D~z2~3/ /~ COMMISSIONERS' COURT AGENDA REQUEST PLEASE FURNISH ONE ORIGINAL AND NINE COPIES OF THIS REQUEST AND DOCUMENTS TO BE REVIEWED BY THE COURT. MADE B onathan Letz OFFICE: Commissioners Court MEETING DATE: September 22, 2003 TIlVIE PREFERRED: SUBJECT: (PLEASE BE SPECIFIC) Discuss draft of new contract for OSSF administration between UGRA and Kerr County. EXECUTIVE SESSION REQUESTED: (PLEASE STATE REASON) NAME OF PERSON ADDRESSING THE COURT: ESTIMATED LENGTH OF PRESENTATION: IF PERSONNEL MATTER -NAME OF EMPLOYEE: Commissioner Pct. #3 Time for submitting this request for Court to assure that the matter is posted in accordance with Title 5, Chapter 551 and 552, Government Code, is as follows: Meeting scheduled for Mondays: THIS REQUEST RECEIVED BY: THIS REQUEST RECEIVED ON: All Agenda Requests will be screened by the County Judge's Office to determine if adequate information has been prepared for the Court's formal consideration and action at time of Court Meetings. Your cooperation will be appreciated and contribute towards you request being addressed at the earliest opportunity. See Agenda Request Rules Adopted by Commissioners' Court. 5:00 P.M. previous Tuesday. September 16, 2003 Attached is a draft contract between UGRA and Ken County for the administration of the OSSF Program. This draft was prepared by UGRA and is being provided for information purposes. Jonathan Letz ~~ Draft #2 8/19/03 INTERLOCAL AGREEMENT FOR ADMINISTRATION OF KERB COUNTY OSSF PROGRAM STATE OF TEXAS § COUNTY OF KERB § This Interlocal Agreement For Administration of Kerr County OSSF Program ("Agreement") is made and entered into as of this day of , 2003, pursuant to the Interlocal Cooperation Act, as codified at Chapter 791 of the Texas Government Code, by and between Kerr County, hereinafter called the "County", and the Upper Guadalupe River Authority, hereinafter called "UGRA", for the purpose of performing certain governmental functions and services relating to the regulation of on-site sewage systems in Kerr County, Texas. Recitals WHEREAS, it is the public policy of the State of Texas to eliminate and prevent health hazards by regulating and properly planning the location, design, construction, installation, operation, and maintenance of on-site sewage facilities; WHEREAS, Texas Health & Safety Code, Chapter 366, Subchapter C, authorizes the Texas Commission on Environmental Quality ("TCEQ") to designate a local governmental entity, including a municipality, county or river authority, as an authorized agent of the TCEQ to implement and enforce rules relating to the regulation of on-site sewage disposal facilities; WHEREAS, by Order dated ,the predecessor agency to TCEQ designated UGRA as an authorized agent to implement Texas Health & Safety Code, Chapter 366, and the rules promulgated by TCEQ in connection therewith, as set forth at 30 TAC Chapter 285, within a certain geographical area generally consisting of the lands located within 1500 feet of forty (40) creeks located in Kerr County, Texas; WHEREAS, by Order dated ,the predecessor agency to TCEQ designated the County as an authorized agent to implement Texas Health & Safety Code, Chapter 366, and the rules promulgated by TCEQ in connection therewith, as set forth at 30 TAC Chapter 285, within a certain geographical area generally consisting of the lands within Ken County, Texas not otherwise subject to regulation by another authorized agent; WHEREAS, both the County and UGRA have adopted programs to regulate on-site sewage facilities in the areas of their respective jurisdictions. A copy of the County's on-site sewage facilities program rules and regulations (the "County OSSF Program") and UGRA's on- site sewage facilities program rules and regulations (the "UG1ZA OSSF Program") are attached hereto as Exhibit "A" and Exhibit "B", respectively; WHEREAS, Chapter 791 of the Texas Government Code authorizes a local government to contract or agree with another local government to perform governmental functions and services, including those relating to waste disposal; WHEREAS, UGRA has offered to utilize its staff and resources to administer the County OSSF program; and WHEREAS, in order to increase the efficiency and effectiveness of local government, to minimize costs to taxpayers, and to protect water quality and the health and safety of persons within Ken County, UGRA and the County mutually desire to enter into this Interlocal Agreement setting forth the terms and conditions pursuant to which UGRA will administer the County's OSSF program for and on behalf of the County. NOW, THEREFORE, for and in consideration of the mutual covenants and agreements hereafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, UGRA and the County hereby agree as follows. ARTICLE I DEFINITIONS 1.1. "County OSSF Program" means those certain rules and regulations adopted by the County regulating OSSFs within the County Jurisdiction Area, a copy of which is attached hereto as Exhibit "A". 