Exhibit A - Amended and Restated Water Transportation Agreement

City of Chandler — Regular Meeting (2021-08-26)

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Resolution 5486
Page 3

Exhibit “A”

Amended and Restated Water Transportation Agreement

FINAL 032321

AMENDED AND RESTATED
WATER TRANSPORTATION AGREEMENT
BETWEEN
SALT RIVER VALLEY WATER USERS’ ASSOCIATION
AND

CITY OF CHANDLER

SECTION
1

2
3
4
5
6
7
8
9

10
4
12
43
14
15
16
17
18
19
20
21
22
23
24
25
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TABLE OF CONTENTS

SECTION TITLE
PARTIES

RECITALS

AGREEMENT

DEFINITIONS

SCOPE OF SERVICE

TERM

RATES, FEES, AND CHARGES

BILLING AND PAYMENT

WATER ACCOUNTING
APPOINTMENT/DUTIES OF AUTHORIZED REPRESENTATIVES
WATER QUALITY

TRANSPORTATION LOSSES

PRIORITY OF SERVICE

RIGHT TO CONTRACT OR SUBCONTRACT
DISTRIBUTION

INTERRUPTIONS OR CURTAILMENTS IN DELIVERY
FLOW MEASUREMENT

ACCESS TO PREMISES AND FACILITIES
FUTURE FACILITIES

NOTICE OF WATER DELIVERIES
EFFECTIVE DATE

GENERAL LIABILITY

AUDIT

UNCONTROLLABLE FORCES

NOTICES

WAIVER

HEADINGS

PAGE

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36
EXHIBIT A
EXHIBIT B
EXHIBIT C
EXHIBIT C-1

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RECLAMATION REFORM ACT

RESOLUTION OF DISPUTES

ACTION PENDING RESOLUTION OF DISPUTES
CONTRACT REOPENER

GOVERNING LAW

PERMITS

NO THIRD PARTY BENEFICIARIES

ENTIRE AGREEMENT

TERMINATION OF PRIOR WATER TRANSPORTATION AGREEMENT
POINTS OF DELIVERY

POINTS OF RECEIPT

WATER TRANSPORTATION PRIORITY

EXISTING ASSOCIATION WATER DELIVERY CONTRACTS AND
EXISTING DECREES

412
413
13
13
13
14
44
14
14

AMENDED AND RESTATED WATER TRANSPORTATION AGREEMENT BETWEEN

SALT RIVER VALLEY WATER USERS’ ASSOCIATION AND CITY OF CHANDLER

1. PARTIES:

The Parties to this Amended and Restated Water Transportation Agreement (Agreement) made and
entered into as of this day of ,20__, are the CITY OF CHANDLER, an Arizona
municipal corporation (City) and SALT RIVER VALLEY WATER USERS' ASSOCIATION, an Arizona
corporation (Association).

2. RECITALS:

This Agreement is made with regard to the following:

2.2

2.3

2.5

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The Colorado River Basin Project Act of 1968 (82 Stat. 885) provides, among other things,
that for the purposes of furnishing irrigation water and municipal and industrial water supplies
to water deficient areas in Arizona and Western New Mexico through direct diversion or
exchange of water, control of floods, conservation, development of fish and wildlife resources,
enhancement of recreation opportunities and for other purposes, the Secretary of Interior for
the United States of America (Secretary of Interior) shall construct, operate and maintain the
Central Arizona Project (CAP).

Shareholders of Association are owners of land within the Salt River Reservoir District, having
valid appropriative rights to waters of the Salt and Verde Rivers. Association is responsible
for delivery to said lands of waters developed, controlled or stored by it for the benefit of such
lands. Association is the agent of the Salt River Project Agricultural Improvement and Power
District (District), a political subdivision of the State of Arizona, in the operation of the water
delivery system of the Salt River Project, a federal reclamation project, pursuant to an
agreement dated March 22, 1937, as amended by agreements dated February 28, 1944, and
September 12, 1949, and is also the agent of the United States of America (USA) in the
operation of said federal reclamation project pursuant to contract dated September 6, 1917.
Association, in distributing water developed by Salt River Project works and facilities, is
governed by the decree in Hurley v. Abbott, filed March 1, 1910, and all supplemental decrees
thereto, all commonly referred to as the "Kent Decree"; the Articles of Incorporation and By-
laws and rules and regulations of Association; contracts now in effect and hereafter executed
between the Association, the District and the USA; rules and regulations promulgated by the
Secretary of Interior, pursuant to the provisions of an Act of Congress, approved June 17,
1902 (32 stat. 388), and acts amendatory thereof and supplementary hereto, all of which are
commonly known and referred to as Federal Reclamation Law; and by applicable laws of the
State of Arizona.

City, in distributing water within its water service area, is governed by, among other things,
applicable laws, ordinances, regulations and orders.

