HomeMy WebLinkAbout4334 Resolution - Processor Wastewater Treatment Agreement RESOLUTION NO.4334
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 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 with Burnham SEV, Burnham SEV 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, upon approval of the City Council and entering into an agreement with
Burnham SEV, the Processors agree to pay City a Base Treatment Fee and/or an Adjustment
Treatment Fee as described herein and shown in Exh'ibit A.
NOW,THEREFORE,BE IT RESOLVED SY THE CITY COUNCIL OF THE CITY
OF PASCO, WASHINGTON:
Resolution—Pasco Processors Wastewater Treatment Agreement- 1
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 consistent with the intent of the City Council.
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,this 3rd day of April,2023.
Blanche Barajas
Mayor
ATTEST: APPROVED AS TO FORM:
f�`--
Debra Barham, CMC Ke guson Law, PLLC
City Clerk ' y Attorneys
Resolution—Pasco Processors Wastewater Treatment Agreement-2
4/3f23, 17:10 AM Pasco-Processors Water Treatment Agreement(002)
CITY OF PASCO—PROCESS WATER REUSE FACILITY(PWRF)
INDUSTRIAL WA5TEWATER 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 1854 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
clari�er, 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 Depariment 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 treattnent 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 treatrnent and nitrogen removal system (the
"System," as more particularly described in E�chibit 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
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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 from rates and fees paid to the City
by processors, including Processor. This Agreement provides for Processor agreement to
pay City for a Base Treatment Fee and Adjustment Treattnent 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. DEFI1vITIONS
See Exhibit E
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 4.2.
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. PROCE5SOR OBLIGATIONS
In addition to any other obligations set forth herein, including any obligations in Exhibit C,
Processor shall comply with the following obligations(each a"Processor Obligation"and
together the"Processor Obligations"):
5.1 Effluent Wastewater. Commencing on written notice from City and continuing
throughout the Term, Processor shall at its sole cost and expense deliver to City all Effluent
Wastewater produced within the City,in accordance with the specifications in Exhibit C.
If at any time City becomes aware that Effluent Wastewater delivered by Processor is Non-
Conforming Effluent Wastewater,after thiriy(30)days written notice to Processor and a
failure to cure by Processor, City may,in its reasonable discretion, choose to refuse,accept
or bypass such Non-Conforming Ef�luent Wastewater;provided, however, that City's
acceptance of Non-Conforming Effluent Wastewater shall not relieve Processor of any
responsibility or any costs,damages,or liabilities associated with Non-Conforming Effluent
Wastewater,including but not limited to costs of alternative handling,treatment and disposal.
The City does not waive any other rights or remedies associated with Processor's delivery of
Non-Conforming Effluent Wastewater.
5.2 Payment.Processor shall pay City in accordance with Section 7.
5.3 If there are any changes in Processor's ability to comply with the Processor's
Obligations in Exhibit C_(not excused by a Force Majeure event),any change in
circuxnstances,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 reasonable costs
incurred by City to operate the System due to such Changed Circumstances. The Parties
agree to negotiate in good faith any necessary Modifications in accordance with Section 7.3
to accommodate any Changed Circumstances.
6. CITY OBLIGATIONS
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6.1 In addition to any other obligations set forth herein,including any obligations in
Exhibit B,City shall comply with the following obligations(each a"City Obligation"and
together the"City Obligations"):
b.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 ORDER5
7.1 Commencing on written notice from City and continuing throughout the Term,
Processor shall pay City the Adjusted Treatrnent Fee,Pass-Through Costs, and any
applicable adjustments as calculated in accordance with this Agreement and invoiced by City
monthly in accordance with Exhibit D. 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 Effluent Wastewater or temporary failure or inability of City
to accept Influent Wastewater.
Processor shall pay each City invoice within thirty(30)calendar days after receipt;provided,
however,that Processor may,in good faith,dispute the correctness of any invoice,upon
written notice to the City, stating the basis for the dispute or adjustment;provided further,
however,that Processor shall remain obligated to pay all undisputed amounts when due.
Payment will be made by check,cash, or electronic funds transfer,or by another mutually
agreeable method(s),to the account determined by the City.
