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HomeMy WebLinkAbout03151 ORD - 10/03/1951AN ORDINANCE AUTHORIZING AND DIRECTING THE CITY MANAGER FOR AND ON.BEHALF OF THE CITY TO EXECUTE A CONTRACT WITH SUNRAY_OIL_CORPORATION FOR THE SALE AND SUPPLY TO. IT OF UNTREATED WATER FOR A TERM OF FIVE (5) YEARS FOR AND IN CONSIDERATION OF $10 CASH AND_ THE BENEFITS ARISING TO SAID CITY BY REASON OF THE SALE -OF UNTREATED.MTER F1N.SPECIFIED QUANTITIES AT SPECIFIED RATES, PROVIDING FOR CERTAIN FRANCHISE RIGHTS IN THE USE OF PUBLIC LANDS AND.STREETS FOR TRYING OF PIPE LINE, PROVIDING �M CONSTRUCTION, MAINTENANCE.AND_OPERATION OF_A -- PUMPING STATION, PROVIDING FOR RENEGOTIATION OF PRICE OF WATER, PRO- VIDING METHOD OF PAYMENT AND MEASUREMENT OF WATER; PROVIDE -FIM ASSIGNMENT WITH APPROVAL OF CITY.COUN- CIL, AND PROVIDING CERTAIN.OTHER COVENANTS AND AGREE- MENTS AS DEFINED IN THE TERMS AND CONDITIONS OF SAID CONTRACT, A -COPY OF WHICH IS ATTACHED HERETO AND MADE A PART HEREOFS WHEREAS,, The City of Corpus Christi is the owner of a water treating and distributing system; and request has been made of the City of Corpus Christi for the execution of a contract with Sunray Oil Corporation, a Delaware Corporation having a permit to do business in the State of Texas, for an adequate supply of untreated water essential to the operations contemplated in a plant to be constructed in Nueces County, Texas, the operation of which requires a reliable source of supply of untreated water; and WHEREAS, The City of Corpus Christi is desirous of furnishing and sell- ing to said Sunray the untreated water needed by its operations: NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the City Manager be and he is hereby authorized and directed for and on behalf of the City of Corpus Christi to execute a con- tract with Sunra�0il Corporation, for the supplying of untreated water in specified quantities at specified rates as shown by the terms of said contract to run for-a-period of five (5) years, under the terms and conditions of said contract, a copy of which is attached hereto and made a part hereof, reading as follows, to -wit: 3151 y... 111:` 'k. THE STATE 9F TEXAS X COUNTY OF NDECES X WHEREAS, The City of Corpus Christi, Texas, a municipal corporation, is now the owner of a water distribution system originating out of and from the Nueces River and is engaged in supplying water for industrial and domes- tic purposes, said City of Corpus Christi having constructed a dam and reser- voir to impound and regulate the flow of water in said river near Mathis, Texas, and the point on said river from which said water is so taken by said City of Corpus Christi being located at or near Calalien, Texas; and WHEREAS, The said City of Corpus Christi, Texas is desirous of fur- nishing and selling to Sunray Oil Corporation, a Delaware Corporation haven a permit to do business in Texas, untreated water to be used by it, its sue - cessors and assigns- NOW, THEREFORE, This contract and agreement this day made and entered into by and between the City of Corpus Christi, acting by and through its duly authorized officers, hereinafter called "City ", and 'Sunray Oil Corporation, a Delaware corporation having a permit to do business in Texas, acting by and through its duly authorized officers, hereinafter called "Sunray ", If TNES9ETkJ -. IN CONSIDERATION OF The premises, the sum of Ten Dollars($10) cash in hand paid by Sunray to City, the receipt of which is hereby acknowledged, the benefits arising to said City by reason of the sale of untreated water to Sunray, its successors and assigns,'and the matuai covenants and agreements of the parties herein contained, it is AGREED AS FOLLOWS-. 1 TYPE OF WATER AND PRICE. City agrees sell, subject to the Condi- tions hereinafter set forth, such untreated waver, not to exceed a maximum daily consumption of two million, five hundred thousand (29,500,000) gallons, as shall be demanded by Sunray for ase by 'Sunray In the operation of its plant, plants or any additions thereto, at the rate of four cents (4�) per one thousand (1,000) gallons for the first sixty million (.60,000,000) gallons used per month and at the rate of two, cents (2�.'. per one thousand (1,000) gallons for all untreated water over and above sixty million (60;000,000) gallons Ased per month and delivered by City to Sunray under and during the period covered by this contract. The water deli.rmd t- remader shall be untreated'wNter taken directly from the Nueces River end delivered to Sunray at the place hereinafter designated. 