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HomeMy WebLinkAbout2022-07-18 Study SessionCITY OF -ASHLAND CITY COUNCIL STUDY SESSION Monday, July 18, 2022 HELD HYBRID - Council and some City Staff will be live in the Council Chambers, 1175 E. Main Street. Citizens and presenters will be joining via zoom View on Channel 9 or Channels 180 and 181 (for Charter Communications customers) or live stream via rvtv.sou.edu select RVTV Prime. Written and oral testimony will be accepted for public input. For written testimony, email public-testimonyn.ashland.or.us using the subject line: Ashland City Council Public Testimony. For oral testimony, fill out a Speaker Request Form at ashland.or.us/speakerrequest and return to the City Recorder. The deadline for submitting written testimony or speaker request forms will be on Monday, July 18th at 10 a.m. and must comply with Council Rules to be accepted. 5:30 p.m. 1. Public Input (15 minutes, maximum) 2. Coordinated Water Rights Management and Water Sharing Plan Intergovernmental Agreement 3. Review and Discussion of the Imperatrice Lease 4. Look Ahead 5. Adjournment In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Administrator's office at (541) 488-6002 (TTY phone number 1-800-735- 2900). Notification 72 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to the meeting (28 CFR 35.102-35.104 ADA Title I). COUNCIL MEETINGS ARE BROADCAST LIVE ONLINE RVTV.SOU.EDU (SELECT CHANNEL RVTV PRIME), ON LOCAL CHANNEL 9, OR ON CHARTER CABLE CHANNEL 180 OR 181. VISIT THE CITY OF ASHLAND'S WEB SITE AT WWW.ASHLAND.OR.US. Council Study Session July 18, 2022 Agenda Item Coordinated Water Rights Management and Water Sharing Plan Intergovernmental Aqreement From I Scott Fleury PE Contact I Scott.fleuryCo.ashland. or. u Public Works Director s 541-552-2412 Item Type I Requested by Council ❑x Update ® Request for Direction ❑ Presentation ❑x SUMMARY Before the Council is an Intergovernmental Agreement (IGA) for a Coordinated Water Rights Management and Water Sharing7Plan between the Medford Water Commission (MWC) and the "Partner Cities" that utilize MWC for treated water delivery. POLICIES, PLANS & GOALS SUPPORTED City Council Goals: • Essential Service -Drinking Water System Emergency Preparedness Address Climate Change CEAP Goals: Natural Systems: Air, water, and ecosystem health, including opportunities to reduce emissions and prepare for climate change through improved resource conservation and ecosystem management. • Strategy NS-2: Manage and conserve community water resources • Strategy NS-3: Conserve water use within City operations Department Goals: • Maintain existing infrastructure to meet regulatory requirements and minimize life -cycle costs • Deliver timely life cycle capital improvement projects • Maintain and improve infrastructure that enhances the economic vitality of the community • Evaluate all city infrastructure regarding planning management and financial resources BACKGROUND AND ADDITIONAL INFORMATION In early 2020, MWC and the Cities of Talent, Ashland, Phoenix, Eagle Point, Central Point and Jacksonville (Partner Cities) completed a joint water rights strategy related to the water rights authorizing diversion at Medford Water's Duff Water Treatment Plant (WTP) on the Rogue River. The water rights strategy included a proposed approach to ensure orderly certification of the water rights at the Duff WTP; it also included a proposed plan for sharing water supply to meet combined short-term (Phase 1) and long-term (Phase 2) water supply needs for all partner entities. The Medford Water Commission Board directed General Manager, Brad Taylor, to work with "other cities" partners to develop the proposed IGA under certain guiding principles. These principals included Page 1 of 3 C 1 T Y OF -ASH LAN D the following: 1. Medford Water would be (and receive compensation for being) the Managing Agency for the Partners but will not have a fiduciary responsibility to the other Partners. 2. The agreement must be consistent with the City of Medford's January 1, 1999, City Charter. 3. The agreement must ensure that Medford Water retains control of its water rights, the Duff WTP, and related infrastructure. 4. The agreement should relate only to water rights associated with the Duff WTP (and not to the Big Butte Creek water rights). 5. The Phase 1 IGA would provide for water sharing among the Partner Cities and would seek commitments to develop a Phase 2 agreement. Medford Water would not, however, be bound to enter into a Phase 2 agreement. 6. Medford Water could withdraw from the sharing agreement. Over the past two years, MWC has met monthly with representatives of the Partner Cities to develop an IGA to implement Phase 1 of a water -sharing agreement. The Partners have developed an IGA that provides for orderly certification of the water rights at the Duff WTP, and a mechanism by which the Partner Cities would share water supply under their water rights and MWC would function as the Managing Agency. The IGA provides that the Partner City water -sharing agreement would begin on October 1, 2022, but a "dry run" is planned for May through September 2022. The IGA would renew every five years, consistent with the term of existing water supply agreements. The IGA provides for an annual meeting to review the water sharing calculations and discuss other issues related to provisions in the IGA. The proposed IGA meets the guiding principles provided by xhe MWC Board. MWC will be the Managing Agency, and costs associated with these functions will be passed to the cities through costs of service and associated water rates. Additionally, the IGA pertains to only the water rights associated with the Duff WTP and expressly states that MWC (and all other partners) retain ownership of their water rights, and Medford Water retains ownership of the Duff WTP and related infrastructure. The agreement provides for water sharing among the Partner Cities and includes a mechanism for Partners to withdraw from the sharing agreement. The IGA recognizes that the water rights strategy recommended a second phase but provides that entering into the Phase 1 agreement does not bind a party to enter into a Phase 2 agreement. Finally, the proposed IGA has been reviewed by legal counsel of the MWC and Partner Cities. The IGA in its full form is referenced as attachment # 1 below. The IGA is intended to be supplemental to the Treat and Transport and wholesale water agreements that already exist between MWC and the partner cities. Approval Status: Central Point on April 28t' — Approved Phoenix on May 2°d— Approved Jacksonville on May 3rd — Approved Eagle Point on May 101 —Approved Scheduled: Ashland — July 19`h Talent — 3rd week of May Page 2 of 3 CITY OF -ASHLAND Staff will be seeking approval by the City Council to authorize the City Manager to enter into the formal IGA. The Medford Water Commission Board will complete the adoption process after each individual City Council considers adoption. However, the document will be returned for additional approval if significant changes occur after Ashland City Council consideration/approval. Talent -Ashland -Phoenix Intertie (TAP): The City of Ashland has permit for 1000 acre-feet of stored water right in Lost Creek Reservoir that utilizes the Duff Treatment Plant as the point of diversion for delivery of treated water through the TAP system. As part of the certification strategy outlined in the IGA, this water permit is referenced first for certification. The certification date based on the acquisition of the original Lost Creek water right permit was September 7, 2021. This means the City must certify all or a portion of the use and/or request a time extension for the "development" of the remainder of the water right. To certify the permit a "Claim of Beneficial Use" (COBU) must be developed that shows the water was put to use during a water year (October 1 — September 30). During the 2021 season the City pumped 550.6 acre feet of TAP water or 179 MG. Public Works worked with GSI Water Solutions to develop the COBU and "certify" the use of 550.6 acre-feet and obtain a partial perfection water right certificate from the Oregon Water Resources Department (OWRD) on April 12, 2022. Partial perfection references only a portion of the total water right was perfected or shown to be used during the time period. Public Works has requested a time extension to certify the remainder of the Lost Creek stored water right. OWRD has issued a proposed final order for the time extension that will extend the certification time to October 1, 2061 for final perfection of remaining permit volume (449.4 MG). The City will not be able to obtain any more stored water rights from Lost Creek Reservoir until such time as it shows that its demand will exceed currently held water rights within the 20 year planning window. FISCAL IMPACTS City of Ashland's financial obligations under the proposed IGA are described in section VII. Additionally, costs associated with MWC's management of the program will be included in partner cities' rates. The only fiscal impact associated with approval of appointments is the associated with the staff time necessary to participate in partner cities meetings and bring this action forward to Council. DISCUSSION QUESTIONS Does the Council have any questions about the Coordinated Water Rights Management and Sharing Agreement? Does the Council have any questions about water rights or the certification process? SUGGESTED NEXT STEPS Next steps include formal approval by Council to authorize the City Manager to sign the IGA. REFERENCES & ATTACHMENTS Attachment #1: Coordinated Water Rights Management and Sharing Intergovernmental Agreement Attachment #2: Fact Sheet Page 3 of 3 C I T Y O F -ASHLAND INTERGOVERNMENTAL AGREEMENT FOR A COORDINATED WATER RIGHTS MANAGEMENT AND WATER SHARING PLAN Parties This Intergovernmental Agreement (IGA) is between the Medford Water Commission (MEDFORD WATER) and the Cities of Ashland, Central Point, Eagle Point, Jacksonville, Phoenix, and Talent, hereinafter PARTNERS when referred to collectively, and MEDFORD WATER, ASHLAND, CENTRAL POINT, EAGLE POINT, JACKSONVILLE, PHOENIX, and TALENT when referred to individually, and PARTNER CITIES when referring to ASHLAND, CENTRAL POINT, EAGLE POINT, JACKSONVILLE, PHOENIX, and TALENT. II. Recitals A. The PARTNERS all own and operate water systems that supply water to their respective customers; B. The PARTNERS recognize the vital importance of providing a reliable source of water to all their respective customers for public health, safety, and welfare and for sustaining economic development; C. The PARTNERS recognize the importance of water conservation, and each take actions to conserve their water supply. D. The PARTNERS have invested in and each hold water right(s) that are diverted and treated at the Duff Water Treatment Plant (WTP) located on the Rogue River, and understand the importance of strategically managing those water rights; E. The Duff WTP, owned by MEDFORD WATER, provides treated water to the PARTNERS and is a critical regional water supply facility. F. The PARTNER CITIES receive water treated at the Duff WTP under Treat and Transport contracts with MEDFORD WATER. These contracts include rates of water that the PARTNER CITIES can receive from the MEDFORD WATER's water supply system during identified time periods. G. The PARTNERS value the important role each utility plays in meeting the water supply needs of the Rogue Valley Region; H. The PARTNERS entered into a cooperative agreement for developing a water rights strategy in 2019, which resulted in development of a Final Report entitled WATER RIGHTS .STRATEGY FOR PARTNER WATER PROVIDERS (February 2020). The cooperative agreement and report executive summary are included in Attachment 1; I. The WATER RIGHTS STRATEGY FOR PARTNER WATER PROVIDERS recommends Phase I of the Coordinated Water Rights Management and Sharing Plan, which includes a coordinated water rights certification strategy for water rights diverted at the Duff WTP and a PARTNER CITIES water sharing framework; J. The WATER RIGHTS STRATEGY FOR PARTNER WATER PROVIDERS recommends a Phase II of the Coordinated Water Rights Management and Sharing Plan to continue the water rights certification strategy for water rights diverted at the Duff WTP and a PARTNER CITIES and MEDFORD WATER water sharing framework. A separate IGA will need to be developed and approved for Phase II; K. The PARTNERS recognize that this IGA is related to Phase I of the Coordinated Water Rights Management and Sharing Plan; and L. The PARTNERS enter this agreement in a spirit of good will and mutual cooperation, understanding that entering this IGA for Phase I of a Cooperative Water Rights Management and Water Sharing Plan is intended to improve the current and long-term reliability of individual and collective water supplies and is in the highest public interest. III. Scope and Purpose To develop, refine and implement Phase, I of a Coordinated Water Rights Management and Water Sharing Plan that includes a coordinated water rights certification strategy for water rights diverted at the Duff WTP and a PARTNER CITIES water sharing framework. This IGA does not address Phase II of a Coordinated Water Rights Management and Water Sharing Plan, which would be established in a separate IGA. Being a signatory to this IGA does not require a PARTNER to become a signatory to an IGA developed for Phase II. IV. Retention of Asset Ownership A. Each Partner will retain ownership of its water right(s). Nothing in this IGA will have the effect of conveying a water right to any other entity. B. MEDFORD WATER will retain ownership of the Duff WTP, the associated intake on the Rogue River, and all related infrastructure. Nothing in this IGA will have the effect of conveying any of MEDFORD WATER's water system to any other entity. V. Water Right Certification Coordination A. The PARTNERS developed a strategy for managing the timing of