1.2. "County Jurisdiction Area" means the geographical area within Kerr County that is subject to the County OSSF Order, as provided in TCEQ's order approving the County OSSF Program. The County Jurisdiction Area generally includes all areas within Kerr County that are not located within an incorporated municipality or within the jurisdiction of another OSSF authorized agent approved by TCEQ. 1.3. "General Manager" as that term is used in this Agreement means the General Manager of the UG1tA, his staff, agents, consultants and other authorized representatives that administer the County OSSF Program in accordance with the terms of this Agreement. 1.4. "OSSF" means on-site sewage facility, defined as one or more systems of treatment devices and disposal facilities that produce not more than 5,000 gallons of waste each day and that are used only for disposal of sewage produced on a site on which any part of the system is located. 1.5. "UGRA OSSF Program" means those certain rules and regulations adopted by UGRA regulating OSSFs within the UGRA Jurisdiction Area, a copy of which is attached hereto as Exhibit "B". 1.6. "UGRA Jurisdiction Area" means the geographical area within Kerr County that is subject to the UGRA OSSF Program, as provided in TCEQ's order approving the UGRA OSSF Program. The UGRA Jurisdiction Area generally includes the lands located within 1500 feet of fifty-three (53) creeks and streams located within Kerr County, Texas. ARTICLE II AREAS OF JURISDICTION 2.1 County Jurisdiction. UGRA shall administer the County OSSF Progam in the County Jurisdiction Area under the terms and conditions set forth in this Agreement. 2 2.2 UGRA Jurisdiction. UGRA shall administer the UGRA OSSF Program in the UGRA Jurisdiction Area. The parties acknowledge and agree that this Agreement relates only to UGRA's administration of the County OSSF Program, and does not affect UGRA's administration of the UGRA OSSF Program. 2.3 Overlapping Jurisdiction. In the event that any OSSF is located within real property, a portion of which is located within the County Jurisdiction Area and a portion of which is located within the UGRA Jurisdiction Area, then UGRA shall use its best efforts to determine whether the OSSF treatment system and disposal facilities are located within the County Jurisdiction Area or the UGRA Jurisdiction Area, and shall administer the appropriate OSSF program accordingly. The parties agree that UGRA shall be responsible for making jurisdictional determinations under this Agreement. ARTICLE III CONTRACTED SERVICES 3.1. General. During the term of this Agreement, UGRA agrees to administer in all respects the County OSSF Program for and on behalf of the County. The services to be performed by UGRA under this Agreement include all aspects of the permitting, planning, construction, operation, and maintenance of OSSF systems within the County Jurisdiction Area in accordance with the applicable provisions of the County OSSF Program, and the rules and regulations of TCEQ. 3.2. Specific Services. The services and functions to be performed by UGRA under this Agreement include, but shall not be limited to, the following: (a) Application Forms. UGRA agrees to maintain and distribute application forms for authorization to construct and operate an OSSF in accordance with the County OSSF Program. (b) Review of Application Forms and Planning Materials. UGRA agrees to accept and review application forms for authorization to construct an OSSF. In connection with the receipt of an application, UGRA shall also require submission of all applicable planning materials, site evaluation results, maintenance contracts, and variance requests in accordance with the County OSSF Program. UGRA shall review all submission materials for compliance with the County OSSF Program, and to determine whether the proposed OSSF may be located in federal floodplain areas. UGRA shall issue a declaration of completeness, identify deficiencies, or issue variances, based on the application, site conditions, and the applicable provisions of the County OSSF Program. (c) Fee Processing. UGRA shall levy and collect all fees related to the administration and operation of the County OSSF Program, including a permit fee for the construction, installation, alteration, repair, or extension of OSSF's, and a fee for the testing, design, and inspection of OSSF systems. All fees shall be in the amounts established by the County from time to time. UGRA shall retain all fees as payment for services rendered by UGRA under this Agreement, as more particularly set forth in Article V below. UGRA further agrees to collect and remit to third parties any fees that may be required under the laws of the State of Texas (including by way of example and not in limitation, any remittance to the On-Site Wastewater Treatment Research Council). (d) Site Inspection. UGRA shall perform all site evaluation, construction inspection, and other site inspections required to administer the County OSSF Program. UGRA shall schedule construction inspections in accordance with the timeframes required by TCEQ. If an OSSF does not pass construction inspection, UGRA shall advise the owner or the owner's agent of the deficiencies, and timely issue a letter