S-595 - 08/12/1986 - WATER - Ordinances Exhibits a 0
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' Counties of DuPage, Cook and Will, Illinois ;
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PURCHASE AND SALE CONTRACT R,
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1986
DuPAGE WATER COMMISSION
COUNTIES OF DuPAGE, COOK AND WILL, ILLINOIS
AND
VILLAGE OF ADDISON
VILLAGE OF BENSENVILLE
VILLAGE OF BLOOMINGDALE
VILLAGE OF CAROL STREAM
VILLAGE OF CLARENDON HILLS
CITY OF DARIEN
VILLAGE OF DOWNERS GROVE
CITY OF ELMHURST
VILLAGE OF GLENDALE HEIGHTS
VILLAGE OF GLEN ELLYN
VILLAGE OF HINSDALE
VILLAGE OF ITASCA
VILLAGE OF LISLE
VILLAGE OF LOMBARD
CITY OF NAPERVILLE
VILLAGE OF OAK BROOK
CITY OF OAKBROOK TERRACE
VILLAGE OF ROSELLE
VILLAGE OF VILLA PARK
VILLAGE OF WESTMONT
CITY OF WHEATON
VILLAGE OF WILLOWBROOK
CITY OF WOOD DALE
VILLAGE OF WOODRIDGE
WATER PURCHASE AND SALE CONTRACT
DATED AS OF JUNE 11, 1986.
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DuPAGE WATER COMMISSION
WATER PURCHASE AND SALE CONTRACT
Table of Contents
Page
PREAMBLES
Section 1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
I ' ' ' 3
Section 2. Water Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a) Agreement to Purchase and Sell . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
(b) Certain Limits on Supply and Commission's Power to Contract . . . . . . . . . . . . . 3
(c) Emergency or Maintenance Shut-Off . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . 3
(d) Curtailment; Emergency Use of Other Sources . . . . . . . . . . . . . . . . . . . . . . . . . . 3
(e) Water Quality 3
Section 3. Storage, Delivery, Distribution and Conservation 3
(a) Storage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
(b) Points of Delivery, Back-Flows, Pressure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(c) Charter Customer to Maintain Water Quality and Unit System
and to Prevent Waste. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Section 4. Measuring Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(a) Commission to Supply Equipment, Official Record . . . . . . . . . . . . . . . . . . . . . . . 4
(b) Calibration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(c) Check Meters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(d) Variations between Meters; Reconciliation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(e) Removal of Commission Metering Station . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 5. Unit of Measurement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 6. Prices and Terms of Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Operation and Maintenance Costs; Underconsumption Costs . . . . . . . . . . . . . . . . 5
(b) Fixed Costs 5
. . . . . . . . . . . . . . . . . . . . . . .
(c) Bills and Due Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(d) Default Shares . . . . . . . . . . . . . . . . . . . . . .. . . . .. . . . . . . . . . . . . . . . . . . . . . . . . 5
(e) Disputed Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 j
(f) Interest on Overdue Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(g) Security Deposit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(h) Rates to Charter Customers Same. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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(i) Limitation on Payments; Net Indebtedness of Charter Customers . . . . . . . . . . . . 8
�) May Use Other Moneys. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(k) Sole Method for Charter Customers to Enforce Provisions Hereof
Against Other Customers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I . . . . . . . . . . . 8
(1) Beginning of Obligation to Pay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(m) Provision In Lieu of Water Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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Section 7. Procedural and Other Limitations; Further Covenants of the Commission . . . . . . . . . 8
(a) Procedural Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Lake Water Only 9
(c) Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(d) Covenants to Be Set Out in Bond Ordinance . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(e) Absolute Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(f) Emergency Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(g) Governance . . . . . . . .. . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(h) Retail Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(i) Evidence of Customer Action 9
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(I) Limitation on Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(k) General Obligation Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(1) Certain Budget, Rate Limitation, Notice and Hearing Provisions . . . . . . . . . . . . 9
(m) Use of Sales Taxes to Rebate Charges In Limited Circumstances . . . . . . . . . . . 9
Section 8. Special Conditions and Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(a) Commission to Build Waterworks System and Supply Lake Water . . . . . . . . . . 10
(b) Title to.Lake Water. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(c) Commission to Use Best Efforts to Build and Finance Construction. . . . . . . . . . 10
(d) Payments Hereunder an Operation Expense of Unit Systems . . . . . . . . . . . . . . . 10
(e) Commission Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(f) Commission to Continue to Serve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(g) Commission Covenant to Operate Properly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 9. Additional Charter Customer Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(a) Maintain and Operate Unit System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(b) Rate Covenant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(c) Segregate Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II
(d) Future Subordination of Revenue Bond Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 I
(e) General Covenant to Operate Properly . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(f) Accounting and Audit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(g) Maintain Ownership of Unit System and Properties . . . . . . . . . . . . . . . . . . . . . . t 1
(h) Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(i) Budget and Appropriations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(]) Continue to Serve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(k) Maintain Water Allocation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
p) Combining or Separating Unit System Accounts. . . . . . . . . . . . . . . . . . . . . . . . . . I I
(m) Customer Covenants as to Rate of Withdrawal. . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 10. Election as to Water Purchase Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 i
Section 11. Abandonment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 !
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Section 12. Subsequent and Other Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
(a) No Contract With Rate More Favorable. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . 12
(b) Occasional Service Only Except to Contract Customers . . . . . . . . . . . . .. . . . . . 12
(c) Subsequent Contract Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 13. Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 14. Commission Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 15. Charter Customer's Obligation Unconditional . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 16. Modification of this Contract or of the Chicago Water Supply Contract . . . . . . . . . 13
Section 17. Non-Assignability . . . . . . . . . . . 13
Section 18. Cooperation In Construction of Commission Water Supply. . . . . . . . . . . . . . . . . . . . 13
Section 19. Mutual Cooperation in Issuance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 20. Regulatory Bodies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 21. Commission Cooperative Arrangements With Other Water Suppliers. . . . . . . . . . . . 13
Section 22. Notices and Evidence of Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 23. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 24. Effective Date and Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 25. Governing Law; Superseder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 26. Execution in Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I . . . . . . . 14
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EXHIBIT1 Map . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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List of Defined Terms and References
Term
Page
Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Aggregate Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2
Bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Bond Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Charter Customers 2
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CharterDate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Chicago Water Supply Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Commission. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Contract. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Contract Customers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Costs of the Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Customer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
FiscalYear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Fixed Costs . . . . . . . . . . . . . . . 2
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Full Water Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
LakeWater . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Minimum Take or Pay Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Operation and Maintenance Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Prior Contracts 2
Project . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Rebate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Rebate Recipients . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . l0
60% Completion Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Subsequent Customer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Subsequent Contract . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . 2
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Underconsumer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Underconsumption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Underconsumption Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Underconsumption Ratio. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
UnitSystem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 3
Water Allocation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Waterworks System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
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DuPAGE WATER COMMISSION
COUNTIES OF DuPAGE, COOK AND WILL, ILLINOIS
WATER PURCHASE AND SALE CONTRACT
This Water Purchase and Sale Contract, dated as of June 11, 1986, by and between the DuPage Water Commission,
Counties of DuPage, Cook and Will, Illinois (the "Commission"), a commission and public corporation under Division 135
of Article 1 I of the Illinois Municipal Code and the Water Commission Act of 1985 and each of the following units of local
government of the State of Illinois:
Unit of Local Government
Village of Addison Village of'Lisle
Village of Bensenville Village of Lombard
Village of Bloomingdale City ofNaperville
Village of Carol Stream Village of Oak Brook
Village of Clarendon Hills City of Oakbrook"Terrace
City of Darien Village of Roselle
Village of Downers Grove Village of Villa Park
City of Elmhurst Village of Westmont
Village of Glendale Heights City of Wheaton
Village of Glen Ellyn Village of Willowbrook
Village of Hinsdale City of Wood Dale
Village of Itasca Village of Woodridge
W ITNESSETH:
WHEREAS,the Commission has been organized under said division and of their respective Unit Systems, except as expressly limited in this Con-
act(collectively,the"Act")to supply water within its territorial limits,and tract, nor is the Commission surrendering any of its rights to the owner-
ship and operation of its Waterworks System,but all expressly assert their
WHEREAS,the aforementioned units of local government(the"Charter continued right to operate such systems; and
Customers"as hereafter defined)have each executed counterparts of this
Contract and are authorized under the Act to receive potable water from WHEREAS, it is known to the Charter Customers that the Commission
Lake Michigan("Lake Water"as hereafter defined)through the instrumen-
tality of the Commission and,by executing this Contract,are enabling the cipal of anJ premium, it any,and interest on the Bonds and as the means
Cununission to construct and complete its waterworks system(the"Water- liu the payment of its maintenance and operating expenses; and for the
works System"as hereafter defined); and establishment and maintenance of accounts and reserves for such purposes
WHEREAS,the Charter Customers cacti have a waterworks system(a its may be required in the Bond Resolution authorizing issuance of Bonds
"Unit System"as hereafter defined)and have each received or may pro-
or authorized by applicable statutes; and
perly petition to receive from the State of Illinois Department ofTranspor- WHEREAS,the Charter Customers recognize that the Commission may
tation a"Water Allocation"as hereafter defined; and in the future enter into contracts with other"Subsequent Customers"as
hereafter defined and other customers as may be served from time to time
WHEREAS,the Commission has entered into a contract with the City who have Water Allocations; and
of Chicago to purchase Lake Water sufficient to meet the water supply needs
of the Commission and the Charter Customers and others (the"Chicago WHEREAS,certain Charter Customers were members of the Commission
Water Supply Contract"as hereafter defined); and as it existed under prior law and previously entered into water purchase
contracts(the"Prior Contracts"as hereafter defined)with the Commission,
WHEREAS, the Commission proposes to issue and sell its"Bonds"as which gave them substantial rights not only as contracting parties,but also
hereafter defined from time to time during the term of this Contract in suf- as voting members of the Commission;and such Charter Customers would
• licient amounts for the payment of"Costs of the Project"as hereafter defined;
not enter into this Contract,which cancels the provisions of the Prior Con-
and tracts, unless this Contract retained many of the powers and protections
accorded to them in the Prior Contracts; and
WHEREAS,the Bonds will be issued from time to time by the Commis-
sion pursuant to a"Bond Resolution"as hereafter defined; and WHEREAS, the Commission, in Section 5(c) its By-Laws, requires
u greater than co majority vote containing a certain composition of Commis-
WHEREAS,pursuant to the Act,Article VII, Section 10 of the Illinois sioners to validate certain motions,resolutions or ordinances;and the Charter
Constitution of 1970, and the Intergovernmental Cooperation Act, as Customers enter into this Contract in reliance upon the continuation of pro-
amended,the Commission and the Charter Customers are authorized to enter cedural rules of the Commission as set forth in said Section 5(c)which grant
into this Contract; and (his vote and composition; and
WHEREAS, by the execution of this Contract, the Charter Customers WHEREAS,this Contract also contains certain requirements for the nature
are surrendering none of their respective rights to the ownership and operation and composition of the vote of the Commission required to effectuate cer-
I
tain actions relating to the contractual rights of the Charter Customers herein; "Costs of the Project"means, with respect to a Project,all costs of the
and such Charter Customers execute this Contract in reliance upon the con- Project, including costs of the acquisition of necessary lands,easements,
tinuation of such requirements for the term of this Contract; and and rights-of-way over lands and waters; the erection, construction,
rehabilitation,repair and replacement of pumping,storage or other facilities,
WHEREAS,the Charter Customers have entered into this Contract in and the installation of mains and pipelines;costs of financing and administra-
reliance upon Section 20)of the Water Commission Act of 1985 which tion during any period of acquisition,erection,construction,rehabilitation,
provides that units of local government may enter into contracts for the supply repair,replacement or installation,as aforesaid;costs of repayment of such
of Lake Water with the Commission in contemplation of and reliance upon interim indebtedness as may be incurred for such costs, including ad- +
the pledge of the State of Illinois that no subsequent legislation would im- ministrative expenses prior to issuance of Bonds for a Project; and costs
pair or limit the power or ability of a County Water Commission or a unit for such other purposes, including without limitation reasonable reserves
of local government fully to carry out the terms of any contract for the supply and working capital, as may be determined by the Commission.
