Epcor - El Mirage Franchise Agreement 060722

FRANCHISE AGREEMENT BETWEEN 
EPCOR WATER ARIZONA INC., 
AND 
CITY OF EL MIRAGE, ARIZONA 
 
This FRANCHISE AGREEMENT (“Agreement”), is made and entered into as of the ___ day 
of ________ , 2022 (Effective Date), between EPCOR Water Arizona Inc. an Arizona 
corporation, or its successors and assigns (“EPCOR”) and City of El Mirage, an Arizona 
municipal corporation (“City”). 
 
RECITALS 
 
A. EPCOR represents and warrants to the City that it is a public service corporation within 
the meaning of Article 15, Section 2, of the Arizona Constitution and is authorized to 
provide potable water and wastewater services within portions of Maricopa County, 
Arizona, in accordance with a Certificate of Convenience and Necessity (“CC&N”) 
issued by the Arizona Corporation Commission (“Commission”). 
 
B. EPCOR will own, operate and maintain public water and wastewater systems within the 
City limits of El Mirage. 
 
C. EPCOR and City agree and acknowledge that the Recitals set forth above are true and 
correct and are by this reference incorporated herein. 
 
AGREEMENT 
 
NOW, THEREFORE, in consideration of the mutual covenants contained in this agreement, the 
parties, each intending to be legally bound by this agreement, hereby agree as follows: 
 
 
 
Grant of Franchise  
 
A. EPCOR will present the desired franchise ("Franchise") to the City's governing body and   
file it with City Clerk after entry of a final order granting EPCOR an extension of its 
Certificates of Convenience and Necessity (“CC&Ns”) by the Arizona Corporation 
Commission that grants EPCOR the exclusive right to provide Utility Services in an area 
within the Subject Territory as described in the CC&Ns.

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B. If the City's governing body deems the granting of the Franchise beneficial to the City, it 
will pass a resolution and thereafter submit the Franchise to the qualified electors as to 
whether the Franchise should be granted at the next regular election held in the City or at 
a special election called for approving the Franchise. The City will not call a special 
election for approving the Franchise without the consent of EPCOR. The Franchise 
election will be called and conducted in accordance with applicable law. 
 
C. EPCOR will be responsible for all costs incurred by the City for holding a general election 
to approve the Franchise, provided that such costs will not be unreasonably incurred by 
the City.  If other items, measures, initiatives or candidates are placed on the same ballot 
as the Franchise, the City will equitably apportion only those costs attributable to the 
election of the Franchise to EPCOR.   
 
D. The City will invoice the estimated cost of the general election for the Franchise 
("Estimated Cost") within 60 days after the filing of the Franchise with the El Mirage 
City Clerk.  EPCOR will promptly pay the City the estimated cost within 30 days after 
receiving the invoice. The City will reconcile the actual general election cost attributable 
to the Franchise ("Actual Cost”) Within 60 days after the Franchise vote in a general 
election.   EPCOR will promptly pay the City the difference between the Estimated Cost 
and the Actual Cost if the Actual Cost exceeds the Estimated Cost.   The City will 
promptly refund EPCOR the difference between the Actual Cost and the Estimated Cost 
if the Actual Cost is less than the Estimated Cost.

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E. The Franchise filed by EPCOR, at a minimum, must contain the following provisions: 
 
1. Franchise Agreement. 
 
This franchise is hereby granted by City to EPCOR, a corporation organized and existing 
under and by virtue of the laws of Arizona, and conveys to EPCOR the right and privilege 
to construct, maintain, and operate within the present and future public rights-of-way 
(including – but not limited to – streets, alleyways, highways, and bridges) in the 
Franchised Area (as defined below) in El Mirage, Arizona, potable water delivery and 
wastewater collection systems, together with certain appurtenances (including – but not 
limited to – transmission mains, distribution and collection mains, service lines, fire 
hydrants, meters, lift stations, and equipment for its own use) for the purpose of supplying 
potable water and wastewater services to City, its successors, the inhabitants thereof, and 
all individuals and entities within or beyond the limits thereof (collectively, the “Served 
Population”), and for collecting wastewater from the Served Population, in each case for 
all purposes for which it is duly authorized by its CC&Ns (“Franchise”).  For purposes 
of this Franchise, the “Franchised Area” shall consist of those portions of the area within 
the then effective borders of City that are also within the boundaries of any of EPCOR’s 
then effective CC&Ns, as granted by the Commission.  The Franchised Area as of the 
date of this Franchise provides the ability to construct, maintain and operate its system, 
as defined herein, upon, over, along, across and under the present and future public rights-
of-way. These rights-of-way include but are not limited to streets, alleys, ways and 
highways in the City of El Mirage, Arizona (herein called "City"). This Franchise is for 
EPCOR's use of City's public rights-of-way to supply and deliver safe, adequate and 
reliable water treatment, transmission, and distribution services, and to provide safe and 
reliable wastewater collection, transmission and treatment services to City, its successors, 
the inhabitants thereof, and all individuals and entities either within or beyond the limits 
thereof, for all purposes. 
 