to the owner listing the deficiencies and stating that the OSSF cannot be used until it passes inspection. UGRA shall also conduct all required reinspections. UGRA shall issue a written notice of approval for OSSFs that pass the construction inspection. (e) Issuance of Permits. UGRA shall issue permits and licenses for authorization to construct and operate an OSSF within the County in accordance with the requirements set forth in the County OSSF Program. (f) Subdivision Plat Review. UGRA agrees to review subdivision plat applications for compliance with the County OSSF Program. (g} Malfunctioning S, std s. UGRA may require property owners to repair malfunctioning OSSF systems. (h) Complaint Resolution. UGRA shall timely investigate all complaints relating to OSSFs for and on behalf of the County, and take appropriate and timely action in response thereto. In the event that UGRA determines that formal enforcement action is appropriate, it will refer such matter to the County for enforcement in accordance with Section 3.5 below. (i) Reporting. UGRA shall prepare and submit monthly and annual activity reports concerning the status of the County OSSF Program and submit such reports to TCEQ as required by 30 TAC Chapter 285. A copy of all such reports filed with TCEQ will be furnished to the County. (j) TCEQ Annual Inspection. UGRA agrees to cooperate and provide such information as may be available relating to its administration of the OSSF Program in connection with TCEQ's annual inspection of the County OSSF Program. If TCEQ identifies any program deficiencies that relate to UGRA's administration of the program, UGRA shall implement such corrective measures as it deems necessary to address the deficiency. If any such deficiency relates to the County OSSF Program, then the County shall be responsible for corrective action. 3.3. Scope of UGRA Authority. As more fully set forth in Article VIII below, UGRA is acting as an independent contractor and shall have sole and complete authority and discretion to administer the County OSSF Program under and in accordance with the terms of this Agreement. 3.4. Licenses and Registrations. UGRA shall be solely responsible for obtaining any necessary licenses and registrations, and otherwise complying with any applicable federal, state, and municipal laws, codes and regulations, necessary for UGRA to administer the County OSSF Program in accordance with the terms of this Agreement. 4 3.5. Formal Enforcement. UGRA shall endeavor to enforce the County OSSF Program through the permitting process and negotiations with landowners. However, it is mutually agreed by UGRA and the County that UGRA shall have no responsibility for the initiation or prosecution of formal enforcement action with respect to the County OSSF Program, including the levy of penalties or commencement of judicial proceedings. In the event that UGRA determines that enforcement action is necessary or appropriate in connection with any OSSF, or any other matter that comes to UGRA's attention related to sewage disposal within the County Jurisdiction Area, then UGRA shall refer such matter, with supporting evidence (if any), to the County for further action. The County shall have sole discretion in determining whether to levy penalties, commence judicial proceedings, or pursue such other remedies which may be available under the laws of the State of Texas. UGRA agrees to cooperate with respect to any enforcement action taken by the County, and the County agrees to use good faith efforts to seek to recover any costs or expenses incurred by UGRA in connection therewith. ARTICLE IV COUNTY OBLIGATIONS 4.1 Cooperation. The County agrees to reasonably cooperate and assist UGRA in connection with the services and functions to be performed by UGRA under this Agreement. 4.2 Information Relating to New OSSF S std ems. The County agrees to timely forward to UGRA, or otherwise make available to UGRA, a copy of each list of addresses within the County Jurisdiction Area at which the local electric utility has made new electric service connections that is received by the County under Section 366.005 of the Texas Health & Safety Code. UGRA shall utilize the list for the purpose of administering the County OSSF Program, and for no other purpose, and shall keep such information confidential in accordance with applicable law. 4.3 Pa,~. County agrees to provide payment to UGRA for administration of the County OSSF Program in accordance with Article V below. When requested by UGRA, the County agrees both to consider UGRA proposals for adjustment of County OSSF Program fees, and to act to accept, modify or deny such requests, within sixty (60) days following receipt of such request. 4.4 Revisions to OSSF Program. In the event that the County proposes to adopt any substantive revision to the County OSSF Program or fee structure related thereto during the term of this Agreement (or any renewal term), other than those that may be required by TCEQ, requested by UGRA, or required by an emergency, the County shall provide notice of the proposed revision to UGRA on or before April 30 of such year, and such revision shall be adopted to become effective the following October 1, the date of commencement of UGRA's fiscal year. The County shall be solely responsible for any costs or expenses incurred in connection with any such program revisions, including the costs of any experts or consultants that may provide technical assistance to the County. 