of Lake Water;and,in particular,the rights of the Charter Customers and
the obligations of the Commission under this Contract are intended by the "Customer"means any customer purchasing water from the Commission,
Charter Customers and acknowledged by the Commission to be subject to including Contract Customers.
such pledge and agreement of the State of Illinois;
"Fiscal Year"means the fiscal year of the Commission.
NOW,THEREFORE,in consideration of the foregoing recitals and of
the mutual covenants and agreements herein contained,the parties hereto "Fixed Costs"means an amount sufficient at all times to pay the prin-
hereby agree as follows: cipal of and premium, if any,and interest on Bonds, to provide reserves
required therefor,to provide an adequate depreciation fund for the Water-
The preambles hereto are hereby incorporated herein by reference, as works System,to comply with the covenants of the Bond Resolution,and
if set out in full. Section numbers and captions are for reference and con- to pay reasonable capital costs necessary to carry out the corporate pur-
venience only and do not expand or limit the meaning as contained in the poses and powers of the Commission;and except as any of the above are
text of this Contract.A definition in the singular may be used in the plural, included in Operation and Maintenance Costs,
and vice-versa.
"Full Water Requirements"means,with respect to a Customer,the amount
Section 1. Definitions. The following words and phrases shall have of water necessary from time to time to meet the potable water requirements
the following meanings when used in this Contract,unless the context clearly of all then current customers served by the Unit System of such Customer
indicates a different meaning is intended. (including municipal use where applicable)whether within or without the
corporate limits or applicable service area of such Customer.
"Act"means Division 135 of Article 1 I of the Illinois Municipal Code
and the Water Commission Act of 1985. "Lake Water"means potable,filtered water drawn from Lake Michigan.
"Aggregate Costs"means Operation and Maintenance Costs,Fixed Costs "Minimum Take or Pay Requirement"means a requirement that a cer-
and Underconsumption Costs, collectively, as herein defined. tain minimum amount of Lake Water from the Waterworks System will
be taken or, if not taken, will be paid for on the same basis as if taken.
"Bonds"means all of the Commission's obligations which are payable
from the revenues of the Waterworks System,whether in the form of bonds, "Operation and Maintenance Costs"means amounts payable under the
notes,or other evidences of indebtedness, in whatever original principal Chicago Water Supply Contract,but not including Undcrconsumption Costs
amount,together with any such additional revenue obligations authorized except as provided in Section 10 of this Contract,and similar water supply
by statute to be issued by the Commission from time to time and refunding contracts, and all expenses incurred in the administration, operation and
revenue obligations issued to refund other such obligations. maintenance of the Waterworks System and the accumulation of reserves
related to payment of said costs. Upon the adoption of a Bond Resolution
"Bond Resolution" means the Commission's bond resolution or bond by the Commission in connection with the sale of Bonds, Operation and
resolutions or bond ordinance or bond ordinances under which the Com- Maintenance Costs payable under this Contract shall in any month at least
mission will authorize the issuance of and issue Bonds. be equal to the amount required to be deposited in that month into the opera-
tion and maintenance fund or account created under the Bond Resolution.
"Charter Customers"means the units of local government named as in-
itial parties hereto in the heading of this Contract and which do properly "Prior Contracts"means the water purchase contracts between the Com-
authorize the execution of and execute a counterpart of this Contract as ac- mission and certain Charter Customers,executed on various dates in the
ceptance hereof and file the same with the Clerk of the Commission on or year 1984, providing for a supply of Lake Water.
before the Charter Date as provided in Section 24 hereof.
"Project"means any acquisition or construction for the provision of Lake 4
"Chicago Water Supply Contract"means the water supply contract,dated Water related to the Waterworks System including initial acquisition and
December 14, 1983, between the Commission and the City of Chicago, construction thereof and all future improvements or extensions, acquisi-
Illinois, as amended or supplemented from time to time. tion, construction, repair or replacement thereof.
"Commission" means the DuPage Water Commission, Counties of "Subsequent Customer"means a customer of the Waterworks System
DuPage, Cook and Will, Illinois. which has a Water Allocation,is not a Charter Customer and is served pur-
suant to a Subsequent Contract.
"Contract"means this contract.
"Subsequent Contract"means a contract which provides for a Customer
"Contract Customers" means Charter Customers and Subsequent to either take its Full Water Requirements from the Waterworks System
Customers, collectively. or contains a Minimum Take or Pay Requirement and which contract
2
further provides for storage and other requirements,terms of payment(ex- to a maximum rate of Lake Water in any one hour equal to 1.7 times such
pressly subject to the following sentence),Force Majeure and Commission Charter Customer's Water Allocation divided by 24.Further,the Commis-
Defaults substantially the same as Sections 3,6, 13, 14,and 15 hereof(which sion's obligation to each Charter Customer to deliver Lake Water at a max-
provisions may relate to a Full Water Requirements agreement or a Minimum imum hourly rate shall be divided among the connection points, if more
Take or Pay Requirement agreement as the case may be).The rates or charges than one,of each such Charter Customer as provided in the design of the
for Lake Water may be higher than those provided herein, and coolly the Waterworks System.
terms of payment need be substantially the same.
(b)Certain Limits on Supply 1 and Commission's Power to Contract.
"Trustee"means the trustee provided in the Bond Resolution. The Connnissiou shall use its best efforts to furnish Lake Water to the Charter
Customers as hcreinabove provided,but its obligation hereunder shall be
"Underconsumer"means,for any given year,a Contract Customer which limited by 6)the amount of Lake Water from time to time available to the
takes less Lake Water in such year than its Water Allocation times 365 times Commission;(ii)co iluacts I)clwccn the Commission and its other Customers;
the Underconsumption Ratio for such year. (iii)the capacity of the Waterworks System;and(iv)ordinary transmission
loss,including standard metering error,between the Commission's source
"Underconsumption" means the amount by which the amount of Lake of supply and the points of delivery.'file Commission shall not enter into
Water actually taken by a Contract Customer is less than the Undercon- contracts with other Customers that would cause the Commission to be
sumption Ratio times such customer's Water Allocation times 365. obligated to sell Lake Water in excess of the least of(i)Waterworks System
capacity, (ii) the maximum anxrunt of Lake Water available under the
"Underconsumption Costs"means any amount which the Commission Chicago Water Supply Contract or(iii)an amount which would decrease
is obligated to pay under the Chicago Water Supply Contract solely by reason the amount of Lake Water then being supplied or to be supplied in the future
of failure to accept delivery of the minimum quantity of Lake Water that to the Charter Customers.
the Commission is obligated to purchase under the Chicago Water Supply
Contract. (c)Emergency or Maintenance Shut-Off.The Commission undertakes
to use reasonable care and diligence to provide a constant supply of Lake
"Underconsumption Ratio"means,for any given year,(i)the minimum Water as herein provided for, but reserves the right at any time tempor
amount of Lake Water required to be taken by the Commission under the arily to turn off the Lake Water in its mains for emergency and maintenance
Chicago Contract divided by(ii)the sum of the Water Allocations of all purposes.The Commission shall give to the Charter Customers notice not
Contract Customers times 365. Tess than forty-eight(48)hours in advance of any such turn-off,except that
in emergencies it shall give notice which is reasonable under the particular
"Unit System"means the waterworks system or combined waterworks circumstances.
and sewerage system(if such systems are combined for financing and ac-
counting purposes) from time to time of a Contract Customer. (d) Curtailment; Emergency Use of Other Sources. If it becomes
necessary for the Commission to ►unit its delivery of Lake Water to its
"Water Allocation"means,with respect to a Customer,such Customer's Customers fur any reason,each Charter Customer shall be entitled to the
allocation and allowable excess from time to time of Lake Water pursuant fullest extent possihle to receive during such period of curtailment its pro
to the Level of Lake Michigan Act,as amended from time to time;Illinois rata share of Lake Water available as determined by the ratio of its total
Department of Transportation Administrative Opinion Order Nos. LMO Lake Water use during the prior Fiscal Year to the sum of Lake Water use
80-1,LMO 80-4 and subsequent orders of the State of Illinois Department during the prior Fiscal Year of all Customers entitled to Lake Water dur-
of Transportation;or such other amounts of Lake Water as a Customer may ing such period of curtailment. Nothing in this Contract shall be construed
lawfully lake. to prohibit each Charter Customer from serving its customers in cases of
emergency,or when the Collin lisision for whatever reason is unable to meet
"Waterworks System"means all the Commission's facilities, including such Charter Customer's Full Water Requirements, from any source in-
land, easements, rights-of-way over lands and waters, pumping, storage eluding wells owned by such Charter Customer and maintained for enter-
and other facilities,mains and pipelines acquired and used for the purposes gency use.
of providing and transmitting Lake Water from the City of Chicago's water Water unlit The Commission further undertakes to provide in the
supply system to Customers substantially in accordance with the plans and (e) Quality
project description attached hereto as Exhibit 1. Said Exhibit 1 may be Chicago Supply Contract and similar water supply contracts that all Lake
modified,amended and supplemented from time to time by the Commis- Water delivered to the Commission under said contracts shall be of such
sion in its sole discretion to serve the Lake Water needs of only those quality, at the point of delivery to the Commission under said contracts,
Customers or potential Customers located within the territorial limits of as to meet the requirements of any Federal,State or local agency as shall
the Commission on March 1, 1986,or within territory which by annexa- have jurisdiction from time to time for the operation of public water sup-
tion or consolidation becomes part of municipalities defined as"included plies.The Commission shall supply each Charter Customer with Lake Water
units"in the Act as the Act is written on March 1, 1986,without amend- of a quality commensurate with that furnished other Charter Customers,
ment thereto. and meeting state and federal water quality standards.The Commission bears
no responsibility for the contamination of Lake Water or deterioration of
Section 2. Water Supply. water quality occurring beyond the points of delivery to the Charter
Customers.