certification of their existing water use permits and transfers, which is described in the Water Rights Certification Strategy Table provided in Attachment 2. The table identifies the water rights that have been or can be certificated at the current Duff WTP capacity (70 cfs), and the permits and transfers to be certificated at each subsequent WTP capacity (100 cfs, 131 cfs, 162 cfs and 193 cfs). Except as provided in subsection D of this section, only the portion of the Water Rights Certification Strategy Table for the Duff WTP's existing capacity of 70 cfs is applicable to this IGA for Phase I of the Water Rights Management and Water Sharing Plan. B. The PARTNERS agree to submit claims of beneficial use (COBUs) and requests for Water right certificates to the Oregon Water Resources Department (OWRD) only at times consistent with the portion of the Water Rights Certification Strategy Table for the Duff WTP's existing capacity of 70 cfs, except as provided in subsection D of this section. C. At least 14 days prior to submitting a COBU and request for water right certificate to OWRD, PARTNERS agree to provide the Managing Agency with written notice of their intention to file a COBU. D. The Water Rights Certification Strategy Table will be reviewed by the PARTNERS annually as described in Section VIII, and will be updated to reflect the issuance of water right certificates consistent with Water Rights Certification Strategy. E. Each PARTNER will continue to be responsible for maintaining its own water rights, which will include but is not limited to filing water use reports with OWRD, developing claims of beneficial use and requesting water right certificates, and developing water management and conservation plans. VI. Water Sharing A. Consistent with the PARTNER CITIES' contracts with MEDFORD WATER, each PARTNER CITY will use water under its individual water rights beginning May 1 of each year and ending September 30 of each year. B. By November 15 of each year, MEDFORD WATER will calculate the total volume of water used by each PARTNER CITY during the period of May 1 through September 30 based on meter readings for each city, referred to as each city's "Annual Metered Volume." The meters used to determine each PARTNER CITY'S "Annual Metered Volume" are listed in Attachment 3. 1. The owner of each meter will ensure its meter(s) are calibrated to manufacturer standards. 2. If a meter breaks or malfunctions the PARTNERS will use the best practicable information available to estimate water use. C. MEDFORD WATER will compare each PARTNER CITY'S Annual Metered Volume to the total volume of water authorized by each PARTNER CITY'S water rights (referred to as each PARTNER CITY'S "Total Authorized Water Volume") as shown in Attachment 4. D. The PARTNER CITIES will notify MEDFORD WATER of any changes to their Total Authorized Water Volume that occur during the May 1 through September 30 period. E. If a PARTNER CITY'S Annual Metered Volume exceeds its Authorized Water Volume, as provided in VI. C., MEDFORD WATER will subtract the Authorized Water Volume from the Annual Metered Volume to obtain that PARTNER CITY'S "Volume of Excess Use" for the year. F. If a PARTNER CITY'S Annual Metered Volume is less than that city's Authorized Water Volume, as provided in VI. C., MEDFORD WATER will subtract the Annual Metered Volume from the Authorized Water Volume to obtain that PARTNER CITY'S "Excess Water Right Volume" for the year. G. For each PARTNER CITY with a Volume of Excess Use, MEDFORD WATER will allocate the Volume of Excess Use equally among all PARTNER CITIES with an Excess Water Right Volume for that year. MEDFORD WATER will allocate the Volume of Excess Use equally up to, but not in excess of, the PARTNER CITIES' Authorized Water Volumes. If equal allocation of a PARTNER CITY'S Volume of Excess Use would exceed one or more PARTNER CITY'S Authorized Water Volume, the Volume of Excess Use will be allocated equally among the PARTNER CITIES in the amount of the smallest Excess Water Right Volume. The remaining Volume of Excess Use will then be allocated equally among the remaining PARTNER CITIES with Excess Water Right Volume. This process will be repeated until the PARTNER CITY'S entire Volume of Excess Use has been allocated to other PARTNER CITIES. Attachment 5 provides an example of the intended process. H. Any PARTNER CITY with a Volume of Excess Use will provide compensation to PARTNER CITIES with Excess Water Right Volume according to the volume of water allocated to that PARTNER CITY, and the Method of Cost Allocation provided in Section VII. VII. Method of Cost Allocation A. By March 1 of each year, each PARTNER CITY will provide to MEDFORD WATER a copy of any Statement of Account or other invoices from the U.S. Army Corps of Engineers, or annual assessment from the Medford Irrigation District and/or Rogue River Irrigation District the PARTNER CITY received in the previous year related to their water rights associated with the Duff Water Treatment Plant as described in Attachment 2. B. Based on the information provided in subsection A., MEDFORD WATER will calculate the following total annual costs. An example of the calculations is provided in Attachment 6. 1. The Total Annual Operation and Maintenance (O&M) Costs for storage space for Lost Creek Reservoir will be calculated by adding together the annual O&M costs for Ashland, Jacksonville, Phoenix, and Talent. This cost is associated with 3,892 AF of storage space in the reservoir, as shown in Table 1 of Attachment 6; 2. The Total Annual Repair Replacement and Rehabilitation (RR&R) Costs for storage space for Lost Creek Reservoir will be calculated by adding together any annual RR&R costs for Ashland, Jacksonville, Phoenix, and Talent. This cost is associated with the 3,892 AF of storage space, as shown in Table 2 of Attachment 6. 3. The 5-year Rolling Average RR&R Cost for storage space for Lost Creek Reservoir will be calculated by adding together the Total Annual RR&R Costs for the preceding five years and dividing by 5. This calculation is shown in Table 3 in Attachment 6. 4. The Total Annual Assessment Costs will be calculated by adding together the annual costs charged to Central Point and Eagle Point by Medford Irrigation District and Rogue River Irrigation District. This cost is associated with the 3,123.7 AF for which the irrigation districts charge assessments, as shown in Table 4 of Attachment 6. The Total Water Volume Associated with the Costs is 7,015.7 AF, which is calculated by adding 3,892 AF associated with storage space plus 3,123.7 AF associated with the irrigation districts, as shown in Table 5 of Attachment 6. C. The Average Annual Cost Per Acre Foot will be calculated as follows. 1. Calculate the Total Annual Cost by adding together the Total Annual O&M Cost for storage space, the Five -Year Rolling Average RR&R Cost, and the Total Annual Assessment Cost. 2. Calculate the Annual Average Cost Per Acre Foot by dividing the Total Annual Cost by the Total Water Volume Associated with the Costs (7,015.7 AF), as shown in Table 5 of Attachment 6. D. MEDFORD WATER will provide the PARTNER CITIES with the Average Annual Cost Per Acre Foot by March 30 of each year. E. Each year after completing the calculations described in Section VI., for each PARTNER CITY with a Volume of Excess Use, MEDFORD WATER will multiply the Volume of Excess Use allocated to each PARTNER CITY (determined according to Section VI. D.) by the Average Annual Cost Per Acre Foot to obtain the "Annual Cost for Excess Use" owed to each PARTNER CITY. F. By December 15 of each year, MEDFORD WATER will provide the PARTNER CITIES an Annual Summary Report of Water Sharing that includes the following information for the previous May through September: 1. Each PARTNER CITY'S Annual Metered Volume; 2. Each PARTNER CITY'S Authorized Water Volume; 3. Each PARTNER CITY'S Excess Water Right Volume, or Volume of Excess Use for the year; and 4. For each PARTNER CITY with a Volume of Excess Use, the volume of water allocated to each PARTNER CITY with an Excess Water Right Volume, and the associated Annual Cost for Excess Use. An example Annual Summary Report of Water Sharing is provided in Attachment 7. G. By January 15 of each year, the PARTNERS will meet to review the Annual Summary Report of Water Sharing, and will work in good faith to resolve any discrepancies raised by a PARTNER CITY. H. By February 15 of each year, each PARTNER CITY with a Volume of Excess Use shall pay the Annual Cost for Excess Use to other PARTNER CITIES as provided in the Annual Summary Report of Water Sharing. VIII. Annual Meeting A. Medford Water will schedule an annual meeting with the PARTNERS during the month of April each year at a time and location agreeable to the PARTNERS. B. Each PARTNER will, to the extent possible, have at least one representative at the annual meeting. C. Agenda items will include, but are not limited to, the following: 1. An explanation of the processes established by this IGA, as necessary. 2. Estimations provided by each PARTNER CITY of the amount of water it expects to use during the upcoming period of May 1 through September 30. 3. Any available estimations of water supply expected to be available during the upcoming period of May 1 through September 30 4. A review of the Water Rights Certification Strategy Table (the current version is provided in Attachment 2), and a discussion of any updates to the table that are needed or any plans to certificate a water right included in the table. 5. Coordination of any other activities regarding the Water Rights so that all Partners are apprised of actions by a Partner that may affect them. 6. Any amendments needed to this IGA. The process for adoption of amendments is provided in Section XIV. IX. Designation, Tasks and Powers of Managing Agency A. Medford Water shall perform the duties of the Managing Agency hereunder including but not limited to: 1. Coordinating use of the Partners' Rogue River water rights at the Duff Water Treatment Plant in accordance with the terms and conditions of this Agreement. 2. Schedule and convene meetings with the Partners in accordance with the terms of this Agreement and as necessary to meet the requirements of this Agreement, maintain public records in accordance with the Oregon Public Records Law and rules, policies and procedures of Medford Water, and provide administrative support. 3. Provide public communications and outreach, including response to public information, media or records requests in coordination with the Partner Cities. 4. Retain consultants, attorneys, auditors, accountants and other professional services to assist the Managing Agency in accordance with Managing Agency contracting rules. 5. Provide the Partners and their agents with reasonable access to books and records maintained by the Managing Agency specifically related to administration of this Agreement. 6. Perform ministerial and administrative tasks to implement this Agreement. B. The General Manager of Medford Water shall be the person authorized to act for the Managing Agency, unless the Medford Water Commission specifies otherwise. X. Governance A. Each Partner shall appoint a representative, elected or staff member, to receive notices, attend meetings as called and act as a liaison to the Partner's governing body. A Partner's representative shall serve at the discretion of the Partner's governing body, or the City Manager or City Administrator. B. The Representatives shall meet in accordance with the terms of this Agreement and as deemed necessary by the Managing Agency upon reasonable notice to carry out the terms and conditions of this Agreement. XI. Failure to Perform/Breach/Remedies A. If a Partner fails to perform any obligation or term of this Agreement, (Defaulting Partner) the Managing Agency will notify the Defaulting Partner in writing and request performance and cure. If the Defaulting Partner cures the default within 30 days of notice or commences to diligently cure a default within 30 days and completes cure within a mutually agreed time, then the matter will be deemed resolved. B. If the default continues after notice and opportunity to cure, the Managing Agency and the Representative of the Defaulting Partner shall meet within 45 days to discuss and resolve. Other Partners (Remaining Partners) shall be apprised and may attend. C. If no satisfactory resolution is reached, the parties agree to mediate any disputes under ORS Chapter 36. XII. Termination and Withdrawal A. A Partner may elect to withdraw from this Agreement (Withdrawing Partner) by providing written notice to the Managing Agency no later than October 1 of each year. If timely notice is given, the withdrawal shall be effective on the following May 1. B. The Managing Agency will provide the Remaining Partners with timely notice of the withdrawal notice. C. Withdrawal from this Agreement will terminate the obligation to participate in water sharing under this agreement but will not affect any pre-existing agreements that may be operative. Withdrawal shall not relieve the Withdrawing Partner of any outstanding obligations remaining unpaid. D. Upon withdrawal, the Managing Agency will cause the Attachments to this Agreement affected by such Partner's withdrawal to be revised and adjusted as necessary to remove the Withdrawing Partner and its water rights, Authorized Water Volumes, and associated costs identified in the Attachments. The Managing Agency may create a new Attachment for addition to this Agreement to account for change in membership to identify the Partners, and their water rights, Authorized Water Volumes, and associated costs. E. The Managing Agency shall provide the Partner Cities with timely copies of the new or revised Attachment(s). F. This Agreement shall continue after withdrawal of a Partner unless dissolved as provided in Section XV, below. XUL Representations By execution of this Agreement, each Partner represents to the others that the Agreement