exv10w16



 





EXHIBIT 10.16




SEWER USE AGREEMENT

BETWEEN

THE CITY OF DUBUQUE, IOWA

AND

WESTERN DUBUQUE BIODIESEL




     This Agreement, dated the 20 day of May, 2007, is made and entered into by and
between Western Dubuque Biodiesel (“Company”), an Iowa business corporation, and the City of
Dubuque, Iowa, (“City”) a municipal corporation.



     WHEREAS, City currently has an Iowa Department of Natural Resources permit to process
municipal and industrial wastes and to discharge treated effluent into a navigable waterway in
conformance with said permit; and



     WHEREAS, Company owns and operates a facility (the Facility) located at 301 1st
Street Ne P.O. Box 82 in Farley, Iowa, and is desirous of entering into a sewer use agreement
with City.



     NOW THEREFORE, the parties do mutually agree as follows:


SECTION 1. DEFINITIONS. As used herein, the following terms shall have the following meanings:



1.1 EPA — Environmental Protection Agency. The U.S. Environmental Protection Agency, or,
where appropriate, the Administrator or other duly authorized official of said Agency.



1.2 CBOD5 — Carbonaceous Biochemical Oxygen Demand (CBOD). The quantity of oxygen utilized
in the biochemical oxidation of carbonaceous matter under standard laboratory procedure, measured
at 5 days, 20 degrees Celsius, expressed in terms of concentration (milligrams per liter [mg/l]).



1.3 TSS or Suspended Solids — Suspended Solids. The total suspended matter that floats on
the surface of or is suspended in water, wastewater, or other liquids, and which is removable by
laboratory filtering.



1.4 Surcharges. Charges to be paid by Company based on hydraulic loading, CBOD, and
Suspended Solids that exceed maximum limits and time frames as set forth herein.



1.5 POTW — Publicly Owned Treatment Works (POTW). City’s treatment works as defined by
Section 212 of the Water Pollution Control (33 U.S.C. 1292) including any sewers that convey
wastewater to the treatment plant, but not including pipes, sewers, or other conveyances not
connected to facility providing treatment. “POTW” shall include any sewers that convey wastewater
to the POTW from persons outside the corporate boundaries of City who are, by Agreement with City,
users of City’s Wastewater Treatment Facility.




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SECTION 2. SERVICES PROVIDED BY CITY. City shall provide the required wastewater treatment and
disposal services to Company for wastewater discharged to the POTW in volumes and of the type
described in this Agreement.



SECTION 3. LIMITATION ON VOLUME AND LOADING. Company is hereby granted permission to discharge from
the Facility into the POTW up to the volumes and loadings described in this Agreement, but is not
required to discharge any minimum volume or loading.



SECTION 4. EFFECT OF REQUIREMENT OF HIGHER DEGREE OF TREATMENT. If any state or federal regulatory
agency requires City to install a higher degree of treatment to the domestic and industrial
wastewater flow than that contemplated herein, thereby requiring the making of changes to the POTW
that City determines are material, it shall give Company written notice of said requirement and the
proposed additional charges to Company for said higher treatment. Within six months after date of
delivery of said notice, Company may notify City in writing of its intent to terminate this
Agreement and this Agreement shall be terminated 30 days from the date of Company’s notice. If
Company does not give said notice of termination, then this Agreement shall continue in effect and
said proposed additional charges, unless otherwise agreed to by the parties, shall prevail as to
said higher treatment.



SECTION 5. COMPANY’S AUTHORITY. Company shall only discharge wastewater from the Facility into the
POTW in accordance with the effluent limitations, monitoring requirements and other conditions set
forth in this Agreement.



SECTION 6. TERM OF AGREEMENT. The term of this Agreement shall commence at midnight 7/20,
2007, and terminate at midnight on July 30, 2012.