Association operates and maintains the water delivery system on behalf of and for the primary
benefit of its shareholders, who hold rights to water developed by the Salt River Project, and
to whom Association is obligated to deliver such water.

City has valid rights to the City Water to be transported, has existing contracts to transport
such water through the CAP and the Interconnection Facility and has the right pursuant to an

onl

2.6

2.7

2.8

2.9

existing contract to subcontract to third parties any part or all of its share of capacity in such
interconnection Facility.

City is in need of a link between the interconnection Facility and its facilities; therefore, City
desires to transport City Water through the Association Water Delivery System for use by City
and/or its subcontractors, and has the authority to enter into this Agreement for transportation
of such water.

Association does not as a rule make its water delivery system available to all water users
potentially served by it and does not operate for profit. However, as an accommodation to City
and for the incidental benefit to Association shareholders, Association will transport City Water
for City and its subcontractors as an incident to its primary function; provided that the
transportation of such water shall not in any way disrupt or interfere with the operation of the
Association Water Delivery System on behalf of Association shareholders and pursuant to
existing decrees and existing contracts; and provided further that this Agreement will not affect
the responsibilities of Association and City with respect to waters developed, controlled or
stored by Association and delivered to City pursuant to rights of Association shareholders and
existing decrees and existing contracts. (see Exhibit C-1)

As Association limits the use of the Association Water Delivery System to the transportation
and delivery of water to its shareholders and those entities with specific entitlements to such
delivery service, to the exclusion of the general public, this Agreement is necessary for
Association to transport City Water for City and its subcontractors.

On September 10, 19914, City and Association entered into the Water Transportation
Agreement, which only allowed for water transportation in Association canals. The purpose of
this Agreement is to create one agreement that allows for water transportation service in
canals, laterals, and drain ditches, and other revisions related to such service expansion.

3. AGREEMENT:

In consideration of the premises and mutual covenants and agreements herein set forth, the Parties
hereto agree as follows:

4. DEFINITIONS:

As used in this Agreement the following terms, when capitalized, have the meanings indicated:

4.2

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Annual Index: The number calculated by dividing the Association Acreage Assessment for the
current calendar year (commencing with 1992) by the Association Acreage Assessment for
the previous calendar year. The Annual Index shall be determined in January of each year
commencing in 1992. The Annual Index shall be calculated to four (4) decimals and rounded
to three (3). Rounding shall be done by dropping the fourth (4th) decimal when it is less than
five (5) or by increasing the third (3rd) decimal by one (1) when the fourth (4th) decimal is five
(5) or greater.

Association Acreage Assessment: The fee charged against Association assessed land to pay
the cost of construction, improvement, enlargement, betterment, repairs, operation and
maintenance of the irrigation and other works of Association, or of those under its
management, operation and maintenance.

4.3

4.5

46
AT

4.8

4.10

4.11

4.12

Association Water Delivery System: Association's canal, lateral and drain ditch system,
including canal, lateral, and drain ditch gates and measuring devices.

Authorized Representative(s): Those representatives of the Parties appointed to administer
the provisions of this Agreement pursuant to Section 10.1.

City Water:

a) City's share of the water resulting from City's funding of CAP Plan 6 modifications to
Roosevelt Dam and reservoir.

b) City's share of any water resulting from City's funding of acquisition of a water supply
alternative to that which was expected to have been provided by the now canceled
Cliff Dam feature of CAP Plan 6.

c) Water discharged for City into the Association Water Delivery System from the
Interconnection Facility.

d) Any other water as agreed to by the Authorized Representatives.
Effective Date: The date on which this Agreement becomes effective pursuant to Section 21.

Evacuated Water: Water released from the Association Water Delivery System:

a) As a result of excess storm runoff and under emergency conditions.
b) In the event of the discovery of contaminated water in the Association Water Delivery
System.

Interconnection Facility: The facility located adjacent to the Granite Reef Diversion Dam which
interconnects the CAP canal with the Association Water Delivery System and the Sait River
Bed.

Point(s) of Delivery: The points designated in Exhibit A, hereto, at which City Water is diverted
from the Association Water Delivery System for delivery to City or its subcontractors. Points
of Delivery may be added or deleted upon mutual agreement of the Authorized
Representatives. Association shall revise Exhibit A accordingly.

Point(s) of Receipt: The points designated in Exhibit B, hereto, where City Water is diverted
into the Association Water Delivery System for transportation to City Points of Delivery. Points
of Receipt may be added or deleted upon mutual agreement of the Authorized
Representatives. Association shall revise Exhibit B accordingly.

Transportation Losses: The amount of water lost through seepage, evaporation or other
causes while being transported within the Association Water Delivery System from the Point
of Receipt to the Point of Delivery. Transportation Losses shail not include Evacuated Water.

Water Accounting: The general determination of the quantity of City Water transported by
Association hereunder.