All such transmission mains, distribution and collection mains, and service lines shall be 
located underground unless otherwise approved by City.  EPCOR shall not construct 
wells, well sites, storage, or pumping facilities in the public rights-of-way.  Nothing 
herein shall be construed to permit EPCOR to maintain any portion of its potable water 
delivery system or wastewater collection system, or appurtenances thereto, in any manner 
which would adversely affect or interfere in any way, as determined by City in its sole 
discretion, with City’s use of the public rights-of-way for its intended use; provided, 
however, that the foregoing shall not preclude reasonable temporary interference 
necessitated by EPCOR’s repair or maintenance of those facilities.  City acknowledges 
and agrees that all of EPCOR’s infrastructure located within the Franchised Area as of

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the date of this Franchise complies with the foregoing or is otherwise acceptable in its 
current location to City. 
 
2. EPCOR’s Compliance with Requirements; Plans Submitted for Approval; City 
Construction near EPCOR’s Facilities.  
  
A. The quality of water treatment, transmission, and distribution services, and of the 
wastewater collection, transmission and treatment services provided by EPCOR shall 
comply with the requirements of the United States Environmental Protection Agency, 
Arizona Department of Environmental Quality, Arizona Corporation Commission, 
Arizona Department of Health Services, and the Maricopa County Department of 
Environmental Health Services. 
 
B. All construction under this Franchise shall be performed in accordance with 
established practices for City with respect to such public rights-of-way.  Before 
EPCOR makes any major installations in the public rights-of-way, EPCOR shall 
submit for approval any applicable permit applications and a map showing the 
location of such proposed installations to City.  .  City and EPCOR agree and 
understand that there may be instances when EPCOR is required to make repairs that 
are of an emergency nature.  EPCOR shall notify City prior to such repairs, to the extent 
practicable, and shall obtain the necessary permits in a reasonable time after 
notification, showing the work performed in the public rights-of-way In this case, 
telephone notification of the repair will be given as soon as practicable to the contact 
person designated by City. Within ninety (90) days after the approval of this 
Franchise by the Mayor and Council of City, EPCOR shall submit to City’s City 
Manager a map showing the true and correct location of all present installations of 
EPCOR within City’s rights-of-way.  If City undertakes, either directly or through a 
contractor, any construction project adjacent to or near EPCOR’s facilities operated 
pursuant to this Franchise and for the relocation of which City is required hereunder 
to pay, City shall include in all such construction specifications, bids, and contracts a 
requirement that as part of the cost of the project, the contractor or contractor’s 
designee obtain from EPCOR the temporary or permanent removal, relocation and 
barricading of equipment, and depressurization of EPCOR’s facilities or equipment, 
all as necessary to avoid the creation of an unsafe condition in view of the equipment 
to be utilized or the methods of construction to be followed by the contractor. 
 
C. Mapping Requirement. EPCOR shall maintain As-Built Drawings of its facilities 
located within the ROW and furnish a copy both electronically in a mapping format 
compatible with the current City electronic mapping format as specified by the City 
and in hard copy form.

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3. Construction and Relocation of EPCOR’s Facilities: Payment.   
 
A. All facilities installed or constructed pursuant to this Franchise shall be so located or 
relocated and so erected as to minimize the interference with traffic or other 
authorized use over, under, or through the public right-of-way.  Those phases of 
construction of EPCOR’s facilities relating to traffic control, backfilling, compaction, 
and paving – as well as location or relocation of facilities herein provided for – shall 
be subject to regulation by the City Council.  EPCOR shall keep accurate records of 
the location of all facilities in the public right-of-way and furnish them to City upon 
request.  Upon completion of new or relocation construction of underground facilities 
in the public right-of-way, EPCOR shall provide City with corrected drawings 
showing the actual location of the underground facilities in those cases where the 
actual location differs significantly from the proposed location approved in the permit 
plans. 
 
B. If City requires EPCOR to relocate EPCOR’s facilities that are located in private 
easements or private rights-of-way from which the facilities must be relocated, the 
entire cost of relocating EPCOR’s facilities (including the cost of purchasing a new 
private easement or right-of-way, if necessary) shall be borne by City.  City shall not 
be obligated to bear such costs under this paragraph B if, prior to City’s acquisition 
of such right-of-way, either: (i) EPCOR subordinated its easement or right-of-way in 
such a manner that the person from whom City acquired the right-of-way would not 
have been obligated to bear any costs of such relocation, or (ii) EPCOR did not in 
fact obtain such easement or right-of-way. 
 
