HomeMy WebLinkAbout2023.02.27 Council Special Meeting Packet
AGENDA
City Council Special Meeting
7:00 PM - Monday, February 27, 2023
Pasco City Hall, Council Chambers & GoToWebinar
Page
1. MEETING INSTRUCTIONS for REMOTE ACCESS - Individuals, who would
like to provide public comment remotely, may continue to do so by filling out
the online form via the City’s website (www.pasco-wa.gov/publiccomment) to
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To listen to the meeting via phone, call (415) 655-0060 and use access code
307-404-066.
City Council meetings are broadcast live on PSC-TV Channel 191 on
Charter/Spectrum Cable in Pasco and Richland and streamed at www.pasco-
wa.gov/psctvlive and on the City’s Facebook page at
www.facebook.com/cityofPasco.
2. CALL TO ORDER
3. ROLL CALL
(a) Pledge of Allegiance
4. UNFINISHED BUSINESS
3 - 7 (a) Public Hearing Continued - Jubilee Foundation Right-of-Way
Vacation (VAC 2022-009)
PUBLIC HEARING CONTINUED FROM FEBRUARY 6th AND
FEBRUARY 21ST
Option A: MOTION: (Not recommended)I move to approve the
vacation request and direct staff to prepare an ordinance vacating
rights-of-way in Washington Addition to Pasco in the vicinity of East A
Street and East Helena Street.
Option B: MOTION: (Recommended): I move to continue the request
to vacate rights-of-way in Washington Addition to Pasco in the vicinity
Page 1 of 43
of East A Street and East Helena Street to a date after approval of a
preliminary plat for the properties in question or until such time as
adverse impacts to adjoining properties can be mitigated.
8 - 43 (b) Resolution No. 4311, Process Water Reuse Facility (PWRF) Draft
Processor Wastewater Treatment Agreement (WTA)
MOTION: I move to approve Resolution No. 4311, authorizing the
Interim City Manager to enter into the Process Water Reuse Facility
(PWRF) Industrial Wastewater Pretreatment Agreement with the
Processors for the PWRF Pretreatment Improvements Phase 3
Project.
5. ADJOURNMENT
Page 2 of 43
AGENDA REPORT
FOR: City Council February 23, 2023
TO: Adam Lincoln, Interim City Manager City Council Special
Meeting: 2/27/23
FROM: Rick White, Director
Community & Economic Development
SUBJECT: Public Hearing Continued - Jubilee Foundation Right-of-Way Vacation
(VAC 2022-009)
I. REFERENCE(S):
Overview Map
Vicinity Map
II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS:
PUBLIC HEARING CONTINUED FROM FEBRUARY 6th AND FEBRUARY
21ST
Option A: MOTION: (Not recommended) I move to approve the vacation
request and direct staff to prepare an ordinance vacating rights -of-way in
Washington Addition to Pasco in the vicinity of East A Street and East Helena
Street.
Option B: MOTION: (Recommended): I move to continue the request to vacate
rights-of-way in Washington Addition to Pasco in the vicinity of East A Street and
East Helena Street to a date after approval of a preliminary plat for the properties
in question or until such time as adverse impacts to adjoining properties can be
mitigated.
III. FISCAL IMPACT:
None.
IV. HISTORY AND FACTS BRIEF:
The applicant has submitted an application to vacate streets and alleys adjacent
and within Blocks 5, 11, and 12 of the 1913 Washington Addition to Pasco plat.
The plat contains 25'-wide lots and 80'-wide street rights-of-way, as well as 14'
Page 3 of 43
wide north-south alleys and 20' wide east west alleys. The proposed vacation
comprises approximately 3.87 acres.
Applicant's objective is to reconfigure the rights-of-way to accommodate a
subdivision and multi-family units along East Helena and East "A" Street to
match similar existing developments to the east.
This hearing was continued from the February 21, 2023, Council regular
meeting.
V. DISCUSSION:
Per the Pasco Municipal Code (PMC) Chapter 12.40, the Council may require
compensation for vacated rights-of-way. The compensation involves obtaining a
title the and compensation the However, of appraisal and report value.
requirements attached thereto may be waived if one or more of the following
conditions apply:
1. The vacation is initiated by the City Council by Resolution;
2. The vacation is at the request of the City;
3. The right-of-way to be vacated was previously determined by the City
Council not to be essential to public traffic circulation and available for
vacation;
4. The grant of substitute right-of-way which has a value as a right-of-way at
least equal to that right-of-way to be vacated; and
5. The resulting benefit to the community of the project requiring the vacation
outweighs the appraised value of the right-of-way to be vacated.
In order to justify a waiver under condition No. 4, Applicant would be required to
grant substitute travel and access corridors which meet Pasco Municipal Code
requirements and Comprehensive Plan goals and policies. While it is the
applicant's intent to submit a preliminary plat application that will accomplish this
condition, an acceptable preliminary plat has not yet been approved by the City.
Staff also brings to Council attention the following:
• Per PMC 21.15.010(1) "Streets shall normally continue as an extension
of existing streets unless good planning dictates a different solution.
Street patterns shall take into consideration access neede d to develop
adjacent properties." The current proposal does not continue an existing
street nor take into consideration access needed to develop adjacent
properties.
• Per PMC 21.15.070 "Cul-de-sacs will be permitted where topography or
other conditions justify their use." The topography of the site, slightly
sloping southward, does not justify a cul-de-sac.
Page 4 of 43
• Per PMC 12.40.070(1)-(4), the City Council may approve a right-of-way
vacation upon making findings that the vacation of the right-of-way will not
adversely affect traffic accessibility and circulation within the immediate
area or with the City as a whole; is not contemplated or needed for future
use; no abutting property will become landlocked or have access
substantially impaired; and the public needs shall not be adversely
affected and the vacation will provide a public benefit or serve a public
purpose.
The proposed vacation would likely have an adverse impact on development of
property to the northwest of the plat, leaving them with a non -standard right-of-
way abutting their property. Applicant must ultimately submit a plan for travel and
access corridors which meet the Pasco Municipal Code requirements and
Comprehensive Plan goals and policies. The proposed plat must also provide
mitigation measures for adverse impacts to neighboring properties. Since a plat
application has not been received or appropriately considered and conditioned
through the Hearing Examiner, it is premature to process the vacation.
As such, Staff recommends the request to va cate rights-of-way in Washington
Addition to Pasco in the vicinity of East A Street and East Helena Street be
continued until an approved plat with acceptable mitigation measures has been
received and approved.
Page 5 of 43
Item:WashingtonAdditionStreetsandAlleysROWVacationApplicant(s):JubileeFoundationc/0SteveBaumanFile#:VAC2022-009OverviewPage 6 of 43
Item:WashingtonAdditionStreetsandAlleysROWVacationVlclnltyApplicant(s):JubileeFoundationc/0SteveBaumanMapFile#;VAC2022-009Page 7 of 43
AGENDA REPORT
FOR: City Council February 23, 2023
TO: Adam Lincoln, Interim City Manager City Council Special
Meeting: 2/27/23
FROM: Steve Worley, Director
Public Works
SUBJECT: Resolution No. 4311, Process Water Reuse Facility (PWRF) Draft
Processor Wastewater Treatment Agreement (WTA)
I. REFERENCE(S):
Resolution Approving PWRF Processor WTA
Pasco-Processor Wastewater Treatment Agreement (WTA) – Draft 2
Exhibit C – Projected Influent Criteria for each Processor
Burnham Clarification Letter
Gross-Wen Technologies Clarification Letter
II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS:
MOTION: I move to approve Resolution No. 4311, authorizing the Interim City
Manager to enter into the Process Water Reuse Facility (PWRF) Industrial
Wastewater the for Processors PWRF with Agreement Pretreatment the
Pretreatment Improvements Phase 3 Project.
III. FISCAL IMPACT:
Recent value engineering proposals and other potential cost saving efforts, have
reduced the estimated Phase 3 cost to approximately $122 million.
The overall cost to the PWRF Processors includes the benefits of revenues
generated through the sale of renewable natural gas (RNG) and a 30%
investment tax credit for all RNG-related facilities.