73 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 perfortnance of the System or Services(together
"Modifications"). City agrees to reasonably cooperate with Processor in good faith 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 Pariy:
a. The Processor's failure to make any undisputed payrnent required under this
Agreement and invoiced by the City in accordance with Section 7;provided,
however, that City shall provide written notice of such failure to Processor and
Processor shall have thirty(30)days to submit payment in full(including any
interest or penalties) following such notice;
b. An Effluent Wastewater failure(defined as wastewater not meeting requirements
outlined in Exhibit C) ,not excused by a Force Majeure event, of cause and
sufficient duration to be a Material Breach.
c. The City's failure to provide Processor the services outlined in Exhibit B for a
period of one-hundred eighty(180)days or more due to the System's inability to
provide such wastewater treatment services.
d. In respect of either Party,the other Pariy's material misrepresentation,fraud,or
intentional misconduct in connection with this Agreement.
e. In respect of either Party,an Insolvency Event for that Pariy.
9. REMEDIES; CROSS-DEFAULTS
9.1 Remedies for Non-Material Sreach Due to Effluent Wastewater Failure. The
Processor's temporary failure or inability to meet the Effluent Wastewater specificarions
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listed in Exhibit C("Effluent Wastewater Failure") shall be a Non-Material Breach of this
Agreement.
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 9.4.
Such remedies in this Section 9.2,or otherwise, shall be non-exclusive,and every other right
and remedy shall 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.
9.3 Notwithstanding the above, if the Effluent Wastewater Failure was caused by
Processor's delivery of Non-Conforming Effluent 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 Effluent Wastewater in accordance with Exhibit
C or delivers Non-Conforming Effluent Wastewater,the City shall promptly notify Processor
of such failure and Processor shall be solely responsible for any and all losses and damage to
the System, or additional reasonable costs incurred by the City or its contractors that were
caused by Processor's failure or delivery of Non-Conforming Effluent Wastewater,
including without limitation any additional reasonable costs of treating,handling, storing,
and disposing of such Non-Conforming Effluent Wastewater.
9.4.2 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 perfortning 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
(� 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 thiriy
(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 12.
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 Effluent Wastewater from Processor at the System,the City shall
provide for alternative treatment and handling of the Processor Effluent wastewater on an
emergency basis or otherwise.
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) T'he greater of(1)the undiscounted value of Processor's payrnents to the City for the
remainder of the Term(}, as reasonably calculated by the City,in accordance with
Exhibit D,or(2)a proportionate share of any Outstanding Debt; and
(b) A proportionate amount related to Processor of the total amount owed by the City to
Burnham for impacts on PWRF, caused by the need to terminate this Agreement as a
result of Processor's Material Breach. . Notwithstanding the foregoing, as required by
applicable law,the City shall be required to mitigate damages, and all damages mitigated
shall be deducted from amounts owing by Processor.
9.7 Good Faith Effort to Resolve Disputes
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
10.1 Each Party represents and warrants that it has full power and authority under the
laws of the State of 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 F REPRESENTATIONS AND ARRANTIE . EXCEPT AS
EXPRESSLY SET FORTH IN THIS AGREEMENT,EACH PARTY MAKES NO
WARRANTY OR REPRESENTATION OF ANY K1ND WHATSOEVER,EXPRESS,
OR IMPLIED.ALL IMPLIED WARRANTIES INCLUDING,WITHOUT
LIMITATION,WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PIJRPOSE 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
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emergency or other unforeseeable circumstances beyond its reasonable control(a"Force
Majeure"),then written notice setting out the reason for non-perfortnance shall be given t�
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 9.7,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 9.7 and 12.3,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 selected by the City and
Processor.
The arbitration shall be administered by JAM5 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 Pariy 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 writing 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.
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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 hereo fl,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. Notice shall be effective upon receipt.
If to City: If to Processor:
Attn: City Manager,City of Pasco
525 N 3`d Avenue
PO Box 293
Pasco,WA 99301
With a copy to: With a copy to:
efurguson@kerrlawgroup.net
13.6 No Third-Pariy 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.
13.8 Consequential Damages. Notwithstanding anything in this Agreement to the contrary,
in no event will either Party be liable for any indirect,punitive, special,or consequential
damages relating to the Agreement,including but not limited to lost profits, even if such
Party has been advised of the possibility of such damages.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
by their duly authorized representarives as of the Effective Date.