C. Except as covered in Paragraphs B or D of this section, EPCOR shall bear the entire 
cost of relocating its facilities located on public rights-of-way. 
 
D. If the City, at its expense, has previously required EPCOR to relocate its facilities in 
a particular area, and EPCOR desires to again relocate these facilities, EPCOR shall 
bear the entire cost of such relocation. City will bear the entire cost of relocating any 
of EPCOR’s facilities, the relocation of which is necessitated by the construction of 
improvements by, or on behalf of, City in furtherance of a proprietary function. 
 
E. Representatives of the City and EPCOR shall endeavor to, during the entire term of this 
Franchise, meet at least once in each calendar year, or more often if necessary, to review 
any projects involving the construction or modification of the City’s Rights-of-Way.  
The City shall provide EPCOR annually with a 5-year capital improvement plan, in 
order for both parties to adequately plan and budget for such actions and to determine

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the extent of work required of EPCOR, if any, for such projects. So long as the City 
provides EPCOR with its 5-year capital improvement plan on at least an annual basis, 
EPCOR agrees to be precluded from cutting any new or reconstructed street for a two 
(2) year period following completion of such new or reconstruction except when 
authorized by the City Engineer. 
 
F. Prior Occupancy. Provided that anything contained herein does not interfere with 
EPCOR’s obligation to provide safe and reliable water and wastewater service, any 
privilege claimed under this Franchise by EPCOR in any Public Street or other public 
property is subordinate to any: (a) prior or subsequent lawful occupancy or use thereof 
by the City or any other governmental entity; (b) prior lawful occupancy or use thereof 
by any other Person; and (c) prior easements therein.  Notwithstanding the foregoing 
subordination provision, nothing herein extinguishes or otherwise interferes with 
property rights established independently of this Franchise. 
 
G. If City participates in the cost of relocating EPCOR’s facilities for any reason, the 
cost of relocation to City shall not include any additional cost resulting from any 
upgrade or improvement of EPCOR’s facilities as they existed prior to relocation.  
Notwithstanding the foregoing, if EPCOR requests, in connection with any such 
relocation by City, any upgrade or improvement of the affected EPCOR’s facilities, 
City will in good faith consider such request, subject in each case to EPCOR’s 
agreement to reimburse City for the actual, additional costs incurred by City for the 
requested upgrade or improvement.  City will deliver to EPCOR documentation 
reasonably satisfactory to EPCOR to evidence the actual, additional cost of such 
upgrades and improvements.   
 
H. Subject to the provisions of the foregoing paragraphs 3 (B), (C), and (D) regarding 
the cost of relocation of EPCOR’s facilities, EPCOR’s right to retain its facilities in 
their original location is subject to the paramount right of City to use its public rights-
of-way for all permitted purposes, which shall include, but shall in no way be limited 
to, the following functions of City: 
 
i. 
Any and all improvement to City streets, alleys, and avenues; 
ii. 
Establishing and maintaining sanitary sewers, storm drains, drainage 
structures, and related facilities; 
iii. 
Establishing and maintaining parks, parkways, pedestrian malls, or grass, 
shrubs, trees, and other vegetation for the purpose of landscaping any 
street or public property; 
iv. 
Providing fire protection; 
v. 
Collection and disposal of garbage;

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vi. 
structures for public purposes deemed appropriate by the Mayor and 
Council of City; 
vii. 
Any structure for any purpose, whether governmental or proprietary, 
which City is authorized to construct and/or maintain. 
 
4. Restoration of Rights of Way. 
 
Subject to the provisions of the foregoing paragraphs 3 (B), (C), and (D) regarding the 
cost of relocation of EPCOR’s facilities, (i) whenever EPCOR shall cause any work, 
opening, or alteration whatsoever to be made for any purpose in any City public right-of-
way, the work shall be completed with due diligence within a reasonably prompt time; 
and EPCOR shall, upon completion of such work, restore the disturbed property to as 
good condition as it was in prior to such openings or alteration, and (ii) EPCOR shall 
provide any barricades, signing, rerouting of traffic, or other actions which City shall 
consider necessary or desirable in the interest of public safety during any such opening 
or alteration within the public right-of-way. 
 
A. Street Repair. If EPCOR causes damage to pavement, sidewalks, driveways, 
landscaping, or other property during construction, installation, or repair of its facilities, 
EPCOR or its authorized agent shall replace and restore such places as nearly as 
possible to its original condition that existed before the damage occurred.  If the repair, 
replacement or restoration cannot replicate the site’s original condition, EPCOR shall 
return the site to a condition that approximates the original condition and compensate 
the City for any difference. All repair and restoration necessary to meet the 
requirements set forth in this Section shall be at EPCOR's expense and shall be 
conducted in a manner acceptable to the City, in its sole unreviewable discretion. For 
any pavement or sidewalk cuts by EPCOR, EPCOR agrees to restore the pavement or 
sidewalks. 
 
