HomeMy WebLinkAboutAgenda Report - March 21, 1990 (56). O U N C I L- C O M M U N I T I O N
TO: THE CITY COUNCIL
FROM: THE CITY MANAGER'S OFFICE
COUNCIL MEETING DATE: MARCH 21, 1990
SUBJECT: REQUIRED EXECUTION OF PROJECT AGREEMENT NO. 3 IN ACCORDANCE WITH
ATTACHED RESOLUTION TO PERMIT PARTICIPATION IN CONSTRUCTION OF THE
CALIFORNIA -OREGON TRANSMISSION PROJECT.
RECOMMENDED ACTION: Approval and authorization of City Manger to execute: (i)
an execution copy of Project Agreement No. 3 that is prepared in the manner
provided for in TANC Resolution No. 90-18, a copy of which is attached hereto and
incorporated into this resolution by this reference; and (ii) such amendments and
supplements to Project Agreement No. 3 as either such officer determines with the
advice of counsel to be necessary or appropriate from time to time hereafter to
cure any ambiguity or eliminate superfluous provisions or to correct or supplement
any defective provision in Project Agreement No. 3.
BACKGROUND INFORMATION REGARDING THE CALIFORNIA -OREGON TRANSMISSION PROJECT AND
AGREEMENTNO. 3 TO PROCEED WITH CONSTRUM097`
i
• The California -Oregon Transmission Project or Third AC Intertie (Project) is
a proposed 500-kv AC transmission line from Southern Oregon to Central
California.
• Congress has named the California -Oregon Transmission Project "The Harold T.
(Bizz) Johnson California -Pacific Northwest Intertie Transmission Line."
The Transmission Agency of Northern California (TANC) and the Western Area
Power Administration (Western) were the original creators of the Project,
which was proposed in 1983.
During 1984, other California utilities requested large shares of the
Project.
The basic plan for the California -Oregon Transmission Project, which
includes nearly all utilities in California, has been approved by
Congress. (P.L. 98-360 and P.L 99-88)
TANC is the Project Manager and is responsible for the expeditious
completion of the Project.
TANC issued a $26.8 million financing to initiate design/analysis
pursuant to an initial Project Agreement in December 1985.
TANC refinanced that 526.8 million into an expanded financing amounting
to $60 million in May 1989 to cover all environmental costs and land
acquisition.
forward to rund construction and
TANC i s moi � nn orwa operation of the Project
pursuant to the Project Agreement No. 3, attached hereto.
CC/AGREE.3/TXTU.01D
Council Communicatic. Page 2 March 21, 1990
This transmission project is expected to have a service life far exceeding 50
years in duration.
• TANC financing pursuant to Project Agreement No. 3 covers construction and
refinancing the $60 million financed to date (used for design, environmental
and land acquisitions).
- The TANC financing will amount to $292 million with a 30 -year financing
period.
- Lodi's share in the TANC financing is 1.686% or approximately $377,000
per year.
• Participation percentages are not fixed until the participating
investor-owned utilities have obtained certificate of convenience and
necessity from the California Public Utility Commission.
• Lodi has indicated a need to double our participation should the opportunity
present itself; however, the possibility is remote.
- Our 11.4 megawatt participation will cover less than 4 years of load
growth for the City of Lodi.
• Expeditious completion (by 1993) of COTP construction will enable the Members
of TANC to begin to utilize new power markets and bulk power suppliers
presently not available to most of the TANC Members.
Henry J. Ride
Electric Utility Director
Attach.
CC/AGREE.3/TXTU.01D
RESOLUTION NO. 90-18
RESOLUTION OF THE
TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
APPROVING AND AUTHORIZING
ExECUT ION OF PROJECT AGREEMENT NO. 3
FOR THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
WHEREAS, the Transmission Agency of Northern California
(IANC), a joint exercise of powers agency established pursuant to
the laws of the State of California, has been actively involved in
the planning and development of the -Cali fornia-;Oregon.Transmi$s ion
Project (Project); and
WHEREAS, the Members of TANC desire to authorize TAMC to
undertake additional .responsibilities as a Participant in the
Project including, but not limited to, activities pertaining to
construction and operation of the Project; and
WHEREAS, the Members of IANC have developed a Project
Agreement No. 3 (Agreement) to set forth -the-Members' rights and
obligations with regard to the construction and operation of the
Project; and
WHEREAS, the Participation Percentages set forth in Appendix C
of the Agreement are based upon all of the Members of TANC
specified in that Appendix electing to sign the Agreement; and
WHEREAS, in completing the Agreement the Members have also
developed a methodology to share transmission services between
Midway and Tesla Substations;
NOW, THEREFORE, BE IT RESOLVED by the Commission of the
Transmission Agency of Northern California, as follows:
Section 1. The Agreement, in substantially the form presented
to this meeting and made a part hereof as though set forth in full
herein, is hereby approved. The Chairman, with the advice of TANC
General Counsel, is hereby authorized to execute and deliver the
Agreement in the form presented to this meeting with such changes,
insertions and omissions as may be approved by the Chairman, said
execution being conclusive evidence of such approval.
Section 2. The Chairman, the Vice Chairmen, each Assistant
Treasurer, and the Treasurer of the Agency, the Secretary and any
other proper officer of IANC, acting singly, and each of them,
hereby are authorized to execute and deliver any and all documents
and instruments and to do, or cause to be done, any and all acts
and things necessary or proper for carrying out the transactions
contemplated by the Agreement and this resolution.
Section 3. In the event that the governing body of a Member
listed in Appendix C of the Agreement-- fails -to- -adopt- a- resolution
in substantially 'the form of the. Suggested Resolution for.•.Member
Authorizing Execution of Project Agreement No. 3 (Member
Resolution) appended hereto before April 15, 1990, such Member
shall be considered to have elected to relinquish any right or
entitlement to further participate in the Project.
Section 4. On or before April 20, 1990, execution copies of
the Agreement shall be transmitted to each Member that adopted a
Member Resolution prior to April 15, 1990 (remaining Member). Such
execution copies shall contain no reference to any other Members
and shall establish the Participation -Percentage of each remaining
Member at the ratio between the remaining Member's Participation
Percentage set forth in Appendix C of the Agreement presented at
this meeting and the aggregate of the Participation Percentages of
all of the remaining Members set forth in that Appendix C,
expressed as a percentage; provided that the Participation
Percentage so established for any Member shall not exceed the
Member's Participation Percentage set forth in Appendix C of the
Agreement presented at this meeting by more than 5 percent without
the consent of the Member.
Section 5. The Members and TAMC agree to share the Tesla to
Midway transmission service provided under t;e Memorandum of
Understanding for the Project according to the amounts described
in Attachment 2 hereto provided that the Cities of Alameda,
Healdsburg, Lodi, Lompoc, Palo Alto, Rosevilie, and Ukiah, and the
Plumas--Sierra Rural Electric Cooperative shall, have a. collective
option to purchase 5 MW of such service by the assumption of the
rights and obligations from the collective rights and obligations,
allocated according to their participation percentages in M -S -R
Public Power Agency, of the Cities of Redding and Santa Clara and
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the Modesto Irrigation District, iprovidpAthat such option must be
exercised before Tesla -Midway service begins, and that service
provided under such option will be provided for the term of the -°
Tesla to Midway transmission service.
Section 6. This resolution shall take effect immediately upon a
its adoption.
PASSED AND ADOPTED this 21st day of February, 1990,, on a
motion by Mr. Hahn, seconded by Mr. Weisel.
a
RESOLUTION NO. 90-47
A RESOLUTION OF THE LODI CITE COUNCIL
APPROVING AND AUTHORIZING EXECUTION OF PROJECT AGREEMENT NO. 3
TO PERMIT PARTICIPATION IN CONSTRUCTION OF THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
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WHEREAS, the California -Oregon Transmission Project or Third AC
Intertie (Project) is a proposed -500-kv AC -transmission line from
Southern Oregon to Central California; and
WHEREAS, the Lodi City Council hereby approves the City's
participation in construction of the California -Oregon Transmission
Project;
NOW, THEi:EFORE, BE IT RESOLVED BY THE LODI CITY COUNCIL that the
City Manager is hereby authorized to execute Project Agreement No. 3;
and
BE IT FURTHER RESOLVED, that the City Manager is authorized to
execute such amendments and supplements to Project Agreement No. 3 as
determined to be necessary or appropriate from time to time.
Dated: March 21, 1990
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I hereby certify that Resolution No. 90-47 was passed and
adopted by the Lodi City Council in a regular meeting held March 21,
1990 by the following vote:
Ayes: Council Members - Hinchman, Olson, Pinkerton, Reid and
Snider (Mayor)
Noes: Council Members - None
Absent: Council Members - None
Alice M. Reim/the
City Clerk
90-47
RES9047/TXTA.02J
1
TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
P.O. Box 661030, Sacramento, CA 95866 (916) 924-11%
TO: Distribution List March 7, 1990
FROM: Maury Kruth aq,0,,
SUBJECT: BRIEFING MATERIALS FOR TANC PROJECT AGREEMENT NO. 3
Enclosed please find a package of informational material for
your use in presenting TAWC Project Agreement No. 3 to your
governing body. The material is unbound to allow you to use the
portions relevant to your individual needs. If you would like a
bound version, please call Steve McClary at 916/924-1534.
Distribution List:
K. DeDario
B. Duarte
E. Geddes
S. Lindley
J. Marcotte
J. McGuire
B. Pfile
F. Reid
E. Roman
M. Roper
G. Wahlers
K. Weisel
A Public I ntit\ �%ho.e Members Int lett♦(•:
dme(1.t. Bit y c, Gri(ile�. tie.tl<i.hurt. 1 wli. ; or"I'm , \itxi('>t(r Irrii;,tt;ur. DWri(t. Paler '.it(;.
Rcddin[:. Fo�e\ille. Via( tanx•nt(; .nlun,i( i[;, f L 11111,
lurlrxk Ir izatir;n Di"tn( t. t ki.ih
MEMORANDUM
TO: Distribution List March 7, 1990
FROM: Maury Kruth aq,0,,
SUBJECT: BRIEFING MATERIALS FOR TANC PROJECT AGREEMENT NO. 3
Enclosed please find a package of informational material for
your use in presenting TAWC Project Agreement No. 3 to your
governing body. The material is unbound to allow you to use the
portions relevant to your individual needs. If you would like a
bound version, please call Steve McClary at 916/924-1534.
Distribution List:
K. DeDario
B. Duarte
E. Geddes
S. Lindley
J. Marcotte
J. McGuire
B. Pfile
F. Reid
E. Roman
M. Roper
G. Wahlers
K. Weisel
A Public I ntit\ �%ho.e Members Int lett♦(•:
dme(1.t. Bit y c, Gri(ile�. tie.tl<i.hurt. 1 wli. ; or"I'm , \itxi('>t(r Irrii;,tt;ur. DWri(t. Paler '.it(;.
Rcddin[:. Fo�e\ille. Via( tanx•nt(; .nlun,i( i[;, f L 11111,
lurlrxk Ir izatir;n Di"tn( t. t ki.ih
"'INFING Boolt
• THE
"MUISHISSIAGENCY
'IF NORTEtERN
CALIFORNIA
1990 FINANCING
I. INTRODUCTION
• This Briefing Book has been prepared by the
Transmission Agency of Northern California (TAMC) to
provide the Members of IANC with key information on
the California -Oregon Transmission Project (COTP) and
the 1990 TAMC financing.
• The COTP will provide the public power member utilities
of TAMC with a new path to a diverse array of resources
in the Pacific Northwest. This is a major step in
safeguarding the independence of the TAMC Members and
their ability to provide reliable, low-cost power to
their ratepayer -owners.
• As COTP Project Manager, TAMC has provided the
leadership necessary to move ahead with a multi -
Participant project. To maintain progress toward
completion of the COTP, TAMC is proposing to start
construction in the summer of 1990, with energisation
in late 1992 or early 1993.
1
II. THE TRANSMISSION AGENCY OF NORTHERN CAI.IFORN
• The Transmission Agency of Northern California (TAMC)
is a California Joint Powers Agency that was formed in
1984 by fifteen publicly owned utilities and districts
that are the Members of TAMC.
• TANC was formed to assist the Members in developing,
acquiring, and financing electric transmission projects
that would assist the Members in providing economical
power to their ratepayers.
• Each Member appoints a Commissioner (and Alternates)
to the TAMC Commission, which governs TAMC.
K
Assuming 1,600 MW rating for the COTP and existing COTP
Participants.
3
EMBERS OF THE
TRANS14ISSION AGENCY OF NORTHERN
CALIFORNIA
f
AND PRESENT SHARES
THROUGH TAMC
IN THE COTP
MEMBER
PERCENTAGE
MGAWATTS
Alameda
1.713
11.59
Higgs
0.000
.0.00
Gridley
0.000
0.00
Healdsburg
0.357
2.42
Lodi
1.686
11.41
Lompoc
0.408
2.76
MID
19.200
129.92
Palo Alto
4.254
28.79
'
Plumas-Sierra
0.358
2.42
Redding
6.400
43.31
Roseville
1.455
9.85
Santa Clara
20.200
136.69
SMUD
30.600
207.06
TID
12.900
67.29
Ukiah
0.469
3217
100.000
676.67 MW
Assuming 1,600 MW rating for the COTP and existing COTP
Participants.
3
III, THE CALIFORNIA --OREGON TRANS!lISSION PROJECT
Congress has named the California -Oregon Transmission
Project "The Harold T. (Binz) Johnson California -
Pacific Northwest Intertie Transmission Line."
• The California -Oregon Transmission Project or Third AC
Intertie (Project) is a proposed 500 -kV AC transmiss?on
line from Southern Oregon to Central California.
The Transmission Agency of Northern California,(TANC)
and the Western Area Power Administration (Western)
were the original creators of the Project, which was
proposed in 1983.
- During 1984, other California utilities requested
large shares of the Project.
The basic plan for the California -Oregon
Transmission Project, which includes nearly all
utilities in California, has been approved by
Congress. (P.L. 98-360 and P.L. 99-88)
TAMC is the Project Manager and is responsible for
the expeditious completion of the Project.
- TANC is moving forward to complete the Project as
quickly as possible.
4
PARTICIPANTS
IN THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
PARTICIPANT
Transmission Agency
of Northern California
Southern Cities 2
Pacific Gas and
Electric Company
Southern California
Edison Company
San Diego Gas and
Electric Company
Western Area Power
Administration
50 MW Allottees 3
TOTAL
COST.
PERCENT SHARING
ENTITLEMENT MEGAWATTS PERCENTAGE
42.2916
676.7
45.1110
7.5497
120.7
8.0530
20.3918
326.3
21.7513
17.5370
280.6
18.7061
2.8549
45.7
3.0452
6.2500
100.0
0.0000
3.1250
50.0
3.3334
100.0000
1,600.0
100.0000
1 Assuming 1600 MW rating for the COTP.
2 Anaheim, Azusa, Banning, Colton, Riverside, and Vernon.
3 Carmichael Water District, E1 Dorado Hills Community
Services District, San Juan Suburban Water District,
Shasta Dam Area Public Utility District, Southern Sar.
Joaquin Valley Power Authority, and Trinity County Public
Utility District.
6
IV. HISTORY OF THE CALIFORNIA-OREGIN TRANSMISSION PROJECT
AND THE TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
• 1982 - The Members of what is now the Transmission
Agency of Northern California were trying to find
transmission alternatives to the Pacific Northwest.
Yet another try to build a new transmission line with
the Pacific Gas and Electric Company (PG&E) had failed.
1983 - The concept for the California -Oregon Trans-
mission Project was identified. The primary difference
between this and previous proposals was to, 'use the
upgrade concept for a Western Area Power Administration
(Western) 230 -kV double circuit line between Redding
and Tracy, as opposed to a new line in that area, to
minimize costs and environmental impacts.
1984 - Western obtained legislation (with strong TAMC
support) approving their participation in COTP. The
legislation (P.L. 98-360) also required that all
California utilities be given the opportunity to
participate. The investor-owned utilities (IOUs)
demanded 80 percent of COTP capacity, even though the
publics had created the Project. IANC was formed and
the Memorandum of Understanding (MOU) negotiated.
1985 - The MOU was approved by Congress in P.L. 99-88.
It provided for TANC to be the Project Manager and
divided up the.COTP. TANC retained the largest share
of line capacity (677 MW) in the COTP.
The COTP is Develoved
1985
f
• The Interim Cost Sharing Agreement was signed by all
Participants, including the IOUs. TAMC continued work
a
on COTP while difficult negotiations for the Project
Development Agreement (PDA) continued.
• In September 1985, the PDA was completed. The PDA
specified the duties of the Project Manager and
provided for funds for environmental, engineering, and
pre -construction work. The PDA gave the IOUs 20 months
to obtain California Public utilities Commission (CPUC)
approval after the Environmental Impact Statement/
Environmental Impact Report (EIS/EIR) was completed -
- no one thought this was a problem that would have to
be faced.
1986-1988
Environmental, engineering, and route selection work
was performed under TAMC direction. Extensive public
involvement took place as the route was defined.
Engineering design was performed by Sargent & Lundy
under TAMC direction.
In December 1985, Western successfully tested the
upgrade tower design with an actual 230 -kV Central
Valley Project tower.
• A massive EIS/EIR for the 340 -mile COTP was
successfully completed. The report was certified by
TANC in January 1988 and by Western in May 1988. The
environmental studies have not been challenged.
91
• Engineering, planning, and design work have been
successfully completed. The Plan of Service was
completed in Larch 1987, and tower and conductor design
recommendations were completed in November 1988.
IANC has met the COTP development schedule and budget
requirements as described in the PDA.
1989
• TANC proceeded with acquisition of right of way for the,
northern section of the COTP. By February 1990, TAMC
has obtained over 90 percent of the necessary right of
way.
• During 1989, TAMC and Western provided funds for
continued development and land acquisition while the
investor-owned utility Participants pursued regulatory
approval from the California Public Utility Commission.
• TANC successfully tested the tower design for the new
500 -kV line segments in February 1989.
An interim TAMC financing of $60 million was undertaken
in May 1989 to refinance the 1985 Revenue Anticipation
Notes and to provide the initial funds for
construction, land acquisition, and related activities.
• As of February 1990, TANC has rights of way and permits
for approximately 95 percent of the right of way
required for the northern segment of the Project.
9
Current Status
• TANC has carried out its duties as Project Manager,
with input from all interested parties, in a timely,
cost-effective manner.
• TANC and Western will proceed with construction,
starting in Spring 1990.
• The IOUs will refile applications for.Certificates of
Public Convenience and Necessity (CPCN) in April or May
1990 and hope to receive their CPC -Ns by the end of
1990.
• The IOUs' 20 -month time period established by the PDA
expired in December 1989.
• Congressional support has been maintained, including
support in the Pacific Northwest.
o IANC Project Agreement No. 3 was approved in February
1990. This agreement provides for completion of the
COTP by TAMC and Western, if necessary.
V. TAMC PROJECT AGREEMENT NO. 3
IANC Project Agreement No. 3 (PA3) provides for TAMC
to complete the California -Oregon Transmission Project
with the IANC Members committed to up to 1500 MW if
necessary. (Western receives 100 MW at no cost for the
rights of way.)
PA3 also provides minimum and maximum megawatt
obligations to each Member of TAMC (APPendix C to PA3)
and further specifies the marketing of excess capacity
on a layoff basis, if requested by the Members.
PA3 contains standard financing covenants and pledges.
IN addition, revenues from layoffs are also pledged.
e IANC Member approvals of PA3 are ongoing and should be
completed in early April 1990. Sixty-day ordinances
are not required.
01
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VI. THE ECONOMICS OF THE COTP
The COTP will allow the TAMC Members to reach new
markets with diverse resources and system peaks that
are seasonally different from California's peak load
periods. This transmission provides a path to the
outside world and can ensure competitive power
alternatives.
New transmission and new California markets can be
expected to stimulate development of generation
resources in the Northwest and Canada.
A variety of power transactions continue to be
available with the Pacific Northwest and other
utilities, including:
- Seasonal exchanges
- Firm power purchases and sales
- Emergency power
- Economy energy
The asking prices for these transactions are
reasonable. Bonneville Power Administration (BPA), for
example, is proposing rates well below typical PG&E
rates for similar transactions. Several TANC Members
have been making favorable transactions on their
existing (but very limited) Intertie rights.
Seasonal exchanges will remain attractive even when (or
if) the Northwest's firm energy surpluses become fully
committed.
Other extra -regional entities who are likely future
players include: BC Hydro, Montana Power, Basin
Electric, etc.
14
o Project construction cost is estimated at $405 million
for 1600 MW, excluding interest during construction and
associated financing costs. This compares very
favorably to the other alternatives available to
municipal utilities. g
ftpp
y
.l
o TAMC Member costs per kilowatt of line capacity should
be less than $3 per kW/month= the relative .debt service
risks for the Members ars very reasonable. A
transmission line" .such as COTP is a long-term- j
t
infrastructure investment, opening mziny alternatives
to potential buyers and sellers and it is also probably
a once in twenty or thirty years opportunity.
e The COTP is an attractive investment, especially if
higher pricing of transmission is implemented by PG&E.
SMUD's existing 200 MW Intertie entitlement is also
extended if the COTP is completed.
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VII. COTP QUESTIONS
In considering the final financing for the COTP, at least
ten tough questions have been raised by the TANG Members regarding
the COTP and in particular the status of negotiations and
agreements with PG&E. In this section, these questions are posed
along with answers that are believed to be the best available as
of March 1990. Negotiations are presently ongoing and it is quite
possible that the exact situation on certain agreements and
arrangements will change over time.
Question No. 1s "Will there he any power available to us from the
Pacific Northwest when the COTP is completed?"
Answers TAMC has been established to build the COTP (and perhaps
other future projects) but it is not involved in securing the power
purchases for the Members of TAMC. Nevertheless, TAMC has followed
developments in the Pacific Northwest power markets. At present,
the Bonneville Power Administration and others in the Northwest
estimate that BPA's firm energy surplus (but not capacity) will
have been fully utilized by 1993. What this means is that sales
of firm capacity and seasonal exchanges will continue to be
available, and in addition, Canadian utilities (such as BC Hydro)
and others in Wyoming and Montana are also likely to be in the
market for energy sales to California. In short, power will be
available but the arrangements and the utilities with whom
transactions occur are likely to change as the market conditions
change.
The Pacific Northwest was and will be a winter peaking
region, while California peaks in the summer. Therefore, the
fundamental reasons for the COTP to be a sound investment are
unchanged: by improving the transmission infrastructure between
the two regions, it will open new alternatives to buyers and
sellers in both California and the Pacific_Northwest.
17
Question No. 2: "Will PG&E connect the COTP to their system if
they are not a COTP Participant?"
