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Agreement Between Metropolitan Water District of Southern California City of Santa Ana, and Municipal Water District of Orange County for In -Lieu Treated Deliveries to MWDOC-Metropolitan Cyclic Account The amount, location, and timing of the delivery schedule, along with an operating plan, will be mutually agreed upon prior to delivery by Metropolitan pursuant to a purchase agreement. The actual amount of in -lieu deliveries credited by Metropolitan may be higher or lower based on operational conditions and the Certification Procedures For In -Lieu Treated Deliveries for Cyclic Agreement Between Metropolitan Water District of Southern California, City of Santa Ana, and Municipal Water District of Orange County referenced in Section 8. In - Lieu Treated Deliveries will be made upon Metropolitan's written request and City's and MWDOC's written acceptance of additional treated water deliveries. The City represents and warrants that In -Lieu Treated Deliveries are in addition to its projected full -service deliveries (treated or untreated), which would normally occur without this agreement. MWDOC represents and warrants that an amount equivalent to the In -Lieu Treated Deliveries will be credited to Metropolitan as stored water in the Orange County Basin, pursuant to an intentional reduction in groundwater production by the City, certified and reconciled according to Section 8, until such time as the water is purchased by MWDOC pursuant to the terms of the MWDOC-Metropolitan Cyclic Agreement and Section 9 of this Agreement. Section 3. Term. This Agreement is effective as of November 5, 2019 and shall continue until July 1, 2027, or until the termination of the MWDOC-Metropolitan Cyclic Agreement, and is applicable only to In -Lieu Treated Deliveries, as certified and reconciled according to Section 8. Metropolitan, at its sole discretion, can interrupt the program authorizing In -Lieu Treated Deliveries by providing 15 days' notice to the City and MWDOC. Pursuant to Metropolitan's Board action on April 10, 2019, Metropolitan's General Manager may make a determination regarding water supply conditions and Metropolitan's ability to capture all available supplies at any time during the term of this Agreement. When such determination is made and MWDOC and City agree to accept water pursuant to this Agreement, MWDOC will enter into a purchase agreement in accordance with Section 2. Section 4. Treatment Surcharge Payment. The City agrees to pay Metropolitan the Treatment Surcharge effective at the time of the In -Lieu Treated Delivery, which for calendar year 2019 is $319 per acre-foot and in calendar year 2020 is $323 per acre-foot. Section 5. Cost -offset Credit Term. In exchange for the City's acceptance of In -Lieu Treated Deliveries, Metropolitan agrees to pay the City a cost -offset credit of up to $225 per acre-foot, as determined by Metropolitan pursuant to Section 6. On January I" of 2020, and every following January 1st, the maximum $225 per acre-foot amount will be increased by the Consumer Price Index for Urban Wage Earners and Clerical Workers for Los Angeles -Long Beach -Anaheim All Items (CPI-U) calculated as the November Prior Year/November 2018 CPI-U increase rounded to the nearest #11706v4 25E-5