has been approved by the governing body and that the person executing the Agreement has full authority to do so and the Agreement is binding on the Partner. Further the designated Representative of the Partner is vested with authority to act on behalf of the Partner except for those decisions that require specific governing body approval: amendment and dissolution. XIV. Amendment A. A Partner seeking an amendment to the Agreement shall provide a notice to all other Partners that specifies the section(s) of the Agreement that the Partner seeks to amend, and the nature of the requested amendment. B. The proposed amendment shall be included in the agenda for the next annual meeting. C. This Agreement may be amended only by mutual written agreement of all the Partners, and the amended agreement will become effective on the next October 1 or as otherwise mutually agreed upon by the Partners. XV. Term, Dissolution and Winding Up A. This Agreement shall become effective on October 1, 2022, (effective date) and will continue for five years from the effective date or until the remaining Partners mutually agree to terminate or there is only one Partner remaining, whichever is sooner. B. This Agreement will automatically renew every five years on October 1 (fifth year anniversary date) without further action. C. If this Agreement is amended as provided in Section XIV, the amended agreement will automatically renew every five years from the effective date of the amended agreement without further action. XVI. Notices Any notice required to be given shall be sufficient if given electronically, personal delivery or regular U.S. Mail to the following. A Partner may change the recipient by written notice to the others. If to Medford Water: Medford Water Attn: General Manager 200 S. Ivy St. — Room 177 Medford, Oregon 97501 If to Ashland: City of Ashland Attn: City Manager 20 East Main Street Ashland, OR 97520 If to Central Point: City of Central Point Attn: City Manager 140 S. 3`d Street Central Point, OR 97502 If to Eagle Point: If to Jacksonville: If to Phoenix: City of Phoenix Attn: City Manager 112 W. 2°d St. Phoenix, OR 97535 If to Talent: Jordan Rooklyn PO Box 445 110 E Main St Talent, OR 97540 Attachment 1 Cooperative Agreement and Report Executive Summary .................................................................................................................................................................................................................................................. Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Page 11of4 COOPERATIVE AGREEMENT FOR DEVELOPING A WATER RIGHT STRATEGY FOR ACCESS TO WATER AMONG MEDFORD WATER COMMISSION, CITY OF ASHLAND, CITY OF CENTRAL POINT, CITY OF EAGLE POINT, CITY OF JACKSONVILLE, CITY OF PHOENIX, AND CITY OF TALENT This cooperative agreement (hereinafter "Agreement") is by and among Medford Water Commission and the Cities of Ashland, Central Point, Eagle Point, Jacksonville, Phoenix, and Talent, hereinafter PARTNERS when referred to collectively and MWC, ASHLAND, CENTRAL POINT, EAGLE POINT, JACKSONVILLE, PHOENIX, and TALENT when referred to individually. RECITALS A. The PARTNERS all own and operate water systems that supply water to their respective customers; B. The PARTNERS recognize the vital importance of providing a reliable source of water to all their respective customers for public health, safety, and welfare and for sustaining economic development; C. The PARTNERS value the important role each utility plays in meeting the water supply needs of the Rogue Valley Region (RVR); D. The PARTNERS enter this agreement in a spirit of good will and mutual cooperation, with the understanding that coordinating a Water Right Strategy (WRS) will improve the current and long-term reliability of individual and collective water supplies and is in the highest public interest; E. The PARTNERS understand that the WRS will document the current understanding of the water rights held by the jurisdictions in the RVR, and provide options to the PARTNERS on how to move forward with securing and allocating water supplies for the RVR that may be in the best interests of the Region as a whole, but it will not bind PARTNERS to any particular direction or action; and F. The PARTNERS recognize that developing a WRS is the first step and that a second step of adopting a WRS would require a second IGA that would then guide the adoption, implementation, and management of the WRS moving forward. It is understood that a second step may not be possible if there is not agreement on how to move forward with the WRS. G. The PARTNERS are willing to fund development of a WRS. AGREEMENT The PARTNERS agree to the following: RECITALS/PURPOSE The above recitals are true and correct and are specifically adopted and incorporated herein as the purpose of this Agreement. DEFINITIONS A. ASHLAND means City of Ashland. B. CENTRAL POINT means City of Central Point. C. EAGLE POINT means City of Eagle Point. D. JACKSONVILLE means City of Jacksonville. E. MWC means Medford Water Commission. 2018 COOPERATIVE AGREEMENT FOR DEVELOPING A WATER RIGHT STRATEGY FOR ACCESS TO WATER Page 12of4 F. OWRD means the Oregon Water Resources Department. G. PARTNERS means collectively the Medford Water Commission and the Cities of Ashland, Central Point, Eagle Point, Jacksonville, Phoenix, and Talent. H. PHOENIX means City of Phoenix. I. RVR is an abbreviation for Rogue Valley Region. J. STEERING COMMITTEE means a group comprised of at least a single voting representative from each of the PARTNERS. The Steering Committee function will be to oversee the implementation of this Agreement, to facilitate changes to it necessary to ensure its continued effectiveness in meeting the needs of the PARTNERS and to settle differences in interpretation of its provisions and execution. K. TALENT means City of Talent. L. WRS is an abbreviation for Water Right Strategy. III. RESPONSIBILITIES A. The PARTNERS: 1. Agree to forma STEERING COMMITTEE. 2. Agree not to move forward with any actions to certificate water rights at the MWC Duff Water Treatment Plant intake, except as provided in III.C, until a WRS is completed, or the term of this Agreement ends. 3. Agree to pay the identified, pro-rata costs of the development of a WRS as provided in Section IV (B) of this Agreement. EMIT, lei 1. Agrees to award and administer a contract with GSI Water Solutions to develop a WRS as described in Section IV (A) of this Agreement. 2. Agrees to pay monthly invoices to GSI Water Solutions on behalf of the PARTNERS. C. PHOENIX: 1. Agrees not to request expedited processing of its claim of beneficial use under OWRD's Reimbursement Authority Program for Permit S-47672 until a WRS is completed, or the term of this agreement ends, whichever occurs first. 2. Agrees to notify the PARTNERS within a reasonable period of time in the event that OWRD begins review of its pending claim of beneficial use for Permit S-47672. IV. WATER RIGHT STUDY SCOPE AND COST A. The draft outline of the scope of work to develop a WRS is included as Exhibit A. The PARTNERS intend to collaboratively develop and establish a final scope of work after this agreement is executed. 2018 COOPERATIVE AGREEMENT FOR DEVELOPING A WATER RIGHT STRATEGY FOR ACCESS TO WATER Page 1 3of4 B. The PARTNERS agree to share the cost of the WRS on a pro rata basis in proportion to their populations based on Portland State University's 201S population data, as shown in Exhibit B. Exhibit B indicates preliminary costs. The total cost of the WRS is expected to be less than $80,000. Final pro-rata cost share will be determined at the time the contract with the consultant is signed. Payments by PARTNERS will be due quarterly and must be remitted to MWC within 30 days of invoice. V. DECISION MAKING PROCESS A. All decisions made under this Agreement, and during the course of the development of the WRS, shall be made through negotiations among the PARTNERS. B. The WRS does not bind any PARTNER(S) to any future action or direction proposed by the WRS. VI. LIABILITY, INDEMNITY AND HOLD HARMLESS A. INDEMNIFICATION. To the extent allowed by the Oregon Constitution and the Oregon Revised Statutes, and not to exceed monetary limits of the Oregon Tort Claim Act, the PARTNERS agree to defend, indemnify, and hold harmless each other from claims, liability or damages, including attorney fees, arising out of error, omission or act of negligence on the part of the indemnifying party, its officers, agents, or employees in the performance of this Agreement. STATUS. In providing the services specified in this Agreement (and any associated services) the PARTNERS are public bodies and maintain their public body status as specified in ORS 30,260. The PARTNERS understand and acknowledge that each retains all immunities and privileges granted them by the Oregon Tort Claims Act and any and all other statutory rights granted as a result of their status as local public bodies. VII. TERM AND TERMINATION The term of the Agreement is twelve months from the last date of execution, unless the STEERING COMMITTEE members unanimously agree in writing to extend that date. Any PARTNER may agree to terminate its participation in the Agreement at any time with 15-day written notice to the other PARTNERS, provided, however, that once a contract with the selected consultant has been signed, the terminating PARTNER agrees to pay its full pro-rata share of the cost of the consultant contract to MWC. 2018 COOPERATIVE AGREEMENT FOR DEVELOPING A WATER RIGHT STRATEGY FOR ACCESS TO WATER Page 14of4 In WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their proper officers on the dates noted below. Brad Taylor (Ja 5, 2019) Jan 25, 2019 an 25, 2019 Brad Taylor DATE Chris Clayton DATE General Manager City Manager Medford Water Commission City of Central Point el�lz ! ihIa Kelly Madding (Feb 22, 019) Kelly Madding City Administrator City of Ashland ��1� 4 �f_ Feb 22, 2019 ,,,,,, ,,,;,,, ,,; "Feb 22, 2019 DATE Henry Lawrence DATE City Administrator City of Eagle Point Feb 25, 2019 Jeff Alvis DATE City Administrator City of Jacksonville sandt"A saelliscy Sandra Spelliscy (Mar 18, 2019) Mar 18, 2019 Sandra Spelliscy DATE City Manager City of Talent Aaron Prunty (Mar 18, 2 9) Aaron Prunty City Manager City of Phoenix Mar 18, 2019 DATE 2018 COOPERATIVE AGREEMENT FOR DEVELOPING A WATER RIGHT STRATEGY FOR ACCESS TO WATER 17CGIS I Water Solutions, Inc. February 7, 2020 Executive Summary Water Rights Strategy for Partner Water Providers i. Introduction GSI Water Solutions, Inc. (GSI) is assisting the Partner Water Providers (Partners) to develop a water rights strategy. The Partners include the Cities of Ashland, Central Point, Eagle Point, Jacksonville, Phoenix, and Talent (jointly the Partner Cities) and Medford Water Commission (MWC).' In early 2019, the Partners signed a Cooperative Agreement to develop the strategy recognizing the benefits of mutual cooperation and the vital importance of providing source water to their respective customers for public health, safety and welfare, and for sustaining economic development. The water rights strategy focuses on the Partners' water rights and water supply associated with the MWC Duff Water Treatment Plant (Duff WTP) on the Rogue River. During the months of May through September (peak season), much of the MWC's water supply and all of the Partner Cities' water supply is treated at the Duff WTP. During this peak season period, the Partner Cities currently rely on water rights they have obtained and hold Treat and Transport agreements with the MWC. As the Partners plan for their long-term water supply needs, it is important that they have a full understanding of the status of their water rights and develop a common strategy to protect and secure them. The water rights strategy is intended to meet those needs. II. Process To develop the water rights strategy, GSI initially prepared a comprehensive water rights summary, which enabled the Partners to develop a shared understanding of the water rights at the Duff WTP. Next, GSI developed a consolidated water demand projection for each of the Partners, which included the maximum anticipated demands for the years 2030, 2040 and 2070. GSI then compared the Partners' individual and collective demands with their water rights. This evaluation showed that some of the Partners' water rights will likely provide them with sufficient supply past the year 2070, while other Partners' water rights do not provide sufficient water supply to meet current demands. The evaluation also showed that if the Partners shared their water supplies, they would have sufficient supply to meet all of their demands through 2070. I MWC's customers include customers within the City of Medford, White City, Elk City and Charlotte Ann Water Districts, as well as other customers served by MWC outside of its service area (Outside Customers). EXECUTIVE SUMMARY- WATER RIGHTS STRATEGYFOR PROJECT PARTNERS GSI WATER SOLUTIONS, INC. III. Goals, Interests and Priorities for Water Rights Strategy The above -described differences between the Partners' water rights and projected water demands demonstrate the value of a strategy related to the Partner water rights at the Duff WTP. The strategy is intended to meet the following goals, interests, and priorities: • Ensure that the water rights at the Duff WTP are strategically managed. • Secure a long-term water supply for all Partners. • Eliminate the need for Partners to unnecessarily purchase additional water rights. • Retain each Partners' ownership of its existing water rights and create opportunities to obtain value for the water rights. • Treat White City, Elk City and Charlotte Ann Water Districts, and other customers served by MWC outside of its service area (Outside Customers) equitably. IV. Strategic Management of Partners' Existing Water Rights A. Reasons for Developing Coordinated Approach to Water Rights and Water Use GSI recommends that the Partners consider developing