HomeMy WebLinkAbout021485 RES - 09/22/1992}
A RESOLUTION
AUTHORIZING THE CITY MANAGER TO EXECUTE AN
AGREEMENT FOR AN OPTION TO PURCHASE UP TO
35,000 ACRE-FEET OF WATER RIGHTS FROM
GARWOOD IRRIGATION COMPANY.
WHEREAS, present water supplies are insufficient to meet the future needs
of Corpus Christi and surrounding communities; and
WHEREAS, the health, welfare, and economic prosperity of our citizens
depends upon acquiring adequate water supplies; and
WHEREAS, acquisition of long-term water supplies is a lengthy process
requiring responsible and prudent planning and action by our citizens and elected officials;
and
WHEREAS, the City of Corpus Christi has the opportunity to secure options
on substantial additional water supplies and to participate in studies providing a sound basis
for future decisions.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF CORPUS CHRISTI, TEXAS:
The City Manager is hereby authorized to execute an agreement for an option
to purchase up to 35,000 acre-feet of water rights from Garwood Irrigation Company, as set
forth in the attached Exhibit A, incorporated herein.
A F1EST:
City Secretary
MAYOR
THE CI*Y�F CORPUS CHRISTI
APPROVED: II DAY OF ,Sir r , 19 las
James R. Bray, Jr., City Attorney
By • R.
City Attorney
ORDS: 91182
021485
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Corpus Christi, Texas
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The above resolution was passed by the following vote:
Mary Rhodes
Cezar Galindo
Leo Guerrero
Betty Jean Longoria
Edward A. Martin
Joe McComb
Dr. David McNichols
Clif Moss
Mary Pat Slavik
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021485
Ex4: f,{- 4 -
AGREEMENT BETWEEN THE
CITY OF CORPUS CHRISTI AND
GARWOOD IRRIGATION COMPANY
This Agreement is entered into as of the 22nd day of
September, 1992, by and between the City of Corpus Christi, Texas
(the "City"), and Garwood Irrigation Company ("Garwood").
The City is a home rule city, organized and existing pursuant
to the Constitution and laws of the State of Texas. Garwood is a
Texas corporation.
The city has concluded that substantial additional supplies
of water are needed to satisfy projected demands for water for
municipal and industrial purposes within the City and its service
area. The City is seeking to identify potential additional
supplies, secure options to acquire those supplies, and then,
during the option period, study the feasibility of acquisition and
development of those supplies.
In pursuit of its goals, the City has recently acquired an
option agreement originally entered into by and between the Port
of Corpus Christi Authority and the Lavaca-Navidad River Authority
("LNRA") to purchase water from Lake Texana supplied by LNRA under
Certificate of Adjudication No. 16-2095, as amended. The City also
desires to investigate the potential for obtaining additional
supplies of water from the Colorado River, either as an independent
source of supply for the City, or as a source of supply to
supplement or increase the amount of water that can be provided
from Lake Texana. In furtherance of those desires, the City
contacted Garwood to determine whether and to what extent Garwood
may be able to assist.
Garwood holds rights to use the waters of the Colorado River
under Certificate of Adjudication No. 14-5434 ("Garwood's Right"),
under which Garwood has the right to divert and use 168,000 acre-
feet of water per year of the run -of -river flow of the Colorado
River at a maximum diversion rate of 750 cubic feet per second for
the irrigation of 32,000 acres of land within a much larger service
area, with a priority date of November 1, 1900. Garwood's Right
has the earliest priority date of all significant water rights in
the Colorado River Basin. A substantial portion of Garwood's
service area lies outside the Colorado River Basin.
Garwood's system as it presently exists has the capacity, and
it has been used historically, to divert and use in excess of
130,000 acre-feet of water per year for irrigation purposes. For
various reasons, Garwood has not yet fully developed its pumping
facilities and canal system to facilitate the diversion and use of
168,000 acre-feet of water per year, as authorized under Garwood's
Right. Most importantly, a long-standing dispute with the Lower
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Colorado River Authority ("LCRA") placed the nature and extent of
Garwood's independent water rights under a cloud for many years,
effectively preventing expansion. That cloud has recently been
removed by the conclusion of the adjudication and the recent
issuance on June 28, 1989 by the Texas Water Commission (the
"Commission") of Garwood's Certificate of Adjudication No. 14-5434,
and by Garwood and LCRA entering into an agreement dated as of
December 10, 1987 (the "LCRA Agreement"). In the LCRA Agreement,
LCRA, among other things, recognizes Garwood's independent water
right and agrees to firm up that right, on an interruptible basis,
with stored water from Lakes Travis and Buchanan. LCRA further
agrees not to charge Garwood for any stored water that may be
needed to firm up the supply of water available under Garwood's
Right, for so long as Garwood maintains the low water dam that is
authorized under Garwood's Right. The LCRA Agreement is not a part
of this Agreement.
Accordingly, Garwood is now free to pursue full development
of its pumping facilities and canal system for irrigation purposes.
Although the market for rice is not nearly as favorable today as
it was years ago, when Garwood wanted to expand but was prevented
from doing so, Garwood has nevertheless received several recent
inquiries regarding expansion to supply water for rice irrigation.
Additionally, increased use of water for other crops may also be
feasible today.
