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HomeMy WebLinkAboutResolution 1979-012 RESOLUTION AUTHORIZING A CONTRACT THE STATE OF TEXAS COUNTY OF TARRANT CITY OF NORTH RICHLAND HILLS WH~REA$,. it is. ~ecE:$sary. and. advisable that the C.i ty. enter into the water supply contract, hereinafter authoriz- . . : ed, with Trinity River Authority of Texas. '.' ". THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF NORTH RICHLAND HILLS: Section 1. That the Mayor and City Secretary are au- thorized and directed, for and on behalf of the City, to date, sign, seal, and otherwise execute a water supply contract with Trinity River Authority of Texas in substantially the form and substance attached hereto and made a part hereof for all pur- poses. Section 2. That, upon execution, said water supply con- tract shall be binding upon the City for all purposes. Section 3. That this Resolution is effective immediately ------------------- CERTIFICATE FOR RESOLUTION AUTHORIZING A CONTRACT THE STATE OF TEXAS COUNTY OF TARRANT CITY OF NORTH RICHLAND HILLS We, the undersigned officers of said City, hereby certify as follm..·s: 1. The City Council of said City duly convened in REGULAR MEETING ON THE 14TH DAY OF MAY, 1979, at the City Hall, and the roll was called of the duly consti- tuted officers and members of said City Council, to-wit: Jeanette Moore, City Secretary Dick Faram, Mayor Denver Mills James F. Cato, Mayor Pro-tem Lena Mae Reeder James "Jim" Wood John W. Michener, Jr. Sidney Cavanaugh Dave Freeman and all of said persons were present, except ,the following absentees: N/JNe.,., thus constitut:£ng a quorum. Whereupon among other business, the fOllowing was transacted at said Meeting: a written RESOLUTION AUTHORIZING A CONTRACT was duly introduced for the consideration of said City Council and read in full. It was then duly moved and seconded that said Resolution be adopted; and, after due discussion, said motion, carrying with it the adoption of said Resolution, prevailed and carried by the following vote: AYES: All members of said City Council shown present above voted "Aye". NAYS: None. 2. That a true, full, and correct copy of the aforesaid Resolution adopted at the Meeting described in the above and foregoing paragraph is attached to and follows this Certificate; that said Resolution has been duly recorded in said City Coun- cil's minutes of said Meeting; that the above and foregoing para- graph is a true, full, and correct excerpt from said City Coun- cil's minutes of said Meeting pertaining to the adoption of said Resolution; that the persons named in the above and foregoing paragraph are the duly chosen, qualified, and acting officers and members of said City Council as indicated therein; that each of the officers and members of said City Council was duly and suffi- ciently notified officially and personally, in advance, of the time, place, and purpose of the aforesaid Meeting, and that said Resolution would be introduced and considered for adoption at said Heeting, and each of said officers and members consented, in advance, to the holding of said Meeting for such purpose; and that said Meeting was open to the public, and public notice of the time, place, and purpose of said Meeting was given, all as required by Vernon's Ann. Civ. St. Article 6252-17. 3. That the Mayor of said City has approved, and hereby approves, the aforesaid Resolution; that the Mayor and the City Secretary of said City have duly signed said Resolution; and that the Mayor and the City Secretary of said City hereby de- clare that their signing of this Certificate shall constitute the signing of the attached and following copy of said Resolu- tion for all purposes. SIGNED AND SEALED the 14th ~ daY:l::duéhV [/ Mayor SEAL) ---------___________________________________________ I, the undersigned, City Attorney of the City of North Richland Hills, Texas, hereby certify that I read and approved as to legality the attached and following Resolution, prior to it3 adoption. NOW,THEREFORE, i:1 consideration of the mutual COVenants and agreemen~s herein contained, Authority agrees to expand the ProJect ~n accordance with the Engineering Report and to supply water to Cityþand City agrees to pay Autho~itv ~or water supplied uPQn terms and conditions hereinafter set f~rth, to-wit: Section 1. DEFINITION OF TERMS. Terms and expressions as used in this Contract, unless the context clearly shows otherwise, shall have the fOllowing me-anings: .. · A~.IIAdditional. .Con.tracting Party·" means: .any" party, not· de~' fined