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1994/12/14 OUA & Beach Water-Operational Agt Draft 1 DRA ri DATE, 444 OPERATIONAL AGREEMENT BETWEEN OKEECHOBEE UTILITY AUTHORITY AND OKEECHOBEE BEACH WATER ASSOCIATION, INC. THIS AGREEMENT, made and entered into this day of 1994, by and between the OKEECHOBEE UTILITY AUTHORITY, hereinafter referred to as "Authority," and OKEECHOBEE BEACH WATER ASSOCIATION, INC., a Florida not for profit corporation, hereinafter referred to as "OBWA." W I T N E S S E T H: WHEREAS, on November 10, 1994, the Board of County Commission- ers of Okeechobee County, Florida "County and the City of Okeechobee, Florida "City entered into an Interlocal Agreement creating the Okeechobee Utility Authority "Interlocal Agreement and WHEREAS, the Authority was created for the purpose of acquiring, owning, operating, and maintaining a regional water and wastewater system to ensure an adequate future water supply and wastewater services for the citizens, residents and utility consumers located within all of the designated service areas of the Authority; and WHEREAS, the Authority constitutes a separate legal entity, which has those powers, duties, and responsibilities set forth in the Interlocal Agreement; and WHEREAS, OBWA is currently authorized to operate and maintain a water system within certain portions of the unincorporated area 12/14/94 3:43pm of Okeechobee County, Florida, pursuant to the franchise granted to OBWA by the County under Okeechobee County Ordinance No. 93 -5; and WHEREAS, pursuant to Article X of the Interlocal Agreement, the parties hereto recognize and acknowledge that a Master Transfer Agreement for further implementation of the Authority is intended to be prepared executed prior to Closing, as hereinafter defined; and WHEREAS, the Master Transfer Agreement shall provide that no transfer of assets from the County, City, or OBWA, shall occur prior to Closing, and that the transfer of assets from the County, City and OBWA to the Authority shall occur simultaneously at Closing, which shall occur on or before October 1, 1995; and WHEREAS, the Master Transfer Agreement shall also set forth the terms and conditions of the transfer to the Authority at Closing of all of the assets which comprise the utilities systems now operated by OBWA "OBWA Utility within its designated service areas; and WHEREAS, pursuant to Article XI of the Interlocal Agreement, the County or City may withdraw from the Authority, at any time prior to Closing, under the terms specified thereunder; and WHEREAS, the Authority and OBWA desire to enter into an agreement to provide for the continued operation of OBWA Utility within its designated Service Area until Closing, as specified under Article V of the Interlocal Agreement. 12/14/94 3s43pm 2 NOW, THEREFORE, for and in consideration of the premises and the mutual agreements hereinafter set forth, the Authority and OBWA hereby agree as follows: ARTICLE I CERTAIN DEFINITIONS 1.1. The following terms shall have the following meanings when used herein: Agreement: "Agreement" shall mean this Agreement, together with all the exhibits attached hereto, as amended from time to time. Authority: "Authority" shall mean the Okeechobee Utility Authority, a separate legal entity. Authority Board: "Authority Board" shall mean the governing body of the Authority, acting for and on behalf of the Authority. Authority Service Areas: "Authority Service Areas" shall mean those areas to be served by the Authority as delineated under the Interlocal Agreement. City: "City" shall mean the City of Okeechobee, Florida, a municipal corporation existing under the laws of the State of Florida. City Utilities: "City Utilities" shall mean the Water System and other utilities now operated by the City within its designated Service Areas. Closing: "Closing" shall mean the consummation of the transaction contemplated by the Interlocal Agreement, as herein- 12/14/94 3I43pm 3 after defined, to be effectuated under the Master Transfer Agreement, as more particularly set forth in Article X of said Interlocal Agreement. County: "County" shall mean Okeechobee County, Florida, a political subdivision of the State of Florida. District: "District" shall mean the area within all of the Authority Service Areas, as those areas may be expanded or contracted in accordance with the provisions of the Interlocal Agreement and the