Monthly Fee:Service Estimated for provisions with month per $850,000
adjustments based on final costs. Monthly fee to be proportionately allocated to
Pasco Processing, Twin City Foods, Reser’s, Simplot, Grimmway, Freeze Pack,
and Darigold.
Estimated Renewable Natural Gas (RNG) Revenue: ~$6 million per year, with
provisions for adjustment based on final RNG sales contract.
Page 8 of 43
Potential Federal Income Tax Credit:
$26+ million with provisions for adjustments based on final credit. (Available to
reduce principal amount).
Community Economic Revitalization Board (CERB):
$5 million low-interest loan for the Phase 3 project.
Potential Federal or State Grants:
Staff continues to pursue grants for this project to help reduce final costs to the
PWRF Processors.
IV. HISTORY AND FACTS BRIEF:
The City owns and operates an industrial wastewater treatment system to treat
industrial wastewater from six agricultural food processors (Processors). The
system includes the Process Water Reuse Facility (PWRF). The PWRF requires
expansion in storage and treatment capacity, and the application of new
technology, to allow existing Processors to expand their operations and provide
capacity for Darigold’s future wastewater.
Upgrades to the PWRF pretreatment system will significantly improve treatment
capacity for the benefit six existing and one or two future Processors, customers,
and the local community. The PWRF improvements also have a positive impact
on the Municipal Wastewater Treatment Plant (WWTP) by redirecting a
significant load of industrial wastewater away from the WWTP. This frees up
much and residential increased for capacity WWTP at needed allowing
commercial developments that can be served.
In 2019, Ecology approved Pasco’s PWRF Facility Plan which identified a series
of improvements to expand the PWRF to meet current and future needs. The
scope of the PWRF recommended improvements included the following:
• Extension of potable water and electrical services to the site (Phase 1)
• Additional winter storage ponds (Phase 2)
• Industrial wastewater pretreatment improvements (Phase 3)
The PWRF stakeholders agreed to move forward with design and construction
following this phased approach. The Phase 1 project is currently under
construction. The Phase 2 project is in the design phase.
On January 10, 2022, staff provided Council a presentation on proposed updates
to the Process Water Reuse Facility (PWRF) with the potential to include a
Renewable Natural Gas (RNG) option that will help reduce costs to the PWRF
Page 9 of 43
Processors. Council indicated support to move forward with the proposed
concept.
Through processes outlined in Chapter 70A.140 RCW, Water Quality Joint
Development Act, Burnham SEV, a renewable natural gas (RNG) Project
Developer, was selected to privately finance, design, construct, and operate an
upgraded industrial wastewater treatment plant that includes a renewable
natural gas plant at the PWRF. This Phase 3 project is 70% complete with design
and ready to move forward with final design and construction managed by
Burnham SEV.
Staff presented to Council on October 12, 2022, a draf t WTA between the City
and Burnham SEV. On February 13, 2023 staff presented to Council the
proposed draft WTA between the City and Processors.
V. DISCUSSION:
The attached draft WTA outlines the terms and conditions for payment of
industrial wastewater treatment services. The PWRF Phase 3 facilities that will
treat the Processor’s industrial wastewater include a low-rate anaerobic digester
(LRAD), a biological nitrogen removal system (sequential batch reactor (SBR) or
rotating algal biofilm (RAB)), and a renewable natural gas (RNG) system.
The RNG produced from the Processor’s wastewater will be sold by Burnham
SEV on the volunteer RNG market and revenue from the sale of RNG will be
used to pay a portion of the capital cost of the Phase 3 project, subsequently
reducing fees paid by the Processors.
The proportionate fee for each Processor is still being finalized. The fee will be
based on several factors including total annual and peak flows from each
Processor to the PWRF, and concentrations of Biochemical Oxygen Demand
(BOD), Nitrogen, Total Suspended Solids (TSS), and other factors. The City is
utilizing the services of the FCS Group to develop a rate mode l to assist in
determining the proportionate fee to each Processor. The rate model has been
reviewed several times with the Processor group evaluating different
alternatives. Included in the attachments is the latest cost distribution for all four
phases of the PWRF Pretreatment project. Only the Phase 3 project is the
subject of the Processor WTA.
This item was discussed at the February 21, 2023, Council Regular Meeting.
Staff recommends approval of the draft Processor WTA in substantially the same
form as presented and to make substantive changes as necessary to execute
the Agreements.
Page 10 of 43
Resolution – Pasco Processors Wastewater Treatment Agr. - 1
RESOLUTION NO. _______
A RESOLUTION OF THE CITY OF PASCO, WASHINGTON,
AUTHORIZING THE INTERIM CITY MANAGER TO ENTER INTO THE
PROCESS WATER REUSE FACILITY (PWRF) INDUSTRIAL
WASTEWATER PRETREATMENT AGREEMENTS WITH MULTIPLE
PROCESSORS FOR THE PWRF PRETREATMENT IMPROVEMENTS PHASE
3 PROJECT.
WHEREAS, the City of Pasco (City) operates a Process Water Reuse Facility (PWRF) to
treat industrial wastewater from Food Processors (Processors) located in the vicinity of the City of
Pasco; and
WHEREAS, the City’s current PWRF system has reached its design life and capacity,
such that upgrades and expansion are necessary to accommodate existing and new agricultural
food processor wastewater from current and future processors; and
WHEREAS, Burnham SEV, a renewable natural gas (RNG) Project Developer, is in the
process of being selected, through processes outlined in Chapter 70A.140 RCW, to privately
develop a new industrial wastewater treatment plant, utilizing a low-rate anaerobic digester and
nitrogen removal system (System) along with a renewable natural gas plant at the PWRF; and
WHEREAS, City and Burnham SEV entered an agreement on November 24, 2021,
wherein the City (and Processors) agreed to support the cost of initial engineering for the System;
and
WHEREAS, Chapter 70A.140 of the RCW Water Quality Joint Development Act
provides a mechanism for the City to provide service from water pollution control facilities by
means of services agreements with public or private parties; and
WHEREAS, pursuant to RCW 70A.140.040(9), prior to execution of the Wastewater
Treatment Agreement, Burnham and the City understand the necessity of submitting the “proposed
service agreement” to the Department of Ecology to review for consistency with RCW 90.46 and
RCW 90.48, as a condition precedent to the City’s authority to execute the Wastewater Treatment
Agreement with Burnham and have complied with this condition; and
WHEREAS, Processors agree to pay City a Base Treatment Fee and/or an Adjustment
Treatment Fee as described herein and shown in Exhibit B; and
Page 11 of 43
Resolution – Pasco Processors Wastewater Treatment Agr. - 2
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF PASCO, WASHINGTON:
That the Interim City Manager is hereby authorized to execute the attached PWRF
Industrial Wastewater Pretreatment Agreement in substantially the same form with each of the
Processors for the PWRF Pretreatment Improvements Phase 3 Project, a copy of which is attached
hereto and incorporated herein by reference as Exhibit A; and to make substantive changes as
necessary to execute the Agreement.
Be It Further Resolved, that this Resolution shall take effect and be in full force
immediately upon passage by the City Council.
PASSED by the City Council of the City of Pasco, Washington, on this ______ day of
_______, 2023.
_____________________________
Blanche Barajas
Mayor
ATTEST: APPROVED AS TO FORM:
_____________________________ __________________________
Debra Barham, CMC Kerr Ferguson Law, PLLC
City Clerk City Attorneys
Page 12 of 43
505985890.3
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FG: 100895287.4
CITY OF PASCO – PROCESS WATER REUSE FACILITY (PWRF)
INDUSTRIAL WASTEWATER PRETREATMENT AGREEMENT
WITH [PROCESSOR NAME]
1.AGREEMENT. This Industrial Wastewater Treatment Agreement (“Agreement”) is entered as
of the Effective Date by and between [Processor Name], a ______________ (“Processor”), with offices
at [Processor address], and the City of Pasco, a Washington municipal corporation (“City”), with offices
at 525 N 3rd Avenue, Pasco, WA 99301. The City and Processor are each a “Party” and collectively the
“Parties” to this Agreement. The Parties agree as follows
2. RECITALS
2.1 The City owns and operates a wastewater utility, including a process wastewater reuse facility
(“PWRF”) that operates for the benefit of the City and large agricultural food processors. The PWRF
pretreats, treats, and disposes of approximately one billion gallons of agricultural industrial wastewater by
land application on 1,854 acres of City-owned farmland. See Washington State Discharge Permit No.