5. SCOPE OF SERVICE:

This Agreement is limited to transportation of City Water in the Association Water Delivery System
from the Point of Receipt to the Point of Delivery.

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6. TERM:

This Agreement shall become effective on the date provided in Section 21 and shall remain in effect
through June 30, 2041 unless otherwise terminated in accordance with the provisions of this
Agreement.

7. .RATES, FEES, AND CHARGES:

7.1

7.2

7.3

7.5

7.7

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For City Water transported in Association canals, Association shall bill City and City shall pay
Association $39.60 for each acre foot (AF) of City Water or fractional AF received at the Points
of Receipt whether or not City accepted or used such City Water. Beginning in calendar year
2027 and every five (5) years thereafter, Association may adjust such fee.

For City Water transported in Association laterals and drain ditches there shall be an additional
fee of $10.55 per acre-foot for such transportation. Beginning in calendar year 2027 and every
five (5) years thereafter, Association may adjust such fee.

Association shall also bill City and City shall pay Association an annual administration fee of
$3,645.49 which shall cover both the first Point of Delivery and first Point of Receipt listed on
Exhibits A and B respectively, and $655.11 for each additional Point of Receipt or Point of
Delivery, whether separate or in common with that of another contractor or subcontractor.
Commencing January 1, 2022, and in each January thereafter, the fees shall be adjusted by
the Annual Index. Such fees shall be billed when service is commenced, and in each January
thereafter, and paid in accordance with Section 8. The fees shall be prorated for those partial
years of service resulting from initiation or permanent termination of service at Points of
Receipt or Points of Delivery.

For purposes of Section 7.3, "adjusted by the Annual Index" means that the annual
administration fee for the previous calendar year is multiplied by the Annual Index. The rate
and annual administration fee shall be calculated to three (3) decimals and rounded to two
(2). Rounding shall be done by dropping the third (3rd) decimal when it is less than five (5) or
by increasing the second (2nd) decimal by one (1) when the third (3rd) decimal is five (5) or
greater.

Association shall consider the Interconnection Facility and Granite Reef Dam as one Point of
Receipt when determining the rates and fees which shall be billed to City.

If Association discontinues the Acreage Assessment or if the Parties determine the
purpose/components of it have drastically changed, the most recent two (2) consecutive
October values of the Consumer Price Index shall be substituted for the Association Acreage
Assessment in the Annual Index to adjust the rates and fees under this Agreement during its
remaining term absent superseding provisions pursuant to Sections 7.9 and 31.

Beginning in calendar year 2027 and thereafter, Association may change the rate or rate
structure provided in Section 7.3 no more frequently than five year intervals, based on
changed circumstances beyond the control of Association and which have increased the cost
of providing the service hereunder beyond those increases in costs reflected by the Annual
index.

if Association proposes to adjust the fee pursuant to Section 7.1, Section 7.2, or Section TT:

7.8.1 Association must provide City with written notice of the fee or new rate or rate
structure, and documentation to substantiate the changed circumstances and the
increased cost by January 31 of the year preceding the year in which the fee or new
rate or rate structure becomes effective.

7.8.2 If City is not willing to pay the fee or new rate/rate structure, City may terminate this
Agreement by giving written notice to Association before the fee or new rate or rate
structure becomes effective.

7.8.3 If City gives notice pursuant to Section 7.8.2, this Agreement shall remain in effect for
a period of three (3) years from the date of the City’s notice, unless otherwise agreed
by the Parties. During this period, City shall pay the new fee or new rate as provided
in Section 7.1, Section 7.2, or Section 7.7, respectively.

If, as a result of the services provided to City pursuant to this Agreement, Association becomes
liable to a governmental authority other than District for any tax, tariff, duty, toll, fee, impost,
charge or other exaction, or any increase thereof, pursuant to Section 8, Association shail bill
City and City shall pay Association the amount for which Association is liable.

8. BILLING AND PAYMENT:

8.1

8.2

8.3

8.4

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Bills for services provided to City shall be submitted by Association to City on or before the
twenty-fifth (25th) day of each month (or if such day is not a business day, on the next
succeeding business day) immediately following the month during which City has incurred
charges for such services. Such bills may include adjustments or corrections to bills previously
submitted by Association to City.

Payment by City to Association shall be made in good funds on or before the thirtieth (30th)
day following the date on which the bill was postmarked or if such day is not a business day,
on the next succeeding business day. Bills which are not paid by this date shall be delinquent
and thereafter accrue an interest charge at the prime rate of interest as established by the
Bank of America on the last business day of the month following the month for which the bill
was submitted, plus 2% per annum, prorated by days of the unpaid principal, computed daily
until payment is received. Any payment received shall first be applied to any interest charges
owed, and then to any bills owed for service rendered.

In the event any portion of any bill is disputed, the disputed amount shall be paid under protest
when due and shall be accompanied by a written statement indicating the basis for the protest.
If the protest is found to be valid, City shall be refunded any overpayment plus interest,
accrued at the rate set forth in Section 8.2, prorated by days from the date payment was
credited to City to the date the refund check is mailed.

