Loading...
HomeMy WebLinkAboutresolution.council.102.20 RESOLUTION #102 (Series of 2020) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, WHICH AUTHORIZES THE CITY OF ASPEN TO ENTER INTO A CONTRACT WITH ASPEN SKIING COMPANY LLC FOR AN AMENDED AND RESTATED AGREEMENT FOR PURCHASE AND SALE OF WATER WHEREAS, the City operates an Integrated Water Supply System (IWSS) that uses various water rights, infrastructure and management techniques to best serve its customers; and WHEREAS, the City is party to a 40-year Agreement for Purchase and Sale of Water with Aspen Skiing Company LLC ("ASC"), dated March 23, 1981, by which the City provides treated water to ASC for snowmaking and some irrigation on Aspen Mountain; and WHEREAS, ASC provides significant recreational skiing and economic benefits to the City and surrounding areas, and contributes greatly to the outdoor recreation lifestyle that is important to the Aspen community; and WHEREAS, ASC requires water for snowmaking in order to provide the recreational experience its skiing customers require and expect; and WHEREAS, ASC and City staff have worked diligently to develop an amended and restated Agreement for Purchase and Sale of Water that will allow ASC to continue to purchase City water for snowmaking and irrigation while also recognizing and supporting the City's commitment to environmental values and to its mission to provide a legal, safe, and reliable water supply to all of its customers; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, That the City Council of the City of Aspen hereby authorizes and approves the Amended and Restated Agreement for Purchase of Water between the City of Aspen and Aspen Skiing Company LLC and, subject to final review and approval by the City Attorney, authorizes the City Manager to execute said agreement on behalf of the City of Aspen, in substantially the form provided to Council with this resolution. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on the 8th day of December, 2020. Torre, Mayor I, Nicole Henning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that Resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held December 8, 2020. Nicole Hennin , City Clerk DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-0D9E881E7D8B 11/16/20 FINAL AMENDED AND RESTATED AGREEMENT FOR PURCHASE AND SALE OF WATER THIS AGREEMENT is entered into this day of 2020,by and between the ASPEN SKIING COMPANY,LLC(formerly Aspen Skiing Corporation; hereinafter"ASC") and the CITY OF A49PEN(hereinafter"City")(together,the"Parties"). WITNESSETH: WHEREAS,by that certain Agreement dated March 3, 1978 and as amended on March 23, 1981,by and between the Parties("Original Agreement")certain terms and conditions were established for the provision of treated water by the City to ASC for snowmaking and other uses; and WHEREAS,the term of the Original Agreement ends on March 22,2021, and ASC will continue thereafter to require water for snowmaking and irrigation on certain real property used for the purpose of recreational skiing located within and without the City of Aspen, Colorado, and for other purposes; and WHEREAS,by Resolution No. 090-2019,the Board of County Commissioners of Pitkin County approved the 2018 Aspen Mountain Ski Area Amended and Restated SKI-REC Master Plan,Activity Envelope and Site Plan Review("Amended Master Plan"),which authorizes additional snowmaking coverage and installation of related infrastructure and snowmaking storage ponds;and WHERAS, ASC contemplates, subject to its obtaining any additional necessary governmental approvals and addressing possible contingencies,that it may further expand the current ski area, and that it will continue to provide snowmaking equipment at existing locations - 1 - 15627175_v5 DocuSign Envelope ID:A982E7F0-E75B-463A-BFDE-0D9E881 E71386 11/16/20 FINAL and will install additional snowmaking equipment for snowmaking on the existing and expanded ski area;and WHEREAS,the Parties anticipate that ASC's recreational skiing operations as conducted currently and as to be conducted in the future pursuant to all required government authorizations will provide environmentally-sensitive economic and recreational benefits to the City and its inhabitants;and WHEREAS,the Parties desire to amend and restate the Original Agreement as provided herein; NOW,THEREFORE, in consideration of the following terms and conditions the Parties agree as follows: 1. Subject to the terms and conditions of this Agreement,the City hereby agrees to deliver treated water to ASC at the Point of Delivery,at water delivery rates requested by ASC up to the maximum delivery rates for the time periods set forth below for the purposes of snowmaking and irrigation,and temporary detention for subsequent use for such purposes: (a) October 23 through November 23 (9:00 p.m.to 5:00 a.m.): 2,500 gallons per minute(gpm),and October 23 through November 23 (5:00 a.m.—9:00 p.m.): 1,900 gpm, (b) November 23 through December 20(9:00 p.m.to 5:00 a.m.): 2,500 gpm,and November 23 through December 20(5:00 a.m.