PROCESSOR CITY OF PASCO,
WASHINGTON
By:
By:
Name: Name: Adam Lincoln
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Title: Title: Interim
City Manager
Date:
Date:
Exhibit A
System
The System is composed of the following primary components, as may be modified from
time to tirne as be necessary or convenient to treat Influent Wastewater and comply with
System Permits:
Headworks & Grit Removal: a system that accepts the Influent Wastewater (pumped by
Processor), removes grit and other inorganic material, and routes the Influent Water to the
next process.
Equalization: a system that collects Influent Wastewater and meters it out in a controlled
manner to the next process.
Anaerobic Reactors and Bypass Stations,including_
a. Anaerobic Reactor System;
b. Bypass-Equalization to Aerobic Reactors; and
c. Bypass-Equalization to Pond Discharge Station.
Nitrogen Reduction System and Bypass Station,including_
(a.) Nitrogen Reduction System; and
(6) Bypass—Nitrogen Reduction System to Pond Discharge Station.
System Effluent Pump Station
Gas Processing
Mt�lti-use Building
Exhibit B
CITY OBLIGATIONS
The City will provide,the following wastewater treatment services to Processor with respect
to the System described in E�ibit A
1. Operation,Routine Maintenance, and Management of the System.
2.1. The City will be responsible for all operations and maintenance obligarions required
to ensure operation of the System in accordance with the Agreement and an
Ecology-approved operations and maintenance manual.
2.2. The City will communicate with Processor as is reasonable and necessary regarding
the City's operation,routine maintenance, and management of the System.
3. CapitalImprovements
3.1. The City will perform capital improvements and any maintenance ar modifications.
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3.2. Should Ecology or other applicable regulatory authority establish new effluent
limits under the Discharge Permit that potentially require modifications to the
5ystem,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.
3.3. Should the proposed nitrogen reduction system not perform as required to meet
City's permit with Ecology,the City will call upon the performance guarantees of
Gross-Wen Technologies and Burnham and have a Moving Bed Bio Reactor
(MBBR) system of sufficient size installed at no additional cost to Processor.
4. 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.
5. Performance Standards and Regulatory, Reporting, and Recordkeeping
Requirements
5.1. 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.
5.2. 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.
6. Metering;Wastewater Quality
6.1. 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.
6.2. The City will calibrate and maintain meter devices to ensure the accuracy of the
measurements is consistent with Prudent Indusriy Practices,the manufacturer's
recommendation, and approved operation and maintenance manual procedures for
the device and the waste stream.The City will establish the calibrarion frequency
for the Meter(s)that conforms to the frequency recommended by the manufacturer.
6.3. 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.
6.4. 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.
7. Payment of Permit Fees and Fines
7.1. The City is responsible for all State Waste Discharge Permit fees.
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7.2. 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).
8. System Maintenance
8.1. 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.
8.2. 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.
8.3. 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.
Exhibit C
Processor Obligations
Processor shall supply Effluent Wastewater in accordance with the following specifications:
Influent Characteristics to Wastewater Treatment System
Parameter Effluent
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) �D
TSS,Annual Avg. (mg/L) ,I,BD
�
TSS,Annual Avg.Daily Load(lb/d) ,I,BD
TSS,Load Ma1c.28-Day(lb/d) ,I,BD
TN,Annual Avg.(mg/L) TBD
TN,Avg.Daily Load(Ib/d) ,TBD
TN,Load Malc.28-Day(lb/d) TBD
Temperature(°F) T.BD
Ph TBD
Exhibit D
Pricing Schedule—Pretreatment Phase 3 System Costs Only
1. Base Treatment Fee: TBD
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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 l, 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 adjustrnent
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 Treatrnent 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 Treatrnent Fee goes
into effect.
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 monthly:
a 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
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Exhibit E
Definitions
"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.
"Adjusted Treatment Fee"has the meaning given in Exhi i D.
"Base Treatment Fee"has the meaning given in Exhibit D..
"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.
