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3. For calendar year 2008, the PARTICIPATING AGENCIES have entered into a separate agreement for <br /> payment of their pro rata share per project of federal advocacy costs. <br /> VII. DISTRIBUTION OF FEDERAL FUNDING <br /> 1. PARTICIPATING AGENCIES designate BACWA to serve as the legal entity to request amendments <br /> to the Reclamation Wastewater and Groundwater Study and Facilities Act of 1992 for the <br /> authorized projects. <br /> 2. When a federal appropriation is made, in accordance with the Final Appropriation List, BACWA <br /> shall inform the United States Bureau of Reclamation (USER) of the percentage share that each <br /> PARTICIPATING AGENCY should receive for its project(s) from the appropriation pursuant to an <br /> individual project agreement(s) between the PARTICIPATING AGENCY and USBR. Should the total <br /> amount of the federal appropriation be less than the total amount sought for all authorized <br /> projects in any given year, each PARTICIPATING AGENCY will receive its percentage share of the <br /> lower appropriation, and BACWA shall inform USBR of the percentage shares. <br /> 3. BACWA shall have no responsibility and no liability for any PARTICIPATING AGENCY'S performance <br /> of its obligations pursuant to its individual project agreement with the United States Bureau of <br /> Reclamation. Each PARTICIPATING AGENCY that receives a federal appropriation agrees to hold <br /> harmless BACWA from any and all claims, causes of action or liabilities arising from or connected <br /> to (1) the PARTICIPATING AGENCY'S acceptance and use of the federal appropriation and /or (2) <br /> the project for which the appropriation was received. <br /> 4. Neither BACWA nor the PARTICIPATING AGENCIES are required to accept the USBR <br /> proposed agreement terms. If USBR requires an agreement with BACWA, the terms of <br /> which BACWA cannot agree, BACWA;s obligations under this Agreement shall terminate. If <br /> the affected PARTICIPATING AGENCIES do not enter into the USBR agreement, the <br /> affected Parties' obligations under this Agreement shall terminate. <br /> VIII. DISPUTES <br /> The PARTIES agree to follow this dispute resolution procedure: <br /> 1. Informal Conferral. If a dispute related to the interpretation, enforcement, or compliance with the <br /> terms and provisions of this Agreement arises, the affected agencies will first attempt to resolve it <br /> through informal discussions, which will include the persons identified as Agency Contacts in Section <br /> IX below for the affected agencies. If such a dispute cannot be resolved in this matter within fifteen <br /> (15) business days, the affected agencies will endeavor to settle the dispute through negotiation. <br /> 2. Negotiation. Not more than fifteen (15) business days after the conclusion of the informal conferral, <br /> the aggrieved agency shall serve on the other affected agencies (a) written notice of the nature and <br /> basis of the dispute, including any amount of money claimed, the provisions of the Agreement at <br /> issue, and the facts in support of its position; and (b) a copy of all supporting documents. Within ten <br /> (10) business days after service of the notice, the responding agencies shall serve on the aggrieved <br /> agency (a) a written response setting out their position, including the provisions of the Agreement <br /> relied on and the facts in support thereof; and (b) a copy of all supporting documents. Within ten <br /> 7/21/2008 Page 5 <br />