In the event any delinquent amount is not paid by City within thirty (30) days after receipt by
City of written notice by Association to City of the delinquency and the remedies available to
Association under this Agreement if the delinquent amount is not paid, Association shall have
the right, without liability of any kind, to refuse to transport City Water so long as the said
amount remains unpaid and may terminate this Agreement. Nothing herein shall limit the
rights of Association to use any other available legal remedy to effect collection of said
amounts.

9. WATER ACCOUNTING:

9.1

9.2

9.3

Association will provide daily Water Accounting of City Water received for City at the Points
of Receipt. Such Water Accounting shall be retained by Association for at least three (3) years
and be made available for City's inspection upon written request.

City shall provide a monthly report of the total amounts of water received each day during the
month as measured at each Point of Delivery in accordance with operating procedures
prepared by Association. Such report shall be submitted to Association by the sixth (6th)
business day following the month end, pursuant to such operating procedures.

Association shall prepare a monthly Water Accounting report based on the daily Water
Accounting provided under Section 9.1. It shail also include the daily water deliveries as
reported by City pursuant to Section 9.2. Such Water Accounting report may be combined
with other existing Association reports to City and shall include City Water delivered to each
Point of Delivery, Transportation Losses, and Evacuated Water during that month.

10. APPOINTMENT/DUTIES OF AUTHORIZED REPRESENTATIVES:

10.1

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Association and City shall each appoint an Authorized Representative and an alternate to
administer Sections 10.1.1 through 10.1.10. The alternate shall act only in the absence of the
Authorized Representative. All decisions and agreements of the Authorized Representatives
shall be documented by a writing signed by both Authorized Representatives. Subject to each
Party’s internal approval and authorization process, the Authorized Representatives:

10.1.1. Shall review the operating procedures as developed by Association for implementing
the provisions herein.

10.1.2 May add or delete Points of Delivery pursuant to Section 4.9 or Points of Receipt
pursuant to Section 4.10.

10.1.3 May agree to transportation in the Association Water Delivery System of City Water
specified in Section 4.5d and shall establish any water quality or other limitations on
the transportation of such water. Priority for transportation of such water is "Fourth",
in accordance with Exhibit C.

10.1.4 May change the proportioning of City Water to City's multiple Points of Delivery
pursuant to Section 15.2 hereof.

10.1.5 Shall approve City's flow measurement systems, test procedures and adjustment
frequency therefor, and the communication interfaces required pursuant to Section
147 or waive or reduce the requirements to install such flow measurement systems
and communication interfaces pursuant to Section 17.

40.1.6 Shall approve the manner of access pursuant to Section 18.
10.1.7. Shall arrange for the return of water by the owing Party pursuant to Section 23.2.

10.1.8 May agree to impair the transportation of City Water under this Agreement pursuant
to Exhibit C-1.

10.1.9 Shall review and agree to all changes or improvements to the Association Water
Delivery System to accommodate its use by City pursuant to Section 15.3,

10.2

10.3

10.4

10.1.10 May agree on how to administer, implement, or effectuate certain sections of this
Agreement as necessary. Such documented understandings may pertain to
operational, accounting, and financial arrangements of this Agreement.

If the Authorized Representatives disagree as to any action to be taken or decision to be
made, or as to the need for taking any action or making any decision, or as to whether any
matter is within the scope of the Authorized Representatives’ responsibilities hereunder, the
question or questions at issue may be referred by either Party to arbitration pursuant to
Section 29.

Each Party shall notify the other Party in writing within thirty (30) days after execution of this
Agreement of the designation of its Authorized Representative and alternate and shall
promptly notify the other Party of any subsequent changes in such designation.

The Authorized Representatives shall have no authority to modify, amend or supplement this
Agreement, other than as expressly provided in this Section 10.

411. WATER QUALITY:

114.1

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Association neither guarantees nor warrants the quality of water transported through the
Association Water Delivery System to City pursuant to this Agreement, and City assumes all
responsibility for purifying or otherwise treating City Water received at City's Points of Delivery
to meet applicable water quality standards established by federal, state or local authorities.
Nothing in this Agreement shall be construed so as to require that Association receive or
transport water from any source when such receipt or transportation is likely to result in a
violation of then existing federal, state or local laws or regulations regarding water quality.

Except for Salt and Verde River water that is not stored underground, City shall indemnify
Association against all losses to third parties resulting from water quality degradation due to
commingling of City Water in the Association Water Delivery System, and shail defend
Association against all claims for such losses.

If Association coincidentally introduces water into the Association Water Delivery System
through the Interconnection Facility, or other causes contribute to the losses of third parties,
City will indemnify and defend only for those losses to third parties attributable to commingling
of City Water in the Association Water Delivery System.