Answer: The Congressionally -approved MCU provides for an
interconnected COTP and PG&E has stated its willingness to
interconnect with the COTP, and voted for Plans at the Management
Committee level, even if PG&E is not a Participant, subject to
agreements that are being negotiated at present. PG&E will receive
benefits from the COTP (such as improved transmission system
reliability) even if it does not participate in the COTP. TAMC
also believes there are remedies to obtain services and
interconnection, if such remedies should become necessary.
It should be noted that this situation is quite similar to
those experienced i)V public power entities in Northern and Central
California for new projects and that when these entities proceeded,
despite their difficulties, they were successful in ultimately
completing their projects and their final agreements with PG&E.
Question No. 3: "Won•t this Project be too expensive?*
Answer: No. While the COTe in total is estimated to cost $405
million for 1600 MW, the cost to each Member, assuming a long term
joint action agency financing, has been estimated to be quite
reasonable (under $3 per kilowatt month).
Question No. 4: "What if TAMC commits to pay for the Project and
it doesn't work for some reason?"
Answer: In the absolute worst case, the TANC Members through TANC
Project Agreement No. 3 will be committed to pay for their
respective shares of the annual debt service if the Project does
not work. The impact would vary for each Member depending upon its
share in IANC and the COTP. In general, it appears that the
18
resulting financial impact would not be unmanageable or lead to
noncompetitive rates.
TAMC (and its numerous utility partners) are firmly
convinced that the Project will in fact "work." 500 kV
transmission lines, such as the COTP, are a proven technology that
has been used throughout the U.S. since the 19601x. The existing
AC Interties are 500 kV transmission lines and the COTP has been
designed to operate in parallel with them.
Question No. 5% "Can PG&E stop the COTP?"
Answer: The TAMC Executive Committee is confident that the COTP
will be built with or without PG&E's participation. The benefits
of COTP construction, the strong support of Congress, and the
interests of all the Participants (including PG&E) support that
judgment.
Question No. 6: "W'ho will use any excess COTP capacity that might
be obtained through TAMC in this Project?"
Answer: The TAMC agreements have been structured to facilitate
the internal and external layoffs of any excess capacity that a
Member might have. Based on requests from the Members, the amount
of excess capacity does not seem likely to be large. TAMC has
explored the possibility of layoffs to other Participants such as
the Western Area Power Administration and certain of these layoffs
appear to be potentially attractive. On a real time basis, if
layoffs are not made, then unused capacity would be treated on the
same basis as the existing Intertie.
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Question No. 7: "How much will this Project cost?"
Answer: On a monthly basis, assuming a joint action agency
financing through TAMC, the COTP should cost less than' $3 per
kilowatt month. Transmission lines typically, have very .long
lifetimes -- over 50 years. The Project Participation Agreement
is a 50 -year agreement, which expires only upon agreement by all
the Participants. Therefore, after the TAMC debt is paid off
(,years), this cost would decrease to the operation and
intenanne cost (a small amount per kilowatt of line capacity).
VIII. THE PLAN FOR COMPLETING THE CALIFORNIA -OREGON
TRANSMISSION -:PROJECT`
The TAMC Executive Committee has recommended the following
actions by the TAMC Members:
• Approval of TANC Project Agreement No. 3 (which is in
substantially final form) to enable a TAMC financing
that would complete the COTP, without other
Participants such as PG&E, if necessary, and
• Expeditious completion (by 1993) of COTP construction
to enable the Members of TAMC to begin to utilize new
power markets and bulk power suppliers presently not
available to most of the TANC Members, and
• Continued negotiations with the other COTP
Participants, including PG&E, to bring the COTP to
completion consistent with the original MOO as has been
directed by the United States Congress, to the extent
possible.
To continue moving forward with COTP construction, the TANC
Commission has outlined the following strategy:
- Proceed with negotiation of a Project Participation
Agreement (PPA), to be executed by all or most of the
current Participants who want to sign the PPA.
- Proceed with COTP construction in 1990, with TANC
paying the IOUs' share of costs while the IOUs seek
final regulatory approvals.
- TANC will issue two types of financing - tax-exempt to
fund TANC's share, taxable to fund the IOUs' share
during 1990. The IOUs would refund the taxable
21
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financing, if they have received their CPCNs, or IANC
can undertaken an appropriate refinancing.
If other Participants drop out, the Federal Allottees.
the California Department of Water Resources, Western,
and IANC will step up for the unused capacity.
IX. FINANCING PLAN AND SCBEDULE
• Member final approvals of TAMC PA3 should be completed
in early April 1990.
• A tax-exempt bond issue for TANC's "base" COTP
entitlement of 677 MW would be completed in May 1990
(Approx. $290 million. 30 -year bonds).
• A commercial paper program would be undertaken
beginning June 1990 with the issues sized to match
TAN;;'s cash flow requirements (Approx. $100 million
through early 1991).
• Upon completion of the CPUC Certificate process for the
California IOUs, TAMC would either defease the
commercial paper (if the IOUs are in COTP) or undertake
subsequent, appropriate financings (PA3 enables these
without further Member approvals).
23
TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
P.O. Box 661030, Sacramento, CA 95866 (916)1924-1196
MEMORANDUM
TO: TAMC Members February 23, 1990
FROM: Joseph B. MarcoJ
Chairman 91(
SUBJECT: APPROVAL OF TANC PROJECT AGREEMENT NO. 3
I am pleased to report that on February 21, 1990, the
Commission of the. Transmission Agency of Northern California
(IANC) approved IANC Project Agreement No. 3, which will provide
for financing, construction, and operation of the California -
Oregon Transmission Project (.Project). In adopting TAMC Project
Agreement No. 3, the Commission also established a schedule for
the Members of TAMC to elect to proceed with the Project. The
schedule calls for each TAMC Member participating -in the Project
to approve Project Agreement No. 3 before April 15. 1990, as the
final election date to remain in the Project.
Enclosed you will find:
a suggested form of resolution for each City or
District to use in approving Project Agreement No. 3;
• a copy of the TAMC Resolution approving Project
Agreement No. 3; and
• Project Agreement No. 3 as approved by the Commission
of TAMC.
'', •\ Puhlit E ntih ��hn,t• 11t•rttht•n int i;n'.•
AI,)meda. Biggs. Gr Ht'a".d,hur14. t t•.Ir. ! txnlr:.t '.to.t:lt ,i r ;n ct at:•:n I I, It 1, t fain All,
Rvdding. f ct,t^.illt . NJ( ran:rnlrt Ntunu P-1 [ ti::t.
TTuriot i. {rrtti;a?nM Oi,trt t, l krah
0
TANC Members
February 23, 1990
Page 2
TANC staff are preparing briefing materials and will be
available to provide assistance as needed to present Project
Agreement No. 3 to your staff and governing board members. I
would like to emphasize the importance of moving forward with
your local approvals in a timely fashion as TAMC moves forward
with financing arrangements for the Project.
If you have any questions or comments regarding the process
for approving Project Agreement No. 3# please feel free to
contact Lloyd Harvego or Maury Kruth at (916) 924-1534 or Dennis
De Cuir (our General Counsel) at (916) 444-3900.
RESOLUTION NO. 90-18
RESOLUTION OF THE
TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
APPROVING AND AUTHORIZING
EXECUTION OF PROJECT AGREEKENT NO. 3
FOR THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
WHEREAS, the Transmission Agency of Northern California
(TAMC), a joint exercise of powers agency established pursuant to
the laws of the State of California, has been actively inv:2ved in
the planning and development of the California -Oregon Transmission
Project (Project); and
WHEREAS, the Members of TAMC desire to authorize TAMC to
undertake additional responsibilities as a Participant in the
Project including, but not limited to, activities pertaining to
construction and operation of the Project; and
WHEREAS, the Members of TAMC have developed a Project
Agreement No. 3 (Agreement) to set forth the Members' rights and
obligations with regard to the construction, and operation of the
Project; and
WHEREAS, the Participation Percentages set forth in Appendix C
of the Agreement are based upon all of the Members of TAMC
specified in that Appendix electing to sign the Agreement; and
WHEREAS, in completing the Agreement the Members have also
developed a methodology to share transmission services between
Midway and Tesla Substations;
NOW, THEREFORE, BE IT RESOLVED by the Commission of the
Transmission Agency of Northern California, as follows:
Section 1. The Agreement, in substantially the form presented
to this meeting and made a part hereof as though set forth in full
herein, is hereby approved. The Chairman, with the advice of TANC
General Counsel, is hereby authorized to execute and deliver the
Agreement in the form presented to this meeting with such changes,
insertions and omissions as may be approved by the Chairman, said
execution being conclusive evidence of such approval.
Section 2. The Chairman, the Vice Chairmen, each Assistant
Treasurer, and the Treasurer of the Agency, the Secretary and any
other proper officer of TAMC, acting singly, and each of them,
hereby are authorized to execute and deliver any and all documents
and instruments and to do, or cause to be done, any and all acts
and things necessary or proper for carrying out the transactions
contemplated by the Agreement and this resolution.
Section 3. In the event that the governing body of a Member
listed in Appendix C of the Agreement fails to adopt a resolution
in substantially the form of the Suggested Resolution for Member
Authorizing Execution of Project Agreement No. 3 .(Member
Resolution) appended hereto before April 15, 1990, such Member
shall be considered to have elected to relinquish any right or
entitlement to further participate in the Project.
Section 4. On or before April 20, 1990, execution copies of
the Agreement shall be transmitted to each Member that adopted a
Member Resolution prior to April 15, 1990 (remaining Member). Such
execution copies shall contain no reference to any other Members
and shall establish the Participation Percentage of each remaining
Member at the ratio between the remaining Member's Participation
Percentage set forth in Appendix C of the Agreement presented at
this meeting and the aggregate of the Participation Percentages of
all of the remaining Members set forth in that Appendix C,
expressed as a percentage; provided that the Participation
Percentage so established for any Member shall not exceed the
Member's Participation Percentage set forth in Appendix C of the
Agreement presented at this meeting by more than 5 percent without
the consent of the Member.
Section 5. The Members and TAMC agree to share the Tesla to
Midway transmission service provided under the Memorandum of
Understanding for the Project according to the amounts described
in Attachment 2 hereto provided that the Cities of Alameda,
Healdsburg, Lodi, Lompoc, Palo Alto, Roseville, and Ukiah, and the
i
Plumas-Sierra Rural Electric Cooperative shall have, a -collective
option to purchase 5 MW of such service by the assumption of the
rights and obligations from the collective rights and obligations,
allocated according to their participation percentages in M -S -R
Public Power Agency, of the Cities of Redding andSantaClara and
the Modesto Irrigation District# 12royi ed,that such option must be
exercised before Tesia-Midway service begins, and that service
provided under such.option will be provided for the term of the
Tesla to Midway transmission service.
Section 6. This resolution shall take effect immediately upon
its adoption.
PASSED AND ADOPTED this 21st day of February, 1990, on a
motion by Mr. Hahn, seconded by Mr. Weisel.
City of Alameda
City of Higgs
City of Gridley
City of Healdsburg
City of Lodi
City of Lompoc
Modesto Irrigation District
City of Palo Alto
Plumas-Sierra Rural
Electric Cooperative
City of Redding
City of Roseville
Sacramento Municipal
Utility District
City of Santa Clara
Turlock Irrigation District
City of Ukiah
AYES
x
x
x
X
NOES ABSTAIN ABSENT
X
E3
x
SUGGESTED RESOLUTION FOR MEMBER AUTHORIZING
EXECUTION OF PROJECT AGREEMENT NO. 3
WHEREAS, the Members of TAMC have developed a Project
Agreement No. 3 ("Agreement") to set forth the Members' rights and
obligations with regard to the construction and operation of the
California -Oregon Transmission Project; and
WHEREAS, on February 21, 1990, by (Resolution No. 90-18, the
TANG Commission approved that Agreement and directed that 'the,
execution copies of the Agreement refer only to TANC Members that
adopt resolutions authorizing execution before April 15, 1990, and
further directed that such execution copies contained appropriate
adjustment of Member Participation Percentages in the event some
Members fail to adopt such authorizing resolutions;
BE IT RESOLVED, that each of and is
authorized and directed to execute: (i) an execution copy of
Project Agreement No. 3 that is prepared in the manner provided for
in TANC Resolution No. 90-18, a copy of which is attached hereto
and incorporated into this resolution by this references and (ii)
such amendments and supplements to Project Agreement No. 3 as
either such officer determines with the advice of counsel to be
necessary or appropriate from time to time hereafter to cure any
ambiguity or eliminate superfluous provisions or to correct or
supplement any defective provision in Project Agreement No. 3.
Attachment 2
South of Tesla Shares
South
of Tesla
TAMC Allocation
Member (MW)
Alameda
2.57
Sealdsburg
0.54
Lodi
2.53
Lompoc
0.61
MID
103.80
Palo Alto
6.38
Plumas-Sierra
0.54
Redding
32.10
Roseville
2.18
SMUD
45.90
Santa Clara
82.80
TID
19.35
Ukiah
0.70
TOTAL 300.00
TRAXSXI88ION AGENCY OF
NORTHERN CALIFORNIA
PROJECT AGREEMENT NO. 3
FOR THE
CALIFORNIA-OREGON TRANSMI88ION
PROJECT
2/23/90
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TRANSMISSION AGENCY OF NORTHERN.CALIFORNIA
PROJECT AGREEMENT NO. 3
FOR THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
AMONG
THE TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
THE CITY OF ALAMEDA
THE CITY OF HEALDSBURG
THE CITY OF LODI
THE CITY OF LOMPOC
THE MODESTO IRRIGATION DISTRICT
THE CITY OF PALO ALTO
THE PLUMAS-SIERRA RURAL ELECTRIC COOPERATIVE
THE CITY OF REDDING
THE CITY OF ROSEVILLE
THE SACRAMENTO MUNICIPAL UTILITY DISTRICT
THE CITY OF SANTA CLARA
THE TURLOCK IRRIGATION DISTRICT
THE CITY OF UKIAH
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SECTION
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TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
PROJECT AGREEMENT NO..3
FOR THE
CALIFORNIA -OREGON TRANSMISSION PROJECT
TABLE OF CONTENTS
Preamble . . . . . . . . . . ... . . . •
Recitals •
Definitions . . . . . . . . . . . . . . .
Project Participation and Authorization .
Duties and Responsibilities of TAMC During
Phase II and Phase III . . . . . . . . . . .
obligations of Members During Phase II and
Phase III . . . . . . . . . . . . . . . . . •
Term, Termination, and Amendments . . . . . .
Default . . . . . . . . . . . . . . . .
Use of Transfer Capability . . . . . . . . .
Scheduling . . . . . . . . . . . . . . . . .
Insurance and Indemnification . . . . . . . .
Compliance with Other Instruments . . . .
Liability of TANC Officers . . . . . . . . .
Notice and Computation of Time . . . .
Applicable Law . . . . . . . . . . . . . . .
Severability . . . . . . . . . . . . . . .
Members' Right to Withdraw . . . . . . .
Assignment of Agreement . . . . . . . . . . .
Members' Obligations Several . . . . . . . .
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kAGE
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18 Trustee as a Third Party Beneficiary
. . . . 41
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19 Appendices . . . . . . . . . . . . .
. . . . 42
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20 Waiver
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21 Captions
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22 Billing and Payment . . . . . . . . .
. . . . 42
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23 Distribution of Assets . . . . . . .
. . . . 44
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24 Counterparts . . . . . . . . . . . .
. . . . 44
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25 Signatures . . . . . . .
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Memorandum of Understanding . . . . . . . .
. . APPENDIX A
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Memorandum of Understanding Annex . . . . .
. . APPENDIX B
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Participation Percentages . . . . . . . . .
. . APPENDIX C
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Prescheduling of Transmission Use
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and Curtailment Notification
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Procedures . . . . . . . . . . . .
. . APPENDIX D
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Billing Addresses of the Parties . . . . .
. . APPENDIX E
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PREAMBLE
This Project Agreement No. 3 is made and entered into as of
March 1, 1990, by and among the Transmission Agency of Northern
California, hereinafter referred to as "TAMC"; and the Cities of
Alameda, Healdsburg, Lodi, Lompoc, Palo Alto, Redding, Roseville,
Santa Clara, and Ukiah; the Sacramento Municipal Utility
District; the Modesto Irrigation District; the Turlock Irrigation
District; and the Plumas-Sierra Rural Electric Cooperative.
WHEREAS:
A. on December 100 1984, TAMC was duly established as a
.joint powers agency, pursuant to Section 6500 et seq. of the
California Government Code, by an agreement among the Members
entitled "Joint Powers Agreement, Transmission Agency of Northern
California"; and
B. TAMC, in its own name, or for the benefit of its
Members, ham the power to acquire by purchase or eminent domain,
construct, finance, operate and maintain facilities for electric
power transmission including, without limitation, the power to
purchase, lease, operate, develop, contract for, cr own, new or
upgraded transmission lines, and facilities for the benefit of
the Members; and
C. Each Member of TANC c•ns and operates a system for the
distribution of electric power and energy, and is authorized to
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obtain transmission facilities or rights to use transmission
facilities for its present or future requirements, through
contracts with TAMC or otherwise; and
D. IANC, on behalf of its Members, executed the
December 19, 1984, "Memorandum of Understanding, California -
Oregon Transmission Project," among certain California entities
and the Western Area Power Administration, which sets forth
principles for the development of the California --Oregon
Transmission Project including the designation of TANC as Project
Manager; and
E. The Members of TANC entered into the June 19, 1985,
"Project Agreement" for the purposes of issuing and selling a
promissory note for financing studies and other preliminary costs
to be incurred prior to making a decision, after environmental
and other review, of whether to undertake construction of the
California -Oregon Transmission Project; and
F. The Members of TANC entered into the September 30, 1985,
"TAMC Project Agreement No. 2 for the California -Oregon
Transmission Project" for the purpose of refinancing the
promissory note and to fund certain feasibility and planning
studies, and to provide for TANC's share of the costs for Project
Development Work for the California -Oregon Transmission Project;
I and
G. TAMC, on behalf of its Members, executed the
September 30, 1985, "California -Oregon Transmission Project
Development Agreement" for the purpose of completing required
activities such as obtaining approvals, certificates, licenses
and permits as required by law and regulation before undertaking
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construction of the Project; and
H. TANC, on behalf of its Members, entered into the
Memorandum of Understanding Annex dated February 6, 1986, with
the initial Participants and additional non-federal public
entities which allocated a 3.125 percent Project entitlement
among the additional Participants and re -allocated the remaining
entitlement among the initial Participants; and
I. The Members of TAMC desire to authorize TAMC to
undertake additional responsibilities as a Participant -in the
California -Oregon Transmission Project on behalf of the Members,
and recognize the desire of all Participants in the California -
Oregon Transmission Project for TANG to perform the duties of
Project Manager, including the duties and responsibilities
described in the "Memorandum of Understanding, California -Oregon
Transmission Project," and the "Project Participation Agreement,"
as defined in this Agreement; and
J. On January 20, 1988, TAMC certified the Final
Environmental Impact Report for the California -Oregon
Transmission Project, the Los Banos -Gates Transmission Project,
and the Pacific Northwest Reinforcement Project, made findings
pursuant to the California Environmental Quality Act, and
approved the California -Oregon Transmission Project; and
K. Each Member executing this Agreement has participated in
(the preparation and review of the Draft Environmental Impact
IReport and has reviewed and approved the Final Environmental
(Impact Report for the California -Oregon Transmission Project and
adopted the findings made by TANC as lead agency for the
California -Oregon Transmission Project.
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NOW, THEREFORE, in consideration of the mutual covenants and
conditions set forth in this Agreement, TAMC and the Members
agree as follows:
11.
DEFINITIONS
whenever used in this Agreement, the following terms shall
have the following meanings. The singular of any term shall
include the plural and the plural shall include the singular.
1.1 "Acquisition and Construction Work" - Any work
necessary or useful for acquisition and construction of the
Project, including procurement of materials and any land or
rights in land in connection therewith; _qnd, in addition, that
work to be done pursuant to or in the negotiation of the Intertie
Agreements for: management and administrative services;
economic, legal, engineering, and other activities; and services
which may be necessary or convenient in connection with the
Intertie Agreements.
1.2 "Addition" - A new facility, other than a Betterment
or Replacement, that is added to the Project, together with
associated land rights, if any.
1.3 "Agreement" - This Project Agreement No. 3 among the
Members and TAMC, as amended and supplemented from time to time
in accordance with the terms hereof.
1.4 "Betterment" - A new facility, other than a
Replacement, together with associated land rights, if any, which
will increase the "Rated Project Transfer Capability" (as that
term is defined in the Intertie Agreements) above the then-
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current Rated Project Transfer Capability or sixteen hundred
(1600) megawatts, whichever is less.
1.5 "Closing Date" - The date of each issuance of TANC
Project Indebtedness, as determined and announced by written
notice from TAMC to all TANC Members, as further described in
(Section 4.1.1.
1.6 "Debt Service" - With respect to any period, the
aggregate of the amounts required by each Indenture to be paid
during said period into any fund or account created by the
Indenture for the sole purpose of paying or providing reserves,
for paying the principal (including sinking fund installments) of
and premium, if any, and interest on all the Indebtedness from
time to time outstanding; provided, howevgr, that Debt Service
shall not include any amounts on account of acceleration of the
maturity of any Indebtedness.
1.7 "Electric System" - All properties and assets, real
and personal, tangible and intangible, of any Member (whether
leased or owned) now or hereafter existing, used for or
pertaining to the generation, transmission, transformation,
distribution and sale of electric capacity and energy, including
all additions, extensions, expansions, improvements and
betterments thereto and equipping thereof; grovided, however,
that to the extent the Member is a joint owner of an asset or
property, only the Member's ownership interest in such asset or
property shall be considered to be part of its Electric System.
1.8 "Executive Committee" - A committee appointed by the
TAMC Commission to which it may delegate certain responsibilities
as provided in resolutions duly adopted by the TANC Commission
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I pursuant to the Joint Powers Agreement.
2 1.9 "Fiscal Year" - The twelve-month period terminating on
3 September 30 of each year, or any other annual accounting period
4 hereafter selected and designated by TANC as its Fiscal Year for
S purposes of this Agreement and each Indenture.
6 1.10 "Indebtedness" - Bonds, notes or other evidences of
7 indebtedness (including, without limitation, contracts relating
8 to letters of credit or other credit enhancement devices and
9 long-term contracts,which are characterized as debt by TAMC at or
10 prior to execution thereof) issued or otherwise incurred or
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11 entered into by or on behalf of TANC in connection with the
12 Project. For purposes of this Agreement, Indebtedness shall be
13 considered outstanding as of any date if such Indebtedness has
14 not been paid or if provision for the payment of the principal of
15 and iisterest on such Indebtedness has not been made in accordance
16 with the Indenture pursuant to which such Indebtedness has been
17 issued or incurred.
18 1.11 "Indenture" - One or more indentures or other
19 instruments approved or adopted by TANC providing for the
20 issuance or incurring of Indebtedness.