laws of the State of Florida. Environmental Permits: "Environmental Permits" shall mean all licenses, permits, and other approvals from any government or governmental agency, whether federal, state or local, necessary for the acquisition, construction or operation of the OBWA Utility. Interlocal Agreement "Interlocal Agreement" shall mean the Interlocal Agreement between the County and the City dated November 10, 1994, recorded in Official Records Book 360, Page 1684, Public Records of Okeechobee County, by which the Authority was created. Master Transfer Agreement: "Master Transfer Agreement" shall mean that -agreement between the County and the City concerning further implementation of the Authority, as more particularly set forth in Article X of the Interlocal Agreement. OBWA: "OBWA" shall mean the Okeechobee Beach Water Associa- tion, Inc., a Florida not for profit corporation organized for the purpose of, and currently engaged in, constructing, maintaining and 12/14/94 3 :54pm 4 operating a Water System for the supplying of water for domestic, conunercial, agricultural, industrial and other purposes to its members, within a specified service area. OBWA Utility: "OBWA Utility" shall mean the Water System now being operated by OBWA within its specified service area. Service Area: "Service Area" shall mean that area served, or which may be served, by OBWA Utility, during the term of this Agreement, as delineated on Exhibit "A," attached hereto and incorporated herein by this reference. Water System: "Water System" shall mean and include any plant, system, facility or property, and additions, extensions and improvements thereto constructed, under construction, or at any future time constructed, or acquired as part thereof, useful or necessary or having the present capacity for future use in connection with the development of sources, treatment or purifica- tion, and distribution of water, and, without limiting the generality of the foregoing, shall include wellfields, dams, reservoirs, storage tanks, mains, lines, valves, pumping stations, laterals and pipes used for the purpose of carrying water to property connected with such system, and shall include all real and personal property and any interest therein, rights, easements and franchises of any nature whatsoever relating to any such system and necessary or convenient for the operation thereof. 12/14/94 4sOSpm 5 ARTICLE II EXHIBITS 2.1. There are attached to this Agreement as Exhibits "A" through "C," certain lists and documents which contain information, representations, and covenants of the Authority or OBWA which are integral and essential parts of the transaction described in this Agreement, and are listed as follows: Exhibit "A Depiction of current OBWA Utility Service Area. Exhibit "B Schedule of OBWA Utility rates, fees or other charges, during the term of this Agreement. Exhibit "C": Budget of the OBWA Utility for the term of this Agreement. ARTICLE III INTERIM OPERATION OF OBWA UTILITY 3.1. OBWA is hereby authorized by the Authority to continue the operation of the OBWA Utility within its respective Service Area, as described and shown on Exhibit "A," until Closing, pursuant to the terms and conditions of this Agreement. ARTICLE IV OPERATION PENDING CLOSING 4.1. Until Closing, OBWA shall continue to operate the OBWA Utility within its designated Service Area under the provisions of Okeechobee County Ordinance No. 93 -5, and Glades County Ordinance No. 93 -4, which are incorporated herein by this reference. 12/14/94 3143pm 6 4.2. OBWA shall properly maintain all assets and facilities of OBWA Utility within the custom and usage of the industry through the date of Closing. 4.3. OBWA shall bear all of the risk of loss for all of the assets and facilities of OBWA Utility until Closing. 4.4. OBWA shall reasonably cooperate with the Authority by providing access to records and facilities, and providing technical assistance in acquainting the Authority with the operation of OBWA Utility pending the date of Closing. 4.5. The Authority Board shall have final authority to resolve any disputes that may arise during the term of this Agreement between the City and OBWA concerning the location of line extensions, and other related matters, pursuant to the provisions of Article V of the Interlocal Agreement. 