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03-22-2016 Mountain Star Funding Agreement2016 CAPITAL PROJECT IMPLEMENTATION AGREEMENT BETWEEN THE UPPER EAGLE REGIONAL WATER AUTHORITY, THE MOUNTAIN STAR ASSOCIATION ( "MS ") AND THE TOWN OF AVON SPECIFICALLY CONCERNING THE CONSTRUCTION OF A NEW 270,000 GALLON POTABLE WATER STORAGE AND DELIVERY TANK This Capital Project Implementation Agreement (the "Agreement") is made, effective as of March 22, 2016 (the "Effective Date ") by and between the UPPER EAGLE REGIONAL WATER AUTHORITY, a political subdivision of the State of Colorado formed by intergovernmental agreement, pursuant to C.R.S. § 29 -1 -204.2 ( "Authority "); THE MOUNTAIN STAR ASSOCIATION, a Colorado nonprofit membership corporation ( "MS "); and the TOWN OF AVON, a Colorado home rule municipality ( "Town ") and hereinafter collectively referred to as the "Parties." WHEREAS, the Parties are legally empowered under their respective organizational documents and the laws of the State of Colorado to enter into this Agreement; and WHEREAS, the Parties agree that in the overall context of the improvement and upgrade by the Authority of the potable water supply system that serves the Mountain Star Community (defined below) located in the Town and the County of Eagle, Colorado, there is a need to construct, install and make operational a new water storage and supply tank, as originally anticipated in the Water Service Mainline Extension Agreement, dated May 14, 1993, hereinafter referred to as the "Project "; and WHEREAS, the Authority has determined that the appropriate size of the new tank is 270,000 gallons; and WHEREAS, the Authority has requested the financial participation in the Project by the Town and MS as described herein; and WHEREAS, the Town and MS have agreed to additional financial terms concerning the remittance to MS of Tap Fees (as defined below) collected both in the past and in the future by the Town from properties lying within the Mountain Star subdivision, more specifically described as those properties encumbered by the Declaration of Covenants, Conditions, Restrictions and Easements for Mountain Star made the 19th day of November 1993 by Mountain Star Limited Liability Company, a Wyoming limited liability, as supplemented by the First, Second, Third, Fourth, Fifth and Sixth Supplemental Declarations thereto, all recorded in the office of the Eagle County, Colorado Clerk and Recorder's Office (the "Community "); and WHEREAS, the Authority has requested MS's funding assistance for this Project in the amount of Seven Hundred and Thirty -four Thousand Five Hundred and Nine Dollars ($734,509); and WHEREAS, the Mountain Star owners have cooperated with the Authority to implement conservation measures and have reduced overall water usage during the irrigation season of May through September by 30% over the past five years; and Capital Project Implementation Agreement FINAL March 22, 2016 Page 1 of 10 WHEREAS, based on the foregoing, MS hereby agrees to financially participate in the Project conditioned on adherence to the terms and conditions set forth herein; and WHEREAS, based on the foregoing, the Town hereby agrees to financially participate in the Project conditioned on adherence to the terms and conditions set forth herein; and WHEREAS, Authority has secured a commitment of additional funds from Mountain Star LLC in the amount of approximately $105,000 held currently by the Eagle River Water & Sanitation District as a full and final settlement of all obligations, if any, of Mountain Star LLC; and WHEREAS, the Parties have budgeted capital funding to perform their obligations under this Agreement; and WHEREAS, the Parties wish to state herein their understanding as to how the Project will be financed and implemented; NOW THEREFORE, as full consideration for and in furtherance of the goals and intents and purposes of this Agreement, the Parties hereby agree as follows: 1. Purpose. The purpose of this Agreement is to memorialize MS's agreement to fmancially participate in the Project and to establish the process by which MS's participation will be accomplished. The total eligible costs associated with the Project, include but are not limited to design, acquisition of necessary design, permitting, engineering, construction management and construction (collectively "Eligible Project Costs ") are estimated in the amount of One Million Eight Hundred Fifty Thousand Two Hundred Sixteen Dollars ($1,850,216). The Eligible Project Costs include a "Guaranteed Maximum Price" contract ( "GMP Contract ") negotiated by the Authority in the amount of One Million Five Hundred Eighty Thousand Five Hundred Twenty Six Dollars ($1,580,526) inclusive of an eight percent (8 %) contingency (the "Contingency "). The actual Eligible Project Costs expended for the Project shall be the "Actual Project Cost." Eligible Project Costs shall not include the overhead or other internal costs and expenditures of any participant. No participant will be entitled to include in -kind costs for credit or project cost purposes. 