as a Contracting' Party with whom Authority makes a con- tract f017"... stlPp.lying . t L:,eat ed, ~ate.r through 'she Project. B. "Adjusted Annual Payment" means the Annual Payment, as adjusted due to service to Additional Contracting Parties and/or as required during or after each Fiscal Year. C. "Annual Payment" means the amount of money to be paid to Authority by City as its proportionate share of the Annual Requirement. D. "Annual Requirem.en t" means the total amount of money required for Authority to pay all Operation and Maintenance Ex- pense of the Project, to pay the debt service on its Bonds, and to pay any amounts required to be deposited in any special or reserve funds required to be established and/or maintained by the provisions of the Bond Resolution. E. "Bond Resolutions" means the resolutions of Authority which authorize the Bonds. F. "Bonds" means the revenue bonds heretofore and hereafter issued by Authority, whether one or more issues, and the interest coupons appertaining thereto, in connection with the acquisition, construction, improvement, betterment, and extension of the Pro- ject, and any bonds issued to refund any Bonds. The outstanding Bonds heretofore issued are the Authority's Tarrant County Pro- ject Revenue Bonds, Series 1975 and Series 1979. G. "Contracting Parties" means the Cities of Bedford, Euless, Colleyville, Grapevine, and North Richland Hills. H. "Fiscal Year" means the fiscal year of Authority, which is December 1 through November 30. I. "Operation and Maintenance Expense" means all costs of operation and maintenance of the Project including (for greater certainty but without limiting the generality of ~~e foregoing) repairs and replacements for which no special fund is created in the Bond Resolutions, the cost of, raw water, utilities, supervision, engineering, accounting, auditing, legal services, and any other supplies, services, administra- tive costs, and equipment necessary for proper operation and maintenance of the Project, and payments made by Authority in satisfaction of jUdgments resulting from claims not covered by Authority's insurance or not paid by a Contracting Party or Parties arising in connection with the operation and mainten- ance of the Project. The term also includes the charges of the bank or banks where the Bonds are payable. J. "Project" means all r..¡ater supply facilities described in the Engineering Report. Section 2. QUANTITY, QUALITY, POINTS OF DELIVERY, MF~SUR- ING EQUIPMENT, (JNIT OF MEASURElA'~NT AND DELIVERY PRESSURE. -2- THE STATE OF TEL;S COG~TY OF TAFRÞ.NT THIS CONTR.'\CT (hereinafter called "Contract") dated and entered into as of the 25th day of APRIL, 1979, by and be- tween Trinity River Authority of Texas, a governmental agency and a body politic and corporate, created and functioning under Chapter 518, Acts of t~e 2egular Session of the 54th Legislature, as amended (the "Authority .;;'ct") pursuant to Article XVI, Section 59 of the Constitution of Texas (herein called "Authority"), and the CITY OF NORTH RICHLAND HILLS, .' ,. . Texas ,,':a: ci ty:duly·· incorpora.tedunder· . the', laws· 0 f·the State' 0 f", Texas (the "City"). W I T'N E SSE T H - -- WHEREAS, the Authority has constructed facilities ~n Tarrant County for the purpose of supply treated water to cities and others; and WHEREAS, City Owns and operates its water distribution sys- tem and is in need of an additional Source of water supply; and WHEREAS, the Authority has heretofore ent2red into water supply contracts, each dated January 22, 1972, and amended as of January 22, 1975, with the Cities of Bedford and Euless, which are defined as Contracting Parties in said contracts, which permit the Authority to contract with Additional Contract- ~ng Parties, as defined in said contracts; and WHEREAS, the City of North Richland Hills is such an Addi- tional Contracting Party under said contracts and will become a Contracting Party under this contract; and WHEREAS, contracts similar to this Contract are being ex- ecuted with other cities which are Additional Contracting Par- ties under said contracts and will become Contracting Parties as defined in this Contract¡ and ~iHEREAS, City and Authority are authorized to enter into this Contract pursuant to the Authority Ac~, Vernon's Ann. Tex. Civ. St. Article 4413(32c), and other applicable laws; and WHEREAS, Authority proposes to issue its Bonds for the pur- pose of constructing facilities to enable it to supply ~reated water to City and to others, in accordance with a report of