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HomeMy WebLinkAbout4249 Resolution - Process Water Reuse Facility (PWRF) Interim Agreement - DarigoldRESOLUTION NO. 4249 A RESOLUTION OF THE CITY OF PASCO, WASHINGTON, AUTHORIZING THE CITY MANAGER TO EXECUTE AN INTERIM AGREEMENT WITH DARIGOLD, INC., FOR THE PROCESS WATER REUSE FACILITY PHASE 3 PROJECT. WHEREAS, the City owns, operates, and maintains a Washington State Department of Ecology (Ecology) -approved Process Water Reuse Facility (PWRF) and 14 nearby City -owned farm circles for the final treatment and disposal of over 900 million gallons of industrial wastewater from several local agricultural processing plants; and WHEREAS, Darigold plans to build a large butter and protein powder processing plant currently scheduled to begin ramping up operation of the plant beginning February 2024 and be operational by July 2024; and WHEREAS, the City has need to upgrade and increase treatment capacity of the PWRF, increase winter storage pond capacity, and increase the land treatment system to accommodate the treatment of Darigold's two wastewater streams along with the increased growth in Pasco's agricultural processing market; and WHEREAS, the City and a Developer plan to design and build two anaerobic digesters, a biological nitrogen removal system, and a renewable natural gas (RNG) plant, hereinafter referred to as the "Project" that would pretreat Darigold's wastewater prior to being disposed of via irrigation to said farm circles, and the value associated with the sale of RNG will likely help reduce Darigold's financial obligation related to the cost for treatment and disposal of their wastewater streams; and WHEREAS, the City has determined that the anaerobic digesters, biological nitrogen removal system, and RNG plant are the preferred methods to pretreat Darigold's wastewater prior to final disposal; and WHEREAS, this Interim Agreement is legally binding and shall be in full force and effect until replaced with a long-term agreement addressing Darigold's future payments to the City for the treatment and disposal of Darigold's industrial wastewater; and WHEREAS, Darigold and the City agree, based upon the Parties' representations, it is in the interest of both Parties to enter into this Interim Agreement for the mutual benefit of both Parties. Resolution - Interim Agr. w/ Darigold for the PWRF - 1 NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON: That the City Manager, for the City of Pasco, is hereby authorized to execute the Interim Agreement with Darigold, Inc. for the Process Water Reuse Facility Phase 3 project, a copy of which is attached hereto, and incorporated by this reference as Exhibit A; and is hereby authorized to make minor substantive changes to said Agreement as needed. Be It Further Resolved, that this Resolution shall take effect immediately. PASSED by the City Council of the City of Pasco, Washington, this 19th day of September, 2022. V V^ Citi. y JNVV Blanche Barajas f -or Mayor ATTEST: Debra Barham, CMC City Clerk Resolution - Interim Agr. w/ Darigold for the PWRF - 2 APPROVED AS TO FORM: INTERIM AGREEMENT PASCO PROCESS WATER REUSE FACILITY (PWRF) DARIGOLD, INC. THIS INTERIM AGREEMENT between the City of Pasco, a Washington Municipal Corporation, hereinafter referred to as "City", and Darigold, Inc, hereinafter referred to as "Darigold" (the "Interim Agreement"), collectively referred to as "Parties", is entered into for the purpose of the City agreeing to accept Darigold's Industrial Wastewater and Condensate of Whey ("COW") Water, in accordance with the following terms and conditions. WHEREAS, the City owns, operates, and maintains a WA State Department of Ecology (`Ecology") -approved Process Water Reuse Facility ("PWRF") and 14 nearby City -owned farm circles for the final treatment and disposal of over 900 million gallons of industrial wastewater from several local agricultural processing plants; and WHEREAS, the Pasco Municipal Code (PMC) Chapter 13.55 specifies the connection requirements, monthly charges, rate modifications and new users, as well as usage limitations for the PWRF; and WHEREAS, Darigold plans to build a large butter and protein powder processing plant currently scheduled to begin ramping up operation of the plant beginning February 2024 and be operational by July 2024; and WHEREAS, the