Party shall assert before any court or other governmental authority that another Party is not, or shall not be treated as a forward contract merchant under the United States Bankruptcy Code. NCPA warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on grounds of sovereignty or similar grounds with respect to itself or its surplus revenues from (a) suit, (b) jurisdiction of court (including a court located outside the jurisdiction of its organization, subject to the law of proper venue), (c) relief by way of injunction, order for specific performance or recover of property, or (d) execution or enforcement of any valid judgment. BILLING ADDRESSES The billing address for NCPA for the purpose of Section 9 of the WSPP Agreement shall be: Northern California Power Agency 180 Cirby Way Roseville, CA 95678 With Additional Notices to: Attn: Contract Administration Phone: (916) 781-4296 Facsimile: (916) 783-7693 Invoices/Payments/Credit & Collections: Power Accounts Administrator (916) 781-4224/3636 (916 781-4255 (fax) Wire Transfer: ABA Routing: 121122676 Bank: US Bank For Deposit to: Northern California Power Agency Acct No. 1-534-0216-2744 Attention: Donna Jojola U.S. Bank 680 9th Street, Suite 1100 Sacramento, CA 95814 (916) 552-1864 (916) 448-6518 (fax) Pre-scheduling: (916) 786-0123/0124 (916) 781-4239 (fax) Real-time/Dispatch: (916) 786-3518/3519 (916) 781-4226 (fax) Schedule Coordinator: (916) 781-4237 (916) 781-4226 (fax) Counterparty Info The billing address for either Party may be changed by such Party upon written notice to the other Party. Except to the extent herein provided for, no amendment or modification to the Agreement shall be enforceable unless reduced to writing and executed by both Parties. In WITNESS WHEREOF, the Parties have caused this Master Confirmation to be duly executed by its authorized officers or agents effective as of the date first above written. Counterparty Northern California Power Agency By: Name: Title: By: Name: Title: ITEM NO. ].oa DATE: November 3, 2004 AGENDA SUMMARY REPORT SUBJECT: ADOPTION OF RESOLUTIONS APPROVING APPLICATIONS FOR STATE OF CALIFORNIA DEPARTMENT OF PARKS AND RECREATION GRANTS FOR VARIOUS PARK IMPROVEMENT PROJECTS Due to the most recent funding of a State of California Parks Improvement Bond, the State Parks and Recreation Department has notified the City of Ukiah of funding availability under the Roberti-Z'Berg- Harris (RZH) Urban Open Space and Recreation Grant Programs. Total funding availability for the Non-Urbanized Need-Basis (Competitive) component of RZH, for which Ukiah qualifies, is approximately $ 28,000,000. Individual grant applications must be a minimum of $30,000 and may not exceed $500,000, and require a local match of approximately 30%. Eligible projects include the categories of Acquisition, Development/Rehabilitation, and Special Major Maintenance. The deadline for applications is December 10, 2004 and applicants may submit more than one application. Staff has identified three projects, which meet the criteria for application and is recommending be included in the application process. Also provided are the amounts staff is recommending be requested in the grants, and estimated local match requirement. (Continued on Pa,qe 2) RECOMMENDED ACTION: Approve projects as proposed and adopt resolutions authorizing applications to the RZH Urban Open Space and Recreation Grant Programs. ALTERNATIVE COUNCIL POLICY OPTIONS: 1. Determine proposed project list requires revision, move to approve with revisions and adopt appropriate Resolutions. 2. Determine applications to State for Park Bond funds are inappropriate at this time and do not move to adopt Resolutions Citizen Advised: Requested by: Prepared by: Coordinated with: Attachments: 1. N/A State of California Parks and Recreation Department Sage Sangiacomo, Community Services Supervisor Candace Horsley, City Manager and Larry W. DeKnoblough, Services Director Proposed Application Resolutions APPROVED: ' ~... ED/ZIP1 Candace Horsley, City~anager Parksbond04.Asr Community Skate Park Development Project Staff is estimating the cost of construction to be at least $600,000. This estimate is based upon the cost of the recently built Willits Park and estimates provided by the Skatepark Design Committee. Staff is recommending applying for the maximum amount of $500,000 for this project with the remaining and match amount of $150,000 being raised through private fundraising efforts by the Skatepark Committee. Anton Stadium Rehabilitation Project This project consists of the renovation of the Anton