HomeMy WebLinkAboutAgenda Report - October 28, 2014 B-02 SMAGENDAITEM 13,02
CITY OF LODI
COUNCIL COMMUNICATION
TM
AGENDA TITLE: Authorize City Manager to Execute Memorandum of Understanding
Relating to Central Valley Project Improvement Act Judicial Action Pursuant
to the Northern California Power Agency Legislative and Regulatory
Program Agreement
MEETING DATE: October 28, 2014 - Special Meeting
PREPARED BY: City Attorney
RECOMMENDED ACTION: Authorize City Manager to execute Memorandum of Understanding
relating to Central Valley Project Improvement Act Judicial Action
pursuant to the Northern California Power Agency Legislative and
Regulatory Program Agreement
BACKGROUND INFORMATION: The Northern California Power Agency (NCPA) filed a complaint
against the U. S. Bureau of Reclamation on September 4, 2014,
with respect to the overpayment of Central Valley Project Improve-
ment Act (CVPIA) Restoration Funds, on behalf of NCPA and its members. The action, Northern
California Power Agency, City of Redding, California, City of Roseville, California, and City of Santa
Clara, California v. the United States (United States Court of Federal Claims Case No. 14-817C) (the
"CVPIA litigation"), seeks the recovery of over $45 million in overcharges imposed by the Bureau over the
last six years for the CVPIA Restoration Fund.
Prior to the filing of the CVPIA litigation, NCPA Commissioners unanimously agreed that the success of
the litigation would depend in large part on all NCPA Members assuring their ongoing support for and
involvement in the CVPIA litigation. The NCPA Commission agreed that governance of the CVPIA
litigation would be by the Commission, including any decision to dismiss, settle, appeal or respond to an
appeal, with decisions made by votes weighted by relative CVP allocations, and costs of the CVPIA
litigation will be allocated amongst the members by relative CVP allocation.
The Memorandum before Council, modifies the City's opt out authority under the Legislative and
Regulatory Program Agreement (the "L&RPA") of which the City is a party. The Memorandum has been
unanimously approved by the NCPA Commission and staff supports the modification. As revised, the opt
out provision for the CVPIA litigation would provide as follows:
Notwithstanding any provision of the L&RPA to the contrary, no member [of NCPA] will
attempt to exercise any 60 day opt out under the L&RPA until such time as the CVPIA
litigation is resolved to the Commission's satisfaction. Provided, however, that any
member may exercise its 60 -day option to opt out in the event of an adverse final decision
in the CVPIA litigation in the Court of Federal Claims, by providing notice of such decision
to NCPA within 45 -days of such adverse decision. For purpose of clarity, in the event of a
judgment or final decision in the Court of Federal Claims (the trial court level) favorable to
NCPA, an appeal by the United States shall not give rise to an option to opt out. However,
in the event of a judgment or final decision in the Court of Federal Claims (the trial court
level) adverse to NCPA, each member would have an option to opt out of any appeal or
further proceedings by NCPA.
Staff recommends that the City Council authorize the City Manager to execute the Memorandum of
Understanding relating to the CVPIA litigation, a copy of which is attached hereto as Exhibit A.
FISCAL IMPACT: Not Applicable.
r
App ro ed:
Janicle D. Magdich
Gi#y'Attorney
cc: Liz Kirkley, Electric Utility Director
Attachment
Memorandum of Understanding Relating to CVPIA Judicial Action Pursuant to the
NCPA Legislative and Regulatory Program Agreement
On August 28, 2014, the NCPA Commission unanimously approved the filing of litigation
against the U.S. Bureau of Reclamation with respect to the overpayment of CVPIA Restoration
Funds by NCPA Members. Such action has been filed and is named Northern California Power
Agency, City of Redding, California, City of Roseville, California, and City of Santa Clara, California v. the
United States (United States Court of Federal Claims case no. 14-817C) (the "CVPIA litigation").
At the time of such approval, all NCPA Commissioners present agreed that the success of the
CVPIA litigation will depend in large part on all NCPA Members assuring their ongoing
support for and involvement in the CVPIA litigation. Therefore, approval by the Commission
was made with the understanding that each Member agrees that:
(1) governance of the CVPIA litigation shall be by the NCPA Commission(including
whether to dismiss, settle, appeal or respond to an appeal), with decisions made by votes
weighted by relative CVP allocations, and costs of the CVPIA litigation will be allocated
amongst the members by relative CVP allocation; and
(2) notwithstanding any provision of the Legislative and Regulatory Program Agreement
(the "L&RPA") to the contrary, no member will attempt to exercise any 60 day opt out
under the L&RPA until such time as the CVPIA litigation is resolved to the
Commission's satisfaction. Provided, however, that any member may exercise its 60 day
option to opt out in the event of an adverse final decision in the CVPIA litigation in the
Court of Federal Claims, by providing notice of such decision to NCPA within 45 days
of such adverse decision. For purposes of clarity, in the event of a judgment or final
decision in the Court of Federal Claims (the trial court level) favorable to NCPA, an
appeal by the United States shall not give rise to an option to opt out. However, in the
event of a judgment or final decision in the Court of Federal Claims (the trial court level)
adverse to NCPA, each member would have an option to opt out of any appeal or
further proceedings by NCPA.
This memorandum of understanding reflects each Member's agreement to the foregoing.
Accepted by NCPA Member:
Name of NCPA Member:
Signature:
Its:
Date:
2329449.3
Approved asform
C Attorney