21 1.12 "Interest Charge" - That charge against unpaid amounts
22 due and owing in accordance with this Agreement assessed at an
23 annual interest rate compounded monthly equal to the lesser of
24 (i) two percent (2%) plus the applicable first of the month
25 reference rate or successor, of the Bank of America N.T. & S.A.,
26 San Francisco, California, in effect from time to time during the
27 period over which the payment is overdue or (ii) the maximum
28 interest rate permitted by law.
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1.13 "Tntertie Agreements" - Agreements related to the
Project which have been or which may be entered into by TAMC and
some or all of the other Participants, which include, but are not
limited to, the MOU, the Project Development Agreement, the
Project Participation Agreement, any amendments to the foregoing
agreements, and other agreements related to the Project entered
into by TAMC as Project Manager or by TAMC on behalf of the
Members.
1.14 "Joint Powers Agreement" - The.Joint Poweru Agreement,
Transmission Agency of Northern California, dated December 10,
1984, which established TANG as a joint powers agency pursuant to
Section 6500 et seq. of the California Government Code, as
amended and supplemented from time to time.
1.15 "Management Committee" - A committee as described in
the MOU and further described in the Intertie Agreements.
1.16 "Member" - Any of the Cities of Alameda, Healdsburg,
Lodi, Lompoc, Palo Alto, Redding, Roseville, Santa Clara, and
Ukiah; the Sacramento Municipal Utility District; the Modesto
Irrigation District; the Turlock Irrigation District: or the
Plumas-Sierra Rural Electric Cooperative, which, at any given
point in time, is a party to the Joint Powers Agreement and
retains its rights and interests under this Agreement.
1.17 "MOU" - The Memorandum of Understanding, California -
Oregon Transmission Project, dated December 19, 1984, among the
Participants, the Department of Water and Power of the City of
Los Angeles, and the California Department of Water Resources, as
(modified by the Memorandum of Decision of the United States
,Secretary of Energy, dated February 7, 1985, as interpreted by
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the letter of the United States Department of Energy Acting
General Counsel, dated May.4, 1985, a copy of which is attached
hereto as Appendix A, as amended by the Memorandum of
Understanding Annex, and as it may be further amended.
1.18 "Memorandum of Understanding Annex" - The agreement
among the Participants, the California Department of Water
Resources, and the Department of Water and Power of the City of
Los Angeles executed on February 61 1986 which modified the MOU
and allocated a 3.125 percent Project entitlement to certain non-.'
federal public entities set out at 50 Fed. Req.:2769 (1.985) and
simultaneously reduced the existing Participants' entitlements by
a corresponding percentage, a copy of which is attached hereto as
Appendix B.
1.19 "operating Agent" - The Participant designated in the
Intertie Agreements to have the duties and responsibilities for
the overall operation and maintenance of the Project.
1.20 "opRosing ,Member" - A Member which votes against a
Betterment or Addition in accordance with Section 3.1.2.2.1 or
13.1.2.2.2.
1.21 "participants" - Those entities, including TAMC, which
have interests in the Project through execution of the Intertie
Agreements.
1.22. "Participation Percentage" - That percentage of TANC's
entitlement to Transfer Capability which an individual Member of
TANC has the right to use as set forth in Appendix C of this
Agreement. Such percentages may be modified pursuant to Sections
2.3, 3.1.2.2, 6, and 15.
1.23 "PDA" - Project Development Agreement.
fM
1 1.24 "Phase" or "Phases" - Those activities of the Project
2 described in Section 2.2.-
3 1.25 "Project" - The California -Oregon Transmission
4 Project, which consists of electric transmission facilities
5 between California and the Pacific Northwest, as such Project is
6 generally described in, and as changed pursuant to, the Intertie
7 Agreements.
8 1.26 "Project -Development Agreement" - That agreement among
9 the Participants dated September 30, 1985, which provides, inter
10 glia, for the Participants to share the costs of Project
11 Development Work.
12 1.27 "PKoject Development Work" - That work described in
13 Appendix A of the PDA, or consistent with and within the scope of
14 Appendix A of the PDA and approved by the Management Committee to
15 be performed in accordance with the PDA.
16 1.28 "Project Manager" - The entity designated by the
17 parties to the MOU and the Intertie Agreements which :.as the
is overall management responsibility for the Acquisition and
19 Construction Work of the Project.
20 1.29 "Project Participation Agreement" - That agreement
21 which may be executed by those Participants electing to proceed
22 with Phase II and Phase III of the Project, as it may be modified
23 and supplemented in accordance with the terms thereof.
24 1.30 "Replacement" - A new facility that is intended to be
25 a direct replacement for an existing facility, which is designed
26 primarily to maintain the existing operational reliability or
27 capability of the Project, irrespective of whether the
28 replacement results in an incidental increase in the "Rated
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I Project Transfer Capability" (as that term is defined in th(
2 Intertie Agreements), and which results in a "retirement unit"
3 being substituted for another such retirement unit. As used
4 herein, "retirement unit".shall mean property as defined in
5 Section 15060 of the Federal Energy Regulatory Commission uniform
6 System of Accounts Prescribed for Public Utilities and Licensees
7 Subject to the Provisions of the Federal Power Act, or its
8 successor document.
9 1.31 "Revenues" - All income, rents, rates, fees, charges,
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10 and other moneys derived by a Member from the ownership or
11 operation of its Electric System, including, without limiting the
12 generality of the foregoing (i) all income, rents, rates, fees,
13 charges, or other moneys derived from the sale, provision, and
14 supply of electric capacity and energy and other services,
15 facilities, and commodities sold, furnished, or supplied through
16 the facilities of the Electric System, (ii) the earnings on and
17 income derived from the investment of such income, rents, rates,
is fees, charges, or other moneys to the extent that the use of such
19 earnings and income is limited to the Electric System by or
20 pursuant to law and (iii) the proceeds derived by such Member
21 directly or indirectly from the sale, lease, or other disposition
22 of a part of the Electric System as permitted hereby; but the
23 term "Revenues" shall not include customers' deposits or advances
24 subject to refund or contributions in aid of construction until
25 such deposits, advances, or contributions have become the
26 property of the Member.
27 1.32 "TANC Capital Improvement Costs" - Those costs
28 incurred in connection with Phase III of the Project allocable to
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TANC for the purpose of making Additions, Betterments, or
Replacements to the Project and such other costs relating to
capital improvements to the Project properly chargeable to TAMC
pursuant to the Intertie Agreements.
1.33 "TANC Commission" - The governing body of TANC as
described in the Joint Powers Agreement.
1.34 "TANC Coordinator" - An entity appointed by TANC to,
inter alia, coordinate the Members' use of TANC's entitlement to
Transfer Capability.
1.35 "JANC ProjectCosts" - Those costs incurred in
connection with Phase II of the Project allocable to TANC and
such other costs relating to the acquisition and construction of
the Project properly chargeable to TANC pursuant to the Intertie
I Agre•.-nents.
1.36 "TANC Project Indebtedness" - That Indebtedness to be
issued by TANC to finance TANC Project Costs, TANC Project O&M
Costs, TANC Capital Improvement Costs, and such other costs as
are described in Section 4.1.3.1.
1.37 "TANC Project 0&M Costs" - Those costs incurred in
connection with Phase III of the Project allocable to TANC which
are necessary to operate and maintain the Project, such other
costs relating to the operation and maintenance of the Project
properly chargeable to TANC pursuant to the Intertie Agreements,
and costs of the TANC Coordinator. TANC Project O&M costs shall
not include TANC Project Costs or TANC Capital Improvement Costs.
1.38 "Transfer Capability" - The ability of the Project or
a segment thereof to transmit power, expressed in megawatts, as
determined in accordance with the Intertie Agreements. As used
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in this Agreement, the term "Transfer Capability" can refer to a
rated amount or an amount available at any given time, as
appropriate in the context in which such term is used. TAMC and
its Members acknowledge that there may be times when available
Transfer Capability is less than the rated amount for the Project
or a segment thereof.
1.39 "Trustee" - Any trustee, including any successor
trustee, under an Indenture.
2. PROJECT PARTICIPATION AND AUTHORIZATION
2.1 Scope - TANC is hereby authorized and directed to act
on behalf of the Members in activities related to Phase II and
Phase III of the Project, as more fully described below, as a
Participant pursuant to the Intertie Agreements, subject to
procedures for Member approval and authorization established by
the TANC Commission pursuant to this Agreement and the Joint
Powers Agreement. TANC is also hereby authorized to fulfill its
duties and responsibilities as Project Manager or under any other
management role pursuant to the Intertie Agreements.
2.2 Phases - The Project shall proceed in accordance with
the following activities:
2.2.1 Phase I activities consist of Project.
Development Work;
2.2.2 Phase II activities consist of Acquisition and
Construction Work;
2.2.3 Phase III activities consist of operation,
maintenance, Additions, Betterments, Replacements, and the
retirement or disposal of the Project.
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1 2.3 Participation
2 2.3.1 Pursuant to Paragraph 15 of`the Joint Powers
3 Agreement, the Members executing this Agreement each hereby
4 (i) approve TANC's participation in the Project as a
5 Participant in accordance with, and to the extent pzovided
6 in, the Intertie Agreements and this Agreement and (ii)
7 elect to participate in Phases II and III of the Project in
s the Participation Percentages set forth in Appendix CO as
9 those percentages may be revised in accordance with this
10 Agreement. In consideration of such approval and election,
11 and payment of its share of the costs set forth in
12 Section 4, each Member shall be entitled to its respective
13 Participation Percentage share of TANC's entitlement to
14 Transfer Capability on the terms and conditions provided for
15 by this Agreement. In the event that the first issuance and
16 sale of TANC Project Indebtedness does not occur within six
17 (6) months after the date of this Agreement, any Member may
1s) terminate its participation under this Agreement by giving
191 written notice to TAMC, in which case the Participation
20 Percentage of such Member shall be divided pro rata among
21 the remaining Members based on Participation Percentages,
22 unless otherwise agreed to by such remaining Members. After
23 the first issuance and sale of such TANC Project
24 Indebtedness, no Member may terminate its participation in
25 th;.s Agreement.
26 2.3.2 In the event that TANC's entitlement to
27 Transfer Capability changes from time to time, within sixty
28 (60) days after such change, the Members shall be permitted
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to revise the Participation Percentages set forth in
Appendix C without an amendment to this Agreement,,subject
to the following conditions:
2.3.2.1 The Participation Percentages set
forth in Appendix C shall govern in the event that the
Members are unable to agree to such a revision to
Appendix C;
2.3.2.2 No Member shall be required to
accept a Participation Percentage which, when
multiplied by TANC's megawatt entitlement to Transfer
Capability, would exceed the megawatt amount set forth
in the Appendix C, Column D, in which event such
excess Participation Percentage shall be divided pro
rata among the other Members based on Participation
Percentages, unless otherwise agreed to by such
Members;
2.3.2.3 No Member may agree to a
Participation Percentage which, when multiplied by
TANC's megawatt entitlement to Transfer Capability,
would be less than the megawatt amount set forth in
Appendix C, Column C;
2.3.2.4 No Member may agree to a
Participation Percentage which, when multiplied by
TANC's megawatt entitlement to Transfer Capability,
would exceed the megawatt amount set forth in
Appendix C, Column D, if the effect of such agreement
would be to materially, adversely alter any rights of
or security for holders of TAMC Project Indebtedness.
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2.3.3 Members acknowledge and agree that;
notwithstanding the foregoing provisions, Member defaults
may result in a non -defaulting Member accepting a megawatt
amount in excess of the limits set forth in Appendix C,
Column D. Members also acknowledge and agree that,
notwithstanding the foregoing provisions, no such agreement
shall result in aggregate Participation Percentages of the
Members of less than one hundred (100) percent.
DUTIES AND RESPONSIBILITIES OF TAMC DURING PHASE II AND
PHASE III
3.1 Decisions - Decisions related to the Project shall be
wade by the TAMC Commission at meetings to be held at times and
places determined by the TANC Commission; provided, that the TANC
Commission may delegate decisions to its Executive Committee or
others, between meetings, as provided in resolutions duly adopted
by the TANG Commission pursuant to the Joint Powers Agreement.
3.1.1 The exercise of the rights and obligations of
TAMC under this Agreement shall be subject to the control at
all times of the TAMC Commission.
3.1.2 Voting - Approvals or authorizations required
under this Agreement shall be given or withheld by the TAMC
Commission using the voting procedures described in the
Joint Powers Agreement, subject to the following provisions:
3.1.2.1 Phase II Activities - With regard to
Phase II activities as described in Section 2.2.2, to
constitute a quorum, the combined Participation
Percentages of the Members not in default represented
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by the TAMC Commissioners present must represent at
least sixty (60) percent of the aggregate
Participation Percentages of Members not in default at
the time of the vote and the action must be approved
by TANG Commissioners representing at least a majority
of the aggregate Participation Percentages of Members
not in default at the time of the vote.
3.1.2.2 Phase III Activities - With regard
to Phase III activities as described in Section 2.2.3,
to constitute a quorum, the comb ined'Participation
Percentages of the Members not in default represented
by the TANC Commissioners present must represent at
least sixty (60) percent of the aggregate Participa-
tion Percentages of Members not in default at the time
of the vote and the action must be approved by TAMC
Commissioners representing at least a majority of the
aggregate Participation Percentages of Members not in
default at the time of the vote, provided:
3.1.2.2.1 In the event that a
Member votes against a proposed Betterment,
such Opposing Member shall have no obligations
stemming from such Commission action nor shall
such Opposing Member have any right to
participate in the benefits of such Commission
action and, with regard to such benefits and
obligations, the Participation Percentage of
each Member except for the Opposing Member(s)
shall be increased to the ratio between each
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such Member's Participation Percentage and the
2
aggregate of the Participation Percentages of
3
the Members excluding such Opposing Member(s),
4
expressed as a percentage.
g
3.1.2.2.2 In the event that a
6
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7
the Project in any Fiscal Year, and TANC's
8
share of the cost of all Additions previously
9
approved in such Fiscal Year when added to
20
TANC's share of the cost of the proposed
11
Addition exceeds twenty-five million dollars
12
(525,000,000) adjusted in accordance with
13
changes in the Consumer Price Index (CPI) or
14
successor index using the January 1, 1990,
15
level as the base year, with regard to such
16
Opposing Member's Participation Percentage of
17
such excess amount only, such Opposing Member
is
shall have no obligations stemming from such
19
Commission action nor shall such Opposing
20
Member have any right to participate in the
21
benefits of such Commission action. With
22
regard to the rights and obligations
23
associated with such excess amount, the
24
Members excluding such Opposing Member(s)
25
shall negotiate appropriate adjustments to
26
their Participation Percentages.
27
3.1.2.2.3 In the event that a
28
Member votes against a proposed Replacement,
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such Member shall nevertheless be bound by the
outcome of such Commission action.,
3.1.2.2.4 Nothing contained herein
is intended to relieve any Member from its
obligations resulting from Commission action
except as specifically provided in Sections
3.1.2.2.1 and 3.1.2.2.2.
3.1.2.2.5 Each agreement by the
Members with respect to Betterments or
Additions shall specifically recognize TANC's
rights under this Agreement which secure TAMC
Project Indebtedness.
3.2 Specific Duties and Responsibilities - TANC, through
the approval of the TAMC Commission, shall be empowered to
perform all duties appropriate for the implementation of Phase II
and Phase III of the Project, subject to the terms hereof,
including but not limited to:
3.2.1 Act as Project Manager or in any other
managerial role for the Project in accordance with the
Intertie Agreements;
3.2.2 Authorize (i) the issuance or incurrence of
Indebtedness and the appropriate documentation related
thereto, (ii) the contract of purchase or notice of sale or
other instrument under which Indebtedness is to be sold or
incurred, (iii) the selection of managing underwriters for
Indebtedness (if such Indebtedness is to be sold upon a
negotiated basis), and (iv) the manner and timing of
marketing (including the manner of sale), if applicable,
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interest rates, and other terms of Indebtedness;
3.2.3 Provide periodic reports of major construction
and major events to the Members with respect to the Project;
3.2.4 Review, discuss, and attempt to resolve any
disputes among TAMC and/or the Members;
3.2.5 Negotiate, review, approve, execute, enforce
and modify Intertie Agreements as a Participant on behalf of
the Members for Phase II and Phase III and perform all
activities necessary to fulfill TANC's obligations as a
Participant under those agreements;
3.2.6 Approve and engage consultants or advisors on
financial, economic, engineering, environmental, management,
and legal or other matters;
3.2.7 Review, modify, and approve TANC's insurance
program including, without limitation, the establishment of
a self-insurance program;
3.2.8 Incur costs, liabilities, and obligations;
3.2.9 Purchase, sell, rent, and lease equipment,
apparatus, materials, and supplies and establish and
maintain inventories of any of the foregoing;
3.2.10 Acquire by purchase or eminent domain any
interest in property, real or personal;
x.2.11 Enforce, waive, adjust or compromise any claim
by or against TANG, including claims covered by or relating
to insurance policies;
3.2.12 Initiate, defend, and otherwise participate in
legal and administrative proceedings;
3.2.13 Maintain for Member inspection and audit for
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1 the term of this Agreement, and for three (3) years
2 thereafter, books and cost records of TANC in accordance
3 with generally accepted accounting principles;
4 3.2.14 Perform other tasks as may be necessary to
S fulfill its obligations as a Participant, as Project
6 Manager, and in any other managerial role under this
7 Agreement and the Intertie Agreements during Phase II and,
8 Phase III of the Project in a timely, cost effective manner.
9
10 4. OBLIGATIONS OF MEMBERS DURING PHASE TI AND PHASE III
11 4.1 TAMC Pro'e� ct Costs - Subject to Section 3.1.2.2, each
12 Member agrees to pay, based on its Participation Percentage, its
13 portion of TAMC Project Costs, its portion of TAMC Project O&M
14 Costs, its portion of TAMC Capital Improvement Costs, and its
15 portion of Debt Service on TAMC Project Indebtedness, in each
16 case as provided in this Section 4.1:
17 4.1.1 At least sixty (60) days prior to the initial
ig Closing Date and at least sixty (60) days prior to the
19 commencement of each Fiscal Year thereafter, the TAMC
20 Commission shall develop, approve, and distribute to the
21 Members a budget for TANC Project Costs, Debt Service for
22 TANC Project Indebtedness, TAMC Project O&M Costs, and TAMC
23 Capital Improvement Costs which the TANC Commission
24 estimates will be incurred during the then -current Fiscal
25 Year in the case of the initial budget and during the next
26 succeeding Fiscal Year for all subsequent budgets. Such
27 budgets shall be generally. based upon budgets approved by
28 the Management Committee and upon TANC's estimates of TANC
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1 Project Costs, Debt Service for TANC Project Indebtedness,
2 TANG Project O&M Costs, and TAMC Capital Improvement Costs;
3 provided, that if a budget has not been approved by the
4 Management Committee the budget shall be based upon TANC's
g est.mates. Each budget other than the initial budget shall
6 also include a variance report which compares actual
7 expenditures wi%h budgeted amounts for the previous Fiscal
8 Year. As soon as practicable after the approval of each
9 such budget, TAMC shall mail the budget to the Members.
10 Members acknowledge and agree that Participant defaults or
11 withdrawals that result in changes in TANC's ownership
i
12 interest in the Project will require changes in TANC's
13 payment obligations under the Intertie Agreements
14 approximately proportionate to the change in TANC's
1s entitlement to Transfer Capability and a corresponding
16 change in the Members' payment obligations hereunder. TANG,
17 if requested by any Member, will make best efforts to
1A remarket any entitlement to Transfer Capability that such
19 Member or its designated agent may determine to be in excess
20 of that Member's requirements. Remarketing efforts will be
21 focused on the other Members, the Western Area Power
22 Administration, the California Department of Water
23 Resources, and other Participants. Members also acknowledge
24 and agree that some anticipated Participants may elect not
25 to enter into the Intertie Agreements for Phase II and
26 Phase III of the Project and that this Agreemer•t. is intended
27 to perm -;t the Project to be constructed without such
28 anticipated Participants so that TANC's ownership interest
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I in the Project, and thus the amount of Trans fer'Capabi1ity
2 to which each Member shall be entitled pursuant to this
3 Agreement, will vary depending on the final ownership
4 interests established for TANC and the other Participants
5 pursuant to the Intertie Agreements. TANC currently
6 anticipates that, at the time of execution of the Intertie
7 Agreements, the Intertie Agreements will establish TANC's
8 initial ownership interest in the Project at a minimum of
9 42.2916% and a maximum of 93.753.
10 4.1.2 Each of the Members hereby approves the
11 issuance and sale of IANC Project Indebtedness as provided
12 in Section 4.1.3.1 below subject to approval of the TANC
13 Commission pursuant to Section 3.1.2. S::ch approvals are
14 intended to be and are limited to the approvals required by
15 Paragraphs 6 and 15 of the Joint Powers Agreement. Such
16 Indebtedness shall not constitute a debt, liability or
1: obligation of any of the Members and shall not constitute a
18 debt of TAMC payable by the Members pursuant to Paragraph 21
19 of the Joint Powers Agreement.
20 4.1.3 Subject to Section 3.1.2.2, each of the
21 Members hereby severally requests and agrees as follows:
22 4.1.3.1 Each Member requests that TANC
23 issue, sell, or otherwise incur Indebtedness from time
24 to time pursuant to the provisions of Chapter 5,
25 Division 7, Title 1 of the Government Code of the
26 State of California or any other applicable provisions
27 of law in amounts which will be sufficient to permit
2811 TANC to pay, when due, all TANC Project Costs, TANC
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Project O&M Costs through the first full Fiscal Year
after completion of the Project, TANG Capital
Improvement Costs, costs of issuance, credit
enhancements and other costs incurred in connection
with the issuance or incurring of TANC Project
Indebtedness, and to provide for capitalized interest
as e-Aermined by TANC and for required deposits to
funds and accounts established by each Indenture and,
in addition, to provide for the principal and interest
on all Indebtedness outstanding on the initial Closing
Date (all of said Indebtedness to constitute TANC
Project Indebtedness). Whenever TANC deems it
beneficial to the Members, as a result of Debt Service
savings or otherwise, upon approval of the TANC
Commission, TANC may issue Indebtedness to refund
outstanding TANC project Indebtedness (which the
Members hereby authorize) and the same shall be TANC
Project Indebtedness.
4.1.3.2 Each Member severally agrees to pay
to TANC an amount equal to its Participation
Percentage of all Debt Service on the TANC Project
Indebtedness to enable TANC to pay such Debt Service
at the times and in the manner set forth in the
applicable Indentures. Each Member also agrees to pay
to TANC, in accordance with Section 22, an amount
equal to its Participation Percentage of TANC Project
Costs, TANC Project O&M Costs, and TANC Capital
Improvement Costs, not financed by TAMC Project
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Indebtedness as indicated in the budgets prepared
pursuant to Section 4.1.1, including any budget
revisions made pursuant to Section 4.1.5.