2. MS Contribution. The actual matching funds to account for dollars contributed by the Town and the Authority is initially Seven Hundred and Thirty -four Thousand Five Hundred and Nine Dollars ($734,509) to be paid directly to the Authority in accordance with Paragraph 4 and 5 of this Agreement (the "MS Contribution "). 3. Allocated Shares of Estimated Project Costs. The Estimated Project Costs and agreed upon allocated shares of the same, between the Parties and other participants, are set forth in the table below. Capital Project Implementation Agreement FINAL March 22, 2016 Page 2 of 10 The Estimated Project Costs shown in table below are based upon the GMP Contract for this Project negotiated by the Authority through an integrated project delivery process. The Estimated Project Costs are shown in Exhibit A attached hereto and incorporated herein by this reference. Participant Participant Share Authority — Exclusive of Mountain Star LLC funds held by Eagle River Water & Sanitation District ( "ERWS &D ") $135,000 ' Mountain Star LLC (currently held by ERW &SD) $105,000 Town — From Tap Fees previously collected in the Community — Inclusive of Contributions to Date $875,707 MS — Inclusive of the Contingency $734,509 Estimated Project Costs $1,850,216 If the Actual Project Cost is less than the Estimated Project Costs, then MS shall receive the entire Project savings regardless of whether from the base amount of the aforementioned contributions or from the Contingency. MS's share of the Project savings shall be paid over to MS within sixty days after the date of the final accounting for Actual Project Costs as required by Paragraph 9 below. The Authority certifies that the above sources and amounts of funds are the sole and only sources and amounts available to fund the Estimated Project Costs which are eligible for reimbursement from MS in accordance with this Agreement. The Authority acknowledges and agrees that if additional funding sources or amounts are made available to the Authority for the Project, then MS's financial commitment will be reduced, dollar for dollar, from the Eligible Project Costs amount. 4. Project Contribution Payments. The Town's and MS's obligation to fund their respective Contribution shall be contingent on the Authority entering into the GMP Contract for the completion of the Project. The Authority shall provide MS and the Town with written confirmation that the GMP Contract has been executed together with a copy of the same. Upon satisfaction of the requirements of this paragraph 4 above, the Authority, the Town and MS shall each contribute their share of the overall Estimated Project Costs as set forth in Paragraph 3. In that regard, the Authority shall deposit its share of the Project funds together with the Mountain Star LLC contribution, into an account designated for the Project, and the Town and MS shall pay to the Authority, for deposit into the same account their share of the Eligible Project Costs. The Authority shall maintain full and complete records of Actual Project Costs incurred in accordance with generally accepted accounting principles and will assure that MS shall have the right to audit the Authority's financial records related to the Project during construction of the Project and up to three (3) years after completion of the Project. Capital Project Implementation Agreement FINAL March 22, 2016 Page 3 of 10 Any change orders that would exceed the GMP Contract price shall be pursuant to and based upon changes to the GMP Contract, properly applied for and approved by the Authority's Board of Directors; provided that prior to approval of any one change order in excess of five thousand dollars ($5,000) the Authority shall provide to the MS Representative (identified in Paragraph 11B) with the application for and justification of the same. Any comments of MS promptly provided shall be considered by the Authority and given fair weight in accordance with Paragraph 7, below; provided that the final decision regarding the same shall be the Authority's to make in the exercise of its reasonable discretion. In the event that, and as and when the Actual Project Costs exceed the Estimated Project Costs, Authority may make periodic requests for additional funds from MS, no more often than every thirty days, and MS shall deposit with Authority the requested amount within five (5) business days. Except as described below as between the Town and MS, neither the Town nor Authority shall have any obligation to commit any additional funds in the event that the Actual Project Costs exceed the Estimated Project Costs. This Agreement establishes Authority's and the Town's maximum contribution toward the completion of the Project. 