—9:00 p.m.): 1,500 gpm, (c) December 21 through January 2: 1,500 gpm, (d) January 3 through April 16: 1,000 gpm, (e) April 17 through October 22:200 gpm, -2 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E7DBB 11/16/20 FINAL (f) The City agrees to use reasonable and practical efforts to operate its water distribution system in order to be able to provide water to ASC as set forth herein. The water delivery rates hereinabove described are the maximum rates at which the City is obligated to deliver water upon the request of ASC during the identified time periods. Notwithstanding the foregoing,the Parties may agree to a temporary modification of the delivery rates and schedule described above to accommodate special events hosted by ASC or for other operational reasons. In the event additional quantities of water are available in Aspen's water distribution system,and ASC has anticipated additional need therefor,ASC may request temporary increases in delivery rates and volumes,and the City may in its sole discretion,and subject to its agreements and policies regarding protection of the Colorado Water Conservation Board("CWCB")decreed instream flow rights,provide additional deliveries to ASC at such time and rates,and in such overall volumes,as the City deems appropriate. (g) The Parties recognize that climate change may affect the quantities of water required for snowmaking and irrigation and the times at which such water is required,as well as the timing and availability of supplies available to the City. The Parties may revise the above- described delivery schedule upon mutual agreement. In addition,as further information is obtained regarding climate change,the City may reasonably revise the delivery schedule if the City determines that the then-current delivery schedule does, or may reasonably be expected to, adversely affect the City's current or future ability to operate and maintain its public water system to provide potable and raw water supplies and fire protection and suppression to its customers at the times,rates and amounts the City deems appropriate(including storage of water for such operations), does or may reasonably be expected to adversely affect the City's current or future -3 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E713813 11/16/20 FINAL hydroelectric power generation operations, or the City reasonably determines that the then- existing delivery schedule is not or will not be consistent with the City's then-existing ordinances, rules,regulations and policies regarding protection of decreed instream flow rights,and other environmental considerations. Any such revised delivery schedule shall be signed by the Parties and attached as an addendum to this Agreement. ASC shall have no claims,rights,causes of action or other rights against the City as a result of the City's reasonable revisions to the delivery schedule under this paragraph 1(g). (h) ASC recognizes that the City is committed to protection of the CWCB's decreed instream flows on Castle Creek,Maroon Creek and the Roaring Fork River in the Aspen reach, and to that end,the City may totally or partially restrict delivery of water to ASC at the rates and volumes described herein at times when the decreed instream flow is not met in the creek from which the City is diverting its municipal water supplies(including supplies delivered to ASC pursuant to this Agreement),at or downstream of the City's point of diversion. ASC shall have no claims,rights,causes of action or other rights against the City as a result of such delivery restrictions. (i) In the event of an emergency,the City may totally or partially restrict delivery of water to ASC and ASC shall have no claims,rights,causes of action or other rights against the City as a result of such delivery restrictions. An"emergency"is any circumstance,not voluntarily created or caused by the City,nor reasonably foreseeable and preventable by the City,that prevents the City from providing,in whole or in part,water to ASC as provided for herein,and incudes,but is not limited to,drought,failure of infrastructure,loss of water rights,inadequate runoff,poor quality, judicial determinations and orders,or a determination by the City in its sole discretion that failure to restrict deliveries of water pursuant to this Agreement will imperil the health,safety or welfare of the -4 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881E7D8B 11/16/20 FINAL City's water customers or will be inconsistent with the City's agreements and policies regarding protection of CWCB's decreed instream flows. 0) If the City deems it necessary in order to maintain operational safety parameters and firefighting standards,the City may totally or partially reduce deliveries to ASC and ASC shall have no claims,rights,causes of action or other rights against the City as a result of such delivery restrictions. (k) The Parties will investigate the cost and feasibility of developing alternative sources of water supply for ASC, including, for example,storage,wells and pumping to storage ponds,that may be used when the City imposes curtailed or restricted deliveries,if the City revises the delivery schedule as provided in paragraph 1(g)above, or when ASC wishes water delivery at a greater rate than is provided for in this Agreement. Upon execution of this Agreement,the Parties will investigate the cost and feasibility of developing Aspen's Pump No.4 (a/k/a Little Nell Well and Aspen Well No.4),decreed for domestic and municipal uses in Case No.W-1156(Water Court,Water Division No. 5),as a source of water that may be available for delivery to ASC pursuant to this Agreement as an alternative source of water when treated water deliveries are