4.1.3.3 Upon failure of a Member to make any
of the payments described in Section 4.1.3.2, TAMC
shall make demand upon such Member, and if said
failure is not remedied within forty-five (45) days
from the date of such demand, it shall constitute a
default at the expiration of such forty-five (45) day
period. Such default shall be handled in accordance
with Section 6. Notice of such demand shall be
provided to the other Members.
4.1.3.4 Each Member agrees to establish
rates and charges for its Electric System so as to
provide Revenues sufficient, together with other
available funds derived from its Electric System, to
pay, when due, all amounts payable by such Member
under this Agreement and to pay all other amounts
payable from, and all lawful charges against or liens
upon, the Revenues of its Electric System.
4.1.3.5 Each Member shall be obligated to
make payments under this Section 4.1.3 and to budget
for such payments solely from the Revenues of, and as
an operating expense of, its Electric System. Each
Member shall make the payments required of it by this
Agreement in the amounts and at the times determined
pursuant to this Agreement and such payments and the
obligation to make same shall be absolute and
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unconditional and such payments shall be made whether
or not the Project or any part thereof has been
completed, is operating pr operable or its output or
.capability is suspended, interrupted, interfered with,
reduced or curtailed, or terminated in whole or in
part, and such payments shall not be subject to
reduction whether by offset, counterclaim, recoupment
or otherwise and shall not be conditioned upon the
performance or nonperformance by any party to any
agreement or for any other cause or reason whatsoever."
4.1.3.6 Each Member covenants and agrees
that it shall, at all times so long as any IANC
Project Indebtedness remains outstanding, operate the
properties of its Electric System and business in
connection therewith in an efficient manner and at a
reasonable cost and shall maintain its Electric System
in good working order and condition, and shall
cooperate with TANC in the performance of the
respective obligations of TANC and such Member under
this Agreement.
4.1.3.7 Each Member agrees that all rights,
title, and interest of TAMC in and to all payments
required to be made under this Section 4.1.3 by the
Members pursuant to the provisions hereof may be
pledged and assigned under the Indentures to secure
the TANC Project Indebtedness.
4.1.4 Funds received by TANC from the issuance and
sale of TAMC Project Indcbtedness shall be applied to one or
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more of the purposes specified in Section 4.1.3.1 in
accordance with the Indenture authorizing such TANC Project
Indebtedness.
4.1.5 TANC may, from time to time, revise the
budgets established pursuant to Section 4.1.1 as necessary.
Such budgets shall include adjustments for variances between
estimated and actual costs included in previous budgets. In
that event, subject to Section 3.1.2, the procedures of
Sections 4.1.2 through 4.1.4 shall be followed for payment
of any additional costs.
15. TERM, TERMINATION, AND AMENDMENTS
5.1 Tern - This Agreement shall take effect as of the date
hereof and shall remain in full force and effect during the term
of the Joint Powers Agreement and the Intertie Agreements (as
their terms may be extended) or so long as any TANC Project
Indebtedness remains outstanding, whichever is longer.
5.2 Termination - This Agreement shall not be subject to
termination by TANC or any Member under any circumstances,
whether based upon the default of any party under this Agreement,
or any other instrument, or otherwise.
5.3 Amendments - So long as any TANC Project Indebtedness
is outstanding, this Agreement may be amended, modified, or
otherwise changed or rescinded, except as provided in the
applicable Indentures, so long as such amendment, modification,
change, or rescission would not materially, adversely alter any
rights of or security for holders of such Indebtedness. Except
as provided in Section 8.3, this Agreement may be amended only by
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the written agreement of all of the parties hereto.
6. DEFAULT
6:1 Defaulting Member's Parti ipation Percentage - Upon
the failure of any Member or, with respect to its obligations
under Section 15, a former Member who has withdrawn, to meet its
obligations hereunder, TAMC shall give written notice of the
failure to such Member or former Member who has withdrawn and, if
such failure has not been cured within forty-five (45) days after
the date of such notice, it shall constitute a default at the
expiration of such forty-five (45) day period. Upon such
default, in addition to the rights and remedies available to TANG
pursuant to Section 6.2, TANC may protect and enforce its rights
hereunder by suit or suits in equity or at law, whether for the
specific performance of any covenant herein or for damages or in
aid of the execution of any power granted herein or any other
remedy available under any provision of applicable law. No
remedy by the terms of this Agreement conferred upon or reserved
to TANC is intended to be exclusive of any other remedy, but each.
and every such remedy shall be cumulative and shall be in
addition to every other remedy given under this Agreement or
22 existing at law or in equity or by statute on or after the
23 effective date of this Agreement.
24 6.2 Nondefaulting Member's Participation Percentage - Upon
25 any default described in Section 4.1.3.3, the defaulting Member
261ishall no longer be entitled to any rights granted to the Members
27 with respect to the Project, and each Member severally agrees
28 that the Participation Percentage of each nondefaulting-Member
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I shall be automatically increased as follows:
2 6.2.1 Each Member severally agrees that the
3 Participation Percentage of each nondefaulting Member shall
4 be automatically increased to the ratio between such
S nondefaulting Member's Participation Percentage and the
6 aggregate of the Participation Percentages of this
7 nondefaulting Members, expressed as a percentage. For
s purposes of this Section 6.2.1 and Section 6.2.2, the term
9 "Member" shall include, but not be limited to, each former
10 Member who has withdrawn from TANC and converted its
11 Participation Percentage of TANC's entitlement to Transfer
12 Capability to an ownership interest in the Project pursuant
13 to Section 15, and the term "Participation Percentage" shall
14 mean that percentage which would represent such withdrawn
is Member's Participation Percentage of TANC's entitlement to
16 Transfer Capability if such conversion had not occurred.
17 6.2.2 Notwithstanding the provisions of Section
is 6.2.1, the cumulative increase for any nondefaulting Member
19 pursuant to this Section 6.2 shall not exceed twenty-five
20 percent (25%) of its Participation Percentage in effect
21 immediately prior to the first default without the consent
22 of the Member; provided, that for purposes of determining
23 such cumulative increase any increase (i) pursi)ant to
24 Section 2.3 or 3.1.2.2, or (ii) which results because a
25 Member has withdrawn from TANC and converted its
26 Participation Percentage of TANC's entitlement to Transfer
27 Capability to an ownership interest in the Project pursuant
28.1to Section 15, shall not be considered. The nondefaulting
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Members shall be entitled to the rights which the defaulting
Member loses upon the default and shall assume subject to
Section 6.3 all of the obligations of the defaulting Member
with respect to such rights hereunder. Increases in the
Participation Percentages of the nondefaulting Members shall
be applicable to any payments due and not paid by the
defaulting Member at the time of the increase and all
subsequent payments due and not paid by the defaulting
Member.
6.3 Defaulting -Member's Obligations - Each Member agrees
that increases in the obligations of other Members pursuant to
12 Section 6.2 shall not relieve the defaulting Member or a former
13 Member who has withdrawn, of its liability for its obligations
14 described hereunder. The nondefaulting Members shall have a
15 right of recovery from the defaulting Member to the extent of
16 increases in their obligations resulting from such default (plus
17 interest at the Interest Charge) from the date of such default
18ij until paid.
19 6.4 Tax Covenant - Notwithstanding any other provision of
20 this Agreement, no Member shall transfer, assign, sell or
21 exchange any portion of its Particir.+tion Percentage of TANC's
22 entitlement to Transfer Capacity, or my ether interest in the
23 Project or the capacity or capability thereof, directly or
24 indirectly, in any manner, or shall take, or to the extent it can
25 control the same permit to be taken, any c -her action or actions,
26 which would adversely affect the exclusion of the interest on any
27 of the TANC Project Indebtedness from gross income for federal
28: income tax purposes under Section 103 of the Internal P.evenue
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Code of 1986, as amended, and the applicable regulations
thereunder (or any successors to such statute and regulations),
including without limitation, by reason of classification of such
TAMC Project Indebtedness as a "private activity bond" within the
Imeaning of said Code.
17.
USE OF TRANSFER CAPABILITY
7.1 Member Use of Transfer Capability - Subject to the
provisions of this Section 7, Section 6.4, and Section 8 hereof,
each Member shall have the right to use its Participation,
Percentage of TANC's entitlement to Transfer Capability for any
purpose, including holding such Transfer Capability in reserve or
making such Transfer Capability available to a Member,
Participant, or other entity, subject to the terms and conditions
relating to assignments and layoffs by Participants under the
Intertie Agreements; provided, that before a Member may make
unneeded Transfer Capability avcilable to a non -Member, it shall
make such Transfer Capability available to the other Members on
(terms and conditions which are established by the TANC
Commission. Nothing in this Section 7.1, however, shall prohibit
a Member or its designated agent from requesting that the TANC
Coordinator make all or part of such Member's unused Transfer
`Capability available to other Members on behalf of such Member.
7.2 Non -Member Use of Transfer Capability - Each Member or
its designated agent shall notify the TANC Coordinator in the
event that it does not need all or a portion of its Participation
Percentage of TANC's entitlement to Transfer Capability and no
other Member needs such Transfer Capability. In such event, the
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TAMC Coordinator shall then make such Transfer Capability.
available to the other Participants pursuant to the provisions of
the Intertie Agreements. Otherwise, each Member or its
designated agent shall determine the disposition of its unneeded
Transfer Capability, which may include directing the TANC
Coordinator to make such Transfer Capability available to any
entity on such terms and conditions as such Member or its
designated agent may direct.
7.2.1 Compensation - Compensation for the_use of a
Member's Participation Percentage of TANC's entitlement to
Transfer Capability by other Participants will be as set
forth in the Intertie Agreements. In the event that the
provisions of the Intertie Agreements do not apply to the
transaction, compensation shall be as determined by each
Member making such Transfer Capability available.
7.2.2 Allocation of Revenue - Payments for the use
of TANC's unneeded entitlement to Transfer Capability by
non -Members shall be collected by TANC and promptly and
fully credited directly to the Member making such Transfer
Capability available. Each such Member agrees that all
right, title, and interest of such Member and TANC in and to
such payments may be pledged and assigned under the
Indentures to secure payments required to be made under
Section 4.1.3 by or on behalf of such Member.
7.3 MOU Layoffs - In accordance with Sections 10.1 and
10.2 of the MOU as implemented by the Intertie Agreements, TANC
shall lay off a portion of its entitlement to Transfer
Capability. Compensation to TANC by those entities receiving the
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layoff is to be based on TANC's Project Cost including financing
plus contingencies of twenty-five (25) percent.
7.3.1 Unless otherwise agreed by the Members, each
Member shall provide its portion of such layoffs in
accordance with the Member's Participation Percentage.
7.3.2 Payments for the layoff of TANC's entitlement
to Transfer Capability as described in Sections 10.1 and
10.2 of the MOU shall be collected by TAMC and promptly and
fully credited to the Members based on each Member's
Participation Percentage unless otherwise agreed by the
Members. Each such Member agrees that all right, title, and
interest of such Member and TAMC in and to such payments may
be pledged and assigned under the Indentures to secure
payments required to be made under Section 4.1.3 by or on
behalf of such Member.
7.4 In the event that a Member's Participation Percentage
of TANC's entitlement to Transfer Capability converted to
megawatts exceeds the megawatt amount in Appendix C, Column E,
layoffs made by TANC pursuant to Sections 7.2 and 7.3 shall first
be made from such excess amount if so requested by that Member.
If more than, one Member has such an excess amount and the sum of
all such excess amounts exceeds the amount of the layoff, the
layoff shall be made pro rata based on the ratio between each
such requesting Member's excess amount and the sum of all such
requesting Members' excess amounts.
7.5 Notwithstanding anything to the contrary contained in
this Section 7, no layoff of Transfer Capability made pursuant to
i this Section 7 shall excuse a Member from making the full
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payments required by Section 4 hereof nor reduce the amount or
extend the time of such payments.
I8. SCHEDULING
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8.1 Member Scheduling Rights - During any scheduling
period, each Member or its designated agent shall have the right
to schedule power transactions using Transfer Capability up to
the amount of its Participation Percentage of TANC's entitlement
to Transfer Capability, subject to the provisions of Section 7 of
this Agreement. Each Member or its designated agent may also
schedule power transactions over any additional percentage of
Transfer Capability that it has a right to use. Notwithstanding
the provisions of Section 8.2,. each Member or its designated
agent shall have the right to schedule such transactions pursuant
to its separate agreements with other entities. All power
scheduled over the Project shall be in whole megawatt amounts or
as otherwise set forth in the Intertie Agreements.
8.2 Project Use Information Coordination - Each Member or
its designated agent shall provide the TAMC Coordinator with
Project use information required to meet TANC's obligations under
the Intertie Agreements as a Participant in the Project. The
TANC Coordinator shall submit such information to the Operating
Agent in accordance with such agreements.
8.3 Scheduling and Curtailment Procedures - Specific
procedures which implement the provisions of this Section 8 and
Section 7 hereof are set forth in Appendix D. The Members and
their designated agents agree to comply with such procedures, as
they may be modified from time to time by a vote of the TANC
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Commission pursuant to Section 3.1.2.
9.
INSURANCE AND INDEMNIFICATION
TANG shall maintain, or cause to be maintained in force,
insurance as may be determined prudent in the judgment of the
TAMC Commission and as may be required by the provisions of the
Int-ertie Agreements and any Indenture. TANG shall indemnify,
defend, and hold harmless each Member, and its governing board
members, officers, employees and agents, from any liability for
personal.injury, death, or prop:_ty damage arising out of the
negligent activities of TANG pursuant to this Agreement or the
Intertie Agreements.
10. COMPLIANCE WITH OTHER INSTRUMENTS
It is -recognized by the parties hereto that, for the benefit
�of the Members, TANG, in undertaking, or causing to be
undertaken, the planning, licensing, financing, construction, and
operation of TANC's share of the Project, must comply with the
requirements of each Indenture, the Intertie Agreements, all
applicable licenses, permits, and regulatory approvals necessary
therefor, and the Joint Powers Agreement.
1111. LIABILITY OF TANC OFFICERS
11.1 Release - Each Member agrees that TANC's
Commissioners, officers, and employees shall not be liable to the
Members for direct, indirect or consequential loss or damage
suffered by the Members as a result of (i) the performance or
nonperformance by TANC under any Intertie Agreements or (ii) the
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performance or nonperformance of TANG under this Agreement. Each
Member releases TANC's Cozamissioners, officers, and employees
from any claim or liability (whether negligent or otherwise) as a
result ot,any actions or inactions of TAMC under this Agreement
or the performance or nonperformance by TANC under any Intertie
Agreement.
11.2 No ?codification - The provisions of this Section 11
shall not be construed so as to relieve.TANC of any obligations
under any of the Intertie Agreements and the provisions of this
Section 11 shall not be construed to modify or amend Paragraph 2
of the Joint Powers Agreement.
12. NOTICE AND COMPUTATION OF TIME
12.1 Manner of Notices - Any notice or demanci by a Member
to IANC under this Agreement shall be deemed properly given if
deposited in the United States mail first class postage prepaid
or its equivalent, or sent via facsimile or other electronic
media and confirmed by telephone or in writing within twenty-four
(24 hours), addressed to TAMC at its operational office; any
notice or demand by TAMC to any Member under this Agreement shall
be deemed prope-rly given if deposited in the United States mail
first class postage prepaid or its equivalent, or sent via
facsimile or other electronic media and confirmed by telephone or
in writing within twenty-four (24 hours), addressed to the
addressee shown on the signature pages hereof at the address
shown in Appendix E. The designations of the name and address to
which any such notice or demand is directed may be changed at any
28� time and from time to time by any party giving notice as above
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provided in this Section.
12.2 Time Computed - In computing any period of time from
such notice, such. period shall commence on the date mailed or, if
sent via facsimile or other electronic media, on the date sent.
13. APPLICABLE LAW
This Agreement is made under and shall be governed by the
laws of the State of California..
14. SEVERABILITY
If any section, paragraph, clause, or provision of this
Agreement, or any part thereof, shall be finally adjudicated by a
court of competent jurisdiction to be invalid, the remainder of
this Agreement shall remain in full force and effect as though
such section, paragraph, clause, or provisions or any part
thereof so adjudicated to be invalid had not been included
herein.
I
15. MEMBER'S RIGHT TO WITHDRAW
15.1 Conversion of Participation Percentage to Undivided
Ownership Interest - TANC's undivided ownership interest in the
Project shall constitute rights or property acquired and owned by
TAMC and no Member shall have an ownership interest in the
Project except upon withdrawal from TANC and conversion of its
Participation Percentage to an undivided ownership interest as
provided herein. After the commercial operation date of the
Pro4ect, each Member not then in default shall be entitled to
ti
! withdraw from TANC and convert its Participation Percentage into
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I an undivided ownership interest in the Project. Such Member's
2 undivided ownership interest shall be equal in amount to its
3 Participation Percentage multiplied by TANC's then undivided
4 ownership interest in the Project. Upon such withdrawal and
5 conversion, at the express written request of the withdrawing
6 Member, TAMC shall make best efforts to take such administrative
7 actions, including the execution of such documents and amendments
8 to the Intertie Agreements, as may be reasonably requested by the
9 withdrawing Member to establish and evidence such Member's
10 undivided ownership interest in the Project and such Member's
11 role as a Participant under the Intertie Agreements, and all
12 reasonable administrative and legal costs associated with such
13 unopposed withdrawal and conversion shall be the responsibility
14 of such withdrawing Member. Each Member electing to withdraw
15 from TANC and so convert its Participation Percentage shall hold
I,
16 its ownership interest as a tenant in common with TANG and the
17 other Participants as set forth in the Intertie Agreements.
1g 15.2 Procedure and Conditions - Notwithstanding Paragraphs
19 19 and 20 of the Joint Powers Agreement, a Member may withdraw
20 from TAMC and convert its Participation Percentage into an
21 undivided ownership interest in the Project by requesting that
22 TAMC assign to the Member an undivided ownership interest in the
23 Project as provided in Section 15.1 and all rights, interest, and
24 obligations related thereto, and by giving written notice to TANC
25 and all other former Members that have withdrawn at least one (1)
26 year in advance of the noticed effective date of withdrawal;
27 provided that:
28 15.2.1 TANC shall have one hundred eighty (180) days,
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from written notice given pursuant to Section 15.5, to
exercise a right of first refusal to any rights, interests,
and obligations in the Project (in whole or in part) which a
former Member that has withdrawn determines to sell,
transfer, assign, or otherwise dispose of pursuant to a bona
fide written offer. In the event that any farmer Member
that has withdrawn ceases to exist as a public agency, as
defined in Section 6500 of the California Government Coda,
then all rights, interests, and obligations of such former
Member in the Project which were derived through TAMC shall,'
at TANC's option, revert to TAMC in exchange for TANC
assuming such former Member's remaining obligations in the
Project; provided, that such former Member that has
withdrawn has not sold, assigned, or otherwise disposed of
its rights, interests, and obligations prior to the date
such Member ceases to exist as a public agency; prgvide
further, that any former Member that has withdrawn has the
right to sell, assign, or otherwise dispose of its rights,
interests, and obligations to anyone as long as the sale
does not violate the provisions of Section 6.4.
15.2.2 Former Members who have withdrawn shall have a
right of first refusal in any right or interest in the
Project (in whole or in part) which TANC or a TANC Member
determines to sell, transfer or assign to a non -Member. The
rights and obligations of former Members who have withdrawn
with respect to layoffs of Transfer Capability shall be as
prescribed in Section 7 of this Agreement;
15.2.3 Except as provided in this Section 15, a
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I withdrawal shall have no adverse effect on the rights and
2 obligations under the MOU of TAMC, its Members, and other
3 former Members who have withdrawn, as those rights and
4 obligations exist on the date of execution of this
5 Agreement;
6 15.2.4 A former Member who has withdrawn shall meet
7 its pro rata share of TANC's layoff obligations under
8 Section 7.3 of this Agreement; and
9 15.2.5 Neither the withdrawal of a Member from TAMC
10 nor the conversion of its Participation Percentage -of TANC's
11 entitlement to Transfer Capability to an undivided ownership
12 interest in the Project pursuant to Section 15.1 shall
13 relieve such Member of any of its obligations to make
14 payments with respect to Debt Service on TAMC Project
15 Indebtedness at the times and in the amounts specified in
16 Section 4.1.3.2, as though such conversion had not occurred,
17 including any amounts due thereunder as a result of an
18 increase in such Member's Participation Percentage pursuant
19 to Sections 2.3, 3.1.2.2, and 6.2. In addition, neither
20 shall such action relieve the withdrawing Member of any of
21 its obligations pursuant to Section 6.4, nor affect the
22 rights of TANC to pursue its remedies under Section 6
23 against such former Member who has withdrawn.
24 15.2.6 Prior to withdrawal and conversion pursuant to
25 this Section 15, a withdrawing Member shall execute such
26 instruments and take such actions as TANG may reasonably
27 request to protect the continuing rights of TANC in the
28interest transferred as set forth in this Agreement.
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l 15.3 Inclusion in Intertie AImplementation of
2 this Section 15 is subject to the provisions of all applicable -
3 Intertie Agreements. TAMC shall make best efforts to include in
4 all applicable Intertie Agreements, as necessary, provisions to
5 recognize and authorize the rights and obligations of TAMC and
6 Members who may elect to withdraw under this Section 15.
7 15.4 No Right to Partition - Each Member waives any rights
8 it may have to partition TANC's ownership interest in the Project
9 and agrees not to seek or to file any action in law or in equity
io to partition such interest. The Members agree that their. sole
11 right and procedure to obtain an ownership interest in the
12 Project separate and apart from TANC is pursuant to this
13 Section 15.
14 15.5 Notice - Pursuant to the provisions of Section 15.2,
15 any former Member who has withdrawn shall have the obligation to
16 notify TAMC and all other former Members who have withdrawn of
17 its intent to sell, transfer, or assign its interest in the
18 Project (in whole or in part).
19 15.6 Inclusion in Subsequent Project Agreements - Unless
20 otherwise agreed by the Members, the provisions of this
21 Section 15 shall be included in any subsequent TAMC "project
22 agreement" (as that term is defined in the Joint Powers
23 Agreement) pertaining to the subject matter hereof.
24 15.7 Adjustment of Participation Percentages - Except as
25 otherwise provided in Section 15.2.5, upon the withdrawal of a
26 Member and conversion of its Participation Percentage to an
27 undivided ownership interest pursuant to this Section 15, the
28 Participation Percentage of each remaining Member which has not
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so withdrawn and converted shall be automatically increased to
the ratio between such remaining Member's Participation
Percentage and the aggregate of the Participation Percentages of
all such remaining Members, expressed as a percentage.