City has need to upgrade and increase treatment capacity of the PWRF, increase winter storage pond capacity, and increase the land treatment system to accommodate the treatment of Darigold's two wastewater streams along with the increased growth in Pasco's agricultural processing market; and WHEREAS, the City and a Developer plan to design and build two anaerobic digesters, a biological nitrogen removal system, and a renewable natural gas ("RNG") plant (hereinafter referred to as the `Project') that would pretreat Darigold's wastewater prior to being disposed of via irrigation to said farm circles, and the value associated with the sale of RNG will likely help reduce Darigold's financial obligation related to the cost for treatment and disposal of their wastewater streams; and WHEREAS, the City has determined that the anaerobic digesters, biological nitrogen removal system, and RNG plant are the preferred methods to pretreat Darigold's wastewater prior to final disposal; and WHEREAS, this Interim Agreement is legally binding and shall be in full force and effect until replaced with a long-term agreement addressing Darigold's future payments to the City for the treatment and disposal of Darigold's industrial wastewater; and Interim Agreement — Darigold Industrial Wastewater to PWRF Page 1 of 3 WHEREAS, Darigold and City agree, based upon the Parties' above representations, it is in the interest of both Parties to enter into this Interim Agreement for the mutual benefit of both Parties. NOW, THEREFORE, BY THIS INTERIM AGREEMENT, the Parties agree to the following: 1. City agrees to faithfully move forward with a Developer on the design and construction of the Project. 2. Darigold agrees to faithfully coordinate with and support the City's and Developer's efforts on the expedient design and construction of the Project. 3. City agrees to accept Darigold's industrial wastewater and COW water in accordance with the following schedule: Volume 20,000 (gallons/day) Cumulative 600 000 40,000 50,000 100,000 132,866 381,991 Volume 1 1,800,000 3,300,000 6,300,000 10,285,980 21,745,680 (gallons * The combined quantity of both industrial wastewater and COW water will gradually increase each month thereafter to a maximum volume of 1.5 million gallons per day 4. City agrees to accept Darigold's industrial wastewater and COW water even if the Project is not yet fully operational. 5. Darigold agrees to pay City $20,410.00 per month beginning February 2024 and said payment shall continue each month until the Darigold plant is fully operational, and this Interim Agreement is replaced by a permanent agreement, which will include agreed upon future costs and be in compliance with PMC 13.55, as amended. 6. Darigold agrees to pay any additional Project costs, not to exceed $500,000.00 specifically related to the accelerated schedule necessary to meet the February 2024 deadline. Costs will be determined and reviewed by the Parties as soon as said costs become available. 7. Any notice or information required or permitted to be given to the parties related to this Interim Agreement shall be to the following addresses, unless otherwise specified: City of Pasco Mr. Dave Zabell, City Manager 525 North 3rd Pasco, WA 99301 (509) 545-3404 zabelldApasco-wa. gov Darigold, Inc. Attn: General Counsel 5601 6t' Ave S, Suite #300 Seattle, WA 98108 Notice shall be deemed given upon receipt of personal delivery or five (5) days after deposit in the United States Mail in the case of regular mail, or next day in the case of overnight delivery. Interim Agreement — Darigold Industrial Wastewater to PWRF Page 2 of 3 8. This Interim Agreement and any non -contractual obligations arising out of or in connection herewith, shall be construed in accordance with, and governed by, the laws of the State of Washington. Notwithstanding the foregoing, Darigold agrees to hold the City of Pasco harmless of any requirement to provide wastewater services should the City be ordered not to provide services by a court of competent jurisdiction. This Interim Agreement shall become effective upon the date of signature approval by the last parry as indicated below. DATED this day of , 2022. CITY OF PASCO, WASHINGTON: LIN Dave Zabell, City Manager DARIGOLD, INC. : Joe Coote Title: CEO Interim Agreement — Darigold Industrial Wastewater to PWRF Page 3 of 3