CITY COUNCIL REGULAR MEETING AGENDA PACKET

4141352.1 5 the reports and proceeding to Phase II. − Environmental Review Strategy: Zone 7 will serve as the lead agency under CEQA for the feasibility study (Phase I). In that role, Zone 7 will conduct preliminary assessment of environmental compliance need for potential project alternatives for future phases. For future phase II and III, since both parties may be looking to fund portions of the Project through the Drinking Water State Revolving Fund (DWSRF), compliance with the National Environmental Policy Act (NEPA) may also be required, and parties will consider developing environmental compliance strategy in the future phases. − Zone 7 Deliverables: o Preliminary assessment of environmental compliance need for potential project alternatives for future phases − City Deliverables: o Review comments to the preliminary assessment − Draft Terms Sheet for Phase II and III: Zone 7 and the City will negotiate a Draft Terms Sheet for performing Phase II and III of the Project. The draft terms will be based on the findings of the technical feasibility review and include draft terms for the following items: 1) Scope of work and deliverables for Zone 7 as lead agency and City as supporting agency. 2) Cost sharing and payment for design and construction of groundwater facilities (currently envisioned to be proportional to facility capacity rights) 3) Cost sharing and payment for O&M of groundwater facilities (currently envisioned to be based on actual O&M costs) 4) Zone 7 guarantees and costs for supplying City GPQ until Phase II is complete and Phase III begins. 5) Land right grants to construct and operate new groundwater facilities. 6) Groundwater facilities ownership. 7) Groundwater facilities capacity rights (annual and maximum day) and ability for expansion by either party. 8) Delivery schedule of City GPQ and ability for City to go below or above GPQ on an annual basis as defined in the future operations agreement. 9) Addition of treatment technology if required to meet future water quality regulations. 10) Liability 11) Other draft terms deemed necessary by either party. − The following outlines activities by each party during Phase I that will occur outside the scope of this agreement and be the sole responsibility of each party including all associated costs and liability, except where noted: 1) Zone 7 Groundwater Modeling: Zone 7 is the Groundwater Sustainability Agency for the Livermore Valley Groundwater Basin. Upon completion of the exploratory test drilling activities under this agreement, Zone 7 will utilize its groundwater model to determine the Page 176 of 248