Before Garwood pursues full development of its pumping
facilities, canal system and irrigation alternatives, the City
desires to evaluate the use of a portion of Garwood's Right for
municipal and industrial purposes. The City desires to secure by
option the price and terms for purchase by the City of a portion
of Garwood's Right, and to evaluate during the option period the
feasibility of utilizing such right to supply additional water to
the Corpus Christi area for municipal and industrial purposes.
Garwood believes that the use of such water for such purposes would
be in the public interest, that the sale of a relatively small
portion of Garwood's Right at this time would not have any adverse
impact on the farmers on Garwood's system, and that the sale of
such a portion of Garwood's Right would in fact provide substantial
benefits to Garwood's farmers. Accordingly, Garwood is willing to
grant an option to the City to purchase such a portion of Garwood's
Right and, during the option period, not commit in excess of the
remaining portion of its right on a long-term basis for the
irrigation of rice or other crops.
NOW, THEREFORE, in consideration of the mutual benefits and
covenants contained herein, the City and Garwood hereby agree as
follows:
1. Grant of Option. Garwood hereby grants to the City an
option (the "Option") to purchase up to a 35,000 acre -foot -per -year
portion of Garwood's 168,000 acre -foot -per -year right. The City
may purchase the entire 35,000 acre -foot -per -year portion or any
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portion thereof; provided, however, that if the City purchases any
portion of Garwood's Right, then the amount purchased shall- be at
least a 20,000 acre -foot -per -year portion. The priority of the
portion purchased by the City ("Corpus Christi's Right") shall be
subordinate in time priority and all other respects to the portion
retained by Garwood ("Garwood's Remaining Right"). The maximum
authorized diversion rate under Garwood's Right (750 cfs) shall be
divided proportionately (Garwood's Remaining Right + 168,000 for
Garwood, and Corpus Christi's Right + 168,000 for the City).
2. Purchase Price. The one-time price to be paid by the
City to Garwood for the purchase of Corpus Christi's Right (the
"Purchase Price") shall be the product of $400.00 per acre-foot
times the number of acre-feet specified by the City, in its written
notice pursuant to Paragraph 5 or 6, below, as comprising the
Corpus Christi Right.
3 Term of Option. The Option and this Agreement shall
terminate without notice on March 1, 1994, unless the City before
that date gives Garwood written notice to submit an application to
amend Corpus Christi's right pursuant to Paragraph 6, below.
4. Option Payments. The City shall pay Garwood $20,000 upon
execution of this Agreement, and the Monthly Payment (hereinafter
defined) each month thereafter, each Monthly Payment being due and
payable on the first day of each month beginning on October 1,
1992, with the final payment due on the earlier of the following
dates: (1) the first day of the month during which Garwood
receives payment of the Amount Due (hereinafter defined) as
provided by Paragraph 5, below; or (2) the first day of the month
during which the Option and this Agreement are terminated. The
City shall not be relieved of its obligation to make any payments
under this Paragraph by reason of it giving to Garwood written
notice to submit an application to amend Corpus Christi's Right
pursuant to Paragraph 6, below, or by it conditionally exercising
the Option pursuant to Paragraph 7, below, or by the occurrence of
the Final Commission Date as defined in Paragraph 7, below. The
"Monthly Payment" shall be $10,000 for each payment due and payable
on or prior to the Final Commission Date as defined in Paragraph
7, below, and $5,000 for each payment due and payable thereafter.
5. Exercise of option. At any time prior to termination of
the Option and this Agreement, the City may exercise the Option by
giving Garwood written notice of such exercise. The City shall pay
Garwood the Amount Due within ninety (90) days after the date it
so exercises the Option, or within ninety (90) days after the date
it is deemed to exercise the Option pursuant to Paragraph 7, below.
If the City has not previously given Garwood written notice to
submit an application to amend Corpus Christi's Right pursuant to
Paragraph 6, below, then the City, in its written notice of
exercise of the Option, shall specify the number of acre-feet per
year that comprises Corpus Christi's Right. The Amount Due at any
time shall be the sum of the Purchase Price, plus all accrued
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interest to that time on the Purchase Price pursuant to Paragraph
7, below, less all amounts paid to Garwood under Paragraph 4,
above, less all amounts paid to Garwood as Reimbursable Application
Costs under Paragraph 11, below.
6. Notice to Submit Application. At any time prior to
termination of the Option and this Agreement, but in no event later
than February 28, 1994, the City may give Garwood written notice
to submit the application to amend Corpus Christi's right as
described in Paragraph 11, below (the "Application"). In that
notice, the City shall specify the number of acre-feet per year
comprising Corpus Christi's Right. Upon receipt of such notice,
or upon receipt of the City's written notice of exercise of the
Option pursuant to Paragraph 5, above, whichever first occurs,
Garwood shall divide Garwood's Right into two separate and distinct
portions: one being Corpus Christi's Right, and the other being
Garwood's Remaining Right. From and after the date of such
division, Corpus Christi's Right shall be subordinate in time
priority and all other respects to Garwood's Remaining Right.