reduced or curtailed,the delivery schedule is revised by the City pursuant to paragraph 1(g),or to provide temporary delivery increases pursuant to paragraph 1(f). (1) The Point of Delivery of treated water to ASC is shown on the map attached as Exhibit D. (m) Water delivered by the City to ASC pursuant to this Agreement shall be measured by the existing master water meter(the"Master Meter")which is of a type and size approved by the City. The Point of Delivery and Master Meter are shown on the design drawing attached -5 - DocuSign Envelope ID:A982E7Fo-E75B-463A-BFDE-OD9E881 E713813 11/16/20 FINAL Exhibit D. The Master Meter and any replacement Master Meter shall at all times remain property of the City and shall be maintained by the City at its cost. ASC shall provide the City with access to the Master Meter,which is located within a pump station owned and controlled by ASC. The Master Meter shall be the location at which the water provided by the City is measured for purposes of this Agreement. The City may verify the accuracy of the Master Meter at any time,either on its own initiative or at the reasonable request of ASC. The results of any test of the Master Meter shall be made available to ASC. If ASC has requested the test of the Master Meter,and the test results indicate that the accuracy of the Master Meter tests within 2% of the results of the most recent independent test, ASC shall bear the full cost of the test. The City shall bear the cost of the test if the City has undertaken the test on its own initiative,or if ASC has requested the test,and the test results indicate that the accuracy of the Master Meter is not within 2%of the results of the most recent independent test. No adjustment will be made to any previous invoices unless the Master Meter is found to be in error by more than 5%. Notwithstanding the forgoing,no adjustments shall be made to any invoices for time periods earlier than 30 days prior to discovery of the Master Meter error. If the Master Meter must be replaced, ASC shall reimburse to the City the cost of purchasing and installing a replacement Master Meter of a size and type approved by the City,and such replacement Master Meter shall be the Master Meter for purposes of this Agreement. (n) The City owns,and is solely responsible for, construction,operation,maintenance, repair and replacement of all infrastructure required to deliver water to the Point of Delivery at the water delivery rates provided for in this Agreement. ASC acknowledges that the City may deliver water to the Point of Delivery from any source or supply legally available to it,and may deliver -6- DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E713813 11/16/20 FINAL treated or untreated water,at its sole option. ASC owns, and is solely responsible for construction, operation,maintenance,repair and replacement of all infrastructure from and after the Point of Delivery needed for ASC to distribute and use the water provided pursuant to this Agreement, including but not limited to facilities for pumping and delivering water to elevations higher than the Point of Delivery as may be required for ASC's snowmaking uses. ASC will inspect,operate,maintain,repair and replace its infrastructure to meet the City's standards for such infrastructure,to prevent backflow/back-siphonage,waste,leakage and loss of water,and to ensure that the Master Meter is able to operate properly. (o) The City is the owner of all water rights and supplies delivered to ASC,and shall have the right,but not the obligation,to recapture and reuse all water delivered to ASC under this Agreement that is not consumptively used(for example, snowmelt water attributable to supplies provided for snowmaking, seepage from ponds in which water delivered for snowmaking or irrigation is detained,and irrigation return flows), and may appropriate and seek adjudication of water rights(including exchanges)and/or seek administrative approvals in order to recapture and reuse such water. Unless the Parties agree otherwise,any water right or administrative approval secured for such purposes shall be applied for,secured and owned by the City. ASC understands and supports the City's plans to recapture and reuse water delivered to ASC pursuant to this Agreement,recognizing that such reuse water will be an important part of the City's integrated water supply system that enables it to provide a safe,legal,reliable and sustainable water supply for its use and for the benefit of its customers, including ASC pursuant to this Agreement. The City will provide its Water Court application and/or any administrative application to appropriate, recapture and reuse the unconsumed water delivered to ASC under this agreement("Application") -7 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E7D8B 11/16/20 FINAL to ASC for review no later than ninety(90)days before it is filed in the Water Court or, in the case of an administrative application such as a substitute water supply plan,no later than ninety (90)days before it is submitted to the relevant administrative agency,in order to allow ASC to determine if its decreed water rights will be injured by the Application. If no objection is made by ASC within sixty(60)days of the date on which the Application is delivered to ASC in the manner provided in paragraph 12 ("Notice Period"),the City may file the Application in substantially the form provided to ASC. If ASC believes that the relief sought in the Application will cause injury to its decreed water rights,ASC will provide notice to the City within the Notice Period, identifying the specific provisions it believes will cause injury to its decreed water rights. The City and ASC shall cooperate in good faith to address and resolve the injury ASC has identified in a manner that will allow the City to proceed with its Application and will provide reasonable protection to ASC's decreed water rights. 