ST0005369. The existing PRWF consists of a primary treatment process (including two rotary drum
screens, one modified clarifier, 12 septic tanks for solids collection from the clarifier, one screw press for
solids removal from the rotary drum screens system), one approximately five million gallon pond
previously used as solids storage, one eight million gallon pond used as an equalization pond, one 35
million gallon pond for winter storage, and one 115 million gallon (“MG”) pond for winter storage, and
an irrigation system for land application of agricultural industrial wastewater.
2.2 The City’s current PWRF system has reached it design life and capacity, such that upgrades, and
expansion are necessary to accommodate new and increasing agricultural food processor wastewater. To
meet the Washington Department of Ecology’s (“Ecology”) permit requirements to expand the PWRF’s
capacity, the City sought a contractor capable of treating agricultural and milk-processing industrial
wastewater and using the biogas produced from such treatment to generate Renewable Natural Gas
(“RNG”). Following a competitive selection process, the City selected Burnham SEV Pasco, LLC
(“Burnham”) to develop, design, construct, and operate, a wastewater treatment and nitrogen removal
system (the “System,” as more particularly described in Exhibit A) and integration of Burnham’s RNG
production process. Burnham is to finance, construct, own, and operate the System on City-owned
property.
2.3 The City is in the process of preparing and submitting a new Washington State Waste Discharge
Permit (“Discharge Permit”) application to Ecology, to include the System and all other components of
the agricultural industrial wastewater treatment and disposal process. The City will develop, operate, and
maintain other facilities, including its storage ponds (equalization and winter storage), irrigation system,
land application area, and all related assets (e.g., conveyance water pipes, pump stations, wells, and
appurtenances) (“City Facilities”) and the City intends to be a joint permittee with Burnham under the
Discharge Permit with roles and responsibilities for its implementation as defined in a separate
Wastewater Treatment Agreement.
2.4 Under RCW 70A.140.040(9), prior to execution of the Wastewater Treatment Agreement with
Burnham, Burnham and the City understand the necessity of submitting a “proposed service agreement”
to Ecology to review for consistency with chapters 90.46 and 90.48 RCW, as a condition precedent to the
City’s authority to execute the Wastewater Treatment Agreement with Burnham. Ecology has reviewed
the proposed service agreement and found it consistent with referenced laws.
2.5 The System and City Facilities will be supported by rates and fees paid to the City by processors,
including Processor. This Agreement provides for Processor agreement to pay City for a Base Treatment
Page 13 of 43
505985890.3
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FG: 100895287.4
Fee and Adjustment Treatment Fee as described herein and shown in Exhibit D, and for the City to
provide for the System and the City Facilities to receive and process Processor’s wastewater.
3.DEFINITIONS
3.1 “Abnormal Substances” means substances or materials (including viscous, toxic or hazardous
substances) that (i) were not reasonably anticipated by City as being in the Influent Industrial Wastewater,
(ii) are present in the Influent Industrial Wastewater in a type, concentration or loading that was not
reasonably anticipated by City; or (iii) exceed the design capacity of the System to adequately treat when
operated in accordance with Prudent Industry Practices.
3.2 “Adjusted Treatment Fee” has the meaning given in Exhibit F.
3.3 “Base Treatment Fee” has the meaning given in Exhibit F.
3.4 “Change of Law” means after the Effective Date (i) the enactment, adoption, promulgation,
modification or repeal of any law or regulation applicable to the System or the production or sale of RNG;
(ii) the imposition of any material conditions on the issuance or renewal of any applicable Permit
(notwithstanding the general requirements contained in any applicable Permit at the time of application or
issue to comply with future laws, ordinances, rules, regulations or similar legislation), or (iii) a change by
any governmental authority that establishes requirements affecting owning, supplying, constructing,
installing, operating or maintaining the System, or other performance of the obligations of either Party
hereunder.
3.5 “Changed Circumstances” has the meaning given in Section 4.2.
3.6 “City Facilities” has the meaning given in Agreement Section 2.3.
3.7 “City Obligation(s)” has the meaning given in Section 4.1.
3.8 “City Permits” means the Permits that must be obtained and maintained by Processor as set forth
in Exhibit G.
3.9 “Commercial Operation” means the System is capable of processing Influent Wastewater
sufficient to meet the Effluent Wastewater specifications on a regular, daily basis and in commercial
quantities as determined by a third-party independent engineer selected by Burnham in its sole discretion.
3.10 “Consumer Price Index” means the United States Department of Labor’s Bureau of Labor
Statistics Consumer Price Index, All Urban Consumers, All Items, West Region, (1982-84 equals 100), or
the successor of such index.
3.11 “Discharge Permit” has the meaning given in Agreement Section 2.3.
3.12 “Ecology” means the Washington State Department of Ecology.
3.13 “Effective Date” has the meaning given in Agreement Section 13.3.
3.14 “Effluent Wastewater” means agricultural or dairy industrial wastewater, as measured at [the
point at which the Effluent Wastewater is returned to the City as more particularly described in [Exhibit
Page 14 of 43
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FG: 100895287.4
A]1, that meets the specifications in Exhibit A.
3.15 “Effluent Wastewater Failure” has the meaning given in Section 7.1.
3.16 “Influent Wastewater” means agricultural and dairy processing industrial wastewater that does
not contain industrial wastewater in excess of applicable federal and state industrial pre-treatment
standards, does not contain Abnormal Substances, and otherwise meets the specifications in
1 NTD: monitoring locations for influent and effluent return(s).
Page 15 of 43
505985890.3
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FG: 100895287.4
Exhibit C, as measured at [the point at which the Influent Wastewater is delivered to the PWRF as more
particularly described in Exhibit A2].
3.17 “Initial Term” has the meaning given in Section 2.1.
3.18 “Insolvency Event” means with respect to any Party, when: (a) the Party commences a voluntary
case or other proceeding seeking liquidation, reorganization or other relief with respect to itself or its
debts under any bankruptcy, insolvency, reorganization or other similar law of any jurisdiction now or
hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar
official of such Party or any substantial part of its property, or consents or agrees to any such relief or to
the appointment of or taking possession by any such official in an involuntary case or other proceeding
commenced against it, or makes a general assignment for the benefit of creditors, or becomes or is
declared insolvent, or acknowledges, in writing, its inability to pay its debts as they become due, or takes
any corporate action in any jurisdiction to authorize any of the foregoing; (b) an involuntary case or other
proceeding is commenced against the Party seeking liquidation, reorganization or other relief with respect
to it or its debts under any bankruptcy, insolvency, reorganization or other similar law of any jurisdiction
now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of such person or any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of ninety (90) days; or (c) an order for
relief has been entered against that Party under the United States federal, state or other bankruptcy laws of
any jurisdiction as now or hereafter in effect.
3.19 “Late Payment Rate” has the meaning given in Section 5.3.
3.20 “Major Maintenance Expenses” means all costs, fees, obligations and other liabilities incurred
by Burnham and associated with maintaining System performance, including without limitation
maintenance, repair, renewal, capital expenditures, reconstruction or replacement of any portion or
component of the System, as applicable.
3.21 “Material Breach” has the meaning given in section 6.2.
3.22 “MG” means million gallon(s).
3.23 “Modifications” has the meaning given in Section 5.4.
3.24 “Non-Conforming Influent Wastewater” means agricultural or dairy industrial wastewater
delivered or directed by Processor to the System that fails to meet in any respect or for whatever reason
the specifications in
2 NTD: monitoring locations for influent and effluent return(s).
Page 16 of 43
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FG: 100895287.4
Exhibit C.