Association shall cooperate fully with City in the defense of all claims of third parties for losses
under this Section 14 and shall provide City with all information, expert witnesses and records
necessary for City to defend against such claims.

City's obligation to indemnify under this Section 11 shall encompass only:

11.5.1. The payment of losses to third parties that have been determined by mutual
agreement of City and Association, arbitration or a court to have resulted from water
quality degradation due to commingling of City Water in the Association Water
Delivery System.

11.5.2 All costs of defending against claims by third parties for such losses and all costs
incurred by Association in cooperating with City under Section 11.4 in the defense of
such claims.

12. TRANSPORTATION LOSSES:

12.1

12.2

For City Water transported in canals, City shall be assessed Transportation Losses at the rate
of 0.08 percent per AF per mile between the Point of Receipt and the Point of Delivery. Using
the water balance of supply and delivery, a procedure similar to the loss calculation used in
standard reporting to the Arizona Department of Water Resources and the United States
Bureau of Reclamation, Association shall review and adjust such Transportation Loss rate
annually in April based on annual average Association Water Delivery System losses during
the preceding five (5) years. Such adjusted rate shall remain in effect until next adjusted.

Until otherwise determined by Association, for City Water transported in a lateral or drain ditch,
City shall not be assessed additional Transportation Losses; however, Association reserves
the right at any time to assess additional losses to City based on Association’s water loss
experience in the lateral(s) or drain ditch(es) being used to transport City Water. Prior to
assessing additional Transportation Losses pursuant to this Section 12.2, Association shall
provide City written notice and evidence and/or calculation supporting the assessed rate of
additional Transportation losses.

13. PRIORITY OF SERVICE:

13.1

13.2

13.3

City Water may be transported under this Agreement only to the extent that such
transportation does not impair nor prejudice the transportation and delivery of water to
Association shareholders or pursuant to existing decrees and existing contracts between
Association and City or between Association and any third party. (see Exhibit C-1)

Association shall transport water, as among all contractors for such service from Association,
according to the capacity of the Association Water Delivery System as determined by
Association, the priority set forth in Exhibit C hereto, and the date provided in Section 2.9 as
such date is applicable in determining water transportation priorities.

The Parties agree to work together and make all reasonable efforts in any settlement of an
Indian tribe's water rights claims to acquire federal funding to expand Association Water
Delivery System capacity, should such capacity be inadequate to satisfy the water
transportation needs of either Association, City, the Indian tribe, or a third party as a result of
such settlement; provided that a failure to acquire such funding shall not preclude Association
from entering into the Indian settlement agreement.

14. RIGHT TO CONTRACT OR SUBCONTRACT:

414.1

14.2

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Subject to Exhibit C, Association retains the right to contract directly with other entities desiring
transportation of water in the Association Water Delivery System.

City may subcontract services provided to it by Association under this Agreement, provided
that City shall cause any such subcontract to be subject to the terms and provisions of this
Agreement the same as if such services were being provided directly to City, unless otherwise
agreed in writing by Association. City shall be responsible for and pay Association the rates,
fees and charges set forth in Section 7 to provide transportation service to City’s
subcontractors the same as if such services were provided directly to City. City shail not
subcontract transportation services provided by this Agreement for an overall charge greater
than that charged City by Association for the same service, except to the extent necessary to
recover any additional expenses incurred by City as a result of the subcontract.

15. DISTRIBUTION:

15.1

15.2

15.3

15.4

Association's obligations and responsibilities to City under this Agreement shall commence at
the Point of Receipt and shall terminate at the Point of Delivery. City shall be responsible and
assume full liability for the further distribution of City Water received at the Point of Delivery,
including, but not fimited to, all operation and maintenance costs for delivery to City's end
users.

If City has multiple Points of Delivery on the Association Water Delivery System, City Water
will be transported to each Point of Delivery in proportion to total water orders for those Points
of Delivery. If City factually documents the proportions of on-Project and off-Project deliveries
at each of its Points of Delivery, then upon mutual agreement of the Authorized
Representatives, Association will transport City Water according to those proportions.

City may request the Association to make changes or improvements to the Association Water
Delivery System and related structures. City shall be responsible for all costs associated with
any changes or improvements made pursuant to such City request if the change or
improvement is made for the sole purpose of accommodating City’s use of the Association
Water Delivery System and related structures for the transportation of City Water; otherwise,
the cost of such change or improvement shall be divided between the Parties as mutually
agreed upon.

City shall not make any change or improvements to the Association Water Delivery System
and related structures or facilities of Association without the written approval of Association.
Upon termination or expiration of this Agreement, City shall restore to a condition satisfactory
to Association, the Association Water Delivery System and related structures and facilities of
Association to which City had made changes. if City fails to accomplish such restoration,
Association shall do so and the expense thereof shall be charged to and paid by City.

