HomeMy WebLinkAboutCity of Willows MOUMEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding ("MOU") is entered into as of April 29, 2021, by and
between the City of Willows ("Willows") and the Town of Los Altos Hills ("Los Altos Hills"). Los
Altos Hills and the Willows are sometimes individually referred to herein as "Party" and
collectively as "Parties."
RECITALS
A. Electric utilities collect and annually allocate funds to communities to convert
overhead electric facilities to underground electric facilities ("Rule 20A Work Credits"). The
amount of said credits allocated by Pacific Gas and Electric Company ("PG&E") to Willows is
hereafter referred to as the "Willows Allocation."
B. Los Altos Hills has identified a qualifying project for which it would utilize
available Rule 20A Work Credits ("Project").
C. Los Altos Hills desires to purchase the entire Willows Allocation to use in
connection with their Project and Willows desires to transfer their entire Allocation to enable
the Rule 20A Credits to be used for their intended purpose of undergrounding electric facilities.
The Willows Allocation balance stands at 859,915 credits as of February 28, 2021 and is
hereafter referred to as the "Undergrounding Allocation."
AGREEMENT
NOW, THEREFORE, the Parties hereto agree as follows:
I. Willows agrees to transfer and assign its rights and interest in the Undergrounding
Allocation to Los Altos Hills and Los Altos Hills agrees to purchase the Undergrounding
Allocation in accordance with the terms of this MOU.
2. This MOU shall be subject to the approval of the Parties and shall become effective on
the date when both such approvals have been obtained (the "Effective Date").
3. Los Altos Hills shall purchase the Undergrounding Allocation at a purchase price of $0.50
per Rule 20A Work Credit.
4. Within one (1) business day of the Effective Date, Los Altos Hills shall furnish funds in
the amount of $429,957.50 ("Purchase Price") for the purchase of the Undergrounding
Allocation of 859,915 Rule 20A Work Credits. The Purchase Price shall be deposited into
an interest-bearing escrow account ("Escrow") to be opened by Willows, with interest
accruing to Willows. Subject to the provisions of this Agreement, the Purchase Price
shall constitute full consideration for the transfer and assignment of the foregoing
Undergrounding Allocation credits.
5. Within one (1) business day of the Purchase Price being deposited in Escrow, Willows
shall deliver a written request to PG&E, with a copy to Los Altos Hills, making a formal
request to transfer and assign the Undergrounding Allocation to and for the benefit of
Los Altos Hills. Willows shall cooperate in good faith with Los Altos Hills to provide any
additional documentation or information that is reasonably requested by PG&E to
complete the transfer. In the event that PG&E is unable to complete, or does not
approve, the transfer, Willows shall provide written notice to Los Altos Hills as soon as
practical thereafter of PG&E's written notification to Willows that PG&E will not
complete the transfer. Within ten (10) business days of Willows' notice, the Escrow
Agent shall return/pay the Purchase Price to Los Altos Hills from Escrow.
6. Willows shall not make or be permitted to make a draw on any amount of the Purchase
Price from Escrow until after PG&E has approved and completed the transfer of credits
and Los Altos Hills is able to utilize the credits for the qualifying Project it has identified.
In addition, in the event that any ruling, order, or action from the California Public
Utilities Commission (CPUC) applies to overrule or restrict PG&E's completion of the
transfer or the transfer of credits generally such that Los Altos Hills is not able to utilize
the credits for the qualifying Project it identified, Willows shall return any Purchase Price
funds drawn from Escrow to Los Altos Hills within ten (10) business days of the date of
the CPUC ruling, order or action. Any Purchase Price funds remaining in Escrow at such
time shall also be returned to Los Altos Hills.
7. Los Altos Hills acknowledges and agrees that it has conducted its own investigation as to
the applicability and transferability of Willows Allocation subject to this MOU for use in
the Project and that Willows has not made any representation or warranty to Los Altos
Hills with respect to same. The actual use of the Willows Allocation by Los Altos Hills
shall be subject to the rules and procedures adopted by PG&E, the California Public
Utilities Commission and such other conditions or requirements as are set forth in the
Public Utilities Code. Notwithstanding this section 7, the Parties agree that in the event
that Los Altos Hills is not able to utilize the credits for the qualifying Project due to any
determination by PG&E or the CPUC, the refund provisions set forth in Sections 5 and 6
shall continue to apply.
8. Each Party shall hold harmless, defend, and indemnify the other Party and its governing
body, officers, employees, and agents from and against any and all liability, loss,
damage, expense and costs (including without limitation costs and fees of litigation) of
every nature arising out of or in connection with the failure to comply with any of the
obligations in this MOU, except such loss or damage caused by the sole negligence or
willful misconduct of the other Party.
