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80-013g San Jose Water Works, Installation of Water Facilities, Tract No. 6921", . MAIN EXTENSION CONTRACT SUBDIVISIONS, TRACTS, HOUSING PROJECTS, INDUSTRIAL DEVELOPMENTS OR ORGANIZED COMMERCIAL DISTRICTS Distribution Plant Only -No Special Facilities Fire Flow Requirements Meet General Order No. 103 IRACI 6921 THIS AGREEMENT, made and entered into this ;;Z:;;;;1rJ dayof ~ person o~in , 19 6 ,2......., by and between the paragraph 1 hereof, hereinafter collectively referred to as "Applicant," and SAN JOSE WATER WORKS, a California corporation, hereinafter referred to as "Utility," WIT N E SSE T H : WHEREAS, the Applicant is the developer of that certain subdivision of real property situate, lying and being in the County of Santa Clara, State of California, which is known as _____ I_RA __ C_T_6_9_2_1 __________ Subdivision, in accordance with the map thereof filed in the office of the County Recorder of said County on ______ ~O~c~to~b~e~r~2 ________ ___ 19 81 ,in Book ___ 4_9_0 __ of Maps a t page -,(c=s,L) ..... 4'-'4'-=-,,_4"'5'--_______ _ and which is hereinafter referred to as the "Subdivision," and WHEREAS, Applicant is now selling or proposes in the near future to sell lots in the Subdivision and to this end desires to have water service available in the Subdivision through and by means of mains and appurtenances to be installed therein substantially as shown on that certain map attached hereto, marked Exhibit B and by this reference made a part hereof, and by services (including service pipes, fittings, gates and housings therefor, and meter boxes) to be installed in accordance with Utility's usual practices, said mains, appurtenances and services being hereinafter referred to as the "Facilities;" and WHEREAS, the installation of the Facilities and the furnish- ing of water service through and by means thereof are necessary and valuable adjuncts to the sale of lots in the Subdivision, and will materially increase the value of said lots; and WHEREAS, upon the terms and.conditions herein set forth Utility is willing to install the Facilities and to furnish water service in the Subdivision through and by means thereof at the rates and in accordance with the rules of the Utility now in force, or that may from time to time hereafter be lawfully established in its service area; NOW, THEREFORE, for and in consideration of the premises and of the mutual covenants, agreements, terms and provisions herein contained, it is agreed as follows to wit: 1. Applicant. The names and addresses of the person or persons herein collectively referred to as "Applicant" are as follows: Name Mr. Travice Whitten City of Cupertino Address 10300 Torre Avenue Cupertino, CA 95014 2. Applicable Rule. This agreement is entered into pursu?nt to the requirements and in accordance with the various applicable provisions of Utility's Main Extension Rule, hereinafter referred to as the "Rule," in effect and on file with the California Public Utilities Commission; a copy of the Rule is attached hereto, marked Exhibit A and by this -2 - '. , reference made a part hereof. This agreement does not, therefore, require specific authorization of said Commission to carry out its terms and conditions. 3. Fire Protection. The distribution system is designed to meet the minimum fire flow requirements contained in Section VIII lea) in the California Public Utilities Commission General Order No. 103 as ordered by Decision No. 84334, effective June 5, 1975. 4. Applicant's Deposit. The estimated total installed cost of the Facilittes, hereinafter referred to as the "Estimated Cost." is $ 13,870 Applicant has advanced to Utility an amount equal to the Estimated Cost, receipt of which amount is hereby acknowledged by Utility. 5. Installation of Facilities. Utility agrees that it will, as soon as necessary materials and labor are available, and necessary permits, franchises, licenses or other govern- mental authorizations have been obtained, commence and prosecute to completion with all reasonable diligence the work of installing the Facilities. Utility reserves the right to make such changes in design or materials as it may deem necessary. Within sixty (60) days after Utility has ascertained its actual costs in installing the Facilities, it will provide Applicant with a statement of the same showing in reasonable detail the costs incurred for materials, labor and other direct and indirect costs, overheads and total costs, or unit costs or contract costs, whichever are appropriate. If such actual construction costs shall not have been determined within one hundred twenty (120) days after completion of con- struction work, a preliminary determination of actual costs -, - '. , shall be submitted, based upon the best available information at that time. If such actual costs as finally determined shall be greater or less than the Estimated Cost, the difference shall be advanced by Applicant to Utility or repaid by Utility to Applicant as the case may be, and the Estimated Cost adjusted accordingly. The Estimated Cost as so adjusted shall be Applicant's Advance Subject to Refund. 