(a)Agreement to Purchase and Sell. Subject to the provisions of this y Distribution and Conservation.
Contract,the Commission shall sell to each Charter Customer and each Section 3. Storage, pelivery,
Charter Customer agrees to purchase from the Commission an amount of
Lake Water necessary from time to time to serve its Full Water Requirements. (a)Storage.'Pile Chicago Water Supply Contract currently requires the
The Commission's obligation to each Charter Customer,however,to deliver Commission to provide for and maintain water storage within the Water-
Lake Water hereunder shall be limited to a maximum annual amount works System and certain Customer Unit Systems,collectively,of suffi-
equivalent to such Charter Customer's then current Water Allocation and cient capacity to store not less than two times the annual average daily
3
water demands(including operable shallow well capacity which may be tract,together with such above-ground structures as the Commission shall
counted towards meeting up to 10% of the storage requirements). In the deem necessary to house such equipment and devices.Such meter or meters
event the City of Chicago enforces the minimum water storage standards and other equipment so installed and structures so constructed shall remain
and thereby requires the Commission to provide additional water storage the property of the Commission. Such structures and equipment shall he
er agrees located at sites selected and provided by cacti Charter Customer, respec-
and capacity,then this Section will apply. Each Charter Custom to use its best efforts to increase the water storage capacity of its Unit System; lively, for Lake Water delivered to it, for such purpose. Such sills stud)
but in no event shall a Charter Customer be required to increase the water be subject to review and approval er the Commission, which shat)not be
Commis-
storage capacity contained in its Unit System(including its operable shallow unreasonably withheld.Each Charter Customer shall gaol to the the Com-
well capacity which may be counted towards meeting up to 10%of its storage sion a property interest in each respective site sufficient to enable the Com
requirements)to an amount more than(i)twice the amount of its then an-
mission to install,use,operate and maintain such structures and equipment
nual average daily water demand, less that portion of the Commission's during the tern of this Contract.The Commission and cacti Charter Customer
storage capacity in its Waterworks System equal to such Charter Customer's shall have access to such structures and equipment for examination and in-
demand divided by the total annual average daily spection at all reasonable limes,but the reading for billing purposes,calibra-
annual average daily water
tion and adjustment thercol'shall be done only by the empluyccs or agents
water demands of all Customers(to the extent that such Customers are in- of the Commission. For the purpose of this Contract, the official record
eluded as parties for whom storage must be provided and maintained under of readings of the meter or meters shall be the journal or other record book
the provisions of the Chicago Water Supply Contract)or(ii) an amount of the Commission in its office in which the records of the employees or
of storage(including storage under construction or ordered to be constructed o ehe of the Commission who take the readings are s may be transcribed.
pursuant to this subsection)relative to its annual average daily water de- agents
written request of a Charter Customer,the Commission will give the
mand which is more than any other Contract Customer's storage relative Charter Customer a copy of such journal ,t record book, or permit the
to its annual average daily water demand.
Charter Customer to have access thereto in the office of the Commission
(b)Points of Delivery,Back-Flows,Pressure.The points of delivery during regular business hours.
shall be defined as the points of outlet where the Lake Water delivered
hereunder leaves the Waterworks System and enters a Unit System.These (b)Calibration.At least once in each Fiscal Year,the Commission shall
points will be ten feet downstream from the Commission's metering sta- calibrate its meters measuring Lake Water to a Charter Customer if requested
tions.The number and location of connections to each Charter Customer's in writing by such Charter Customer to do so,in the presence of a represen-
system are shown on Exhibit 1. Each Charter Customer shall receive its tative of the Charter Customer, and the Commission and such Charter
supply of Lake Water downstream of the Commission's metering stations Customer shall jointly observe any adjustments which are made to the meters
at pressures that will vary from time to time.Each point of delivery shall in case any adjustments shall be necessary. and if any check meters as
have a pressure increasing/reducing station. Each Charter Customer is hereinafter provided for have been installed, such meters shall also be
responsible for the siting,design,construction,operation,maintenance and calibrated by the Charter Customer in the presence of a representative of
replacement of the pressure increasing/reducing stations to convey water the Commission and the Commission and such Charter Customer shall jointly
from the Waterworks System into the Unit System.The Commission shall observe an adjustment in case any adjustment is necessary.
pay or reimburse each Charter Customer for reasonable costs of design and
initial construction of such stations;provided,that each Charter Customer (c)Check Meters. A Charter Customer may,at its option and its own
shall provide appropriate sites without reimbursement. expense, install and operate a check meter to check each meter installed
by the Commission,but the measurement of Lake Water for the purpose
Initial construction and future modification of plans and specifications of this Contract shall be solely by the Commission's meters,except in the
of the pressure increasing/reducing stations shall be submitted to the Com-, cases hereinafter specifically provided to the contrary.All such check meters
mission for review and approval,which shall not be unreasonably withheld. shall be of standard make and shall be subject at all reasonable limes to
inspection and examination by any employee ok agent of(tic Commission,
Each Charter Customer's operation of its pressure increasing/reducing but the calibration and adjustment thereof shall be made only by such Charter
stations shall not cause surges or back-flows into the Waterworks System Customer,except during any period when a check meter may be used under
nor shall the operation of the Customer's pressure increasing/reducing the provisions hereunder for measuring the amount of water delivered, in
facilities cause the Waterworks System pressure to drop below 20 psi.The which case the calibration and adjustment thereof shall be made by the Com-
Commission shall not be responsible for any damage to the Unit System mission with like effects as if such check meter or meters had been fur-
caused by design,operation or maintenance of the Customer's connection nished and installed by the Commission.
facilities to the Waterworks System.
(d) Variations between Meters; Reconciliation. Notwithstanding the
(c)Charter Customer to Maintain Water Quality and Unit System and foregoing,if the Commission or any Contract Customer at any time observes
to Prevent Waste.Each Charter Customer agrees to operate its Unit System a variation between a delivery meter and a check meter,if any such check
from the points of delivery on to the consumer in such a manner as at no meter shall have been installed,or any other evidence of meter malfunc-
time to place the Commission and the Waterworks System in jeopardy of tions such party shall promptly notify the other party and the Commission
failing to meet the regulations of any agency or governmental authority having and such Contract Customer shall then cooperate to procure an immediate
jurisdiction for its operation of public water supplies.Each Charter Customer calibration test and adjustment of such meter to accuracy and shall jointly
also agrees to notify the Commission as promptly as possible of all emergency
observe any such adjustment.The party who discovers such variation shalt .�
and other conditions which may directly or indirectly affect the quantity give the other party notice not less than forty-eight(48)hours prior to the
or quality of the Lake Water received hereunder or the Waterworks System. time of all tests of meters(which tests shall be conducted during normal
working hours)so that the other party may conveniently have a represen-
SeCtiOn 4. Measuring Equipment. tative present. If said representative is not present at the time set in such
(a)Commission to Supply Equipment,official Record.The Commis- notice,calibration and adjustment may, notwithstanding any other provi-
sion shall furnish, install,own,operate, maintain, repair and replace, at provi-
sion test,paragraph,rcent gee ofrinaccuracy of any ameterirssfound to If,
e
its own expense,at the points of delivery the necessary equipment and devices Po Y
of a type meeting the standards of the American Waterworks Association in excess of two percent (2%), registration thereof shall be corrected by
for measuring properly the quantity of Lake Water delivered under this Con- agreement of the Commission and such Contract Customer based upon the
4
best data available, for a period extending back to the time when such pay its share of Fixed Costs for each Fiscal Year,which share shall be payable
inaccuracy began,if such time is ascertainable,and if such time is not ascer- monthly and shall be that proportion of Fixed Costs which such Charter
tainable,then for a period extending back one-half(I!2)of the time elapsed Customer's Full Water Requirements for the two preceding calendar years
since the last date of calibration,but in no event further back than a period prior to such Fiscal Year tears to the sum of the Full Water Requirements
of six(6)months. If for any reason any meters are out of service or out or Minimum Take or Pay Requirements, as applicable,of all those Con-
of repair so that the amount of Lake Water delivered cannot be ascertained tract Customers lie such two preceding calendar years, who are not re-
or computed from the reading thereof, the Lake Water delivered during lieved front Fixed Costs payments pursuant to the payment limitation set
the period such meters are out of service or out of repair shall be deemed forth in the last sentence of this subsection.The Commission may require
to be the registration of any check meter or meters if the same have been Subsequent Customers to pay for any month a share of Fixed Costs which
installed and are accurately registering.Otherwise,the amount of Lake Water is greater than said proportion. Such requirement of a greater share may
delivered during such period shall be estimated(i)by correcting the error but need not be applied by the Commission to reduce the shares of said
if the percentage of the error is ascertainable by calibration tests or costs payable in any month by the Charter Customers;provided,however,
mathematical calculations,or(ii)if the error is not ascertainable by calibration that in no event shall the Commission reduce the shares of Charter Customers
tests or mathematical calculation,by estimating the quantity of delivery by by an anunutt which exceeds the amount that is available due to such greater
considering deliveries during preceding periods under similar conditions share being paid by a Subsequent Customer. Prior to the Commission's
when the meter or meters were registering accurately. delivery of Lake Water to any Charter Customer for two calendar years,
each Charter Customer's share of monthly Fixed Costs shall be that por-
(e)Removal of Commission Metering Station.Within 90 days after the tion of Fixed Costs which such Charter Customer's Water Allocation bears
termination of this Contract without renewal,the Commission shall at its to the total Wider Allocations of Contract Customers,who are not relieved
own expense remove metering equipment and stations from and restore the from Fixed Costs payments pursuant to the payment limitation set forth in
property of each Charter Customer to which such termination without renewal the last sentence of this paragraph. Subject to the single limitation on its
applies. If the Commission fails to remove and restore, as aforesaid, the obligation to pay Fixed Costs set forth in this paragraph, each Charter
Charter Customer affected may elect to enforce its right to same or to take Customer's obligation to make all payment of Fixed Costs as required
title to such equipment and station. hereunder is unconditional and irrevocable, payable without setoff or
counterclaim and irrespective of whether Lake Water is ever furnished,made
Section 5. Unit of Measurement. The unit of measurement for available or delivered to any Charter Customer or whether the Waterworks
Lake Water delivered hereunder shall be gallons of water, U.S. Standard System is completed,operable or operating,and notwithstanding suspen-
Liquid Measure,and all measuring devices shall, unless the Commission siun interruption, interference, reduction or curtailment of the supply of
and affected Contract Customer otherwise agree, to be so calibrated. ht Lake Water.The rights of the Charter Customer in the event of the failure
the event that it should become necessary or desirable to use other units by the Commission to perform its obligations under this Contract are gov-
of measurement, the basis of conversion shall be that 7.48 gallons is creed by Section 14. Each Chatter Customer's obligation to pay Fixed Costs
equivalent to one (1)cubic foot. hereunder is subject to the single limitation that, if for any period of time
(and only during such period)the Commission is in fact supplying the Full
Section 6. Prices and Terms of Payment. Witter Rcq„irco,cnts or Mininunu Take or Pay Requirements,as applicable,
of Contract Cusluntcrs other than such Charter Customer,whose Full Water
(a)Operation and Maintenance Costs;Underconsumption Costs.Each Requirements and Mininwm'I'ake or Pay Rcyuirements are more than 85%Charter Customer shall pay a share of Operation and Maintenance Costs of the sum uC the Full Water Requirements or Minimum Take or Pay Re-
for each month, which shall be an amount equal to the Then current price epuircments,as applicable,of all Contract Customers,and during such period
Re-
per 100(1 gallons for Operation and Maintenance Costs times the quantity cut.time the C'onunission is unable to supply any Lake Water to such Charter
of Lake Wider divided by 1000 delivered by the Waterworks System to Custontcr,then such Charter Customer shall have no obligation to pay Fixed
such Charter Custontcr lie such month. At any time no bake Water is Ile- Costs tie such period.