2. As a requirement for continued and future use of water delivered pursuant to this Agreement,ASC agrees that: (a) ASC has installed,at its sole expense,a booster station and related facilities. Such infrastructure is required to achieve the necessary pressures to maintain adequate volume through the new backflow prevention device that was required to be installed by the City. (b) ASC shall obtain from the City a non-exclusive license,right of way or easement,in form acceptable to the City Attorney,allowing ASC to use up to 1,500 square-feet of real property presently owned in fee by the City, for the location,operation and maintenance of the infrastructure described in subparagraph(a)above. - 8 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E7D8B 11/16/20 FINAL (c) ASC shall hold the City harmless for any damage resulting from its use of the real property and facilities described in paragraph 2(b). (d) ASC shall comply with all governmental requirements concerning its operation as a recreational ski area and shall report to and consult with the City regarding the scope and applicability of any such requirements that may affect deliveries of water to ASC pursuant to this Agreement. (e) The Parties may determine in the future that certain infrastructure modifications are necessary or appropriate to implement this Agreement and may agree to such modifications and grant additional access rights as necessary upon mutually acceptable terms without amendment to this Agreement. Any such agreed-upon infrastructure modifications may be agreed upon at the staff level provided that the amount involved is less than the amount required to be approved by City Council pursuant to Section 4.08.040 of the Aspen Municipal Code,or any future amendment, revision or restatement thereof,and the terms and conditions of such modifications shall be memorialized in a signed, dated writing attached as an addendum to this Agreement. (f) No later than March 23,2022,the Parties will evaluate the Easement Agreement dated March 3, 1978,between Aspen Skiing Corporation and the City of Aspen, attached hereto as Exhibit A, to determine if any amendments are reasonably required,and, if so,will enter into an amended or replacement Easement Agreement to provide to the City appropriate easements to access, operate,maintain,repair and replace the pipelines,tank and related infrastructure identified in Exhibit A. -9 - DocuSign Envelope ID:A982E7F0-E75B-463A-BFDE-0D9E881 E7D8B 11/16/20 FINAL 3. The term of this Agreement shall be for a period of ten(10)years from March 23, 2021. This Agreement shall be subject to renewal for an additional five (5)years upon mutual agreement of the Parties not less than twelve months from the expiration date of this Agreement. 4. ASC shall pay for water delivered through March 22, 2021 in accordance with the rate calculation methodology set forth in the Original Agreement. ASC shall pay for water delivered after March 22,2021 at the initial rate of$6.05 per thousand gallons plus the amount of the City's applicable 2021 rate increase for Billing Area 1 (the"Water Rates"). The rate of$6.05 per thousand gallons represents an average effective rate for 2020 calculated using current demand,fire,and variable billing data of all customers within Billing Area 1. The City may increase or decrease its water rates to water customers in Billing Area 1 or change the basis or methodology for calculation of such rates,and any resulting rate increase or decrease shall be applied to ASC's Water Rates. ASC's Water Rates shall automatically increase or decrease by the average percentage increase or decrease charged by the City to customers in Billing Area 1,and such new Water Rates will be effective at the same time that any rate increase or decrease or change in rate calculation is effective as to the City's customers in said Billing Area. ASC shall receive notice of proposed rate changes in the manner that public notice of rate changes and rate reviews is provided for in the City of Aspen Municipal Code("Code"). Water rate adjustments for particular Billing Areas(as defined in the Code)that do not include ASC and that are made by the City to reflect unique circumstances of such other Billing Areas will not trigger a rate adjustment of ASC's Water Rates. - 10- DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881E7D8B 11/16/20 FINAL 5. As additional consideration for the delivery of water as herein contemplated,ASC shall: (a) Continue to abide by the Stipulation of September 1, 1980 between the Parties and the Board of County Commissioners of the County of Pitkin. Said Stipulation is attached hereto as Exhibit B and its terms incorporated by this reference. (b) Continue to lease to the City,on an as available basis,the Stapleton Brothers Ditch water right,with its diversion,transmission and pumping facilities,upon the terms and conditions of the existing lease attached hereto as Exhibit C and incorporated by this reference. 