6. Engineering and Street Grades. Applicant agrees to set stakes on the street and lot boundaries of the Subdivision and provide Utility with finished street grades and typical cross sections to enable Utility to determine a location for the mains and the depth to which they are to be laid. Utility will determine the locations and depths of the mains in relation to the data furnished by Applicant. Installation of the mains will not be commenced by Utility until curbs and gutters have been installed and street grades have been brought to those established by public authority. In the event Utility incurs any cost or expense in relocating, raising or lowering the Facilities-by reason of inaccuracy of Applicant in performance of its obligations under this paragraph, Utility shall give written notice to Applicant of such actual cost or expense within ten (10) days after Utility has ascertained the same, and Applicant agrees to pay Utility promptly the amount thereof, which shall not be subject to refund by Utility hereunder. 7. Applicant's Agreements. Applicant agrees to use its best efforts to assist Utility to obtain any and all permits, franchises or other governmental authorizations which may be required for the installation of the Facilities. -4 - , e , '. ~ 8. Refund. Provided that Applicant is not in default hereunder, Utility agrees to make refunds hereunder to Appli- cant or such other party as may be entitled thereto in cash, without interest, for a period not to exceed twenty (20) years from the date hereof in annual payments made within forty-five (45) days of the anniversary of the date of com- pletion of installation of the Facilities. Refunds shall be determined as follows: Utility shall determine the revenues received by it from customers, including fire protection agencies, supplied by service pipes directly connected to the Facilities; the refund shall be 22% of the revenue so received. The total amount so refunded shall not exceed Applicant's Advance Subject to Refund, without interest. 9. Service from Facilities, The Facilities were designed to serve hereto. ______ 7L-_______ customers as shown on Exhibit B If at any time within twenty (20) years from the date hereof ________ 6 ____________ bona fide customers (defined in Section A.3.a, of the Rule) are being served from the Facilities, Utility will so notify Applicant, and at that time will become obligated to pay Applicant in cash any balance of Applicant's Advance Subject to Refund which may remain unrefunded at the end of said twenty (20) year period, Any such balance shall be refunded in five (5) equal annual install- ments, payable beginning twenty-one (21) years from the date hereof. 10. Utility's Right of Offset, In the event Applicant shall become entitled to a repayment or refund under the provisions of paragraph 5, 8 or 9 of this agreement, Utility shall have the right at such time to offset against the amount then due Applicant hereunder the total amount of any indebtedness then due or owing'by Applicant to Utility, -5 - " '. ,.f 11. Ownership. The Facilities to be installed here-, under and all construction work in connection therewith shall be and remain at all times the property of Utilities, and Applicant shall have no right, title or interest what- soever in or to the same. 12. Construction Delay. Utility shall not be responsi- ble for any delay in construction resulting from any cause beyond its control, including, without limiting the generality of the forego.ing. any delay resulting from inability to obtain sufficient proper materials and supplies, labor disturbances or shortages, or weather, conditions or inability to obtain necessary permits, licenses, franchises or other governmental authorizations. In the event Utility is unable to obtain sufficient materials to meet all construction requirements necessary to provide adequate service to all its customers, it shall be entitled to allocate materials obtained by it to such construction projects as in its sole discretion it deems most important to service needs of its customers, and any delay in construction of the Facilities resulting from any such allocation of materials by Utility shall be deemed to be a cause beyond its control and it shall not be responsible for such delay. 13. Notices. Any notice which it is herein provided mayor shall be given by either party to" the other shall be deemed to have been duly given when deposited in the United States mail, registered or certified, postage prepaid and addressed to the party to whom such notice is given at the following respective addresses: -6 - · ~ ".'" To Applicant, Mr. Travice Whitten City of Cupertino 10300 Torre Avenue Cupertino, CA 95014 To Utility: San Jose Water Works P.O. Box 229 374 West Santa Clara Street San Jose, California 95196 Either party, by notice given as hereinbefore provided, may change the address to which notice shall thereafter be addressed. 