EXHIBIT 22-B

 

DRAFT

Amended Well Use Agreement

Between

Gary M. and Ingrid B. Brant

Trustees of the Brant Family Trust

And

Monterey Peninsula Water Management District

 

By this Amended Well Use Agreement, the Monterey Peninsula Water Management District, a California special district, and the Brant Family Trust set all terms and conditions related to access and use of the Schulte South Irrigation Well as referenced in the Agreement for the Monterey Peninsula Water Management District To Sell and the Brant Family Trust To Purchase the Schulte South Irrigation Well.

1. Facts

 

This Amended Well Use Agreement is executed in connection with that certain Memorandum of Agreement (MOA) dated 21 August 1997 between GMB & Associates, Inc., a California Corporation, and the Monterey Peninsula Water Management District (District), and that certain Well Use Agreement (1997 Well Use Agreement) dated 7 August 1997 between GMB & Associates, Inc. and the District, and that certain Agreement for the Monterey Peninsula Water Management District To Sell and the Brant Family Trust To Purchase the Schulte South Irrigation Well (Sales Agreement) dated April May [insert day], 2015;

 

On 5 December 2005, Gary M. Brant notified the District of the transfer of the real property described in Exhibit "A" in the 1997 Well Use Agreement (Property) to Gary M. Brant & Ingrid B. Brant, Trustees of the Brant Family Trust (Property Owner);

 

For the purposes of this Agreement, the term “Well” refers to that certain water well known as the Schulte South Irrigation Well constructed by the District on the Property in 1988 for the purpose of irrigating riparian vegetation within a portion of the riparian corridor of the Carmel River.  The term, and includes the “Well Area”, refers to the existing 20-foot by 20-foot area on the Property that is labeled as “MPWMD Well Site” in Exhibit “A” to the 1997 Well Use Agreement.  The Well Area contains the Well. 

 

Property Owner and the District have negotiated in good faith to execute the Sales Agreement to effect sale of the District-owned Well and a portion of its appurtenances to the Property Owner;

 

On April May ______, 2015, the Property Owner acquired the Well and a portion of its appurtenances on the Property from the District;

 

Property Owner and the District do herby agree to this Amended Well Use Agreement (Agreement), which Agreement supersedes all provisions of the MOA, 1997 Well Use Agreement, and any other oral agreement as follows:

2. Installation and Location

 

Property Owner, together with its agents, successors and assigns, grants to the District, its agents, successors and assigns, the right to use the well and maintain District Appurtenances for the purpose of irrigating that portion of the riparian corridor of the Carmel River within the Project Irrigation System. For purposes of this Agreement, appurtenances to be retained by District on the Property (District Appurtenances) extend from the District connection at the Well to the Property line and include, but are not limited to, a water meter, an irrigation system timer, and subsurface pipelines.  The Project Irrigation System begins at the Property line and extends two thousand (2,000) feet upstream and two thousand (2,000) feet downstream of the Well. Each party to this Agreement shall be responsible for maintaining its own connection to the Well and for metering its water use from the Well.  If the Property Owner’s meter fails is and needs replacement, the Property Owner shall notify the District of the date the meter is to be replaced and the District shall be allowed to inspect the failed meter to determine the final reading.

 

3. Ownership of the Well

 

The Well and all of its appurtenances, except District Appurtenances, are the property of the Property Owner.  If Property Owner chooses not to continue use of the Well (i.e., the Property Owner proposes to abandon the Well), the Property Owner shall provide the District sixty (60) days written notice prior to abandonment.  The Property Owner shall be responsible for all costs of abandonment, unless otherwise agreed to by the District.

 

4. Responsibility for Costs

 

For the purposes of this Agreement, and except as expressly provided otherwise in this Agreement, the term “Costs” shall include all costs of operation, improvement, insurance, maintenance, repair, restoration and replacement of the Well.