ing supplied through the Waterworks System to Contract Customers,each
Contract Customer's share of monthly Operation and Maintenance Costs (c) Bills and Due Date. The Commission shall notify each Charter
shall be that proportion of those costs which such Contract Customer's Water Customer of such Charter Customer's share of Aggregate Costs for a month
Allocation bears to the total Water Allocations of all Contract Customers on or before the 10th day of the following month.The Charter Customer's
required to make Operation and Maintenance Costs payments during the share of Aggregate Costs for a month shall be due and payable and must
same period.The Commission may require Subsequent Customers to pay be received at the offices of the Commission on or before the tenth day
for any month a share of Operation and Maintenance Costs which share of the month timllowing the month of the Commission's notification or, if
is based upon a rate or proportion higher than that which is applicable to later, within 28 clays of the date of notification.
Charter Customers.Such requirement of a greater share may but need not
be applied by the Commission to reduce the shares of said costs payable (d)Default Shares.If any Customer shall default in the payment to the
in any month by the Charter Customers;provided,however,that in no event
Commission of any part of its share of Aggregate Costs, or any part of
shall the Commission reduce the shares of Charter Customers by an amount the payment of its share due pursuant to this subsection 6(d),each Charter
which exceeds the amount that is available due to such greater share being Customer agrees to pay a share of the amount so in default to the Commis-
paid by a Subsequent Customer. lion,which share shall be in the same proportion as such Charter Customer's
mption Costs as share of the Aggregate Costs for the month prior to the month of the default
Each Underconsumer shall pay its share of Underconsu
m
determined and assessed by the Commission after notification of such costs bears Um the su of the shares of Aggregate Costs in that month of all Con-
by the City of Chicago. Each Underconsumer's shore of Underconsump tract Customers obligated to make payments under this subsection 6(d)not
in default. A Charter Customer's share of defaulted Aggregate Costs,or
tion Costs for a year shall be equal to the ratio of its Underconsutnptio❑ such defaulted payment of shares, as the case may be, shall be due and
to the aggregate Underconsumption of all Underconsunmers for such year. payable twenty-one (21) clays after the Commission's written demand
(b)Fixed Costs.Subject to the single limitation on its obligation to pay therefor. 'file demand shall include the Commission's calculations of the
Fixed Costs set forth in this subsection,each Charter Customer agrees to auuxutt clue by the Charter Customer hereunder.If and when the defaulting
5
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EXHIBIT I
COMMISSION �
SYSTEM MAP
l
)IS
LEGEND
O COMMISSIONS STORAGE FACILITIES i
CHICAGO'S PRESENT CENTRAL I!
PARK PUMPING STATION
/j Yr IV DIAMETER TUNNEL
STATION
RESERVOIR AND PUMPING
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. FACILITY
'�.. DIRECT CONNECTION TO PRESENT
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RECEIVING STANDPIPE STORAGE
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ENGINEERS CHICAGO
SEPTEMBER I, 1986
7
Customer makes a payment to the Commission of a defaulted amount or or at such time that the Commission may in its sole discretion determine,
interest thereon for which the Charter Customers have made a payment to any security deposit shall be returned to the Charter Customer if the Charter
the Commission under this paragraph, the Commission will pay to each Customer has performed all its obligations under this Contract.
Charter Customer its proportionate share of such amount, including any (h)Rates to Charter Custnmmers Same.No change in the rates or charges
such interest.
under this Contract for any Charter Customer may be made unless the same
(e)Disputed Payments.If a Charter Customer desires to dispute all or change is made for all Charter Customers.
any part of any payments under this Agreement,the Charter Customer shall
nevertheless pay the full amount of any such payment when due and in (i)Limitation on Payments;Net Indebtedness of Charter Customers.
elude with such payment written notification to the Commission that charges Notwithstanding any other provisions of this Contract to the contrary,the
are disputed, the grounds for dispute and the amount in dispute. payments required to be made by each Charter Customer under this Con-
tract shall be required to be made solely from revenues to be derived by
Upon receipt of notification of dispute,representatives of the Commis- such Charter Customer from the operation of its t)nit System. This('on-
sion shall meet with representatives of the Charter Customer to resolve such tract shall not constitute an indebtedness of any Charter Costomcr within
dispute. No adjustment or relief on account of any disputed charges shall the meaning of any statutory or constitutional limitation.
he made unless disputed charges are the subject of such notice within the
time herein specified,or within a reasonable period from the time the Charter 0)May Use Other Moneys.Notwithstanding the provisions of Subsec-
Customer knew or should have known of the facts giving rise to the dispute. tion(i)of this Section, the Charter Customers are not prohibited by this
The Commission and the Charter Customer shall promptly attempt and Contract from using other available funds to make the payments required
continue efforts to resolve the dispute. In the event that it is determined
by this Contract.
that the Charter Customer shall have overpaid,it shall receive a refund with (k)Sole Method for Charter Customers to Enforce Provisions Hereof
interest at the rate set out in subsection (f). Against Other Customers. Each Charter Customer acknowledges that its
(f)Interest on Overdue Payments. If a Charter Customer shall fail to obligations to make payments hereunder are of benefit to each other Charter
make any payment required under this Contract on or before its due date, Customer and to Subsequent Customers as such other Customers'obliga-
such Charter Customer shall be in default,and interest on the amount of tions are of benefit to the Charter Customer. Accordingly, each Charter
such payment shall accrue during the period of non-payment at the max- Customer agrees that,in addition to the Commission,Bondholders,a Trustee
imum legal rate payable by an Illinois non-home rule unit, not to exceed or other parties by law entitled to enforce the provisions of this Contract,
the higher of the weighted average effective interest rate on all series of any three or more Contract Customers acting together may enforce the pro-
Bonds of the Commission any of which are then outstanding plus two per- visions of this Section,but only if the Commission has not acted to enforce
cent (2%)or the prime rate from time to time announced by the largest such provisions within 90 days of failure to make a payment hereunder.
commercial bank,measured in terms of total assets,located and doing bank- Any rights any Contract Customer has under this Contract or other con-
ing business in the State of Illinois,plus five percent(5%),from the date tracts with the Commission shall be limited in enforcement as set forth herein.
such payment becomes due until paid in full with interest as herein specified. I Beginning of Obligation to Pa The obligation tion to make any and all
In the event such payment is not made within thirty(30)days from the date () g g g b b'
such payment becomes due, the Commission may at its option and in its payments under this Contract shall begin the month aticr any Bonds are
discretion reduce or discontinue delivery of Lake Water to the Charter issued.
Customer until the amount due the Commission is paid in full with interest
as herein specified. The Commission shall give notice to the Charter (in)Provision In Lieu of Water Allocation.At any time when no Water
Customer not less than twenty(20)days prior to the event of its intention Allocation is in effect for a Customer and relcrcnce to a Water Allocation
to reduce or discontinue delivery of Lake Water in accordance with this is necessary to give meaning to it Term of this('onnact,the Water Alloca-
subsection(f)and shall provide the Charter Customer an opportunity for tion for such Customer shall he deemed to be as follows:
a hearing prior to any reduction or discontinuance.If the Commission reduces (i)prior to May 1, 1988, the MGD value set out for such Customer in
or discontinues the delivery of Lake Water under such circumstances,the Section 24 hereof, if applicable,or in the applicable Subsequent Contract
Charter Customer shall,nevertheless,continue to be liable to pay all charges for a Subsequent Customer and
herein provided for.The rights specified in this subsection shall be in addi-
tion to all other rights and remedies available to the Commission at law (ii)on or after May 1, 1988,such Customer's Full Water Requirements
or in equity for breach of any of the provisions of this Contract.
for the then most recently completed calendar year divided by 365.