4.6. OBWA shall undertake to amend all existing Environmental Permits it holds in connection with operation of OBWA Utility in order to reflect the Authority as a co- permit holder. Any new, renewed or amended Environmental Permits shall be sought for and held jointly by the parties. OBWA acknowledges the Authority's legal standing as a real party in interest to participate in all administrative and judicial proceedings in connection with obtaining amendments to existing Environmental Permits and in 12/14/94 3t41pm 7 connection with obtaining new, renewed, or amended Environmental Permits. ARTICLE V RATES, FEES AND CHARGES 5.1. The schedule of rates, fees, and other charges described and shown on Exhibit "B" shall remain in effect for services provided by OBWA within its respective Service Area, as described and shown on Exhibit "A," from the effective date of this Agreement through the date of Closing. 5.2. Any proposed adjustments to OBWA's rates, fees, and other charges for the provision of services by OBWA Utility shall be submitted to the Authority for prior review. The Authority shall have the ability to provide information to OBWA, but the Authority shall not disapprove, modify, or amend OBWA's rates, fees, and other charges, pending Closing. 5.3. After Closing, the Authority Board may revise the schedule of rates, fees, or other charges, from time to time, based upon the criteria set forth in Article VI of the Interlocal Agreement., ARTICLE VI BUDGET AND FUNDING 6.1. The budget for continued operation of OBWA Utility covering the period from the effective date of this Agreement through September 30, 1995, shall be as set forth in Exhibit "C." P 12/14/94 3143pm 8 1 6.2. In the event it becomes necessary for OBWA to amend the above described budget prior to September 30, 1995, OBWA shall provide prior notice to the Authority of any proposed amendments to said budget, for its review and input. 6.3. OBWA shall maintain its respective OBWA Utility operation and maintenance accounts for purposes of paying its obligations and liabilities, through the date of Closing. At all times during the term of this Agreement, the rights of the creditors and obligees of OBWA who are to be paid from the operation and maintenance accounts of OBWA Utility shall be prior and superior to the rights of any other creditors and obligees of OBWA who are to be paid from the fees, rates, and other charges of said OBWA Utility. 6.4. Except to the extent currently authorized as of the date of this Agreement, OBWA shall not pledge any payments', income or revenues derived from the provision of services by OBWA Utility during the term of this Agreement, without prior written approval by the Authority. The Authority shall not unreasonably withhold such approval. ARTICLE VII DEFAULT 7.1. Either party to this Agreement, in the event of or act of default by the other, shall have all remedies available to it under the laws of the State of Florida, including, but not limited to, injunction to prevent default or specific performance to enforce this Agreement, subject to state law. The rights of the parties 12/14/94 3t43pm 9 shall be considered cumulative and shall not be waived now or in the future by the exercise of any rights and remedies provided under the terms of this Agreement and authorized by law. 7.2. In the event there is a breach of this Agreement and it becomes necessary for either party to employ the services of an attorney, either to enforce the Agreement or pursue other remedies, such as litigation or adversarial administrative proceedings, the prevailing party shall be entitled to be paid by the other party its reasonable attorneys' fees and costs incurred in enforcing the Agreement or pursuing other remedies. ARTICLE VIII INDEMNIFICATION 8.1. Except as limited by Chapter 768, Florida Statutes, the parties agree to hold each other harmless for the negligent acts of itself, its officers, agents, and employees, but only to the extent permitted by law. 8.2. If service provided hereunder is discontinued to a customer due to failure of the customer to pay for services provided, the party responsible for discontinuing service shall hold the other party harmless as to any and all claims or suits regarding such action. 8.3. The parties hereto specifically acknowledge that the Authority has not assumed any liability for OBWA's actions in operating the OBWA Utility, and will not assume any such liability until Closing. 