2 REDETERMINATION OF PRICE° It is agreed, however, that the rates specified above of 2¢ per 1,000 gallons for all untreated water over and above 60,0009000 gallons used per month shall apply only so long as the City has existing contracts under which the sale of untreated water is made at the price of 2� per 1,000 gallons, In the event that the cost of untreated water in the said existing City contract or contracts is rede- termined and the price of said untreated water increased, then it is agreed that the 2� per 1,000 gallons priced to 'Sunray for untreated water used in excess of 60,000,000 gallons per month shall he increased accordingly and in the same amount. City and Sunray agree that at the end of each two (2) year period of this contract, except as hereinafter provided, the prices at which City shall sell untreated water to Sunray shall be redetermined, said redeter- mined prices to be based upon the cost of untreated water to the City at 4 ' that time or the projected cost of untreated water to City in the immediate future. It is agreed and understood that said redetermined price shall be without profit to City and without subsidy of 'Sunray, but in no case shall Sunray be compelled to pay more than consumers using comp,,r-1le quaeatities under similar contracts. And the City and Sunray agree that should the OakWri;.?e Dam, or any similar source capable of supplying the amount )''' Nlaf >T . •h tz.'. -<r d i o connection with the Oakville Dam, be establi °;s.eu, tb n "he ur &,Aak' whA;.h Sunray will pay «City for the before - mentioned rater will at that time be redetermined on the basis of the cost of tt;r- wateE to ; ity, and without profit to City or subsidy of '3 TERM OF CONTRACT, The obligations of the parties hereto shall commence and be binding from and after April 1, 1952, and continue up to and including April 1, 1957, =2= eseca� 4 GE_OF DELIMY. The place of delivery of said untreated water is fixed as follows, to —wit: In Nueces County, Texas, at a point on the right baj* of the Nueces River down stream from the present point of intake of the City of Corpus Christi at a suitable site to he selected by the General Superintendent of Public Utilities of the City of Corpus Christi, Texas,. for the purpose of withdrawing the untreated water from the Nueces River at said poibt of delivery to 'Sunray, which is hereby granted the, permission to erect on said land of the City, its pumping station and such other facilities as are necessary to withdraw water directly from the river at the intake and into pipe lines to be installed by Sunray on said tract of land, including right —of —way for laying pipe line; provided, *wever, not more than -a total of one acre shall be occupied by the facilities and Installations of Sunray. All expenses of the construction and maintenance of said pumping station shall he borne by Sunray, but City agrees to operate the pumps and equipment located in said pumping station for the purpose of withdrawing untreated water from said river into the line of 'Sunray, and Sunray shall pay City monthly, at the time for payment of the untreated water sold hereunder, the reasonable cost and expense of the operation of such pumps and pumping facilities, as is determined by City; and in case such reasonable cost and expense as determined by City is not acceptable to Sunray then Sunray shall operate the said pumps and equipment. City shall not-be responsible for failure of pumps and equipment for any cause, nor liable for such failure, nor for any damages which may result from such failure, either to such pumps and equipment, or to plant operations because of failure of water ti, bo� transported, 5 ' LAYING OF LINE AND INSTALLATION OF DDUIPM5NTs Sunray contemplates the laying of a pipe fine from the point of delivery to its plant at a point west of the City of Corpus Christi in Nueces County, Texas, for the purpose of transporting the untreated water sold hereunder, and the City hereby grants and conveys to Sunray an easement extending for the term of this contract upon, over, through and across any streets or other land owned by City which adjoins the point of delivery, for the purpose of laying, con- structing, opOxa.ilog and maintaining any pipe line or lines desired to be 5'M 'aid by Sunray for the purpose of tv.