(g)Security Deposit.If a Charter Customer is in default in any payment
Section 7. Procedural and Other Limitations; Further due under this Contract and the default is not cured within thirty(30)days
Covenants Of the Commission. Notwithstanding any other provi-
after the due date of the defaulted payment, the Commission may, at its
option,require such Charter Customer,as a further obligation under this sions of this Contract,the Charter Customers shall have the rights enumerated
ission in its activities shall he obligated
Contract,to deposit as security for the payment of such Charter Customer's within this section and the Comm
obligations hereunder a reasonable amount determined by the Commission. in the manner provided in this section.
The Charter Customer's compliance with the Commission's demand fora a procedural Rule.No motion,resolution or ordinance concerning the
security deposit shall be a condition precedent to the curing of such Charter ( )
subjects enumerated below shall be adopted by the Commission except by
Customer's default,and the restoration of the Lake Water service to such
Charter Customer,if abated or reduced by reason of such default.The secur- at least a majority affirmative vote of all of the Commissioners which ma-
ity deposit or any part thereof may,at the Commission's discretion,be ap- jority must contain the votes of at least one-third(1/3)of the Commissioners
plied to any subsequent default by the Charter Customer in any payments appointed by the County Board Chairman and 40%u of the Commissioners
due hereunder.If so applied,the Charter Customer shall provide funds inr appointed by the Mayors as provided in the Act.(1)Approval of individual
mediately to restore the security deposit to the amount required by the Corn- contracts or a series of contracts related to a single Project in an amount
mission. At the earliest of the end of the term of this Contract,a term of in excess of$100,000. (2)Setting of rates for the sale of Lake Water to
two years after the curing of the most recent default by the Charter Customer, Charter Customers.(3)Borrowing funds. (4)Exercise of eminent domain
8
powers. (5)Employment of managerial and professional personnel either (g)Governance. For the term of this Contract,the number of Commis-
as employees or consultants.(6)Amendment of the Chicago Water Supply sioners appointed by the Mayors as provided in the Act shall be not less
Contract. than one-half the total number of Commissioners(excluding,expressly,for
purposes of said count, the Chairman).
(b) Lake Water Only. Without the prior approval of the corporate
authorities of any Charter Customer affected, the Commission shall not (It)Retail Sales.The Commission shall not engage in the retail sale or
deliver any water to a Charter Customer other than Lake Water.Costs for distribution of water to residents or customers of any Charter Customer.
Lake Water charged by the Commission shall only include Aggregate Costs
relating to the purchase and delivery of Lake Water. (i)Evidence of Customer Action. Wherever in this Contract the con-
(c)Taxes.To the fullest extent it may lawfully do so,the Commission sent or authorization of a Charter Customer or a group of Charter Customers
covenants to do as follows. It shall annually appropriate and impose its cor- are required,that consent may only be evidenced by a resolution or motion
poxate sales taxes,or any taxes permitted which are a substitution for sales passel by the Col poiaie authorities of file Charter Customer.
taxes, in the maximum amounts authorized by law. In the event that any
Charter Customer(i)is not supplied by the Commission an amount of water (j)limitation on Funds. No funds received by the Commission from
equal to its Water Allocation times 365 times the Underconsumption Ratio Operation and Maintenance Costs or Fixed Costs payable from Charter
for a given year but nevertheless pays a share of Underconsumption Costs Customers may be expended for the planning,construction,operations or
for such year, (ii) is entitled to a Rebate as hereinafter defined and pro- maintenance of a waterworks system other than the Waterworks System
vided for or(iii) pays Operation and Maintenance Costs or Fixed Costs specified within this Contract.
in the case of abandonment of the Waterworks System, the Commission
shall apply such sums of money as it receives from the proceeds of such (k)General Obligation Bonds.The Commission shall not issue any Bonds
taxes(x)to repay to Charter Customers the amount paid by each,respec- until or unless they shall have issued general obligation bonds for the Water-
tively, for Underconsumption Costs as set forth in clause (i), (y) to pay works System in an amount of at least$100,000,000.Such general obliga-
the Rebate as set forth in clause(ii)and(z)to repay to Charter Customers tion bonds and Bonds may be issued simultaneously.
the amount paid by each,respectively,for Operation and Maintenance Costs
and Fixed Costs as set forth in clause(iii). If the Commission cannot pay (1)Certain Budget, Rate Limitation,Notice and Hearing Provisions.
all of said amounts, it shall make payment thereon pro rata. Not less than 60 days prior to the beginning of each Fiscal Year,the Com-
(d)Covenants to Be Set Out in Bond Ordinance. Any Bond Resolu- mission shall prepare and send to the Charter Customers a tentative budget.
tion passed by the Commission shall contain language to the following effect: Each such budget shall include, among such other items as the Commis-
sion may choose,an estimate of Fixed Costs to be payable by each Charter
Any holder or registered owner of a bond or any of its coupons, Customer in a stated aggregate dollar amount per month for each and an
in any civil action, mandamus, or other proceeding, may enforce estimate of Operations and Maintenance Costs in a stated price per 1000
and compel performance of all duties required by law to be per- gallons.The Commission will hold a hearing on such budget,at which the
formed by the Commission or by any customers of the Commis- Charter Customers may be heard, and shall give the Charter Customers
sion, including the making of rates and charges, the collecting of not less than 21 days notice of such hearing. Operations and Maintenance
sufficient revenue and the application thereof,as provided by ap- Costs payable in each Fiscal Year shall be determined and assessed by the
plicable law,and including,expressly,all of the terms and provi- Commission on a price per l(X)0 gallons basis;such price may not exceed
sions of Sections 6, 7 and 16 of the Contract preferring to this the estimate as set forth in the tentative budget unless the Commission shall
Conlracti. hold a hearing on such higher price,at which the Charter Customers may
be heard,and shall give the Charter Cusioniers not less than 21 days notice
The parties or persons which make loans of funds to the Commis- of such hearing.
sion 1by this Bond Resolution)have received the pledge of the State
of Illinois that it will not impair or limit the power or ability of the (m)Use of Sales Taxes to Rebate Charges In Limited Circumstances.
Commission or a unit of local government fully to carry out the terms To the fullest extent it may lawfully do so,the Commission agrees to rebate
of any contract for the supply of water entered into by the Commis- solely from the corporate sales taxes of the Commission,or any taxes per-
sion and a unit of local government for the term of such contract. mitted which are a substitution for sales taxes, within a reasonable time,
For purposes of such impairment or limitation,the contracts for the payments of Aggregate Costs made by Charter Customers under this Con-
supply of water executed by units of local government and the Com- tract upon the conditions as follows:
mission contain terms and conditions intended by the parties thereto
and by the Bondholders to be absolute conditions thereof. (i)This provision applies only upon initial construction of the Waterworks
(e)Absolute Conditions. For purposes of the pledge and agreement of
System.
the State of Illinois that it will not impair or limit the power or ability of (ii)The60%Completion Date"is defined as the date during initial con-
the Commission or the Charter Customers fully to carry out the terms and struction upon which the Waterworks System is serving or able to serve
conditions hereof,all terms and conditions contained herein are intended
to be absolute conditions hereof and are agreed to by the parties.It is hereby the Full Water Requirements of Charter Customers the sum of whose Water
intended that no change in the Act or other law or regulation subsequent Allocations equals or exceeds sixty percent(60%)of the sum of the Water
Allocations of all Charter Customers.
to the date hereof shall affect any of the terms or provisions of this Con-
tract,and neither the Charter Customers nor the Commission,without the
(iii)This provision applies only to those Charter Customers(the"Rebate
unanimous consent of all of them, shall take any actions under a change
Recipients")which are not being served System ha able to served with any Lake
in the Act or other law or regulation contrary to the terms and conditions Water by reason of the Waterworks System not having been sufficiently
herein:
completed one year after the 60% Completion Date.
(f)Emergency Supply.A Charter Customer may contract for a temporary
supply of water in case of an emergency from any other unit of local govern- (iv)The Commission shall rebate from such sales taxes,or any taxes per-
milted which are a substitution for sales taxes, to each Rebate Recipient
uient or any entity.
q
the amount paid(the"Rebate")by such Rebate Recipient to the Commis- part by a pledge of such Unit System revenues. Each Charter Customer
sion pursuant to this Contract during the period beginning one year after shall make all budgetary,emergency and other provisions and appropria-
the 60%Completion Date to the date upon which the Waterworks System tions necessary to provide for and authorize the prompt payment by such
can deliver Lake Water to such Rebate Recipient. Charter Customer to the Commission of its shares of Aggregate Costs.The
obligations of each Charter Customer under this Contract are further payable
(v)The Commission agrees,to the fullest extent it may lawfully do so, from all other accounts of the Unit System of each Charter Customer,respec-
annually to appropriate such amount of such sales taxes,or any taxes per- lively, for its shares, in which there are lawfully available funds. In any
mitted which are a substitution for sales taxes,as may be necessary to meet revenue bond ordinances or resolutions hereafter enacted by a Charter
its obligation to pay the Rebates to the Rebate Recipients; provided, the Customer, the priority of lien established pursuant to this Contract shall
Commission shall not be required to pay any Rebates until it has had suffi- be expressly provided and set forth in said bond ordinances or resolutions.
cient time to take such budget and appropriations measures as are necessary if legal action is brought against a Charter Customer challenging the priority
under law. ol'such Charter Customer's obligations hereunder over the lien of any revenue
bonds supported by a pledge of the revenues of its unit System,the('om-
(vi)The Rebate Recipients are not relieved of any obligation under this mission shall,if requested to do so by such Charter Customer, undertake
Contract by the terms of this subsection but become entitled to'payntent the defense of the legal action at the Commission's expense.
of Rebates from the taxes as are herein described.The Charter Customers
acknowledge that such funds are limited in amount.The Rebate Recipients (e)Commission Insurance.The Commission will carry insurance or main-
shall have no recourse against any revenues of the Waterworks System. tain self-insurance with respect to the Waterworks System of the kinds and
No interest shall be paid on any Rebate amount. in the amounts which are customarily carried or maintained by parties
operating similar properties, including,without limiting the generality of
Section 8. Special Conditions and Covenants. the foregoing,fire and other casualty and public liability insurance or pro-
tection. All moneys received for loss under the insurance policies or on
(a)Commission to Build Waterworks System and Supply Lake Water. deposit as self-insurance reserve funds shall be used in making good the
The Commission shall proceed promptly with the construction of the Water- loss or damage in respect of which they were paid except to the extent no
works System necessary to the performance of its obligations hereunder. longer deemed useful to or profitable in the operation of the Waterworks
The Commission will make a diligent effort to have its facilities completed System,whether by repairing the property damaged or replacing the pro-
to the point of delivery so as to famish Lake Water to the Charter Customers perty destroyed, and provision for making good such loss or damage or
by January 31, 1992,but the Commission does not hereby guarantee delivery replacing the property destroyed shall be made within a reasonable time
by such date.The Commission shall not be liable to any Charter Customer from date of loss.The proceeds derived from any and all policies or available
for any damages occasioned by delay in the commencement of such ser- from self-insurance reserves for public liability losses shall be used in pay-
vice to any Charter Customer, and all payments provided for under this ing or reimbursing any accounts from which payments for settlements,
Contract remain due and payable in accordance with its terms notwithstand- judgments or expenses were advanced.
ing any such delay. After Lake Water is first tendered for delivery to a
Charter Customer at any point of delivery,the Commission shall,subject (f)Commission to Continue to Serve.The Commission will use its best
to the other terms and conditions of this Contract,continually hold itself efforts to continue serving all the Charter Customers.
ready,willing and able to supply Lake Water to such Charter Customer.