4.5 TCEQ Approval. County agrees to take such actions as may be necessary from time to time to maintain the County OSSF Program in full operation and effect during the term of this Agreement. County acknowledges and agrees that UGRA shall have no obligation to administer, and shall not administer, any portion of the County OSSF Program that has not been approved by TCEQ. 4.6 Committees. The County agrees to allow UGRA to form vazious advisory boazds and/or standing or ad hoc committees it deems necessary to assist with the effective and efficient delivery of the services set out herein, and UGRA shall give the County the option of appointing one of its officers or agents to sit on any such board or committee. The County shall be under no obligation to adopt or implement any recommendations of the advisory board or committee. 4.7 Enforcement. The County agrees to accept for possible enforcement action all alleged violations of the County OSSF Program and the UGRA OSSF Program referred to the County by UGRA after UGRA has exhausted all efforts to resolve the alleged violations by administrative channels or by negotiation. The County shall have sole discretion in determining whether to pursue enforcement action, levy penalties, commence judicial proceedings, or pursue such other remedies that may be available under the laws of the State of Texas in connection with the prosecution of any such enforcement matters. With respect to any alleged violations of the UGRA OSSF Program, the County agrees to respond to any request by UGRA for enforcement within ten (10) days of receipt of the request. In the event that the County chooses to not pursue enforcement action in connection with any such alleged violation, then UGRA may, but shall not be required to, pursue enforcement in connection therewith. UGRA agrees to cooperate with respect to any enforcement action taken by the County, and the County agrees to use good faith efforts to seek to recover any costs or expenses incurred by UGRA in connection therewith. ARTICLE V. PAYMENT OF COSTS 5.1. Program Fees. In order for the County to compensate UGRA for its costs of administration of the County OSSF Program during the term of this Agreement, the County hereby authorizes UGRA to retain, as partial compensation for UGRA's administration of the County OSSF Program, all fees collected by UGRA in accordance with the County OSSF Program. 5.2 Annual Payment by County (a) Upon execution of this Agreement by both parties and prior to the commencement of services by UGRA, the County agrees to pay to UGRA the sum of $52,000 for administration of the County OSSF Program during the first year of this Agreement. The parties agree that this sum represents the estimated costs to be incurred by UGRA for administration of the County OSSF Program after collection of County OSSF Program fees (the "Projected Program Deficit"). The Projected Program Deficit has been calculated based on UGRA's initial budget for administration of the County OSSF Program (the "Program Budget"), a copy of which budget is attached hereto as Exhibit "C". The parties acknowledge and agree that all cost and expense categories and projections within the Program Budget relate to administration of the County OSSF Program and are reasonable. 6 (b) At the conclusion of each year that this Agreement remains in effect, UGRA shall perform an accounting and ascertain the total costs and expenses incurred by UGRA in connection with the administration of the County OSSF Program during the preceding year, along with an accounting of all County OSSF Program fees and revenues collected and retained by UGRA during the year. In the event that any costs or expenses incurred by UGRA relate to administration of both the UGRA OSSF Program and the County OSSF Program, then UGRA shall allocate said costs and expenses between the programs on a pro rata basis (based on the number of applications and complaint investigations in each respective jurisdictional area, or any other reasonable basis for apportionment determined by UGRA). UGRA shall furnish a copy of such accounting to the County within forty-five (45) days of the end of UGRA's fiscal year. The County or UGRA, as applicable, shall provide payment of the underpayment or overpayment to the other party within thirty (30) days after completion of the accounting. In the event of renewal of this Agreement, then the parties may agree, in lieu of payment, that the overpayment or underpayment will be credited or debited against the County's obligation to pay the Projected Program Deficit for the subsequent year, as provided below. The parties agree that the costs and expenses incurred by UGRA in connection with the annual accounting and preparation