3.25 “Non-Material Breach” has the meaning given in Section 6.1.
3.26 “Pass-Through Costs” has the meaning given in Exhibit F.
3.27 “Permits” means the permits, licenses, certificates, clearances, approvals, authorizations,
variances, or consents of any governmental authority, department, or agency, including all amendments
thereto and replacements thereof, that must be obtained and/or maintained for construction and operation
System.
3.28 “Processors” means the collective of all food product Processors that discharge their industrial
wastewater to the PWRF, including Processor.
3.29 “Processor Obligations” means the obligations as set out in this Agreement specific to the
processors which must be met as a condition of continued use of the PWRF system.
3.30 “Prudent Industry Practices” means any of the practices, methods and acts engaged in or
approved by a significant portion of the wastewater treatment industry for facilities of similar size and
characteristics to the System or any of the practices, methods or acts, which, in the exercise of reasonable
judgment in the light of the facts known or that should reasonably have been known at the time a decision
is made, could have been expected to accomplish the desired result at the lowest reasonable cost
consistent with law, regulation, permits, [written notice from City]es, standards, equipment
manufacturer's recommendations, reliability, safety, environmental protection, economy, and expedition.
3.31 “PWRF” has the meaning given in Agreement Section 2.1.
3.32 “Remedy” has the meaning given in Section 7.3(e)
3.33 “Renewable Natural Gas” or “RNG” means biomethane produced by the System that meets
natural gas pipeline-quality standards such that the biomethane may blend with, or substitute for, geologic
natural gas.
3.34 “Renewal Term” has the meaning given in Section 2.2.
3.35 “Services” means the services to be provided by the City, its subcontractors, agents, or assigns,
under this Agreement, as set forth in Exhibit B.
3.36 “System” means the City- and Burnham-supplied industrial wastewater treatment and RNG
production facility and ancillary components as set forth in Exhibit A.
3.38“Term” has the meaning given in Section 2.2.
3.38 “Total System Capital Cost” means actual costs incurred or payable by City or its affiliates in
connection with the development, construction and completion of the System, excluding working capital
required for System start-up and financing costs.
4.TERM
4.1 This Agreement shall commence on the Effective Date and continue thereafter for a
period of thirty (30) years (the “Initial Term”) unless terminated in accordance with this
Agreement or extended as provided in Section 2.2.
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FG: 100895287.4
4.2 Upon expiration of the Initial Term, this Agreement shall automatically extend for two
additional five (5)-year periods (each a “Renewal Term” and together with the Initial Term, the
“Term”), unless terminated by either Party by sending written notice of termination to the other
Party no later than one hundred and eighty (180) days before the end of the Initial Term or any
Renewal Term, as applicable.
5. PROCESSOR OBLIGATIONS In addition to any other obligations set forth herein, including
any obligations in
Page 18 of 43
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FG: 100895287.4
Exhibit C, Processor shall comply with the following obligations (each a “Processor Obligation” and
together the “Processor Obligations”):
5.1 Influent Wastewater. Commencing on written notice from City and continuing
throughout the Term, Processor shall at its sole cost and expense deliver to City the Influent
Wastewater in accordance with the specifications in
Page 19 of 43
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FG: 100895287.4
Exhibit C. If at any time City becomes aware that Influent Wastewater delivered by Processor is
Non-Conforming Influent Wastewater, City may, in its sole discretion, choose to refuse, accept or
bypass such Non-Conforming Influent Wastewater; provided, however, that City’s acceptance of
Non-Conforming Influent Wastewater shall not relieve Processor of any responsibility or any
costs, damages, or liabilities associated with Non-Conforming Influent Wastewater, and City does
not waive any other rights or remedies associated with Processor’s delivery of Non-Conforming
Influent Wastewater.
5.2 Payment. Processor shall pay City in accordance with Section 5.
5.3 If there are any changes in Processor’s ability to comply with the Processor’s Obligations
in
Page 20 of 43
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FG: 100895287.4
Exhibit C, any change in circumstances, or a Change of Law that necessitates a change to the
System or the services to be provided by City in connection herewith (individually or
collectively, “Changed Circumstances”), Processor shall be proportionally responsible for any
increased costs incurred by City to operate the System due to such Changed Circumstances.
6. CITY OBLIGATIONS
6.1 In addition to any other obligations set forth herein, including any obligations in
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Exhibit C, City shall comply with the following obligations (each a “City Obligation” and together the
“City Obligations”):
6.2 Other Agreements. City shall enter into agreements with service providers to design,
develop, construct and operate the System and the City Facilities if not operated by the City.
7. PAYMENT FOR SYSTEM AND SERVICES; CHANGE ORDERS
7.1 Commencing on written notice from City and continuing throughout the Term, Processor
shall pay City the Adjusted Treatment Fee, Pass-Through Costs, and any applicable adjustments
as calculated and invoiced by City on a monthly basis in accordance with this Agreement. City
collection on delinquent Processor accounts is governed by Chapters 3.65 and Title 13 Pasco
Municipal Code, as may be amended in the future.
7.2 Except in the case of Material Breach by City or as explicitly specified in this Agreement,
commencing on written notice from City Processor shall pay to City the Adjusted Treatment Fee
each month and through the end of the Term notwithstanding any failure by Processor to deliver
Influent Wastewater or failure or inability of City to accept Influent Wastewater or deliver
Effluent Wastewater.
7.3 At any time during the Term, Processor may request additional services from the City or request
any alterations, additions, omissions, modifications, or changes in the scope, schedule, sequence,
methods, or performance of the System or Services (together “Modifications”). City agrees to
reasonably cooperate with Processor to evaluate and implement Modifications proposed by Processor
and accepted by City. 8.NON-MATERIAL AND MATERIAL BREACHES OF THIS AGREEMENT
8.1 Any breach under this Agreement by either Party that is not a Material Breach shall be a “Non-
Material Breach.”
8.2 The following circumstances shall constitute a “Material Breach” by the applicable non-
performing Party:
The Processor’s failure to make any payment required under this Agreement and invoiced by the City in
accordance with Section 5 and Exhibit F; provided, however, that City shall provide written notice of
such failure to Processor and [Processor name] shall have thirty (30) days to submit payment in full
(including any interest or penalties) following such notice;
An Influent Wastewater Failure (as defined in Section 7.2a) of cause and sufficient duration to be a
Material Breach under Section 7.1(c)
Processor’s relocation, alteration, addition, improvement, maintenance or repair of its system made
without City’s written consent.
In respect of either Party, the other Party’s material misrepresentation, fraud, or intentional misconduct in
connection with this Agreement,.
In respect of either Party, an Insolvency Event for that Party.
9. REMEDIES; CROSS-DEFAULTS
9.1 Remedies for Non-Material Breach Due to Effluent Wastewater Failure. The City’s failure
or inability to meet the Effluent Wastewater specifications listed in Exhibit D (“Effluent Wastewater
Failure”) shall be a Non-Material Breach of this Agreement.
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9.2 Upon either Party’s determination that an Effluent Wastewater Failure has occurred, such Party
shall provide a reasonably detailed notice to the other Party explaining the circumstances of such Effluent
Wastewater Failure as soon as reasonably practical but no later than ten (10) days of such determination.
The Parties will immediately cooperate and take steps to remedy such Effluent Wastewater Failure
consistent with Section 0.
9.3 Notwithstanding the above, if the Effluent Wastewater Failure was caused by Processor’s
delivery of Non-Conforming Influent Wastewater, such remedy shall be determined by Section 9.4.
9.4 Remedies for Non-Material Breaches of Certain Processor Obligations.
9.4.1 If Processor fails to deliver Influent Wastewater in accordance with
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Exhibit C and Section 3.1A or delivers Non-Conforming Influent Wastewater, the City shall promptly
notify Processor of such failure and Processor shall be solely responsible for any and all losses, damage to
the System, or additional costs incurred by the City or its contractors that were caused by Processor ’s
failure or delivery of Non-Conforming Influent Wastewater, including without limitation any additional
costs of treating, handling, storing, and disposing of such Non-Conforming Influent Wastewater.