The Commission shall also use its best efforts,consistent with its legal obliga- (g)Commission Covenant to Operate Properly.From time to time,the
tions to its other Customers and consistent with fair and equitable treat- Commission will take steps reasonably necessary so that the Waterworks
ment of all of its Customers,to supply each Charter Customer with such System may at all times he operted properly and advantageously.
additional amounts of Lake Water as may be from time to time allocated
to such Charter Customer over and above its present Water Allocation,but Section 9. Additional Charter Customer Covenants. Each
the Commission does not hereby guarantee a supply of such additional Charter Customer further covenants as follows:
amounts.
(a)Maintain and Operate Unit System. It will own and maintain its
(b)Title to Lake Water.Title to all Lake Water supplied hereunder shall Unit System,and all improvements and extensions of its Unit System, in
remain in the Commission to the points ten feet downstream from the Com- good repair and working order,will operate the same efficiently,and will
mission's metering stations for each Unit System and thereupon shall pass punctually perform all duties with respect to its Unit System as may be ve-
to such Charter Customer. quired by the Constitution and laws of the State of Illinois and all other
applicable laws and by all resolutions and ordinances of such Charter
(c)Commission to Use Best Efforts to Build and Finance Construe- Customer.
tion.The Commission shall use its best efforts to obtain the necessary per-
mits and contracts for labor and material,and to borrow funds and issue ( Rate Covenant. It will establish,maintain, revise as necessary and
its Bonds therefor in order to acquire and construct the Waterworks System. collect,rates and charges for customers of its Unit System as shall be re-
quired from time to time to produce revenues at least sufficient(i)to pay
(d)Payments Hereunder an Operation Expense of Unit Systems.Ob- all amounts due under this Contract and to pay all other costs of operation
taining water is an essential item of expense of the Unit Systems.To the and maintenance of its Unit System,(ii)to provide an adequate deprecia-
fullest extent permitted by paw or contract,all of the payments to be made tion fund for its Unit System,(iii)to make all deposits in all funds and ac
by each Charter Customer hereunder shall constitute operating expenses counts required by the terms of resolutions or ordinances authorizing bonds
of the Unit Systems as to any and all revenue bonds of such Charter Customer payable from revenues of its Unit System and(iv)to pay the principal of
which are supported in whole or in part by a pledge of the revenues of its and interest on all bonds of such Charter Customer payable from the revenues
Unit System,with the effect that such Charter Customer's obligation to make of its Unit System.The Commission may not sue to enforce the provisions
payments from its water revenues under this Contract has priority over its of this Section as they relate to clauses(ii)through(iv)unless it can show
obligation to make payments of the principal of and premium,if any,and that the ability of the Charter Customer to make the payments set forth in
interest on any such bonds which are or will be supported in whole or in clause(i)is substantially impaired by the inadequacy of said rates and charges.
10
The rates and charges for customers of a Unit System shall not be required, accordance with applicable state laws,provide lawful authority for payment
however,to be sufficient to produce amounts required to make payments of all sums anticipated to be due to the Commission during such fiscal year.
under this Contract so long as available amounts sufficient for making such
payments for the next six (6) months or the remainder of such Charter (i)Continue to Serve. It will use its best efforts to continue serving all
Customer's fiscal year, whichever is longer, shall have been set aside in customers of its Unit System within its territorial limits which are served
cash or investments in a separate account in its Unit System Fund designated as of the (lade of this Contract.
for the purpose of making payments under this Contract.
(k)Maintain Water Allocation. It will use its best efforts to obtain or
(c)Segregate Revenues.It shall provide for the segregation of all revenues retain, from time to time, a Water Allocation at least equal to but not in
of its Unit System in such Unit System Fund and provide for the applica- excess of two times its Full Water Requirements from time to time.
tion of the revenues for the purpose of subsection(b)of this Section.Moneys
of a Unit System of a Charter Customer which exceed the obligations of (1)Combining or Separating Unit System Accounts. It shall not cony
such Charter Customer hereunder may be used for any lawful corporate hint its existing separate waterworks system with its separate sewerage
purposes. system or separate its existing combined waterworks and sewerage system
into separate systems before May 1, 1990.Thereafter,it may combine its
(d)Future Subordination of Revenue Bond Lien.Any resolution or or- waterworks system with its sewerage system or separate its combined water-
dinance of the Charter Customer which authorizes the issuance after the works system and sewerage system into separate systems only on the con-
date of this Contract of any obligation of the Charter Customer to be paid ditions as follows:(i)the Charter Customer shall provide the Commission
from revenues of its Unit System will expressly provide that revenues of with written evidence that the proposed combination or separation will not
its Unit System may be used to pay principal of and premium,if any,and materially and adversely affect the Charter Customer's ability to comply
interest on those obligations only to the extent that those revenues exceed with all of the terms, conditions and covenants of this Contract; and(ii)
the amounts required to pay the operation and maintenance expenses of its if the Commission shall then determine the proposed combination or separa-
Unit System including,expressly, all amounts payable from time to time tion will not materially and adversely affect the Charter Customer's ability
under this Contract. to comply with all of the terms,conditions and covenants of this Contract,
then and only then the Commission shall approve such combination or separa-
(e)General Covenant to Operate Properly. From time to time, it will lion and advise such Charter Customer in writing.
take steps reasonably necessary so that its Unit System may at all times
be operated properly and advantageously. (m) Customer Covenants as to Rate of Withdrawal. Each Charter
Customer will take Lake Water at the most uniform and continuous rate
(f)Accounting and Audit.It will make and keep proper books and ac- of withdrawal practicable.
counts(separate and apart from all other records and accounts of such Charter
Customer)in which complete entries shall be made of all transactions relating Section 10. laection as to Water Purchase Requirements.
to its Unit System,and,within two hundred ten(210)days following the When and if the Commission pays in full all of its Bonds, any Charter
close of each fiscal year of such Charter Customer,it will cause the books Customer may elect to thereafter purchase from time to time less than its
and accounts of its Unit System to be audited annually by independent cer- Full Water Requirements from the Commission. In the event such Charter
tified public accountants, showing the receipts and disbursements on ac- Customer elects to purchase less than its Full Water Requirements in any
count of its Unit System. year pursuant to this Section,it shall pay a share of Underconsumption Costs,
if any, incurred fix such year and such Charter Customer's share of such
(g)Maintain Ownership of Unit System and Properties. 11 will con- IIuderconsunption Costs shall be decnted Io be Operation and Maintenance
tinue to own and possess its Unit System and will, within the exercise of Costs under this Contract. Such Charter Customer's share of Undercon-
reasonable business judgment and in a manner so as not to cause a default suntption Costs, if any, for the year shall be that proportion of those costs
hereunder,dispose of property which is part of its Unit System only to the which the Underconsumption of such Charter Customer for that year was
extent that such property is no longer useful or profitable in the operations to the sum of the Underconsumption of all Customers for such year.
of its Unit System.
Section 11. Abandonment. Upon obtaining the consent of not less
(h)Insurance. It will carry insurance or maintain self-insurance with than(i)two-thirds of all Charter Customers,(ii)a majority of those Charter
respect to its Unit System of the kinds and in the amounts which are Customers which would receive less than one-half of their Full Water Re-
customarily carried or maintained by parties operating similar properties, quirements due to the termination hereinafter referred to and(iii)a major-
including,without limiting the generality of the foregoing, fire and other ity of those Charter Customers which would receive no Lake Water due
casualty and public liability insurance or protection.All moneys received to such termination,the Commission may elect to terminate acquisition and
for loss under the insurance policies or on deposit as self-insurance reserves constriction of apt or any part of its Waterworks System prior to its substantial
shall be used in making good the loss or damage in respect of which they completion. All of the following must occur before such termination.
were paid except to the extent that the property damaged or lost would be
permitted to be disposed of under subsection(g)of this Section,whether (a)The Commission shall have found that the cost of substantial comple-
by repairing the property damaged or replacing the property destroyed,and tion of the Waterworks System would so greatly exceed original estimates
provision for making good such loss or damage or replacing the property of that cost that it would not be economically feasible for the Contract
destroyed shall be made within a reasonable time from date of loss. The Customers together to pay the Fixed Costs which would be payable after
proceeds derived from any and all policies or available from self-insurance substantial completion.
reserves for public liability losses shall be used in paying or reimbursing
any accounts from which payments for settlements,judgments or expenses (b)The Commission and each Charter.Customer shall have been pro-
were advanced. vided with a certificate from an independent consulting engineer and a cer-
tificate from an independent financial consultant to the effect that they each
(i)Budget and Appropriations.It will adopt a budget or appropriations concur with the finding of the Commission described in subsection(a)of
ordinance for each fiscal year of such Charter Customer,or otherwise in this Section.
II
(c) The Charter Customers and any Trustee appointed under a Bond said meeting shall be empowered to select such individuals or firms. The
Resolution of the Commission shall have been given ninety(90)days'notice Commission shall keep the minutes of the meeting.
of the proposed termination of acquisition and construction of all or any
part of the Waterworks System. If the Charter Customers do not act at said meeting or within 21 days
thereof,the Commission shalt proceed to select such persons or firms itself.