9. Disputes between the Parties in connection with any matter relating to the terms or
provisions of this MOU shall first be considered jointly by the City Manager of Los Altos
Hills and the City Manager for Willows. Prior to taking any judicial action to interpret or
enforce provisions of this MOU, the Parties agree to first submit the matter to a
mediator, to be mutually agreed upon by the Parties hereto, in concert with a
representative of each Party. Each Party shall pay one-half of the cost of the mediator.
However, pending resolution, the existence of any dispute will not absolve either Party
of the responsibility for timely performance of its agreed upon obligations to the other.
10. Each Party agrees to timely prepare accurate and complete financial and performance
records relating to the transactions contemplated hereunder, and to maintain and
preserve said records for at least three (3) years from the date of final payment under
this MOU, except that if any litigation, claim, negotiation, audit or other action is
pending, the records shall be retained until completion and resolution of all issues
arising therefrom.
Pursuant to California Government Code Section 8546.7, all records, documents,
conditions and activities of either Party, related to the services provided hereunder,
shall be subject to the examination and audit of the California State Auditor and other
duly authorized agents of the State of California for a period of three (3) years after final
payment under this MOU. Each Party hereby agrees to make such records available
during normal business hours for inspection, audit and reproduction by any duly
authorized agents of the State of California or the federal government. Each Party
further agrees to allow interviews of any of its employees who might reasonably have
information related to such records by any duly authorized agents of the State of
California or the federal government. All examinations and audits conducted under this
section shall be strictly confined to those matters connected with the performance of
this MOU, including the costs of administering this MOU.
11. In the event that either Party is in breach of its obligations as set forth in this MOU, then
the non -defaulting Party shall have the right to terminate this MOU on ten (10) business
day's written notice to the defaulting Party unless the default is cured within the notice
period. Upon termination for breach, the non -defaulting Party may exercise any right or
remedy which it may have under applicable law. If Los Altos Hills has made a payment
for the Purchase Price and/or an Option Price to Escrow, and the associated Rule 20A
Work Credits have not been transferred at the time this MOU is terminated, the funds in
Escrow shall be returned to Los Altos Hills within ten (10) business days of the
termination.
12. All notices to be given pursuant to this MOU shall be delivered in person, by U.S. Mail,
or by commercial overnight delivery to the address of the Party and shall be effective
upon receipt. All notices shall be sent and addressed to the representative of the Party
as set forth below. Notice may further be given by electronic means, provided,
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however, that such notice shall not be deemed effective unless it is acknowledged in
writing by the recipient of such notice.
Town of Los Altos Hills City of Willows
Attn: Carl Cahill, City Manager ; Attn: Wayne Peabody, Interim City Manager
26379 Fremont Road 201 North Lassen Street
Los Altos Hills, CA 94022 ' Willows, CA 95988
13. Willows and Los Altos Hills are independent contractors with respect to each other. This
MOU is not intended to, and shall not be construed to, create the relationship of agent,
servant, employee, partnership, joint venture, or any other similar association. Nothing
in this MOU shall be construed to create an employment relationship between Willows
and any employee of Los Altos Hills or between Los Altos Hills and any employee of
Willows. Each Party shall be solely responsible for the acts or omissions of its officers,
agents, employees, and subcontractors.
14. This MOU shall constitute the entire agreement between the Parties relating to the
subject matter of this MOU, and shall supersede any previous agreements, promises,
representations, understanding and negotiation, whether oral or written, concerning
the same subject matter.
15. This MOU shall be governed and construed in accordance with laws of the State of
California.
16. Each Party shall at its own cost and expense comply with all statutes, ordinances,
regulations and requirements of all governmental entities, including federal, state,
county or municipal, whether now in force or hereinafter enacted.
17. A waiver by either Party of any breach of any term, covenant, or conditions contained
herein shall not be deemed to be a waiver of any subsequent breach of the same or any
other term, covenant, or condition contained herein, whether of the same or a different
character.
18. The terms of this MOU shall be construed in accordance with the meaning of the
language used and shall not be construed for or against either Party by reason of the
authorship of the MOU or any other rule of construction which might otherwise apply.
No addition to, or alteration of, the terms of this MOU shall be valid unless made in
writing and signed by the Parties.
19. If any term or portion of this MOU is held to be invalid, illegal, or otherwise
unenforceable by a court of competent jurisdiction, the remaining provisions of this
MOU shall continue in full force and effect.
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20. In the event of any dispute or legal action arising under this MOU, the prevailing Party
shall not be entitled to attorney's fees.
21. This MOU may be executed by electronic means and in two or more counterparts, each
of which shall be deemed an original and all of which together shall constitute one and
the same instrument.
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IN WITNESS WHEREOF, the Parties hereby have executed this MOU as of the Effective
Date,
TOWN OF LOS ALTOS HILLS
George Tyso
Vice Mayor
APPROVED AS TO FORM:
Steve Mattas
City Attorney
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CITY OF WILLOWS
Larry DoWnighini
Mayor \
APPROVED AS TO FORM:
David Ritchie
City Attorney