of the Program Budget and Projected Program Deficit relate to administration of the County OSSF Program and may be included within the Program Budget for purposes of recovering UGRA's costs of administration. (c) During each year that this Agreement remains in effect, UGRA shall prepare a Program Budget for administration of the County OSSF Program during the subsequent year, along with the Projected Program Deficit for such fiscal year. UGRA shall furnish such information to the County on or before August 1. The County shall review the Program Budget and approve or deny payment of the Projected Program Deficit prior to September 1. In the event that the County fails to deliver written approval of payment to UGRA by September 15, then this Agreement shall terminate without further action by either party. In the event that the County approves payment of the Projected Program Deficit, then it shall pay UGRA said amount prior to commencement of the next term of the Agreement (i.e., prior to October 1). 5.3 Source of Payment. The parties agree that all payment to be made hereunder by either party to the other shall be made from current revenues available to the paying party. 5.4 Fair Compensation. The parties agree that the payment methodology provided for in this Agreement fairly compensates UGRA for the services and functions performed under this Agreement. 5.5 Annual Audit. During each year that this Agreement remains in effect, UGRA agrees to include within the scope of its annual operations audit, performed by an independent accounting firm, a review of UGRA's administration of the County OSSF Program. UGRA will furnish ten (10) copies of the OSSF Program audit to the County within ten (10) days following acceptance of the audit by the UGRA Board of Directors. 7 ARTICLE VI. LIABILITY, BREACH AND INDEMNIFICATION 6.1 General. In accordance with Section 366.003 of the Texas Health & Safety Code, the County acknowledges and agrees that no authorized agent shall be held responsible for damages resulting from the authorized agent's approval of the installation or operation of an OSSF. Accordingly, the parties agree that neither UGRA nor the County shall be responsible for any damages resulting from UGRA's approval of the installation or operation of an OSSF under the County OSSF Program. 6.2 Indemnification. (a) Indemnification by County. To the extent allowed by law, the County agrees to be solely responsible for all claims, causes of action, costs, damages, liabilities, demands, suits, or obligations of third parties (including, without limitation, court costs and reasonable attorneys= fees) incurred by it or UGRA which results from the UGRA's administration of the County OSSF Program. Accordingly, to the extent authorized under Texas law, the County agrees to protect, indemnify, defend and hold UGRA and its directors, officers, employees, agents and representatives (collectively, the "Indemnified Persons") free and harmless from and against any and all liabilities, losses, damages, costs, claims, expenses, demands and causes of action of every kind and character occurring or anywise incident to, in connection with, or arising out of, UGRA's administration of the County OSSF Program, and the amounts of judgments, fines, penalties, interest, court costs and legal fees incurred by any of the Indemnified Persons as a result thereof, whether or not caused or contributed by the negligence of the Indemnified Persons. This indemnity shall survive the termination of this Agreement and shall be binding upon and inure to the benefit of the parties hereto and their respective successors, representatives and assigns. The parties agree that the foregoing indemnification agreement shall not be construed or interpreted to relinquish or waive any rights of governmental immunity that the County may assert with respect to any claims brought by third parties. (b) Indemnification by UGRA. To the extent allowed by law, UGRA agrees to be solely responsible for all claims, causes of action, costs, damages, liabilities, demands, suits, or obligations of third parties (including, without limitation, court costs and reasonable attorneys= fees) incurred by it or the County which results from the UGRA OSSF Program. Accordingly, to the extent authorized under Texas law, UGRA agrees to protect, indemnify, defend and hold the County and its directors, officers, employees, agents and representatives (collectively, the "County Indemnified Persons") free and harmless from and against any and all liabilities, losses, damages, costs, claims, expenses, demands and causes of action of every kind and character occurring or anywise incident to, in connection with, or arising out of, the UGRA OSSF Program, and the amounts of judgments, fines, penalties, interest, court costs and legal fees incurred by any of the County Indemnified Persons as a result thereof, whether or not caused or contributed by the negligence of the County Indemnified Persons. This indemnity shall survive the termination of this Agreement and shall be binding upon and inure to the benefit of the parties hereto and their respective successors, representatives and assigns. The parties agree that the foregoing indemnification agreement shall not be construed or interpreted to 8 relinquish or waive any rights of governmental immunity that UGRA may assert with respect to any claims brought by third parties. 