Knowlton-Ratli£f-English-Collins, Consulting Engineers, entitled Report on Proposed Bedford-Euless Water System to Trinity River Authority of Texas, dated July, 1971, as Supplemented by a docu- ment dated August, 1978, entitled "Supplement to the Engineering Report on Proposed Bed£ord-Euless !'vater Svste.m which was Dated July 1, 1971"~ prepared by Knmvlton-English"':Plowers, Inc., Con- sulting Engineers, and as further supplemented by a document dated April, 1979, entitled "Trinity River Authority of Texas ~'arrant County Water Project Transmission Facilities For Serving Colleyville, Grapevine, and North Rlchland Hills", by Knowlton- 1:;''''gl; S' -Flo"7Q~"" T-""", ''''''''0 ,....'. 1../-"; 7.' - -d t1"" _0 '" _ -'-'~J. .....- n - ....__s, .....H'_., '- n"'.l.J......_~ng ...ng~neer:::>, an as ....e:c r....go ing report and supplements may be amended or supplemented prior to the execution of construction contracts and as changed by change orders entered after construction contracts have been executed, or as such repor-::. and supplements may be amended or supplemented to provide expanded service in the future (herein collectively called "Engineering Report"); and WHEREAS, it is desirable and necessary to City that Author- ity supply water to City; -1- A. QU&~TITY. Authority agrees to sell and to deliver to City at the Delivery Point or Points hereinafter provided, and City agrees to purchase and take at such Delivery Point or Points treated water required by City during the period of this agreement for its own use and for distribution to the customers served by City's distribution system, to the extent and in the ~~ount prescribed in Section 5(g) of this Contract. Authority will use its best efforts to remain in position to furnish water sufficient for the. reasonable demands of City, but its obligations shall be limited to the amount. of water ,av9-ilahle to i tunder,i ts r,aw water supply contract wi th '¡'arrant County Wat.er Control and Improvement District Number, One, effect- ive April 25, 1979, (the "Raw ~qater Contract"), and by its.. ',. commitments to other Contracting Parties and Additional Contract"- ing Parties, and further by the provisions of the Authority's other water supply contract, effective July 27, 1971, with the aforesaid District. B. QUALITY. The water to be delivered by Authority and received by City shall be potable treated water meeting appli- cable purity standards of the Texas Department of Health Re- Sources. City has satisfied itself that such water will be suitable for its needs. C. POINTS OF DELI'mRY. The Point or Points of Delivery into City's distribution system shall be as designated in the Engineering Report. D. MEASURING EQUIPMENT. (a) Authority shall furnish, install, operate, and maintain at its own expense the neces- sary metering equipment of standard type for measuring properly the quantity of water delivered under this agreement. Such metering equipment shall be located on Authority's supply main at a location to be designated by Authority. Such meter or meters and other equipment so installed shall remain the property of Authority. City shall have access to such main metering equipment at all reasonable times, but the reading, calibration and adjustment thereof shall be done only by the employees or agents of Authority. For the purpose of this agreement, the original record or reading of the main meter shall be the journal or other record book of Authority in its office in which ~~e records of the employees or agents of Authority who take the reading are or may be transcribed. Upon written re- quest of City, Authority will give City a copy of such journal or record book, or permit City to have access to the same in the office of Au~~ority during reasonable business hours. (b) Not more than once in each calendar year, on a date as near the end of such calendar year as practical, Authority shall calibrate its main meter or meters, if requested in writ- ing by City to do so, in the presence of a representative of City, and the parties shall jointly observe any adjustments which are made to the meter in case any adjustments shall be necessary, and if the check meter hereinafter provided for has been installed, the same shall also be calibrated by City in the presence of a representative of Authority and t..'1e parties shall jointly observe any adjustment in case any adj~st..