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Appendix F:
Proof of Water Supply
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2001-1450
Green/CroissantSandAndGravelMineAndReadyMixConcretePlant 20023
Loveland Ready Mix Concrete,Inc. 19 March 2001
6 _ - LEASE OF FULLY CONSUMABLE WATER
THIS LEASE is made and entered into this /2 day of ,�
1998, by and between the City of Loveland, Colorado, a Colorado
home rule municipality ("City") , whose address is 500 East Third
Street, Loveland, Colorado 80537, and Loveland Ready Mix, a
Colorado corporation ("Lessee"), whose address is 1811 West 12"
Street, Loveland, Colorado 80537 .
WHEREAS, the City owns certain water which, pursuant to the
water laws of the state of Colorado, may be used, re-used and
successively used to extinction (the "Fully Consumable Water") ;
and
WHEREAS, the Lessee wishes to lease from the City the right
to use a portion of the City' s Fully Consumable Water; and
WHEREAS, the City is willing to lease to Lessee a portion of
its Fully Consumable Water pursuant to certain terms and
conditions as set forth in this Lease,
NOW, THEREFORE, in consideration of the mutual promises and
covenants contained herein and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
parties agree as follows:
1 . The City hereby leases to the Lessee the right to
receive two hundred acre feet of the City' s Fully Consumable
Water, as defined in paragraph 4 of this Lease, on an annual
basis . This Lease shall be for a term of twenty-five (25) years,
ending on Ljzc.3I, 2DZ2, However, Lessee shall have the option to
renew this Lease for successive terms of twenty-five years, which
option shall terminate only if Lessee is in default of its
payment obligations under paragraphs 6 or 7 of this Lease or if
Lessee elects not to exercise its option to renew by giving
notice to the City pursuant to paragraph 13 of this Lease not .
later than three (3) months prior to the end of any twenty-five
(25) year term. In the event Lessee is not in default of its
payment obligations and elects to renew the Lease for any
successive twenty-five year period, Lessee shall not be required
to pay any additional amounts under this Lease for the right to
receive its allotted amount of the City' s Fully Consumable Water
as set forth above.
2 . The two hundred acre feet of Fully Consumable Water
which the Lessee shall be entitled to receive annually is
hereinafter referred to as the "Leased Water. " The parties
EXHIBIT
I Olt.
recognize that, simultaneously with the execution of this Lease,
the City has leased the right to receive one hundred acre feet of
its Fully Consumable Water to Coulson Excavating Company and that
the City may, in the future, lease additional portions of its
Fully Consumable Water to persons other than Lessee. The
Lessee' s right to receive two hundred acre feet of the City' s
Fully Consumable Water pursuant to this Lease shall be equal to
the right of Coulson Excavating Company to receive its one
hundred acre feet of Fully Consumable Water such that in the
event less than three hundred acre feet of Fully Consumable Water
is available in any year, Lessee and Coulson Excavating Company
shall each be entitled to receive a proportionate share of the
available Fully Consumable Water. The right of Lessee to receive
two hundred acre feet of the City's Fully Consumable Water under
this Lease shall be deemed to be a first right relative to all
others, such that in the event the available Fully Consumable .
Water in any year is in excess of three hundred acre feet but is
not sufficient to meet the needs of all persons holding leases of
Fully Consumable Water, Lessee shall receive up to its entire two
hundred acre feet allotment from the first three hundred acre
feet of Fully Consumable Water available.
3 . In consideration of the right to receive the Leased
Water, Lessee shall, upon execution of this Lease; pay City the
sum of
Dollars in certified funds . By entering into this Lease with the
Lessee, the City is and shall be under no obligation to file an
application for a change of water rights or for a plan of
augmentation concerning the use of the Leased Water by the
Lessee.
The City shall not be responsible for the implementation of
any temporary substitute supply plan or augmentation plan
concerning the use of the Leased Water. The cost and expense of
any such proceeding shall be that of the Lessee. The City agrees
to furnish sufficient Leased Water so that, subject to the
provisions of this Agreement, the net usable first use or
subsequent use water obtained by the Lessee shall be 200 acre
feet . The City shall not be obligated to deliver Leased Water to
Lessee unless Lessee shall have first provided written notice to
the City that Leased Water will be required in a given year by
April 1 of the preceding year.
The City shall deliver the Leased Water under this Lease in
a total annual quantity as specified by the Lessee and at
specific monthly delivery times and in specific monthly
quantities according to the evaporation table, attached hereto as
Exhibit A, or as otherwise agreed by the City and the Lessee in
writing. In no event shall the monthly deliveries exceed the
monthly amounts shown on Exhibit A unless hereafter agreed in
writing by the City and the Lessee.