a coordinated approach to managing their water rights and water supply. This coordination could include not only coordinated management of the water rights at the Duff WTP, but also creation of an opportunity for the Partners to share their combined water supplies. Coordination will also be necessary to strategically secure the 20 existing water rights at the Duff WTP. Additionally, if the Partners established a combined water supply, it could address the imbalances between water rights and projected water demands that have been previously described, and eliminate the need for the purchase of additional water rights to meet their individual needs. Further, establishing a combined water supply could provide the Partners with some level of supply redundancy; that is, the arrangement could enable each Partner to obtain water from more than one source of supply. B. Conceptual Framework for Water Supply Sharing GSI and the Partners considered multiple approaches to sharing water supply. Based on GSI's understanding of the Partners' goals, interests, and priorities, as well as the Partners' water supplies and demands, GSI recommended an approach that provides an opportunity to meet the Partners' near -term and long-term goals without jeopardizing any of the Partners' water rights. In addition, the Partners would pool their water rights to establish a diverse water rights portfolio. Under the recommended option, the Partner Cities and MWC would enter into an intergovernmental agreement (IGA) to work together on regional water supply. The IGA would describe how the water rights and water supply would be shared, which would occur in two phases. Until the Duff WTP capacity was expanded to 100 cfs in approximately 2028, the Partner Cities and the Outside Customers would share their water supplies. MWC could track EXECUTIVE SUMMARY- WATER RIGHTS STRATEGYFOR PROJECT PARTNERS GSI WATER SOLUTIONS, INC. each entity's water use and compare that with the entity's individual water rights to determine whether any compensation was required for use of another entity's water rights. Additionally, the Partners would follow an agreed -upon strategy to request water right certificates for their water rights. In the second phase of this option, the MWC would modify its agreements with the Partner Cities and Outside Customers and would begin to provide them with surplus water. The water rights held by the MWC and the Partner Cities would be placed into a regional water supply pool, which would be managed by the MWC. This would result in the Partners having a diverse water supply portfolio. The Partner Cities would retain ownership of their water rights, and the IGA would include a mechanism by which any of the Partner Cities could withdraw from the group. The MWC would compensate the Partner Cities for any Operation and Management (O&M) costs it incurred associated with contracts for stored water that was being used by the Partners. The MWC would also provide Partner Cities with compensation (based on negotiations between each Partner City and the MWC) for water rights used by the Partners. The rate the Partner Cities pay to the MWC would reflect these expenses. V. Summary of Recommended Option The option recommended by GSI provides an approach to meeting the Partners' near -term and long-term water supply goals without jeopardizing any of the Partners' collective water rights. In the near term, the recommended option provides a method for the Partner Cities and MWC on behalf of the Outside Customers to initiate a shared water supply strategy. It then changes relatively quickly to reset the relationship with the MWC, which would then provide surplus water supply to the Partner Cities and Outside Customers. In addition, the Partners would pool their water rights to establish a diverse water rights portfolio. Finally, this option minimizes water rights transactions, such as extensions of time for permits and transfers, and decreases the risks associated with these transactions. VI. Next Steps Establishing a water sharing agreement will require completing a series of steps or actions. The following is a brief summary of some of the actions that will be required: • The Partners' staff communicate with their councils/boards, and seek approval to develop a scope of work to develop an IGA. • Staff develop the scope of work for drafting the IGA, and take the scope of work to city councils/ board for approval. • Staff develop a draft IGA. 0 Staff take the draft IGA to their city councils/board for review and approval. Attachment 2 Water Rights Certification Strategy Table Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Water Rights Certification Strate9vTable RaIIOW (cfs) Development otal Rate in Water Right Certificate Status Deadline 71 (Cfs) Duff WTP - Existing Capacity — 70 cfs Current Status - Existing Certificates and Pending COBUs Central Point's Certificate 93754 1.13 N,A. 55.26 Central Point's Certificate 93755 1.13 N/A Eagle Point's Certificate 88552 0.90 WA Eagle Point's Certificate 89864 1.25 WA Jacksonville's Certificate 87360 No rate (400 AF) WA MWC's Certificate 86832 60.85 WA Talent's Certificate 91134 No rate (533 AF) WA Central Point's Transfer T-10465 1.20 10/1/2014 66.46 Eagle Point's TransferT-10527 0.50 10/1/2013 66.96 Phoenix's Permit S-47672 (COBU on hold)* 5.0 101112001 (71.96) Transactions Certificate Central Point's Transfer T-9900 1.846 10/1/2030 68.806 Certificate Eagle Point's Transfer T-10614 1.15 10/1/2030 69.956 Certificate Ashland's Permit S-54337* No rate (1,000 AF) 9/7/2021 69.956 Total at this capacity 69.956 cfs Duff WTP Capacity — 100 cfs in approximately 2028 Certificate Jacksonville's Permit S-54974* No rate (200 AF) 11/19/2035 69.956 cfs Certificate Talent's Permit S-53898* No rate (759 AF) 10/1/2065 69.956 cfs Certificate Phoenix's Permit S-47672 5.0 10/1/2001 74.956 Certificate Eagle Point's Transfer T-10960 1.77 10/1/2030 76.726 Certificate Eagle Point's Transfer T-12221 0.7 10/1/2030 77.426 Certificate Phoenix's Permit S52650 3.1 10/1/2030 80.526 Partially certificate MWC's Permit S54935 (estimated rate) 19.474 10/1/2056 100 Total at this capacity 100 cfs Duff WTP Capacity — 131 cfs in approximately 2036 Partially certificate MWC's Permit S-23210 31 10/1/2050 131 Total at this capacity 131 cfs Duff WTP Capacity —162 cfs (TBD) Partially certificate remainder of MWC's Permit S-23210 8.15 10/l/2050 139.15 Partially certificate MWC's Permit S54935 (estimated rate) 22.85 10/1/2056 162.0 Extend MWC's Permit S54935 as needed 10/1/2056 Total at this capacity 162.0 cfs Duff WTP Capacity —193 cfs (TBD) Certificate remainder of MWC's Permit S54935 (estimated rate) 7.676 10/1/2056 169.676 Total at this capacity 169.676 cfs Notes -These steps assume that certificating the 'volume -only" water rights would not negatively impact the ability to certificate the other Partner water rights, and all elements of seeking a certificate can be met. AF: acre-feet cfs: cubic feet per second COBU: claim of beneficial use MWC Medford Water Commission Attachment 3 Water Meters Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Meters and Information Source Documentation Water User Meter Description Source of Information Notes: Central Point BEALL MASTER MWC Data Export Central Point HOPKINS MWC Data Export Central Point VILAS MASTER 10" MWC Data Export Eagle Point AVENUE G NORTH 8" MWC Data Export Eagle Point AVENUE G SOUTH 6" MWC Data Export Eagle Point STEVENS & RILEY 4" MWC Data Export Eagle Point VISTA POINTE #1 MWC Data Export Eagle Point VISTA POINTE #2 MWC Data Export Jacksonville MADRONE/OAKGROVE 6" MWC Data Export Phoenix MWC Garfield St and Kings Avenue Meter MWC Data Export Phoenix has two connections to the MWC system, one direct connection at Garfield and Kings and the connection via TAP. This is the direct connection. Phoenix TAP TAP Master Meter on Samike Drive less Talent Meter RVCOG Monthly Utility Billing Data Phoenix TAP usage is the equal to the total from the TAP master meter at Samike, less what is measured at the Talent Meter on the TAP line. Talent Talent Meter at intersection Bear Creek Drive and Main Street in Phoenix less Ashland usage RVCOG Monthly Utility Billing Data Talent usage is the total of the Talent meter, less measured Ashland usage. Ashland lCreel Road and Highway 97 RVCOG Monthly Utility Billing Data Attachment 4 Participating Partner Cities' Authorized Water Volumes ......................................................................................................................................................................................................................................... . Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Partner Cities' Authorized Water Volumes Water Right Authorized Water Volume From Water Right (acre-feet) Calculated from Rate (acre-feet) Total Authorized Water Volume (acre-feet) Ashland Permit S-54337 1,000 Total 1,000 1,000 Central Point Transfer T-9900 666.0 Certificate 93754 412.4 Certificate 93755 412.4 Transfer T-10465 438.0 Total 1,104.0 824.8 1,928.8 Eagle Point Certificate 88552 321.3 Transfer T-10527 181.5 Transfer T-10614 273.7 Transfer T-10960 520.3 Certificate 89864 356.94 Transfer T-12221 207.2 Total 1,860.94 1,860.94 Jacksonville Certificate 87360 400.0 Permit S-54974 200.0 Total 600 600 Phoenix Permit S-47673 400 Permit S-52650 600 Total 1,000 1,000 Talent Permit S-53898 759.0 Certificate 91134 533.0 Total 1,292 1,292 Partner Cities' Authorized Water Volumes 6,856.94 824.8 7,681.74 Attachment 5 Example Allocation of Excess Water Use Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Example Allocation of Excess Water Use: Four cities hold water rights and use water as follows. Medford Water would calculate excess water use and unused water rights as shown in the column labeled "difference" City Water Rights Water Use A Difference A City A 500 1,490 -990 (excess water use) City B 1,000 750 250 unused water rights) City C 1,500 1,000 500 (unused water rights) City D 2,000 1,000 1,000 (unused water rights) Medford Water would calculate the compensation that City A (the only City with excess water use) would need to provide to Cities B, C and D (who had unused water rights) as follows: o Total excess use - 990 AF o Cities B, C, D -each compensated for 250 AF (up to maximum of City B's water rights), which accounts for 750 AF o Remaining excess use - 240 AF o Cities C and D - each compensated for 120 AF (for a total of 370 AF each) Attachment 6 Example Calculation of Average Annual Cost per Acre -Foot Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Table 1: Example Calculation of Total Annual O&M Costs for Storage Space (See VII.B.1. in IGA) Name Application Permit Contracted Storage Space (AF) Total O&M Cost (2020) Ashland S-85733 S-54377 1000 $9,653.00 Jacksonville S-80641 S-53445 400 $14,479.50 Jacksonville S-88088 S-54974 200 $9,653.00 Phoenix S-60890 S-47672 400 $24,132.50 Phoenix S-71996 S-52650 600 $31,179.19 Talent S-84029 S-53898 759 $4,826.50 Totals 3,892 $93,923.69 Table 2: Example Calculation of Total RR&R Costs for Storage Space (See VII.B.2. in IGA) Name Application Permit Contracted Storage Space (AF) Total RR&R Cost (2020) Ashland S-85733 S-54377 1000 $0 Jacksonville S-80641 S-53445 400 $0 Jacksonville S-88088 S-54974 200 $0 Phoenix S-60890 S-47672 400 $0 Phoenix S-71996 S-52650 600 $0 Talent S-84029 S-53898 759 $0 Totals 3,892 $0 Table 3: Example Calculation of 5-year Rolling Average RR&R Cost (See VII.B.3. in IGA) Year RR&R Cost 2016 $0.00 2017 $0.00 2018 $0.00 2019 $0.00 2020 $0.00 Total $0.00 5-year Rolling Average (Divide Total by 5) $0.00 Table 4: Example Calculation of Total Annual Assessment Costs (See VII.B.4. in IGA) Holder Type of Right Certificate Transfer Maximum Rate ( Maximum Volume (AF) Period of Use Volume Associated with Irrigation Districts (AF) Annual Assessment Costs (2020) Central Point Non -District T-9900 1.846 666 1-Apr 1-Nov N/A - Non- District Water Right N/A - Non - District Water Right Central Point Non -District Central Point Non -District Central Point Non -District Central Point District 93754 1.13 1-Apr 1-Oct 412.4 Central Point District 93755 1.13 1-Apr 1-Oct 412.4 Central Point District T-10465 1.2 447.6 1-Apr 1-Oct 438.0 $30,677.22 Central Point District Central Point District Central Point District Central Point District Eagle Point District 88552 0.9 321.3 1-Apr 31-Oct 321.3 Eagle Point District T-10527 0.5 181.5 1-Apr 31-Oct 181.5 Eagle Point District T-10614 1.15 273.7 1-Apr 31-Oct 273.7 Eagle Point District T-10960 1.77 520.3 1-Apr 1-Oct 520.3 $40,800.00 Eagle Point District 1-Apr 31-Oct Eagle Point District 89864 1.25 356.94 1-Apr 31-Oct 356.94 Eagle Point District T-12221 0.7 207.2 1-Apr 1-Oct 207.2 Eagle Point District 1-Apr 31-Oct Totals 3,123.7 $71,477.22 Table 5: Example Calculation of Average Annual Cost Per Acre Foot (See VII.B.S. and VII.C. in IGA) Annual Water Volumes Costs (2020) associated with the Costs (AF) Total Annual O&M Cost For $93 ,923.69 Storage Space 3,892 5-Year Rolling Average RR&R Cost $0.00 for Storage Space Total Annual Assessment Cost from $71,477.22 3,123.7 Irrigation Districts Totals 1 $165,400.91 7,015.70 Annual Average Cost Per Acre Foot: (Divide Total Annual Cost by the Total Water $23.58 Volume Associated with the Costs) Attachment 7 Example Annual Summary Report of Water Sharing Agreement Intergovernmental Agreement for a Coordinated Water Rights Management and Water Sharing Plan Table 1: Example - Volume of Water Use, Water Purchased, and Water Sold Volume of Authorized Water Authorized Annual Excess Use/ Volume Water Metered Excess Water Remaining After Volume Volume Water Right Water Volume Volume Sold Purchase/Sale Partner City (AF/season) (AF) Volume (AF) Purchased (AF) (AF) (AF) Central Point 1928.8 2023.1 -94.4 94.4 0.0 0.0 Eagle Point 1860.9 1050.5 810.5 0.0 18.9 791.6 Ashland 1000.0 0.0 1000.0 0.0 18.9 981.1 Jacksonville 600.0 529.4 70.6 0.0 18.9 51.7 Phoenix 1000.0 540.5 459.5 0.0 18.9 440.7 Talent 1292.0 559.3 732.7 0.0 