B. Damage to Public Property. In addition to any indemnity obligation under this 
Franchise, whenever the installation, use, maintenance, removal, or relocation of any 
of EPCOR facilities are required or permitted hereunder, and such installation, removal 
or relocation damages or disturbs the surface or subsurface of any ROW or public 
property or any public improvement that may be located thereon, therein, or thereunder, 
however such damage or disturbance was caused, EPCOR, at its sole cost and expense, 
shall promptly restore the surface or subsurface of the ROW or public property and/or 
repair or replace the surface, subsurface and/or public improvement therein, or 
thereunder, in as good a condition as before in accordance with applicable laws, normal 
wear and tear excepted, reasonably satisfactory to the City Engineer. If EPCOR does 
not repair the damage or disturbance as just described, then City shall have the option,

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upon ten (10) business days’ prior written notice to EPCOR, to perform or cause to be 
performed such reasonable and necessary work on behalf of EPCOR and to charge 
EPCOR for work performed in accordance with the City’s fee schedule in place at the 
time the work is performed plus a ten percent (10%) administration fee. 
 
C. Public Safety / Public Emergency. Notwithstanding the notice provision above, in the 
event of a public emergency, the City shall have the right to immediately perform, 
without prior written notice to EPCOR, such reasonable and necessary work on behalf 
of EPCOR to repair and return public property to a safe and satisfactory condition in 
accordance with applicable laws, normal wear and tear excepted, reasonably 
satisfactory to the City Engineer. The City shall provide written notice to EPCOR of 
the repairs as soon as practicable after the work has begun. EPCOR agrees that any 
damaged City-owned Conduit or fiber must be replaced or repaired and restored with 
new or like-new materials. If the City needs to perform any part of the necessary 
repairs, relocation and/or removal work, it shall be entitled to seek payment for such 
repairs and/or relocation and/or removal costs from EPCOR Upon the receipt of a 
demand for payment by City, EPCOR shall, within thirty (30) days, reimburse City for 
such costs in accordance with the City’s fee schedule in place at the time the work is 
performed plus a ten percent (10%) administration fee. In the event of a public 
emergency, neither the City nor any agent, contractor or employee of the City shall be 
liable to EPCOR or its Contractors or its customers or other third parties for any harm 
so caused to them by the reasonable actions of the City or its agents, contractors or 
employees in reasonably responding to such public emergency. When practical and if 
possible, City will consult with EPCOR in advance to assess the necessity of such 
actions and to minimize, to the extent practical under the circumstances, damage to and 
disruption of either the public property involved or the EPCOR’s facilities involved. 
 
i. EPCOR Facilities / Cooperation with City. If any of EPCOR’s facilities or activities 
present any immediate hazard or impediment to the public, to the City, to other City 
improvements or activities within or outside of the Route, or to City’s ability to 
safely and conveniently operate the ROW or perform City’s utility, public safety 
and/or other public health, safety and welfare functions, then EPCOR shall 
immediately remedy the hazard, comply with City’s request to secure the route 
area, and otherwise cooperate with City at no expense to City to remove any such 
hazard or impediment.   
 
5. Indemnification/Insurance.   
 
A. Indemnification. EPCOR agrees to indemnify and hold harmless City and any of its 
departments, agencies, officers, employees, elected officials, and representatives from

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all damages, claims, or liabilities and expenses (including attorney’s fees) to the extent 
arising out of, or resulting in any way from EPCOR’s performance or failure to perform 
the services required of EPCOR under the terms of this Agreement and caused by 
negligent or intentional acts, errors, mistakes or omissions of EPCOR, its officers, 
employees, or other for whose acts that EPCOR may be legally liable. 
 
B. Insurance. During the term of this Franchise, and for such other term that any claims 
may be brought, EPCOR shall maintain in full force and effect, at no cost or expense 
to the City, commercial general liability insurance in the amount of five million 
dollars combined single limit for bodily injury and property damage. The City shall 
be designated as an additional named insured. Such insurance will not be cancelable 
except upon thirty (30) days prior written notice to the City. Annually, EPCOR shall 
provide a certificate of insurance showing evidence of the coverage required by this 
Section.  EPCOR may self-insure the above- described- policy coverages if EPCOR 
or its parent is of sufficient financial standing to provide such insurance.   Should 
EPCOR elect to self-insure, the City in its sole discretion may accept or reject 
EPCOR’s proposal to self-insure. 
 