5. Project Implementation. Project construction shall begin on April 15, 2016 and the Authority anticipates the Project will be substantially completed on November 15, 2016 (pending delays due to inclement weather). The Authority will implement and oversee the Project, inclusive of the retention of any necessary consultants and contractors to perform the work necessary to complete the Project. The Authority shall cause the Project to be completed in accordance with the applicable laws, rules, and regulations of all governmental entities having proper jurisdiction over the Project. The Authority shall keep accurate records of the progress of the Project and the Authority shall provide status reports to the Town and MS on a regular basis (a minimum of every other month after execution of this Agreement), including progress updates, notice of any problems related to the Project and a record of the payments made to contractor(s). Said status reports shall include updates to the Actual Project Costs expended and the remaining costs projected to be expended through the Project completion, and shall note any variances (change orders) from the Estimated Project Costs, as well as any adjustments to the time schedule for Project completion. Upon completion of the Project, the Authority will add the new tank and the associated systems to the list of "Authority's Obligations" in Appendix C of the Master Service Agreement of 1998 and the 2015 Authority Agreement, and in accordance with said Agreements it shall be the sole responsibility of the Authority to operate, maintain, repair, replace, and upgrade the integrated water system serving the Community in the future. Nothing in this Agreement shall be interpreted or construed to place any financial responsibility or liability upon MS for future capital needs with respect to said system, nor any other systems or Capital Project Implementation Agreement FINAL March 22, 2016 Page 4 of 10 capital projects whether initiated by the Town, the Authority or any other provider of services within the Community. 6. Liabili . Neither the Town nor MS shall be liable for any claims, demands, losses, damages, expenses, injuries, and liabilities arising from the death or injury of any person or persons, including any claims of the Authority or other funding entities, or from any damage to or destruction of property caused by or in connection with the Project, or any negligent act or omission of the Authority, any other funding entities or the Project contractor. 7. Good Faith and Fair Dealing. The Town, MS and the Authority agree that all parties shall have a duty to each other in the performance of this Agreement which shall include, but not be limited to, the highest duties of good faith, fair dealing, disclosure of all information to each other as described herein, avoidance of conflicts of interest, and avoidance of the appearance of conflicts of interest in carrying out the goals and objectives of this Agreement. 8. Insurance. The Town, MS and the Authority shall insure themselves separately against liability, loss and damages arising out of the operation of and performance under this Agreement and the construction, use or operation of the Improvements. The Authority shall assure that the contractor selected to perform the GMP Contract retains all insurance coverages required by any law as well as those that are customary in the industry. 9. Term of Agreement and Termination. This Agreement shall be effective as of the Effective Date identified above and shall, except as set forth in Paragraph 12, below, terminate upon the completion and close out of the Project and a final accounting of the Actual Project Costs being provided by the Authority to the Town and MS. The Town and the Authority have appropriated and have on hand the funds described in this Agreement. Any party shall have the right to terminate this Agreement after thirty (30) days written notice to the other party in the event of a default which is not cured within twenty (20) days after delivery of the written notice of default. Termination shall not be effective if reasonable action to cure the breach has been taken by the defaulting party before the effective date of the termination, and such actions are pursued diligently to a successful completion within twenty (20) days from inception of the actions. If such actions are not successful within said period of time, the non - defaulting party shall have the right to terminate this Agreement upon written notice to the other parties. In the event of termination, the Authority shall settle all accounts with the Town and MS related to the Project. Capital Project Implementation Agreement FINAL March 22, 2016 Page 5 of 10 The Authority's accounting obligations, the Authority's assurance of compliance with applicable laws, the Authority's preservation of records pertaining to the Project, and the Authority's obligations and responsibility described in Paragraph 5 upon completion of the Project shall survive termination of this Agreement. The Town's obligations under Paragraph 12, below, shall survive termination of this Agreement. 