9.4.2 In the event of any damage to the System caused by Processor’s acts or omissions or
breach of this Agreement, Processor shall remain obligated to perform all obligations under this
Agreement and Processor shall reimburse City for the repair and restoration of the System to the same
condition as existed immediately before such damage occurred. The City shall promptly notify Processor
of any damage to the System caused by Processor’s acts or omissions.
9.4.3 Such remedies in this Section 9.4 shall be non-exclusive, and every other right and
remedy be cumulative and in addition to every other right and remedy given under this Agreement or
existing at law, in equity, or otherwise now or after the Effective Date, and the assertion or employment
of any right or remedy under this Agreement should not prevent the concurrent assertion of any other
right or remedy.
9.5 Remedies for Other Non-Material Breach by Either Party. As promptly as may be
reasonably practicable, and in all circumstances no later than thirty (30) business days after becoming
aware of a Non-Material Breach, the performing Party shall provide written notice of the Non-Material
Breach to the non-performing Party (“Claim Notice”). The failure by the performing Party to give such
prompt notice shall not constitute a waiver except to the extent, if any, that the non-performing Party is
materially prejudiced by such failure.
9.5.1 Any Claim Notice sent by the performing Party to the non-performing Party shall set forth in
reasonable detail, to the extent then known or reasonably available:
(a) the facts and circumstances giving rise to such Non-Material Breach, including all relevant
supporting documentation;
(b) the nature of the losses suffered or incurred or expected to be suffered or incurred by the
performing Party;
(c) a reference to the provisions of this Agreement in respect of which such losses have been suffered
or incurred or are expected to be suffered or incurred;
(d) the amount of losses suffered or incurred and, to the extent the losses have not yet been suffered
or incurred, a good faith estimate (to the extent reasonably possible, based on the information) of the
amount of losses that could be expected to be suffered or incurred;
(e) a reasonably detailed demand for the non-performing Party to take such actions or pay the
performing Party any amounts due or reasonably expected to be due to cure the Non-Material Breach (the
“Remedy”); and
(f) such other information as may be necessary for the non-performing Party to determine whether
any limitations under this Agreement may apply.
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9.5.2 Upon receiving any Claim Notice, the non-performing Party shall perform or pay the Remedy, as
applicable, as soon as reasonably practicable, but in any event no later than thirty (30) calendar days. If
such Remedy is not reasonably capable of being implemented within thirty (30) calendar days, the Parties
shall agree on a longer time to implement the Remedy. If the non-performing Party refuses to comply
with the Claim Notice, any disagreements will be resolved by the dispute resolution procedures in Section
7.
9.5.3 The Parties agree that a Non-Material Breach will not result in a right for either Party to terminate
this Agreement
9.6 Remedies for Material Breach of Either Party
9.6.1 Material Breach by the City. If the City is in Material Breach of this Agreement by its inability to
accept Influent Wastewater from Processor, the Processor may, but is not required to, terminate this
Agreement by providing the City one hundred eighty (180) days advance written notice of the Material
Breach, during which one hundred eighty (180) day period the City shall have the opportunity to cure
such Material Breach. If the City fails to cure Processor exercises its termination right, such termination
shall be effective upon the date that each of the following conditions is satisfied:
(a) Processor shall pay to the City a sum representing the total value of any Outstanding Debt, minus
the value of any insurance proceeds received or owed to the City or Lender arising from a System
casualty preceding the City’s Material Breach; and
(b) Processor and City shall execute any agreements or documents necessary to complete the
assignment and transfer of the Influent Wastewater to Processor.
9.6.2 Material Breach by Processor. If Processor is in Material Breach of this Agreement, the City may,
but is not required to, terminate this Agreement by providing Processor one hundred eighty (180) days
advance written notice of the Material Breach, during which one hundred eighty (180) day period
Processor shall have the opportunity to cure such Material Breach. If Processor fails to cure and the City
exercises its termination right, Processor shall owe to the City as direct damages, and not as a penalty:
(a) The greater of (x) the undiscounted value of Processor’s payments to the City for the remainder
of the Term (excluding Pass-Through Costs), as reasonably calculated by the City, in accordance with
Exhibit F, or (y) a proportionate share of the Outstanding Debt; and
(b) The total amount owed by the City to Burnham for impacts on PWRF, including RNG production
caused by the need to terminate this Agreement as a result of Processor’s Material Breach.
9.7 In the case of any actual or anticipated breach of this Agreement, each Party agrees to use good
faith efforts to take such commercially reasonable actions as necessary to expeditiously resolve the
underlying circumstances including without limitation cooperating with the other Party to obtain any new
or modified System Permits or other approvals necessary or appropriate in connection with the
ownership, occupation, possession or use of the System; provided, however, that in all circumstances
neither Party shall be required or be deemed to have waived any defenses it may have under any
applicable law or contract.
10. REPRESENTATIONS AND WARRANTIES
Each Party represents and warrants that it has full power and authority under the laws of the State of
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Washington to enter into this Agreement.
10.2 All covenants and conditions of this Agreement shall run with Processor’s land and shall bind
its successors and assigns, whether so expressed or not.
10.3 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, EACH PARTY MAKES NO WARRANTY
OR REPRESENTATION OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED. ALL
IMPLIED WARRANTIES INCLUDING, WITHOUT LIMITATION, WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY
DISCLAIMED.
11. FORCE MAJEURE
In the event either Party is rendered unable, wholly or in part, to carry out its respective obligations under
this Agreement, except for any obligation to make payment, due to circumstances beyond its reasonable
control, including, without limitation, riot or other civil disturbances, flood, natural disaster, acts of God,
terrorist act, war or civil insurrection, an epidemic, pandemic or viral or communicable disease outbreak,
quarantine, national emergency or other unforeseeable circumstances beyond its reasonable control (a
“Force Majeure”), then written notice setting out the reason for non-performance shall be given to the
other Party by the Party claiming Force Majeure promptly following discovery thereof. Upon receipt of
such notice, the obligations of the affected Party shall be suspended during the period of the Force
Majeure and any deadline or date certain for performance shall be extended by a period equal to the
period of the Force Majeure. Every reasonable effort shall be made by the Parties to avoid delay and limit
any period during which performance under this Agreement might be suspended.
12. GOVERNING LAW AND DISPUTES
12.1 This Agreement shall be interpreted in accordance with the laws of the State of Washington
without giving effect to its choice of law principles. Venue for any court action under this Agreement
shall be the Washington state superior court for Franklin County.
12.2 Any disagreement between the City and Processor which cannot be resolved in accordance with
this Agreement shall be referred to the senior management of each Party who shall attempt to resolve the
dispute in good faith. To aid resolution by the Parties’ senior management, the City’s and Processor’s
representatives shall promptly prepare and exchange memoranda stating the issues in dispute and their
positions, summarizing the negotiations which have taken place and attaching relevant documents. If the
Parties’ senior management resolves the dispute, such resolution shall be reported in writing to and shall
be binding upon the Parties.
12.3 If, despite the good faith efforts described in Section 15.2, the Parties are unable to resolve a
dispute or claim arising out of or relating to this Agreement or its breach, termination, enforcement,
interpretation or validity, the Parties may seek to agree on a forum for mediation to be held at a mutually
agreeable site.
12.4 If, despite good faith efforts described in Section 15.2 and 15.3, the Parties are unable to resolve a
dispute or claim arising out of or relating to this Agreement or its breach, termination, enforcement,
interpretation or validity, (including the determination of the scope or applicability of this Agreement to
arbitrate), shall be determined by arbitration in the Tri-Cities, Washington before a single arbitrator who
is an experienced attorney in the discipline that is the subject of the dispute and whom shall be jointly
Page 26 of 43
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selected by the City and Processor. The arbitration shall be administered by JAMS or JDR pursuant to its
Comprehensive Arbitration Rules and Procedures. The arbitrator shall issue a reasoned, written decision.
Judgment may be entered upon the arbitrator’s decision in any court of competent jurisdiction, and each
Party agrees to submit to the personal jurisdiction of any such court for the purposes of any such actions
or proceedings to enter or enforce such judgement.