18.9 713.9 Table 2: Example - Total Cost Paid and Received by each Partner City Average Annual Cost ($/AF) Water Volume Purchased (AF) Total Paid ($) Water Volume Sold (AF) Total Received ($) Central Point $23.58 94.4 $2,225.13 0.0 $0.00 Eagle Point $23.58 0.0 $0.00 18.9 $445.03 Ashland $23.58 0.0 $0.00 18.9 $445.03 Jacksonville $23.58 0.0 $0.00 18.9 $445.03 Phoenix $23.58 0.0 $0.00 18.9 $445.03 Talent $23.58 0.0 $0.00 18.9 $445.03 Total 94.4 $2,225.13 94.4 $2,225.13 Table 3: Example - Matrix of Costs Paid by and to Each Partner City Receives Central Point Eagle Point Ashland Jacksonville Phoenix Talent Total Paid Central Point $445.03 $445.03 $445.03 $445.03 $445.03 $2,225.13 Eagle Point $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Ashland $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 M a Jacksonville $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Phoenix $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Talent $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 Total Received $0.00 $445.03 $445.03 $445.03 $445.03 $445.03 Coordinated Water Rights Management and Water Sharing Plan A strategic approach to water management September 30, 2021 Water is a precious but limited resource in Southern Oregon. Because of this, the Cities of Ashland, Central Point, Eagle Point, Jacksonville, Phoenix, and Talent —collectively referred to as the Partner Cities —and the Medford Water Commission have come together to protect and ensure access to this vital resource. Why is this partnership needed? The Partner Cities hold numerous water rights that authorize the diversion of water at the Medford Water Commission's Duff Water Treatment Plant (WTP). Because of the complications associated with managing multiple water rights at a single point of diversion, the Partner Cities and Medford Water must work together to manage these water rights to ensure they are protected. This alliance also allows for the sharing of water supplies. Water sharing eliminates the need for some Partner Cities to obtain new water rights, which would only further complicate water rights management. Ultimately, the partnership's efforts will help diversify the region's water supply portfolio, increase the long-term reliability of the water supplies, and provide additional tools for managing through water shortages and drought. What is the background of the partnership? The Partner Cities and Medford Water entered into a cooperative agreement for developing a water rights strategy in zosg, and in February 2020, identified a recommended approach. The recommended approach includes two elements (1) water rights certification coordination, and (2) a water -sharing plan. How does water sharing work? Under the water -sharing plan framework, the Partner Cities would retain ownership and control of their water rights, and continue to use water under their own water rights from May i through September 3o each year. At the end of each year, Medford Water would compare each city's water use to the volume of water authorized by its water rights. Any Partner Cities that used more water than authorized by their water rights would provide compensation to the other Partner Cities for use of water under their rights. What are the next steps? Staff from Medford Water and the Partner Cities have been meeting to develop an Intergovernmental Agreement (IGA) for establishing the Coordinated Water Rights Management and Water Sharing Plan. Staff will continue to keep their Boards and Councils updated and in the near future will bring the IGA to decision makers for their review. G1�-� OF pHO"-,�-f - AEGO O•R•E•G•O•N ! Ak /r, �,.. o� CENTRAL ASHLAND POINT -r: 1 O- c 9 1 � Council Study Session July 18, 2022 Agenda Item Review and Discussion of Imperatrice Property Lease From Joseph Lessard City Manager Contact 0oe.1essare(cD-ashland.or.us; 541-552-2103 Item Type Requested by Council ® Update ❑ Request for Direction ❑ Presentation ❑ SUMMARY At the Request of Mayor Akins, a review and discussion of the lease of the City's Imperatrice Property to the Land Manatee Foundation (LMF) has been placed on the City Council's Study Session agenda. The lease was approved by the City Council at the February 18, 2020 Business Meeting Minutes, Staff Report). The Imperatrice Property was purchased by the City of Ashland for $950,288 in 1996 with Food and Beverage Tax funds. The purchase was for use of the property as a wastewater effluent disposal site. The site is no longer needed to support any wastewater related treatment options based on decisions made over the past decade. During the recent Special Called Meetings of May 23-24 and June 14 of this year, an informal vote of the City Council identified possible future uses of the property for open space, trails and/or a solar farm. Currently the property is leased to LMF for cattle grazing with FY 2022-23 leaser revenue to the City of $1.00 per annum. In addition, the lessee covers additional costs associated with the leased tax lots, reference section 3.2 of attachment #1. The lease includes the following cancellation clause, reference section 2.2 of attachment #1. Either party may terminate the lease with 30 days written notice to the other party. REFERENCES & ATTACHMENTS Attachment #1: Property lease of the Imperatrice Property to the Land Manatee Foundation Page 1 of 1 CITY OF -ASHLAND CITY OF ASHLAND GROUND LEASE AGREEMENT FOR RANCHING AND SUSTAINABLE FARMING THIS AGREEMENT ("Lease") is entered into between the CITY OF ASHLAND, OREGON ("City) , and Land Manatee Foundation (LMF), ("Lessee"). RECITALS A. City owns property commonly known as the Imperatrice Property. The portion of the Property which is the subject of this Lease is described below and in attached Exhibit A and is hereinafter referenced as "the Premises". B. Lessee desires to lease the Premises for purposes of operating a restorative and regenerative ranch for cattle and horses in accordance with Lessee's proposal in response to the City's Request for Proposal (RFP) Project 2019-29, Beneficial Use and Lease of the City's "Imperatrice" Property. Lessee's proposal is attached as Exhibit B, and its provisions are fully incorporated herein as enforceable terms of this Lease. C. City desires to lease the Premises described in Exhibit A to Lessee under the circumstances set forth in this Lease. AGREEMENTS In consideration of the matters described above, and of the mutual benefits and obligations set forth in this Lease, the parties agree as follows: Description of Leased Property. The Premises subject to this Lease and described in Exhibit A comprise approximately 265 pastoral irrigatable acres and are encumbered by numerous easements and title exceptions as shown in the RFP attached as part of Exhibit B. Lessee will use Premises to operate a restorative and regenerative ranch for cattle and horses according to Lessee's proposal in Exhibit B. The Premises are further limited in their use by Lessee as follows: • 38 1 E 32 — TL 100 (3.17 acres: access only) • 38 1 E 32 — TL 200 (65.88 acres: this tax lot is to the south and west of the Talent Irrigation District (TID) canal) — in total • 38 1 E 33 — TL 200 (total tax lot is 406.86 acres: lease includes approximately 200 acres south of TID canal) — the entire lot may be used with appropriate fencing along the TID canal approved by the City in consultation with TID. Access: City provides access across the southern line of the following City owned tax lots for the purposes of moving livestock from the adjacent property to the Premises: 381 E28 TL 500, 381 E28 TL 600 and 381 E27 TL 100. 1.1.1 City understands that Lessee has rights to trespass on the adjacent property 381 E34 TL 100. However, should disputes arise, the City will not substantiate or have any interest in such disputes. 2. Term. The original term of this Lease shall be for 2 years, commencing on February 15, 2020 and ending on February 14, 2022. CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 1 of 10 2.1. Option to Renew. Lessee shall have the option to renew this lease for up to 3 successive terms of one year each, as follows: 2.1.1. Each renewal term shall commence on the day following expiration of the preceding term. 2.1.2. The option shall be deemed exercised by Lessee, unless Lessee gives City written notice not less than 180 days prior to the last day of the expiring term stating that the option will not be exercised. The giving of such notice shall be sufficient to terminate the Lease at the end of the expiring term without further act of the parties. 2.1.3. The terms and conditions of the Lease for each renewal term shall be identical with the original term, except for the number of renewal options then remaining. 2.2. Terminate. Either party may terminate this lease at any time upon 30 days prior written notice to the other party. 3. Lease Fees. 3.1. Rent. Lessee agrees to pay to City rent in the amount of $1.00 per year plus quarterly reimbursement for all City -incurred fees and assessments associated with the Premises, as described in 3.2. The City will deliver a quarterly rent bill to Lessee at the beginning of the quarter. Lessee agrees to promptly pay the City the full amount shown in each quarterly rent bill. 3.2. City -Incurred Fees. The City will pay the following fees and assessments, plus any mandated subsequent increases, with the understanding that Lessee will fully reimburse these payments, as prescribed in 3.1 and 3.3. 3.2.1. Talent Irrigation District (TID) Annual Assessment (2019 assessment was $9,711.4); 3.2.2. Oregon Department of Forestry Fire Protection Fee (2019 assessment was $1,787.92); and 3.2.3. Jackson County Property Tax (2019 assessment was $897.35). 3.2.4. City will provide notice of cost increases from said agencies as those charges are paid (typically by the October quarterly lease/rent fee). 3.2.5. For planning purposes, total incurred 2019 costs were $12,396.67; so quarterly payments would be $3,099.17 plus $1.00. 3.3. Rent Due Dates. Rent shall be due quarterly at the beginning of the quarter on January 1; April 1; July 1; and October 1; and become past due ten days past the due date. Interest on past due rent shall be1.5% per month. The first quarterly payment will be prorated based upon the final agreement date. 3.4. Security Deposit. [Not Applicable]. 4. Maintenance. Lessee shall keep and maintain the Premises and all improvements in good and substantial repair and condition, including the exterior condition of improvements. 4.1. Repairs. Lessee shall make all necessary repairs and alterations and shall maintain the Premises and all improvements in compliance with all applicable building and zoning laws and all other laws, ordinances, orders and published requirements of public agencies. 4.2. Maintain. Lessee shall keep and maintain all fences which are currently upon the Premises or which may be erected while the Lease is in effect, in a visually appropriate manner, and in good condition and repair to effectively serve their purposes. 4.3. Free from debris. Lessee shall provide proper containers for trash and garbage and shall keep the Premises free and clear of weeds, rubbish, debris, and litter at all times. 4.4. Inspections. City shall have the right to conduct reasonable inspections and investigations of the Premises and the operations conducted on the Premises at any time, and from time to time with reasonable advance notice, and Lessee shall cooperate fully with City during such inspections and investigations. CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 2 of 10 4.4.1 Lessee shall make arrangements for an annual site visit in coordination with the City and TID ditch rider to ensure Lessee is maintaining appropriate TID canal conditions. 5. Alterations. Lessee shall have the right to erect, maintain, and alter such facilities as fencing and irrigation systems upon the Premises provided such facilities conform to the applicable requirements of all federal, state, and local laws. Prior to construction of such facilities or improvements on the Premises, the detailed plans for them must have been reviewed and approved in writing by the City, which approval shall not be unreasonably withheld. Absent such approvals or any necessary land use approvals, all use of the Premises must cease immediately. Lessee shall be solely responsible for all material and labor costs of any alteration of the Premises. 6. Land Use Approvals Required. This Lease is not a land use approval. Lessee is not the City's agent, and City is not the Lessee's agent for purposes of any contracts or commitments made by either party. Lessee acknowledges and agrees that future preliminary and/or final approvals, including plans, plan amendments, plan modifications, civil plans (construction plan approvals), construction permits and building permits are subject to compliance with all applicable approved plans, approval conditions and applicable land development regulations in effect at the time the approvals are sought. No rights to obtain preliminary and/or final approvals, including plans, plan amendments, plan modifications, or building permits, nor any other rights to develop and/or construct on Premises have been granted or implied simply by the City's approval of this Lease. Lessee must fully comply with all approved plans, approval conditions and applicable laws in effect at the time the final approvals are sought. Lessee, or its successors and assigns, may not attempt to force, coerce or intimidate the City to approve final plans or grant other construction authorizations, including building permits, by asserting that the City has committed to such approvals for construction on any parcel within the Premises based on the theory of vested rights, equitable estoppel, or any other legal theory based on the City's approval of this Lease or any associated agreement. This Lease does not grant Lessee the right to move or construct anything on any parcel other than the Premises. City approval of final plans and/or construction orders requires strict compliance with applicable planning procedures, approval conditions and the applicable criterion for approval. 