~er-t is necessary. If City shall in writing request .:;'uthority to cali- brate its meters and Authority shall give City written notice of the time when any such calibration is to be made and a repre- sentative of City is not present at the time set, Authority may proceed with calibration and adjus~~ent in the absence of any representative of City. (c) If either party at any time observes a variation be- tween a main delivery meter and the check meter, if any such -3- , ~... check meter shall be installed, such party will promptly notify the other party, and the parties hereto shall then cooperate to procure an immediate calibration test and joint observation of any adjustment and the main meter shall then be adjusted to accuracy. Each party shall give the other oarty fortv-eiqht (48) hours' ,notice of the time of any test òf mëter sò th~t the other party may conveniently have a representative present. (d) If, upon any test, the percentage of inaccuracy of metering equipment is found to be in excess of two percent (2%)" registration thereof, shall be corrected for a period extending baqk. to the i:ime¡tlhen s.uchinaccuracy began,. if such ticie'is ascer~ii~able,: and if such ti~ei~ not ascertai~able, then for a period extending back one-half (1/2) of the time elapsed since the laS't datè 'of èalibration';. but inilo event farther back than a period of six (6) months. If, for any reason, the main meter is out of service or out of repair so that the amount of water delivered cannot be ascertained or computed from the reading ~hereof, the water delivered, through the period such meter is out of service or out of repair, shall be estimated and agreed uppn by the parties thereto upon the basis of the best data available. For such purpose, the best data available shall be deemed to be the registration of any check meter if the same has been installed and is accurately registering. Othertlise, the best data available shall be deem- ed any other meters in the transmission line or treatment plant which can be related to the main delivery meter. If no other meters in the system are operational which will allow deter- mination of delivered quantity, then the amount of water de- livered during such period may be estimated (i) by correcting the error if the percentage of error is ascertainable by cal- ibration tests or mathematical calculation, or (ii) by esti- mating the quantity of delivery by deliveries during the pre- ceding periods under similar conditions when the meter was registering accurately. .... . o· .... (e) City may, at its option and its own expense, install and operate a check meter to check the meter installed by Au- thority, but the measurement of water for the purpose of this agreement shall be solely by the Authority's meter, except in the cases hereinabove specifically provided to the contrary. Such check meter shall be of standard make and shall be subject at all reasonable times to inspection and examination by any employee or agent of the Authority, but the reading, calibra- tion and adjustment thereof shall be made only by the City, except during any period when a check meter may be used under the provisions hereof for measuring the amount of water deliver- ed, in which case the reading, calibration, and adjustment thereof shall be made by Authority with like effect as if such check meter had been furnished or installed by Authority. E. UNIT OF MEASUREMENT. The unit of measurement for water delivered hereunder shall be 1,000 gallons of water, U.S. Standard Liquid Measure. F. DELIVERY PRESSURE. The water shall be delivered by Authority at the point of delivery at a pressure sufficient to transmit tÍ1e 'tlater into the City's distribution system. Section 4. FISCAL PROVISIONS. A. FINANCING. Author- ity will pay for the cost of expanding the Project and will issue its Bonds in amounts necessary to pay for such expansion in accordance, with the Engineering Report. B. .~~NUAL REQUIREMENT. It is acknowledged and agreed that payments to be made under this contract and siillilar con- tracts with other Contracting Parties and Additional Contract- ing Parties will be the only source available to Authority to -4- provide the Annual Requirement; and that the Authority has a statutory duty to establish and from time to time' tÖ revise che charges for services to be rendered and made available to City hereunder so that the F~nual Requirement shall at all ti~es be not less than an amount sufficient to payor provide for the payment 0 f : (a) All Operation and Maintenance Expensei (b) the principal of and the interest on the Bonds, as such principal and interest become duef less interest to be paid out of Bond proceeds as permitted by the Bond