 

Property Owner shall bear primary responsibility for paying all costs to supply electrical power to the Well; the electrical service shall be in the Property Owner’s name.  Annually, prior to commencing irrigation of the riparian corridor, the District shall notify the Property Owner of the date when the District expects to begin using water from the Well.  After cessation of the irrigation season, the District shall notify the Property Owner of the date of the last water use from the Well.  During periods of the year when the District uses water from the Well, the District shall record water use of the Property Owner and the District and provide a record of water use to the Property Owner at least once per year or on a more frequent basis if requested.  The Property Owner shall provide the District with a copy of the monthly statement(s) from the electrical service provider.  The District shall provide to the Property Owner  a formula for sharing costs of electrical power which shall be in proportion to the actual amount of water used by each party to this Agreement during the period of billing.  The District shall pay Property Owner for the pro rata share of electrical service costs associated with the District’s use of the Well.  Payment shall be made within sixty (60) days of the presentation of a bill by the Property Owner to the District for such use.  During periods of the year when the District does not use water from the Well, the District shall have no obligation to record Property Owner’s water use or provide a formula for share of costs of electrical power.  The District’s only obligation to pay for electrical service costs during periods of non-use of the Well by the District shall be one-half of the meter charge.  Until such time as the Property Owner uses water from the Well, the District will pay its share of the standby meter charge within sixty (60) days of the presentation of a bill by the Property Owner.

 

Commencing with execution of this Agreement, the District shall use a cumulative total of water use  to determine the pro rata share of Costs for maintenance and repair of the Well.(See Section 10 of this Agreement, Well Maintenance and Repair, regarding responsibility for conducting maintenance and repair.) The District shall pay Property Owner for the pro rata share of  Costs so determined.  Payment shall be made within sixty (60) days of the presentation of a bill for such maintenance and repair, subject to verification of actual r Costs.  Restoration or replacement costs shall be borne by the District in an amount equal to 1.00 divided by 2.06 multiplied by the remaining potential Length of Agreement as determined under Section 12, including extensions, divided by 25.

 

Property Owner shall keep the Well and the Property free and clear of mechanic's or other liens arising from any work of repair, restoration, replacement or improvement to the Well Area.  Property Owner shall pay any lien, claim or demand before any action is brought to enforce such a lien against the Well Area or Property. Property Owner shall indemnify and hold the District free and harmless from any and all liability from such liens or demands, together with costs and expenses in connection therewith, including attorney's fees. The District’s only obligation shall be for Costs and expenses associated with operation, improvement, maintenance, repair, restoration and replacement of the Well Area on a pro-rata basis as described above.

 

Property Owner shall have the right to challenge the District’s formula and calculation of water use or pro rata shares.  Property Owner shall give the District written notice of such challenge within thirty (30) days after the submission by the District to the Property Owner of a report of water use or a calculation of pro rata share.  If the District does not agree with the Property Owner’s challenge, the validity of the challenge shall be determined by an independent third-party auditor agreed to by the parties.  If the challenge is successful, the District shall pay all costs of the challenge.  If the challenge is unsuccessful, the Property Owner shall pay all costs of the challenge. 

 

Property Owner shall give the District sufficient advance notice of the commencement of any repairs or improvements to the Well  to allow the District time, and shall permit the District or its agents to enter the Property upon reasonable notice to the Property Owner, to post thereon notices of non-responsibility or such other notices as are required by law or appropriate for the protection of the District’s interest in the Well and the District Appurtenances from mechanic' s liens or liens of a similar nature.

 

5. Well Area Appearance

 

The Well Area shall be maintained in a manner that will accommodate all appurtenances necessary for the proper functioning of the Well, District Appurtenances, and Project Irrigation System.  Property Owner reserves the right to alter the limits of the Well Area , but in no event shall the Well Area be reduced so as to impair the proper functioning of the Well or supply of water to the District.