7. Ownership and Removal of Alterations. Upon completion of any construction and final structural inspection thereof, Lessee improvements included in any planning action, including any further improvements to the Premises approved by any other authority, shall become and remain property of Lessee. Lessee shall remove any such improvements before termination of the Lease. Lessee shall at all times be and remain the honorable fixtures, trade fixtures and personal property brought on the Premises and shall have the right to remove all such items at the end of the term of this Lease. 8. Rights Reserved to the City. The City reserves the following rights: 8.1. Improve Premises. The right to develop or improve the Premises without interference or hindrance of the Lessee. 8.2. Maintain Premises. The right, but not the obligation, to maintain and keep the Premises in good repair, together with the right to direct and control all activities of Lessee not in conformance with the Lease. 8.3. Protect Premises. The right to take any action considered necessary to protect the Premises from waste or nuisance, together with the right to prevent Lessee from erecting, or permitting to be erected, any building or other structure on the Premises which, in the opinion of the City, would limit the usefulness of the Premises or constitute a hazard. CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 3 of 10 8.4. Temporary Closures. The right to temporarily close or to restrict the use of the Premises or any of the facilities for maintenance, improvement, or for the safety of the public. Lessee is entitled to full abatement of rent during such temporary closures. 9. Non -appropriations; No Agency. The City and Lessee are entering into this Lease voluntarily in the spirit of cooperation and coordination to facilitate Lessee's desire to lease the Premises for purposes set forth in Exhibit B. However, nothing in this Lease makes the City responsible for the contracts or commitments of Lessee regarding development to achieve Lessee's desired outcome. Lessee is not subject to public contracting rules and regulations, and nothing herein makes Lessee subject to such public agency procurement requirements. 9.1. All City obligations pursuant to this Lease which require the expenditure of funds are contingent upon future appropriations by the City as part of the local budget process. Nothing in this Lease implies an obligation on the City to appropriate any such monies. 10. Lessee Obligations 10.1. Commercial activities permitted. Lessee may conduct any approved and related commercial activities upon obtaining a business license, as specified in the City of Ashland Ordinances. 10.2. Utilities. Lessee shall promptly pay any charges for electricity, water and sewer, and all other charges for utilities which may be furnished to the Premises at Lessee's order or consent. 10.3. Fencing. Lessee will act with City to install fencing in a manner that separates or divides the Premises in a manner that protects canals and irrigation facilities from encroachment and damage by livestock. Fencing shall in no way restrict the use of the access way along the irrigation canal. 10.4. Liens, Taxes. Lessee shall pay all sums of money that become due for any labor, services, materials, supplies, utilities, furnishings, machinery or equipment which have been furnished or ordered by Lessee which may be secured by lien against the Premises. Lessee shall pay all real and personal property taxes assessed against the Premises, such payments to be made no later than November 15 of the year in which the taxes become due and payable. 10.5. Compliance with laws. Lessee shall comply with all federal, state, county, and city laws, orders and ordinances; 10.5.1. Local Laws. The terms, restrictions and requirements of approvals are set forth in the applicable County and State statutes and regulations, the preliminary and final approvals, and this Lease. All local development approvals and permits identified by local law or this Lease shall be obtained at the sole cost of the Lessee. The failure of this Lease to address a particular permit, condition, term or restriction shall not relieve Lessee of the duty to comply with any laws governing permitting requirements, conditions, terms or restrictions. 10.6. Marijuana Grow Prohibited. Lessee is not permitted to grow or cultivate on the Premises any forms of commonly used marijuana, cannabis, or cannabinoid substances as defined under Federal or State law such as, but not limited to, marijuana or industrial hemp as defined under ORS 571.300. 10.7. Lessee's Specific Compliance with Environmental Laws. As used in this paragraph, the term "hazardous material" means any hazardous or toxic substance, material, or waste, including, but not limited to, those substances, materials, and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 C.F.R. § 172.101) or by the United States Environmental Protection Agency as hazardous substances (40 C.F.R. Part 302) and any amendments, ORS 466.567, 466.205, 466.640 and 468.790 and regulations of the Oregon State Department of Environmental Quality, petroleum products and their derivatives, and such other substances, materials and wastes as become regulated or subject to cleanup authority under any environmental laws. Environmental laws mean any federal, state, or local statutes, regulations, or ordinances or any judicial or other governmental orders pertaining to the protection of health, safety, or the environment. CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 4 of 10 10.7.1. Lessee's Compliance with Laws and Permits. Lessee shall cause the Premises and all operations conducted on the Premises (including operations by any subtenants) to comply with all environmental laws. 10.7.2. Flammables and Explosives Prohibited. Lessee shall not store any flammable or explosive liquids or solids within the Premises without a permit. For the purpose of this rental agreement, "flammable or explosive liquids or solids" shall not apply to fuel or other flammables contained within any vehicle used or stored at the Premises. Fueling of vehicles while in any enclosed storage facility is strictly prohibited. 10.7.3. Limitation on Uses of Hazardous Materials. Lessee shall not use or allow any agents, contractors or subtenants to use the Premises to generate, manufacture, refine, transport, treat, store, handle, recycle, release or dispose of any hazardous materials, other than as reasonably necessary for the operation of Lessee's activities as contemplated under this lease. 10.7.4. Disposal and Contamination Clean-up. Lessee shall be responsible for disposing of all hazardous materials in compliance with environmental laws, and Lessee shall be responsible for any environmental clean-up of the Premises that is necessary due to Lessee's activities. Lessee shall not be responsible for any environmental cleanup of the Premises resulting from activities not authorized by the Lessee such as trespass or pre- existing contamination. 10.8. Specific Obligations; Bi-Annual Reporting. Lessee shall provide a report two times a year in January and July on the number and type of livestock grazing on the Premises; the general agricultural improvements made; general restoration processes; and any educational opportunities provided for the previous quarter. Reports may be made to Michael Morrison, Public Works Superintendent at michael.morrison@ashland.or.us. 11. Damage or Destruction of Premises. Lessee shall be responsible for damage or destruction to the Premises or any improvements resulting from Lessee's operations, or anything done or permitted by Lessee under this Lease. If the Premises or any improvements thereon are damaged or destroyed by fire or other casualty as a result of activities by Lessee, 11.1. Lessee shall: 11.1.1. Promptly repair, rebuild or restore the property damaged or destroyed to substantially the same condition consistent with the applicable building codes; and 11.1.2. Apply for any net proceeds of insurance resulting from claims for such losses, as well as any additional money of Lessee necessary. 11.2. If the damage or destruction which occurs is such that the cost of repair, rebuilding or restoration of the property damaged or destroyed exceeds 50% of the fair market value of the improvements, Lessee shall have the option within 60 days from the date of damage or destruction, to notify City in writing whether or not Lessee elects to repair, rebuild, or restore in as provided in this section or to terminate this Lease. Upon giving such notice to terminate, this Lease shall terminate on the date specified in the notice, and City shall be entitled to the net proceeds of insurance. 12. Insurance. Lessee shall obtain and maintain continuously in effect at all times during the term of this Lease, at Lessee's sole expense, the following insurance: 12.1. Worker's Compensation Insurance in compliance with ORS 656.017, which requires subject employers to provide Oregon workers' compensation coverage for all their subject workers. Lessee certifies in attached Exhibit C its compliance with state workers' compensation coverage requirements during the term of this Lease. 12.2. General Liability Insurance with a combined single limit, or the equivalent, of not less than $2,000,000 per occurrence for bodily injury and property damage. It shall include contractual liability coverage for the indemnity provided under the Lease. CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 5 of 10 12.3. Automobile Liability Insurance with a combined single limit, or the equivalent, of not less than $1,000,000 per occurrence for each accident for bodily injury and property damage, including coverage for owned, hired or non -owned vehicles, as applicable. 12.4. Notice of Cancellation or Change. There shall be no cancellation, material change, reduction of limits or intent not to renew the insurance coverage(s) without 30 days' written notice from the contractor or its insurer(s) to the City. 13. Indemnification; Waiver of Subrogation. Lessee will defend, indemnify and save City, its officers, employees and agents harmless from any and all losses, claims, actions, costs, expenses, judgments, subrogations, or other damages resulting from injury to any person (including injury resulting in death,) or damage (including loss or destruction) to property, of whatsoever nature arising out of or incident to this Lease or the activities that take place on the Premises. Lessee waives the right of subrogation regarding the insurance policy as described in the Insurance Section in this Lease. Lessee will not be held responsible for damages caused by negligence of City. 14. Default 14.1. Events of Default. The following shall be events of default: 14.1.1. Default in Rent: Failure of Lessee to pay any rent or other charge within ten days after it is due. 14.1.2. Default in Other Covenants: Failure of Lessee to comply with any covenant, term or condition, or to fulfill any obligation of the Lease (other than the payment of rent or other charges) within 30 days after written notice by City specifying the nature of the default. If the default is such that it cannot be completely remedied within the 30-day period, this provision shall be complied with if Lessee begins correction of the default within the 30- day period and proceeds in good faith to effect the remedy as soon as practicable. 14.1.3. Insolvency: Insolvency of Lessee and assignment by Lessee for the benefit of creditors; the filing by Lessee of a voluntary petition in bankruptcy; an adjudication that Lessee is bankrupt or the appointment of a receiver of the properties of Lessee; the filing of an involuntary petition of bankruptcy and failure of the Lessee to secure a dismissal of the petition within 30 days after filing; attachment of or the levying of execution on the leasehold interest and failure of the Lessee to secure discharge of the attachment or release of the levy of execution within ten days. 14.2. Remedies on Default. In the event of a default, the City at its option may terminate the Lease by notice in writing by certified or registered mail to Lessee. The notice may be given before or within thirty days after the running of the grace period for default and may be included in a notice of failure of compliance. If the Premises are abandoned by Lessee in connection with a default, termination shall be automatic and without notice. 14.3. Damages. In the event of termination by default, City shall be entitled to recover immediately the following amounts as damages: 14.3.1. The reasonable cost of re-entry and releasing including the cost of any clean up, refurbishing, removal of Lessee's property and fixtures, or any other expense occasioned by Lessee's failure to quit the Premises upon termination and to leave the Premises in the required condition, any remodeling costs, attorney fees, court costs, broker commissions and advertising cost. 14.3.2. The loss of reasonable lease fee value from the date of default until a new tenant has been or, with the exercise of reasonable efforts could have been secured. 14.4. Re -Entry After Termination. If the Lease is terminated for any reason, Lessee's liability to City for damages shall survive such termination, and the rights and obligations of the parties shall be as follows: 14.4.1. Lessee shall vacate the premises immediately, and within thirty (30) days, remove any property of Lessee including any fixtures which Lessee is required to remove at the end of CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 6 of 10 the lease term, perform any cleanup, alterations or other work required to leave the Premises in the condition required at the end of the term. City may re-enter, take possession of the Premises and remove any persons or property by legal action or by self- help with the use of reasonable force and without liability for damages. 