16. INTERRUPTIONS OR CURTAILMENTS IN DELIVERY:

16.1

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Transportation of City Water shall be in accordance with City's requests as set forth in Section
20 of this Agreement, and shall be subject to:

16.1.1. Interruptions and curtailments in the capability of Association to transport City Water
due to emergencies, dry up of Association Water Delivery System facility, operational
constraints and necessary maintenance and repairs of the Association Water Delivery
System, all as determined solely by Association.

16.1.2 Interruptions, evacuations and curtailments because of excessive storm runoff
entering the Association Water Delivery System, as determined solely by Association,
or because Association determines that significant degradation of water quality in the
Association Water Delivery System likely to result in substantial liability is occurring
or may occur as a result of introduction of City Water, contamination or contaminated
water in the Association Water Delivery System.

16.1.3 No obligation on the part of Association to replace any portion of City Water evacuated
from the Association Water Delivery System.

16.1.4 Availability of City Water at the Points of Receipt, as determined by Association.

16.2

Transportation service interruptions, curtailments, and evacuations addressed in Section
16.1.1 and 16.1.2 shall be allocated in accordance with Exhibit C.

17. FLOW MEASUREMENT:

174

17.2

17.3

17.4

City shall, at its sole expense and with the approval of the Authorized Representatives,
construct, install and maintain in accordance with manufacturers’ specifications for the specific
application, a flow measurement system and communications interface at each Point of
Receipt and each Point of Delivery compatible with Association telemetry requirements. The
Authorized Representatives may waive or reduce the requirements of this Section 17.1 for
any Point of Receipt or Point of Delivery for which they deem the requirements excessive with
respect to the quantity of water to be taken at that Point of Receipt or Point of Delivery.

City shall maintain the accuracy of its flow measurement systems (flow measurement device
and detection device) as close to zero error as practical, but in no event shall error exceed
plus or minus five percent (5%) of actual flow except when the flow being measured is to a
City water treatment plant (WTP) operating at thirty percent (30%) or less of maximum
operating capacity. In such circumstances, the accumulated volume delivered to a WTP
during the periods of exception in a calendar year shall not exceed six percent (6%) of the
total volume delivered to that WTP during that calendar year. City shall prepare and regularly
implement testing and recalibration procedures for the flow measurement systems, which
procedures must be approved by the Authorized Representatives. At least once every six
months, unless otherwise agreed by the Authorized Representatives, City shall recalibrate its
flow-measuring system as close to zero error as practical, but in no event shall error exceed
plus or minus five percent (5%) of actual flow except as provided above in this Section. City
shall notify Association of when such recalibration is planned so that Association may observe
the procedure. Association may at reasonable times, at its sole expense and after reasonable
notice to City, test or have tested the flow-measuring system to determine its accuracy.
Association may discontinue service to City hereunder during any period of noncompliance
with this Section unless City agrees to accept Association's billing and water accounting
pursuant to Section 17.3.

In the event that water accounting records or any routine or special test of the flow
measurement system discloses an annual volume, or a flow measurement error, that exceeds
the limits provided in Section 17.2, all bills and water accounting affected by such limits having
been exceeded may be adjusted by Association based on the best available data as
determined by Association. However, adjustments arising from other than annual volume
limits shall not encompass more than the elapsed time since the last preceding test.

City bears responsibility and cost for any flow-measurement system and communications
interface required for all future Points of Receipt and Points of Delivery.

18. ACCESS TO PREMISES AND FACILITIES:

City grants to Association, its employees and agents the right of access to the premises identified on
Exhibits A and B, at reasonable times and after reasonable notice from Association, for such purposes
as installing, connecting, reading, testing, repairing, adjusting, disconnecting, removing or inspecting
meters, measuring devices, communications equipment, data devices and other apparatus and
equipment pertinent to the provision of or accounting for services under this Agreement. Right of
access under this Section shail be in a manner approved by the Authorized Representatives.

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19. FUTURE FACILITIES:

Except as otherwise provided herein, City bears responsibility and cost for any facility needed at a
future Point of Receipt or Point of Delivery to effect service under this Agreement.

20, NOTICE OF WATER DELIVERIES:

City shall provide adequate notice to Association of City's water orders and any subsequent order
changes, in accordance with operating procedures established by Association. Operating procedures
established by Association shall provide that, in the event of a pending Association Water Delivery
System curtailment, Association shall give City as much notice as reasonably practicable of the
pending curtailment and give City the maximum flexibility reasonably attainable to adjust or change
the source, as between water identified in Sections 4.5a and 4.5b, of its pro rata share of the total
amount of this water that has been ordered by all cities. Association shall schedule, transport and
account for City Water. Transportation of City Water shall be subject to operational and maintenance
constraints common to all parties served by the Association Water Delivery System. The amount of
City Water requested by City, less Transportation Losses, shall be delivered by Association to the
Point of Delivery, subject to the provisions of Section 15.2 and 16. Association shall schedule and
monitor the transportation of City Water so as not to in any manner whatsoever interfere with the
operation and maintenance of the Association Water Delivery System.

