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HomeMy WebLinkAboutResolution No. UB- 09-C0690 RESOLUTION NO. 09-C69 0 A RESOLUTION OF THE AZUSA UTILITY BOARD/CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, ADOPTING A POLICY AUTHORIZING THE CITY MANAGER OR HIS DESIGNEE TO ENTER INTO REPLACEMENT WATER AGREEMENTS AND PRODUCTION RIGHT AGREEMENTS WHEREAS, the City of Azusa ("City") has a controlling interest in the Azusa Valley Water Company ("AVWC") and the Azusa Agricultural Irrigating Company ("Azusa Ag.") and an interest in water supplies as a result of a contractual arrangement with the Miller -Coors Brewing Company ("Miller") . As a result, the City is the owner of record and otherwise beneficially controls, or is the duly authorized and acting agent for, the ownership of 8.11334 percent of the Production Rights in the Main San Gabriel Basin as adjudicated in the case of "Upper San Gabriel Valley Municipal Water District vs. City of Alhambra et al." LASC No. 92418 ("Judgment"); and WHEREAS, the ownership of said Production Rights entitles the City, through its own rights and through the AVWC, to take delivery or otherwise produce from the Main San Gabriel Basin said 8.11334 percent of the Main San Gabriel Basin Production Rights on an annual basis or in such amount as is determined from time to time by the Main San Gabriel Basin Watermaster ("Watermaster"); and WHEREAS, surface and groundwater have been taken from the groundwater resources utilized by the water purveyors in the San Gabriel Valley ("Watershed") at a rate greater than that at which natural precipitation and runoff can replenish them. To maintain productivity of wells in spite of this overall condition, the Watershed must be recharged by importing water from outside sources and spreading it in basins located within Watershed. This replacement water currently is provided by three (3) local water districts which are referred to as "Responsible Parties" under the Judgment): Upper San Gabriel Valley Municipal Water District ("USGVMWD"); Three Valleys Municipal Water District; and the San Gabriel Valley Municipal Water District ("SGVMWD"). The City commonly purchases its replacement water from the SGVMWD and the USGVMWD; and WHEREAS, Watermaster determines the annual amount of water that can safely be produced from the Watershed. Parties which produce in excess of their percentage share of the operating safe yield are subject to assessment by Watermaster for the purpose of purchasing replacement water to recharge the groundwater basin. By agreement between the City, Watermaster, USGVMWD, and the SGVMWD, 40% of the City's total annual water production is considered produced within the service boundaries of the SGVMWD and is subject to a water replacement cost (currently $130 per acre foot) for water produced in excess of the City's water rights. The remaining 60% of the City 's total annual water production is considered produced within the service boundaries of the USGVMWD and is subject to a water replacement cost (currently -$450.00 per acre foot) for water produced in excess of the City's water rights; and WHEREAS, based on the water production percentage allocations and current and future water replacement costs set forth above, the City is able to utilize replacement water purchases at the lower rate from SGVMWD in order to meet its assessment obligations. As a result, the 0 0 City's Production Rights allocated under the USGVMWD are available for lease or temporary assignment to third parties who are also obligated to meet their respective assessment obligations; and WHEREAS, the City also executes leases involving the City's water rights and the City's interests in water rights of AVWC, Azusa Ag, and Miller as necessary to meet production and contractual requirements in connection with the Production Rights; and WHEREAS, the time period within which the City and other water purveyors receive Watermaster information regarding the extent of their assessment obligations and their need to purchase replacement water is very short and the time period commonly involves less than a business week on or about the end of the applicable fiscal year ("FYE Period"). Within said FYE Period, the water purveyors are required to: (a) determine their assessment obligations; (b) find a source which is willing to lease them an amount of replacement water; (c) enter into the applicable agreements for said arrangements; and (d) perform said agreements; and WHEREAS, as a result of the short FYE Period, it is not reasonably feasible to call and conduct a meeting of the City Council to consider approval of the replacement water purchase agreement ("Replacement Water Agreement") or any agreement whereby the City may take advantage of its available Production Rights by leasing or temporarily assigning such rights to a third party ("Production Right Agreement"); and WHEREAS, the purpose of this Resolution is to provide pre -authorization for the City Manager, or his designee, to execute the applicable Replacement Water Agreement and/or Production Right Agreement subject to ratification by the City Council. THE CITY COUNCIL OF THE CITY OF AZUSA, CALIFORNIA, DOES HEREBY RESOLVE AS FOLLOWS: Section 1. Pre -Authorization. The City Council hereby provides pre- authorization for the City Manager, or his designee, to execute and otherwise enter into any and all Replacement Water Agreements and/or Production Right Agreements, which the City Manager, or his designee, may determine in his reasonable discretion to be in the best interests of the City in order to meet water resource needs, financial obligations, and/or legal requirements. Section 2. Ratification. Any and all Replacement Water Agreements and/or Production Right Agreements which may be entered into by the City Manager or his designee pursuant to the authority set forth in this Resolution shall be brought before the City Council for consideration and possible ratification at a meeting of the City Council as soon as practicable after said action taken by the City Manager or his designee. Section 3. Existing Authority Of City Manager. Nothing in this Resolution shall be deemed to either expand or restrict the existing authority of the City Manager or his designee to enter into agreements or expend City funds. Nothing in this Resolution shall be deemed to impact the authority of the City Manager or his designee to enter into agreements or expend City funds in the event of an emergency or other urgent situation as such authority may be provided under any applicable rule, regulation, policy or Azusa Municipal Code provision. 0 0 Section 4. Severability. If any section, subsection, clause or phrase in this Resolution is for any reason held invalid, the validity of the remainder of this Resolution shall not be affected thereby. The City Council hereby declares that it would have passed this Resolution and each section, subsection, sentence, clause, or phrase thereof, irrespective of the fact that one or more sections, subsections, sentences, clauses or phrases or the application thereof be held invalid. Section 5. Effective Date. This Resolution shall become effective upon its adoption. PASSED, APPROVED AND ADOPTED this 27th day of July, 2009. 0 J EPH R. ROCHA, MAYOR ATTEST: i VERA MENDOZA, CITY CLERK CITY OF AZUSA APPROVED AS TO FORM: BEST BEST & KRIEGER LLP CITY ATTORNEY STATE OF CALIFORNIA ) COUNTY OF LOS ANGELES ) ss. CITY OF AZUSA ) I, Vera Mendoza, City Clerk of the City of Azusa, do hereby certify that the foregoing Resolution No. 09-C69 was duly introduced and adopted at a regular meeting of the Azusa Utility Board/City Council on the 27th day of July 2009, by the following vote, to wit: AYES: COUNCILMEMBERS: GONZALES, CARRILLO, HANKS, ROCHA NOES: COUNCILMEMBERS: NONE ABSENT: COUNCILMEMBERS: MACI/AS r/ VERA MENDOZA, CITY CLERK CITY OF AZUSA