16. ASSIGNMENT OF AGREEMENT
16.1 No Assignment While TAMC Project Indebtedness
Outstanding - This Agreement shall inure to the benefit of and
shall be binding upon the respective successors and assigns of
the parties to this Agreement; RKgyided, however,, that, except as
provided in Sections 4.1.3.7, 7.2.2, 7.3.2, and 15, neither this
Agreement nor any right or interest herein shall be transferred
or assigned by any party hereto so long as any TANC Project
Indebtedness is outstanding.
16.2 Assignment Prior to Withdrawal - Unless a Member has
withdrawn from TAMC pursuant to Section 15 of this Agreement, any
assignment, in whole or in part, of a Member's Participation
Percentage or individual ownership interest to a person or entity
which is not a member of TAMC is subject to paragraph 19 of the
11 joint Powers Agreement.
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17. MEMBERS' OBLIGATIONS SEVERAL
The obligation of each Member to make payments under this
Agreement is a several obligation and not a joint obligation with
those of the other Members.
18. TRUSTEE AS A THIRD PARTY BENEFICIARY
The parties agree that, among other things, this Agreement
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.s also made and entered into for the benefit of the Trustee
Ender each Indenture and the holders of outstanding TANG Project
:ndebtedness, as third -party beneficiaries, and the Trustee and
:uch holders shall have the right, as third -party beneficiaries,
:o initiate and maintain suit to enforce this Agreement to the
extent provided in any Indenture. Except as provided in this
>ection 18, no rights or benefits .shall be created in any person
�ir entity not a party to this Agreement.
19. APPENDICES
This Agreement includes Appendices A, B, C, D, and E
attached hereto and incorporated herein by this reference.
20. WAIVER
Any waiver at any time by any party of its rights with
respect to a default under this Agreement, or with respect to any
other matters arising in connection with this Agreement, shall
not be deemed a waiver with respect to any subsequent default or
other matter.
21. CAPTIONS
Except as used for definitions, all indexes, titles, subject
headings, section titles and similar items are provided for the
purpose of reference and convenience and are not intended to be
inclusive, definitive or to affect the meaning or scope of this
Agreement.
122. BILLING AND PAYMENT
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22.1 Unless otherwise agreed by the Members and TAMC, the
accounting and billing period shall be one (1) calendar month.
Monthly bills sent to a Member shall be sent by United States
mail first class, postage prepaid or its equivalent, to the
billing address specified in Appendix E. The designation of any
person specified in Appendix E may be changed at any time by
advance notice given to all Members not then in default and the
TAMC Coordinator.
22.2 Billings for amounts payable shall be due on the
twenty-fifth (25th) day after mailing of the bill. Payment shall
be made at "off ices designated by the party to which payment is
due. If the due date falls on a non -business day of either
party, then the payment shall be due on the next following
business day without interest.
22.3 Amounts of monthly billings not paid on or before the
due date shall be payable with an Interest Charge calculated from
the due date to the date of payment.
22.4 In case any portion of any monthly bill is in dispute,
the entire bill shall be paid when due. Any excess amount of
payments made pursuant to monthly billings, which through
inadvertent error or as a result of a dispute may have been
overpaid, as determined by whatever means the parties select to
resolve the dispute, shall be returned by the owing party upon
determination of the correct amount in accordance with the
Intertie Agreements. If the amount owing exceeds five hundred
dollars ($500.00) and is more than three (3) months past due, it
shall be returned with interest at the rate for an Interest
Charge less two (2) percent.
-43-
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23. DISTRIBUTION OF ASSETS
Notwithstanding anything to the contrary contained in
Section 21 of the Joint Powers Agreement, but subject in all
events to the provisions of the Intertie Agreements, in the event
the Project terminates, subject to Section 16 TAMC shall
distribute to all Members not then in default TANC's share of the
proceeds of the sale, transfer, or other disposition of any
assets acquired in connection -with the Project, and all of its
right, title, and interest therein as a Participant. Such
distribution shall be in proportion to the Participation
Percentages of such Members then in effect. No such distribution
shall occur so long as any TAMC Project Indebtedness remains
outstanding.
24. COUNTERPARTS
This Agreement may be executed in several counterparts, each
of which shall be deemed to be an original and all of which, when
taken together, shall constitute a single Agreement.
25. SIGNATURES
In witness whereof, the parties have caused this Project
Agreement No. 3 to be executed as of the date first above
written. The signatories to this Project Agreement No. 3
represent that they have been appropriately authorized to enter
into this Project Agreement No. 3 on behalf of the party for whom
they sign.
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2F
CITY OF ALAMEDA
BY:
Name:
Title:
Date:
CITY OF
HEALDSBURG
By.
Name:
Title:
Date:
_
CITY OF
LODI
BY•
Name:
Title:
Date:
CITY OF
LOMPOC
BY•
-
Name :
-_
Title:
Date:
-
MODESTO
IRRIGATION DISTRICT
By•
-
Name:
_-
-- Title:
Date:
CITY OF
PALO ALTO
BY:
Name:
Title:
Date:
CITY OF
REDDING
By•
Name:
Title:
Date:
CITY OF
ROSEVILLE
By:
Name:
Title:
Date:
-45-
SACRAMENTO.MUNICIPAL UTILITY DISTRICT
BY:
Name:
Title:
Date:
CITY OF SANTA CLARA
By:
Name:
Title:
Date: —
TURLOCK IRRIGATION DISTRICT
BY:
Name:
Title:
Date:
CITY OF UKIAH
BY.
Name:
Title:
Date:
PLUMAS-SIERRA RURAL ELECTRIC
COOPERATIVE
By:
Name:
Title:
Date:
TRANSMISSION AGENCY OF NORTHERN
CALIFORNIA
BY:
Name:
Title:
Date:
-46-
APPE WIX A
MEMORANDUM OF UNDERSTANDING
CALIFORNIA -OREGON TRANSMISSION PROJECT
This Memorandum of Understanding (MOU) is entered into as of
the 19th day of December, 1984 by (1) the CITY OF ANAHEIM
(Anaheim), CITY OF AZUSA (Azusa), CITY OF BANNING (Banning), CITY
OF COLTON (Colton), CITY OF RIVERSIDE (Riverside), and CITY OF
VERNON (Vernon) collectively referred to as "Southern California
Public Agencies"; (2) CALIFORNIA DEPARTMENT OF WATER RESOURCES
(CDWR); (3) PACIFIC GAS AND ELEGTRIC'COMPANY'(PGandE) SAN DIEGO
GAS AND ELECTRIC COMPANY (SDG&E), and SOUTHERN CALIFORNIA EDISON
COMPANY (SCE), collectively referred to as "Investor -Owned
Utilities"; (4) the WESTERN AREA POWER ADMINISTRATION (Western);
and (5) the TRANSMISSION AGENCY OF NORTHERN CALIFORNIA (Agency)
(composed of the Cities of Alameda, Biggs, Gridley, Healdsburg,
Lodi, Lompoc, Palo Alto, Redding, Roseville. Santa Clara, and
Ukiah, the Plumas-Sierra Rural Electric Cooperative, the
Sacramento Municipal Utility District, the Modesto Irrigation
District, and the Turlock irrigation District), hereinafter
sometimes referred to individually as "Participant" }.nd
collectively as "Participants", and the LOS ANGELES DEPARTMENT OF
WATER AND POWER ("LADWP"), representing itself and the Cities of
Glendale, Burbank and Pasadena, a non-voting member of the
Management Committee.
Recitals
WHEREAS, the Agency, the Investor -Owned Utilities, CIDWR and
Western, have carried out studies related to possible alternative
methods of developing additional transmission fa^_ilities between
California and the Pacific Northwest, and
WHEREAS, Public Law 98-360 and the Conference Report on
H.R. 5653 authorize the Secretary of Energy (Secretary) to
participate with non-federal entities in developing the
California -Oregon Transmission Project (Project) by Upgrading
-1-
certain facilities and authorize the Secretary to construct or
participate in the construction of jsuc'z additional facilities as
he deems necessary to allow mutually beneficial power sales
between the Pacific Northwest and California, and to accept and
use funds contributed by non-federal entities, including
investor-owned and publicly owned utilities, for that purpose,
and
WHEREAS, pursuant to the mandate set forth in the Conference
Report on H.R. 5653 and Public Law 98-360, the Secretary is
directed to enter into negotiations with all interested non-
federal entities for the financing, planning and construction of
a new 500 -kV AC line and associated facilities, and
WHEREAS, the Secretary has met with the Participants and
others and has conferred in and observed the negotiation of this
MOU by the Participants, and
WHEREAS, the Agency, the Southern California Public
Agencies, the Investor -Owned Utilities, Western and the CDWR have
all participated in the negotiations and in the development of
the Project, and
WHEREAS, the Project, when constructed, will parallel in
part the DC line between California and the Pacific Northwest,
and the operation of the Project may affect the operation of the
DC line, and for that reason, the Participants have invited
LADWP, the operator of the DC line, to be a member of the
Management Committee to the extent set forth in this MOU, and
WHEREAS, the Project has been evaluated from the technical
viewpoint and has been found to be technically feasible, and
WHEREAS, utilities in the Pacific Northwest and in
California have determined.that development of the Project will
provide mutual benefits to their respective regions, and
WHEREAS, the Participants will develop the Project
consistent with applicable environmental laws, in an expeditious
manner, and
-2-
WHEREAS, in order to develop the Project in accordance with
i- this MOU, the Participants intend to take all appropriate actions
including the negotiation and execution of a definitive
participation agreement, and other agreements as necessary,
within nine months or as soon as practicable after execution
hereof, and
WHEREAS, CDWR and the Participants have agreed to postpone
the date upon which CDWR will first be entitled to exercise its
rights to buy 6.25 percent of Project transfer capability, and
NOW THEREFORE, in order to expedite the signing of the
Participation Agreement and other necessary agreements, the
following Principles are hereby agreed to and shall be
implemented in such agreements.
1.0 Scope of Project
1.1 The Project includes:
1.1.1 The construction of a new 500 -kV AC
transmission line from the California -Oregon
border area to the Redding area.
1.1.2 Reconstruction of an existing double circuit
230 -kV AC line owned by Western to a single
circuit 500 -kV AC line from the Redding area
to the Tracy Substation.
1.1.3 Construction of a new 500 -kV AC line from
Tracy Substation to Tesla Substation.
1.1.4 Construction of a 500 -kV AC cross -tie from
the Redding area to Round Mountain Substation
or its vicinity, unless the Management
Committee determines that such cross -tie is
not needed.
1.1.5 Construction of a 500 -kV substation in the
Redding area. The size, location, and
configuration shall be as determined by the
Management Committee.
2.0 Associated Facilities
2.1 The Project does not include facilities south of the
Tesla Substation, however, PGandE shall upgrade or
improve portions of its transmission system between
Tesla Substation and Midway Substation as necessary
to provide firm power transfer capability to meet its
obligations hereunder as set forth in Sections 2.2.
2.3 and 2.4.
2.2 PGandE shall provide firm bi-directional transmission
service over its facilities between Tesla and Midway
Substations for the Southern California Public
Agencies, SCE and SDG&E in amounts equal to their
respective transfer capabilities in the Project
(whether obtained under Section 5 or Section 10) for
the life of the Project. PGandE shall also provide
up to 50 MW of firm bi-directional transmission
service between Tesla and Midway Substations for
transmission entitlement that may be assignable by
SMUD pursuant to Section 9.0. PGandE shall not be
obligated to provide firm transmission service in
excess of 700 MW for power transmitted over Project
facilities and SMUD's 50 MW of assignable
entitlement, provided. that such transmission service
shall be provided under reasonable rates, terms and
conditions.
2.3 In addition to firm transmission service provided
pursuant to Section 2.2, PGandE shall make available
to the Agency for the life of the Project up to
300 MW of firm bi-directional transmission service
between Tesla Substation and Midway (150 MW for the
M -S -R San Juan Project, plus an additional 150 MW).
The Agency shall, if requested to do so by PGandE,
provide, in the form of a contribution in aid of
construction, a reasonable and proportionate share of
the capital required for increasing the transfer
capability between Los Banos and Gates. Such
-4-
transfer capability is to be developed by PGandE and
will be available for service no later than
January 1, 1990 and shall be provided under
reasonable rates, terms and conditions.
2.4 Project Participants agree to cooperate in developing
suitable transmission facilities to deliver power
transmitted over the Project to the Participants. or
to provide acceptable firm transmission service
arrangements for such power under reasonable rates,
terms and conditions.
2.5 SCE agrees to provide firm bi-directional
transmission service between Midway Substation and.
the Southern California Public'Agetacies of power
available over the Project's facilities, consistent
with the provisions of applicable individual
integrated operating agreements and settlement
agreements between such agencies and SCE or any
successor agreements. If SCE and any such agency
cannot agree upon the terms and conditions of such a
firm transmission service agreement hereunder. SCE
will make a unilateral filing with the FERC of such a
firm transmission service agreement under Section 205
or 206 of the Federal Power Act and pursuant to the
FERC's rules and regulations promulgated thereunder.
3.0 Project Rating Interconnection and Operation
3.1 The Project shall be designed to have a minimum
transfer capability of 1600 MW including loop flow
from the California -Oregon border to the Tesla
Substation and a minimum of 1900 MW of transfer
capability from the Redding Substation to the Tracy
Substation. The actual Project transfer capability
will be determined from time to time by the
Management Committee based on studies. The
Management Committee has the right to review and
approve all modifications to the Project, provided
-5-
that any modification which materially affects the
transmission system of a Participant shall require
the prior approval of -such Participant.
3.2 The Project shall be interconnected and operated in
parallel with the existing AC Intertie facilities.
3.3 The Participants shall enter into appropriate
contractual arrangements:
3.3.1 With Northwest utilities to interconnect the
Project with the Pacific Northwest
transmission system such that access is
available to a wide spectrum of utilities in
the Pacific Northwest and Canada. Agreement
shall be among the Participants and Northwest
utilities.
3.3.2 With PGandE and Western for interconnections
between the Project and Western and PGandE
systems, including provisions governing the
ownership of new facilities in existing
substations.
3.3.3 Providing that each Participant shall have a
right to displace Northwest imports scheduled
by other Participants over the Project for
delivery and use within a control area at
times when any Participant in such control
area is in a spill condition or at minimum
generation, provided that displacement energy
is delivered to the Participant whose energy
is being displaced at a cost including
penalties, if any, at or below the price of
the displaced Northwest imports.
3.3.4 For the interconnection and parallel
operation of the Project with existing AC
Intertie facilities. Such arrangements shall
also provide for integration of the Project
with the existing AC Intertie System,
including pro rata sharing of available
am
transfer capability under outage and
curtailment conditions, including
curtailments due to loop flow.
3.4 PGandE shall be the operating agent for operation and
maintenance of the Project, with operation and
maintenance costs to be shared by Project
Participants in proportion to their respective
allocations under these Principles. PGandE shall
coordinate with Western on the operations and
maintenance on the Redding to Tracy portion of the
Project.
3.5 All Participants who receive transfer capability from
the Project shall coordinate schedules with PGandE.
4.0 Project Management
4.1 A Management Committee, chaired by a representative
of the Agency, is hereby formed to oversee and
approve the planning, design, construction, operation
and maintenance of the Project. Each Participant in
the Project shall have representation on the
Management Committee, with the members of the Agency
being represented by the Agency and the Southern
California Public Agencies being represented by one
Participant of their choice. All -actions or
decisions by the Management Committee shall be by
agreement of at least 75 percent interest of the
voting Participants, based on Project Participation
shares between the California -Oregon border area and
Tesla Substation. Subcommittees shall be formed as
needed to address specific aspects of the Project.
CDWR, prior to exercise of rights under Section 6.1,
and LADWP shall also have non-voting representation
on the Management Committee. Each Participant,
including each of the members of the Agency and each
of the Southern California Public Agencies, shall be
given advance notification of all meetings of the
Management Committee and may attend meetings.
-7-
4.2 Western shall be the lead agency for the NEPA process
and the Agency shall be the lead agency for the CEQA
process. A11"Participants agree to cooperate and
support the processes necessary to obtain all
necessary permits from regulatory agencies having
jurisdiction.
4.3 The Agency shall be the overall Project Manager.
Western, under contract to the Participants, shall be
responsible for design and construction of the
upgraded Western facilities, including the proposed
Residing Substation. The Agency and/or PGandE, under
contract to the Participants, shall be responsible
for design and construction of all Project facilities
other than Western upgraded facilities.
4.4 In exercising its non-voting representation on the
Management Committee, LADWP may represent the
ownership interests of itself, Burbank, Glendale and
Pasadena in the DC line only as to discussions
relating to operation of the DC line, and its
representation shall be limited to offering non-
binding suggestions as to planning, construction, and
operation of the Project, and advising the Committee
as to problems which may arise through operation of
the Project in parallel with the DC line.
5.0 Project Participation Shares
5.1 The Participants shall be entitled to Project
transfer capability between the California -Oregon
border area and Tesla Substation prior to January 1,
2005, in the following proportions:
5.1.1 The Agency shall be entitled to 43.75
percent.
5.1.2 The Investor -Owned Utilities shall be
entitled to 42.19 pervert.
5.1.3 The Southern California Public Agencies shall
be entitled to 7.81 percent.
we
5.1.4 Western for DOE laboratories and federal
wildlife refuges shall be entitled to 6.25
percent.
5.2 If CDWR exercises its rights and purchases its share
of the Project pursuant to Section 8.1, then the
Participants shall be entitled to Project transfer #
capability between the California -Oregon border area
and Tesla Substation commencing on January 1, 2005,
in the following proportions:
5.2.1 The Agency shall be entitled to 40.83
percent.
5.2.2 The Investor -Owned utilities shall be
entitled to 39.38 percent.
5.2.3 The Southern California Public Agencies shall
be entitled to 7.29 percent.
5.2.4 •Western for DOE laboratories and federal
wildlife refuges, shall be entitled to 6.25
percent.
5.2.5 The CDWR shall be entitled to 6.25 percent.
5.3 If CDWR elects not to exercise its rights to purchase
Project transfer capability pursuant to Section 8.1,
then the Participants shall continue to be entitled
to Project transfer capability in the same
percentages as specified in Section 5.1.
5.4 The Project transfer capability specified to Western
in Sections 5.1, 5.2, and 5.3, is to serve DOE
laboratories and federal wildlife refuges unless they
make other arrangements with Western or other
Participants. In addition, Western shall be provided
the following transfer capability in Project
facilities between the Redding Substation and Tracy
Substation:
5.4.1* 300 MW under all operating conditions, with
back up service provided by PGandE pursuant
to Contract 14-06-200-2946A (Contract 2948A).
-9-
5.4.2 Up to an r:ditional 300 MW (above 1900 MW),.
to the extent that such transfer capability
is available from the Project.
5.5 During construction of the Project, to the extent
transmission capacity is available, PGandE will
accept CVP power at any point of interconnection
between PGandE and Western for delivery to PGandE or
to Western loads served from PGandE's system pursuant
to Contract 2948A. Any incremental costs incurred by
Western because of the outage of its facilities
during construction, including wheeling charges paid
to PGandE, shall be'deemed to be a Project cost.
6.0 Project Financing Responsibility
6.1 Prior to the effective date of any election by CDWR
to exercise its rights pursuant to Section 8.1 and
unless otherwise agreed pursuant to Section 6.3, the
Participants shall be responsible for financing the
Project and betterments in the following proportions:
6.1.1 The Agency, 46.67 percent (approximately
700/1500);
6.1.2 The Investor -Owned Utilities, 45.00 percent
(approximately 675/1500);
6.1.3 The Southern California Public Agencies, 8.33
percent (approximately 125/1500).
6.2 Subsequent to the effective date of election by CDWR
to exercise its rights pursuant to Section 8.1, ane
unless otherwise agreed pursuant to Section 6.3, the
Participants shall be responsible for any capital
betterments for the Project in the following
proportions:
6.2.1 The Agency, 43.55 percent;
6.2.2 The Investor -Owned Utilities, 42.00 percent;
6.2.3 The Southern California Public Agencies,
7.78 percent;
6.2.4 CDWR, 6.67 percent.
-10-
6.3 A Participant may agree to assume (in part or whole)
financing responsibility for another Participant's
share. Such assumption shall not alter the Project
Participation shares in Section S.
7.0 Project Ownership
7.1 Except as otherwise agreed by the Participants
pursuant to Section 7.6, the Project, other than the
upgraded Western facilities, shall be owned in the
following proportions prior to January 1, 2005, and
also thereafter, if CDWR does not exercise its rights
pursuant to Section 8.1.
7.1.1 The Agency. 46.67 percent.
7.1.2 The investor -Owned Utilities. 45.00 percent.
7.1.3 The Southern California Public Agencies, 8.33
percent.
7.2 If CDWR exercises its rights to purchase Project
transfer capability pursuant to Section 8.1, then
except as otherwise agreed by the Participants
pursuant to Section 7.6, the Project (other than the
upgraded Western facilities) shall be owned in the
following proportions after January 1. 2005:
7.2.1 The Agency, 43.55 percent.
7.2.2 The investor -Owned Utilities, 42.00 percent.
7.2.3 The Southern California Public Agencies, 7.78
percent.
7.2.4 The CDWR, 6.67 percent.
7.3 Unless prohibited by law or unless otherwise agreed
pursuant to Section 7.6, the upgraded Western
facilities shall be owned in the following
proportions prior to January 1, 2005:
7.3.1 The Agency, 36.84 percent (700/1900).
7.3.2 The Investor-owned Utilities, 35.53 percent
(675/1900)_
7.3.3 The Southern California Public Agencies, 6.58
percent (125/1900).
-11-
7.3.4 Western, 21.05 percent (400/1900.).
7.4 Unless prohibited by-law or unless otherwislp agreed
pursuant to Section 7.6, the upgraded Western
facilities shall be owned in the following
proportions on and after January 1. 2005, if CDWR
exercises its rights to purchase pursuant to
Section 8.1.
7.4.1 The Agency, 34.39 percent (approximately
653/1900).
7.4.2 The Investor -Owned Utilities. 33.16 percent
(approximately 630/1900).
7.4.3 The Southern California Public Agencies, 6.14
percent (approximately 117/1900).
7.4.4 Western, 21.05 percent (400/1900).
7.4.5 CDWR, 5.26 percent (100/1900)-
7.S If CDWR elects not to exercise its rights pursuant to
Section 8.1. then the proportions owned on and after
January 1, 2005, shall be as specified in Section
7.3.
7.6 A Participant may agree to assume ownership of all or
part of another Participant's ownership share and
provide firm transmission service to such other
Participant in an amount that the Participant's
ownership share plus transmission service hereunder
shall equal the Participant's Project participation
share in Section S.
8.0 Rights for the California Department of Water Resources
8.1 Effective January 1, 2005, CDWR will have a right to
buy pro rata from all Participants, except Western.