If the City gives Garwood the written notice specified above
on or before February 28, 1994, then it shall also give to Garwood
together with such notice evidence satisfactory to Garwood (the
"Required Evidence") that the City has at that time the legal
authority and financial ability to perform all obligations that it
will or may thereafter incur under this Agreement including,
without limitation, all obligations that the City will or may incur
by its failure to give Garwood written notice of termination under
paragraph 8, below, before the Date of Conditional Exercise
(hereinafter defined) for any Order (hereinafter defined).
Garwood's satisfaction with the evidence submitted by the City
shall not be unreasonably withheld.
7. Conditional Exercise of Option. If the City does not
give Garwood written notice of termination under Paragraph 8,
below, before the Date of Conditional Exercise (hereinafter
defined) for any Order (hereinafter defined), then, on that Date
of Conditional Exercise the City shall automatically be deemed to
have determined that Order to be acceptable to the City ("Accept-
able Order") and to have conditionally exercised the Option. If
the Option and this Agreement are not subsequently terminated by
Garwood, and if the Acceptable Order remains unchanged by the
Commission or any court, then the City shall be deemed to exercise
the Option on the date that such Acceptable Order becomes final,
as set forth below in this Paragraph 7. An "Order" is any decision
or order of the Commission granting, denying or dismissing the
Application in whole or in part. The "Date of Conditional
Exercise" for any Order is the tenth day after the date that the
City, or its attorney of record in the hearing or other proceeding
before the Commission on the Application, is notified of that
Order.
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The Acceptable Order shall become final within the meaning of
this Agreement upon the earliest of the following dates (the "Final
Date"): (1) in the absence of a timely motion for rehearing
complaining of the Acceptable Order, on the expiration of the
period of time for filing such a motion for rehearing under Section
16(e) of the Administrative Procedure and Texas Register Act, art.
6252-13a, V.T.C.S. ("APTRA"); (2) in the absence of a timely
petition to a District Court of Travis County appealing the
Acceptable Order, on the expiration of the period of time for
filing such a petition under Section 19(b) of APTRA; or (3) upon
entry by any court of competent jurisdiction of a non -appealable
judgment or order affirming the Acceptable Order, or upon any such
judgment or order becoming non -appealable.
Commencing on the Final Commission Date (hereinafter defined),
interest shall accrue on the Purchase Price at the Interest Rate
(hereinafter defined), until such time as the City fully exercises
the Option by paying the Amount Due. The "Interest Rate" shall be
the rate per annum equal to the lesser of: (1) the Prime Rate
(hereinafter defined) of interest as it fluctuates, or (2) the
maximum lawful rate which may be contracted for, charged, taken,
received or reserved by Garwood in accordance with the applicable
laws of the State of Texas (or applicable United States federal law
to the extent that it permits Garwood to contract for, charge,
take, receive or reserve a greater amount of interest than under
Texas law), taking into account all charges made in connection with
this Agreement which are treated as interest under applicable law.
The "Prime Rate" shall mean the base rate of interest per annum
established from time to time by Chemical Banking Corp., New York,
New York ("Chemical Bank") and designated as its prime rate.
Fluctuations in the Prime Rate shall become effective on the date
each such change in such Prime Rate is established by Chemical
Bank.
The "Final Commission Date" shall be the earlier of the
following dates: (1) in the absence of a timely motion for
rehearing complaining of an Acceptable Order, on the expiration of
the period of time for filing such a motion for rehearing under
Section 16(e) of APTRA; or (2) if a motion for rehearing complain-
ing of an Acceptable Order is filed timely, on the date of
rendition of the Commission order overruling the motion for
rehearing, or on the date the motion is overruled by operation of
law.
Nothing herein shall be construed as authorization for the
City to delay payment of the Amount Due beyond ninety (90) days
after the Final Date.
8. Termination of Option. The City may terminate the Option
and this Agreement, by giving written notice of such termination
to Garwood, at any time, except during any period of time beginning
on the Date of Conditional Exercise with respect to any Acceptable
Order as defined in Paragraph 7, above, and continuing for so long
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as such Acceptable Order remains unchanged by the Commission or any
court, and except as provided otherwise below in this Paragraph 8.
If the City does not give Garwood written notice of termination
prior to any such Date of Conditional Exercise, then the City may
not thereafter terminate this Option and this Agreement while that
Acceptable Order remains unchanged by the Commission or any court,
and if that Acceptable Order thereafter becomes final, then the
City shall automatically be deemed to fully exercise the option
upon the Final Date and the City shall pay Garwood the Amount Due
within ninety (90) days after that date.
Garwood may terminate the Option and this Agreement, by giving
written notice of termination to the City, at any time, except
during any period of time beginning on the Final Commission Date
with respect to any Acceptable Order as defined in Paragraph 7,
above, with respect to any Acceptable Order, and continuing for so
long as such Acceptable Order remains unchanged by the Commission
or any court, and except as provided otherwise below in this
Paragraph 8, if Garwood should conclude in good faith at that time
that continuation of the Option and this Agreement is likely to
result in a material, adverse impact on Garwood's Right or the use
or supply of water thereunder. The Option and this Agreement shall
terminate immediately upon the City's receipt of such notice.
If any court in an appeal from an Acceptable Order remands the
case to the Commission for the Commission to enter a new Order,
then, except as provided otherwise below in this Paragraph 8, the
Application shall be considered to be pending before the Commission
prior to the Commission's entry of any Order and any Order
subsequently entered by the Commission shall be subject to review
by the City and Garwood pursuant to Paragraph 7, above.
