Deposit and Reimbursement Agreement (Double Butte) 6.14.2023 ds
June 14, 2023
Double Butte Storage, LLC
Attn: Corinne Lytle Bonine
2180 South 1300 East, Suite 500
Salt Lake City, UT 84106
Re: Agreement for the deposit and reimbursement of fees incurred by the City of
Menifee in conducting and processing analysis under the California Environmental
Quality Act of the Double Butte Battery Energy System Project.
Dear Mrs. Lytle Bonine,
Double Butte Storage, LLC (“Developer”) has requested that the City of Menifee (the
“City”) consider the Double Butte battery energy storage system project (the “Project”). The
Project consists of approximately 27 acres of land on seven parcels identified as assessor parcel
numbers (APNs) 331-190-010, 331-190-011, 331-119-014, 331-190-017, 331-190-047, 331-190-
060, and 331-190-056. The Project will include the development, construction, operation and
maintenance of a 500-megawatt (MW) utility-scale (lithium-ion, flow or other technology) battery
energy storage system. The primary electrical equipment needed for the Project includes battery
modules and power conversion equipment. The battery modules will be racked (akin to server
racks) within hundreds of modular, external access-only containers that will connect to associated
electrical equipment. Each container would 8 to 10 feet tall and would be located within a metal
framed outdoor-rated storage container with insulation and robust thermal management systems.
A generation tie (gen-tie) line is being proposed to interconnect the Project to the existing Southern
California Edison (SCE) Valley Substation. The proposed gen-tie is estimated to be approximately
0.26 miles long (the “Gen-Tie”). To conduct its review and analysis of the Project and Gen-Tie,
the City is required to conduct an environmental analysis as required by the California
Environmental Quality Act, Public Resources Code section 21000 et seq., and its implementing
guidelines found at Title 14 of the California Code of Regulations section 15000 et seq. (“CEQA
Analysis”).
The City will commence to take the steps necessary, at Developers sole expense, so
that the City will be able to conduct and complete the CEQA Analysis. Developer is prepared to
reimburse the City for all costs associated with the City’s conduct, processing, and consideration
of the CEQA Analysis including, without limitation in-house staff time and resources,
environmental consultant time and resources, City’s legal counsel’s time and resources, and other
third-party cost items. For example, the costs incurred by the City to engage an environmental
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June 14, 2023
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review consultant, and any necessary sub-consultants or technical consultants, to conduct the
CEQA Analysis shall be borne by the Developer.
This letter serves as an Initial Deposit and Reimbursement Agreement (“Agreement”) by
and between Developer and the City. To assist the City in considering whether to approve the
Project, Developer agrees to provide the City with an initial deposit, consisting of at least 50% of
the contract amount plus, an administrative cost of 15% of the professional services agreement or
$5,000, whichever is less, in the amount of $45,497.50 (“Initial Deposit”). The Initial Deposit
plus any remaining balance due of the total of the Professional Services Agreement and
administrative cost is to be incurred by the City in connection with the conduct, processing, review,
evaluation, and action taken on the CEQA Analysis (“Analysis Costs”). Developer deposited the
Initial Deposit with the City, to the attention of the Finance Director, on or before June 23, 2023
(“Effective Date”), which is at least one (1) week in advance of the Professional Services
Agreement being fully executed by the City of Menifee with the selected consultant.
The remaining 50% or balance, if applicable, of the Analysis Costs $40,497.50 (“Second
Deposit Payment”) shall be due at the halfway point of completion of the Analysis , but no later
than the public release of the CEQA documents. The Community Development Department shall
notify the Developer once the halfway point of completion of the Analysis has been reached. The
Second Deposit payment shall be deposited with the City, to the attention of the Finance Director,
no later than thirty (30) calendar days of receiving notification from the Community Development
Department. If Developer fails to timely provide a Second Deposit Payment, the City may without
further notice cease all work on the CEQA Analysis and order that all consultants, attorneys and
third parties do the same (“Stop Work Order”) until the Second Deposit Payment is received.
Developer understands and acknowledges that, even if the Second Deposit Payment has not yet
been received, it shall remain fully responsible for Analysis Costs incurred by the City up to the
date that the City issues a Stop Work Order.
The Initial Deposit and Second Deposit Payment shall be used to reimburse the Analysis
Costs. If at any time the City in its sole discretion determines that the Analysis Costs will exceed
the amount of the Initial Deposit and Second Deposit Payment, then Developer shall, within thirty
(30) calendar days of receipt of written demand from the City, supplement the deposit amount so
that the amount remaining on deposit with the City equals all remaining estimated Analysis Costs
(“Deposit Supplement”). The City may from time to time repeat the process of revising the
estimated Analysis Costs and requiring a revised deposit amount from Developer (upon thirty)
calendar days’ written notice) (“Further Deposit Supplement” and collectively with the Second
Deposit Payment, Deposit Supplement, and the Initial Deposit, (the “Full Deposit”)). If Developer
fails to timely provide a Deposit Supplement or Further Deposit Supplement, the City may without
further notice cease all work on the CEQA Analysis and order that all consultants, attorneys and
third parties do the same and issue a Stop Work Order. Developer understands and acknowledges
that, even if the deposit is fully exhausted, it shall remain fully responsible for Analysis Costs
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incurred by the City up to the date that the City issues a Stop Work Order. The city will reimburse
Developer for any unspent monies within thirty (30) calendars days of receipt of the CEQA
Analysis’s final accounting. If Developer terminates this Agreement in writing, or once the project
is entitled, City will refund to Developer the remaining funds from the Full Deposit within thirty
(30) days upon receipt of the final accounting.
PAYMENT SCHEDULE:
Payment Description Amount Due Description Due Date
Initial Deposit At least 50% Analysis Costs
+ Lesser of 15% of Analysis
Costs OR $5,000
At least one (1) week before
Professional Services
Agreement Signed
Second Deposit 50% or balance of Analysis
Costs
Within thirty (30) calendar
days of Notification from
Community Development
Department of halfway point
of Analysis Completion
Deposit Supplement/
Further Deposit
Supplement
TBD, if applicable, for
additional contract
amendment costs identified
Within thirty (30) calendar
days of Notification from
Community Development
Department of need for
Deposit Supplement.
Developer understands and acknowledges that City shall exercise its sole discretion in
selecting and providing direction to any consultants or other third parties in connection with the
CEQA Analysis.
It is anticipated that the CEQA Analysis will be presented to the Menifee Planning
Commission and City Council for consideration and potential action in the future. Developer and
the City understand that the City is reserving the right to exercise its sole and absolute discretion
as to all matters over which the City is, by law, entitled or required to exercise di scretion. By
executing this Agreement, the City is not committing or agreeing to undertake any activity
requiring the subsequent discretion of the City, or any department of the City. The City’s execution
of this Agreement is merely an agreement to allow the necessary work to be completed, at
Developer’s expense, to bring the CEQA Analysis forward for City consideration. Nothing in this
Agreement shall be deemed to constitute a commitment by the City to approve or certify the CEQA
Analysis, or a prejudgment of the matters required to be considered as part of the decision whether
or not to approve the Project.
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Please document Developer’s concurrence with these terms and limitations by signing
below and returning the originally executed letter to me, along with the Initial Deposit.
Very truly yours,
CITY OF MENIFEE
Cheryl Kitzerow, AICP
Community Development Director
APPROVED AS TO FORM:
By:
Jeffrey Melching, City Attorney
ACCEPTANCE OF INITIAL DEPOSIT AGREEMENT:
Double Butte Storage, LLC
By: Date:
Corinne Lytle Bonine
Director of Permitting
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6/14/2023
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