6.25 percent of the Project as the Project exists as
of the date CDWR exercises its right. Unless another
price is mutually agreed to by the selling
Participant and CDWR, CDWR shall pay each selling
Participant the original construction cost (including
the original construction cost associated with
-12-
Western's entitlement), including the interest it,
incurred during construction, plus the original cost
of capital improvements and betterments (including
the original cost of capital improvements and
betterments associated with Western's entitlement),
including interest it incurred during construction,
allocable to the respective pro rata share of the
Project that the Participant is selling to CDWR.
Within one year after the Project is energised, each
Participant shall provide CDWR with a statement of
the original construction cost (including the
original construction cost associated with Western's
entitlement), including the interest it incurred
during construction for its share of the Project so
that CDWR can determine the cost it shall be
obligated to pay such Participant if it exercises its
rights under this Section 8.1. Within one year after
any capital improvements or betterments are completed
prior to the date of exercise by CDWR, each
Participant shall provide CDWR with a statement of
construction costs incurred for such capital
improvements, or betterments (including the o.•.iginal
construction cost of capital improveslents and
betterments associated with Western's entitlement)
including interest it incurred during construction
with respect to its share, so that CDWR can determine
the cost it shall be obligated to pay such
Participant if it exercises its rights under this
Section 8.1.
8.2 Subject to (1) satisfaction of Section 11.4 of this
MOU as to participation of PGandE in the Project, (2)
execution by CDWR of the participation agreement, and
(3) construction of the Project, the term of the
Extra High Voltage Contract, dated August 1, 1967,
among CDWR, PGandE, SDG&E, and SCE, or the
successor(s) in interest to SDG&E and SCE, shall be
-13-
extended for the useful life of the existing AC
Intertie. Notwithstanding any terms to the contrary
in the Extra High Voltage Contract, if the Parties
cannot reach agreement on the rates that CDWR is to
pay during the extended term of this contract, after
2004 PGandE, SCE, and SDG&E, or the successor(s) in
interest to SDG&E and SCE, may unilaterally make
application to FERC for a change in rates, under
Section 205 of the Federal Power Act and pursuant to
the FERC's Rules and Regulations promulgated
thereunder.
8.2.1 CDWR shall be considered a Participant for
the purposes of Sections 3.3.3 and 10.4.
8.3 Upon exercise of CDWR's rights under Section 8.1,
PGandE and SCE shall provide firm transmission
capacity to deliver CDWR's 100 MW to Midway and
Vincent Substations, under reasonable rates, terms,
and conditions.
8.4 Except as provided in Section 8.2, nothing in this
agreement shall modify or change CDWR's rights under
the Extra High Voltage Agreement dated August 1,
1967.
9.0 The EHV Contract Between SMUD, PGandE, SCE, and SDG&E
9.1 PGandE, SCE, and SDG&E, pursuant to Article 33 of the
August 1, 1967 contract entitled "Contract Between
California Companies and Sacramento Municipal Utility
District for Extra High Voltage Transmission and
Exchange Service" between SMUD, PGandE, SCE, and
SDG&E (EHV Contract), consent to an assignment by
SMUD of up to 50 MW of SMUD's 200 MW entitlement
pursuant to the EHV Contract to California publicly
owned utilities on such terms as may be negotiated
between SMUD and the California publicly owned
utilities; provided, however that such terms shall be -
consistent with, shall not amend, and shall not
r
interfere with the performance of any rights or
obligations under the ZHV Contract.. Such assignment
may commence on January 1, 1985 and shall terminate
on the earliest to occur of, (1) the date when the
California-0regon Transmission Project becomes
operational, (2) the date when the participation of
PGandE, SCE, and SDG&E is terminated because the
approvals under Section 11.4 cannot be obtained or
because those approvals are. unsatisfactory to PGandE,
SCE, and SDG&E, (3) the date when the Project is
terminated prior to its operation, such termination
t
to be deemed to have occurred on January 1, 1993, if
no work has been done on the Project for three years
prior to that date. Such an assignment shall not
impair SMUD's right to utilize ^ny assigned
entitlement after termination of the assignment.
10.4 Layoff Arrangements
10.1 The Agency shall lay off on a firm basis 50 MW of
Project transfer capability to the Southern.
California Public Agencies between 1990 and 1994.
The Agency shall lay off on a firm basis 25 MW of
Project transfer capability to the Southern
California Public Agencies between 1995 and 1999.
10.2 The Agency shall lay off on a firm basis Project
transfer capability to the Investor -Owned Utilities,
as indicated below:
1990: 200 MW
1991: 175 MW
1992: 150 MW
1993: 125 MW
1994: 100 MW
1995: 75 MW
1996: 50 MW
1997: 25 MW
1998 and thereafter: 0 MW
-15-
10.3
10.4
r
Layoff of Project transfer capability pursuant to
Sections 10.1 and 10.2 shall be sold at the cost of
said transfer capability based on public financing
plus contingencies of 25 percent. It is recognized
that the layoff amounts set forth in Sections 10.1
and 10.2 will be converted to a percentage of the
minimum design transfer capability of 1600 MW and
applied to the actual transfer capability determined
by the Management Committee.
An important goal of the Project is to benefit the
Participants and their respective ratepayers,
commensurate with the risks inherent in the
Project. To the extent that any Participant does not
need its Project transfer capability to meet the
loads of its system (directly or by exchange) and its
firm layoff requirement pursuant to Sections 10.1 and
10.2 hereunder, such remaining transfer capability
shall be made available to the other Participants.
10.4.1 Long-term transfer capability is transfer
capability for which a five-year advance
notice is required. Short-term transfer
capability is transfer capability for which
less than five years notice is required.
10.4.2 Layoff transfer capability as specified in
Section 10.4 shall be made available on a
cost basis. Long-term transfer capability
shall be offered at no less than the cost of
transfer capability based on public financing
plus contingencies of 25 percent. Short-term
transfer capability shall be offered at no
less than the cost of transfer capability
based on public financing with no continyency
adder.
10.4.3 If there are no Participants wishing to
purchase either long-term or short-term
-16-
layoff at the applicable price pursuant to
Section 10.4.2, then the selling Participant
can use its excess transfer capability to
deliver power to a Participant or to other
entities under any terms and conditions or
make its Project transfer capability
available to others.
10.5 Nothing in Section 10.4 shall prevent any Participant
from utilizing its Project transfer capability to
transmit power to other Participants or entities in
the Northwest.
11.0 Approval by the Secretary of Energy, Congress and other
Governmental Agencies
if, after a public notice procedure and due deliberation by
the Secretary, this MOU is adopted by the Secretary as the
basis for development of the Project, the Participants
agree as follows:
11.1 This MOU shall be submitted by the Secretary in his
report to Congress, pursuant to Public Law 98-360.
11.2 The Participants shall support,the passage of
legislation in the form attached hereto as
"Exhibit A", authorizing the implementation of the
Project in accordance with this MOU. The
Participants shall also support report language
accompanying such legislation in the form attached as
"Exhibit B", which determines that the plan for
development and operation of the Project in
accordance with this MOU is in the public interest.
11.3 Contracts among the Participants shall then be
negotiated to implement these principles. As a
condition of execution of any contracts implementing
this MOU each Participant shall furnish the other
Participants with a written Opinion of Counsel in
which it is represented that said Participant has the
authority to enter into such contracts and to be
-17-
bound by the terms and conditions thereof. In the
case of Agency, each major member agency thereof
shall furnish such Opinion of Counsel.
11.4 The contracts negotiated to implement these
Principles shall be submitted to, and shall be
subject to satisfactory approvals and permits of,
local, state and federal governmental agencies having
jurisdiction over the Participants to the contracts
or the actions contemplated here.
11.5 If the conditions in Section 11.4 are not satisfied
as to my Participant, without changes or new
conditions unacceptable to such Participant, such
Participant shall no longer be bound by any provision
of this MOU.
12.0 Signature Clause
The signatories to this MOU represent that they have been
appropriately authorized to enter into this HOU on behalf
of the Party for whom they sign. This MOU may be executed
in counterparts. This MOU is executed as of the 19th day
of December, 1984.
(Seal)
i
aI -AhemCoinsel to C—Dated:
CITY OF ANAHEIM
By:
Date:
CITY OF AZUSA
By:
Date:
-18-
bound by the terms and conditions thereof. In the
case of Agency, each major member agency thereof
shall furnish such Opinion of Counsel.
11.4 The contracts negotiated to implement these
Principles shall be submitted to, and shall be
subject to satisfactory approvals and permits of,
local, state and federal governmental agencies having
jurisdiction over the Participants to the contracts
or the actions contemplated here.
11.5 If the conditions in Section 11.4 are not satisfied
as to any Participant., without changes or,new
conditions unacceptable to such Participant, such
Participant shall no longer be bound by any provision
of this MOU.
12.0 Signature Clause
The signatories to this HOU represent that they have been
appropriately authorised to enter into this MOU on behalf
of the Party for whom they sign. This MOU may be executed
in counterparts. This MOU is executed as of the 19th day
of December, 1984.
CITY OF ANAHEIM
By:_
Date:
CITY OF AZUSA
By:
pop V.
Date: 18 1984
-18-
CITY of BANNING
.or
•
By: t
Dates 1ve
CITY OF COLTVK
SY=
Dates
CITY OF RIVERSIDE
t;
By:
Dates
CITY OF VE
Sys
Dates
CALI FOYSIA DEPART -4M OF
WATER USOURCES
By=
Date:
PACIFIC GAS Mm ELECTRIC COMPANY
By:_
Date:
-19-
CAGIVOWU OMPAR'SINNIT OF
W&TZR
BY=
Date
PACIFIC GAB AND ZLVCCMC COMPAXT
bys
Date:
—19—
CITY OF BANNING
BY%
Date:
CITY OF COLTON
By:
Date:
CITY OF RIVERSIDE
By:
Date: '
CITY OF VERNON
By:
Date:
CALIFORNIA DEPARTMENT OF
WATER RESOURCES
By:
Date:
PACIFIC GAS AND ELECTRIC COMPANY
By:
Date:
-19-
CITY OF ®AMING
By $ ....
Dates
Lppro-wed as to legal Zorn
sad Wficienc8a_
hy!' Cou s rar
or Water Regio cog
CITY OF BANNING
By:
Date:
CITY OF COLTON
By:
Date:
CITY OF RIVERSIDE
By:
Date:
CITY Or VEM14ON
BY:
Dale:
CALIFORNIA DEPARTMENT OF
) WATER RESOURCES
Date: r2 14 104 —
PACIFIC GAS AND ELECTRIC COMrANY
By:
Date: _
-19-
CALIFORNIA DEPARTMENT OF
WATER RESOURCES
By:
Date:
PACIFIC GAS AND ELECTRIC COMPANY
By:
Date: December 18, 1984 '
�}
-19-
SAN DIEGO GAS AND ELECTRIC COMPANY
Sys
Date: P&ceµb*r (r, f.TP4
SOUTHERN CALIFORNIA EDISON COMPANY
By:
Date:
WESTERN AREA POWER ADMINISTRkTION
By:
Date:
TRANSMISSION AGENCY OF
NORTHERN CALIFORNIA
By:
Dates
LOS ANGELES DEPARTMENT OF
WATER AND POWER
By:_
Date:
SAN DIEGO GAS AND ELECTRIC COMPANY
By:
Date:
SOUTHERN RN E ISON COM
By: •
Date: 2
WESTERN AREA POWER ADMINISTRATION
By:
Date:
TRANSMISSION AGENCY OF
NORTHERN CALIFORNIA
By:
Date:
LOS ANGELES DEPARTMENT OF
WATER AND POWER
By:
Date:
-20-
r
SAN DIEGO GAS AND ELECTRIC COMPANY
By.
Date:
SOUTHERN CALIFORNIA EDISON COMPANY
By:
Date:
WESTERN AREA POWER ADMINISTRATION
Date:
*/ Subject to a public involvement proceeding
and, after consideration of public comments,
adoption of this MOU, as may be modified
based on such public comments, by the
Secretary of Energy.
TRANSMISSION AGENCY OF NORTHERN CALIFORNIA
By: _
Date:
LOS ANGELES DEPARTMENT OF WATER AND POWER
By:
Date•
-20-
SAN DIEGO GAS AND ELECTRIC COMPANY
By:
Date:
SOUTHERN CALIFORNIA EDISON COMPANY
By:
Date:
WESTERN AREA POWER ADMINISTRATION
By:
Date:
TRANSMISSION AGENCY OF
NORTHERN CALIFORNIA
Date: oz&z
LOS ANGELES DEPARTMENT OF
WATER AND POWER
By:
Date:
SAI3 DIEnO GAS AND ELECTRIC COMPANY
By:
Date:
SOUTHERN CALIFORNIA EDISOU COMPANY
By:
Date:
WESTERN AREA POWER ADMINISTRATION
By:
Date:
TRANSMISSION AGENCY OF
NORTHERN CALIFORNIA
By:
Date:
DEPARTMENT OF MATER AI4D POKER
OF THE CITY OF LOS ANGELES
?ROVE ' AS i►7 f 0?, M . i.EGALIIYc'
By
ON ATi?R11EY
i•J
BOARD OF WATER AND POWER COMMISSIONERS C)
I
OF THE TY OF L
B
.. S NGELES r�
; .� ! �ti
...1.......
4��-.- .-. and
!r' ^ G, :a- WESSON
_.:wrC •.:.rne, ecretary
(nn
z �
coo G-
-z0-
"Exhibit A"
Suggested Legislation
The Secretary of Energy is authorized -to cause the
construction of a third AC transmission line from the Pacific
Northwest to California in accordance with a Memorandum of
Understanding submitted by the Secretary pursuant to Public
Law 98-360.
"Exhibit 8"
ested Report Language in Appropriations
its ation in BoEn or Conference
The Secretary has, pursuant to Public Law 98-360, reported a
conceptual plan for construction of the line, which is described
in detail in a Memorandum of Understanding signed by most of the
privately and publicly owned utilities in California. The plan
for development and operation of the new 500 -kV AC line and
.associated facilities described in the Memorandum is in the
public interest and will benefit the electric consumers of•the
Pacific Northwest and Southwest. Accordingly, the Secretary is
instructed to work with the California utilities and proceed with
development and operation of the Project in accordance with the
Memorandum.
APPF. MIX B
Ell
ChLIFORMIA-OREGON
TRANSMISSION PROJECT
NMORANDUM OF i., UNDBRS MMIM
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r
CONPORMED COPY
CALIFORNIA-OP.EGON TRANSMISSION PROJECT f
MEMORANDUM OF UNDERSTANDING ANNEX
Among
City of Anaheim
City of Azusa
City of Banning
City of Colton
City of Riverside
City of Vernon
California Department of Water Resources
Los Angeles Department of Water and Power
Pacific Gas and Electric Company
San Diego Gas & Electric Company
Southern California Edison Company
Transmission Agency of Northern California
Western Area Power Administration
Carmichael Water District
E1 Dorado Sills Community Services District
San Juan Suburban Water District
Shasta Dam Area Public Utility District
Southern San Joaquin Valley Power Authority
Trinity County Public Utility District
March 19, 1986
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231
TABLE OF CONTENTS
ISECTION PAGE
—i—
RECITALS.............................................
2
1.
DEFINITIONS AND CATEGORIES OF PARTICIPANTS............
3
2.
ASSUMPTION OF OBLIGATIONS AND RIGHTS .................
4
3.
i'
PROJECT ANAGEriE+.......00.o...o...o..00......o...o.
5
4.
MEMORANDUM OF UNDERSTANDING --PROJECT PARTICIPATION
8HARES . o o r a ......... w .. • • ........... • . • .... • . • .. • • •
6
S.
KEMORlkNDUM OF UNDERSTANDING --PROJECT FINANCING
RESPONSIBILITY .....................................
9
6.
MEMORANDUM OF UNDERSTANDING --PROJECT OWNERSHIP.......
10
7.
RIGHTS OF THE CALIFORNIA DEPARTMENT OF WATER
RESOURCES.....000......o......00.....00000.00...o..
15
S.
PROJECT DE47ELOPXENT AGREEMENT --PROJECT OWNERSHIP,
ENTITLEMENT TO TRANSFER CAPABILITY OF THE PROJECT
AND PROJECT FINANCING RESPONSIBILITY ...............
18
9.
CHANGES IN OWNERSHIP, PARTICIPATION SHARE, AND
FINANCING RESPONSIBILITY ...........................
20
10.
REIMBURSEMENT OF CURRENT PARTICIPANTS ................
20
11.
CONSTRUCTIVE WITHDRAWAL ...............................
22
12.
ASSIGNMENT............o.o.......o....... oo...........
25
13.
OPINIONS OF COUNSEL........... ......................
27
14.
SIGNATURE CLAUSE .....................................
23
—i—
E
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9
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11
12
r -
MEMORANDUM OF UNDERSTANDING ANNMC
CALIFORNIA -OREGON TRANSMISSION PROJECT
This Memorandum of Understanding Annex ("HOU Annex") shall
effective as of February 22, 1986, and is entered into by the
ty of Anaheim (Anaheim), City of Azusa (Azusa), City of Banning
((Banning), City of Colton (Colton), City of Riverside
(Riverside), City of Vernon (Vernon), collectively referred to as
"Southern California Public Agencies"; California Department of
Water Resources (CD61R); Pacific•Gas and Electric Company
(PGandE), San Diego Gas and Electric Company (SDG&E), and
California Edison Company (SCE), collectively referred
1311to as "Investor -Owned Utilities"; the Western Area Power
14 IlAdministration (Western); the Transmission Agency of Northern
15 California (Agency), a joint powers agency composed of the Cities
16 of Alameda, Biggs, Gridley, Healdsburg, Lodi, Lompoc, Palo Alto,
17 Redding, Roseville, Santa Clara, and Ukiah, the Plumaa-Sierra
18 Rural Electric Cooperative, the Sacramento Municipal Utility
1911District, the Modesto Irrigation District, and the Turlock
20 Irrigation District; hereinafter sometimes referred to
21 individually as "Current Participant" and collectively as
22 "Current Participants"; the Los Angeles Department of Water and
23 Power (LADWP), representing itself and the Cities of Glendale,
24 Burbank, and Pasadena, a non-voting member of the Management
25 Committee; and Southern San Joaquin Valley Power Authority (South
26 San Joaquin), a joint powers agency; Trinity County Public
27 Utility District (Trinity); Shasta Dam Area Public Utility
28 District (Shasta); San Juan Suburban Water District (San Juan);
-1-
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3
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5
6
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i
9
10
11
12
13
14
15
16
17
18
El Dorado Hills Community Services District (El Dorado); ani
Carmichael Water District (Carmichael), hereinafter sometimes
referred to individually as "Additional Participant" and
collectively as "Additional Participants."
{RECITALS
WHEREAS, the Current Participants, along with LADWP, have
executed the Memorandum of Understanding, California -Oregon
Transmission Project dated December 19, 1984 ("MOU"), and the
Current Participants, except for CDWR, have executed a
Supplemental Letter Agreement to the MOU, the Interim Cost
Sharing Agreement effective April 1. 1985, and the Project
Development Agreement ("PDA") effective September 30, 1985, for
the purpose of developing the California -Oregon Transmission
Project ("Project"), and
WHEREAS, the Secretary of Energy, by his Memorandum of
,Decision ("MOD") of February 7, 1985 approved the MOU subject to
i
the modifications and conditions set forth in the MOD, which MOD
IIhas been clarified by the May 4, 1985 letter from the Acting
f
201 General Counsel of thea Department of Energy# and
22
23
24
25
26
27
28
WHEREAS, certain non-federal public entities were, under
terms and conditions specified by Western in 50 Fed. Reg.
31912 (1985), allocated entitlements within the 3.125 per cent of
Project transfer capability reserved to them by the Secretary of
Energy, which non-federal public entities and their allocated
entitlements are set out at 50 Fed. Reg. 42769 (1985), and
WHEREAS, such non-federal public entities, designated as
Ithe Additional Participants, as one condition of receiving and
-2-
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2
3
4
5
6
7
8
9
10
11
12
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14
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using such entitlement must sign an agreement with the Current
Participants by which they assume all appropriate obligations and
become entitled to all applicable rights and benefits of the
Project defined to date,
NOW, THEREFORE, the Additional Participants, the Currant
Participants, and LAW agree as followss
11.
DEFINITIONS AND.CATEGORIES OF PARTICIPANTS
1.1 For purposes of this MOU'Annex, a "Participant" is
an entity having the obligations, rights and
benefits of a Participant as that term is used in
the MOU, the Supplemental Letter Agreement, the
Interim Cost Sharing Agreement, the PITA and any
other agreement. elated to the Projact which has
been signed by all or substantially all the
Current Participants and Additional Participants.
1.2 A Monutility Participant is any Additional
Participant which (1) is not a public electric
utility regulated under applicable state law or
the Federal Power Act or exempted from such
regulation by reason of being a public entity, or
(2) does not have public utility responsibilities
with regard to serving electric power to
customers. Nonutility Participants have the same
rights, obligations and benefits as participants
except as provided in Section 2.2 below. As of
the effective date of this Agreement, the
Nonutility Participants are South San Joaquin, San
-3-
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3
4
5
6
7
8
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12
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14
15
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24
25'
26
27
28
Juan and Carmichael. Doming contained herein
shall preclude a Nonutility Participant from
changing its status at a later date, to no longer
be a Nonutility Participant.
2. ASSUMPTION_OF OBLIGATIONS AND RIGHTS
2.1 Each Additional Participant agrees to and is bound
hereby by all provisions, terms and conditions of
the HOU as modified by the MOD of the United
States Secretary of Energy, dated February 7,
1985, as interpreted by the letter of the United
States Department of Energy Acting General
Counsel, dated May 4, 1985# and as such MOU may be
further amended, the Supplemental Letter
Agreement, the Interim Cost Sharing Agreement and
the PDA, all as modified by this MOU Annex, as if
each Additional Participant had duly executed such
agreement.
2.2 In accordance with the May 4, 1985 letter from the
Acting General Counsel of the Department of
Energy, which provides in part that the Secretary
of Energy's MOD was not intended to impose a
precedent for wheeling to end-users, Section 2.4
of the MOU and Sections 34.3 and 34.4 of the PDA,
which implement Section 2.4 of the MOU, shall not
be applicable to Nonutility Participants.
Section 10.5 of the MOU shall not be applicable to
any Nonutility Participant.
-4-
0
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3
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3. PROJECT MANAGEMENT
The following is substituted for and replaces Section 4.1
Df the MOU:
"4.1 A Management Committee, chaired by a
representative of the Agency, is ?hereby formed to
oversee and approve the planning, design,
construction, operation and maintenance of the
Project. Each Participant in ilio Project shall
have representation on -the Management Committee.
with the members of the Agency being represented,
by the Agency, and the Southern California Pub2jc.