12.5 Should either party employ an attorney to enforce any of the provisions of this Agreement, the
non-prevailing Party in any final judgment agrees to pay the other Party’s reasonable expenses, including
reasonable attorneys’ fees and expenses in or out of litigation and, if in litigation, trial, appellate,
bankruptcy or other proceedings, expended or incurred in connection therewith, as determined by a court
of competent jurisdiction.
13. MISCELLANEOUS
13.1 Amendment and Waiver. No amendment or waiver of any provision of this Agreement shall be
valid unless contained within a written executed by Processor and the City and which references the
specific section to be amended or waived. No other amendment or waiver shall have any effect, regardless
of its formality, consideration, detrimental reliance or conduct of one or more Parties. Any waiver of any
term or condition hereof shall not be construed as a waiver of any subsequent breach or as a subsequent
waiver of the same term or condition, or a waiver of any other term or condition of this Agreement.
13.2 Assignment. Either Party or assigns as applicable, may assign its rights under this Agreement
without the consent of the other Party; provided that such Party will remain responsible for each of its
obligations under the Agreement, the assignor shall promptly send written notice to the other Party.
13.3 Effective Date; Counterparts; E-Signatures. This Agreement shall take effect and be in force on
the later date of each Party’s signature, below. This Agreement may be executed by the Parties in any
number of counterparts, each of which shall be deemed an original instrument, but all of which together
shall constitute but one and the same agreement. A signature of a Party transmitted to the other Party by
facsimile, PDF or other electronic means shall constitute the original signature of such Party for all
purposes (“Electronic Signature”).
13.4 Merger. This Agreement, including any Exhibits, contains the total agreement of the Parties, and
all agreements oral or written entered into prior to or contemporaneously with the execution of this
Agreement are excluded. This Agreement shall be binding upon the Parties, their successors and assigns.
13.5 Notice. Any notices or other communications required or permitted hereunder shall be in writing
and sent to the appropriate addresses designated below (or to such other address or addresses as may
hereafter be furnished by one Party to the other Party in compliance with the terms hereof), by hand
delivery, by electronic email (if listed below), by UPS, FedEx, or DHL next-day service, or by registered
or certified mail, return receipt requested, postage prepaid.
If to City:
Attn: City Manager, City of Pasco
525 N 3rd Avenue
PO Box 293
Pasco, WA 99301
If to Processor:
With a copy to:With a copy to:
efurguson@kerrlawgroup.net
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13.6 No Third-Party Beneficiaries. This Agreement is solely for the benefit of the Parties and their
respective successors, Lenders, and permitted assigns and, and nothing herein, express or implied, is
intended to or shall confer upon any other person any legal or equitable right, benefit or remedy of any
nature whatsoever under or by reason of this Agreement.
13.7 Severability. If any clause in this Agreement is deemed unenforceable or invalid, the balance of
the Agreement shall remain enforceable. [signature page follows]
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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the Effective Date.
PROCESSOR CITY OF PASCO, WASHINGTON
By:_________________________________ By:______________________________
Name:_______________________________ Name: Adam Lincoln
Title:________________________________ Title: City Manager
Date:________________________________ Date:_____________________________
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Exhibit A
System
The System is composed of the following primary components, as may be modified from time to time as
be necessary or convenient to treat Influent Wastewater and comply with System Permits: as may
Headworks & Grit Removal;
Equalization;
Anaerobic Reactors and Bypass Stations, including
a.Anaerobic Reactor System;
b.Bypass - Equalization to Aerobic Reactors; and
c.Bypass - Equalization to Pond Discharge Station.
Aerobic Treatment and Bypass Station, including
(a.) Aerobic Reactor System; and
(b) Bypass – Aerobic Treatment to Pond Discharge Station. Effluent Pump Station
Gas Processing; Multi-use Building;
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Exhibit B
CITY-OBLIGATIONS
The City will provide, the following wastewater treatment services to Processor with respect to the
System described in Exhibit A
1. Operation, Routine Maintenance, and Management of the System.
1.1. The City will be responsible for all operations and maintenance obligations required to
ensure operation of the System in accordance with the Agreement and an Ecology-approved
operations and maintenance manual.
1.2. The City will communicate with [Processor name] as is reasonable and necessary
regarding the City’s operation, routine maintenance, and management of the System.
2. Capital Improvements
2.1. The City will perform capital improvements and any maintenance or modifications.
2.2. Should Ecology or other applicable regulatory authority establish new effluent limits
under the Discharge Permit that potentially require modifications to the System, the City and
Processor shall cooperate to evaluate modification to the System. Processor is responsible for
paying for the costs of any such capital improvements as provided for in the Agreement and
Exhibit F.
3. State Waste Discharge Permit Compliance, Generally
The City is responsible for obtaining the State Waste Discharge Permit. Both the City and
Processor shall be responsible for Permit compliance for each Party’s respective services.
4. Performance Standards and Regulatory, Reporting, and Recordkeeping Requirements
4.1 The City’s responsibilities for performance standards and regulatory, reporting, and
recordkeeping requirements are solely and exclusively for the operation of the PWRF Systems.
All aspects of Processor facilities, including but not limited to implementation and enforcement
of the City’s pretreatment program, are the sole and exclusive responsibility of Processor .
4.2 For any monitoring and sampling requirements for Processor, including monitoring Influent
Wastewater prior to discharge to the PWRF, Processor will perform any laboratory analysis through an
accredited laboratory or as otherwise required by the Discharge Permit.
5. Metering; Wastewater Quality
5.1. City will install one or more meters as may be necessary to accurately measure the
amount and composition of Influent Wastewater delivered by Processor to the City for purposes
of billing Processor and other monitoring requirements as established in the Discharge Permit.
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5.2. The City will calibrate and maintain meter devices to ensure the accuracy of the
measurements is consistent with Prudent Industry Practices, the manufacturer’s recommendation,
and approved operation and maintenance manual procedures for the device and the waste stream.
The City will establish the calibration frequency for the Meter(s) that conforms to the frequency
recommended by the manufacturer.
5.3. Subject to reasonable advance notice, City will provide the Processor with access to the
Meter(s) during regular business hours for the purpose of inspecting or monitoring the quantity
and quality of Influent Wastewater.
5.4. Processor may request periodic testing of any Meter by providing written notice of such
request to the City. The City will conduct such testing; provided that the Processor may, at its
sole cost and expense, hire an independent third-party to conduct such testing. If, during any such
testing, the Meter is found to be within a five percent (5%) accuracy range, then the cost of such
test shall be borne by Processor. If the meter is inaccurate by more than five percent (5%), the
City shall at the City’s sole expense, cause the inaccuracy to be promptly corrected, and the
Parties agree that any amounts due or paid for any Services shall be adjusted by the same
percentage as the inaccuracy of the Meter, from the date of Processor name’s written request
through the date upon which the inaccuracy is corrected, as verified by an independent third-
party.
6. Payment of Permit Fees and Fines
6.1. The City is responsible for all State Waste Discharge Permit fees.
6.2. Processor is responsible for all City Permit fee and other rates and charges so long as
uniform for the same class of customers or service and facilities furnished. In classifying
customers served or service and facilities furnished by the PWRF, the City shall adhere to RCW
55, 67.020(2).
7. System Maintenance
7.1. Processor acknowledges that all City Obligations under this Agreement are subject to and
conditioned upon the City’s right and obligation to perform routine and periodic maintenance on
the PWRF systems and emergency maintenance as reasonably required from time to time.
7.2. The City shall provide Processor with advance notice of any routine and periodic maintenance
activities within ten (10) calendar days of the commencement of such routine and periodic
maintenance activities.
7.3.The City may perform emergency maintenance activities as reasonably required under the
circumstances. In the case of emergency maintenance activities, the City shall provide notice to
Processor as soon as practicable.