"Changed Circumstances"has the meaning given in Section 5.3.
"City Facilities"has the meaning given in Agreement 5ection 2.3.
"City Obligation(s)"has the meaning given in Section 6.
"Commercial Operation"means the System is capable of processing Influent Wastewater
sufficient to meet the Ei�luent 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.
"COD"means the actual date upon which the System reaches Commercial Operation.
"Consumer Price Index"means the United States Departrnent 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.
"Discharge PermiY'has the meaning given in Agreement Section 2.3.
"Ecology"means the Washington State Department of Ecology.
"Effective Date"has the meaning given inAgreement Section 133.
"Effluent Wastewater"means agricultural or dairy industrial wastewater, as measured at the
point Processor wastewater is discharged from Processor's plant to the PWRF,that meets
the specifications in Exhibit C.
"Effluent Wastewater Failure"has the meaning given in Section 9.1.
"Influent Wastewater"means the combination of 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 Exhibit C,as measured at the point at which the
Processor Effluent Wastewater is delivered to the PWRF as more particularly described in
E�ibit A�l�.
"Initial Term"has the meaning given in Section 3.38.
"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
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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 Pariy or any substantial part of
its properiy,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.
"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.
"Material Breach"has the meaning given in section 8.2.
"MG"means million gallon(s).
"Modifications"has the meaning given in Section 7.3.
"Non-Conforming Effluent 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 Exhibit .
"Non-Material Breach"has the meaning given in Secrion 8.1.
"Pass-Through Costs"has the meaning given in Exhibit D .
"Permits"means the permits, clearances, approvals, authorizations,variances,or consents of
the City,including all amendments thereto and replacements thereof,that must be obtained
and/or maintained for Processor's discharge of Effluent Wastewater to the System.
"Processors"means the collective of all food product Processors that discharge their
industrial wastewater to the PWRF,including Processor.
"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.
"Prudent Industry Practices"means any of the practices,methods and acts engaged in or
approved by a significant portion of the wastewater treahnent 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.
"PWRF"has the meaning given in Agreement 5ection 2.1.
"Remedy"has the meaning given in Section 9.5.
"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.
"Renewal Term"has the meaning given in Section4.2.
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"Services"means the services to be provided by the City, its subcontractors,agents, or
assigns,under this Agreement,as set forth in Exhi i B.
"System"means the City-and Burnham-supplied industrial wastewater treatment and RNG
production facility and ancillary components as set forth in Exhibit A.
"Term"has the meaning given in Section 4.
"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.
1
FG: 100895287.5
�l�NTD:monitoring locations for influent and effluent return(s).
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Exhibit B
Rasco Cifiy of Pas�� ,
�� PWRF R�te �tudy�Ct}�A �
�� Scenaria Comparison �
�edine s«,raria-wrth uvd�dsrorage�cat�-n��w�
Pha�e 1 Pl�e 4 Rfiase 1 F t::=:'e
=.-...= ..... • --- , . _. _ : .' :. - . . ._. . _ . . .: `.:-
Twr C�y,�oods ": .. �_ ,-. _ .. :5.1U3 - � . . ;yt
4�er>re"s 1+Mw F'SatY -.`�'".. . ._... ' ;,c, : ;s:�
�"Rl$8t . .. .'.��c.•. '._ . . .' ' . -. - _.. ... . ..
�'.7ffN3'p +"� ' _ �. -. � -. ... - ,..
�3°i:��7 el�Yi _ -.. _ , ... , _ .
Tub! ; 4,681.291 t �.129.44� f 925.3� i 230,�.46 i 296:375 f 2�15,1Y'� 5 282,453
� -
_ —_ --- — . , -. . . , '1'�;� � 4,.�24.17� �
r:a_e=': . : ::4': 3 3�.915 �
Fx : =::�?s :_: _. ' ' ..:' ; 2,i5i,173
�;s_. . ...��: . . . : � . ',Ps 1,321,9T3 �
_. _. �.' . :: _ . _._ -� x 3,IOS,3l2
�� . _::_. ::. .._ .::-- � E,7Zi,T41 �
lfrc�[`.Y s ��:a5�1st f t�.s90.547j f (3.200,0001 S 2t,i98,�1