6.3 Remedies. After providing notice and an opportunity to cure in accordance with Section 6.4 below, the Parties shall have the right to request any court, agency or other governmental authority of appropriate jurisdiction to grant any and all remedies which are appropriate to assure conformance to the provisions of this Agreement. The defaulting party shall be liable to the other for all costs actually incurred in pursuing such remedies, including reasonable attorney's fees, and for any penalties, fines, or costs as a result of the failure to comply with the terms. 6.4 Notice and Opportunity to Cure. If either party (referred to herein as the "Defaulting Party") fails to comply with its obligations under this Agreement or is otherwise in breach or default under this Agreement (collectively, a "Default") then the other party (referred to herein as the "Non-Defaulting Party") may not invoke any rights or remedies with respect to the Default until and unless: (i) the Non-Defaulting Party delivers to the Defaulting Party a written notice (the "Default Notice") which specifies all of the particulars of the Default and specifies the actions necessary to cure the Default; and (ii) the Defaulting Party fails to cure, within ten (10) days after the Defaulting Party's receipt of the Default Notice, any matters specified in the Default Notice which may be cured solely by the payment of money or the Defaulting Party fails to commence the cure of any matters specified in the Default Notice which cannot be cured solely by the payment of money within a reasonable period of time after the Defaulting Party's receipt of the Default Notice or fails to thereafter pursue curative action with reasonable diligence to completion. ARTICLE VII APPEALS 7.1 Appeals. It is the parties' mutual intention that UGRA shall have administer the County OSSF Program as an independent contractor without interference or input from any other party, person, or authority. Individual members of the Kerr County Commissioners Court, their agents and employees shall refer all questions and matters that come to their attention to the UGRA General Manager, and members of the Court shall use their influence and good will to encourage all applicants and permittees to resolve the issue with the General Manager, when possible. In the event that UGRA is not able to resolve a dispute or impasse concerning its administration of the County OSSF Program, however, then either UGRA, or an affected person (e.g., a landowner or landowner's representative) may appeal such dispute or impasse to the County by providing written notice thereof to the County. The County shall provide a copy of any such notice to UGRA in the event an appeal is filed by a person other than UGRA. Upon receipt of an appeal, the County Commissioners Court will schedule the appeal for consideration and action as promptly as possible. Upon consideration and except as otherwise agreed by the parties, the Ken County Commissioners Court will assume full responsibility for the OSSF application or facility that is the subject of the appeal in accordance with the terms of the County OSSF Program. 9 ARTICLE VIII. INDEPENDENT CONTRACTOR 8.1 Independent Contractor. In the performance of its obligations hereunder, UGRA is an independent contractor with the exclusive right to administer, operate and evaluate the performance of the County OSSF Program. The County shall look to the UGRA for results only and shall not have the right at any time to direct or supervise UGRA, the General Manager or any of the UGRA personnel, agents, employees or professional and/or technical consultants employed or retained by UGRA on the delivery of the services as set out herein or as to the manner, means or methodology in which the services are performed. Nothing in this Agreement will be construed to constitute either Party as a partner, employee or agent of the other party, nor will either party have the authority to bind the other in any respect. Each party will remain an independent contractor responsible for its own actions except as otherwise specifically provided herein. ARTICLE IX. TERM/TERMINATION 9.1 Initial Term. The initial term of this Agreement shall be from October 1, 2003 through September 30, 2004. 