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Exhibit C
Processor Obligations
Processor shall supply Influent Wastewater in accordance with the following specifications:
Influent Characteristics to Wastewater Treatment System
[
Parameter Influent
Avg. Annual Daily Flow (MGD)TBD
Max. 28-Day Flow (MGD)TBD
BOD, Annual Avg. (mg/L)TBD
BOD, Annual Avg. Daily Load (lb/d)TBD
BOD, Load Max. Month (lb/d)TBD
TSS, Annual Avg. (mg/L)TBD
TSS, Annual Avg. Daily Load (lb/d)TBD
TSS, Load Max. 28-Day(lb/d)TBD
TN, Annual Avg. (mg/L)TBD
TN, Avg. Daily Load (lb/d) TBD
TN, Load Max. 28-Day (lb/d)TBD
Temperature (°F)TBD
Ph TBD
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Exhibit D
Pricing Schedule – Pretreatment Phase 3 System Costs Only
1. Base Treatment Fee: TBD
2. Adjusted Treatment Fee: TBD based on information from FCS Group
3. Annual Modifications to the Adjusted Treatment Fee
The Adjusted Treatment Fee will be subject to further modification as follows:
1- Commencing on COD, the City will modify the Adjusted Treatment Fee to reflect any percentage
adjustment in the Consumer Price Index measured from April 2022 to the month and year
immediately preceding the month and year in which COD occurs. This first modification of the
Adjusted Treatment Fee will be the Adjusted Treatment Fee calculated and invoiced by the City
through March 31 of the first calendar year occurring after the calendar year in which COD
occurs.
2- Commencing on April 1 of the first calendar year following the year in which COD occurs, and
occurring annually on April 1 of each calendar year through the Term, the City shall modify the
Adjusted Treatment Fee based on changes in the Consumer Price Index and/or increases in the
amount of Influent Wastewater or Non-Conforming Influent Wastewater accepted by the PWRF
system that occurred during the immediately preceding calendar year (e.g., a modified Adjusted
Treatment Fee will be calculated and take effect on April 1, 2025 to reflect circumstances
occurring from January 1, 2024 through December 31, 2024). The City will calculate such
annual modifications to Adjusted Treatment Fee as follows:
a. The then-current Adjusted Treatment Fee will be adjusted for any change in the
Consumer Price Index occurring from January 1 through December 31 of the prior
calendar year; provided, however, that on April 1 of the first calendar year occurring after
COD, such Consumer Price Index adjustment shall be measured from the month COD
occurred through December 31 of the prior year (e.g. if COD occurs Jun 1, 2024, the
adjustment will be measured from June 1, 2024 through December 31, 2024); and
b. If the System accepted more than [Processor Max annual flow] MG of Influent
Wastewater or Non-Conforming Influent Wastewater during the prior calendar year, the
Adjusted Treatment Fee will be increased by .03% per MG for each MG accepted above
[Processor Max annual flow] MG. There will be no adjustment for volume of wastewater
if the total volume of Influent Wastewater or Non-Conforming Influent Wastewater is
less than [Processor Max annual flow] MG.
Such annually modified Adjusted Treatment Fee shall remain fixed for the next twelve (12) months,
through March 31 of the subsequent year.
The City shall document any annual modifications to the Adjusted Treatment Fee and provide [Processor
name] a form summarizing the annual modification to the Adjusted Treatment Fee with the first invoice
issued after such modified Adjusted Treatment Fee goes into effect.
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4.Pass-Through Costs:
The following costs incurred by the City will be passed through to Processor for administrative costs, and
will be invoiced to Processor on a monthly basis:
o Electricity
o Purchased natural gas for system heating use
o Solid waste disposal (including anaerobic sludge and periodic digester scrapes and clean-
outs)
o Consumables (including replacement parts & associated rental equipment)
o Major Maintenance Expenses
Page 35 of 43
1201 Wilson Blvd, 27th Floor, Arlington, VA. 22209 732.284.4640
burnhamrng.com
February 23, 2023
Steve M. Worley
Public Works Director
City of Pasco
525 N. 3rd Avenue
Pasco, WA 99301
Dear Steve,
I write in response to letters that were submitted to the Pasco City Council regarding the Council’s
consideration of the Processor Wastewater Treatment Agreement for the PWRF Phase 3 Project. My
intention is to offer some clarity around issues raised in those letters.
First, I believe it’s important to highlight that while this project is complex, we have assembled a highly
capable and experienced team to execute it. Burnham is responsible for the development, financing, and
overall asset management for the project, as well as for assembling the various technical experts needed
within each discipline. The combined Burnham team has years of experience in this exact role on a range
of projects, including projects more complex and larger than the PWRF Phase 3 Project. We have brought
in a world-class team to execute each technical discipline on the project, including to design the treatment
system, engineer and construct it, and provide O&M services. I am confident the right team is in place to
make this project successful.
Second, it is evident that the renewable natural gas (“RNG”) element of the project continues to create
confusion. First of all, we have already secured a 20-year fixed-price contract for the RNG with a large gas
utility. This contract should eliminate concerns around potential pricing or demand volatility in the RNG
market.
Further, the concern that Burnham is taking $350,000 per month in RNG revenue is misplaced. There is a
$350,000 base assumption on monthly RNG revenue that drives the calculations as to whether or not we
are above or below expected base revenue each month. This was the number used to calculate the base
treatment fee, which would have been higher if not for the presence of RNG sales. Both City staff and FCS
have gone through the calculations in detail and understand and agree that all of the benefit of RNG sales
is being provided to the project.
While the focus of the project is clearly and unequivocally wastewater treatment, the RNG provides an
enormous financial benefit. In the simplest terms1, the RNG system costs $25 million to build, generates
an estimated federal tax credit $30 million and further generates ~$6 million per year of revenue ($180
million over 30 years).
Finally, concerns have been raised about the Wastewater Treatment Agreement we have negotiated with
the City. The contract is the result of a careful weighing of risks, benefits, trade-offs, and agreements
between Burnham and the City. Processors have had access to draft agreements since May and have not
previously taken the opportunity to comment to our knowledge. To the extent that the City wants to re-
1 Illustrative, round numbers used for simplicity
Page 36 of 43
1201 Wilson Blvd, 27th Floor, Arlington, VA. 22209 732.284.4640
burnhamrng.com
open commercial concerns at behest of the Processors, we will consider modifications. In this letter,
however, I will only address clear misconceptions that have been raised.
• Performance Guarantees on Gross Wen Process: Since drafting the agreement, Burnham has
secured a performance guarantee on the Gross Wen process from Swinerton that will be passed
through to the City via the provisions of 3.1(i).
• No Financial Requirements of Burnham: We are required by the agreement to spend the
estimated >$130 million to build this plant on behalf of the City and Processors. There are multiple
firm obligations on Burnham (Section 3) and significant penalties for non-performance (Sections
6 and 7) including City’s ability to take over the facility (7.4a), wiping out Burnham’s equity
investment. In addition, Burnham and the City have subsequently agreed to a contractual
modification that will require Burnham to obtain a performance bond at the City’s request.
• No Cost Containment Provisions: In Exhibit F, Item 1 “adjustments cannot exceed
$170,000/month” which is a cap, albeit with negotiated exceptions. The exceptions would be
unnecessary if we could finalize this agreement and move forward with the work. It’s also worth
noting that Swinerton is on a Guaranteed Max Price contract with Burnham, further insulating the
project from cost overruns.
The intention of this letter is not to discourage important discussion nor is it to suggest that comments
are not welcomed. We find these comments to be constructive and are grateful for the input. Our goal is
to serve as a partner to the City and the Processors. We have always maintained an open approach to
the ideas and requests of all parties, and we continue to stand ready to work with our partners as
requested.