 

6. Location of Utilities and Waterlines

 

The District shall have the right to install and maintain a timed electrical irrigation system at the Well Area for use with the Project Irrigation System. The District shall have the right to maintain water pipes from the District’s connection to the Well to the point of connection to the Project Irrigation System.  All irrigation mainline water pipes shall be installed underground on the Property between the Well Area and points of connection to the Project Irrigation System. Plans and specifications for improvements shall be reviewed and approved by the Property Owner prior to installation. Maintenance of the Project Irrigation System shall be at the discretion of the District. All Project Irrigation System equipment and materials installed by the District for the application of irrigation water to the Project shall be the property of the District.

 

If the District terminates this Agreement, the District shall have a right to remove District Appurtenances on the Property within 30 days of written notice of its intent to terminate the Well Use Agreement.  If the District does not remove the District Appurtenances within 30 days after giving its written notice to the Property Owner of its intent to terminate this Agreement, Property Owner may request that the District remove District Appurtenances on the Property.  If the District receives such written notice, the District shall remove District Appurtenances within 30 days.  If the District fails to remove the District Appurtenances in such time, the Property Owner may do so.

 

7. Description of Well Use and Production Limit

 

The use of this Well and Well Area by the District shall be limited to the production of no more than one (1.00) acre-foot per year (AFY) of water to irrigate riparian vegetation along the banks and terraces of the Carmel River within an area defined as two thousand (2,000) feet upstream and two thousand (2,000) feet downstream of the Well location. Supply of water from the Well to the District may be interrupted by the Property Owner for good cause, without obligation to provide a substitute supply, but shall not be unreasonably withheld.

 

The use of this Well and Well Area by the Property Owner shall be limited to no more than 1.06 AFY of water for use on the portion of the Property that overlies the Carmel Valley Alluvial Aquifer, the boundaries of which are described by maps maintained by the District.  Property Owner agrees to sign and Notarize a “Notice and Deed Restriction” (provided separately) for the Property.  The Deed Restriction is for disclosure purposes and includes a copy of the March 26, 2006 District letter confirming an exemption for purchase of the Well and a February 18April 6, 2015 District letter updating the exemption to include a production limit.

 

8. Right-of-Entry

 

The District, its agents and assigns shall have a right-of-entry, together with personal property and equipment necessary to effect this Agreement, onto the Property for the purposes of installing, operating, testing, maintaining and repairing the District Appurtenances and irrigation system on the Property, subject to the following restrictions:

 

a. Except during emergencies, all maintenance and repair work shall be carried out during normal business hours from 8 a.m. to 5 p.m. on Monday through Friday. If it is necessary to carry out maintenance or repair at other times for any reason other than an emergency, the District shall obtain permission from the Property Owner to enter. The only exception to this time limit is for an emergency declared by the District Engineer during which all reasonable attempts shall be made by the District to inform the Property Owner of the need for entry onto the Property.

 

b. Entry shall be over existing roads and access onto the Property. The Property Owner reserves the right to relocate access to the Well Area.

 

9. District Irrigation Water Schedule and System Operation

 

Property Owner, together with its agents, successors, and assigns, grants to the District, and its agents, successors and assigns, the right to use water produced from the Well for irrigation of riparian vegetation along the Carmel River within the Project Irrigation System from a Well located on the Property subject to the following conditions:

 

a. Property Owner shall cooperate with the District to provide adequate volume and water pressure for the Property. The District shall have use of the Well during times when supplemental irrigation is needed as determined by the District; this shall include times when irrigation is needed to sustain riparian vegetation or erosion protection plantings in the Project area. The District’s use of irrigation water from the Well is limited only by the following restrictions: a) the use of water during any twelve (12) month period shall not exceed 1.00 acre feet in total; and b) the use of water does not impair the ability of the Property Owner to maintain a minimum of ten thousand (10,000) gallons of water in Property Owners storage tank.  .

 

b. If the Well's production falls below the needs of either the Property Owner or the District, then the District and the Property Owner shall promptly meet to identify repairs or improvements to the system which will provide adequate water for both the Project and the Property. For repairs or improvements required to meet the water needs of both parties, the District and Property Owner agree to negotiate reimbursement of a fair share of the costs of such repairs or improvements. Costs of repairs and improvements required only for needs of a single party shall be borne by that party. If the District elects not to participate in the costs of repairs or improvements needed to supply water to the District, the District shall notify the Property Owner in writing.  If the Property Owner elects not to participate in the costs of repairs or improvements needed to supply water to the Property Owner, then the Property Owner shall notify the District in writing.