10. Assignment. No Party shall have the right or power to assign this Agreement or parts thereof, or its respective duties, without the express written consent of the other Parties. Any attempt to assign this Agreement in the absence of such written consent, shall be null and void ab initio. 11. Project Management. A. Authority Representative. The Authority hereby designates: Jason Cowles (with an email address of jcowles(a-),erwsd.org ) as the Authority's representative to coordinate all communication with MS related to the Project, including issues arising under this Agreement. B. MS Representative. MS hereby designates Steve Coyer (with an email address of scoyer(a�,hotmail.com ) as MS's representative to coordinate all communication with the Authority related to the Project, including issues arising under this Agreement. C. Town Representative. The Town hereby designates: Justin Hildreth, Town Engineer (with an email address of jhildreth(a),avon.org ) as the Town's representative to coordinate all communication with the Authority related to the Project, including issues arising under this Agreement. 12. Town Tap Fee Recovery and Remittance. As further consideration for MS participating in the Total Actual Costs, for the period of twenty (20) years from the Effective Date, as and when collected via development of properties within the Community, in order to further compensate MS for its participation in the Project the Town shall pay to MS any and all Tap Fees received by the Town from builders or owners within the Community. Payment shall be made within thirty (30) days of collection. For purposes of this paragraph, "Tap Fees" shall be defined as any fee collected (1) as a condition to and for the privilege of the connection of any water service line to the water system serving the Community, and (2) as a result of a change of use of any property previously connected to the water system serving the Community. Nothing in this paragraph shall be deemed to be a limitation on the Town's legislative authority to fix or amend the Town's fees and charges assessed for the use of the water system serving the Community; provided that the Town shall (1) use its best efforts to maintain the current Tap Fee amount during the term hereof, (2) will in any event assess Tap Fees within the Community in the same manner as it assesses Capital Project Implementation Agreement FINAL March 22, 2016 Page 6 of 10 Tap Fees against similarly situated users throughout the Town, and (3) shall diligently pursue the collection of any and all Tap Fees that become due and payable under the Town's rules and regulations as they exist from time to time. Tap Fees paid the Authority directly for the water service it provides to the Community and to any applicable water service are specifically excluded from the payment obligations set forth in this Paragraph 12. Town's obligation to remit and pay to MS Tap Fees received by the Town shall expire on March 21, 2036, provided that Town shall remit to MS any Tap Fees received on or prior to March 21, 2036." 13. Release and Waiver of Claims. Upon completion of the Project, Town, Authority and MS hereby forever waive and release any claims which may be asserted by or against any of the Parties to this Agreement concerning the Water Service Mainline Extension Agreement, dated May 14, 1993, the Master Service Agreement of 1998, the 2015 Authority Agreement, and any other agreement by, between or among the Parties concerning the water system, water service and water storage tanks serving the Mountain Star Planned Unit Development in Avon, CO. This Paragraph 13 shall survive termination of this Agreement. 14. Water Conservation. MS will: (i) continue to remind the owners of, and enforce, their responsibility to comply with MS's Design Guidelines regarding irrigation practices, (ii) continue to participate in the Authority's pilot study in cutting irrigation usage, (iii) continue to encourage compliance by all owners with all water demand management regulations established system -wide by the Authority, and (iv) support the Authority's efforts to work with owners who are operating above acceptable water usage guidelines (100,000 gallons per year per SFE unless the Authority implements a different guideline across its entire system) in order to establish new irrigation practices that will bring the specific usage into an acceptable range. 