C. Coverage. EPCOR shall secure and maintain during the term of this Franchise, 
insurance coverage which shall include statutory workers’ compensation, 
comprehensive general, and automobile liability, all including contractual liability 
assumed by the insured.  The comprehensive general and automobile limits shall be 
no less than five million U.S. dollars ($5,000,000) per occurrence (combined single 
limit), including bodily injury and property damage, and in an amount not less than 
five million U.S. dollars ($5,000,000) annual aggregate for each personal injury 
liability and products-completed operations.  City shall be named as an Additional 
Insured with respect to all operations of the insured and EPCOR’s insurance policy 
shall contain a waiver of subrogation against City, its departments, agencies, boards, 
commissions, officers, officials, agents, and employees for losses arising from the 
service provided by or on behalf of EPCOR in the event the EPCOR is found to be 
solely negligent.  Insurance coverage must be provided by an insurance company 
admitted to do business in Arizona and rated A-VII or better by AM Best’s Insurance 
Rating.  Subsequently, a certificate of insurance, signed by an authorized 
representative of the insurer with 30 days’ notice of cancellation or non-renewal, shall 
be presented a minimum of five (5) days after the date of expiration of the policy 
term.  In the event EPCOR fails to provide such certificate of coverage, City may – 
but shall not be required to – purchase insurance if available, to protect itself against 
any losses.  If City elects to purchase the insurance under the provision, City shall 
provide EPCOR with at least five business days’ prior written notice and EPCOR 
shall be liable to City for all costs incurred by City for purchasing such insurance.

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D. Certificate of Insurance. EPCOR shall submit to City Clerk’s Office, El Mirage, AZ 
- a certificate of insurance, evidencing the coverage and limits stated in the foregoing 
paragraph within ten (10) days of award of this Franchise.  Insurance evidenced by 
the certificate shall not expire, be cancelled, nor non-renewed without thirty (30) 
days’ prior written notice to City Clerk’s Office, El Mirage, AZ.  A statement to that 
effect must appear on the face of the certificate, and certificate shall be signed by a 
person authorized to bind the insurer.   
 
6. Franchise Fee. 
 
A. EPCOR agrees to pay City in consideration of the grant of this Franchise a sum equal 
to three percent (3%) of the gross receipts1 of EPCOR from the sale by it of water 
within the Franchised Area, and from the collection and/or treatment by it of 
wastewater within the Franchised Area as shown by EPCOR’s billing records (the 
“Franchise Fee”).  The Franchise Fee shall be due and payable quarterly and shall be 
in lieu of all fees or charges for permits or Franchises issued for the construction of 
EPCOR’s facilities hereunder or for the inspection thereof exclusive of costs and 
reimbursements identified in this agreement.  For the purpose of verifying the amounts 
payable hereunder, the books and records of EPCOR shall be subject to inspection by 
duly authorized officers or representatives of City at reasonable times and places, and 
in the event that such inspection evidences that the Franchise Fee actually paid for any 
quarter is more than ten percent (10%) below the amount that should have been paid 
for such quarter, EPCOR shall reimburse City for the costs of such inspection. If at any 
time Franchisee is paying any municipality in the State of Arizona a Franchise Fee 
greater than three percent (3%) of Franchisee’s gross receipt in such municipality, then 
the percentage set forth in this Section shall be increased to match the greater 
percentage amount Franchisee is paying to such other municipality pursuant to a 
franchise agreement; provided, however, that if City requests EPCOR to match such 
greater Franchise Fee, then EPCOR may request that all terms and conditions contained 
within the franchise agreement that is applicable to the other such municipality be fully 
adopted by City in this Franchise.  In addition to the foregoing Franchise Fee, 
Franchisee shall pay charges, taxes and fees as described in the Franchise. 
 
 
1 "Gross Receipts” or “Gross Revenues" means all cash, credits, property of any kind or nature, or other 
consideration, less related bad debt not to exceed one and one-half percent annually, that is received directly or 
indirectly by EPCOR, its affiliates, subsidiaries or parent or any person, firm or corporation in which EPCOR has a 
financial interest or that has a financial interest in EPCOR and that is derived in whole or in part from EPCOR’s 
provision of water, sewer, and wastewater services to its end-use customers within the franchise boundaries in the 
City.

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B. Subject to the provisions of this Agreement, the amount payable under the Franchise 
Fee shall not be reduced by reason of the payment of any general ad valorem taxes, 
assessments for special improvements such as general sales or transaction privilege 
Franchise taxes, or any similar general tax or levy. 
 
7. Franchise Fee Audit. 
 
A. Upon written notice to EPCOR, City may inspect Franchise's records of Gross 
Revenues, and City shall have the right to audit any amounts determined to be payable 
under this Franchise; provided, however, that such audit must take place within thirty-
six (36) months following the close of Franchise's fiscal year for which the audit is 
desired. 
 