Stadium grandstands, restrooms, dugouts, and infield. Anton Stadium renovation is among the list of Capital projects discussed by the Council during previous budget hearings in which $75,000 for repairs and ADA upgrades was designated in the 699 Fund. The current grandstands are experiencing serious structural failure, are in need of a new roof, and do not comply with handicap access requirements. In addition the attached building and locker rooms are no longer habitable. Due to funding limitations, staff's original proposal for $75,000 was limited to the structural renovation of the grandstands and improving the access issue. With the availability of park bond funds, staff is proposing to expand the project and rather than simply renovate the grandstands it is possible to remove the old structure and construct new stands along with constructing new locker rooms and a small team room. This room could also double as recreation room for day camp and hold small recreation classes. Staff is recommending a $500,000 grant application for this project, which would require a local match of approximately $150,000. Aquatics Center Rehabilitation As previously discussed by Council, the Aquatics Center is in need of total reconstruction or replacement, which will likely approach $3,000,000 in cost. As the planning and fundraising for a project of this magnitude will require several years, staff is recommending the City apply for grant funds to complete upgrades which will allow the pool to continue operating until the larger project can be initiated. Recommended upgrades include a new liner for the lap pool, removal of the old bleachers and installation of a picnic area, barbecues, upgrades to the restrooms and pool office, installation of an ADA accessible lift, and miscellaneous ADA and aesthetic upgrades to the grounds. Staff is recommending the City apply for a grant of $500,000 requiring a match of $150,000. Attachment RESOLUTION NO: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING THE APPLICATION FOR GRANT FUNDS FOR THE ROBERTI-Z'BERG-HARRIS NONURBANIZED AREA NEED-BASIS PROGRAM UNDER THE CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS, AND COASTAL PROTECTION ACT OF 2002 For Ukiah Skate Park Development Project WHEREAS, the people of the State of California have enacted the CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS AND COASTAL PROTECTION ACT OF 2002 which provides funds to the State of California for grants to eligible applicants, and WHEREAS, the California Department of Parks and Recreation has been delegated the responsibility for the administration of the Roberti-Z'Berg-Harris Nonurbanized Area Need-Basis Program for grants and the grant Project shown above within the State, setting up necessary procedures, and WHEREAS, said procedures established by the California Department of Parks and Recreation require the Applicant's Governing Body to certify by resolution the approval of the Application before submission of said Application to the State, and WHEREAS, the Applicant will enter into a Contract with the State of California for the Project; NOW, THEREFORE, BE IT RESOLVED that the Ukiah City Council hereby: . Approves the filing of an Application for local assistance funds from the Roberti- Z'Berg-Harris Nonurbanized Area Need-basis Program under the California Clean Water, Clean Air, Safe Neighborhood Parks and Coastal Protection Act of 2002; and . Certifies that the Applicant has or will have sufficient funds to operate and maintain the Project; and Certifies that the Applicant has reviewed, understands, and agrees to the General Provisions contained in the Contract shown in the Procedural Guide; and . Certifies that the Grantee has or will have available, prior to commencement of any work on the Project, the required Match; and . Certifies that the Project conforms to the recreation element of any applicable city or county general plan; and , Appoints the City Manager as agent to conduct all negotiations, execute and submit all documents including, but not limited to, Applications, agreements, payment requests and so on, which may be necessary for the completion of the Project. PASSED AND ADOPTED on the 3rd day of November, 2004 by the following roll call vote: AYES: NOES: ABSENT: ABSENT: ATTEST: Eric Larson, Mayor Marie Ulvila, City Clerk RESOLUTION NO: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING THE APPLICATION FOR GRANT FUNDS FOR THE ROBERTI-Z'BERG-HARRIS NONURBANIZED AREA NEED-BASIS PROGRAM UNDER THE CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS, AND