SECTION 7. CHARGES. The following charges shall apply to Company:



7.1 Sewer use rates in Section 44-83 of the City of Dubuque Code of Ordinances shall be the basis
for the sewer use rates indicated below. Sewer use rates for Company shall be 1.5 times the rates
for those within the corporate limits of the City of Dubuque. In the absence of sewer use rates for
flow, CBOD5 and Total Suspended Solids, the following rates shall be used for all wastes discharged
by Company until such time as sewer use rates are otherwise established in Section 44-83 of the
City of Dubuque Code of Ordinances:




	 	 	 	 	 
	(1)

	 	Flow
	 	$.484/100CF
	(2)

	 	CBOD5
	 	$311.55/1000 lbs.
	(3)

	 	Total Suspended Solids
	 	$416.21/1000 lbs.





Sewer use rates shall be adjusted as required by City to reflect costs associated with the
operation of the POTW. The percentage increase or decrease of sewer use rates shall be the same as
the rate adjustments to the municipal users of the City of Dubuque POTW.



7.2 All charges associated with the implementation of the City of Dubuque’s Industrial


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Pretreatment Program shall be additional charges in accordance with Section 44-103 of the City of
Dubuque Code of Ordinances.



7.3 Invoices shall be issued by City to Company by the 15th day of each month for the prior month’s service.



7.4 Invoices shall be payable by Company not later than 15 days after the date of issuance.



SECTION 8. APPLICABLE EFFLUENT LIMITATIONS. Wastewater discharged by Company to the POTW shall not
exceed the following amounts as found in Company’s Industrial Pretreatment Permit with City:




	 	 	 	 	 
	Parameter	 	Monthly Maximum	 	Maximum Daily
	 
	Flow

	 	.217 Million Gallons
	 	7,000 Gallons
	CBOD5

	 	46,500 Pounds
	 	1,500 Pounds
	TSS

	 	930 Pounds
	 	30 Pounds





SECTION 9. EXCESS DISCHARGES & CHARGES. The rates set forth
herein shall be effective upon the commencement of the term of this Agreement. If City determines
in its sole discretion that waste treatment problems occur as a result of Company’s discharge
exceeding the daily maximum of 7,000 gallons. 1,500 pounds of CBOD5 or 30 pounds of TSS, or as a
result of a change in either state or federal regulations, then City and Company agree to jointly
work to resolve such problems as quickly as practical.



9.1 When the analyses and volume data show that any limit specified herein has been exceeded, City
shall so notify Company in writing. Company shall have ten working days after receipt of such
notice to reduce the limits. If the limits are met during the ten day period, no further action
shall be taken by City.



9.2 A surcharge shall be imposed for discharges which fall outside the pH range of 5.5 to 12.0 as
set forth in Section 44-102(3) of the City of Dubuque Code of Ordinances. Surcharge rates shall be
$100.00 per day in which one or more grab(s) or composite sample(s) is (are) found to be outside
the range.



SECTION 10. METERING, MONITORING AND REPORTING REQUIREMENTS.



10.1 Company shall provide to City in order for City to operate at Company’s expense, monitoring
capabilities to allow inspection, sampling and flow measurement of Company’s wastewater discharge.



10.2 Company shall allow City continuous access to any monitoring facilities
located at the Facility.



10.3 Monitoring results obtained on a daily/weekly basis and/or on a monthly basis shall be
reported by City to Company no later than the 15th of the following month. Monitoring
reports


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prepared by Company shall be signed by a Company principal executive officer or the officer’s
designee.



10.4 Testing to determine compliance with the limits set forth herein may be done by City’s representatives at any time. Company shall cooperate in making any necessary
arrangements for such testing. Sampling and analytical frequencies shall be determined by City and
accomplished by City’s representatives. All samples taken by City shall be divided with Company, if
requested by Company.



10.5 City’s Water Pollution Control Plant Manager shall make an initial determination of any
questions relative to the results of the sampling and testing. If Company does not agree with any
such determination, it shall notify City’s Water Pollution Control Plant in writing not less than
fifteen (15) days following receipt of notification.



10.6 When noncompliance is determined by City’s Water Pollution Control Plant Manager, and there is
no written request by Company under (e), Company agrees that the results of sampling and testing by
City shall be final for the determination of sewer use charges.