B. Upon completion of an audit, City shall provide EPCOR with written notice including 
a copy of the audit report and setting forth any additional amounts due to City identified 
in the audit.  EPCOR shall pay any deficiency within thirty (30) days following such 
written notice; provided, however, that EPCOR will not be required to pay such 
deficiency until thirty (30) days after completion of the administrative hearing process 
if EPCOR commences such process pursuant to applicable administrative rules and 
regulations.  If a City audit shows overpayments, City shall promptly pay EPCOR the 
overpaid amount. 
 
C. If EPCOR determines in an internal audit that it overpaid Franchise Fees, EPCOR may 
request a credit or refund by submitting a written claim for credit or refund for the 
overpaid Franchise Fees along with the audit report/calculations detailing the 
overpayment.  A credit or refund claim must identify (i) the dollar amount of the credit 
or refund requested, (ii) the specific Franchise Fee period(s) involved, and (iii) the 
specific grounds upon which the claim is based.  No credit shall be allowed or refund 
paid except for those Franchise Fees paid in excess of the amount due within the 
limitation period. The credit or refund limitation period shall be calculated from the 
date the City receives EPCOR’s written claim meeting the requirements of this 
Paragraph C.  
 
i. The following additional requirements apply to the City and EPCOR for claims for 
credit or refund submitted pursuant to this Paragraph C. The City may request, in 
writing, additional information or documentation from EPCOR to support the 
requested credit or refund. Such information or documentation must be reasonably 
related to the claim and required to be maintained in the normal course of business.

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ii. Upon denial of all or part of a claim, or if the City fails to issue a determination 
within three (3) months after the later of either receiving the claim or receiving any 
requested additional information or documentation pertaining to the claim, EPCOR 
may then consider the claim for credit or refund denied and may commence the 
administrative hearing process under Paragraph B of this Section 7.    
 
iii. In no event shall interest accrue or either Party be entitled to interest on unpaid 
amounts until thirty (30) days after a final decision is rendered from the 
administrative hearing process.  
 
 
8. Term. 
 
A. This Effective Date of this Franchise shall be the first day of the calendar month 
immediately following the calendar month in which this Franchise is approved by the 
qualified electors of City. This Franchise shall continue and exist for a period of twenty-
five (25) years from the Effective Date.  
 
B. The right, privilege, and franchise hereby granted shall continue and exist for a period 
of twenty-five (25) years following the Effective Date; provided, however, that either 
party may reopen any or all sections for further review and possible amendment of this 
Franchise, on its fifth (5th) or twelfth (12th) anniversary, by giving written notice of its 
intention to do so not less than one (1) year before the fifth (5th) or twelfth (12th) 
anniversay.  Any such amendment will be subject to any applicable requirements for 
approval by the qualified electors of City.  Neither party is bound to enter into any 
amendment to this Agreement unless it, in its sole discretion, elects to do so.  No refusal 
to enter into an amendment to this Agreement will effect the on-going validity or 
effectiveness of this Agreement. 
 
C. Unless terminated earlier by written agreement of the parties, this Franchise will expire 
on the twenty-fifth (25th) anniversary of the Effective Date.  EPCOR shall comply with 
all federal, state, and local laws and ordinances, including those that may come into 
being, in its exercise of Franchise rights.   
 
9. Default; Dispute Resolution. 
 
A. Failure or unreasonable delay2 by any Party to perform any term of provision of this 
Franchise for a period of ten (10) days after written notice thereof from another Party 
shall constitute a default under this Franchise.  If the default is of a nature which is not 
 
2 “Unreasonable delay” defined as delay of action of more than 90 days.

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capable of being cured within ten (10) days, the cure shall be commenced within such 
period, and diligently pursued to completion.  The notice shall specify the nature of the 
alleged default and the manner in which the default may be satisfactorily cured.  In the 
event of a default hereunder by any Party, the non-defaulting Party shall be entitled to 
all remedies at both law and in equity, including, without limitation, specific 
performance. 
 
B. To further the cooperation of the parties in implementing this Franchise, City and 
EPCOR each shall designate and appoint a representative to act as a liason between 
City and its various departments and EPCOR.  The initial representative for City (the 
“City Representative”) shall be the City Manager or designee, the initial representative 
for EPCOR shall be its Director of Operations, as identifed by EPCOR from time to 
time (the “EPCOR Representative”).  The representatives shall be available at all 
reasonable times to discuss and review the performance of the Parties and the 
development of property. 
 