14. Nature of Obligations; Assignment. If more than one person is named in paragraph 1 hereof, the obligations of the persons executing this agreement as Applicant shall be joint and several. Until Applicant shall notify Utility in writing to the contrary, all refunds hereunder shall be paid by Utility to Mr. Travice Whitten, City of Cupertino, 10300 Torre Avenue, Cupertino. CA 95014 Applicant may assign this agreement upon ,vritten notice to Utility at any time following determination of the amount of Applicant's Advance Subject to Refund. Any such assignment shall apply only to those refunds hereunder which become due more than thirty (30) days after the date of receipt by Utility of such notice of assignment. Utility will not make. any single refund payment hereunder to more than one person. 15. Successors and Assigns. Subject to the provisions of the preceding paragraph 14, this agreement shall inure to the benefit of and shall bind the respective heirs, executors, administrators, successors and assigns of the parties hereto. -7 - .1 ... _ .. U • 'l" " 16. Jurisdiction of Public Utilities Commission. This agreement shall at all times be subject to such changes or modi- fications by the California Public Utilities Commission as said Commission may from time to time direct in the exercise of its jurisdiction. 17. Applicant's Responsibility. Applicant hereby agrees to indemnify Utility against any and all loss or injury to any of Utility's meters, pipes, or any other installations in the Subdivision caused by Applicant and/or its agents, servants, employees or by subcontractors or independent contractors performing services and/or furnishing materials to and for the benefit of Applicant. IN WITNESS WHEREOF, the parties hereto have executed this agreement in duplicate the day and year first above written. By ~-J21tL~~~~--------Its By -e:C~ TI~t~s~S~e~c~r~e~t~a~r~y~-------------- UTILITY City Clerk APPLICANT .•. , ... ~ '- " -8 - • Rule Nc. 15 MAIN LXTLNSIONS A. General Provisions and Definitions, 1. Applicability a, All extensions of distribution' mains, from the utility's basic production and transmission system or existing distribution system, to serve new customers, except for those specifically excluded below, shall be made under the provisions of this rule unless specific authority is first obtained from the Commission to deviate therefrom. A main extension contract sha.lI be executed by the utility and the applicant or applicants for the main extension before the utility commences construction work on said extensions or, if constructed by applicant or applicants, before the facilities comprising the main extension are transferred to the utility. b. ExtenSions solely for fire hydrants, private fire protection; resale, temporary, standby, or'supplemental service shall not be made under this rule. c. The utility may, but will not be required to, make extensions under this rule in easements or rights of way where final grades have not been established, or where street' grades have not been brought to those established by public authority. If extensions are made when grades have not been established and there is a reasonable probability that the existing grade will be changed, the utility shall require that the appli- cant or applicants for the main extens ion depos it, at the time of execution of the main extension agreement, the estimated net cost of relocating, raising or lowering facilities upon establishment of final grades. Adjustment of any difference between the amount 50 deposited and the actual cost of relocating, raising or lowering facilities shall be made within ten d!lYs after the utility has ascertained such actual cost. The net deposit representing actual cost is not subject to refund. The entire depos it related to the proposed relocation, rais ing or lowering s hall be refunded when such displacements are determined by proper authority to be not required. 2. Limitation of Expansion 3. a, Whenever the outstanding advance contract balances reach 40 percent to total capital (defined, for the purpose of this rule, as proprietary capita t, or capita I stock and surplus, plus debt and advances for construction) the utility shall so notify the Commission within thirty d'ays. b. Whenever the outstanding advance contract balances plus the advance on a proposed new extens Ion would exceed 50 percent of total capital, as defined in Section A. 2. a, plus the advance on the proposed new extens ion, the utility shall not make the proposed new extension of distribution mains Without authorization of the Commission. c. Whenever the outstanding advance contract balances reach the above level, the utility shall so notify the Commission within thirty days. Denn ilions a. A "bona fide customer." for the purposes of this rule, shall be a customer (excluding any customer formerly served at the same location) who has given satisfactory evidence that service will be reasonably .. 