9.2 Renewal. Except as otherwise provided by the terms hereof, this Agreement shall be renewed automatically, without action by any party hereto, for five (5) successive periods of one (l) year each, commencing on the first day of October, 2004, and the first day of every subsequent October through October 1, 2008, unless written notice of cancellation is given by either party hereto not later than May 31 during any term of this Agreement. In the event of delivery of notice of cancellation, then this Agreement shall terminate on September 30 of the year in which notice of cancellation was delivered to the other party, notwithstanding any statement to the contrary in the notice of cancellation. ARTICLE X GENERAL CONDITIONS 10.1 Force Majeure. In the event that any party is rendered unable, wholly or in part, to perform any of its obligations under this Agreement (by reason of failure or national moratorium of operation of the banks, transfer agents, brokers, stock exchanges or modes of transportation; or work stoppages or restraint by court order or other public authority; or action or inaction concerning governmental or regulatory authorizations; or transportation delay; or death or personal injury of a representative of a party whose signature is necessary, or other similar events of force majeure), upon the provision of written notice which fully relates the particulars of the claimed force majeure, including but not limited to the dates on which it commenced and ceased or is expected to cease by the party claiming force majeure to the other party as soon as is reasonably practicable after the occurrence of the cause relied upon, the obligations of the party claiming force 10 majeure, to the extent they are affected by the force majeure, shall be suspended during the continuance of any inability of performance so caused. This Agreement shall not be terminated by reason of any such cause but shall remain in full force and effect. Any party rendered unable to fulfill any of its obligations under this Agreement by reason of force majeure shall exercise the utmost diligence to remove such inability. The suspension of obligations of a party to this Agreement pursuant to this section shall be added to the time specified in other provisions of this Agreement for the purpose of calculating the date on which certain conditions of this Agreement are to be satisfied. 10.2 Modification. This Agreement shall be subject to change or modification only with the mutual written consent of the parties. 10.3 Captions. The captions appearing at the first of each numbered section or paragraph in this Agreement are included solely for convenience and shall never be considered or given any effect in construing this Agreement. 10.4 Severability. The provisions of this Agreement are severable, and if any provision or part of this Agreement shall ever be held by any court of competent jurisdiction to be invalid or unconstitutional for any reason, the remainder of this Agreement and the application of such provision or part of this Agreement to other persons or circumstances shall not be affected thereby. 10.5 Cooperation. Each party hereby agrees that it will take all actions necessary to fully carry out the purposes and intent of this Agreement. 10.6 Addresses and Notice. All notices hereunder from UGRA to the County will be sufficient if sent by certified mail, hand delivery, or facsimile transmission with confirmation of delivery, addressed to the County at the following address: Fax: All notices from the County to UGRA will be sufficiently given if sent by certified mail, hand delivery, or facsimile transmission with confirmation of delivery to UGRA at the following address: Fax: 10.7 Assignability. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns; provided, however, that neither party may assign any of their respective rights nor delegate any of their respective duties hereunder without the other party's prior written consent. 10.8 Interpretation. Terms not otherwise defined in this Agreement shall have the meanings set forth in Texas Health & Safety Code, Chapter 366, and the rules promulgated by TCEQ in connection therewith, as set forth at 30 TAC Chapter 285. 11 10.9 Sole Agreement. This Agreement constitutes the sole and only agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties with respect to the subject matter hereof. 10.10 Delays. No delay or failure by either party hereto to exercise any right, power or remedy, under this Agreement, and no partial or single exercise of that right, power or remedy, shall constitute a waiver of that or any other right, power or remedy unless otherwise expressly provided herein. No waiver shall be deemed to have been made unless it is in writing and signed by the waiving party. 10.11 Applicable law. This Agreement is deemed to have been made in and to be performable in the State of Texas, and shall be construed in accordance with and governed by the laws of the State of Texas. 10.12 Execution. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 10.13 Authorship. This Agreement or any portion thereof shall not be interpreted by a court of law to the detriment of a party based solely upon that party's authorship of the Agreement or any portion thereof. 10.14 Authorization. The Parties each certify that it has the legal authority to enter into this Agreement. 12 APPROVED AND ORDERED by the Commissioners Court of Kerr County this day of .2003. COUNTY OF KERB By: County Judge ATTEST: County Clerk APPROVED AND ADOPTED by the Upper Guadalupe River Authority Board of Directors this day of , 2003. UPPER GUADALUPE RIVER AUTHORITY By: President ATTEST: Secretary 13