10.7 If Company does not accept City’s testing results, upon written request by Company, City shall
submit samples to the University of Iowa Hygienic Laboratory for testing. Company shall not be
entitled to submit more than twelve requests for sampling and testing week periods in any calendar
year.



10.8 All charges associated with independent testing shall be at Company’s expense and Company
shall reimburse City for any charges incurred by City upon receipt of a statement therefore from
City.



10.9 The methods and procedures for determining the extent of noncompliance shall, insofar as they
are consistent with the purpose of this paragraph, be those set forth above. The results of any
current sampling and testing period by City shall govern the extent of charges until the results of
the next sampling and testing, subject to appropriate refunds after final resolution of any
dispute.



SECTION 11. GENERAL DISCHARGE PROHIBITIONS. Company agrees to comply with the provisions set forth
in City’s Industrial Pretreatment Program in Ch. 44, Division 6 of the City of Dubuque Code of
Ordinances, as amended during the term of this Agreement.



SECTION 12. LIABILITY LIMITATIONS. It is not contemplated that there will be any interruption to
sanitary sewer service as herein contracted for, but if for any reason, including but not limited
to court order, or physical conditions beyond the control of City, City is unable to furnish the
services herein required, City shall not be liable for any damages or loss of any kind by Company,
including but not limited to breakdown or failure of the Facility. If City notifies Company that it
cannot for any reason accept the volume contemplated herein, City shall reduce the monthly charges
in the same proportion that the reduced volume bears to volumes contemplated by this Agreement.
Such interruption of service is limited to interruption caused by a non-permanent condition or
situation and does not contemplate the right


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of City to voluntarily abandon or curtail the service required herein.



SECTION 13. FAILURE TO PAY — TERMINATION OF SERVICE. In the event of the failure of Company to pay any amount due under this Agreement within 30 days after the
due date, or in the event of any other breach of any of the terms of this Agreement by Company
which is not corrected within 90 days from the date of written notice of such breach by City, City
may, at its option, terminate service to Company and/or enforce the provisions hereof by any legal
means.



SECTION 14. COMPLIANCE WITH GOVERNMENTAL LAWS. Company shall in the performance of this Agreement comply with all applicable federal, state and local
laws.



SECTION 15. EXCLUSIVENESS. This Agreement contains the entire agreement between the parties and
supersedes any prior understandings or agreement between them respecting the subject matter. There
are no representations, arrangements, understandings or agreements, oral or written between the
parties hereto relating to the subject matter of this Agreement except those expressed in this
Agreement.



SECTION 16. ASSIGNMENT OF AGREEMENT. Company shall not assign this Agreement without the prior
written consent of City. Company acknowledges and agrees that City, in its sole discretion and for
any reason, may refuse to grant consent to such assignment. Merger of Company with another
corporation, sale of the majority of the stock of Company to any other corporation, or
consolidation, shall be deemed an assignment for the purposes of this section.



SECTION 17. PARAGRAPH HEADINGS. Paragraph headings in this Agreement are for convenience only and
such headings do not add to or detract from the content of the paragraphs themselves.




	 	 	 	 	 	 	 
	CITY OF DUBUQUE, IOWA

	 	 
	 	WESTERN DUBUQUE BIODIESEL
	 	 
	 
	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 
	 
	 	 	 	 	 	 
	/s/ Roy D. Buol

	 	 	 	/s/ Thomas R. Brooks	 	 
	 

	 	 	 	 	 	 
	Roy D. Buol, Mayor

	 	 	 	General Manager	 	 
	 
	 	 	 	 	 	 
	Attest:

	 	 	 	Attest:	 	 
	 
	 	 	 	 	 	 
	/s/ Jeanne Schneider

	 	 	 	Jill M. Reuter	 	 
	 

	 	 	 	 	 	 
	Jeanne Schneider, City Clerk
	 	 	 	 	 	 






	 	 	 	 	 	 
	 	IOWA

	 	 	JILL M. REUTER	 
	 	NOTARIAL

	 	 	COMMISSION NO. 193141	 
	 	SEAL

	 	 	MY COMMISSION EXPIRES	 
	 	 

	 	 	10-22-2009	 
	 







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