If any change is made to an Acceptable Order by the entry of
an order by any court in an appeal from that Acceptable Order, and
if the court does not remand the case to the Commission for the
Commission to enter a new Order that will be subject to review by
the City and Garwood pursuant to Paragraph 7, above, then the City
may terminate this Option and this Agreement by giving Garwood
written notice of termination within ten days after being notified
of such order. If any change is made to an Acceptable Order by the
entry of an order by any court in an appeal from that Acceptable
Order, and if the court does not remand the case to the Commission
for the Commission to enter a new Order that will be subject to
review by the City and Garwood pursuant to Paragraph 7, above, then
Garwood may terminate this Option and this Agreement by giving the
City written notice of termination before the deadline for Garwood
to appeal that order, if Garwood should conclude in good faith at
that time that continuation of the Option and this Agreement is
likely to result in a material, adverse impact on Garwood's Right
or the use or supply of water thereunder. The Option and this
Agreement shall terminate immediately upon the City's receipt of
such notice. If neither party gives the other party notice of
termination within the applicable time period for each party, then
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the Acceptable Order as so revised shall thereafter be deemed to
be the Acceptable Order, neither the City nor Garwood may thereaf-
ter terminate this Option and this Agreement while such Acceptable
Order remains unchanged by the Commission or any court and, if that
Acceptable Order thereafter becomes final, then the City shall
automatically be deemed to fully exercise the Option and this
Agreement upon the Final Date and the City shall pay Garwood the
Amount Due within ninety (90) days after that date.
Garwood may terminate the Option and this Agreement, by giving
written notice of termination to the City, at any time if the City
fails to make timely payment of any of the payments required by
Paragraphs 4, above, and 11, below.
Garwood may terminate the Option and this Agreement, by giving
written notice of termination to the City, at any time after thirty
(30) days after the date that Garwood receives the City's notice
to submit the Application under Paragraph 6, above, if, prior to
that time, the City had not also given Garwood the Required
Evidence under Paragraph 6, above.
Garwood may terminate the Option and this Agreement, by giving
written notice of termination to the City, at any time after three
years from the date that Garwood receives the City's notice to
submit the Application under Paragraph 6, above, if, prior to that
time, the Commission had not entered any Order or, if it had
entered an Order, no Final Commission Date with respect to any
Acceptable Order had occurred. If a Final Commission Date with
respect to an Acceptable Order does occur prior to termination of
the Option and this Agreement, and if the Acceptable Order is
appealed and the case is subsequently remanded to the Commission
by any court for the Commission to enter a new Order that will be
subject to review by the City and Garwood pursuant to Paragraph 7,
above, then Garwood may terminate the Option and this Agreement by
giving written notice to the City, at any time after five years
from the date that Garwood receives the City's notice to submit the
Application under Paragraph 6, above, if, at such time, there is
no pending Order or, if there is such a pending Order, the Final
Commission Date with respect to that Order has not yet occurred.
Upon receipt of any notice of termination from Garwood, other
than a notice of termination based on Garwood's concluding in good
faith that continuation of the Option and this Agreement is likely
to result in a material, adverse impact on Garwood's Right or the
use or supply of water thereunder, the City shall have thirty (30)
days to fully exercise the Option by giving Garwood written notice
of such exercise pursuant to Paragraph 5, above. If the City does
give Garwood such written notice of exercise, then the City,
pursuant to Paragraph 5, above, shall pay Garwood the Amount Due
within ninety (90) days after the date it gives such notice. If
Garwood does not receive such written notice of exercise within
such thirty -day period, the Option and this Agreement shall
terminate in its entirety. The City shall not object to withdrawal
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of the Application by Garwood if the Option and this Agreement are
terminated by either party pursuant to the terms of this Agreement.
If the Option and this Agreement are terminated by either
party pursuant to the terms of this Agreement, Garwood shall be
entitled to retain all amounts paid by the City pursuant to this
Agreement prior to such termination, and to recover from the City
any amounts not paid but required to be paid pursuant to this
Agreement prior to such termination. The City recognizes that the
amounts to be retained by Garwood in the event of termination are
in consideration of the extended period of time during which
Garwood has agreed to refrain from committing in excess of
Garwood's Remaining Right on a long term basis (that extended
period of time began several years before the City finally entered
into this Agreement, when the City first approached Garwood and
requested it to hold a portion of its right in reserve for the
City), and in consideration of the City's declining to purchase
Corpus Christi's Right until the right is amended to its satisfac-
tion, and in consideration of Garwood's agreeing to seek the amend-
ment without any commitment from the City that it would purchase
the right after the Commission acts. The City further recognizes
that the amounts retained by Garwood in the event of termination
should be the same regardless of which party terminates, so long
as the termination is pursuant to this Agreement.