C. If a dispute arises out of or related to this Franchise or breach thereof, EPCOR and City 
agree first to try to settle the dispute through mediation before resorting to arbitration, 
litigation, or some other dispute resolution.  In the event that the Parties cannot agree 
upon the selection of a mediator within seven (7) days, either Party may request a 
presiding judge of the Superior Court to assign a mediator from a list of mediators 
maintained by the Arizona Muncipal Risk Retention Pool.  If a dispute arises out of or 
relates to this Franchise, or the breach thereor, and if the dispute cannot be settled 
through negotiation, EPCOR and City agree first to try to settle the dispute through 
mediation before resorting to litigation, arbitration, or some other dispute resolution 
procedure.   
   
10. Non-Exclusive.   
 
This Franchise is not exclusive, and nothing herein contained shall be construed to prevent 
City from granting other like or similar grants or privileges to any other person, firm, or 
corporation. 
 
11. Transfer of Franchise.  
 
The right, privilege, and franchise hereby granted may be transferred in whole or in part 
by EPCOR, its successors and assigns, to any public service corporation approved by the 
Commission to provide public utility water or wastewater services within the Franchised 
Area and upon payment of an appropriate transfer fee to City to reimburse City for any 
reasonable costs it incurs in processing the transfer.  No other assignment of any rights,

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privileges or franchise hereby granted may be made without the prior written consent of 
both the City Council and the Commission and payment of an appropriate transfer fee to 
City to reimburse City for any reasonable costs it incurs in processing the transfer. The 
City Council’s consent shall not be unreasonably withheld, conditioned or delayed. No 
consent shall be required in connection with an assignment made as security pursuant to a 
mortgage or deed of trust or in connection with subsequent transfer made pursuant to any 
such instrument. 
 
12. Title to Facilities; Right to Use Easements; Reserved Right to Purchase or Condemn. 
 
A. Title to all water and wastewater utility facilities wherever situated on public grounds 
or in easements for public utility purposes (i.e., the provision of water and wastewater 
services) acquired or installed by EPCOR or its agents or contractors within its service 
territory shall be and remain property of EPCOR, its successors, or assigns. 
 
B. Nothing contained in this Franchise shall be construed as preventing, diminishing, or 
restricting EPCOR from using for public utility purposes any easement shown on any 
plat or plats of any portion of City before or hereafter platted or recorded that has been 
or may hereafter be created, granted, or dedicated for public utility purposes by any 
person, firm, or corporation. The costs associated with such use shall be borne by 
EPCOR.  
 
C. City reserves the right and power to purchase and condemn the plant and distribution 
facilities of EPCOR within the corporate limits or any additions thereto, as provided by 
law. EPCOR likewise reserves all rights and remedies provided by law in any such 
circumstance. 
 
D. In the event of a purchase of EPCOR or under the exercises of eminent domain, this 
Franchise shall be construed to have no value for purposes of establishing the value of 
EPCOR. 
 
13. Applicable Laws and Regulations.   
 
EPCOR is responsible to adhere to all applicable Federal and State laws, municipal 
ordinances, and the rules and regulations of all authorities having jurisdiction over 
EPCOR’s activities in the rights-of-way, including – but not limited to – storm water 
regulations (MS4), US Army Corps of Engineers permitting, Americans with Disabilities 
Act, and appropriate traffic control measures. 
 
14. Conflict of Interest.

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This Franchise shall be subject to cancellation pursuant to the provisions of A.R.S. §38-
511 in the event of a conflict of interest. 
 
15. Notices.   
 
All notices given pursuant to the terms of this Franchise will be in writing and will further 
be deemed to have been duly given: (i) upon personal delivery (including confirmed 
facsimile or electronic delivery such as Email); (ii) three business days after deposit in the 
United States mail, registered or certified with return receipt requested; or (iii) the next 
succeeding business day after deposit with a responsible overnight delivery service (similar 
to UPS and/or Federal Express) for next day delivery to the intended Party at the Party's 
last known address.  All notices required to be given to either party shall be sent or given 
as follows to the following persons: 
 
To City: 
 
 
10000 N. El Mirage Road 
 
 
 
 
El Mirage, Arizona, 85335 
 
 
 
 
Attn:  City Manager 
 
With a copy to: 
 
City of El Mirage, City Attorney 
 
 
 
 
 
 
10000 N. El Mirage Road 
 
 
 
 
El Mirage, Arizona 85335 
 
To EPCOR: 
 
 
EPCOR Water Arizona Inc., 
 
 
 
 
2355 West Pinnacle Peak Road, Suite 300 
 
 
 
 
Phoenix, AZ 85027 
 
 
 
 
Attn: Director, Central Division 
with a copy to: 
 
EPCOR USA Inc. 
Attn: Thomas Loquvam, General Counsel 
2355 W Pinnacle Peak Rd., Ste. 300  
Phoenix, AZ 85027  
Email: tloquvam@epcor.com 
 
16. Arizona State Law to Govern.   
 
The provisions of this Franchise shall be governed and construed in accordance with the 
laws of the State of Arizona.

