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10920090.2 - 359329 - 0154 1 <br />BIOSOLIDS SETTLEMENT AGREEMENT <br />RECITALS <br />WHEREAS, the City of Everett, a municipal corporation of the State of Washington (the <br />"City"), and Silver Lake Water & Sewer District (SLWSD), Alderwood Water & Wastewater <br />District (AWWD), and Mukilteo Water and Wastewater District (MWWD), all municipal <br />corporations of the State of Washington, (collectively, the "Districts") have entered into the <br />following agreements regarding sewage disposal (collectively, the "Contracts"): <br />District Date of Agreements <br />Alderwood Water & <br />Wastewater District December 30, 1981 <br />Mukilteo Water and <br />Wastewater District May 4, 1983 <br />Silver Lake Water & Sewer <br />District March 31, 2015 <br />WHEREAS, the City and the Districts have a dispute regarding the Districts’ <br />reimbursement obligations to the City regarding the purchase of certain agricultural property <br />for biosolids disposal (the “Marshland Property”); and <br />WHEREAS, the Districts’ position includes, but is not limited to, that they are not <br />contractually responsible for the costs associated with the purchase of Marshland Property for <br />biosolid disposal since, according to the Districts, contractually and historically, reimbursement <br />to the City for biosolid disposal has been paid as a maintenance and operations charge <br />pursuant to the respective Contracts; and <br />WHEREAS, the City’s position includes, but is not limited to, that the purchase of the <br />Marshland Property is a capital expense subject to cost sharing pursuant to the Contracts; and <br />WHEREAS, the City and Districts executed the Biosolids Tolling Agreement dated on or <br />about July 13, 2020, under which the Districts paid about half of the amounts demanded by the <br />City with respect to the Marshland Property purchase, all as follows: <br />District Amounts Paid Under Protest by Districts <br />Alderwood Water & Wastewater District $22,927.57 <br />Mukilteo Water and Wastewater District $24,786.56 <br />Silver Lake Water & Sewer District $101,253.11 <br />WHEREAS, the Districts have invoked the arbitration clause in the Biosolids Tolling <br />Agreement, but the arbitration has not yet occurred; and <br />WHEREAS, the City and Districts have determined that the costs of an arbitration