ORANGE COUNTY WATER DISTRICT (4) - 2015

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2.4. The City shall pay the replenishment assessment and additional replenishment assessment levied and imposed pursuant to Sections 27 and 27.1 of the OCWD Act on all groundwater produced by the City during the Project Term, including all groundwater produced from Well 32, Well 36 and Well 39, in accordance with Section 29(a) of the OCWD Act. 2.5. To the extent that the City's production of groundwater during the Project Term does not exceed an amount equal to the BPP plus additional groundwater produced from Well 32, and all of the groundwater produced during the Project Term in excess of the BPP was produced from Well 32, the City shall be exempt during the Project Term from paying the basin equity assessment or any surcharge on such grouuldwater production above the BPP from Well 32 during the Project Term to allow the City to recoup the Project Cost, as described in the Attached Exhibit A attached hereto and by this reference incorporated herein. Notwithstanding the foregoing, the City shall pay the applicable basin equity assessment and any surcharge for the following: 2.5.1. The City shall pay the applicable basin equity assessment and surcharge on all groundwater produced by the City during the Project Term that exceeds an amount equal to the BPP plus additional groundwater produced from Well 32; and 2.5.2. The City shall pay the applicable basin equity assessment and surcharge on all groundwater produced by the City during the Project Term in excess of the BPP, if such groundwater in excess of the BPP is produced from any water production facility other than Well 32. SECTION 3. CITY GROUNDWATER PRODUCTION DURING THE PROJECT REMAINDER TERM 3.1. Following completion of the Project Term, and for ten consecutive years thereafter, (such ten -year period is hereinafter referred to as the "Project Remainder Term "), the City shall make its best efforts to continue to operate Well 32 throughout the Project Remainder Term. 3.2. Beginning the first fiscal year of the Project Remainder Term, and each fiscal year thereafter during the Project Remainder Term, the City shall pay the then- applicable replenishment assessment, additional replenishment assessment and, if applicable, the basin equity assessment and surcharge, on all groundwater produced by the City during that fiscal year, including all groundwater produced form Well 32, in strict compliance with Sections 29 and 31.5 of the OCWD Act. 3.3. Notwithstanding Paragraphs 3.1 and 3.2 above, in the event that the City was unable to produce sufficient groundwater from Well 32 during the Project Term to allow the City to achieve a total groundwater production equal to the BPP plus the additional groundwater produced from Well 32 so as to recover the Project Cost, the City and OCWD shall meet and confer to implement the program described in Exhibit A to allow the City to increase production from Well 32 for additional time to allow the City to achieve the total amount of Well 32 groundwater production that had been intended for the Project Term and thereby recover the City of Santa Ana Agreement xxxxxx.I a08/02/19 -4- XXXXX.t