The Lessee shall not hate the right to carryover from month
to month or from year to year any Leased Water which was
deliverable, but not requested for delivery, in a prior time
period. If the maximum allowable delivery under this Lease is
not requested by Lessee in any month, the right of Lessee to call
for the delivery of such water shall lapse and all such water
shall remain the sole property of the City.
4 . In'supplying the Leased Water pursuant to this Lease,
the City may use any water, including, but not limited to the
following sources of water which may be used to extinction (the
"Fully Consumable Water") :
a. Native water from the Big Thompson River basin
which, when stored within the City's reservoir
system, may be totally consumed pursuant to the
terms and conditions of the Decree for Change of
Water Rights for the City of Loveland, dated June
18, 1985, Case No. 82-CW-202A, Water Court
Division One, State of Colorado or subsequent
actions; and
•
b. Water under an Allotment Contract with the
Municipal Sub-District of the Northern Colorado
Water Conservancy District (the "Northern
District") , commonly known as Windy Gap Water; and
c. Any water subsequently acquired by the City and
determined by Water Court Decree to be totally
consumable.
5 . The City shall have the right to deliver the Leased
Water to Lessee from any of the sources of Fully Consumable
Water, at the City' s sole discretion, and shall have the right to
determine if any or all of the Leased Water shall be first use
water or subsequent use water. The City shall never be required
to deliver first use water, even if it is the only Fully
Consumable Water available to meet the terms of this Lease. In
the event the only water available to the City to meet the terms
of this Lease is first use Windy Gap Water and the City is
willing to deliver such first use water, the City shall notify
the Lessee prior to delivering such water and the Lessee shall
have the option to accept the first use Windy Gap Water and pay
the costs of delivering such water pursuant to the terms of
paragraph 6 of this Lease. In the event the Lessee refuses to
accept the delivery of the first use Windy Gap Water, the City
shall be deemed to have met its obligations under this Lease,
until such time as a source of Fully Consumable Water, other than
first use Windy Gap Water, becomes available. In the event the
City is reasonably able to but fails to exercise its rights under
Case No. 82CW202A sufficient to meet the demands under this
Agreement, (unless the exercise of such rights would impair the
City' s ability to meet the normal domestic needs of the City) ,
and the only water available to the City to meet the terms of
this Lease is first use Windy Gap Water, the Lessee shall not be
required to pay the delivery charges provided in paragraphs 5 or
6 for the delivery of such first use Windy Gap Water.
6 . In the event the Lessee agrees to accept the delivery
of first use water from the City' s allotment of Windy Gap Water,
Lessee shall pay to the City, the total costs of all pumping and
conveyance charges, plus any assessments and fees for
administrative, operating, maintenance and any other fees or
costs charged by the Sub-District for delivery of the water to
the City. The Lessee shall pay the City the total estimated costs
in advance, and the City shall not be obligated to deliver any
such water until it has received the full estimated payment. In
the event the estimated costs paid by the Lessee are less than
the actual costs incurred by the City in delivery of Windy Gap
Water to the Lessee, Lessee shall pay the City any additional
amounts owed within thirty days of receipt of an invoice from the
City setting forth the amount owed. In the event the Lessee
shall fail to pay such additional amounts upon receipt of an
invoice from the City, the City shall have the right, in addition
to any other legal or equitable remedies it may have, to refuse
to deliver any Leased Water until such time as all additional
amounts owed pursuant to this paragraph have been paid in full .
In the event the estimated costs paid by the Lessee are greater
than the actual costs incurred by the City in delivery of Windy
Gap Water to the Lessee, the City shall refund any excess within
thirty days of the City' s receipt of an invoice from the Northern
District .
7 . Lessee shall pay the City' s reasonable costs incurred
in administering the terms of this Lease. For the first five
years of this Lease, the administrative costs shall be One
Thousand and 00/100 Dollars ($1, 000 . 00) per year, payable in
advance . The City shall recalculate the reasonable administrative
costs every five years and inform the Lessee in writing of the
change at least thirty days prior to the start of the new five
.— year period. In the event the Lessee does not require the
delivery of any of the Leased Water in a given 'year, there shall
be no administrative costs charged. The City shall invoice the
Lessee for the annual administrative costs in January of each
year and Lessee shall pay said costs within thirty days of the
invoice date. In the event the Lessee shall fail to pay its
accrued administrative costs in any year, the City shall have the
right, in addition to any other legal or equitable remedies it
may have, to refuse to deliver the Leased Water until such time
as all accrued administrative fees have been paid in full .