COASTAL PROTECTION ACT OF 2002 For Anton Stadium Rehabilitation Project WHEREAS, the people of the State of California have enacted the CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS AND COASTAL PROTECTION ACT OF 2002 which provides funds to the State of California for grants to eligible applicants, and WHEREAS, the California Department of Parks and Recreation has been delegated the responsibility for the administration of the Roberti-Z'Berg-Harris Nonurbanized Area Need-Basis Program for grants and the grant Project shown above within the State, setting up necessary procedures, and WHEREAS, said procedures established by the California Department of Parks and Recreation require the Applicant's Governing Body to certify by resolution the approval of the Application before submission of said Application to the State, and WHEREAS, the Applicant will enter into a Contract with the State of California for the Project; NOW, THEREFORE, BE IT RESOLVED that the Ukiah City Council hereby: . Approves the filing of an Application for local assistance funds from the Roberti- Z'Berg-Harris Nonurbanized Area Need-basis Program under the California Clean Water, Clean Air, Safe Neighborhood Parks and Coastal Protection Act of 2002; and . Certifies that the Applicant has or will have sufficient funds to operate and maintain the Project; and Certifies that the Applicant has reviewed, understands, and agrees to the General Provisions contained in the Contract shown in the Procedural Guide; and . Certifies that the Grantee has or will have available, prior to commencement of any work on the Project, the required Match; and . Certifies that the Project conforms to the recreation element of any applicable city or county general plan; and o Appoints the City Manager as agent to conduct all negotiations, execute and submit all documents including, but not limited to, Applications, agreements, payment requests and so on, which may be necessary for the completion of the Project. PASSED AND ADOPTED on the 3rd day of November, 2004 by the following roll call vote: AYES: NOES: ABSENT: ABSENT: ATTEST: Eric Larson, Mayor Marie Ulvila, City Clerk RESOLUTION NO: RESOLUTION OF THE CITY COUNCIL OF THE CITY OF UKIAH APPROVING THE APPLICATION FOR GRANT FUNDS FOR THE ROBERTI-Z'BERG-HARRIS NONURBANIZED AREA NEED-BASIS PROGRAM UNDER THE CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS, AND COASTAL PROTECTION ACT OF 2002 For Ukiah Municipal Swimming Pools Rehabilitation Project WHEREAS, the people of the State of California have enacted the CALIFORNIA CLEAN WATER, CLEAN AIR, SAFE NEIGHBORHOOD PARKS AND COASTAL PROTECTION ACT OF 2002 which provides funds to the State of California for grants to eligible applicants, and WHEREAS, the California Department of Parks and Recreation has been delegated the responsibility for the administration of the Roberti-Z'Berg-Harris Nonurbanized Area Need-Basis Program for grants and the grant Project shown above within the State, setting up necessary procedures, and WHEREAS, said procedures established by the California Department of Parks and Recreation require the Applicant's Governing Body to certify by resolution the approval of the Application before submission of said Application to the State, and WHEREAS, the Applicant will enter into a Contract with the State of California for the Project; , . NOW, THEREFORE, BE IT RESOLVED that the Ukiah City Council hereby: . Approves the filing of an Application for local assistance funds from the Roberti- Z'Berg-Harris Nonurbanized Area Need-basis Program under the California Clean Water, Clean Air, Safe Neighborhood Parks and Coastal Protection Act of 2002; and Certifies that the Applicant has or will have sufficient funds to operate and maintain the Project; and Certifies that the Applicant has reviewed, understands, and agrees to the General Provisions contained in the Contract shown in the Procedural Guide; and Certifies that the Grantee has or will have available, prior to commencement of any work on the Project, the required Match; and . Certifies that the Project conforms to the recreation element of any applicable city or county general plan; and o Appoints the City Manager as agent to conduct all negotiations, execute and submit all documents including, but not limited to, Applications, agreements, payment requests and so on, which may be necessary for the completion of the Project. PASSED AND ADOPTED on the 3rd day of November, 2004 by the following roll call vote: AYES: NOES: ABSENT: ABSENT: ATTEST: Eric Larson, Mayor Marie Ulvila, City Clerk