1\: General Provi.!!ions ,'ndllefinllion,! ((;olllinued) permanent to the property which has been improved with a building o( a permanent nature, ilnd to which service hiJS commenced. The provision of service to il redl estilte developer or builder, during the construction or development period, shall not establish him (IS a bona fide customer. b. A" real es tate developer" or "builder", for the purposes of this rule, shall include any individual, association of individuals, partnership, or corporation that divides a parcel of lanEl into two or more portions. c. The "adjusted construction cost", for the purposes of this rule, shall be reasonable and sha It not exceed the costs recorded in conformity with generally accepted water utility accounting practices. and as specifically defined in the Uniform System of Accounts for Water Utilities prescribed by the Commission, of installing facilities of adequate capacity for the service reques ted. If the utility, ,at its option, should install facilities with a larger capacity or resulting in a greater footage of extens ion than required for the service reques ted, the "adjusted construction cost", for the purposes of this rule, shall be determined by the appliciltion of an adjustment factor to actual construction cost of facilities installed. 4. Ownership, Design' and Construction of Facilities a. Any facilities installed hereunder shall be the sole property of the utility. In those instances in which title to certain portions of the installation, such as fire hydrants, will be held by a political sub- diviSion, such facilities shall not pe included as a part of the main extens ion under this rule. b. The size, type, quality of materials, and their location shall be speCified by the utility; and the actua 1 cons truction shall be done by the utility or by a constructing agency acceptable to it. c. Where the property of an applicant is located adjacent to a right of way, exceeding 70 feet in width, for a street, highway, or other public purpose, regardless of the Width of the traveled way or pave- ment; or a freeway, waterway, or railroad right of way, the utility may elect to install a main extension on the same side thereof as the property of the applicant, and the estimated and adjusted construction costs in such case shall be based upon such an extension. d. When an extension must comply with an ordinance, regulation, or specification of a public authority, the estimated and adjusted construction costs of said extenSion shall be based upon the facilities required to comply therewith. 5. Estimate"s, Plans and Specifications a. Upon reques t by a potentia I applicant for a main extens ion, the utility shall prepare, without charge, a preliminary sketch and rough estimates of the cost of installation to be advanced by said applicant. b. Any applicant for a main extension requesting the utility to prepare detailed plans, speCifications and cost estimates shall be required to deposit with the utility an amount equal to the estimated cost of " A. . General Provisions and Definitions (Continued) preparation of such moteri,lI. The utility shall, upon request, make available within 4S days after receipt of the deposit referred to above, such plans, specifications and cost estimates of the proposed main extension. If the extenSion is to include oversizlng of facilities to be done at the utility's expense, appropriate details shall be set forth in the plans, specifications and cos t es timates . c. In the event a main extension contract with .the utility is executed within 180 days after the utility furnishes the detailed plans and specifications, the deposit shaH become a part of the advance, and shall be refunded in accordance with the terms of the main extension contract, If such contract is not so executed, the depo'slt to cover the cost' of preparing pl,ans, specifications and cost estimates shall be forfeited by the a;;lplicant for the main extension and the amount of the forfeited deposit sha.ll be credited to the account or accounts. to which the expense of preparing said material was charged, d. When detailed plans, specifications and cost estimates are requested, the applicant for a main extension shall furnish a map to a suitable scale showing the street and lot layouts and, when requested by the utility, contours or other indication of the r.elative elevation of the various parts of the area to be developed, If changes are made sub- sequent to the presentation of this map by the applicant, and these changes require additional expense in revising plans, specifications and cost estimates., this additional expense shall be borne by the applicant, not subject to refund, and the additional expense thus recovered shall be credited to the account or accounts to which the additional expense was charged. 6. Timing and Adjustment of Advances a , Un less the applicant for the main extension elects to arrange for the installation of the extension himself, as permitted by Section C.l . c. , the fu 11 amount of the required advance of an acceptable surety bond must be provided to the utility at the time of execution of the main extension agreement. b. If the appHcant for a main extension posts a surety bond in lieu of cash, such surety bond must be replaced with cash not less than ten calendar days before construction is to commence; provided, however, that if special facilities are required primarily for the service requested, the applicant for the extension may be required to deposit sufficient cash to cover the cost of such speCial facilities before they are ordered by the uti lity . c. An applicant for a main extension who adval}ces funds shall be provided with a statement of actual