 

10. Well Maintenance and Repair

 

The Property Owner shall be responsible for maintaining the Well Area, and operation, maintenance, repair restoration and replacement of the Well and appurtenances common to the operation of the District's Project Irrigation System and the Property Owner's connection. For such repairs, the Property Owner reserves the right to cause the repairs to be made or to contract for such repairs, or to discontinue use of the Well.  Responsibility for the costs of operation, improvement, maintenance, repair, restoration and replacement  of the Well shall be as specified  in Section 4 of this Agreement.

 

11. Maintenance of District Appurtenances and Project Irrigation System

 

At its discretion, the District shall be solely responsible, and the Property Owner shall have no responsibility, for the operation, improvement, maintenance, repair, restoration and replacement of the District Appurtenances and the Project Irrigation System  and the costs thereof.

 

12. Length of Agreement

 

To enable the District's option to use water to establish riparian vegetation within the Project and thereafter, and to maintain the vegetation in a healthy state during dry periods, this Agreement shall be in full force for ten (10) years, beginning with the Recordation of this Agreement.

 

The District shall have the option to extend this Agreement twoone five (5) year periods. The District, however, retains the option to terminate this Agreement at its sole discretion. The District shall provide the Property Owner with thirty (30) days prior written notification of its intent to terminate the Agreement.

 

13. Hold Harmless Agreement

 

The District shall indemnify, defend, and hold harmless the Property Owner from any and all liability which may occur as a result of the operation, maintenance and repair of the District’s Appurtenances or of the Project Irrigation System installed by the District, as described in the Agreement. In all circumstances, the effect of this offer to indemnify, defend and hold harmless under this paragraph is limited. Under no circumstances shall aggregate costs or expense incurred by the District pursuant to this indemnity provision exceed $2,000,000. This provision shall not create a presumption or inference that any future damage or loss has been caused by the District and/or its agents, contractors, inspectors, or employees during the operation, maintenance or repair of the Districts’ Appurtenances, Project irrigation system, or otherwise.

 

The Property Owner shall indemnify, defend, and hold harmless the District from any and all liability which may result from the Property Owner’s (and/or its agents, contractors, or employees) negligence or intentional conduct. 

 

14. Recordation

 

This Agreement shall be recorded in the Office of the Monterey County Recorder. All recording expenses shall be the sole responsibility of the District.

 

15. Covenant to Run with the Land

 

The parties intend this Agreement to run with the land and to be binding upon all successors in interest to the parties, without restriction, except as to term as written in the provisions for Length of Agreement.

 

16. Hazardous Materials

 

The District shall comply with all laws and regulations, including the giving of required notices, relative to the possession, storage, use, release, discharge, disposal or omission of or from the Well Area by District or District's agents and contractors or any toxic, hazardous or pollution substance (including, petroleum, crude oil and any fraction thereof) in any form whatsoever.

 

District shall provide the Property Owner with copies of any "business plan" prepared and filed by District pursuant to the requirements of Health and Safety Code Section 25500 and following, as well as any changes made thereto. District shall also promptly notify Property Owner in writing of any release or threatened release of a toxic, hazardous or polluting substance or material (including petroleum, crude oil and any fraction thereof) from or upon the Property which results from District's activities or those of District's agents or contractors or of which District otherwise becomes aware, which required reporting under Health and Safety Code 25507. To the extent arising from District's activities, District shall promptly and fully investigate, report, characterize and remediate any contamination in, on, over or under the Property Owner's Property caused by the possession, use, storage, release, discharge, disposal or emission of any toxic, hazardous or pollution substance (including petroleum, crude oil and any fraction thereof), and shall indemnify, defend, and hold Property Owner harmless from any and all loss, injury, death or damage, and all costs of all regulatory or enforcement proceedings, fines, penalties and the costs of consultants, experts, attorneys and other professionals, arising out of or as a result of the presence or claimed presence in, on over or under the Property of any toxic, hazardous or polluting substance (including petroleum, crude oil and any fraction thereof) to the extent arising from District's activities on the Property.