— aie,orting untreated water sold hereunder; provided, however, that the location of such line across streets or land owned by City must first be approved by City. The location of said pipe line along or across the streets and othem lamas of City are subject to relocation upon order of City. The entire cost of construction, relocation, operation and maintenance of said pipe line or lines shall be borne by 'Sunray at its sole cost and expense. G TLEa Title to the untreated water deliverable hereunder by City shall be deemed to pass and shall pass to Sunray at the point of delivery as set out hereinabove. In connection herewith, it is agreed by City and Sunray that each shall indemnify and forever hold hawless the other against each and every claim, demand or cause of action which may arise while the said untreated water is in its possession, MEASUREMENT OF WATER, Measurement of the untreated water deliverable hereunder shall be measured by a suitable water meter or meters of standard make and acceptable -to City. Sunray shall furnish said meter and install same, and City shall keep same in repair. Checks as to the accuracy of the meter or meters shall be made semi — annually, and City shall notify 'Sunray in triting ten (10) days in advance of all semiannual checks and tests in order that Sunray may have a representative present as a witness. Semi — annual tests as to the accuracy of the meter or meters shall he at the expense of the City. If either City or Sunray at anytime shall nf.ify the other that it desires a special test of any meter, the parties shall cooperate to secure an immediate determination of the accuracy the,:.sjf, anal shall make joint observations of any adjustments. If upon each go"'Iel tests any such meter is found to be less than 2% high or low, the cost of such test shall be paid by the party request- ing it; otherwise by the other party. Each party shall give to the other written notice of the time of any and all such tests in advance of the hold- ing of same within a reasonable length of time in order that the other party may have a representative present. If upon any test the meter tested is found to be not more than 2% high or low, previous readings shall be consider- ed correct in computing the volume of untreated water delivered by City to —4— Sunray, but such meter shall be at once adjusted to record as accurately as possible. If on any test the meter tested shall be found to be inaccurate by an amount exceeding 2% then any previous readings of such meter shall.be corrected for any period of inaccurate measurement tbereby which is definite- ly known or agreed upon, but no such correction shall extend back over a period beginning more than fifteen (15) days prior to the time when such in- accuracy was first made known by either party to the other. If for any reason the meter or meters are out of service so that the volume of untreat- ed water delivered hereunder cannot be ascertained or computed from meter readings thereof, the untreated water delivered during the period such meter or meters are out of service shall be estimated and agreed upon by the parties hereto upon the basis of the best data available, 8 P St Payments for any and all untreated water sold by City to Sunray shall be paid monthly at the office of the Water Department of the City of Corpus Christi, Texas, and all bills therefor shall be paid on or before the 20th day of the succeeding month after same accrued. Statements shall be mailed to Sunray at Post Office Box 2039, Tulsa, Oklahoma, on or before the 10th day of each month showing the volume of water delivered and the sum due City therefor by Sunray hereunder during the preceding month. Upon failure to pay any bill due hereunder before delinquency, City may give notice of such delinquency, and if all bills.due,and unpaid are not paid in full within fifteen (15) days after the mailing of such notice, then City shall be authorized to discontinue further water service until all bills due or past due have been paid in full, 9 IM SS AND SGRESSS The right of ingress and egress is hereby granted by City to Sunray, or its agents, employees or representatives, across any promises or lands owned by City at any points from which such untreated slater is delivered under this contract for the purpose of laying its mains and pipe lines, and for the installation of such other equipment as may be necessary to Sunray to obtain dolivery.of such untreated water from City hereunder. 