Agencies being represented by one Participant of
their choice, and each Additional Participant
being jointly represented by one Additional
Participant, provided that any Additional
Participant may designate instead a Current
Participant's Management Committee Representative
to represent it on the Management Committee. All
actions or decisions by the Management Committee
shall be by agreement of at least 75 percent
Interest of the Participants entitled to vote
based on Project Participation shares between the
California -Oregon border area and Tesla
Substation, as expressed in Section 5. A
Management Committee Representative who represents
more than one Participant shall separately vote
the interests of each Participant represented.
Subcommittees shall be formed as needed to address
-5-
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specific aspects of the Project. CDWR, prior to
exercise of rights under Section 8.1, and LADWP
shall also have non-voting representation on the
Management Committee. Each Participant, including
each of the Southern California Public Agencies
and each of the Additional Participants, and each
of the members of the Agency, shall be given
advar.e notification of all meetings of the
Management Committee and may attend meetings."
4. MEMORANDUM OF UNDERSTANDING --PROJECT PARTICIPATION SHARES
4.1 The following is substituted for ani replaces
Section 5.1 of the M1Ua
05.1 The Participants shall be entitled to
Project transfer capability between the
California -Oregon border area and Tesla
Substation prior to January 1. 2005, in
the following proportions%
5.1.1 The Agency shall be entitled
to 42.2916 percent=
5.1.2.. The Investor -Owned Utilities
shall be entitled to 40.7837
percents
5.1.3 The Southern California Public
Agencies shall be entitled to
7.5497 percent;
5.1.4 Western for DOE laboratories
-6-
and federal wildlife refuges
I shall be entitled to 6.2500
2 percent;
3 5.1.5 South San Joaquin shall be.
4 entitled to 2.0625 percent;
5 5.1.6 Trinity shall be entitled to
6 .3125 percent;
7 5.1.7 Shasta shall be entitled to
8 .4375 percents
9 5.1.8 San Juan shall be entitled to
10 .0625 percents
11 5.1.9 El Dorado shall be entitled to
12 .1875 percent;
13 5.1.10 Carmichael .0625 percent."
14 4.2 The following is substituted for and replaces
15 Section 5.2 of the MOUS
16 05.2 If CDWR exercises its rights and
17 purchases its share of the Project in
18 accordance with Section 8.1 of the MOU,
19 then the Participants shall be entitled
20 to Project transfer capability between
21 the California -Oregon border area and
22 Tesla Substation commencing on
23 January 1, 2005, in the following
24 proportions:
25 5.2.1 The Agency shall be entitled
26 to 39.4690 percent;
27
28
-7-
5.2.2
The Investor -Owned Utilities
1
shall be entitled to 38.0673
2
3
percents
5.2.3
The Southern Californi#A Public
4
Agencies shall be entitled to
5
6
7.0470 percent=
7
5.2.4
Western for DOE laboratories
8
and federal wildlife refuges
9
shall be entitled to 6.2500
10
percents
11
5.2.5
South San Joaquin shall be
12
entitled to 2.0625 percents
13
5.2.6
Trinity shall be entitled to
14
.3125 percent;
15
5.2.7
Shasta shall be entitled to
16
.4375 percents
Y7
5.2.8
San Juan shall be entitled to
18
.0625 percents
19
5.2.9
E1 Dorado shall be entitled to
20
.1875 percent;
21
5.2.10
Carmichael shall be entitled
22
to .0625 percent;
23
5.2.11
The CDWR shall be entitled to
24
6.0417 percent."
25
26
27
28
-8-
1 5. MEMORANDUM OF UNDERSTANDING --PROJECT FINANCING
2 RESPONSIBILITY
3 S.1 The.following is substituted for and replaces
4 Section 6.1 of the MOU:
5 "6.1 Prior to the effective date of any
6 election by CDWR to exercise its rights
7 in accordance with Section 8.1 of the
8 MOU and unless otherwise agreed in
9 accordance with Section 6.3 of the MOU,
10 the Participants, shall be responsible
11 for financing the Project and
12 betterments in the following
!3 proportionsa
14 6.1.1 The Agency, 45.1110 percent;
15 6.1.2 The Investor -Owned Utilities,
16 43.5026 percent;
17 6.1.3 The Southern California Public
18 Agencies, 8.0530 percent;
19 6.1.4 South San Joaquin, 2.2000
20 percents
21_ 6.1.5 Trinity, .3333 percent;
22 6.1.6 Shasta, .4667 percent;
23 6.1.7 San Juan, .0667 percent;
24 6.1.8 El Dorado, .2000 percent;
25 6.1.9 Carmichael, .0667 percent."
26 5.2 The following is substituted for and replaces
27 Section 6.2 of the MOU:
4-?
-9-
1 "6.2 Subsequent to the effective date of
2 election by CDWR to exercise its rights
3 in accordance with Section 8.1 of the
4 MOU, and unless otherwise agreed in
5 accordance wigs Section 6.3 of the MOU,
6 the Participants, shall be responsible
7 for any capital betterments for the
8 Project in the following proportions:
9 6.2.1 The Agency, 42.1002 percents
10 6.2.2 The Investor -Owned "Utilities,
D1 40.6052 percent=
12 6.2.3 The Southern California Public
13 Agencies, 7.5168 percents
14 6.2.4 The CDWR, 6.4444 percents
15 6.2.5 South San Joaquin, 2.2000
16 percents
17 6.2.6 Trinity, .3333 percents
18 6.2.7 pasta, .4667 percentr
19 6.2.8 San Juan, .0667 percent:
20 6.2.9 E1 Dorado, .2000 percents
21 6.2.10 Carmichael, .0667 percent."
22
23 b. MEMORANDUM OF UNDERSTANDING --PROJECT O'4NERSHIP
24 6.1 The following is substituted for and repla-ces
25 Section 7.1 of the MOU:
26 "7.1 Except as otherwise agreed by the
27 Participants in accordance with
28 Section 7.6 of the MOU, the Project,
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other than the upgraded Western
facilities, shall be owned in the
following proportions prior to
January 1, 2005, and also thereafter,
if CDWR does not exercise its right in
accordance with Section 8.1 of the MOU:
7.1.1 The Agency, 45.1110 percent;
7.1.2 The Investor -Owned Utilities,
43.5026 percent;
7.1.3 The Southern California Public
Agencies, 6.0530 percent;
7.1.4 South San Joaquin, 2.2000
percent;
7.1.5 Trinity, .3333 percent;
7.1.6 Shasta, .4667 percent;
7.1.7 San Juan, .0667 percent;
7.1.8 E1 Dorado, .2000 percent;
7.1.9 Carmichael, .0667 percent."
6.2 The following is substituted for and replaces
Section 7.2 of the MOU:
"7.2 if cDwR exercises its rights to
purchase Project transfer capability in
accordance with Section 8.1 of the MOU,
then except as otherwise agreed by the
Participants in accordance with
Section 7.6 of the MOU, the Project,
other than the upgraded Western
facilities, shall be owned in the
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9
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11
12
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15
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6.3
following proportions after January 1,
2005:
7.2.1 The Agency, 42.1002 percent;
7.2.2 The Investor -Owned Utilities,
40.6052 percents
7.2.3 The Southern California Public
Agencies, 7.5168 percent;
7.2.4 The CDWR, 6.4444 percent;
7.2.5 South San Joaquin, 2.2000
percents
7.2.6 Trinity. .3333 percent;
7.2.7 Shasta, .4667 percents
7.2.8 San Juan. .0667 percents
7.2.9 E1 Dorado, .2000 percent;
7.2.10 Carmichael. .0667 percent."
The following is substituted for and replaces
Section 7.3 of the MOU:
07.3 Unless prohibited by law or unless
otherwise agreed in accordance with
Section 7.6 of the MOU, the portion of
the upgraded Western facilities not
owned by Western shall be owned in the
following proportions prior to
January 1, 2005:
7.3.1 The Agency, 45.1110 percent,
(approximately 677/150014;
-12-
-13-
7.3.2 The Investor -Owned Utilities,
1
43.5026 percent,
2
(approximately 652/1500);
3
7.3.3 The Southern California Public
4
5
Agencies, 8.0530 percent
(approximately 121/1500);
6
7
7.3.4 South San Joaquin. 2.200
8
percent (approximately
33/1500)=
9
10
7.3.5 Trinity, .3333 percent
(approximately 5/1500);
11
12
7.3.6 Shasta, .4667 percent
13
(approximately 7/1500);
14
7.3.7 San Juan, .0667 percent
15
(approximately 1/1500);
16
- 7.3.8 El Dorado, .2000 percent
17
(approximately 3/1500):
18
7.3.9 Carmichael. .0667 percent
19
(approximately 1/1500).
20
The Participants recognize that the
21
facilities to be owned by Western shall
22
be determined in accordance with the
23
provisions of the MOU, approved by the
24
Secretary of Energy by the MOD, which
25
MOD was clarified by the May 4. 1985
26
letter from the Acting General Counsel
27
of the Department of Enemy. Further
28
negotiations of the particulars of the
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6
7
8
9
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ownership of facilities by Western will
be required as engineering of the
Project progresses."
6.4 The following is substituted for and replaces
Section 7.4 of the HOU:
"7.4 Unless prohibited by law or unless
otherwise agreed in accordance with
Section 7.6 of the HOU, the portion of
the upgraded Western facilities not
owned by Western shall'be•owned in the
following proportions on and after
January 1, 2005, if CDWR exercises its
rights to purchase in accordance with
Section 8.1 of the HOU:
7.4.1 The Agency, 42.1002 percent
(approximately 631/1500);
7.4.2 The Investor -Owned Utilities,
40.6052 percent (approximately
609/1500)=
7.4.3 The Southern California Public
Agencies, 7.5168 _percent
(approximately 113/1500);
7.4.4 The CDWR, 6.4444 percent
(approximately 97/1500);
7.4.5 South San Joaquin, 2.200
percent (approximately
33/1500);
-14-
1 7.4.6 Trinity, .3333 percent
2 (approximately 5/1500);
3 7.4.7 Shasta, .4667 percent
4 (approximately 7/1500);
5 7.4.8 San Juan, .0667 percent
6 (approximately I/1500);
7 7.4.9 E1 Dorado, .2000 percent
8 (approximately 3/1500);
9 7.4.10 Carmichael, .0667 percent
10 (approximately 1/1500).
11 The Participants recognize that the
12 facilities to be owned by Western shall
13 be determined in accordance with the
D4 provisions of the MOU, approved by the
15 Secretary of Energy by the MOD, which
16 MOD was clarified by the May 4, 1985
17 letter from the Acting General'Counsel
18 of the Department of Energy. Further
19 negotiation of the particulars of the
20 ownership of facilities by Western will
21 be required as engineering of the
22 Project progresses."
23
24 7. RIGHTS OF THE CALIFORNIA DEPARTMENT OF WATER RESOURCES
25 7.1 The following is substituted for and replaces
26 Section 8.1 of the MOU:
27 "8.1 Effective January 1, 2005, CDWR will
28 have a right to buy pro rata from all
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7
8
9,
10
11
12
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18
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22
?3
24
25
26
27
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Current Participants, except Western,
6.25 percent, as such percentage is
adjusted downward to accommodate the
allocation to Additional Participants,
of the Project as the Project exists as
of the date CDWR exercises its right.
Unless another price is mutually agreed
to by the selling -Current Participant
and CDWR, CDWR shall pay each selling
Current Participant the original
construction cost (including the
original construction cost associated
with Western's entitlement), including
the interest it incurred during
construction, plus the original cost of,
capital improvements and betterments
(including the original cost of capital
improvements and betterments associated
with Western's entitlement), including
interest it incurred during
construction, allocable to the
respective pro rata share of the
Project that the Current Participant
is selling to CDWR. Within one year
after the Project is energised, each
Current Participant shall provide CDWR
with a statement of the original
construction cost (including the
-16-
original construction cost associated
I
with Western's entitlement), including
2
the interest it incurred during
3
construction for its share of the
4
Project so that CDWR can determine the
5
cost it shall be obligated to pay such
6
Current Participant if it exercises its
7
rights under this Section 8.1. Within
$
one year after any'capital.improvements"
9
10
or betterments are completed prior to
the date of exercise by CDWR, each
11
Current Participant shall provide CDWR
12
13
with a statement of construction costs
incurred for such capital improvements,
14
15
or betterments (including the original
16
construction cost of capital
D7
improvements and betterments associated
18
with Western's entitlement) including
19
interest incurred during construction
20
with respect to its share, so that CDWR
21
can determine the cost it shall be
22
obligated to pay such Current
23
Participant if it exercises its rights
24
under this Section 8.1"
25
26
27
28
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7
8
9
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25
26
27
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8. PROJECT DEVELOPMENT AGREEMENT --PROJECT_ OWNERSHIP,
ENTITLEMENT TO TRANSFER CAPABILITY OF THE PROJECT AND
PROJECT FINANCING RESPONSIBILITY
8.1 The following is substituted for and replaces
Appendix F of the PDAs
"Appendix F
Project Ownership and Entitlements
(Expressed in Percentages)
Entitlement to
Transfer Capability Ownership
of the ProJectl/ Interest2/
e ,
IANC 42.2916 45.1110
PGandE
20.3918
21.7S13
SDG&E
2.8S49
3.0452
SCE
17.5370
18.7061
Anaheim
3.0196
3.2212
Azusa
0.3020
0.3221
Banning
0.1510
0.1611
Colton
0:3020
0.3221
Riverside
2.0762
2.2146
Vernon
1.6987
1.8119
Western
6.2500
0.0000
South San Joaquin
2.0625
2.2000
Trinity
0.3125
0.3333
Shasta
0.4375
0.4667
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7
8
9
10
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12
13
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17
18
19
20
22
23
24
25
26
27
28
San Juan
E1 Dorado
Carmichael
0.0625
0.1875
0.0625
100.0000
0.0667
0.2000
0.0667
100.0000
D2Between California -Oregon border area and Tesla Substation
2 Excluding facilities owned by Western"
8.2 The following is substituted for and replaces
Section 5.1 of the PDAs
"5.1 Unless the following percentages are
otherwise modified in accordance with
Section 3.4 each Participant shall be
responsible for paying its share of the
costs of Project Development Work in
the following Cost Sharing Percentages:
TAMC 45.1110
Anaheim 3.2212
Azusa 0.3221
Banning 0.1611
Colton 0.3221
Riverside 2.2146
Vernon 1.8119
PGandE 21.7513
SCE 18.7061
SDG&E 3.0452
Western 0.0000
South San Joaquin 2.2000
-19-
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2
3
4
5
6
7
8
9
9.
Trinity 0.3333
Shasta 0.4667
San Juan 0.0667
E1 Dorado 0.2000
Carmichael 0.0667
100.0000"
CHANGES IN OWNERSHIP, PARTICIPATION SHARE, AND FINANCING
RESPONSIBILITY
10
9.1
Sections 4, S, 6, 7, and 8 of this MOU Annex shall
11
whenever necessary be modified by restating
12
percentages to conform to changes in Project
Y3
Participation Share, Project Ownership and Project
14
Financing Responsibility, as these terms are used
15
in the MOU, in accordance with the provisions of
16
the PDA or other agreements among the Participants
D7
which provide for such changes.
t8
9.2
Each Participant may assign its rights and
19
obligations in the Project in accordance with
20
Section 17 of the PDA and any applicable provision
21
of the Participation Agreement contemplated in
22
Sections 2.4 and 11.4 of the PDA, including the
23
layoff of Project transfer capability rights in
24
accordeace with Section 10.4 of the MOU.
25
26
10.
REIMBURSEMENT OF CURRENT PARTICIPANTS
27
10.1
Not later than ten (10) days after the effective
28
date of this MOU Annex, each Additicnal
-20-
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2
3
4
5
6
7
8
9
DO
11
13
14
15
16
17
18
19
20
22
23
24
25',
26
27
28
Participant shall reimburse each Current
Participant, except CDWR, for its share of all
payments made and due and payable to the Project
Manager by each Current Participant as of the
effective date of this MOU Annex for Project
Development Work in accordance with the Interim
Cost Sharing Agreement and the Project Development
Agreement ply:. interest in accordance with
Section 10.3 below.
10.2 Each Additional Participant's share of such costs
shall be that amount that each Additional
Participant would have paid to the Project Manager
for Project development work had that Additional
Participant been an original signator to the MOU
and paid all amounts due and payable under the
Interim Cost Sharing Agreement and the Project
Development Agreement, based upon its financing
responsibility percentage.
10.3 The amount to be reimbursed by each Additional
Participant to each Current Participant in
accordance with this Section 10, shall include an
Interest charge assessed at an annual rate of
interest, compounded monthly, equal to the lesser
of (a) the applicable first of the month reference
rate, or successor, of the Bank of America N.T. i
S.A., San Francisco, California, corresponding to
the period for which reimbursement is made; or (b)
the maximum interest rate permitted by law. Such
-21-
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3
4
5
6
7
8
9
10
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12
13
14
15
16
17
18
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20
22
23
24 11.
25
26
27
28
11
interest shall.be charged against the amount to be
reimbursed from the time the Current Participant
made its original payment to the tine such
reimbursement is paid by the Additional
Participant.
10.4 No later than the effective date of this
Agreement, the Project Manager shall compute the
amount of funds to be reimbursed by each
Additional Participant in accordance with the
provisions of this Section 10 and shall provide
the results of this computation to each Current
Participant and each Additional Participant. The
Project Manager shall issue a cash call to the
Additional Participants on behalf of the Current
Participants to whom reimbursements are to be made
and shall collect and disburse those funds
collected in accordance with this Section 10. In
no case shall the Project Manager, acting in its
capacity as such, be responsible on bohalf of an
Additional Participant for any reimbursement owed
to any Current Participant in accordance with this
Section 10.
CONSTRUCTIVE WITHDRAWAL
11.1 Should any Additional Participant fail to duly
sign this MOU Annex within ten (10) days after its
effective date, fail to reimburse Current
Participants in accordance with Section 10, or
-22-
1
2!
3
4
5
6
7
8
9
10
ll
13
14
15
36
17
l8
19
20
21
22
23
24
25
26
27
28
fail to meet any condition imposed by Western in
its stated allocation criteria (50 Fed. Reg.
31912) within the period established by Western,
that Additional Participant shall be deemed to
have withdrawn from the Project and that
Additional Participant's Share, as defined in the
PDA, shall be revoked and placed in an allocation
pool for reallocation to the other Additional
Participants or the Current Participants (except
Western) in a manner consistent with Western's
stated criteria (50 Fed. Reg. 31912). Should any
portion of that additional Participant's
allocation not be reallocated to the other
Additional Participants, such unallocated portion
shall revert to the Current Participants and shall
be sad* available to each of them in a manner
consistent with Section 13 of the PDA or
appropriate provisions of the Participation
Agreement, whichever is applicable. Any right to
reimbursement for funds paid toward the
development and operation of the Project shall be
as defined in the PDA or Participation Agreement,
as applicable.
11.2 The following is substituted for and replaces
Section 13.4 of the PDA:
013.4 If the amount of the withdrawing
Participant's Share voluntarily assumed
by the non -withdrawing Participants is
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
22
23
29
25
26
27
28
less than 100 percent of the
withdrawing Participant's Share, each
non -withdrawing Participant shall
assume its respective portion of the
balance of the withdrawing
Participant's Share, in an amount
proportionate to that which its Cost
Sharing Percentage bears to the total
Cost Sharing Percentages of
non -withdrawing Participants identified
in Section 5.1t provided that no
Participant shall be obligated in total
for more that 1.15 times its Cost
Sharing Percentage as of the effective
date of this Agreement. A Nonutility
Participant shall not be obligated to
assume any portion of the withdrawing
Participant's Share."
11.3 The following is added as a new Section 13.12 to
the PDAs
013.12 If an Additional Participant withdraws
from the Project in accordance with
Section 13, or is found in default in
accordance with Section 20, then such
Additional Participant's allocation
shall be revoked and shall be made
available to the non -withdrawing
-24-
1
2
3
4
5
6
7
81
91
10
11
12
13
14
15
16
17
18
19
20
22
23
24
25
26
27
28
Participants (except Western) on a pro
rata basis.
12. ASSIGNMENT
12. The following is substituted for and replaces
Section 17.1 of the PDA:
017.1 A Participant may assign or transfer
any right or interest in this
Agreement, in whole or in part, only
after obtaining the written consent of
the other Participants, which consent
shall not be unreasonably withheldr
provided that a Participant may
withhold consent to any proposed
assignment or transfer either (1) to an
entity or association which is not
CMM, Western, or a public electric
utility regulated under applicable
state law or the Pederal Power Act or
exempted from such regulation by reason
of being a public entity, or (2) to an
entity or association which does not
have public utility responsibilities
with regard to serving electric power
to customers. A Participant shall not
withhold consent to any assignment or
transfer between Participants allocated
Project transfer capability by Western
-25-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
�AI
24
25
26
27
28
as set forth in 50 Fed. Reg. 42769
(1985) solely because that entity is a
Nonutility Participant, provided that
such assignment or transfer concerns
part or all of the 3.125 percent of
Project transfer capability allocated
by Western and interests attendant
thereto, and no other interest in the
Project. Consent to a proposed
assignment to a joint powers,agency
which is a Participant shall not be
withheld solely because that entity is
a joint powers agency. bio Participant
shall bring, initiate or amend,
directly or indirectly including by
means of cross-complaint or other
affirmative ailegation,,an action or
proceeding before a court or an
administrative agency against another
Participant to contest the withholding
of consent by such Participant in
accordance with clauses (1) or (2) of
this Section 17.1 or the reasons
therefor or the validity of this
Section 17.1, other than a dispute
regarding the factual application of
such clauses. The withholding of
consent by a Participant in accordance
-26-
1
2
3
4
5
6
7
3
9
10
11
12
13
14
15
16
17
19
20
22
23
24
I
25
26
27
28
with clauses (1) or (2) of this
Section 17.1 shall not indicate
approval or disapproval by any other
Participant of such withholding."
13. OPINIONS OF COUNSEL
The following is substituted for and replaces Section 11.3
of the MOU:
"11.3 Contracts among the Participants shall
then be negotiated to implement these
principles. As a condition of
execution of any contracts implementing
this HOU each Participant shall furnish
the other Participants with a written
Opinion of Counsel in which it is
represented that said Participant has
the authority to enter into,such
contracts and to be bound by the terms
and conditions thereof. In the case of
the Agency, each major member agency
thereof shall furnish such Opinion of
Counsel. In the case of an Additional
Participant that is a joint powers
agency, the individual member agencies
of that joint powers agency shall not
be obligated to provide such Opinions
of Counsel but the joint powers agency
-27-
3i
41
1
5i
G
i
8
9
itself shall provide such Opinion of
Counsel of benalf of the agency."
14. SIGN*ATURE CLAUSE
The signatories of this MOU Annex represent thzt the. have 1
been appropriately authorized to enter into this HOU Annex on
behalf of the entity for whom they sign. This MOU annex may be
executed in counterparts.