Resolutions; (c} duiing each Fiscal Year, the proportionate p~rt, of any speci.al or reserve ,funds requir-:- ed to beest~blished and/or ~aintained by the provisions of the Bond Resolutions; and .,' '. ;. '. (d) an amount in addition thereto sufficient to restore any deficiency in any of such funds or accounts required to be accumulated and maintained by the provisions of the Bond Reso- lutions. C. PAYMENTS BY CITY. (a) For services to be rendered to City by Authority hereunder, City agrees to pay, at the time and in the manner herein provided, its proportionate share of the fu~nual Requirement, which shall be determined as follows and shall constitute City's Annual Payment: (i) For the Fiscal Year 1981 (the first year of opera- tion or fraction thereof), the City's proportionate share of the Annual Requirement shall be a percent- age obtained by dividing City's estimated annual treated water requirement by the total estimated volume to be treated and used by all Contracting Parties. The following tabulation shall apply for the Fiscal Year 1981~ Contracting Party Estimated 1981 Usage Percentage of Total Euless Bedford Colleyville Grapevine North Richland Hills Total 4.1 MGD 2.5 MGD 1. 0 MGD .8 MGD .75 MGD 9.15 MGD 45% 27% 11% 9% 8% 100% City's Annual Payment for the Fiscal Year 1981 shall be calculated by multiplying City's percentage from the above tabulation times the Annual Requirement. City's Annual Payment shall be made to Authority in twelve equal monthly installments. In the event Authority is unable to offer service under this contract to City for the complete Fiscal Year of 1981 the por- tion of City's Annual Payment attributable to Operation and Maintenance Expense shall be reduced to the prorata portion of the Fiscal Year for which service is provided. Such paY~ents shall be made in accordance with and at the times set forth in a Schedule of Pavments for 1981 which will be supplied to City. At the close of the 1981 Fiscal Year, Authority shall determine City's percentage by dividing City's actual metered usage by the total actual metered usage of the System by all Contracting Parties. City's Adjusted Annual Payment shall be calculated by multiplying City's redetermined percentage times the .~~nual -':}- Requirement. The difference between ~he Adjusted Annual Pay- ment and the .~r..ua1 ?3.YTI;en::, 1': ar..y, ~.¡rJ.en determined, shall be applied as a credit or a debit to City's account with Au- thority and shall be credited or debited ::0 City's next sub- sequent monthly statement. . (ii) For the Fiscal Year 1982 and each succeeding Fiscal Year thereafter, City's proportionate share of the Annual Requirement shall be a per- centage obtained by dividing City's estiillated treated water req.uirement for such year by the ·total estima'tedtreated 'water 'requirement of all Contracting Parties for such year. Calculation . of Annual, Payment- and Adj).lsted.:mnual Payment 'for 1982 and each succeeding Fiscal Year there- after shall be determined in the manner describ- ed in (i) above. (b) If, during any Fiscal Year, Authority begins provid- ing services to an Additional Contracting Party or Parties, Ci ty' s Annual Payment for 'such Fiscal Year shall be determined in the fOllowing manner: (i) Such Additional Contracting Party or Parties estimated treated water requirement for such year, or portion thereof, shall be determined by Authority; (ii) City's proportionate share of the Annual Require- ment shall be a percentage, redetermined by di- viding City's estimated treated water requirement by the total annual estimated treated water re- quirement by all Contracting Parties, including that estimated for the Additional Contracting Party or Parties for the remaining portion of such Fiscal Year; (iii) Authority shall redetermine the Annual Require- ment, taking into consideration any costs incurred on account of the Additional Contracting Party or Parties; (iv) City's Annual Payment shall be redetermined by multiplying City's redetermined percentage times the redetermined fuînua1 Requirement; (v) Following the first Fiscal Year or part thereof of service to an Additional Contracting Party, City's Annual Payment shall be determined annually in the manner set forth above, incorporating the Additional Contracting Party in the calculations on the same basis as all parties being served by the System. (c) City's Annual Payment shall also be redetermined, in the manner set out above, at any time during any Fiscal Year if: (i) Additions, enlargemen~s, or improvements to the Project