6. This Agreement shall not be construed as relieving ASC from any and all obligations to comply with any City of Aspen ordinances now in effect or hereafter adopted. 7. Except as otherwise provided herein,this Agreement,any of its provisions, and the terms of the Agreement may be modified only by the adoption of a writing signed by each party hereto or their respective successors in interest. 8. It is expressly agreed that this Agreement will not provide any basis for ASC to oppose any water court application, substitute water supply application,or other water rights application filed by the City and will not be used in any manner whatsoever by ASC to object to the exercise,use,transfer,or conveyance by the City of any water rights or supplies in which it now or may hereafter have an interest;provided, however,that ASC reserves the right to protect the supply of water available to any water right it may now own or hereafter acquire and nothing in this Agreement shall be construed as precluding ASC from participating in future water court or administrative proceedings as ASC deems necessary to protect its own decreed water rights from injury,provided,that if the City and ASC reach agreement on an Application or - 11 - DocuSlgn Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E7D8B 11/16/20 FINAL Applications by the City to appropriate,recapture and reuse the unconsumed water delivered to ASC under this Agreement, as provided in paragraph Lo,ASC will not oppose such Application(s)in the Water Court or any applicable administrative proceeding, or any applications for finding of reasonable diligence or to make absolute the water right(s) decreed upon the Application,and further provided that ASC will not oppose other water court applications filed by the City except to protect any rights in water,real property and supplies of water available to water rights that ASC now owns or may hereafter acquire. 9. ASC shall not petition to the Public Utilities Commission nor cooperate with any group seeking to establish regulated public utility jurisdiction for the provision of utility services by the City. In the event regulated public utility status is applied to the provision of utility service by the City,this Agreement may be terminated by the City. 10. Neither the City nor ASC shall be held liable for any failure to perform hereunder due to drought,acts of God,war, strikes,pandemic,or any other natural or manmade occurrences that are not subject to the control of the Parties. 11. This Agreement shall not affect ASC's right to make application for water services from the City for uses other than those provided pursuant to this Agreement snowmaking,under City of Aspen ordinances which are now in effect or are hereafter adopted. 12. All notices required to be given hereunder will be in writing and will be deemed given upon hand delivery or delivery by a recognized courier service,or, if mailed,three business days following deposit in the United States Mail,certified mail,return receipt requested, postage prepaid and properly addressed to the party to whom directed at the following - 12 - DocuSign Envelope ID:A982E7F0-E75B-463A-BFDE-0D9E881 E713813 11/16/20 FINAL address and contact person,or to such other person or address that may be provided by notice pursuant to this paragraph: To: ASC: Aspen Mountain Manager Aspen Skiing Company, LLC P.O. Box 1248 Aspen,CO 81612 With copy to: General Counsel,Aspen Skiing Company, LLC, P.O. Box 1248,Aspen, CO 81612 &Holland& Hart LLP,600 East Main St.,Ste. 104,Aspen, CO 81611 To: City of Aspen: Director of Utilities City of Aspen 130 S. Galena Street Aspen CO 81611 With copy to: City Attorney, City of Aspen, 130 S.Galena Street,Aspen CO 81611 13. The Original Agreement dated March 3, 1978,as amended on March 23, 1981, is superseded and replaced in its entirety by this Amended and Restated Agreement. 14. This Agreement shall be binding upon the Parties,their successors and assigns, and is entered into in the governmental capacity of the City. The Parties have executed this Agreement as of the day and year first above written. (Signatures on following page.) - 13 - DocuSign Envelope ID:A982E7FO-E75B-463A-BFDE-OD9E881 E713813 11/16/20 FINAL ASPEN SKIING COMPANY, LLC,a Colorado limited liability company By ATTEST: � � Secretary CITY OF ASPEN DocugWned by: By G.0,61 ATTEST: C City Clerk - 14 - DocuSign Envelope ID:A982E7F0-E75B-463A-BFDE-OD9E887 E7D8B 11/16/20 FINAL STATE OF COLORADO ) ss. COUNTY OF PITKIN ) 44, TIA foregomi ins rument was acknowledged before me this a day of hw,4� 2020,by ai - of the Aspen Skiing Company,LLC. Witness my hand and official sT2b My commission expires: /2022 - - '; " ROSIN V*IrrE Notary Public NORX STATE OF NOTARY 10#2006401 4" Mr comm(�gorl .mat 26.Mn - 15 - DocuSign Envelope ID:A982E7F0-E75B-463A-BFDE-0D9E881 E7D8B 11/16/20 FINAL STATE OF COLORADO ): ss. COUNTY OF PITKIN ) Md�a, The foregoing instrument was acknowledged before me this of 2020,by S ara ©j- as and N t Cole, �hn j I L q as City Clerk of the City of Aspen. Witness my hand and official seal. My commission expires: �x 5 TARA L. NELSON NOTARY PUBLIC STATE OF COLORADO Notary Public NOTARY ID#120014030017 My Commission Expi es Sepimrhar 25,20L21 '.'OV..M114\APYIMIM{IA - 16 -