101�i
CITY OF ji EIM
Sy:
00: &1#1
12 i
Same:
Dor R. Roth
Arr.-.;.ST:
13��
Title:
Mayor
i
/
(
Cate:
March 18. 1486
.
icy clerk. c ty of Anaheim
1
=117Y OF AZUSA
'iii
By:
1
13 j4
Name:
;
Title:
20f�
Date:
'
21�
22'
CITY OF BA.NING
23i
By:
!
24!(
Name:
1
i
25:
Title:
2G.
I
Date:,
!
1
27:
231.
ii
J..
1
2
3
4''
5
6
7
8
9
DO
DD
12
13
14
35
36
17
D8
19
20
21
22
23
24
25
26
27
28
itself shall provide such Opinion of
Counsel of behalf of the agency.•"
14. SIGNATURE CLAUSE
The signatories of this MOU Annex represent that they have
been appropriately authorised to enter into this MOU Annex on
behalf of the entity for Whoa they sign. This MOU Annex may be
executed in counterparts.
CITY OF ANAHEIM
By$
Name:
Title:
Date:
CITY OF AEUSA
sr!
Names ,U8*ne F. Moes$
Title: Mayor
Date t February 18. 1986
By$
Name:
Title:
Date:
-28-
CITY OF BANNING
t
itself shall provide such Opinion of
Counsel of behalf of the agency."
14. SIGNATURE CLAUSE
The signatories of this HOU Annex represent that they have
been appropriately authorized to epter into this MOU Annex on
behalf of the entity for Whom they sign. This MOU Annex may be
executed in counterparts.
CITY OF ANAHEIM
DY=
game$
Titles
Date:
CITY OF AZUSA
Sys
games
Titles
Date$
CITY PF
Sys
Mame: .01 SAM J.jOIO
Titles City Manager
Date: Misch 12. 1986
-28-
f
2
3
4
5
6
7
8
9
• Df
12
13
14
15
16
17
f8
19
28
22
23
24
25
26
27
28
Ayprohd e's to zosa1 toto
and auttsesomot�
CALIFORNIA DEPARTMENT OF
WATER R$SOURCES
By tiv
Names a
Titles IIaD* M. dw.0.
Dates NSR A KSS
By=
Names
Title:
Date e
Sy:
Bases
s
Title:
Data$
CARMICCHAEL WATER DISTRICT
CITY OF COLTON
EL DORADO BILLS COMMUNITY
SERVICES DISTRICT
By:
Daae:
Titl::
Data:
Since GDWR is not a party to the Project Development
Agreement (PVA), CDWR's approval of this MOU Annex is not
intended to express either approval or disapproval of
Sections B. 11.2, 11.3 and 12, which do nothing other than
amend certainsectionsof the PDA.
-29-
9
1t►I
11
12
13
14
15
16
17
I8
19
20
21
23
24
25
26
27
28
CALIFORNIA DEPARTMENT OF
WATER RESOURCES
By=
Names
Titles
Date=
CNAEL, WATER DISTRICT
Mame= er McCin
Titles Secretary/General Manager
Dates February 21, 1986
CITY OF COLTON
By
Names
Titles
Dates
EL DORADO BILLS COMMUNITY
SERVICES DISTRICT
Sys
Names
Title:
Date:
-29-
26
27
28
-29-
l
CALIFORNIA DEPARTHE.M OF
2
WATER RESOURCES
s
By:
4
blame:
5
Title:
6
Date:
i
g
CARMICEML WATER DISTRICT
9
DY=
10
(tame:
D1
Title:
12
Dates
19
14
CITY OF COLTON
15
By: A
16
blame:
17
Title: Mayor
18
Date:
19
20
LL DORADO HILLS COMMUNITY
21
SERVICES DISTRICT
22
Hy:
2,3
blame:
24
Title:
25
Date:
26
27
28
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2
3
4
5
6
7
8
9
'11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27'
28
f`'•�t
CALIFORNIA DEPARTMENT OF
WATER RESOURCES
Sy:
loame$
Title:
Date$
CARMICHAEL WATER DISTRICT
Sy$
Names
Titles
Dates
CITY OF COLTON
By
Names
Title
Date$
ZL DORADO SILLS COMMUNITY
SERVICES.DISTRI�JCT
By:
dame $
Title:,��i �c-f
Date $ •�/j3 / f'G
5*M
r
DA'P No. 10259A
As a party to the MOU but which is not a party
to any other Project Agreement, the Los Angeles Department of
Water and Power (LADIVP) regards Sections 8, 9.2, 10, 11 and 12
of the SIOU Annex, as having no involvement with LADt%'P. LADN'P
further considers Section 3 of the MOU Annex as being the only
section of this Agreement which involves LADHP's interests in
the amended MOU, which interests are limited to those
expressed in Section 4.1 and 4.4 of the MOU.
Afl'RM AS TO FLIM ANO LEGAIM
jAMES K RAN, CM ATTORNEY
8E
XY1
ALS... lr wFtcON
silt t ity Attorney
DEPARTMENT OF NATER AND PAVER
OF THE CITY OF IAS ANGELES
by
BOARD OF WATER AND PO%%T.R CMMI SS IONZERS
OF THE OF LOS ANGELES
By
and
e c re_,yary
z
9
1
5
6
7
8
9
10iIl.
13
14
15
16
17
18
19
20
21
22
23
24
23
26
27
28
Los ANGELES D£IPARTMENT or
WATER AND POWXR
Bys
Names
Title:
Dates
PACIFIC OAS AND ELECTRIC
ANY
BYs
Games „ j sorn A. HAS 2atie
Executive Vice_President
Titles Fac. -and Else. me Dey*122
Dates February 11, 1986
eys
Names
Titles
Dates
By:
Nam:
Title:
Date:
-3o-
CITY OF RIVERSIDE
SAN DIEGO GAS i ELECTRIC
COMPANY
22'
23
241
26
26
27
28
LOS ANGELES DEPARTMENT OF
WATER AND POWER
By
Name:
Title:
Date:
PACIFIC OU AND ELECTRIC
COMPAW
BYa
ffiamet
Title:
Date$
CITY OF RIVE IDE
By$
Name: AB BROW
Titles MAYOR
Dater March 18, 1986
BY =
Name:
Title:
Date:
-30-
SAN DIEGO GAS i ELECTRIC
COMPANY
1
2
3
4
5
6
7
10
11
12
13
14
15
16
N
Is
191 20
21
22
23
24
25
26
27
28
LOS ANGELES DEPARTMENT OF
WATER AND POWER
By:
Names
Titles
Dates
PACIFIC GAS AND ELECTRIC
COMPANY
Bys
Names
Titles
Dates
CITY OF RIVERSIDE
Names
Titles
Dates
SAN DIEGO GAS & ELECTRIC
COMPANY
2 "000e
By:
/OF
Name: J. C. Holcombe
Title: Vice President. Fuel & Power Controc
Date: FebruAry 21, 1986 -
—30—
Le
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
SAN JUAN SUBURBAN WATER
i
DISTRICT
BY=
Name9a� vi�C� _ B
Titlea
Date$
SHASTA DAM AREA PUBLIC UTILITY
DISTRICT
By
Name:
Title:
Date:
SOUTHERN CALIFORNIA BDISON
8r=
Names
Title:
Date:
SRN SAN JOAOUIN VALLEY
POWER AUTHORITY
SY=
Name:
Title:
Date:
-31-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15'
16
17
18
19
20
22'.
23
24
26
27
28
SAN JUAN SUBURBAN WATER
DISTRICT
By:
Name:
Title:
Date$
SHASTA DAM AREA PUBLIC UTILITY
By:
'
esl e O T reCtors
Bv:
•
Cler Boar of SUMER
Date:
February 19. 1986
I
SOUTHERN CALITOMIA EDISON
Br=
fie:
Title:
Date:
SOUTMM SART JOAOUIN VALLEY
POWER AUTHORITY
Sy:
Base:
Title:
Date:
-31-
1
2
3
4
5
6
i
8
9
.10
11,
12,
13
14
15
16
17
18
19
20
22
23
24
25
26
27
28
nstoa
l01�1 R ��►
a
?� . iW7�
SAN JUAN SUBURBAN WATER
DISTRICT
By$
Names
Titles
Dates
SHASTA DAM AREA PUBLIC UTILITY
DISTRICT
By$
Names
I
Titles
Dates
Names Edward A. Myerse, Jr.
Titles Vice President
Dates March 7, 1986
Sys
Names
Titles
Dates
-31-
SOUTHERN _SAN JOAGUI-R VALLEY
POWER AUTHORITY
1
2
s
4
5
6
i
7
8
9
10
11'
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
SAN JUAN SUBURBAN WATER
DISTRICT
Br=
Name:
Title:
Date:
SHASTA DAM AREA PUBLIC UTILITY
DISTRICT
Sys
Name:
Title:
Date
SOUTHERN CALIFORNIA EDISON
Names
Title:
Date:
SOUTHERN SAN JOAOUIN VALLEY
Pq(ER AUTHORITY/ /
Sy:
Name: KENNETH M. WEGIS
Title: CHAIRr3AN OF THE BOARD
Date: FEBRUARY 19, 1986
-31-
l
2
3
4
5
6'
7
S
9
10
11
12
13
14
15
16
17
is
H9
20
22
23
2!
25
26
27
28
TRANSMISSION AGENCY OF
arORNIA
By:
Names
Title:
Date$
TRINITY COUSTY PUBLIC UTILITY'
DISTRICT
Sys
Masse:
Title:
Date$
CITY OF VERNON
Ry$
Names
Title:
Date:
WESTERN AREA POWER
ADMINISTRATION
By:
game:
Title:
Date:
-32-
r
—32—
TPJJSMISSION AGENCY OF
NORTHERN CALIFORNIA
RYs
Names
Titles
Dates
TRINITY COMM PUSLIC UTILITY''.
DISTRICT
By
Names
Lj
Titles
s a"Ir o f lod= -
Date=lz.
CITY Or VERNON
RYs
Nauss
Titles
t
Dates
WESTERN AREA POWER
ADMISISTRKTION
Hy$
-
Names
Title:
Dates
—32—
1
2
3
4
5
6
i
8i
9�
10
11
. 12
13
14
15
16
17
18
APPROVED A8 TO TORY
19
b.
E. BREARL&T
wA)DAVID
CITY ATTORNEY
21
22
23
24
26i
26
271 28
TM SMISSION AGENCY OF
NORTHER,'; CALIFORNIA
By:
Name:
Title:
Dates
TRINITY COUNTY PUBLIC UTILIaTY
DISTRICT
By:
Name:
Title:
Date:
CITY OF VERNON
By: ..
Names
Title: Mayor
Dates Marrch 4 9 5
ATTEST:
City Clerk!
WESTERN AREA PM7ER
ADMI: S:'RI,:ICS
By:
i
Name:
Title:
Date: t
i
i
f
1
2�
3
4'
51
6
7
8
9
10
I1
. 12
13
1�4
15
16
17
l8
19
20
22
23
24
25
26
27
28
TRANSMISSION AGENCY OF'
NORTHERN CALIFORNIA
Sys
Name:
Title:
Date:
TRINITY COUNTY PUBLIC UTILITY
DISTRICT
Sys
Name$
Titles
Date$
-32-
CITY OF VERNON
Bys
Name:
Titles
Dates
WESTERN AREA POWER
,ADMINISTRATION
By:
Names
David G. Coleman
Titles
Area Manager
Date:
February 21, 1986
-32-
O O
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D-1
1
APPENDIX D
PRESCBEDULING OF TRANSKISSION USS
2
AND CURTAILMENT NOTIFICATION PROCEDIIRES
3
4
5
1. OPERATING
AGENT INTERFACES:
6
1.1
Through the TANG Coordinator, TANG shall notify the
7
Operating Agent relative to the amounts of Transfer
s
Capability that TAMC will be using, as required by the
9
Intertie-Agreements.
10
1.2
It is anticipated that the Operating Agent will notify
11
TAMC through the IANC Coordinator when a curtailment
12
affecting Transfer Capability is scheduled or has
13
occurred, as provided in the Intertie Agreements.
14
1.3
It is anticipated that the Operating Agent will notify
15
Members or their designated agents directly of a real -
16
time curtailment of Transfer Capability. Each Member
17
or its designated agent will be responsible for
18
communicating and coordinating real-time power
19
schedule curtailments and all changes in schedules due
20
to curtailments occurring in real-time pursuant to its
21
separate agreements with other entities.
22
23
2. TANNC
TRANSFER CAPABILITY PRESCHEDULING PROCEDURES
24
Transfer Capability will be prescheduled over four different
25
time frames - long term (6 years), next operating year, next
26
operating
month, and current operating month.
27
2.1
Long Term and Next Operating Year
28
2.1.1 Each year, each Member shall prepare the
D-1
I
following estimated data pertaining to its
2
use of Transfer Capability for each month of
3
the following six-year period:
4
2.1.1.1 Member's Participation
5
Percentage;
6
2.1.1.2 Contracted Transfer Capability
7
layoffs to Members and
8
Participants;
9
2.1.1.3 Contracted Transfer Capability
10
layoffs from TAMC and
11
Participants;
12
2.1.1.4 Amount of Transfer Capability
13
available for sale; and
14
2.1.1.5 Amounts of additional Transfer
is
Capability desired.
16
2.1.2 This data will be submitted to the TANC
17
Coordinator by July 31 of each year.
18
2.1.3 The TANC Coordinator shall determine the
19
amounts of Transfer Capability owned by
20
other Participants that is unneeded by each
21
of those Participants (if available) and
22
that could be used by TANG.
23
2.1.4 The data will be compiled by the TAMC
24
Coordinator into a document that defines the
25
projected use of the Project by each Member,
26
and on an aggregate TAMC basis, for each
27
month of the six year period. The document
28
will also quantify instances where a Member
a
D-3
1
may want additional Transfer Capability,
2
where a Member may have Transfer Capability
3
that it is not planning to use, and where
4
other Participants have unneeded Transfer
5
Capability.
6
2.1.5
The TAMC Coordinator shall send this
7
document to the Members by August 31 so that
8
they will have data on projected aggregate
9
usage and can identify potential periods
10
when Transfer Capability can be bought and
11
sold among the Members.
12
2.1.6
Those Members who have made buy/sell
13
arrangements for Transfer Capability will
14
notify the TAMC Coordinator of these
15
arrangements and of their effective time
16
frames by September 30.
17
2.1.7
This new data will be utilized by the TAMC
i8
Coordinator to prepare a revised document
19
that defines the projected use of the
20
Project by Member, and on an aggregate TAMC
21
basis, for each month of the six year
22
period. The document will also quantify any
23
amounts of unneeded Transfer Capability and
24
instances where additional Transfer
25
Capability could be utilized by TAMC or by a
26
Member.
27
2.1.8
If the revised document demonstrates
28
unneeded capacity or needs for additional
D-3
1
2
3
4
3
6'
7
•
8
10
11
12
13
14
15
16
17
18
19
21.1 22
24
25
26
27
28
Transfer Capability, it will be resubmitted
to the Members by October 31 so that they
are aware of potential additional buy/sell
opportunities.
2.1.9 Those Members making additional buy/sell
arrangements will notify the TANG
Coordinator of those additional arrangements
and their effective time frames by
November 30.
2.1.10 This updated data will be utilized by the
TANC Coordinator to prepare a revised
document that defines the projected use of
the Project by each Member and on an
aggregate TANC basis for each month of the
six year period. The document will also
quantify any amounts of unneeded Transfer
Capability that was not required by TANG and
instances where additional Transfer
Capability could be utilized by TAMC.
2.2 Next OReratino Month
2.2.1 Each month, each Member or its designated
agent shall prepare the following estimated
hourly data for each of three day -types
(weekday, Saturday, and Sunday/ Holiday)
pertaining to its use of the Project for the
next operating month:
2.2.1.1 Member's Participation
Percentage;
D-4
d
L
1
2.2.1.2 Contracted Transfer Capability
2
layoffs to Members and
3
Participants;
4
2.2.1.3 Contracted Transfer Capability
S
layoffs from Members and other
6
Participants;
7
2.2.1.4 Amount of Transfer Capability
8
available for sale= and
9
2.2.1.8 Amounts of additional -Transfer'
10
Capability desired.
11
2.2.2 This data will be submitted to the TAMC
12
Coordinator by the 20th of the month
13
preceding the operating month in question.
14
2.2.3 The TAMC Coordinator shall determine the
15
amounts of Transfer Capability owned by
16
other Participants that is unneeded by those
17
Participants (if available) and which could
18
be used by IANC.
29
2.2.4 The data will be compiled by the TAMC
20
Coordinator into a document that defines the
21
projected use of the Project by Member, and
22
on an aggregate TANG basis, for each hour of
23
the three day -types specified above. To the
24
extent possible the document will also
25
identify potential layoff opportunities
26
among the Members or between TANG and other
27
Participants.
28
2.2.5 This document will be sent to the TANC
D-5
1
2
3
4
S
6
7
a
9
10
11
12
13
14
is
16
17
is
19
20
21
22
23
24
25
26
27
28
Members by the 21st of the month preceding
the operating month so that they will have
data on projected aggregate usage and can
identify potential periods when Transfer
Capability can be bought and sold among the
Members and between TAMC and other
Participants.
2.2.6 Those Members who have made buy/sell
.arrangements for Transfer Capability -will
notify the TAMC Coordinator of these
arrangements and of their effective time
frames by the 24th of the month preceding
the operating month.
2.2.7 This new data will be utilized by the TAMC
Coordinator to prepare a reprised document
that defines the projected use of the
Project by Member, and on an aggregate TAMC
basis for each hour of the three day -types
specified above and such data will be made
available to the Members. The document will
also quantify any amounts of unneeded
Transfer Capability and periods of time when
additional Transfer Capability could be
utilized by TAMC or a Member.
2.2.8 If any of the foregoing dates falls on a
weekend or holiday, the submittal shall be
made by the work day immediately preceiing
the weekend or holiday.
1 2.3 Corrent Operating Month
2 2.3.1 Data for the current operating month will be
3 contained on a dedicated computerized
4 "bulletin board" that will specify Member
5 use, and to the extent available Participant
6 use, of Transfer Capability on an hourly
7 basis for the month. This data will be the
a same as that prepared for the "Next
9 Operating Month" as described in Section 2.2
10 above.
11 2.3.2 Using the data on the bulletin board the
12 Members or their designated agents may make
13 Transfer Capability buy/sell arrangements
14 among themselves and will notify the TAMC
1s Coordinator of any changes required to the
16 bulletin board as soon as practicable after
17 making such change.
i8
19 3. TANC CURTAILMENT NOTIFICATION PROCEDURES
20 3.1 Curtailment Notification Procedure (Prescheduled) -
21 The TAMC Coordinator shall promptly notify the Members
22 upon receipt of notice from the Operating Agent of any
23 scheduled curtailment of Transfer Capability. The
24 TANC Coordinator may advise the Members of adjustments
25 to Transfer Capability that could be made to minimize
26 the effects of the curtailment on the Members. The
27 steps in this procedure are as follows:
28 3.1.1 The Operating Agent notifies the TANC
D-7
11
2
3
4
5
6
7
a
9
10
11
12
13
14
is
16
17
18
19
2011
21
22
23
24
25
26
27
28
-I\
Coordinator that a curtailment will occur
and the magnitude of the curtailment.
3.1.2 The TAMC Coordinator will update the
bulletin board to reflect each Member's.
remaining share of Transfer Capability.
3.1.3 The TAMC Coordinator will notify each Member
or its designated agent of its share of the
curtailment and may suggest certain actions
(e.g., trading Transfer Cap4bility) that
could be used to minimize curtailment
impacts.
3.1.4 In each event of a prescheduled curtailment
where TAMC still has sufficient Transfer
Capability for the aggregate power schedules
of the Members, by mutual agreement a Member
may utilize another Member's unused share of
Transfer Capability in order to avoid a
curtailment.
3.2 Curtailment Notification Procedure (Real -Timet - The
Members anticipate that (i) the Operating Agent will
notify the TANG Coordinator of real-time curtailments
to Transfer Capability, (ii) the TAMC Coordinator will
communicate and coordinate real-time curtailments to
Transfer Capability with the Members; and (iii) the
Operating Agent will also notify Members or their
designated agents directly of a real-time curtailment
of Transfer Capability. Each Member or its designated
agent will be responsible for communicating and
181W
1
2
3
4
s
6
71
B
9
10
11
12
13
14
is
li
17
is
19
20
21
22
23
24
25
26
27
28
coordinating real-time power schedule curtailments and
all changes in schedu;es due to curtailments occurring
in real-time pursuant to its separate agreements with
other entities. The TAMC Coordinator shall maintain
the bulletin board, based on information received from
the Operating Agent on a real-time basis. It is the
intent of the Members to share the use of Transfer
Capability in order to avoid.curtailments to the
extent possible without jeopardizing service to their
own customers.
3.2.1 Using the data on the bulletin board, the
Members may make Transfer Capability
buy/sell arrangements among themselves and
will make appropriate arrangements relative
to changes in the amount of reserved
transmission capacity and the corresponding
power schedule changes pursuant to their
separate agreements with other entities.
3.2.2 The Members will notify the TAMC Coordinator
of any changes in the amount of Transfer
Capcbility they have reserved. The TAMC
Coordinator will update the data on the
bulletin board.
10=
F11
21
31
APPENDXX 8
BILLING ADDRE88E8 OF TSE PARTIES
4 City of Alameda
Bureau -of Electricity
S 2000 Grand Street
Alameda, CA 94501
6
City of.Healdeburg
7 c/o Northern California Power Agency.
180 Cirby Way
8 Roseville, CA 95678
9 City of Lodi
Call Box 3006
10 Lodi, CA 95241-1910
11 City of Lompoc
100 Civic Center Plaza
12 Lompoc, CA 93438
13 Modesto Irrigation District
P. O. Box 4060
14 Modesto, CA 95352
1S City of Palo Alto
P. 0. Box 10250
16 Palo Alto, CA 94303
17 City of Redding
760 Parkview Avenue
18 Redding, CA 96001-3396
19 City of Roseville
2090 Hilltop Circle
20 Roseville, CA 95678
21 Sacramento Municipal Utility District
P. O. Box 15830
22 Sacramento, CA 95852-1830
23 City of Santa Clara
1500 Warburton Avenue
24 Santa Clara, CA 95050
25 Turlock Irrigation. District
P. O. Box 949
26 11rurlock, CA 95381
27
28
City of. Ukiah
300 Seminary Avenue
Ukiah, CA 95482
E-1
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7'
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14
is
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Plumas-Sierra Rural Electric Cooperative
P. O. Box 2000
Highway 70,-3 Miles West of Portola
Portola, CA 96122-2000
Transmission Agency of Northern California
P. O. Box 661030
Sacramento, CA 95866
E--2