8 . At the option of the City, delivery of the Leased Water
shall be made at the City' s Waste Water Treatment Plant, 700
South Boise Avenue, Loveland, CO, or at such other downstream
location or locations above the Lessee' s original point of need
as agreed by and between the Lessee and City in writing. Lessee
shall not unreasonably withhold its approval of any request by
the City to move the point of delivery.
9. Subject to the provisions of paragraph 5, the City
shall only be obligated to deliver the Leased Water to the Lessee
if water meeting the requirements of this Lease is reasonably
available to the City. In the event of a drought or other
conditions, restrictions or emergency situations beyond the
control of the City which limit the City's ability to receive or
deliver all or a portion of the Leased Water to the Lessee, the '
City shall be relieved of its obligations to deliver such water
under the terms of this Lease until such time as conditions '
permit the City' s receipt and delivery of the Leased Water.
10 . The Lessee shall take the Leased Water AS IS and the
City makes no express or implied warranties of any kind or
nature, including the warranties of merchantability or fitness
for a particular purpose, concerning the water quality of the
Leased Water.
11 . In the event the Lessee wishes to assign, encumber or
exchange its rights to receive all or any portion of the Leased
Water not already used to satisfy a temporary substitute supply
plan or permanent augmentation decree to a third party, the City
shall have the first right of refusal to reacquire said rights .
In such event, Lessee shall notify the City in writing and shall
provide the City with a copy of the signed agreement between the
Lessee and the third party. The City shall have the right to
reacquire the water rights within ninety days from receipt of the
notice, by informing Lessee of its intent to exercise its first
right of refusal and by paying Lessee the contract price as set
forth in the agreement between the Lessee and the third party. If
the City does not exercise its right of first refusal, the Lessee
may assign or transfer its rights to a third party, and the third
party shall be bound by all terms and conditions of this Lease,
including the obligation to allow the City the first right of
refusal on any transfer or assignment of the Leased Water, it
being the intent of this Lease that the City' s right of first
refusal shall apply to each and every transfer of the Leased
Water which may arise at any time during the existence of this or
any subsequent Lease. The right of first refusal set forth in
this paragraph shall not apply in the event the Lessee wishes to
assign, encumber or exchange its rights to receive all or any
portion of the Leased Water to a third party pursuant to an
exchange which is a transfer, sale or assignment of all or
substantially all of Lessee' s assets to said third party.
12 . After the City has increased the storage capacity of
Green Ridge Glade Reservoir to at least five thousand (5, 000)
acre feet, and upon sufficient advance written notice so as to
permit the City to place appropriate orders for replacement
water, the Lessee may temporarily sub-lease the Leased Water or
portions thereof to third parties without activating the City' s
right of first refusal as set forth in paragraph 11, so long as
the length of the sub-lease term and the amounts and times of
discharge required by the Sub-lessee are acceptable to the City.
Any such lease arrangement shall first_be provided to the City
for its review and approval, which approval shall not be
unreasonably withheld.
13 . All notices shall be in writing and shall be deemed
given if personally delivered or mailed, certified mail, return
receipt requested, to the following addresses :
If to City, to:
City of Loveland Water & Power Department
Attn: Ralph Mullinix, Director
200 North Wilson Avenue
Loveland, Colorado 80537
with a copy to:
City of Loveland
Attn: City Attorney
500 East Third Street
Loveland, Colorado 80537
If to Lessee, to:
Loveland Ready Mix.
1811 West 12th Street
Loveland, Colorado 80537 .
14 . No alteration or other modification of this Lease shall
be effective unless such modification shall be in writing and
signed by the parties.
15 . In the event any portion of this Lease should become
invalid, the remainder of the Lease shall remain in full force
and effect .
16. This Lease shall be governed by and construed in
accordance with the laws of the State of Colorado. This Lease
shall inure to the benefit of, and be binding upon, the
successors in interest of the respective parties.
IN WITNESS WHEREOF, the parties have executed this Lease on
the day and year first above written.
CITY OF LOVELAND
OF 1.OVEt .--riteknGE)911.1a,--ct
(S AisL • Mayor
ATTE
•,•COL�•' .04
City Cler —'
(APPROVED AS TO FORM:
Cv A torneeyy', 1
LESSEE
LOVELAND READY MIX
Its : President
ATTEST
:AC", r _
• Secret
•
EXHIBIT A TO LEASE OF FULLY CONSUMABLE WATER
�-. BETWEEN
THE CITY OF LOVELAND AND LOVELAND READY MIX
EVAPORATION BY MONTHS
MONTH PERCENT EVAPORATION
January 3 . 0%
February 3 .5
March 5 . 5
April 9 .0
May 12 .0
June 14 . 5
July 15 . 0
August 13 . 5
September 10 . 0
October 7 .0
November 4 . 0
December 3 . 0
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