Thank you,
Chris Tynan
CEO
Burnham RNG, LLC
CC:
Blanche Barajas, Mayor
Craig Maloney, Mayor Pro-Temp
Joseph Campos, City Councilmember
Irving Brown, Sr., City Councilmember
Pete Serrano, City Councilmember
David Milne, City Councilmember
Zahra Roach, City Councilmember
Adam Lincoln, City Manager
Page 37 of 43
Pasco Processing
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)435
Avg. Annual Daily Flow (MGD)1.19
Max. Month Flow (MGD)2.50
BOD, Annual Avg. (mg/L)3,018
BOD, Annual Avg. Daily Load (lb/d)30,000
BOD, Load Max. Month (lb/d)65,000
TSS, Annual Avg. (mg/L)1,600
TSS, Annual Avg. Daily Load (lb/d)15,910
TSS, Load Max Month (lb/d)42,500
TN, Annual Avg. (mg/L)64
TN, Avg. Daily Load (lb/d)670
FDS, Annual Avg. (mg/L)475
FDS, Avg. Daily Load (lb/d)4,700
pH (s.u.)5.0 – 11.0
Freeze Pack
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)25
Avg. Annual Daily Flow (MGD)0.07
Max. Month Flow (MGD)0.11
BOD, Annual Avg. (mg/L)236
BOD, Annual Avg. Daily Load (lb/d)135
BOD, Load Max. Month (lb/d)225
TSS, Annual Avg. (mg/L)236
TSS, Annual Avg. Daily Load (lb/d)140
TSS, Load Max Month (lb/d)225
TN, Annual Avg. (mg/L)70
TN, Avg. Daily Load (lb/d)40
FDS, Annual Avg. (mg/L)515
FDS, Avg. Daily Load (lb/d)300
pH (s.u.)5.0 – 11.0
Page 38 of 43
Twin City Foods
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)225
Avg. Annual Daily Flow (MGD)0.62
Max. Month Flow (MGD)1.80
BOD, Annual Avg. (mg/L)7,197
BOD, Annual Avg. Daily Load (lb/d)37,000
BOD, Load Max. Month (lb/d)105,000
TSS, Annual Avg. (mg/L)2,640
TSS, Annual Avg. Daily Load (lb/d)13,580
TSS, Load Max Month (lb/d)50,800
TN, Annual Avg. (mg/L)117
TN, Avg. Daily Load (lb/d)620
FDS, Annual Avg. (mg/L)515
FDS, Avg. Daily Load (lb/d)2,600
pH (s.u.)5.0 – 11.0
Reser’s
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)127
Avg. Annual Daily Flow (MGD)0.41
Max. Month Flow (MGD)0.41
BOD, Annual Avg. (mg/L)2,130
BOD, Annual Avg. Daily Load (lb/d)7,300
BOD, Load Max. Month (lb/d)10,200
TSS, Annual Avg. (mg/L)2,130
TSS, Annual Avg. Daily Load (lb/d)7,310
TSS, Load Max Month (lb/d)10,800
TN, Annual Avg. (mg/L)80
TN, Avg. Daily Load (lb/d)230
FDS, Annual Avg. (mg/L)730
FDS, Avg. Daily Load (lb/d)2,500
pH (s.u.)5.0 – 11.0
Page 39 of 43
Simplot
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)255
Avg. Annual Daily Flow (MGD)0.70
Max. Month Flow (MGD)1.25
BOD, Annual Avg. (mg/L)3,467
BOD, Annual Avg. Daily Load (lb/d)20,200
BOD, Load Max. Month (lb/d)70,000
TSS, Annual Avg. (mg/L)2,120
TSS, Annual Avg. Daily Load (lb/d)12,360
TSS, Load Max Month (lb/d)20,000
TN, Annual Avg. (mg/L)91
TN, Avg. Daily Load (lb/d)410
FDS, Annual Avg. (mg/L)530
FDS, Avg. Daily Load (lb/d)3,100
pH (s.u.)5.0 – 11.0
Grimmway
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)254
Processing Period* Avg. Daily Flow (MGD)1.19
Max. Month Flow (MGD)1.65
BOD, Annual Avg. (mg/L)2,700
BOD, Processing Period* Avg. Daily Load (lb/d)26,730
BOD, Load Max. Month (lb/d)37,150
TSS, Annual Avg. (mg/L)1,000
TSS, Annual Avg. Processing Period Daily Load (lb/d)9,900
TSS, Load Max Month (lb/d)13,770
TN, Annual Avg. (mg/L)21
TN, Avg. Daily Load (lb/d)120
TN, Processing Period* Avg. Daily Load (lb/d)210
FDS, Annual Avg. (mg/L)360
FDS, Avg. Daily Load (lb/d)2,100
FDS, Processing Period* Avg. Daily Load (lb/d)3,560
pH (s.u.)5.0 – 11.0
*Processing period used is June Through December, which includes start-
up and clean-up flow/loading
Page 40 of 43
Darigold WW
Projected Design Criteria
Parameter Influent
Total Annual Flow (MGD)256
Avg. Annual Daily Flow (MGD)0.70
Max. Month Flow (MGD)0.84
BOD, Annual Avg. (mg/L)3,009
BOD, Annual Avg. Daily Load (lb/d)17,600
BOD, Load Max. Month (lb/d)24,600
TSS, Annual Avg. (mg/L)397
TSS, Annual Avg. Daily Load (lb/d)2,330
TSS, Load Max Month (lb/d)2,790
TN, Annual Avg. (mg/L)197
TN, Avg. Daily Load (lb/d)1,150
FDS, Annual Avg. (mg/L)1,655
FDS, Avg. Daily Load (lb/d)9,700
pH (s.u.)5.0 – 11.0
Page 41 of 43
Gross-Wen Technologies Inc.
404 Main St. Slater, IA 50244
ALGAE.COM
Mr. Steve Worley
Pasco City Hall
525 N 3rd Avenue
Pasco, WA 99301
RE: Response to Processor Letters Dated February 21, 2023
Mr. Worley,
On February 21, 2023 you received two letters from resident processors, Simplot and Grimmway Farms. Please
submit this letter to City Council in respectful response to those letters for the public record on behalf of Gross-Wen
Technologies, Inc.
History
While GWT is a relatively new company, the RAB technology was originally developed in 2013. The first full-scale RAB
system was deployed in 2016. Since then, multiple full-scale projects have been deployed which have demonstrated
the efficacy of the technology.
GWT is and will remain a wastewater treatment company. And the inclusion of the technology for this project is first
and foremost to reduce the nutrient concentration in the wastewater.
One of the many benefits of using the RAB system is the nitrogen-rich algae. However, this is not the primary focus
for this or any project that GWT is involved.
Scalability & Scrutiny
concentrations of nutrients. The City, Burnham, 3rd Party Consultants Montrose and E3, and the Washington
Department of Ecology have all taken measures to thoroughly scrutinize the RAB solution including pilot
methodology, sizing models, and final design proposal. All parties have collectively decided that the RAB is the
preferred solution.
Page 42 of 43
Gross-Wen Technologies Inc.
404 Main St. Slater, IA 50244
ALGAE.COM
Process Guarantee
Additionally, GWT is providing a process guarantee, through Swinerton, to Burnham, and ultimately the City and
Processors. The Process Guarantee states that GWT will meet the nitrogen removals required by Ecology, however, in
the event that the solution does not meet requirements, predefined remedies will be implemented by GWT &
Burnham.
Life Cycle Cost Analysis
Burnham developed a comprehensive 30-year life cycle cost analysis between nitrogen removal technologies. The
analysis revealed that the RAB solution provides the least expensive nitrogen removal solution even with a higher
capital cost, primarily due to the low energy required and the value of the algae biomass. This analysis did not
include any grant funding that the City will possibly obtain exclusively due to the RABs inclusion in the project.
Removal of Total Dissolved Solids (TDS)
Metro Water Reclamation District (MWRD) of Chicago conducted a full-
remove TDS from wastewater. While the RAB was not selected as a TDS removal technology, it is anticipated that
some TDS will be assimilated by the algal biomass. Upon start up and commissioning, GWT will work with the City
and Burnham to provide monitoring consistent with the anticipated TDS compliance schedule from Ecology. GWT
makes no claim that compliance will be achieved without further treatment, but it is possible that the RABs inclusion
will provide the additional benefit of TDS removal to the project.
Lastly, as I mentioned at the City Council meeting on February 21st, we are grateful for your leadership and the
opportunity to be a part of this important project.
Sincerely,
Philip Gates
GWT - Vice President
Martin Gross, PhD
GWT President & CEO
Page 43 of 43