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17. EPCOR's Representations and Warranties. 
 
A. Authority.  EPCOR represents and warrants that it has the power and authority to enter 
into this Franchise by and through the representative who has signed this Franchise on 
its behalf, and that it has the power and ability to do all the acts required of it by this 
Franchise. 
 
B. Misrepresentation.  EPCOR has not misrepresented or omitted material facts, has not 
accepted this Franchise with intent to act contrary to the provisions herein, and 
represents and warrants that, as long as it operates its utility system, it will be bound 
by the terms and conditions of this Franchise or any subsequently issued license. 
 
C. Attorneys.  EPCOR further acknowledges that it was represented throughout the 
negotiations of this Franchise by its own attorneys and had opportunity to consult with 
its own attorneys about its rights and obligations regarding this Franchise Agreement. 
 
18. Confidentiality. 
 
A. Protection of Confidential Information.  Subject to the Arizona Public Records Law 
(A.R.S. § 39-121 et seq.), to the fullest extent permitted by law, the City agrees to treat 
on a confidential basis any Confidential Information disclosed by EPCOR to the City.  
The City shall not use the Confidential Information for any purpose whatsoever other 
than in connection with its rights and obligations under this Franchise.  The City shall 
safeguard the Confidential Information using measures that are equal to the measures 
used to safeguard its own confidential information of comparable value, but in no event, 
shall the City exercise less than reasonable care. 
 
19. Severability.   
 
If any section, paragraph, clause, phrase or provision of the franchise shall be adjudged 
invalid or unconstitutional, the same shall not affect the validity of the Franchise as a whole 
or any part of the provisions hereof other than the part so adjudged to be invalid or 
unconstitutional.  
 
20. Miscellaneous. 
 
A. Filings. When not otherwise prescribed herein, all matters herein required to be filed 
with the City shall be filed with the office of the City Clerk.

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B. Force Majeure. 
 
i. EPCOR shall not be held in default under, or in noncompliance with, the provisions 
of this Franchise, nor suffer any enforcement or penalty relating to noncompliance 
or default (including termination, cancellation, or revocation of this Franchise) 
where such alleged noncompliance or default occurred or was caused by an act of 
God, an act or omission of governmental military or civilian authority, strike or 
lockout, riot, epidemic or quarantine, war, earthquake, fire, flood, tidal wave, 
unusually severe rain, wind, or snow storm, hurricane, tornado or other catastrophic 
act of nature, labor disputes, terrorist acts, governmental, administrative or judicial 
order or regulation or other circumstances that could not have been avoided through 
EPCOR's exercise of reasonable care, prudence and diligence.   
ii. Furthermore, the parties hereby agree that it is not the City's intention to subject 
EPCOR to penalties, fines, forfeitures, or revocation of the Franchise for immaterial 
breaches or violations of this Franchise Agreement.  “Immaterial” breaches or 
violations of this Agreement may include, but are not limited to instances or for 
matters:  (i) where a violation or a breach by EPCOR of the Franchise was a good 
faith error that resulted in minimal or no negative impact on the Citizens (i.e., a 
resident or inhabitant) within the Franchised Area; (ii) where strict performance 
with the terms of the Franchise would result in practical difficulties and hardship to 
EPCOR that outweigh the benefit to be derived by the City and/or Citizens. 
 
[SIGNATURES ON FOLLOWING PAGE]

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IN WITNESS WHEREOF, the parties hereto have executed this Franchise as of the ____day of 
________________, 2022. 
 
 
 
 
 
 
 
City of El Mirage 
an Arizona municipal corporation 
 
 
 
 
 
 
 
 
By: ________________________________ 
 
 
 
 
 
                   Alexis Hermosillo, Mayor 
 
Attest: 
 
___________________________________ 
Sharon Antes, City Clerk 
 
 
Approved as to Form: 
 
___________________________________  
Justin Pierce, City Attorney 
 
 
 
 
 
 
 
EPCOR Water Arizona Inc. 
                                      
 
 
 
an Arizona Corporation 
 
 
 
 
 
 
 
By: ___________________________________ 
 
 
 
 
 
 
 
 
STATE OF ARIZONA 
 
                                                      
County of__________ 
 
 
 
The foregoing instrument was acknowledged before me this ____ day of _______________, 2022, 
by ________________________________________ as the __________of the EPCOR Water 
Arizona Inc., an Arizona corporation, on behalf of the corporation. 
 
_______________________________________ 
Notary Public 
 
My Commission Expires: 
 
_____________________