are constructed by Authority to provide continuing service which in turn requires a re- determination of the Annual Requirement; or (ii) Unusual or extraordinary expenditures for main- tenance and operation are required which are not provided for in the Annual Budget or in the Bond Resolution. ,.. -0- (d) Notwithstanding the foregoing provisions of this Section 2C, it is agreed that, in addition to City's Annual Payment, and as further consideration for the service ~b be supplied hereunder, City shall pay to Authority a surcharge of: (i) 2.4 cents. per 1,000 gallons of 'iI!ater delivered to City until City has paid to Authority $393,496 either under this clause (i) or in cash, with such payments being necessary to equalize the capital costs already involved in the Project, plus (ii) seven cents (ìc) per 1,000 gallons of water delivered to City during the term of this Contract, with such payments being necessary because of the greater cost o~ raw water to be furnished to the City under the Raw Water Con- tract; provided that if the water rates are increased or de- creased under the Raw Water Contract in 1980 or following any five year period thereafter, as provided andper:nittec in the ,Raw Watel;' . Contract,. the sUJ:charge unde:r: .thi.s clause, (ii ).,sþalL,... 'be adjust~d'upör d¿~n in proportion t6 any such increase or de- creas~~ It is further' agreed that if, in the futuie, the Author- ity should execute a contract with any Additional Contracting Party,suchcant~act will contain'provi5ions similar 'to the pro~ visions of this subsection (d) except that the surcharge and total amount set forth under clause (i), above, shall be fixed in a fair and equitable manner, as determined by the Authority, to reflect such. party's participation in the Project, with the result that the amounts payable by the other cities to which a surcharge applies will be proportionately readjusted. All pay- ments due from the City under this subsection Cd) shall be billed separately from each Annual Payment, but shall be paid each month at the same time the other monthly payments are due. All payments under this subsection (d) shall be applied to the payment of that part of each Annual Requirement which otherwise would be paid by the Cities of Bedford and Euless, and shall reduce, to such ex- tent, the annual aggregate amount of each Annual Payment to be made by the Cities of Bedford and Euless. (e~ On or before November ~ <?~ ~ªçh year, ?:~~h<?~ity sh~!! -' - furnish City with a schedule of the monthly payments to be made by such City to the Authority for the ensuing Fiscal Year. City hereby agrees that it will make such payments to the Authority on or before the 10th day of each month of such Fiscal Year. If the City at any time disputes the amount to be paid by it to Authority, City shall nevertheless promptly make the payment or payments determined by Authority, and, if it is subsequently determined by agreement, arbitration or court decision that such disputed payments made by City sh~ld have been less, or more, Authority shall promptly revise and reallocate the charges among all parties then being served by Authority in such manner that Ci ty will reCOver its overpayment or Authori ty '.viII recover the amount due it. " (f) If City's Annual Payment is redetermined as is herein provided, Authority will promptly furnish City with an updated schedule of monthly payments reflecting such redetermination. Section 5. SPECIAL PROVISIONS. (a) Authority will pro- ceed to finance and expand the Project to the end that it will be able to deliver treated water to City beginning on June 1, 1981. (b) Title to all water supplied hereunder shall remain in Authority through the Point(s) of Delivery, and upon passing through the Point(s) of Deliverv, such title to the water shall pass to City. Each of the parties hereto agrees to save and hold the other party harmless from all claL~s, d~~ands, and causes of action which may be asserted by anyone on account of the transportation and delivery of said water while title re- mains in such party. (c) It is expressly understood and agreed that any obli- gations on the part of Authority to complete the expansion of the Project and to provide water to City shall be conditioned upon the Authority's ability to obtain all necessary material, labor, and equipment and upon the ability of Authority to fi- nance the cost of such expansion through the actual sale of Authority's Bonds. -ì- td) ~uthority shall never have the right to demand pay~ ment by City of any obligations