(d)The Commission shall have caused to be prepared a cooperative study If the Commission shall impose the recommended differential,then the
by an attorney or firm of attorneys having nationally recognized expertise differential as imposed shall not be subject to any dispute or claim by any
in municipal finance,an independent consulting engineer,and an indepen- Contract Customer.This provision shall not require the Commission to billow
dent financial consultant as to the proper,advantageous and equitable opera- such recommendations.
tion and disposition of the assets of the Waterworks System.
This entire subsection is qualified by the Commission's legal duty to serve
If the Commission terminates acquisition and construction of all or any within its territorial limits and to charge for such service fair and equitable
part of the Waterworks System pursuant to this Section,the obligations of rates which are not prohibitive.It is the intent of the Commission in enter-
each Charter Customer to make the payments required for Aggregate Costs ing into this provision of the Contract to recognize that the Charter
under Section 6 of this Contract or required under subsection 6(d)of this Customers,solely,enable the Commission to proceed to construct the Water-
Contract shall continue. works System,that the units of local government hereinafter referred to
need to be induced to become Charter Customers and that this provision
Section 12. Subsequent and Other Contracts. is an express inducement, that by its essential design in accordance with
good engineering practice,the Waterworks System must be built in many
(a)No Contract with Rate More Favorable.The Commission shall not ways sufficient upon initial completion to serve all of said units,but that
supply Lake Water except pursuant to a written contract. No Subsequent only those who become Charter Customers will pay for such from the start
Contract shall provide rates,charges or terms lower or more favorable to of construction.
the Subsequent Customer than those provided in this Contract for Charter
Customers. Section 13. Force MaJetlre. In case by reason of force majeure
any party hereto shall be rendered unable wholly or in part to carry out
(b)Occasional Service Only Except to Contract Customers.The Con- its obligation under this Contract, then if such party shall give notice and
mission shall not contract for a supply of Lake Water to any person except full particulars of such force majeure in writing to the other parties within
to a Subsequent Customer or for occasional water use,being use for not a reasonable time after occurrence of the event or cause relied on,the obliga-
tion of the party giving such notice, so far as it is affected by such force
majeure shall be suspended during the continuance of the inability then
claimed, but for no longer period, and any such party shall endeavor to
(c)Subsequent Contract Terms.The Commission shall not enter into remove or overcome such inability with all reasonable dispatch. The teen
a Subsequent Contract with any of the units of local government named "force majeure"as employed herein shall mean acts of God,strikes,lockouts
in Section 24 hereof unless such Subsequent Contract provides for an or other industrial disturbances,acts of public enemy,orders of any kind
equitable and lawful differential rate or charge in the formula for Aggregate of the Government of the United States,of the State of Illinois,or of any
Costs which may take into account any pertinent factor and shall take into civil or military authority,insurrections,riots,epidemics,landslides,light-
account each of the factors as follows: (i)the utility rate which would be ning,earthquakes, fires, hurricanes, storms, floods, washouts,droughts,
chargeable by a regulated utility for the proposed service,(ii)replacement arrests,restraints of government and people,civil disturbances,explosions,
cost of the Waterworks System less depreciation and net outstanding Bonds, breakage or accidents to machinery, pipelines,canals,or uuurels, partial
and(iii)the amount and time of payment of Fixed Costs which would have or entire failure of water supply,and inability on the part of the Commis-
been payable by the proposed Customer had such Customer become a Charter siou to deliver Lake Water hercundcr,or of ally Choler Customer to Wccive
Customer,plus interest on such costs from the time when they would have Lake Water hereunder,oil account of any odtcr causes not reasonably within
been paid, compounded semiannually, at not less than 10% per annmo. (lie control of the party claiming such inability. 'file settlement of strikes
and lockouts shall be entirely within the discretion of the party having the
The differential may be satisfied by a lump sum payment or by surcharge difficulty and that the above requirement that any"Force Majeure"shall
for any term of years not longer than the then remaining term of this Con- be remedied with all reasonable dispatch shall not require the settlement
of strikes and lockouts by acceding to the demands of the opposing party
tract. The differential shall inure to the benefit of the previous Contract or parties when such settlement is unfavorable to it in the judgment of the
Customers as their interests may appear(that is,those that have borne greater party having the difficulty.No force majeure which renders any of the par-
costs shall benefit proportionally greater)in such reasonable manner as the ties unable to perform under this Contract shall relieve a Charter Customer
Commission may determine. of its obligation to make payments to the Commission as required under
Section 6.
The differential and the allocation of the benefit so derived among prior
Contract Customers shall be made by the Commission only after it has re- Section 14. Commission Defaults. Failure by the Commission
ceived and reviewed the recommendations of an independent consulting to deliver Lake Water to any Charter Customer as required by this Con-
engineer,independent financial consultant and competent attorney,work- tract or failure of the Commission to perform any other obligation under
ing together,who shall be selected by the Commission from a list of three this Contract and the continuation of that failure to perform for thirty(30)
individuals or firms for each position by the Charter Customers. days after written notice from such Charter Customer to the Commission
of such failure shall be a default of the Commission under this Contract,
For the purpose of making such list of three individuals or firms,the Com- unless any such failure is excused pursuant to Section 13 of this Contract.
mission shall call a meeting of the Charter Customers by giving notice to If the Commission defaults under this Contract, the Charter Customer or
the Charter Customers as provided in this Contract not less than 30 days Charter Customers affected may bring any action against the Commission,
prior to a proposed meeting date.The Commission shall convene the meeting, including an action for money damages or in equity and actions for man-
but thereupon the Charter Customers shall elect a presiding officer from damus and specific performance of the Commission's obligations to the ex-
among their number. Such meeting may be adjourned from time to time tent allowed by law. Election of any remedy shall not be it waiver of any
without notice. The majority of Charter Customers present and voting at other remedy.
12
I
Section 15. Charter Customer's Obligation Uncondi- as may be provided in the Bond Resolution.The Charter Customers will,
tional. The Charter Customers shall have no right to terminate,cancel upon notice of assignment to any such Trustee,make all payments directly
or rescind this Contract,no right to withhold from the Commission or the to such Trustee. The rights of the Commission to enforce the provisions
Trustee who is an assignee of the Commission pursuant to Section 17 of of this Contract may be assigned to such Trustee and, in such event, the
this Contract payments due or to become due under this Contract,no right Trustee will have the right to enforce this Contract at law or in equity with
to recover from the Commission or such Trustee amounts previously paid or without the further consent or participation of the Commission.The Com-
under this Contract unless paid in error or contrary to the provisions of mission may also retain the right to enforce this Contract.
this Contract or law,no right of reduction or set-off against the amounts
Section 18. Cooperation In Construction of Commission
due or to become due under this Contract,to the Commission or such Trustee, p
Water Supply. The Charter Customers shall cooperate with the Com-
and no lien on any amounts in any fund established by the Commission or
mission in the construction and acquisition of the Waterworks System.Each
such Trustee for any reason or on account of the existence or occurrence
of any event,condition or contingency,whether foreseen or unforeseen or Charter Customer shall grant without charge to the Commission any
foreseeable or unforeseeable by the Charter Customers or the Commission reasonably required construction casements and any easements necessary
or any other person;including by way of illustration and not limitation by for portions of the Waterworks System to be located on such Charter
reason of the fact that the Waterworks System in whole or in part is not Customer's property,provided the Commission agrees to restore the ease-
completed, operable or operating; the output of the Waterworks System ment property in a reasonable manner after construction. Each Charter
in whole or in part is suspended, interrupted, interfered with,reduced or Customer shall grant the Commission access to its property to the extent
curtailed; any party to the Chicago Water Supply Contract, including the reasonably necessary to construct and install the points of delivery and the
City of Chicago,does not perform in whole or in part thereunder;the Water appurtenant devices.
Allocation of any Customer is modified or terminated or any Customer does
not perform in whole or in part under this Contract or any other agreement Section 1 C rter Cu Mutual Cooperation in Issuance of Obliga-
or instrument; it being the intent hereof that the Charter Customers shall t10I1S. Each Charter Customer shall cooperate with the Commission in
the issuance of the Bonds,and the Commission shall cooperate with each
be absolutely and unconditionally obligated to make all payments hereunder
excepting the single limitation set forth in the last sentence of Section 6(b). Charter Customer in the issuance of die Charter Customer's general obligation
The Commission will issue its Bonds in specific reliance on the limitations bonds or revenue bonds of its Unit System.In such connection,each Charter
set forth in this Section with respect to the rights of the Charter Customers. Customer and the Commission will comply with all reasonable requests of
each other and will, upon request, do as follows:
Section 16. Modification of this Contract or of the
Chicago Water Supply Contract. Except for revisions and 0) Make available general and financial information about itself;
ad-
justments otherwise expressly provided for, neither this Contract nor the (ii)Consent to publication and distribution of its financial information;
Chicago Water Supply Contract may be changed or modified unless the
consent of the Commission and of three-fourths of the Charter Customers (iii)Certify that general and financial information about it is accurate,
shall have been obtained.Such modification may be requested by any par- does not contain an untrue statement of a material fact and does not omit
ty,in which event a joint meeting of representatives of all governing txxlies to state a material fact necessary in order to make the statements in that
shall be called by the Commission and held not more than sixty(60)days information, in light of the circumstances under which they were made,
after such request is made and not less than thirty(30)days before the giv not misleading;
ing of notice of such meeting. At the joint meeting the requested changes
or modifications shall be considered and discussed. No such change or (iv) Make available certified copies of official proceedings;
modification may materially impair or adversely affect the ability or obliga-
tion of any Charter Customer under the Contract to make payments to(he (v)Provide reasonable certifications to be used in a transcript of closing
Commission at the times, in the amounts, and with the priority required documents; and
in order for the Commission timely to meet its obligations under this Con-
tract,the Chicago Water Supply Contract,other water purchase or sale con- (vi)Provide and pay for reasonably requested opinions of counsel as to
tracts of the Commission and the Bond Resolution,including without limita- the validity of its actions taken with respect to and the binding effect of
lion the making of all deposits in various funds and accounts created under this Contract, title to its Unit System or the Waterworks System, as ap-
the Bond Resolution; or materially impair or adversely affect the ability plicable,pending or threatened litigation which could materially affect its
of the holders of the Bonds or the Trustee, under the Contract or Bond performance hereunder, and other reasonably related opinions.