15. Miscellaneous. It is the intention of the Parties that the Authority shall be, and remain, an independent contractor. The Parties do not intend and nothing contained in this Agreement shall be deemed to create a partnership, co- tenancy, joint venture or agency of any kind. Any Party in default under this Agreement shall pay the reasonable attorney's fees of the other party incurred in order to enforce its rights under this Agreement. This Agreement shall be construed in accordance with the laws of the State of Colorado. In the event of any dispute between the parties to this Agreement, the exclusive venue for dispute resolution shall be the District Court for and in Eagle County, Colorado. This Agreement shall inure to the benefit of, and be binding upon the parties to this Agreement and their respective successors and permitted assigns. This Agreement is solely between and for the benefit of the Town, MS and the Authority, and no design consultant, contractor, any subcontractor nor any other person is a third -party beneficiary to or under this Agreement. This Agreement contains the entire agreement of the Parties with respect to its subject matter. Any amendments or modifications to this Agreement must be in writing executed by the Parties in order to be valid and binding. Each Party to this Agreement Capital Project Implementation Agreement FINAL March 22, 2016 Page 7 of 10 represents and warrants that they have made full disclosure of any and all contingencies, conditions, or reimbursement agreements related to their financial participation in the Project as described in Paragraph 3 above. No waiver of any of the provisions of this Agreement shall be deemed to constitute a waiver of any other of the provisions of this Agreement, nor shall such waiver constitute a continuing waiver unless otherwise expressly provided herein, nor shall the waiver of any default hereunder be deemed a waiver of any subsequent default hereunder. The Town and the Authority are political subdivisions of the State of Colorado and, as such, (1) with the exception of Avon's obligation to pay Tap Fees to MS as described in Paragraph 12 above which shall be considered a special fund obligation of the Town, any and all financial obligations described hereunder are subject to annual budget and appropriations requirements, and (2) no consultants, contractors or subcontractors shall have lien rights against the Parties, nor against any property lying within the boundaries of the Parties in the event of nonpayment of any amount due under this Agreement. The Town and the Authority and their respective elected officials, directors, officials, officers, agents and employees are relying upon and do not waive or abrogate, or intend to waive or abrogate by any provision of this Agreement the monetary limitations or any other rights immunities or protections afforded by the Colorado Governmental Immunity Act, § §24- 10 -101 et seq., C.R.S., as the same may be amended from time to time. No elected official, director, officer, agent or employee of the Town, MS or the Authority shall be charged personally or held contractually liable under any term or provision of this Agreement, or because of any breach thereof or because of its or their execution, approval or attempted execution of this Agreement. From and after the Effective Date, MS shall use its best efforts to promote and encourage compliance of its members with any and all duly adopted and generally applicable Authority rules and regulations including without limitation those applicable to irrigation within the Community. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and together shall constitute one and the same instrument. [EXECUTION PAGE FOLLOWS] Capital Project Implementation Agreement FINAL March 22, 2016 Page 8 of 10 IN WITNESS WHEREOF, the Parties have executed this Capital Project Implementation Agreement as of the day and year first above written. T WN OF AVON AUTHORITY — UPPER EAGLE REGIONAL WATER AUTHORITY THE OUNTAIN STAR ASSOCIATION Capital Project Implementation Agreement FINAL, March 22, 2016 Page 9 of 10 EXHIBIT A Mountain Star Water Storage Tank 60% Design Budget Estimate February 9, 2018 Design & Permitting Budget Alpine Engineering (Civil Engineering) $ 51,500 SGM (Structural Engineering) $ 50,080 Eagle Valley Surveying (Surveying and Platting) $ 10,180 Michael West & Associates (Geotechnical Engineering) $ 9,760 Russ Sasakura Engineering (Instrumentation & Controls) $ 6,000 Aslan Construction (Pre- Construction Services) $ 25,000 Subtotal Design Budget $ 152,520 Construction Budget Alpine Engineering (Construction Engineering) $ 24,000 SGM, Inc. (Construction Engineering) $ 33,170 Geotechnical Engineering (Materials Testing - QA/QC) $ 30,000 Holy Cross Electric (Purchase of Electric Materials) $ 30,000 270,000 gallon Water Storage Tank and All Appurtenances $ 1,463,450 Construction Contingency (8 %) $ 117,076 Subtotal Construction Budget $ 1,697,696 Total Proposed Project Budget (Design + Construction Subtotals) $ 1,850,216 Revenues Mountain Star Tap Fees $ 875,707 Authority Contribution $ 135,000 Mountain Star LLC Contribution $ 105,000 Subtotal Revenues $ 1,115,707 Requested Contribution from Mountain Star HOA $ 734,509 Notes: 1. Water Tank Construction costs based on 60% design estimate provided by Aslan Construction. 2. 8% Contingency included in Aslan GMP proposal for potential construction cost overruns and design changes. Capital Project Implementation Agreement FINAL — Exhibit A March 22, 2016 Page 10 of 10