9. Conveyance of Right by Garwood. Upon receipt of payment
of the Amount Due, Garwood shall convey Corpus Christi's Right, as
it exists at that time (whether that be as it is created when
Garwood divides Garwood's Right into two portions pursuant to
Paragraph 6, above, or as it is amended by an Acceptable Order and
subsequent court orders, if any, or as it is subject to amendment
pursuant to a pending Application), to the City, by written
conveyance in the form attached hereto as Exhibit 1 (the "Convey-
ance Document"), modified and completed as set forth below. The
Conveyance Document shall be modified and completed as appropriate
to accurately reflect Corpus Christi's Right, and other relevant
facts, as they exist at the time. The modifications and comple-
tions shall include the following: provisions in the Conveyance
Document that are within brackets shall be included as shown,
modified, or deleted; numbers, dates or other information indicated
as being needed shall be added; and choices indicated as needed to
be made shall be made; all as appropriate to accurately reflect the
facts as they exist at the time. Corpus Christi's Right, as
conveyed to the City, shall prohibit the diversion of water from
the point of diversion on the Colorado River authorized under
Garwood's Right utilizing Garwood's pumping plant or otherwise, and
the use of Garwood's canal system to convey such water, unless
Garwood in its absolute discretion should agree otherwise. Corpus
Christi's Right, as conveyed to the City, shall not be appurtenant
in any respect to any of the facilities authorized or existing
under Garwood's Right including, without limitation, Garwood's
pumping facilities, canal system, and low water dam. Notwith-
standing anything herein to the contrary, under no circumstances
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shall Garwood be required at any time to convey Corpus Christi's
Right to the City if, and to the extent that, the number of acre-
feet authorized to be diverted and used annually under Garwood's
Remaining Right, as it exists at that time or as it may exist after
the conclusion of any administrative or judicial proceeding that
is pending at that time, is less than 133,000 acre-feet per year.
If Garwood does convey Corpus Christi's Right to the City pursuant
to this Paragraph, then, except as provided otherwise in Paragraph
10, below, the Option and this Agreement shall terminate upon such
conveyance, and upon such termination the foregoing sentence shall
have no further force or effect whatsoever.
10. Pullin Station and Conveyance Facility. The City presently
contemplates that it will construct a separate pump station and
pipeline to convey water from the Colorado River to the City of
Corpus Christi and its service area, either directly or via Lake
Texana. At the present time, the City anticipates that the point
of diversion for the pump station will be located on the west bank
of the Colorado River, either on the small reservoir created by
Garwood's low water dam, on land owned by Garwood, within Segment
"A" as shown on Exhibit 2 attached hereto, or upstream of the small
reservoir created by Garwood's low water dam, on land owned by
third parties, within Segment "B" of the River as shown on Exhibit
3 attached hereto, or downstream of Garwood's low water dam, on
land owned by third parties, within Segment "C" of the River as
shown on Exhibit 4 attached hereto. Regardless of the location of
the pump station, the conveyance of water from the Colorado River
and from the pump station shall be by pipeline only, utilizing a
route, design, and procedures for construction, operation, mainte-
nance and repair that do not interfere with Garwood's irrigation
and other operations. The City shall be responsible for obtaining
all lands, easements and other interests in land necessary for such
pump station and pipeline.
If the City should decide that it desires to investigate
seriously the question of whether it should locate its pump station
on the reservoir created by Garwood's low water dam, then it shall
so advise Garwood, and both parties agree to negotiate in good
faith to determine whether they can agree upon the terms and
conditions of an agreement that would allow the City to purchase
from Garwood a portion of the land within Segment "A" for a pump
station to pump the water available under Corpus Christi's Right.
Any such agreement must include terms and conditions adequately
addressing all relevant issues, including the following: the size,
location, and configuration of the site; the price and other terms
for the purchase of the site; the financial and other contributions
by the City towards the maintenance, operation, repair, replacement
and improvement of the dam; the financial and other contributions
by the City towards the maintenance, repair and stabilization of
the river banks abutting the small reservoir created by the dam and
immediately downstream of the dam; and safeguards to insure that
the construction, operation, maintenance and repair of the pump
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station, the intake to the pump station and the pipeline from the
pump station will not interfere with any of Garwood's operations.
The City agrees that, if for whatever reason it and Garwood
are unable to reach such an agreement on or before the earliest of
January 1, 1996, or the date the Option and this Agreement are
terminated, or the Date of Conditional Exercise for any Order, then
the City shall not construct any pump station, or locate any point
of diversion for any pump station, anywhere on either bank of the
Colorado River within a segment of the River upstream of Garwood's
low water dam beginning at the dam and extending upstream to the
most downstream point within Segment "B."
11. Amendment of Corvus Christi's Riaht. Upon Garwood's
receipt from the City of both the written notice to submit the
Application and the Required Evidence under Paragraph 6, above,
Garwood, to the extent that it has not already done so before that
time, shall promptly prepare and submit the Application to the
Commission. Garwood shall thereafter pursue the Application before
the Commission and assist the Commission in defending any Accept-
able Order against challenges by others in the courts. The
Application shall seek to amend Corpus Christi's Right to:
(a) authorize the use of such water for municipal
and industrial purposes;
(b) authorize the diversion of such water from an
undefined point of diversion on the west bank of the
Colorado River within either Segment "A" on the Colorado
River as shown on Exhibit 2, Segment "B" on the Colorado
River as shown on Exhibit 3, or Segment "C" on the
Colorado River as shown on Exhibit 4;
(c) confirm that the right already exists, or grant
the right, to divert such water from the Colorado River
Basin and transfer it for use within Aransas, Atascosa,
Bee, Duval, Jim Wells, Kleberg, Live Oak, McMullen,
Nueces and San Patricio Counties; and
(d) confirm that Corpus Christi's Right, as so
amended, retains the November 1, 1900 priority date of
Garwood's Right.