 

The Property Owner shall comply with all laws and regulations, including the giving of required notices, relative to the possession, storage, use, release, discharge, disposal or omission of or from the Well Area by Property Owner or Property Owner's agents and contractors of any toxic, hazardous or pollution substance (including, petroleum, crude oil and any fraction thereof) in any form whatsoever. Property Owner shall provide the District with copies of any "business plan" prepared and filed by Property Owner pursuant to the requirements of Health and Safety Code Section 25500 and following, as well as any changes made thereto. Property Owner shall also promptly notify District in writing of any release or threatened release of a toxic, hazardous or polluting substance or material (including petroleum, crude oil and any fraction thereof) from or upon the Well Area which results from Property Owner's activities or those of Property Owner's agents or contractors or of which Property Owner otherwise becomes aware, which required reporting under Health and Safety Code 25507. To the extent arising from Property Owner's activities, Property Owner shall promptly and fully investigate, report, characterize and remediate any contamination in, on, over or under the Well Area caused by the possession, use, storage, release, discharge, disposal or emission of any toxic, hazardous or pollution substance (including petroleum, crude oil and any fraction thereof), and shall indemnify, defend, and hold District harmless from any and all loss, injury, death or damage, and all costs of all regulatory or enforcement proceedings, fines, penalties and the costs of consultants, experts, attorneys and other professionals, arising out of or as a result of the presence or claimed presence in, on over or under the Well Area of any toxic, hazardous or polluting substance (including petroleum, crude oil and any fraction thereof) to the extent arising from Property Owner's activities on the Well Area.

 

17. Default/Remedies of Default

 

In the event the District fails to perform or observe any other agreements, covenants or conditions of the Agreement, on the part of District to be performed, and such failure is not cured within thirty (30) days after the date of which Property Owner gives the District written notice of default, Property Owner may then elect in addition to any other remedies that may be available to Property Owner at law or in equity to terminate this Agreement upon thirty (30) days written notice unless within such thirty (30) days, such Event of Default has been cured.

 

In the event the Property Owner fails to perform or observe any other agreements, covenants or conditions of the Agreement, on the part of Property Owner to be performed, and such failure is not cured within thirty (30) days after the date of which District gives Property Owner written notice of default, the District may then elect in addition to any other remedies that may be available to District at law or in equity to terminate this Agreement upon thirty (30) days written notice unless within such thirty (30) days, such Event of Default has been cured.

 

18. Resolution of Disputes

 

Any dispute between the Parties shall be resolved in a court of law; venue shall be in the County of Monterey.  Should any dispute arise regarding this Agreement, the prevailing party shall be entitled to its reasonable attorney fees and costs, including costs of experts.

 

19. Notices

 

Any notice or other written communication required or permitted herein shall be in writing and may be delivered personally or by express delivery service, telegram, telephonic facsimile, or by United States mail, registered or certified, postage prepaid with return receipt requested, addressed to the party for whom intended as follows:

 

 

Property Owner: Gary M. Brant & Ingrid B. Brant

                             Trustees of the Brant Family Trust

                             8720 River Meadow Road

                             Carmel, California 93940

 

 

District:                General Manager

                             Monterey Peninsula Water Management District

                             P.O. Box # 85

                             Monterey, California 93942-0085

 

 

 

Signed:            By: _______________________________ Date: _____________________

                        Trustee of the Brant Family Trust

 

 

 

 

Signed:            By: _______________________________ Date: _____________________

                        Trustee of the Brant Family Trust

 

 

 

 

 

 

Signed:            By: _______________________________ Date: _____________________

                        General Manager

                        Monterey Peninsula Water Management District

 

 

 

 

 

 

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