15. Assignment of Interest or Rights. Without prior written approval, neither Lessee or any assignee or other successor of Lessee shall sublease, assign, transfer or encumber any of Lessee's rights in and to this lease or any interest, nor license or permit the use of the rights granted except as provided in this paragraph. Lessee shall not assign all or any part of its rights and interests under this Lease to any successor through merger, consolidation, or voluntary sale or transfer of substantially all of its assets, without prior written approval of the City. Written approval of the City shall not be unreasonably withheld. 16. Condemnation. If any legally, constituted authority condemns the Premises or such part thereof which shall make the Premises unsuitable for leasing, this Lease shall cease when the public authority takes possession, and Landlord and Tenant shall account for rental as of that date. Lessee shall not have any rights in or to any award made to City by the condemning authority and further waives any action or remedy to recover compensation against the condemning authority for any loss or damage caused by the condemnation. 17. General Provisions. 17.1. No Partnership or Joint Venture. Nothing in this Lease shall be construed to render the City in any way or for any purpose a partner, joint venturer, or associate in any relationship with Lessee other than that of Lessor and Lessee nor shall this Lease be construed to authorize either party to act as agent for the other. 17.2. Nonwaiver. Waiver by either party of strict performance of any provision of this Lease shall not be a waiver of or prejudice the party's right to require strict performance of the same provision in the future or of any other provision. 17.3. Consent of City. Whenever consent, approval or direction by the City is required, all such consent, approval or direction shall be received in writing from the City Administrator. 17.4. Notices. All notices required under this Lease shall be deemed to be properly served if sent by certified or registered mail to the last address previously furnished by the parties. Until changed by the parties by notice in writing, notices shall be sent to: CITY: City of Ashland Attn: Public Works Superintendent 20 Main Street Ashland, OR 97520 LESSEE: Land Manatee Foundation (LMF) Attn: Renee L. De Launay PO Box 3373 Ashland, OR 97520 17.5. Governing Law. This Lease and all matters relating to this Lease shall be governed by the laws of the State of Oregon in force at the time any need for interpretation of this Lease or any decision or holding concerning this Lease arises. 17.6. Extraterritorial Regulation. Nothing in this Lease shall interfere with the legislative authority of City under ORS 226.010 or any other provision of state law. 17.7. Binding on Successors. This Lease shall be binding on and shall inure to the benefit of the heirs executors administrators successors and assigns of the parties hereto. 17.8. Entry for Inspection. City shall have the right to enter on the Premises at any time to determine Lessee's compliance with this Lease or to make necessary repairs to the Premises whether or not such inspection is made the duty of City to make repairs shall not mature until a reasonable CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 7 of 10 time after City has received written notice from Lessee of the repairs that are required. In addition, City shall have the right at any time during the last twelve months of the term of this Lease to place and maintain on the Premises notices for leasing or selling of the Premises. 17.9. Holdover by Lessee. If the Lessee does not vacate the Premises at the time required, the City shall have the option to treat the Lessee as a Lessee from month to month subject to all provisions of this Lease except the provision for term. 17.10.Severability. If any provision of this Lease is held by a court of competent jurisdiction to be either invalid void or unenforceable the remaining provisions of this Lease shall remain in full force and effect unimpaired by the holding. 17.11. Entire Agreement. This Lease and its attachments constitute the sole and only agreement between City and Lessee respecting the leasing of the Premises to Lessee. Any agreements or representations respecting the Premises their leasing to Lessee by City or any other matter discussed in this Lease not expressly set forth or incorporated into this Lease are null and void. INTENDING TO BE BOUND, the parties have executed this Lease as of the date written below. LESSEE: Renee L. De Launay, Land Manatee Foundation Date ORDER Pursuant to ORS 271.360 the governing body hereby approves and authorizes the terms of this lease as set forth above. CITY: City Administrator, City of Ashland Date CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 8 of 10 EXHIBIT A LAND LEASE PROPERTY DESCRIPTION -- "THE PREMISES" City of Ashland Ground Lease Agreement Property. "The Premises" is shown in red dashed lines and includes 381E32 TL400, all of 381E32 TL2oo and a portion of 381E33 TL200. Area north of TID canal in 38 tE 33 TL200 may be utilized with approved fencing (see agreement). Note: all lines are shown for reference, not actual tax lots The property within the leased Premises is comprised of three separate tax lots which are described in further detail and includes data from the Jackson County Assessor's Office: Jackson County Map Reference: 38 1E 32 Tax Lot 200 38 1E 33 Tax Lot 200 Address Location: Approximately 2 miles North of Ashland. This parcel of four tax lots lays adjacent to the Northeast side of Interstate 5 and the associated "Northbound" 1-5 weigh station. This property extends uphill in a Northeasterly direction across the east canal of the TID. Owner of Record: City of Ashland Assessor's Account No: 38 1E 32 Tax Lot 200 1-012688-4 38 1E 33 Tax Lot 200 1-012367-6 Present Use: 224.4 acre irrigated pasture* 423.95 acre dry pasture Zone: EFU Size: 648.35 acres TOTAL CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 9 of 10 Jackson County Map Reference: 38 1E 32 Tax Lot 100 Address Location: Approximately 2 miles North of Ashland adjacent to both sides of Butler Creek Road. This property is approximately 200-300 feet North of Interstate 5. Owner of Record: City of Ashland Assessor's Account No: 1-012687-6 Present Use: dry pasture and access Zone: EFU Size: 3.17 acres CITY IF ASHLAND GROUND LEASE AGREEMENT 2019-29 Page 10 of 10 I of 4 Proposal to the City of Ashland, Oregon, Public Works/Engineering Division Beneficial Use and lease of the City's "Imperatrice" Property Section 1 Specific Proposal Requirements, Description of RFP and Property Description Project No: 2019-29 Project Type: Property Lease Project Duration: 24 months (3.2.9 Period Of Use Recognition) City Project Manager: Mike Morrison Public Works Director: Paula C. Brown Attachments not included in 4 page limit: Addendum No. 1, Exhibit C, Proposer Info, IRS Determination and EIN, Attachments No. 1-No.4, LMF Conservation Ranching Program/ Protocols and LMF one page Estimated Business Plan for Property. LMF Synopsis and LMF Bi- laws available upon request. Proposer acknowledges the City of Ashland's rights to cancel this procurement or reject any and all proposals in accordance with ORS 279B.100. The applicant understands that a lease agreement will be designed to match the specific proposal that is awarded the property lease. If awarded the lease, Land Manatee Foundation ("LMF") will be available to participate in the City of Ashland processes. The property description to be leased to the accepted proposer is a tract of land located in Jackson County Oregon and is more fully described as follows. All that portion of the following listed tax lots which lie southerly and westerly of the Talent Irrigation East Lateral Ditch: 1: 38 1 E 32 tax lot 100 (exempting Property west of Butler Creek Road) 2: 38 1E 32 tax lot 200 (behind Port of Entry) 3: 38 lE 33 tax lot 200 (facing Ashland as viewable inrigated/dry-land grasslands) Containing 265 pastoral irrigate -able acres more or less. (3.2.10 Limits of Use) Containing 424 acres of dry land more or less. Accepting all legal encumbrances, right of ways, current as well as future easements and existing biological sensitivities. (Recognition of 3.2.1-3.2.8) The subject area susceptible to project proposer's operation consists of primarily 265 pastoral irrigatablel acres. Prelude This proposal is hereby submitted by LMF in response to the City of Ashland RFP for the Beneficial Use of the "Imperatrice" Property, Project No. 2019-29 Distributed on November 22,2019. "Irrigatable in this proposal references the RFP 1.1.3 present uses calculations; 3.2.3 TID water availability 4.64 acre feet per acre. 2 of 4 The applicant has examined the subject RFP and hereby acknowledges all details and provisions of the City's proposal process. Proposed Beneficial Use of the "Imperatrice" Property Approach, Environmental Stewardship,. Public Benefit, Sustainability Experience and Supporting Plan Success LMF is a 5016 organization registered with the Federal Government under section 501(c)(3) of Title 26 of the United States Code. Its Internal Revenue Service (IRS) Determination Letter is attached as well as the corresponding tax-exempt charitable organization Employer Identification Number 83-2612886 [CP-575] is in compliance with Federal, State and all local County Laws. The mission of LMF is to lead by exemplary example in communities in the exercise of ranching conservation by encompassing regenerative agriculture, holistic environmental sustainability and land/livestock based education (supplying the community with 4H Horses, FFA partnerships, and Youth Programs), including preseivation and knowledge of heritage culture land uses, wildlife balance and spring development. LMF is proposing to use the "Imperatrice" property as a living history -designed ranching conservation program by revitalizing the glory of the land usages in an environmentally sustainable method using integrated authentic traditions to preserve past ranching culture. LMF proposes to apply the same ranching conservation practices on the property that it has been using in the local community on private lands. It will focus on restoring grasslands to an aesthetic view by regenerative grazing practices with traditional ranching species (ie cattle and possibly horses/mules for limited times) tough enough to survive predators on their own in accordance with specified certification standards, under a grazing management plan implemented by the LMF livestock manager, utilizing water efficiently, restoring irrigation systems, utilizing mechanical and burning spray -free blackberry removal/setback, following holistic habitat development, applying environmentally conscious and heritage based education, and observing sensitive waterways/spring(s) management plans. LMF is responsible for the quality of work, professional services provided and for providing or utilizing volunteers who are qualified and competent people, and shall provide all supplies, equipment, tools and incidentals to accomplish the work set forth. LMF will follow all appropriate safety methods to assure compliance required with State and Federal regulations, and departmental policies and procedures for all field work in compliance with all applicable codes, land use permitting and professional service standards. The proposer's project management will be transparent, coordinating with the City's agencies and proposer will be available to meet the City staff as required during the project's duration to review the scope of work and deliverables. LMF shall provide general liability insurance coverage at the.agreed upon limits specified in the lease agreement for the subject property. The City of Ashland, its elected officials, officers and employees shall be listed as Additional Insureds on the policy. LMF accepts the TID Annual Charge, ODF Fire Protection Fees and Property taxes. 