The Application shall be reviewed and approved by the City
before it is submitted to the Commission.
The City agrees to seek intervention in any hearing or other
proceeding on the Application as a party in support of the Applica-
tion, to make its employees and consultants available to develop
or assist in developing the necessary documents to be filed with
the Commission as part of the Application or otherwise, to testify
in support of the Application, and to otherwise support the
Application, and to seek intervention in any appeal from an
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Acceptable Order as a party in support of such order, all at no
cost to Garwood. The City shall reimburse Garwood for all reason-
able and necessary costs incurred by Garwood in preparing, filing
and pursuing such an amendment and in assisting the Commission in
defending any Acceptable Order against challenges by others in the
courts ("Reimbursable Application Costs"). Such costs shall
include all reasonable and necessary costs incurred by Garwood for
all legal, engineering and other assistance utilized by Garwood,
as well as all expenses incurred by Garwood. Garwood shall submit
an itemized bill to the City for all Reimbursable Application Costs
on a monthly basis, and the City shall pay each bill within 30 days
of receipt. Nothing in this Agreement shall prohibit or restrict
Garwood in any way or at any time from seeking whatever amendments
to Garwood's Water Right, and whatever modifications to Garwood's
pumping facilities, canal system, and low water dam, that Garwood
may desire.
12. LORA Aareement. By this Agreement, Garwood is not
granting any option or conveying any interest whatsoever in its
LCRA Agreement. No interest in the LCRA Agreement shall be deemed
to be appurtenant to Corpus Christi's Right, or shall otherwise be
conveyed to the City with Corpus Christi's Right.
13. Tailwater from Garwood's Irrigation Oaerations. Garwood
shall not be required to maintain any flows into Lake Texana from
any tailwater, surplus water or return flow water whatsoever from
Garwood's irrigation operations, and Garwood reserves the right to
maintain control of such waters and to use, reuse and consume them
entirely for irrigation purposes prior to their flowing from
Garwood's service area, as such service area is defined by Certifi-
cate of Adjudication No. 14-5434.
14. Water Ouality. Garwood makes no representations whatso-
ever with respect to the quality of water in the Colorado River,
and it shall have no obligation whatsoever with respect to the
quality of such waters.
15. No Third Party Beneficiary. The parties are entering
into this Agreement solely for the benefit of themselves and agree
that nothing herein shall be construed to confer any right,
privilege or benefit on any person or entity other than the parties
hereto and their successors and assigns.
16. No Assignment. The City may not assign any of its rights
and obligations to any other person or entity without first
obtaining Garwood's written consent, which Garwood in its absolute
discretion may withhold.
17. Source of Funds. Any payment required to be made by the
City shall be paid only from lawfully available funds; provided,
however, before the City incurs any obligation pursuant to this
Agreement to make a particular payment to Garwood, the City shall
take all actions necessary to insure that sufficient funds are or
-11-
will be lawfully available to make the payment by the date required
under this Agreement. No Debt (hereinafter defined) is created by
the City by entering into this Agreement, and no Debt can be
created by the City pursuant to this Agreement unless and until the
City fails to give Garwood written notice of termination under
Paragraph 8, below, before the Date of Conditional Exercise for any
Order. "Debt" means the term "debt" as such term is used in Art.
11, Sec. 5, Constitution of the State of Texas.
18. Waiver. Any waiver at any time by either party with
respect to a default or any other matter arising in connection with
this Agreement shall not be deemed a waiver with respect to any
subsequent default or matter.
19. Captions. The captions and headings appearing in this
Agreement are inserted merely to facilitate reference and shall
have no bearing upon the interpretation thereof.
20. Notice. Each notice under this Agreement shall be mailed
by certified mail, return receipt requested, and shall be effective
on the date actually received. All notices to the City shall be
addressed to:
Juan Garza
City Manager
City of Corpus Christi
City Hall
1201 Leopard
Corpus Christi, Texas 78401
and all notices to Garwood shall be addressed to:
William N. Lehrer
Chairman and Chief Executive Officer
Garwood Irrigation Company
P. O. Box 428
Garwood, Texas 77442
Either party may change its address by giving written notice of
such change to the other party.
-12-
IN WITNESS WHEREOF, this Agreement is executed on behalf of
the City and Garwood by their respective authorized officers, in
multiple counterparts, each of which shall constitute an original.
ATTEST:
City Secretary
ATTEST:
Ikcy
lati^cli2
Secretary
Approved as to legal form:
James H. Bray Jr., City Attorney
CITY OF CORPUS CHRISTI, TEXAS
By
Juan Garza
City Manager
GARWOOD IRRIGATION COMPANY
By �t�[ w c. 14 i z
William N. Lehrer
Chairman and
Chief Executive Officer
-13-
STATE OF TEXAS
COUNTY OF NUECES
§
BEFORE ME, the undersigned authority, on this day personally
appeared Juan Garza, City Manager of the City of Corpus Christi,
Texas, known to me to be the person and officer whose name is
subscribed to the foregoing instrument, and acknowledged to me that
he executed the same for the purposes and consideration therein
expressed, and in the capacity therein stated, and as the act and
deed of said City of Corpus Christi, Texas as duly authorized by
the City Council of said City.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS THE day of
September, 1992.