12/14/94 3t43pm 10 ARTICLE IX AMENDMENTS TO AGREEMENT 9.1. This Agreement may only be amended by the proper execution of an amendment hereto by the official action of the Board of Directors of OBWA and the Authority Board, during such time as they remain subject to the terms and provisions hereof. ARTICLE X EXECUTE IN COUNTERPARTS 10.1. This Agreement may be executed in counterparts, and each fully executed counterpart shall be deemed an original. ARTICLE XI SEVERABILITY 11.1. Any determination by a court of competent jurisdiction that any provision of this Agreement is illegal, void, or un- enforceable, shall not adversely affect the enforceability of any other provision of this Agreement, unless the provision determined to be illegal, void or unenforceable, is a provision relating to a significant item of consideration for the benefit of a party hereto. ARTICLE XII LAWS GOVERNING INTERPRETATION 12.1. This Agreement shall be controlled and interpreted according to the laws, rules and regulations of the State of Florida. 12/14/94 3t43pm 11 ARTICLE XIII BINDING AGREEMENT AND ASSIGNMENT 13.1. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto, their respective assigns and successors by merger, consolidation, conveyance, or otherwise. ARTICLE XIV ENTIRE AGREEMENT 14.1. This Agreement supersedes any and all previous agreements or representations, either verbal or written, heretofore in effect between the parties, made with respect to the matters herein contained. ARTICLE XV DISCLAIMER OF THIRD PARTY BENEFICIARIES 15.1. This Agreement is solely for the benefit of the formal parties herein, and no right or cause of action shall accrue upon or by reason hereof to or for the benefit of any third party not a formal party hereto. ARTICLE XVI NOTICES 16.1. Any notice required or allowed to be delivered hereunder shall be in writing and shall be deemed to be delivered when either (1) hand delivered to the official hereinafter designated, or (2) when deposited in the United States Mail, postage prepaid, certified mail, return receipt requested, addressed to a party at the address set forth below, or at such other address as the party 12/14/94 3t43pm 12 shall have specified by written notice to the other party delivered in accordance herewith: OBWA: Okeechobee Beach Water Association, Inc. Leland C. Pearce, President 8840 Highway 78 West Okeechobee, Florida 34974 Authority: Okeechobee Utility Authority ARTICLE XVII AFFIRMATION 17.1. OBWA hereby affirms that, at a duly constituted meeting of the Board of Directors of OBWA on the day of 1994, it approved the terms of this Agreement and the execution thereof by OBWA. 17.2. The Authority hereby affirms that, at a duly constituted meeting of its Authority Board on the day of 1994, it approved the terms of this Agreement and the execution thereof by the Authority. ARTICLE XVIII FILING 18.1. Upon execution of this Agreement, and any subsequent amendments thereto, this Agreement and such subsequent amendments shall be filed with the Clerk of the Circuit Court of Okeechobee County, Florida, and Glades County, Florida. 12/14/94 3:43pm 13 ARTICLE XIX EFFECTIVE DATE 19.1. This Agreement shall be deemed effective immediately upon its execution by all parties, and filing pursuant to law. IN WITNESS WHEREOF, the Authority and OBWA have executed this Agreement on the day and year first above written. ATTEST: OKEECHOBEE UTILITY AUTHORITY By By Secretary Chairman APPROVED AS TO FORM AND LEGiikliF4 SUFFICIENCY 474 4 Sh Authority Attorney OKEECHOBEE BEACH WATER ASSOCIATION, INC. By Witness President Witness STATE OF FLORIDA COUNTY OF OKEECHOBEE The foregoing instrument was acknowledged before me this day of 1994, by of OKEECHOBEE BEACH WATER ASSOCIATION, INC., a Florida not for profit corporation, on behalf of the corporation. He /she is personally known to me or has produced as identification. Notary Public, State of Florida Printed Name: Commission No.: My Commission Expires: 12/14/94 3:d3pm 14 JOINDER AND CONSENT THE BOARD OF COUNTY COMMISSIONERS OF OKEECHOBEE COUNTY, FLORIDA, hereby approves, joins in, and consents to this OPERATIONAL AGREEMENT BETWEEN OKEECHOBEE UTILITY AUTHORITY AND OKEECHOBEE BEACH WATER ASSOCIATION, INC., this day of 1994. ATTEST: BOARD OF COUNTY COMMISSIONERS OF OKEECHOBEE COUNTY, FLORIDA l By 4 By Y Clerk r n APPROVED AS TO FORM AN Aa SUFFICIENCY o Q County Attorney c: \mdm \20121dj.oa2 12/14/9. 3i4 pm