Final Draft ALP Marketing Supply and Demand Study

in the Fund that is not used to pay Variable OM &R costs as set forth in this
paragraph shall become part of the Fund principal.
7.03 Any funds in the Fund principal shall remain in the principal unless the Members
unanimously decide otherwise.
7.04 Variable OM &R costs for all Project participants except the City of Durango shall
be paid from the Fund to the extent such funds are available. In the event that the
annual income earned on funds in the OM &R Fund does not cover all such
Variable OM &R costs, the remaining costs shall be allocated among the Project
participants in accordance with Paragraph 8.02.
7.05 Under this document, the City of Durango will take its Project water in accordance
with Paragraph 4.04 and none of its costs will be covered by the Fund. In the event
the City of Durango agrees to take its Project water in accordance with the other
provisions of this document, i.e., to participate in the joint pool, its variable
OM &R costs shall be covered by the Fund in accordance with Paragraph 7.04.
8 Variable OM &R Costs. The Management Committee shall establish procedures for the
assessment and collection of the variable OM &R costs in excess of the costs paid pursuant
to Paragraph 7, consistent with the following principles:
8.01 Each Project participant shall be assessed its share of the projected variable OM &R
costs at least once a year and shall pay such charges within a reasonable time
period in advance of the water year.
8.02 Each Project participant shall be responsible for the actual Variable OM &R costs
for the Project water supply delivered to that Project participant.
8.03 "Variable OM &R costs" are the costs of power including energy consumption and
that share of power demand costs for the pumping of water not designated as Fixed
OM &R costs.
8.04 Variable OM &R costs attributable to a specific Project participant shall be paid for
by that Project participant.
9 Exclusions. The Association shall not be responsible for the OM &R of the Navajo Nation
Municipal Pipeline, the ALP Mitigation Area in the La Plata River Basin, or the costs
associated with those features.
10 Miscellaneous, The Parties agree to pursue as a group any administrative or judicial steps
required to assure that Project operations as set forth in this document are in conformity
with applicable law. Each Project participant has the right to make maximum beneficial
use of its respective Statutory Water Allocation so long as such use is consistent with
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