STATE OF TEXAS
COUNTY OF COLORADO
§
§
NOTARY PUBLIC STATE OF TEXAS
PRINTED NAME OF NOTARY
My Commission Expires
BEFORE ME, the undersigned authority, on this day personally
appeared William N. Lehrer, Chairman and Chief Executive Officer
of Garwood Irrigation Company, known to me to be the person and
officer whose name is subscribed to the foregoing instrument, and
acknowledged to me that he executed the same for the purposes and
consideration therein expressed, and in the capacity therein stat-
ed, and as the act and deed of said Garwood Irrigation Company.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS THE IQ,th day of
September, 1992.
MONICA 0. MAERTZ
NOTARY PUBLIC
STATE OF 0 6 s�t144
C93
7 F
r
NOTARY PUBLIC ST TE OFSTEXAS
•
PRINTED NAME OF NOTARY
My Commission Expires
-14-
Exhibit 1
Exhibit 2
Exhibit 3
EXHIBITS
Form of conveyance conveying Corpus Christi's Right
to the City.
Map defining Segment "A" of the Colorado River, on
the reservoir created by Garwood's low water dam.
Map defining Segment "B" of the Colorado River,
upstream of the reservoir created by Garwood's low
water dam.
Exhibit 4 Map defining Segment "C" of the Colorado River,
downstream of Garwood's low water dam.
CONVEYANCE OF WATER RIGHT
STATE OF TEXAS §
§
COUNTY OF COLORADO §
This Conveyance of Water Right (this "Conveyance") is made as
of , 19_, by GARWOOD IRRIGATION COMPANY ("Grant-
or"), to THE CITY OF CORPUS CHRISTI ("Grantee").
This conveyance (this "Conveyance") is executed pursuant to
the terms of that certain Agreement between Grantee and Grantor,
entered into as of the day of September, 1992 (the "Agree-
ment"). Pursuant to the terms of the Agreement, by notice dated
, 19_, Grantee specified that Corpus Christi's
Right (as defined in the Agreement) consisted of a [Acre -Feet
Specifiedl acre -foot -per -year portion of Garwood's Right (as
defined in the Agreement). The number of acre -feet -per -year so
specified in the notice is hereinafter referred to as the "Acre -
Feet Specified." Garwood's Right, as defined in the Agreement, is
reflected by Certificate of Adjudication No. 14-5434, issued by
the Texas Water Commission on June 28, 1989. A copy of that
Certificate of Adjudication is attached hereto as Exhibit A.
Pursuant to the terms of the Agreement, by instrument dated
, 19_, Grantor divided Garwood's Right into two
portions. Under one portion, defined in the Agreement as Corpus
Christi's Right, Garwood [is or was] authorized to divert and use
[Acre -Feet Specifiedl acre-feet of water per year from the Colorado
EXHIBIT 1
Page 1 of 6
River for irrigation, at a rate of diversion not to exceed [Acre -
Feet Specified = 16$.000 x 7501 cubic feet per second ("cfs").
Under the other portion, defined in the Agreement as Garwood's
Remaining Right, Garwood is authorized to divert and use f168.000 -
Acre -Feet Specified._ but in any event not less than 133.0001 acre-
feet of water per year (such number of acre -feet -per -year is
hereinafter referred to as the "Acre -Feet Remaining") from the
Colorado River for irrigation, at a rate of diversion not to exceed
(Acre -Feet Remaining = 168.000 x 750] cfs. From and after the date
of such division of Garwood's Right, the Portion of Garwood's Right
defined as Corpus Christi's Right has been, and it now is,
subordinate, in time priority and all other respects, to the
portion defined as Garwood's Remaining Right.
Pursuant to the terms of the Agreement, the Purchase Price (as
defined in the Agreement) for the purchase of Corpus Christi's
Right is [S400.00 x Acre -Feet Specified], the date that Grantee
exercised, or was deemed to have exercised, the Option (as defined
in the Agreement) was , 19_, [the Final Commission
Date (as defined in the Agreement) was , 19_, and
the accrued interest on the Purchase Price from the Final Commis-
sion Date to the date of payment of the Amount Due (as defined in
the Agreement), the Reimbursable Application Costs (as defined in
the Agreement), and the Amount Due, as of the date of this Convey-
ance, are [S 1, [S
T T r
], and [S 1, respectively.]
EXHIBIT 1
Page 2 of 6
[Pursuant to the terms of the Agreement and the
_, 19_ notice given by the City of Corpus Christi, Garwood
submitted to the Texas Water Commission an application to amend
Corpus Christi's Right (defined in the Agreement as the "Applica-
tion"). The Application [is pending before the Water Commission,
or was [granted or denied or dismissed] [in whole or in part] by
the Water Commission by order dated , 19_ (the
"Order")]. A copy of the Order is attached hereto as Exhibit B.
The Order [became final on , 19_, or has not yet
become final], as such term is defined in the Agreement.]