construction cost and adjusted construction cost showing in roasonable detail the costs incurred for material, labor, any other direct and indirect costs, overheads, and total costs; or unit costs; or contract costs, whichever are appropriate. d. Said statement shall be submitted within sixty days after the actual construction costs of the' installation have been ascertained by the mil!t),. In the event that the actual construction costs for the entire . installation shall not have been determined within 120 days after A, Genera I Provisions and Defina ions (Continued) completion of construction work, a preliminary determination of actual and adjusted construction costs shall be submitted, based upon the best available information at that time, e. Any differences between the adjusted construction costs and the amount advanced shall be shown as a revision 'of the amount of advance and shall be payable within thirty days of date of submission of statement, 7, Assignment of Main ExtenSion Contracts Any contract entered into under Sections Band C of this rule, or under similar provisions of former rules, may be assigned, after settlement of adjusted construction costs, after written notice to the utility by the holder of said contract as shown by the utility's records, Such assign- ment shall apply only to those refunds which become due more than thirty days after the date of receipt by the utility of the notice of 'assignment. The utility shall not be required to make anyone refund payment under such contract to more than a single assignee. 8, Interpretations and Deviations In case of disagreement or dispute regarding the application of any provision of this rule, or in circumstances where the application of this rule appears unreasonable to elther party, the utility, applicant or applicants may refer the matter to the Commission for determination, -4 - Rule No. 15 HAIN EXTENSIONS -~ .... C. !~.tensions to Serve Subdivisions, Tracts, Housing Projects, Industrial Developments or Organized Commercial Districts 1. Advances a. Unless the procedure outlined in Section C.l.c. is followed, an applicant for a main extension to serve a new subdivision, tract, housing project, industrial development or organized commercial district shall be required to advance to the utility, before con- struction is commenced, the estimated reasonable cost of the exten- sion to be at!tually installed, from the nearest utility facility at least equal in size or capacity to the main required to serve both the new customers and a reasonable estimate of the potential customers who might be served directly from the main extension with- ont additional extension. The costs of the extension shall include necessary service stubs or service pipes, fittings, gates and housing therefor, and meter boxes, but shall not include meters. To this ahall be added the cost of fire hydrants when requested by the appliCant for the main extension or required by public authority, whenever snch hydrants are to become the property of the utility. b. If special facilities consisting of items not covered by Section C.1.a. are required for the service requested and, when such facilities to be installed will supply both the main extension and other parts of the utility's system, at least 50 percent of the design capacity (in gallons. gpm, or other appropriate units) 1s required to supply the main extension, the cost of such special facilities may be included in the advnnce, subject to refund, as hereinafter provided, along wi th refunds of the advance of the ,',ost of the extension facilities described in Set:tion C.1.2. above. c. !n lieu of providing the advances in accordance with Section C.1.a. and C.l.b •• the applicant for a main extension shall he permitted, if qualified in the judgment of the utility, to construct and install the facilities himself, or arrange for their installation pursuant to competitive bidding procedures initiated by him and limited to qualified bidders. The cost. including the cost of i.nspection and supervisIon by the utility, shall be paid directly by applicant. The applicant shall provide the utility with a statement of actual, construction cost in reasonable detail. The amount to be treated as an advance subject to refund shall be the lessex of (1) the actual cost or (2) the price quoted in the utility's detailed cost estimate. The installation shall be in accordance with the plans and specifications submitted by the utility pursuant to Section A.S.b. Z, Refunds a. The amount advanced under Sections C.I.a •• C.l.b. and C.l.c. shall be subject to refund by the utility, in cash, without interest, to the party or parties entitled thereto as set forth In the following two paragraphs. The total amount so refunded shall not exceed the total of the amount advanced. Except as hereinafter provided, the refunds shall be made in annual, semiannual or quarterly payments, at the election of the utility. and for a period not to exceed 20 years after the date of the contract, C. Ext~_~ions to S.