3 of 4 LMF recognizes that the rental fee will be negotiated. No costs will be imposed on the City of Ashland, and LMF will indemnify the City of Ashland from any and all actions of the leaseholder on the City -owned "Imperatrice" property. Since the organization is a not -for -profit entity, the projected land use is not for business -driven purposes, but rather for a community benefit. Direct environmental stewardship benefits to the community include: Significant improvements to the land and its appearance. Restoring the land to its prior ranching use, but providing ecological support and ensuring biodiversity. Using holistic regenerative agriculture which is free from pesticides and chemical sprays, erosion, pollutants, dust and manufacturing processes. Providing opportunities for community involvement in compliance with permitting and after mechanical equipment periods. Providing open space habitat/spring developed areas for wildlife, offering ample watering and forages in corridors of passage and refuge. - Offering a designated timed field trip in following year(s), including educational opportunities to showcase experienced livestock management, grazing timing on drylands and irrigated land and fencing methods of preserving native and sensitive species biodiversity. Imposing no costs on the City for equipment, fencing canals, water utilization, improved irrigation efficiency, improved irrigation ditches maintenance, experienced operators, and livestock grazing management. Increased property value as a result of the methods applied. LMF proposes to pay the City of Ashland $1.00 as a financial benefit while also accepting the yearly costs associated with the property not to be imposed on the City. Livestock will be managed by the entity the entire length of time the animals are on the property, and the number of animals accords with a specified habitat management plan as defined by Land Manatee Foundation Ranching Conservation Habitat Management Plan (see attached document for reference) in conjunction with NRCS Prescribed Grazing standards [528-1]. Grazing animals and farm implements are utilized as a tool for a specified outcome beneficial to the land use management goals, property specific plans and community wellbeing. Any existing farm/ranch equipment and implements, pipe and fencing on the property are encouraged to be left there and can be utilized for the property by LMF. The developed Ranching Conservation Program and Protocols Certification specific to Land Manatee Foundation can be found in the attached document, which is a living document based on Renee De Launay's compilation of experience and scientific methodology. Renee De Launay is the Founder and Operating CEO of Land Manatee Foundation. She brings 16 years of restoration grazing history and animal healthcare expertise to implement on the City Property. Her youth was well spent in and out of the saddle learning all she has through experience on ranches throughout Southern Oregon, many of which have since changed ownership, being developed for other purposes, closed off to ranching, or converted to hemp, etc. This decline in quality uses of land for traditional agriculture spurred Renee to educate and guide EFU property owners on best practices and maintain agricultural production in the community, using the practices described herein. The supporters of her initiative all have ongoing working relationships with Renee and have utilized her management plans in numerous ways in this 4 of 4 community on their own operations and are dedicated to the practices advocated by Renee in LMF. These supporting associates and Renee are supplying the equipment and grazing animals to be utilized by LMF. A dozer, excavator(s), water lines, troughs, spring boxes, valves, a livestock handling chute, a livestock handling facility and load out panels, a ditch leveler, a skidsteer, tractors, haying implements, trailers, cattle hauling and transportation, horses and mules for packing supplies and doctoring/attending to livestock needs, a water truck, a dump truck, and a backhoe, in conjunction with their knowledge and cumulative experience with conservation ranching operations, environmentally conscious activities, safety and time. It is roughly estimated that all of the ditches need to be addressed, a quarter of the property is in matured blackberries and the current forages are heavily in warm season grasses and noxious weeds or undesirable species. With a goal of addressing 20% of the property's blackberries and its ditches per year, the propagation of cool season grasses and native species can be promoted to restore the land's ranching glory. Experienced active supporting associates and references include the following with attached declaration letters of commitment: Michael Winters (retired Jackson County Sheriff, Winters [Ranches] LLC; TID acumen) cell 541-944-6086 See attached No. 1 Morgan Troxel (Troxel Family Farm/ Maddox Angus Ranch) cell 541-947-2246 See attached No.2 Dina Cantrell (Jackson County Brand Inspector, Cantrell Family Farming Ranches) cell 541-210-0754 See attached No.3 Renee De Launay (LMF Founder, CEO) 541-973-9817 See attached No.4 Elizabeth Schaefer (retired llama rancher) cell 314-809-2737 Gary Baldwin (4AgHawaii Partnerships) cell 808-987-3983 See attached No. 5 Bruce McLean (Chief Maintenance Operator Warren Resorts) cell 541-324-7950 Rodger Goddard (TID and Dunn Ditch acumen) cell 541-821-8810 Adherence to Jackson County Land Development Ordinances In reviewing the current Jackson County Land Development Ordinance ("LDO"), the proposer concludes that LMF's proposed farm use for ranching conservation practices as defined in ORS 215.243 for grazing, harvesting, berry removal via equipment operation and living history uses and any creation, restoration and enhancement of wetlands described above is a Type 1 use, permitted by right and only requiring non -discretionary staff review (pursuant to section 4.2.2 on table 4.2-1 for Exclusive Farm Use (EFU) zoned land, Jackson County LDO). Type 1 authorizations are not land use decisions as defined by ORS 215.402. Any additional applications and permits that may arise will be the responsibility of LMF to follow the process time line for application approval. Any lease that comes from the acceptance of this proposal is not a land use approval. Proposer acknowledges and agrees that future preliminary and or final approvals including plans, plan amendments, plan modifications,*or building permits nor any rights to develop and/or construct on property have been granted or implied simply by the acceptance of this proposal or a lease. PROPOSER INFORMATION: _f-R N B NI AA/A-F('70 �U u N pfjT i Ci'J Proposer Company Name _f O [N X 33 73 &5 )`1l.AN 9 DA 6452y Company Address (from which work will be performed) - !�LaL"-y ?3 - �), 7i5` Telephone Number Fax Number FEDERAL ID NUMBER Printed Name of Person Signing RFP: 12t ti/l.� L. ` c L a Ui✓4Y Title: 1--v uAj O i-0-- Signature: Email Address: GAAI!9MA/N4T1---L-T001V0AT10AJe-041b1 L 23 EXHIBIT C CERTIFICATIONS/REPRESENTATIONS: Consultant, by and through its authorized representative, under penalty of perjury, certifies that (a) the number shown on the attached W-9 for►n is its correct taxpayer ID (or is waiting for the number to be issued to it and (b) Consultant is not subject to backup withholding because: (i) it is exempt from backup withholding, or (ii) it has not been notified by the Internal Revenue Service (IRS) that it is subject to backup withholding as a result of a failure to report all interest or dividends, or (iii) the IRS has notified it that it is no longer subject to backup withholding. Consultant further represents and warrants to City that: (a) it has the power and authority to enter into this Agreement and perform the Work, (b) the Agreement, when executed and delivered, shall be a valid and binding obligation of Consultant enforceable in accordance with its terms, (c) the work under the Agreement shall be performed in accordance with the highest professional standards, and (d) Consultant is qualified, professionally competent, and duly licensed (if applicable) to perform the Work. Consultant also certifies under penalty of perjury that its business is not in violation of any Oregon tax laws, it is an independent contractor as defined in the Agreement, it is authorized to do business in the State of Oregon, and Consultant has checked four or more of the following criteria that apply to its business. ✓ (1) Consultant carries out the work or services at a location separate from a private residence or is in a specific portion of a private residence, set aside as the location of the business. (2) Commercial advertising or business cards or a trade association membership are purchased for the business. (3) Telephone listing is used for the business separate from the personal residence listing. (4) Labor or services are performed only pursuant to written contracts. ✓ (5) Labor or services are performed for two or more different persons within a period of one year. (6) Consultant assumes financial responsibility for defective workmanship or for service not provided as evidenced by the ownership of performance bonds, warranties, errors and omission (professional liability) insurance or liability insurance relating to the Work or services to be provided. ;Consultan s 'nature ).l-./Z /I Date 25 Page 1 of 18 Confidential and specific to Land Manatee Foundation. Living document not yet proofed by all editors. Land Manatee Foundation CONSERVATION RANCHING PROGRAM PROTOCOLS Ranching Heritage Ashland City Council Look Ahead Note This'is a DRAFT schedule of future agenda items ant is subject to frequent charges. 'lwial - Coordinated Water Rights Management and Water Sharing Plan Intergovernmental Agreement Public Works Scott Fleury Review & Discussion of Imperatrice Property Lease Mayor Julie Akins 1-Aug Rogue Retreat Funding Review (tentative) Community Development Bill Mohair Linda Reid 15-Au9 Economic Development & Business Roundtable Follow-up AARP Senior City Report/Livable Community Report Ashland Senior Advisory Committee (ASAC) Committee Chair Housing Capacity & Production Studies Status & EcoNorthwest Review Report Admin. I Community Dev. Sabrina Coda / Bill Molnar Natural gas equipment in New Construction / Major Rehabilitations CEPAC Committee Chair Identification of Representatives of News Media Organizations 5-Sep Meeting Cancelled National Holiday Observed -Labor Day Public Works Scott Fleury 19Sep EcoNorthwest Economic Diversity Study Report Admin. Joseph Lessard Community Budget Survey Report Atlmin. Jose ph Lessard Economic Development& Business Roundtable Follow-up Business Development & Economic Diversity '• •• Community Development Questions & Updates •' (activitycenters, development code 8 process navigation, business issues) 1.Oct City Facilities & Real Estate Hargadine Parking Structure RFP Community Development Bill Molnar Facilities Optimization Master Plan Public Works Scott Fleury Natural Gas Equipment by 2030 in Existing City Facilities " Commemorative & Ceremonial Flags at City Facilities '• 17.Oct Contracting WaterlWastewater System Management Staff Report AWWL Police and Fire Partnering/Regionalization 31.Oct-..,.«,..�..-;..N. 14-Nov 5-Dee 19-D. 2-Jan Meeting Cancelled National Holiday Observed -New Year's Day 16Jan 2-" Public Works Scott Fleury Admin.I Police / Fire Joseph Lessard/Chief O'Meara I Chief Sartain Nov. I th Election Referendums/Initiatives Second Reading -Food & Beverage Tax Ballot hems linitiative & referendum items) Admin. / City Attorney Joseph Lessard / Doug McGeary First Reedin - Measure 109 Psilocybin Ordinance •• Boards & Commissions Update Standing Advisory Committee Appointments Mayor Julie Akins Ordinance to remove commission ordinances Admin. / City Attorney Joseph Lessard / Doug McGeary U date other ordinances to reco n establishment of standin & ad hoc committees •• Climate Change Policy Commission -Home Energy Score Program Citv Recorder Melissa Huhtala Citizens' Budget Committee Appointments •' •• Fire Season Preparations Update Fire Dept. Chief Sartain Police Annual Report Police Dept. Chief O'Meara First Reading -Telecommunications Ordinance Updates (5G) City Attorney Interim City Attorney 16-A.9 Nov. &tit Election Referendums/Initiatives Second Read in - Measure 109 Psiloc bin Ordinance Admin. / CityAttorneyJose h Lessard / Dou Nt Boards & Commissions Update Resolution Creatin Advisory dviso Committees Admin. / C AttorneyJoseph Lessard / Dou MCGea Chamber of Commerce Agreement for Travel Ashland Marketing Admin. Joseph Lessard First Reading - Ordinance on Weeds and Noxious Vegetation Fire Dept. Chief Sartain Second Reading -Telecommunications Ordinance Updates (5G) City Attorney Interim City Attorney Public Hearing and First Reading Housing in Employment Zones Annual Report Community Development Bill Molnar Personnel Issues Executive Session - Labor Negotiation Status Admin. I Human Resources Joe Lessard / Sabrina Cotta Management, Confidential & Unrepresented Employee Resolution Update •• PERS Pick -Up Evaluation ^ Labor Agreement rovela(tentative scheduling) " 6-Sep Infrastructure Master Plans Updates Talent -Ashland -Phoenix (TAP) Water Interne Public Works Scott Fleury Waste water Collection System Master Plan •• •• Storm Drain Master Plan •' Facilities Optimization Master Plan •• •• ReviewiRevisit MOU between Ashland City Council & Ashland Park Commission dated Aug. 19, 2014 Admin./ City Attorney Joseph Lessard I Dour AMC 2.16 Recreation Commission Duties and Powers " updated 7/15/2022 L, Ashland City Council Look Ahead Note. This is a DRAFT achedule of future agenda items ant is subject to frequent charges. AM 2.28.040 Second Reading -Telecommunications Ordinance Updates 513 City Attorney Interim City Attorney Personnel Issues Executive Session - Labor Negotiation Status Labor Agreement Approvals tentative scheduling)" Admin. / Human Resources Joe Lessard / Sabrina Colts 205ep 4-Dct 1&Oct 1-Nov 15-Nov 22-Nov 6-Dec 20-Dec 3-Jan 17Jan Request to form an Ad Hoc Building Code Review Committee Social Equity and Racial Justice Advisory Committee Report Mayor City Recorder Julie Akins Melissa Huhtala t4OT YET SCHEDULED NOTES Cost Analysis of Climate & Energy Action Plan (CEAP) Refinancing PIERS & Capital Debt AFN -Business and Technology Planning RFQ/RFP RFQ in development, City Council will be updated on its issuance COMMISSION PRESENTATIONS DATES Trans ortalion Commission First Meetin in February Tree Commission Second Meeting in March Historic Commission Second Meeting inApril Band Board First Meeting in June Social Equity and Racial Justice Commission Second Meeting In June Wildfire Safety Commission Second Meeting in Jul Forest Lands Commission First Meeting in August Conservation Commission Second Meeting in August Climate PolicyCom—kin First Meetingin Be ember Ai ort Commission Second Meeting in Se tember Public Arts Commission jFirxt Meeting in October Housing & Human Services Commission ISecond Meeting in November Planning Commission First Meeting in December Council Liaison Appointments January State of the City Second Meeting in January Quarterly Financial Report & Budget Amendment First Meeting in February Recology Rate Review First Meeting in March needs to be approved by Aril 1) Proclamation for Arbor Week (Tree Commission) Second Meetingin March Quarterly F,rancial Report & Budget Amendment First Meetin in A ril Commission Reap ointments Second Meeting In April Proclamation for National Historic Preservation Month Historic Commission First Meeting in May (or last meeting In April) Miscellaneous Fees Ma Quarterly Financial Report & Budget Amendment Second Meeting in June Cttizens' Bud et Committee Reappointments Second MeetingIn June Year-Entl Bud et Briefn Au ust or September Proclamation for Indi enous Peo les' Da Council First Meetingin October Quarterly Financial Report & Budget Amendment First Meeting in November Updated 7/15/2022 `,