Resolution,to enforce the terms of the Contract.No such change of modifica-
tion which will affect the rights and interest of the holders of the Bonds Section 20. Regulatory Bodies. The parties through this Con-
shall be made without the written approval of an authorized representative tract seek to exercise and maintain all sovereign rights granted to them under
of the holders of at least seventy percent(70%)of the outstanding Bonds and through the Constitution and laws of the State of Illinois.This Con-
and no such change or modification_shall be effective which would cause tract shall be subject to all valid rules,regulations,and laws applicable hereto
a violation of any provisions of the Bond Resolution or any ordinance passed or promulgated by the United States of America, the State of 11-
authorizing bonds of any Charter Customer. linois,or any governmental body or agency having lawful jurisdiction,or
any authorized representative or agency or any of them;provided however,
Section 17.Non-Assignability. Except to the extent hereinafter that this clause shall not be construed as waiving the right of either party
provided, no party shall assign or transfer this Contract or any rights or to challenge the validity of such rule, regulation,or law on any basis, in-
interests herein without the written consent of three-fourths of the Charter eluding the impairment of this Contract.
Customers and the Commission.The right to receive all payments which {
Section 21. Commission Cooperative Arrangements
are required to be made by the Charter Customers to the Commission in I
accordance with the provisions of this Contract may be assigned by the Com- With Other Water Suppliers. Notwithstanding any of the provi-
mission to any Trustee as provided in the Bond Resolution to secure the sions of this Contract,the Commission is not prohibited by this Contract
payment of the principal of, premium, if any, and interest on the Bonds from entering into cooperative arrangements with other suppliers of Lake
as those amounts come due, subject to the application of those payments Water to provide Lake Water to each other to meet their water needs,
13
provided that these arrangements do not interfere,except in emergencies, Section 26. Execution in Counterparts. This Contract may be
with the delivery of Lake Water to the Charter Customers. executed in several counterparts, each of which shall be deemed to be an
original,and all of which shall constitute but one and the same instrument.
Section 22. Notices and Evidence of Actions. All notices Any such counterpart may be signed by one or more of the parties hereto
or communications provided for herein shall be in writing and shall be so long as each of the parties hereto has signed one or more of such
delivered to the Charter Customers affected or the Commission either in counterparts.
person or by United States trail,via registered mail,return receipt requested, IN WITNESS WHEREOF,the parties hereto have caused their respective
postage prepaid, addressed to the principal office thereof.
corporate names to be subscribed hereto and their respective corporate seals
to be hereto affixed and attested by their duly authorized officers,all on the
Any action hereunder to be taken by the Commission or any Charter date set opposite their respective corporate names.
Customer may be evidenced by copy of official proceedings(including per-
tinent minutes,motions, resolutions,or ordinances)duly certified by the VILLAGE 01; ADDISON,
Clerk of such Charter Customer or the Commission. ILLINOIS
Section 23. Severability. Should any part,term,or provision of By ANTHONY RUSS01"11)
this Contract be determined by a court of competent jurisdiction to be il- President
legal or in conflict with any law,the validity of the remaining portions or 8/29/86
provisions shall not be affected thereby. Date:
[SEAL]
Section 24. Effective Date and Term. For purposes of this
Section of the Contract,the following units of local government are included Attest:
as potential Charter Customers and shall have the MGD value set forth for PANOREA LEKKAS
each in parentheses beside its name. By
Village Clerk
Unit of Local Government and MGD VILLAGE OF BENSENVILLE,
ILLINOIS
Village of Addison (4.980) Village of Lombard (4.634)
Village of Bensenville (2.628) City of Naperville (9.624) By JOHN C. GEILS
Village of Bloomingdale (2.411) Village of Oak Brook (4.219) President
Village of Carol Stream (2.793) City of Oakbrook Terrace (0.663) 8/28/86
Village of Clarendon Hills (0.749) Village of Roselle (2,072) Date:
City of Darien (1.480) Village of Villa Park (2.349) [SEAL]
Village of Downers Grove (6.479) City of West Chicago (2.896)
The County of DuPage (1.492) Village of Westmont (1.818) Attest:
City of Elmhurst (6.021) City of Wheaton (5.909)
Village of Glendale Heights (2.211) Village of Willowbrook (1.287) By ELVIRA L. JOHNSON
Village of Glen Ellyn (3.134) Village of Winfield (0.856) Village Clerk )
Village of Hinsdale (2.906) City of Wood Dale (1.200)
VILLAGE OF BLOOMINGDALF., i
Village of Itasca (0.700) Village of Woodridge (2.599) ILLINOIS
Village of Lisle (2.652)
By SAMUEL J. 'I'ENUTO
The Commission shall authorize and execute this Contract and offer it to the President
aforesaid units.The aforesaid units shall have until September 1, 1986(the 8/29/86
"Charter Date'),to authorize the execution of and execute a counterpart of Date:
this Contract as acceptance hereof and to file same with the Clerk of the Com- [SEAL]
mission.This Contract will become effective on the date(the"Effective Date'),
which must be on or before the Charter Date,upon which said units having Attest: 1
an MGD value as listed which sum to an MGD value of 55 or more shall
have executed and filed counterparts hereof.Said units may become Charter By MARIE E. TAYFEL
Customers by executing and filing counterparts hereof after the Effective Date Village Clerk
but on or before the Charter Date.If on or before the Charter Date an insuf VILLAGE OF CAROL STREAM,
ficient number of said units shall have executed counterparts hereof so as ILLINOIS
to make this Contract effective,then this Contract shall be null and void and
of no effect as to the Commission and all units having so executed and filed. By JANICE GERZEVSKE
If effective as hereinabove provided,this Contract shall continue in force and President
effect until February 24,2024.The Charter Customers and the Commission
agree to begin negotiation of a succeeding Water Purchase and Sale Contract Date: 7/22/86
not later than five(5)years prior to the end of the term of this Contract.
[SEAL]
Section 25. Governing Law; Superseder. This Contract shall Attest:
be construed exclusively under the applicable laws of the State of Illinois.
All other contracts between the Commission and the Charter Customers are By CLELA A. MONTGOMERY
hereby superseded and shall be null and void. Village Clerk
14
VILLAGE OF CLARENDON VILLAGE OF GLENDALE
HILLS, ILLINOIS HEIGHTS, ILLINOIS
By ALAN L HURD By JERI SULLIVAN
President President
Date: 8/4/86 Date: _ 8/28/86
[SEAL] (SEAL]
Attest: Attest:
By _-MARY A. ARNOLD_ By I'A'I''LACNY
Village Clerk Village Clerk
CITY OF DARIEN, VILLAGE OF GLEN ELLYN,
ILLINOIS ILLINOIS
By ERWIN A. SIROVY By _MICHAEL R. FORMENTO
Mayor President
Dale:
8/27/86 Date: 8/25/86
[SEAL] ]SEAL]
Attest: Attest
By GER'IRUDE M. COIT By WILMA 1). LINDE
City Clerk Village Clerk
VILLAGE OF DOWNERS VILLAGE OF HINSDALE,
GROVE, ILLINOIS ILLINOIS
By BETTY M. CHEEVER By RICHARD L. MILLER, JR.
Mayor President
1)atc: 8/18/86 Date: --
[SEAL] ISEALI
Attest: Attest
By BARBARA WALDNER By ELLEN B. MOONEY
Village Clerk Village Clerk
CITY OF ELMHURST, VILLAGE OF ITASCA, ILLINOIS
ILLINOIS
By SHIRLEY H. KETTER
By ROBERT J. QUINN President
Mayor
Date: 8/26/86
i
Date:
8/18/86
ISEAI_�
[SEAL]
Attest.
Attest:
By EDWINA SKORA
By DOROTHY L. SCHMIDTKE Village Clerk
Deputy City Clerk
15
I
VILLAGE OF LISLE, ILLINOIS CITY OF OAKBROOK
TERRACE, ILLINOIS
By GEORGE A. VARNEY
President gy RICHARD F. SARALLO
---Mayor
Date: 8/11/86
Date: 8/27/86
[SEAL] [SEAL]
Attest:
Attest:
By MARJORIE M. CONNELLY
Village Clerk By ROBERTA GRENINGER
_
City Clerk
JOSEPHINE A. HIRSMAN
Deputy Clerk VILLAGE OF ROSELLE,
ILLINOIS
VILLAGE OF LOMBARD, SANDRA J. BIRDSALL
ILLINOIS By
President
By RICHARD ARNOLD
President Date: 7/7/86
Date: 8/21/86 (SEAL]
[SEAL] Attest:
Attest:
By HARRIET M. WARD
Village Clerk
By LORRAINE G. GERHARDT
Village Clerk VILLAGE OF VILLA PARK,
ILLINOIS
CITY OF NAPERVILLE, PAUL W. HYDE _
ILLINOIS By ----
President Pro Tem
By MARGARET P. PRICE
Mayor Dade: --------8/26/86
___ -8/26/86
Date: 8/5186 [SEAL.[
[SEALI Attest:
By M. CAROL REEDY
Attest:
Village Clerk
By SUZANNE L. HOLT
Citv Clerk VILLAGE OF WESTMONT,
ILLINOIS
VILLAGE OF OAK BROOK, FRANK 11. BELLERIVE
ILLINOIS By
Mayor
By WENCE F. CERNE
President Date: 8128/86
Date: 8/12/86 [SEAL]
[SEALI Attest:
By ELMER FRIES
Attest: Village Clerk
By MARIANNE LAKOSIL
Village Clerk
16
CITY OF WHEATON, VILLAGE OF WOODRIDGE,
ILLINOIS ILLINOIS
By ROBERT J. MARTIN By WILLIAM F. MURPHY, JR.
Mayor Mayor
Date: 8/25/86 Date: 8/28/86
[SEAL] [SEAL]
Attest: Attest:
By LILLIAN JOHNSON By DOROTHY M. STAIIL
City Clerk Village Clerk
VILLAGE OF WILLOWBROOK, DuPAGE WATER COMMISSION
ILLINOIS
By GEORGE CONGREVE
By EUGENE NOOSE Chairman
President
Date: 8/29/86
Date: 8/25/86
[SEAL]
[SEAL]
Attest:
Attest:
By PETER W. ERNST
By DARLENE WILSON Clerk
Deputy Village Clerk
CITY OF WOOD DALE,
ILLINOIS
By JERRY C. GREER
Mayor
Dale: 8/25/86
[SEAL]
Attest:
By GERALDINE JACOBS
City Clerk
17