~rve Subdivisions, Tract~ousing Proje5:ts, Industrial Develo.pments o.r Organized Co.mmercial Districts (Co.ntinued) b. Whenever costs of main extensions have been advanced pursuant to Sections C.I.a. or C.I.c., the utility shall determine the revenue received fro.m custo.mers, including fire protection agencies, supplied by service pipes connected directly to the extension for which the cost was advanced. The refund shall be 22% of the revenue so received. c. Whenever costs of special facilities have been advanced pursuant to. Sectio.ns C.l.b. or C.I.c., the amount so advanced shall be divided by number of lots to be served by the special facilities. This advance per lo.t shall be refunded for eac.h lot on which one or more bona fide custamers are served by thase facilities. d. With respect to. a co.ntract entered into cn and after the effective date of this rule, if, at any ti~e during the 20-year refund period specIfied abave, 80% of the bo.na fide customers for which the extensio.n o.r special facilities were designed are being served therefram, the utility shall immediately notify the cantract holder af that fact, and at that time shall become obligated to. pay, in cash, any balance which may remain unrefunded at the end af said 20-year periad. Such balance shall be refunded in five equal annual installments, payable beginning 21 years after the date of the contract. e. Where a can tract has been entered into. under a farmer main extension rule, and where 80% of the bona fide customers far which the extension 0.17 special facilIties were designed are being served therefrom, the utility may negotiate and enter into a new and substitute contract, Identical in all respects with the ariglnal contract, including the original terminatian date, c.xcept that sald substitute contract shall include the following provision: "Natwithstanding any other pro.visions hereaf, any unrefunded balance remaining at the termlnation date of this cantract shall. be paid in five equal annual installments beginning one year after said termination date." The advice letter pravisions af Section X of General Order No. 96-A shall apply to all such replacement contracts. 3. Termination af Main Extension Contracts a. Any contract with refunds based upon percentage af revenues and entered into under Sectian C. af this rule, or under similar provisions of farmer rules, may be purchased by the utility and terminated, provided the payment is nat in excess of the estimated revenue refund multiplied by the termination factor in the following table, the terms are otherwise mutually agreed to. by the parties or their assignees and Section C.3.b. and Secticn c.3.c. hereof are complied with. The estimated revenue refund is the amount that would otherwise be refunded, at the current level of refunds, over the remainder of the twenty-year contract period, or sharter periad that would be required to extinguish the total refund abligatian. It shall be determined by multiplying 22 percent of the average annual revenue per service for the immediately preceding calendar year by the number of bona fide customers at the proposed terminatian date, times the number af years or fractians thereaf to. the end af the twent.y-year contract period or shorter periad that would be required to. refund the remaining cantract balance. - 2 - ........ Years Remaining 1 2 3 4 5 6 7 8 9 10 Termination Factors Factor .8929 .8450 .8006 .7593 .7210 .6852 .6520 .6210 .5920 .5650 ,(ear" Remainlng 11 12 13 14 15 16 17 18 19 Factor .5398 .5162 .4941 .4734 .4541 .4359 .4188 .4028 .3877 b. The utility shall furnish promptly to the Commission the following information in writing and shall obtain prior authorization by a formal application under Sections 816-830 of the Puhlic UtHities Code if ' payment is to be made other than in cash: (1) A copy of. the main extension contract, together with data adequately describing the development for which the advance was made and the total adjusted construction cost of the extension. (2) The balance unpaid on the contract and the calculation of the maximum termination price, as above d!!fined, ,as of. the date of termination and the terms under which the obligat.lon was terminated. (3) The name of the holder of the contract when terminated. c. Discounts obtained by the utility from contracts terminated under the provisions of thj:s section shall be accounted for by credits tEl Ac. 265, Contributions in Aid of Construction. D. Extension Designed to Include Fire Protection 1. The cost of distribution mains designed to meet the fire flow require- ments set forth in Section VIII.l(a) of General Order No. 103 is to be advanced by the applicant. The utility shall refund this advance as provided in Sections E.3. and C.2,'of this rule. 2. Should distribution mains be designed to meet fire flow requirements in excess of those set forth in Section VIII.1(2) of General Order No. 103, the increase in cost bf the distribution mains necessa'ry to meet such higher fire flow requirements shall be paid to the utility as a contribution in aid of construction. 3, The cost, allocated as appropriate, of faciliti.es other than distri- buthlO mains required to provide supply, pressure, or storage primar- ily (or fire protc('ti(lll ,,"~pOAe~ AhllJl b~ I'~'id tll the utU:ity as II eontrlhutlon in Ilid of ,'onstrtl"tion.