For and in consideration of the sum of [the Amount Duel and
other good and valuable consideration to Grantor paid by Grantee,
the receipt of which is hereby acknowledged, Grantor does hereby
grant, bargain, sell, convey and assign unto said Grantee, the
Conveyed Water Right (hereinafter defined). The "Conveyed Water
Right," as conveyed hereby, is Corpus Christi's Right as specified
by Grantee by its notice dated , 19_, [as such
right is amended by the Order or as such right may be amended by
the Water Commission pursuant to the Application], [as such right
was modified by court order and/or is subject to judicial review],
[together with all rights and obligations of Grantor in the
Application or in any appeals from the Order pending as of the date
of this Conveyance], subject to the following limitations,
conditions and restrictions:
1. The Conveyed Water Right, and the rights of Grantee
and its successors -in -interest in and to the
EXHIBIT 1
Page 3 of 6
I
Conveyed Water Right, are, and shall hereafter
continue to be, subordinate in time priority and all
other respects to Garwood's Remaining Right, and to
the rights of Grantor and its successors -in -interest
in and to Garwood's Remaining Right.
2. The Conveyed Water Right is not, and shall hereafter
continue not to be, appurtenant in any respect to
any of the facilities authorized or existing under
Garwood's Right including, without limitation,
Garwood's pumping facilities, canal system, and low
water dam. No interest in any lands or any facili-
ty authorized or existing under Garwood's Right is
hereby conveyed to Grantee. Unless Grantor in its
absolute discretion should agree in writing other-
wise, Grantee and its successors -in -interest are,
and hereafter shall continue to be, prohibited from:
a. diverting any water under the Conveyed Water
Right from the point of diversion on the
Colorado River authorized under Garwood's
Right, utilizing Grantor's pumping facilities
or otherwise;
b. utilizing any portion of Grantor's canal system
or other facilities to convey any water di-
verted under the Conveyed Water Right; and
EXHIBIT 1
Page 4 of 6
c. interfering in any way with Garwood's Remaining
Right or the use or supply of water thereunder.
TO HAVE AND TO HOLD, the Conveyed Water Right as conveyed
herein, together with all and singular the rights and appurte-
nances thereto in anywise belonging, except that which is reserved
to Grantor and except that which is inconsistent in any way with
any of the limitations, conditions and restrictions set forth in
this Conveyance, unto the Grantee, its successors and assigns
forever; and Grantor does hereby bind itself and its successors
and assigns to warrant and forever defend the title to said Con-
veyed Water Right unto the said Grantee, its successors and as-
signs, against all persons whomsoever lawfully claiming or to
claim the same or any part thereof, by, through or under it, said
Grantor.
Executed this
day of , 19
GARWOOD IRRIGATION COMPANY
By:
ATTEST:
EXHIBIT 1
Page 5 of 6
1 r 7
STATE OF TEXAS
§
COUNTY OF COLORADO
BEFORE ME, the undersigned authority, on this day personally
appeared
Garwood Irrigation Company, known
officer whose name is subscribed to
acknowledged to me that he executed
consideration therein expressed, and
ed, and as the act and deed of said
of
to me to be the person and
the foregoing instrument, and
the same for the purposes and
in the capacity therein stat -
Garwood Irrigation Company.
GIVEN UNDER MY HAND AND SEAL OF OFFICE THIS THE day of
, 19_
NOTARY PUBLIC STATE OF TEXAS
PRINTED NAME OF NOTARY
My Commission Expires
EXHIBIT 1
Page 6 of 6
9/22/92' 12:44 HDR ENGINEERING • 8803839 -
SEP -22-'92 TUE 12:18 ID:CH2M._HILL D/FW TEL NO:N14-395-0846
4 plot defining garment "A" at the Colorado give*
'Waft's of Garwood leripatiau Company's raw water Dam.
iripv
arts
4gwon
44w41
• ~"iii
NO
t$855 P02
D02
N.
I
'1
1*/
4-
)j
Sam.ta( Kan ntlty Le*3ui
Absrl.. Ne. 4e
Data used on this Dlat va1 done by tape massora
and aerial photograph information. Exact location of tract
will be provided later by field survey and metas and bounds
gaga Lit Lon. Sal; I r �!9r
EXHIBIT 2
AN
19/22/9=' " 12:45 HDR ENGINEERING y 8803839
SEP -22-'92 TUE 12:18 ID:CH2M HILL D/FLJ
NC
TEL NO:N14-385-084\ p85$_P6-
P03
1 INCH IN 2,000 FEET
SEGMENT
APPROX. 22 RIVER MILES
TO COLUMBUS, TX
sirt
13,000 ' R
2.46 RIVER MILES
t.
SCHISIT 3
SEGMENT "B"
22/32. ' 12:47
SEP -22-'92 TUE 12:19 ID:CH2MHILL D'FW
HDR ENGINEERING + S803839 '
•
•
TEL NO:N14-385-0846
14,
•
NC
,. #SB55 PO4
D04
11 INCH - 2,006 FEET 1
\,./
/
j o%t ,:
6'
MO
Guw
BEGIN SEGMENT °C1-4 RIVER MILES DOWNSTREAM OF FM 960 BRIDGE
P
r
• .
M
•
Is?
N
• 'yr
w -i
.,'
W
e...I
SEGMENT °C''.
TO 8 MILES SOUTH OF BAY CITY,TX (APPROX.)
EXHIBIT 4
QrrMFNT "C:"