21. EFFECTIVE DATE:

This Agreement shall be effective as of January 1, 2022 upon execution by both Parties.

22. GENERAL LIABILITY:

Each Party shall assume liability for its own negligence and shall indemnify the other against any
damages the non-negligent Party incurs as a result of the negligent Party's action or inaction.

23, AUDIT:

23.1. Upon reasonable written notice, either Party at its expense shall have the right, at all
reasonable times, to review and audit the books, records and documents of the other Party
directly pertaining to the billings and Water Accounting data required to administer this
Agreement. Any such audit may be conducted by an employee of or independent accountant
designated by the auditing Party. The Party being audited agrees to fully cooperate with any
such audit. This right to audit shall extend for a period of three (3) years following the date of
each payment under this Agreement. The Parties agree to retain all necessary records and
documentation during this audit period. The foregoing shall not be construed to permit either
Party to conduct a general audit of the other Party's records. Information obtained by either
Party's representatives in examining the other Party's applicable records to verify such billings
and Water Accounting data shall not be disclosed to third parties without prior written consent
of the audited Party, or unless in response to compulsory judicial or regulatory process or
state law and after giving the other Party written notice as much in advance as possible.

23.2 The audited Party's Authorized Representative shall be notified in writing of any exception
taken as a result of an audit and shail respond to such notification within thirty (30) days. Upon
resolution of any exception, 1) as to payment of any monies due, the owing Party shail directly
remit the amount of any exception to the other Party within thirty (30) days, with interest
calculated at the rate set forth in Section 8.2. Interest shall be computed from the date of the

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original billing to the date of payment by the Party owing as a result of the Audit, 2) as to any
water due, the Authorized Representatives shall arrange for the owing Party to return the
amount owed as soon as practicable.

24, UNCONTROLLABLE FORCES:

Neither Party shall be considered to be in default in the performance of any of its obligations hereunder
(other than obligations of City to make payment for service hereunder) when a failure of performance
shall be due to uncontrollable forces. The term “uncontrollable forces" shall mean any cause beyond
the control of the Party unable to perform such obligation, including, but not limited to, failure of or
threat of failure of facilities, flood, earthquake, storm, fire, lightning and other natural catastrophes,
epidemic, war, riot, civil disturbance or disobedience, strike, labor dispute, labor or material shortage,
sabotage, government priorities and 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, which by exercise of due diligence such Party could not reasonably have been expected to
avoid and which by exercise of due diligence it shall be unable to overcome. Nothing contained herein
shall be construed to require either Party to settle any strike or labor dispute in which it is involved.

25. NOTICES:

Any notice, demand or request provided for in this Agreement shall be in writing and delivered in
person, or sent by registered or certified mail, postage prepaid, to:

Salt River Valley Water Users’ Association

c/o Secretary

P. O. Box 52025

Phoenix, AZ 85072-2025

Reference: Amended and Restated Water Transportation Agreement
(With a copy to Association's Authorized Representative.)

City of Chandler

Attention: City Manager

175 S. Arizona Ave.

Chandler, AZ 85244

Reference: Amended and Restated Water Transportation Agreement
(With a copy to City's Authorized Representative.)

26. WAIVER:

The waiver by either Party of any breach of any term, covenant or condition herein contained shall not
be deemed a waiver of any other term, covenant or condition, or any subsequent breach of the same
or any other term, covenant or condition herein contained.

27. HEADINGS:
Title and paragraph headings herein are for reference only and are not part of this Agreement.
28, RECLAMATION REFORM ACT:

In no event shall Association's performance of obligations established herein subject Association or
its shareholders to provisions of the Reclamation Reform Act of 1982 (RRA), as amended, and
regulations attendant thereto, to which Association would not otherwise have been subjected. Further,
in the event a change of legislation, future federal agency determination or other administrative or
judicial action subjects or purports to subject Association to the RRA as a result of Association's

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performance of obligations established herein, Association shall be relieved of any further obligations
hereunder, and this Agreement shall be voidable at Association's discretion.

29, RESOLUTION OF DISPUTES:

29.1

29.2

City and Association may submit a dispute under this Agreement to a non-binding arbitrator if
both Parties agree to arbitration in writing. Within 30 days of obtaining written consent to
arbitrate, both Parties shall name one arbitrator. The two arbitrators selected by the Parties
shall select a third arbitrator as soon as practicable. Within 30 days from the selection of the
third arbitrator, the arbitrators shall hold a hearing. Within 30 days from the conclusion of the
hearing, the arbitrators shall render a decision on the dispute.

Any Party that is dissatisfied with the results of non-binding arbitration may pursue any other
legal or equitable remedy not expressly provided for in this Section 29 and available to resolve
the dispute.