assumed by it or imposed on'it under and by virtue. of this Contract from funds raised or to be raised by taxes levied by City. City's obligations under this Contract shall never be construed to be a debt of the City of such kind as to require it under the law of this State to levy and collect a tax to discharge such obligation, it be- ing expressly understood by the parties hereto that all pay- ments due by City hereunder are to be made from water and sewer revenues received by City. (e) City represents and covenants that all payments to be made hereunder by it shall constitute "Operating Expenses" of its waterworks and sewer system as defined in Article 1113 of the Revisèd Civil' Stàbitesof Texas, as' amended, ånd that. 'all such þaymen tswi'Il constitute operating expenses of Ci ty' s waterworks and sewer system. {f) City agrees to fix and collect such rates and ch~rges for water and sewer services to be supplied by its waterworks and sewer system as will produce revenues in an amount suffi- cient to make all payments due under this Contract and to com- ply with provisions of all ordinances authorizing its revenue bonds now or hereafter outstanding. (g) It is agreed and understood that the Authority will supply, and City is obligated to take and shall take, annually under this Contract, an amount of water equal to the amount of all water actually required to serve all of the City's water customers in the area of the City described as follows: All area within the City bounded on the west by Rufe Snow Drive, bounded on the south by the Texas Electric Service Company transmission line right of way, bounded on the east by Precinct Line Road, and bounded on the north by the northern city limit line of North Richland Hills. However, it is understood that in order for the City to supply water to all of its water customers throughout the City, and in certain instances to meet the limiting ratio of maximum day's use to average annual use stipulated in the heretofore described Raw Water Contract between Authority and Tarrant County Water Control and Improvement District Number One (the "District"), the City will utilize other sources of water supply available to it for such purposes. Also, at such times as peak demands on the City's water may exceed the capabilities of the Authority's facilities to deliver treated water, or at such times as the Authority's facilities may be totally or partially out of service, the City shall utilize such other sources of water supply. (h) Authority shall not be liable to City for any damages occasioned by the inability of Authority to supply all water required by City if such inability is caused by the inability of District to deliver all water required by Authority to meet its contractual obligations. (i) In the event Authority is sued or is placed on notice of demand for payment of a claim or claims not covered by Au- thority's insurance or claims not paid by a Contracting Party or Parties arising in connection with the operation and main- tenance of the Project, then in any of said events, Authority shall forthwith notify City in writi~g as to the nature of the claim or litigation which could result in an increase in opera- tion and maintenance expense. City shall have ten (10) days from receipt of such written notification in which to advise and comment to Authority concerning any claim, suit or demand for payment and Authority shall duly consider City's advice and comments in any final disposition of said claim or demand for payment. Section 6. FORCE MAJEURE. (a) If by reason of force majeure either party hereto shall be rendered unable wholly or in part to carry out its obligations under this Contract, other than the obligation of City to make the payments required under (b) of this section, then if such party shall give notice and -8- full particulars of such force :naj eure in wri ting to the ot.'1er party within a reasonable time after occurrence of the event or cause relied on, the obligation of the party giving such notice, so far as it is affected by such force majeure, shall be suspended during the continuance of the inability then claimed, but for no longer period, and any such party shall endeavor to remove or overcome such inability with all reason- able dispatch. The term "Force Majeure" as employed herein shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of public enemy, orders of any kind of the .Goverf\..m~nt,ofthe UnitedSt.ates or the. Sta.te of Texas, or, any Ci viI or rri.ili tary aUthori ty-, . insurrection, rio