10 FIXED MINIMUM OBLIGATION= This contract imposes no obligation upon Sunray to purchase any minimum amount of untreated water in any calendar a + month throughout the period of this contract, but Sunray shall pay to City during the life of "this contract the minimum amount of Fifty Dollars ($50) per month, regardless of whether any untreated water is used or not, same to he payable on or before the 20th day of each month for the preceding calendar month; provided, how6ever, if the volume of untreated water consum- ed by Sunray during any calendar month amounts to more than Fifty Dollars ($50) then such fixed monthly sum of Fifty Dollars ($50) shall be credited upon the amount due,' However, if the volume of such untreated water consumed by `sunray during any calendar month amounts to less than the fixed sum of Fifty Dollars ($50), then, in addition to the payment of such untreated water, Sunray shall pay the dif- ference between amount due City for the said untreated water actually consumed and the sum of Fifty Dollars ($50), such sums shall be payable at the time and place hereinbefore provided, 11 FORCE MAJEDRE: If City should he prevented, wholly or in part; from fulfilling its obligations under this contract by reason of an act of God, un- avbidable accident, acts of enemy, strikes, fires, floods, governmental rest- raint or regulation, including Court Orders, or any other case of force majeure then the obligation of City to deliver untreated water to Sunray, as herein provided shall be temporarily suspended during the continuance of such force majeure. No damage shall be recoverable by Sunray from City by reason of the temporary suspension of delivery of such untreated water due to any of the causes above mentioned. If the City's obligation shall be affected by any of such causes City shall promptly notify Sunray in writing, giving full particulars of such force majeure as soon as possible after occurrence of the cause or causes relied upon, 12 PRIORITIES: This contract is entered into and the sale of untreated water hereunder is made subject to at all times the prior rights of domestic and industrial consumers within the City Limits of the City of Corpus Christi, Texas, to the supply of water in the Nueces River, and in the event at any time the supply of water in the Nueces River shall so diminish as to jeopardize the then supply of water to such consumers, then and in such event, this contract shall become suspended during the period of time when such supply of water in —6— said river is so diminished, but immediately upon the supply of water in,said river becoming again safficieut for the Use of domestic and industrial consum- ers within the City Limits of the City of Corpus Christi, this contract shall become again.effective immediately to the extent of the excess of such suffi- ciency. 13 ALTERATIONS+M RED It is expressly recognized by Sunray that City may be compelled to make necessary 41terations, repairs, or installations' of new or additional pumps, motors, valves, or equipment from time to time dur- ing the life of this contract, and any syspension of delivery to Sunray due to such operations shall not be cause for claim for damages* #n the part of Sunray, provided all reasonable effort by City is used to provide Sunray plant with untreated water, 14 ASSIGNABILITY: 'Except fob assignments to any person operating Sunray °s Nueces County Plant at its location approximately six (6) miles west of the City of Corpus Christi, the rights of Sunray under this contract may he assigned only with the written consent and approval of the governing body of City, but this contract shall be binding upon the parties hereto as well as their successors and assigns. 15 CANCELLATION: This contract may be cancelled at any time with the mutual consent of Sunray and the governing body of City, IN WITNESS.WH3 REOF, The parties have hereto caused these presents na be duly executed this the day gf,October, A.D. 1951, ATTESTEb: THE CITY OF CORPUS CHRISTI, TEXAS City Secretary APPROVED AS TO LEGAL FORM: City Attorney ATTESTED: -7- By W. B. Collier, City Manager SUNRAY OIL CORPORATION (a Delaware Corporation, having a Permit to do business in Texas) Section 2. — In accordance with the City Charter of the City of Corpus Christi, Texas. the foregoing ordinance was read the first time and passed to the second reading on the 16th day of October. A.D. 1951, by the following vote: Leslie Wasserman Ave Jack DeForrest Ave Barney Cott Ave Sydney E. Herndon Ave George L. Lowman Ave The foregoing ordinance was read the second time and passed to the third reading, on the`I day of , 1951, by the following vote: Leslie Wasserman Jack DeForrest Barney Cott Sydney E. Herndon 4OF George L. Lowman T The foregoing ordinance was read the third time and passed finally, passed and approved on the 'day of lsg7 1951. by the following vote: Leslie Wasserman Jack DeForrest .Barney Cott Sydney E. Herndon George L. Lowman APPROVED, This the Z day of . A.D. 1951. MAYOR CITY OF CORPUS CHRISTI City Secretary APPROVED AS TO LEGAL FORM: City Attorney '3