30. ACTION PENDING RESOLUTION OF DISPUTES:

Pending the resolution of a dispute pursuant to Section 29, the Parties shall proceed, to the extent
legally permissible, in a manner consistent with this Agreement, and shall make payments required in
accordance with the applicable provisions of this Agreement. Amounts paid by a Party pursuant to this
Section 30 during the pendency of such dispute shall be subject to refund and adjustment upon a final
resolution of any dispute involving an amount due. Upon such final resolution, the owed amounts shall
be remitted in accordance with the remittance procedures/arrangements contained in Section 8.

31. CONTRACT REOPENER:

31.1

31.2

31.3

31.4

31.5

Either Party may request that this Agreement be modified because of extraordinary
circumstances that were not reasonably foreseeable by the Parties, were outside of the control
of the Parties and have resulted in a substantial change in the benefits or obligations under
the Agreement of the Party requesting modification.

This Section 31 is intended to apply to events such as changes in legislative authority,
enactment of new environmental requirements, destruction of Association Water Delivery
System and related facilities, changes in water rights and changes in technology.

If a Party requests that this Agreement be modified pursuant to this Section 31, the Parties
agree to negotiate in good faith to reach a reasonable and equitable modification of this
Agreement. If the Parties cannot agree, the Party requesting the modification may submit the
matter to arbitration in accordance with Section 29.

The Party requesting the modification has the burden of showing that the event causing the
request for modification meets the requirements of Sections 31.1 and 31.2 and that the
modification requested is reasonable and equitable to both Parties.

This Section 31 does not preclude the Parties from modifying this Agreement by mutual
consent for reasons that do not meet the requirements of Sections 31.1 and 31.2.

32. GOVERNING LAW:

This Agreement is made under, and shall be governed by, the laws of the State of Arizona.

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33. PERMITS:

City shall be responsible for obtaining any permits required to discharge City Water into the
Association Water Delivery System; except that if any permits are required to discharge City Water
from Association-owned or operated facilities into the Association Water Delivery System, Association
and City shall be jointly responsible for obtaining the permits. Denial of any necessary permit shall not
result in liability of either Party to the other.

34, NO THIRD PARTY BENEFICIARIES:

This Agreement is solely for the benefit of the Parties, and does not create nor shall it be construed to
create rights in any third party. No third party may enforce the terms and conditions of this Agreement.

35. ENTIRE AGREEMENT:

The terms, covenants and conditions of this Agreement constitute the entire Agreement between the
Parties and no understandings or obligations not herein expressly set forth shall be binding upon them.
This Agreement may not be modified or amended in any manner unless in writing and signed by the
Parties. .

36. TERMINATION OF PRIOR WATER TRANSPORTATION AGREEMENT:

The Water Transportation Agreement that was entered into by the Parties as provided in Section 2.9,
and any supplements or amendments thereto, shall terminate on the Effective Date of this Agreement.

[Remainder of this page intentionally blank]

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IN WITNESS WHEREOF, this Agreement is executed by the Parties hereto.

Approved as to form and within the power and
authority granted under the laws of the Territory of
Arizona to the Sait River Valley Water Users’
Association.

"FER =

Attest:

City Clerk

Approved as to form and within the power and
authority granted under the laws of the State of
Arizona to the City of Chandler.

Vie
City Attofhey

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SALT i VALLEY WATER USERS’ ASSOCIATION

Title: Hew — At — Klee

CITY OF CHANDLER

By:

Title:

AMENDED AND RESTATED
WATER TRANSPORTATION AGREEMENT
BETWEEN
SALT RIVER VALLEY WATER USERS’ ASSOCIATION
AND
CITY OF CHANDLER

EXHIBIT A
POINTS OF DELIVERY FOR CITY OF CHANDLER AND ITS SUBCONTRACTORS

A. Water Treatment Plants:

Name Capacity Location SRP Coordinates
Chandler 60 MGD 1475 E. Pecos Road 05.2E-17.0N

B. Underground Water Storage Facilities:

Name Location SRP Coordinates
Granite Reef Underground Storage Project South Canal at the GRUSP turnout 32.4E-07.1N
(GRUSP)

New River-Agua Fria River Underground Tail end of the Grand Canal near 01.00E-10.0N
Storage Project (NAUSP) 107" Ave & Bethany Home Rd

c. Other Points of Delivery:

Name Location/Identifier Lateral(s)-Gate(s) SRP Account No.
RWCD Pumping Plant! South Canal (32.5E-7.5N) N/A NIA

1 For water accounting purposes, the point of measurement for the Roosevelt Water Conservation Disterict (RWCD) shall be the weir at "RWCD at
the Head" located at 32.5E-7.5N. The instrumentation and telemetry devices are owned and operated by SRP. SRP collects and maintains the
water flow data ai the weir. City shall report to SRP the amount of City Water delivered to the RWCD Pumping Plant.