ts, epidernics, Ì-ànd'sIides, lightning,' earthquake, fires, hurricanes, storms, floods, washouts, drouths, arrests, restraint of government and people', civil disturbances, explosions, breakage or:!.cci'...; dents ·to machinery, pipelines or canals, partial or entire failure of water supply, and inability on part of Authority to deliver water hereunder for any reason, or the City to receive water hereunder for any reason, or on account of any other causes not reasonably within the control of the party claim- ing such inability. (b) Recognizing that the Authority will use payments received by City and others to pay, secure, and finance the issuance of the Bonds, it is hereby agreed that upon the issu- ance and sale of any Bonds by the Authority to provide funds for the Project, City shall be unconditionally obligated to pay its proportionate share of the debt service on such Bonds, regardless of whether or not the Authority is actually deliver- ing water to City hereunder, or whether or not City actually takes water hereunder, whether due to Force Majeure or other- wise. Under such circumstances, the amount due to Authority from City shall be a percentage of the debt service on the Bonds for the period of any such failure of service hereunder. Such percentage shall be the last percentage used by Authority in determining City's Annual Payment prior to any such failure of service, and, in the event service is not begun hereunder, such percentage shall be that specified in the table in Section 4C (a) (i) hereof. This covenant by City shall be for the benefit of the holders of the Bonds. Section 7. LIMITATION OF AUTHORITY OBLIGATION. This con- tract is in all things subject to the Raw Water Contract and the other water supply contract, effective July 2ì, 1971, be- tween Authority and Tarrant C0unty Water Control and Improve- ment District Number One. Bv the execution of this Contract, City acknowledges that it ha~ received and reviewed true copies of such contracts. City agrees that it will take no action which would cause a violation of Authority's contract with said Di.3trict. In the event that the amount of 'water avail- able to Authority under its contracts with said District is in- sufficient to supply all requirements of City, City may utilize water from other sources to fulfill its needs in amounts which Authority is unable to supply. Section 8. TERM OF CONTRACT; MODIFICATION; NOTICES. A. TERM OF CONTRACT. This Contract shall be effective upon execution hereof and shall continue in force and effect for a period of thirty-five (35) years from the date of this Contract and thereafter shall continue in e~fect until all Bonds and refunding bonds issued in lieu of the Bonds have been paid. B. MODIFICATION. No change or modification of this Con- tract shall be made which will affect adversely the prompt pay- ment when due of all moneys required to be paid by City under -9- the ter~s of this Contract and ~o such change shall be effective which would cause a violation of any provisions of any resolu- tion of Authority authorizing the issuance of Bonds or any bonds issued to refund any of the Bonds. C. NOTICES. All notices or communications provided for herein shall be in writing and shall be either delivered to City or Authority, or, if mailed, shall be sent by registered mail, postage prepaid, addressed to City or Authority at their "respective addresses'. '. ',' . . . D. SEv~RABILITY. The parties hereto agree that ~L any of the" provisions' Otthis, Contract should be or beheld to be invalid or to contravenè the laws of this State, or the United States, such fact shall not invalidate the whole agreement, but it shall be construed as though not containing that particular provision, and the rights and obligations of the parties shall be construed and remain in force accordingly. E. CONTINUED SERVICE'. The parties hereto agree that upon the expiration of this Contract that City shall have the right to continued service for an additional period of fifty (50) years, or for such other time as may be agreed, upon ex- ecution of an appropriate agreement between City and Authority. IN WITNESS WHEREOF, the parties hereto acting under au- thority of their respective governing bodies have caused this Contract to be dulv executed in several counterparts, each of which shall constitute an original, all as of the day and year first above written. ::I¡P~;~ General Manager A TTES T :///'j ~.~~~ Secretary (AUTHORITY SEAL) CITY OF NORTI RICHLAND HILLS, TEXAS / BY l.. ATTEST: ~cr:f?¿~ (CITY SEAL) -10-